DLR v P
[2015] NZHC 603
•30 March 2015
NOTE: PURSUANT TO S 35A OF THE PROPERTY (RELATIONSHIPS) ACT 1976, ANY REPORT OF THIS PROCEEDING MUST COMPLY WITH SS 11B TO 11D OF THE FAMILY COURTS ACT 1980. FOR FURTHER INFORMATION, PLEASE SEE COURT/LEGISLATION/RESTRICTIONS-ON-PUBLICATIONS.
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2014-404-002857 [2015] NZHC 603
UNDER the Property (Relationships) Act 1976 and
the Family Proceedings Act 1908
IN THE MATTER
of an appeal against a decision of the
Family Court at AucklandBETWEEN
DLR Appellant
AND
P
First RespondentTHE PUBLIC TRUSTEE Second Respondent
Hearing: 17 March 2015 Counsel:
S D Cummings for Appellant
J H Hunter for First RespondentJudgment:
30 March 2015
JUDGMENT OF BREWER J
This judgment was delivered by me on 30 March 2015 at 2:30 pm pursuant to Rule 11.5 High Court Rules.
Registrar/Deputy Registrar
Solicitors: Douglas MA Burgess (Auckland) for Appellant
Stephen Anderson (Auckland) for First Respondent
DLR v P [2015] NZHC 603 [30 March 2015]
Introduction
[1] In 2013, Family Court Judge DA Burns delivered a judgment deciding relationship property issues between Mr P and Ms DLR.1 He left for a future hearing a claim by Ms DLR for spousal maintenance and a cross-claim by Mr P for occupation rental.
[2] The Judge directed that Ms DLR vacate the family home within 42 days. However, Ms DLR wanted $45,000 to enable her to do this. To get it, she needed the co-operation of Mr P. The parties’ lawyers engaged.
[3] Mr P’s position is that an agreement was reached whereby, in return for Mr P consenting to Ms DLR receiving an advance of $45,000, Ms DLR would discontinue her appeal against Judge Burns’s judgment and discontinue her claim for spousal maintenance. Mr P would not pursue his claim for occupation rental. In other words, Mr P submits that the parties agreed to settle their disputes.
[4] Ms DLR’s position is that only a conditional agreement was reached. The condition was that she provide notices of discontinuance in order to get payment. Ms DLR decided not to fulfil the condition, and so the agreement never became binding and she never received the payment.2 Ms DLR did discontinue her appeal against Judge Burns’s decision, but she says that was for her own reasons.
[5] The parties went back to Judge Burns. In a letter to the Registrar dated
3 March 2014, Mr Cummings noted that the Judge had not determined “issues of
occupation rent, spousal maintenance and any other adjustments pursuant to Section
18B of the Act”. He went on to say that “the issue of Section 15 compensation was neither addressed in his Honour’s judgment or in any way dispensed with or
discontinued”.3 Mr Cummings advised that Ms DLR wanted a hearing to resolve
1 TRP v DLR [2013] NZFC 8297.
2 Ms DLR did receive an initial advance of $2,755.50 on an urgent basis during the period the agreement, conditional or otherwise, was being negotiated.
3 This is not surprising. “Section 15 compensation” refers to the jurisdiction given to the Court by s 15 of the Property (Relationships) Act 1976 to award compensation to a spouse or partner whose situation has been reduced in comparison with the other spouse or partner because of the division of functions within their relationship. No application for such compensation had ever been made.
those matters and suggested a timetable for filing affidavits and for allocating a hearing date.
[6] Ms Hunter wrote to the Registrar, also on 3 March 2014, seeking an abbreviated timetable for the filing of Ms DLR’s affidavit.
[7] Judge Burns issued a Minute the next day setting a timetable for the filing of affidavits and the holding of a judicial conference.
[8] In a memorandum dated 1 April 2014, Mr Cummings, on behalf of Ms DLR, complained to the Judge that orders made by the Judge in [47(e)] and [47(d)] of his judgment had not been complied with. There is no specific application contained within the memorandum but, by inference, Mr Cummings was seeking a direction from the Judge that Ms DLR be paid immediately one-half of one of the relationship property assets, namely Mr P’s superannuation fund. Ms Hunter, for Mr P, replied in a memorandum dated 9 April 2014. Ms Hunter stated Mr P’s position that the parties had settled the issues between them.
[9] Mr Cummings at once replied by memorandum sent on the same day. He repeated his submission that a proper interpretation of Judge Burns’s judgment is that Ms DLR is entitled to payment of her share of the superannuation. He disputed that settlement had occurred. He finished:
9.Counsel’s overriding concern is that [Ms DLR] is being denied the right to contest the outstanding issues as a direct result of [Mr P’s] refusal to comply with the Court Orders that have already been made at paragraph 47 of His Honour’s Judgment.
10.It is respectfully submitted that this is not a matter that requires hearing, as is proposed at paragraph 33 of [Mr P’s] submissions of
9 April 2014. It is a matter for the Court to direct compliance with
existing orders that have not been appealed against. The orders made as recorded in paragraphs 47(d) and 47(e) are clear and unambiguous. They are not related to the [Trust property at the home address]; they do not require settlement into trusts to be implemented. [Ms DLR’s] obvious and counsel notes acknowledged hardships can be immediately alleviated by [Mr P’s] compliance with the orders of the Court.
[10] Judge Burns then moved to resolve matters. His Minute dated 11 April 2014 is:
Directions were made by me on 4 March 2014 which have not been
complied with. I have read Mr Cummings’ memorandum dated 1st April and
9th April. I have read Ms Hunter’s memorandum of 9th April. I direct as follows—
1. Set down the case for urgent hearing before me – 1½ hours.
2. I request Ms Hunter to prepare an adjustment schedule setting out the division between the parties in terms of purported settlement and whether it departs the Court orders 5 days prior to the hearing. Mr Cummings is to provide a statement in reply setting out the division as he contends for in accordance with Court orders 3 days prior to the hearing.
3. The extension of the hearing is to make final orders of the exact division between the parties so that each party knows to the last cent how much is to be paid.
[11] In a judgment delivered on 6 October 2014,4 the Judge held that there had been a concluded agreement and accepted Ms Hunter’s calculation of relationship property values and distribution. The Judge ruled that the spousal maintenance claim and the claim for occupation rent were discontinued pursuant to the agreement between the parties. He referred to the s 15 claim but did not specifically dispose of it. His Honour also ordered that Ms DLR pay, from her share of the relationship property, the costs of counsel appointed to assist the Court.
[12] Ms DLR appeals the decisions of the Judge in the 6 October 2014 judgment.
Issues
[13] The issues I have to decide are:
(a) Was the Judge correct that the parties had settled their disputes?
(b)Was the Judge correct to order Ms DLR to pay the costs of counsel assisting?
(c) Is Ms DLR entitled to pursue a s 15 claim?
4 TRP v EMDeLaR [2014] NZFC 8187.
(d)If Ms DLR still has a claim or claims she can bring, should I remit the case to the Family Court or decide the outstanding claim or claims myself?
Did the parties settle their disputes?
[14] To answer this issue requires an evaluation of the relevant correspondence between the parties:
(a) Letter of 4 November 2013. Johanna Robertson, barrister, wrote to
Ms Hunter (relevantly) as follows:5
My client’s major concern is that she, simply, has no money to fund bond, rental, moving and storage costs as well as living expenses and legal costs until the family home is sold.
To that end, she proposes:
1. That she be provided the sum of $45,000 as an advance from her share of the Trust and relationship property.
2. …
3. That the proposed further hearing regarding maintenance and s 18B post separation adjustments not take place and that, effectively, these claims are set off against each other. In effect, this would mean the end of the Family Court litigation.
4. That the appeal … currently before the High Court will
be abandoned with no question as to costs.
(b)Letter of 12 November 2013. Ms Hunter replied to Ms Robertson in positive terms but with provisos.
(c) Letter of 14 November 2013 by Mr Cummings to Ms Hunter in reply to Ms Hunter’s letter.6 Mr Cummings addressed the provisos. He concluded:
For very obvious reasons a prompt response is required. I
believe we have the opportunity to bring this matter to a
5 Ms Robertson was at this time acting for Ms DLR.
6 Mr Cummings has now been appointed to act for Ms DLR in place of Ms Robertson.
ready conclusion as was proposed by Ms Robertson. I look forward to hearing back from you with the urgency required. If it needs to be said, the rental will be lost if the small amount of funds required urgently ($2,755.25) are not made available forthwith. If that occurs there are issues as to vacating the home, re-housing [Ms DLR] and all the associated costs (legal and otherwise) that flow from that. I assume [Mr P] would rather facilitate a structured disengagement as is proposed than see further argument.
(d)Email of 18 November 2013 from Mr Cummings to Ms Hunter, copied to Ms DLR, in which Mr Cummings writes:
I am still awaiting a response to my correspondence of last week and would appreciate you attending to that. If there is any possibility of the home being vacated by 21 November
2013 the matters raised therein will need to be addressed.
(e) Letter of 19 November 2013 by Ms Hunter to Mr Cummings and sent by email. Ms Hunter addresses the points made by Mr Cummings in his letter of 14 November 2013 and concludes:
It is now timely for you to confirm that your client is abandoning the High Court Appeal, withdrawing the maintenance proceedings and accepting matters are at an end. If your client is ready, willing and able to do that and indeed that is actioned this week, then my instructions are my client will co-operate in getting the Public Trust’s to release the appropriate funds (by way of Automatic Payment) to pay your client’s rental pending settlement following sale.
If your client is not willing to do so, then the Orders of Court remain in place and your client remains bound to adhere to them. That said, we do recognise that there is merit for both parties in achieving the closure suggested by Ms Robertson, however I need to be clear that my client will not attend to this on a piecemeal basis. What was proposed by Ms Robertson was a “package deal” and whilst the bond and advance rental have been paid as a gesture of good faith, the ball remains firmly in your client’s court in terms of next steps.
(f) Letter of 20 November 2013 by Mr Cummings to Ms Hunter, sent by email, replying to Ms Hunter’s letter of 19 November 2013. He responds to the points made by Ms Hunter. Of relevance is the following passage:
4(a) I understand the position you are proposing. My query arose from my client’s belief that Ms Robertson in her letter of 4 November 2013 proposes a $45,000 advance by way of partial settlement. I see that the letter is ambiguous as to the origin of the $45,000 payment…
Mr Cummings concludes:
On settlement of the matters the subject of this correspondence the appropriate documentation to discontinue the proceedings will be filed, but not before.
I note that this letter was copied to Ms DLR by email.
(g)Letter of 28 November 2013 by Mr Cummings to Ms Hunter, sent by email and copied by email to Ms DLR. In this letter Mr Cummings, having advised Ms Hunter that he had “pressed [Ms DLR] for a response”, states:
I wish to confirm that the settlement offer is as follows:
A. [Mr P] make payment (say within 7 days) to [Ms DLR]
in the sum of $41,708.00, being the difference between
$45,000.00 and the sum of the bond and rental in
advance ($2,757.00) and the week’s rent paid on
28 November 2013 ($535.00) – total $4,178.00.
B. Payment is in every respect conditional on withdrawal of the extant proceedings in the Family Court (balance of property and spousal maintenance remaining at issue) and the appeal set down for a half day in the High Court on 4 December 2013.
C. No issue as to costs will be taken by either party in respect of these proceedings.
If the above is the settlement then it is accepted and I will file the necessary notices of discontinuance. This will leave to be concluded the preparation of the [family home] for sale, the sale of the property and the division of the proceeds in accordance with Judge Burns’ decision. Please confirm as soon as possible, noting the urgency attached in respect of the High Court matter.
(h) Email sent 2 December 2013 at 11:01 am by Ms Hunter to
Mr Cummings. In response to Mr Cummings’s letter of 28 November
2013, Ms Hunter writes:
Provided that it is accepted that the $45,000 being paid to your client ($2,757 having already been received) is in partial settlement of her entitlements to relationship property division as per the court orders then we have agreement.
My client will arrange for the funds to be paid to whom you nominate via my instructing solicitor. Please advise the details of where he should on pay the money.
(i)Email sent 2 December 2013 at 1:37 pm by Mr Cummings to Ms Hunter and copied to Ms DLR. In this email, Mr Cummings advises:
Thank you for your email of 2 December 2013. I confirm that it is accepted that on payment from your client to mine in the sum of $41,708.00 there is partial settlement of that sum by [Mr P] to [Ms DLR] of her entitlement pursuant to the Court Orders. The difference between that and the
$45,000.00 ($3,292.00) made up of the bond and advance rent, together with one week’s rent is acknowledged as
received by way of partial settlement as requested. For
completeness, I advise that it is likely that [Ms DLR] will, to avoid the interest costs, repay the latter sum to the Public Trust and in that regard that latter sum will be due to her on settlement.
Could you please have your instructing solicitors provide an undertaking (urgently) that payment will be made on receipt of my notices of discontinuance being filed. The payment is to be made to the account of [Ms DLR].
I appreciate that you will inevitably be very busy, but I ask that you attend to this urgently so that the documentation can be sent out.
(j) Email sent 4 December 2013 at 3:34 pm by Mr Cummings to
Ms Hunter and copied to Ms DLR. Mr Cummings says:
I have not received the undertaking from your instructing solicitors as requested. In addressing that matter, could you also advise when the funds are likely to be available – I would expect it to be in the very near future.
(k)Email sent 4 December 2013 at 8:50 pm by Mr Cummings to the solicitor instructing Ms Hunter and copied to Ms DLR. Mr Cummings wrote:
I am aware that you are the solicitor for [Mr P] and have instructed Ms Jane Hunter to act as counsel. I corresponded
with Ms Hunter today in respect of implementation of agreements in respect of partial settlement. In short, those agreements required the giving of undertaking by yourself to confirm payment to my client in the sum of $41,708.00.
Could you please provide both the undertaking to make payment in that sum and provide an accurate indication of when the funds will be received by [Ms DLR]. The details of the account for payment have already been provided Ms Hunter. I correspond with you as the email I sent today generated an automatic response advising that Ms Hunter was unavailable and invited me to contact her instructing solicitors.
Mr Anderson’s response the next morning was to the effect that he was not in a position to give the undertaking. In subsequent email exchanges, the solicitor explained that he did not know anything about the settlement.
(l) Letter dated 12 December 2013 and sent by email from Ms Hunter to
Mr Cummings. Ms Hunter advises (relevantly):
2. From the tone of your correspondence there was urgency to the matter. Accordingly Mr Anderson7 provided the required undertaking and [Mr P] deposited the agreed funds into the solicitor’s trust account on Friday 6 December 2013.
3. To date neither myself nor Mr Anderson have heard anything back from you, despite follow up correspondence, and the Notice of Discontinuance has not been filed in the Family Court.
4. I would therefore be grateful if you could advise the status of such notice so we can progress this matter and have it dealt with before the holiday period.
(m)Email sent 18 December 2013 at 6:06 pm from Mr Burgess (Mr Cummings’s instructing solicitor) to Ms Hunter and copied to Ms DLR. This email reads, relevantly:
I attach the Notice of Discontinuance in the Family Court. (The Discontinuance has been filed in the High Court).
My Trust Account deposit slip is also attached.
I undertake that Mr Cummings will sign the Notice and will send it to Jane Hunter and to the Public Trust immediately after the funds due to [Ms DLR] are paid to my Trust account.
If there are any issues please urgently contact me or
Mr Cummings.
(n)Email sent 18 December 2013 at 10:07 pm by Ms DLR to her lawyers and to Mr P’s lawyers. In this email, Ms DLR adds a stipulation to discontinuing Family Court proceedings. It concerns a matter not previously raised in the correspondence to which I have to this point referred.
(o) Email sent 19 December 2013 at 9:44 am by Mr Anderson to
Mr Burgess, copied to Ms Hunter. He writes:
Hi Doug, I got your trust a/c deposit but the notice of discontinuance was not attached. I would like to see the signed notice of discontinuance before I pay any money over, and then have an undertaking it will be filed.
(p)Email sent 20 December 2013 at 1:22 pm by Ms DLR to Ms Hunter and Mr Anderson, copied to Mr Burgess and Mr Cummings:
I confirm that negotiations have ended, that you will not accept the undertaking of my solicitor, an officer of the court to file a notice of discontinuance.
The result of that, is that funds that are mine and that I desperately need are not available. We will head back to court in 2014.
The Judge’s view of the correspondence
[15] The Judge reviewed the correspondence and found:8
[11] I find and accept the submission made by Ms Hunter that the parties did achieve settlement with respect to all matters and that [Mr P’s] solicitor remained in funds and there was agreement. [Mr P] was ready, willing and able to settle. The agreement reached through the agency of [Ms DLR’s] solicitor and counsel is binding. Whilst [Ms DLR] sought to resile from the agreement I consider that she is unable to do so and was bound by the decisions made by her where her lawyers were clearly instructed and reached
settlement on her behalf. She accepted that there would be a full and final settlement on a once and for all basis and that was not to be a settlement on a piecemeal basis.
…
[13] I find therefore that a settlement has occurred between the parties and that the emails of 28 November 2013 and of 29 November 2013 confirmed the full and final settlement with respect to the balance of the issues between the parties and I consider that [Ms DLR] is bound by that settlement. I consider that [Mr P] has altered his position in reliance of that settlement. I also find and accept that as a result it is appropriate for [Mr P] to settle on a full and final basis rather than on a piecemeal basis.
Submissions on behalf of Ms DLR
[16] Mr Cummings does not dispute that the parties reached a conditional agreement to settle the disputes then extant. His submission is that the agreement was conditional on Ms DLR providing notices of discontinuance. He points to his letter of 28 November 2013 in which he stipulated:
Payment is in every respect conditional on withdrawal of the extant proceedings in the Family Court (balance of property and spousal maintenance remaining at issue) and the appeal set down for a half day in the High Court on 4 December 2013.
[17] In Mr Cummings’s submission, the withdrawal of the proceedings (through the provision of notices of discontinuance) was in the hands of Ms DLR. When she chose not to provide notices of discontinuance the agreement was at an end because the condition was not satisfied. He called this a “condition precedent”.
Discussion
[18] Parties to a litigation may end it by agreement. An agreement, of course, requires a meeting of the minds.9 The terms of the agreement must be enunciated and accepted by the parties. Negotiations must have ceased in the sense that there is nothing left for the parties to resolve before the agreement can be given effect.
[19] In this case I find that the parties, through their counsel, reached agreement. The proposal, or offer, was made on behalf of Ms DLR by Ms Robertson in her letter
9 Electricity Corp of New Zealand Ltd v Fletcher Challenge Energy Ltd [2002] 2 NZLR 433 (CA)
at [50].
of 4 November 2013. It had, really, two parts. Ms DLR would be advanced $45,000 and the extant proceedings in the Family Court and in the High Court would be discontinued.
[20] Subsequent correspondence between Mr Cummings and Ms Hunter clarified the intent and the details. The final terms of Ms DLR’s offer were communicated by Mr Cummings in his letter of 28 November 2013. By email of 2 December 2013, Ms Hunter accepted the offer with one proviso; namely, that the payment be accepted in partial settlement of the entitlements ordered by Judge Burns in his 2013 judgment. By return email Mr Cummings confirmed the proviso. At that point the agreement was concluded. What happened afterwards was about the machinery for giving effect to the agreement. If Ms DLR had not intervened then the agreement would have been implemented.
[21] I do not accept Mr Cummings’s submission that the requirement that Ms DLR discontinue the proceedings was a condition that had to be met before the agreement could exist. The requirement to discontinue the proceedings was simply a term or provision of the agreement.
[22] Likewise, I do not agree that the requirement to discontinue the proceeding was subject to a right in the hands of Ms DLR to decline to perform it. No such stipulation was ever mentioned, and neither can it be inferred. This was a simple agreement. Ms DLR changed her mind, but by then it was too late.
[23] Mr Cummings raised other points that can be dealt with shortly:
(a) He did not have instructions from Ms DLR to settle the dispute. First, Ms DLR was an addressee of the important communications. There is no suggestion she did not know what was being negotiated on her behalf. Secondly, counsel have the agency to bind their clients in such a situation, and without a clear disclaimer of authority Mr P was
entitled to rely on that.10
10 Thompson v Howley [1977] 1 NZLR 16 (SC); Savill v Chase Holdings (Wellington) Ltd [1989] 1
NZLR 257 (HC); Sims v Lowe [1988] 1 NZLR 656 (CA); Kirkness v Sheldon [1929] NZLR 108 (SC); Welsh v Roe (1918) 87 LJKB 520. See also Waugh v HB Clifford & Sons Ltd [1982] Ch
374 (CA).
(b)Some of the correspondence, particularly the letter from Mr Cummings of 28 November 2013, was marked “without prejudice”. It cannot be used against Ms DLR. That would be correct if agreement was not reached. But it was, and so the correspondence establishing the agreement can be relied upon.11
(c) The correspondence cannot constitute a binding agreement pursuant to s 21 of the Property (Relationships) Act 1976 because the formal requirements of s 21F were not complied with. Section 21, and more relevantly s 21A(1), confer on parties a right to contract out of the Act. In other words, parties in a qualifying relationship may agree as they think fit the status, ownership and division of their property. Section 21F makes void any such agreement which does not satisfy formal requirements (going largely to informed consent). These provisions do not apply to this case. The agreement here was to settle a litigation. It was not to contract out of the Act by agreeing the status, ownership or division of property.
(d)The procedure adopted by the Judge did not accord with natural justice. He did not make it clear that he was going to consider whether the parties had settled their dispute, and he did not give Ms DLR the opportunity to call evidence. However, it was Mr Cummings who approached the Court in his letter of 3 March
2014 asking for a hearing to resolve the issues. On 4 March 2014, the Judge set a timetable for the filing of affidavits, which was not complied with. On 1 April 2014, Mr Cummings raised the further issue of the interpretation of [47(e)] and [47(d)] of the 2013 judgment, and Ms Hunter in reply stated Mr P’s position that the parties had settled. The Judge, in his 11 April 2014 Minute, noted that his directions of 4 March 2014 had not been complied with, referred to the subsequent memoranda and set “the case” down for hearing. There was no breach of natural justice arising from this procedure.
Mr Cummings had instigated the hearing, he had raised the issues to
11 Evidence Act 2006, s 57(3)(b).
be determined, and the Judge determined them.12 On the issue of whether an agreement had been reached, the correspondence between the lawyers was critical and was before the Judge. I do not see how further evidence could have affected matters.
(e) The Judge was wrong to make comments about the equivalence in this case of claims for spousal maintenance and occupation rental. However, in my view those comments were not operative parts of the judgment. As I read them, they were the comments of a judge doing a rough cross-check on the equities of an agreement reached by the parties.
Should Ms DLR have been ordered to pay the costs of counsel assisting?
[24] The Judge held:13
In addition I direct that before payment of that sum to [Ms DLR] the Public Trust is to ascertain from the Court the costs incurred by the Court in appointing Mr Gluestein as counsel to assist and Ms Wagner as counsel to assist. Both of those appointments were made primarily to assist [Ms DLR] because she was struggling with the complexity of the proceedings and finding it very difficult to cope. She was filing documents which were difficult to understand and was at the time unwilling to engage counsel of her own choice. Mr Gluestein’s appointment was terminated as soon as she instructed new counsel. Ms Wagner was appointed when that counsel sought to withdraw. Both Mr Gluestein and Ms Wagner provided assistance to the Court which was necessary in advancing [Ms DLR’s] interests. It would be wrong if the New Zealand taxpayer met the costs of both counsel and also [Mr P] would regard it as an injustice if he had to pay his own counsel (which he has done) and yet the Court met costs of lawyers who were engaged primarily to assist [Ms DLR]. Accordingly I direct therefore that both Ms Wagner’s and Mr Gluestein’s costs be paid by [Ms DLR] and to be paid from the sum of money payable by the Public Trust in full and final settlement prior to her receiving payment of the balance. That payment is to be made directly to the Registrar of the Auckland Family Court. Once that payment is made that concludes all issues between the parties and I wish them the best for their future life and hopefully they can move on from the unhappiness which has arisen.
[25] This is not an area in which Mr P has an interest. Mr Cummings submits that the Judge should not have ordered Ms DLR to pay costs because:
12 I exclude from this comment the s 15 issue, which I deal with later in this judgment.
13 TRP v EMDeLaR, above n 4, at [15(vii)].
(a) Ms DLR was not on notice of this possibility prior to the hearing on
9 September 2014. No submissions were made on the issue at the hearing.
(b)The costs relate particularly to the substantive hearing determined by the 2013 judgment. No costs were awarded in that judgment.
(c) Ms DLR was represented by counsel during part of the period when counsel to assist were appointed.
(d)Ms DLR had the right to represent herself. She opposed the appointment of counsel to assist. The appointments were made on the volition of the Court, and counsel’s mandate was to assist the Court.
[26] Section 40 of the Act provides:
Subject to any rules of procedure made for the purposes of this Act, in any proceedings under this Act the Court may make such order as to costs as it thinks fit.
[27] In this case, s 40 refers to the Family Court. Section 16A of the Family Courts Act 1980 permits the making of rules regulating the practice and procedure of Family Courts. One such rule provides structure to the discretion conferred by s 40 of the Act:14
(1) The court has discretion to determine the costs of—
(a) any proceeding:
(b) any step in a proceeding:
(c) any matter incidental to a proceeding.
(2) In exercising that discretion, the court may apply any or all of the following DCRs, so far as applicable and with all necessary modifications:
(a) 14.2—principles applying to determination of costs: (b) 14.3—categorisation of proceedings:
14 Family Court Rules 2002, r 207.
(c) 14.4—appropriate daily recovery rates: (d) 14.5—determination of reasonable time:
(e) 14.6—increased costs and indemnity costs: (f) 14.7—refusal of, or reduction in, costs:
(g) 14.8—costs in interlocutory applications:
(h) 14.9—costs may be determined by different Judge:
(i) 14.10—written offers without prejudice except as to costs: (j) 14.11—effect on costs:
(k) 14.12—disbursements.
(3) This rule is subject to the provisions of the family law Act under which the proceedings are brought.
[28] I note that r 207 does not provide jurisdiction to order a party to pay the costs of counsel appointed to assist the Court. The High Court has a specific power to do so, conferred by s 99A of the Judicature Act 1908, but the Family Court does not.
[29] The Family Court is a creation of statute. Its judges do not have an inherent jurisdiction which might permit them to go beyond the metes and bounds of statute to make orders they consider necessary in the interests of justice. The judges have, of course, an inherent power to order the processes of their Courts, but an inherent power cannot be exercised to create a jurisdiction.
[30] Accordingly, I doubt that the Judge had the jurisdiction to order Ms DLR to pay the costs of assisting counsel (or to reimburse the State). But I do not need to decide the point (which was not argued before me) because I have a clear view that the order is void for breach of natural justice.
[31] Ms DLR was not given notice of the Judge’s intention to consider ordering her to pay the costs of assisting counsel. She was not heard on the issue. It is not an issue without complexity.
Is Ms DLR entitled to pursue a s 15 claim?
[32] This issue would not have arisen if there had been a more rigorous approach to pleading Ms DLR’s case.
[33] Section 15 of the Act empowers the Family Court to make orders to redress economic disparities arising from the division of functions within a relationship. In this case, no formal application under s 15 has ever been made on behalf of Ms DLR. It was mentioned by Mr Cummings in his letter of 3 March 2014 but that was not a formal application, although it was submitted to me that such mention can be taken by a Judge of the Family Court to constitute an application (which, I infer, is how the Judge treated it).
[34] In any event, the response by the Judge was to allow an affidavit to be filed. None was. Instead, the blizzard of tit-for-tat memoranda continued, with Mr Cummings’s further memoranda being dated 10 April 2014, 5 May 2014, 7 May
2014, 16 June 2014 and 4 September 2014. None mentioned s 15. All are concerned with obtaining a direction that, pursuant to [47] of the Judge’s 2013 judgment, an immediate interim distribution should be made to Ms DLR.
[35] The Judge, in his 2014 judgment, does not refer to Mr Cummings’s
invocation of s 15 other than to record:15
On 3 March 2014 Mr Cummings on behalf of [Ms DLR] sought four weeks in order to file further affidavits making further claims including a new s 15 claim. The matter was referred to me and by minute of 4 March 2014 I directed that [Ms DLR] file and serve any further affidavits in 21 days and a reply in equal time. A judicial conference was to be allocated thereafter. I find that no affidavits have been filed by [Ms DLR]. Instead on 1 April 2014
Mr Cummings’s memorandum was filed suggesting that [Mr P] pay a full half share of his superannuation to [Ms DLR].
[36] The Judge goes on to hold that the parties had settled their differences “on a full and final basis”.
15 At [12].
[37] I have found that the parties did agree to settle the disputes that were the subject of their correspondence. But that is not the same thing as a full and final settlement of all matters that might then or in the future be in dispute between them.
[38] An agreement to settle a dispute must be construed like any other agreement to ascertain the intentions of the parties. Here, the agreement related to the appeal of the 2013 Judgment, the spousal maintenance claim and the claim for occupation rent. There was no agreement that all disputes between the parties, present or future, were settled. Lawyers drafting settlement agreements are always careful to delineate their scope. The phrase “full and final” is used commonly to indicate that a dispute is at an end. If the agreement is intended to mean that a party cannot make any claims in the future on a different basis to the dispute settled, it must say so. It is usual to qualify “full and final” accordingly. In this case, nowhere in the correspondence recording the agreement is “full and final” used, nor is there any intention expressed that the agreement reached goes beyond the matters included in it.
[39] The fact that the Judge permitted Ms DLR to file an affidavit, and she did not, does not mean that she abandoned her claim or that it could be struck out summarily. First, no formal claim was made. Mr Cummings, in the first of his many communications, simply referred to it in passing. Secondly, all his subsequent memoranda were focused on what he wanted the purpose of the hearing scheduled by the Judge to be; the interpretation of [47] of the 2013 Judgment. Thirdly, it is not clear from the 2014 judgment whether the Judge purported to deal with a claim under s 15. In my view, his Honour simply decided that the parties had agreed to settle all their disputes on a full and final basis, including any s 15 claim. That was an error.
[40] In these circumstances, I hold that the s 15 claim remains open. I note, however, that s 24 of the Act provides time limits for making applications, subject to the right of the Court to extend the time. If Mr Cummings’s letter of 3 March 2014 was within the s 24 time limits then no point arises. If it is not, then that will be a matter for the Family Court.
Should I retain the case?
[41] Mr Cummings pointed out that on an appeal from a decision of a Family Court, the High Court can make any decision or decisions it thinks should have been made.16 He submits that Ms DLR has lost faith in the Family Court and that I should hear and determine any dispute I rule is outstanding between the parties rather than send it back to the Family Court.
[42] First, Parliament conferred primary jurisdiction in this area on the Family Court, not on the High Court. Secondly, the matter I have found to be outstanding between the parties, the s 15 claim, has never been argued before the Family Court. Thirdly, from what I have gathered in going through the records of this case, Ms DLR is not altogether bereft of responsibility for the lengthy and difficult passage of the case through the processes of the Family Court.
Decision
[43] The Judge was correct to decide that the parties had settled their disputes. This ground of appeal fails.
[44] The Judge erred in ordering Ms DLR to pay the costs of counsel assisting. The order is quashed.
[45] Ms DLR is entitled to pursue a s 15 claim subject to the provisions of s 24 of the Act as to time limits. I remit the s 15 claim to the Family Court for determination on the basis that notice of the claim was given by Mr Cummings in his letter of
3 March 2014.
[46] I decline to retain Ms DLR’s case in the High Court.
16 Property (Relationships) Act 1976, s 39(3) and District Courts Act 1947, s 76.
Costs
[47] Costs generally follow the event. But, given the mixed success of the appeal, I rule that costs will lie where they fall.
Brewer J
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