Donaldson v Perera

[2023] NZHC 2415

ANONYMISED VERSION

IN THE HIGH COURT OF NEW ZEALAND DUNEDIN REGISTRY

I TE KŌTI MATUA O AOTEAROA ŌTEPOTI ROHE

CIV-2023-412-17

[2023] NZHC 2415

BETWEEN

ALAN DONALDSON

Appellant

AND

ANNE PERERA

Respondent

Hearing:

22 August 2023

Appearances:

Appellant in person

P J Dickinson for Respondent

Judgment:

31 August 2023

JUDGMENT OF DUNNINGHAM J

This judgment was delivered by me on 31 August 2023 at 11.30 am, pursuant to r 11.5 of the High Court Rules

Registrar/Deputy Registrar Date:

DONALDSON v PERERA [2023] NZHC 2415 [31 August 2023]

[1]    In late 2021, the respondent, Ms Perera,  made  an  application  to  the  Family Court for parenting orders. Her former partner, Mr Donaldson, opposed the orders but then disengaged from the proceedings. The orders sought by Ms Perera were made with some amendments from the Family Court Judge.1 She then applied for costs, seeking a little over $4,000. On 30 January 2023, Judge Flatley ordered  Mr Donaldson to pay costs in the sum of $2,500.2

[2]    Mr Donaldson appeals that decision on the following grounds. The first is that Mr Donaldson made a complaint about lawyer for the child having a conflict of interest. He says the proceedings should have been put on hold until the complaint had been dealt with. Second, he says his actions by disengaging from the proceedings part way through did not cause Ms Perera to incur extra expense.  Finally, he says Ms Perera should meet her legal costs as it was she who wanted the parenting orders instead of relying on the existing arrangements.

[3]    At issue is whether any of these matters justify the costs order being set aside on appeal.

Background

[4]    The parties were in a relationship from late 2007, and their child was born in 2011. They separated in November 2015, but the separation was acrimonious. There have been ongoing disputes over care and contact arrangements with their child. In October 2021, Ms Perera applied for parenting orders saying that it was in their child’s interests for there to be “a settled care arrangement recorded in a Parenting Order”. Her application included a draft of proposed parenting orders sought.

[5]    Mr Donaldson was initially legally represented. He disagreed with the parenting orders proposed by Ms Perera and made alternative suggestions for the terms of the parenting order.

1      Perera v Donaldson [2022] NZFC 7615.

2      Perera v Donaldson [2023] NZFC 861.

[6]    Lawyer for the child, Ms Bridget Byers, was appointed in November 2021. She then met with each parent and with the child and filed a report on 20 January 2022. On 3 February 2022, the matter was set down for a judicial settlement conference.

[7]    On  31  May  2022,  shortly   before  the  judicial  settlement  conference,   Mr Donaldson’s lawyer, Ms Val Farrow, applied for an order declaring she was no longer solicitor acting for Mr Donaldson. In her affidavit, she advised as follows:

5.Mr Donaldson instructs that he does not inten[d] to appear at that conference, nor does he wish to pursue his defence to the application for a parenting order.

6.I have advised Mr Donaldson of the consequences of his non- participation, notably that orders will likely be made in his absence and in favour of the applicant. Mr Donaldson confirms his instructions are not to proceed and I am instructed to take no further steps in the proceedings.

…

8. I am further instructed to advise the Court that Mr Donaldson believes the Court process to have been biased in favour of the applicant.

[8]    At the judicial settlement conference on 2 June 2022, Ms Farrow was granted leave to withdraw. Mr Donaldson did not attend. The minute of Judge Somerville issued on the same date recorded that the proceedings would be adjourned for a formal proof hearing and gave the following warning to Mr Donaldson:

4.The Formal Proof Hearing will be the last opportunity for the Respondent father to appear before the Court and advise the Court what he is wanting for [the child]. If he does not appear his defence will be struck out and the Hearing will proceed on the evidence and Application only of Ms Perera, with the cost implications that his nonappearance entails.

5.The respondent is making his position clear at this time through his previous Counsel that he does not want to engage with the Court proceedings. However, the current situation is not suitable for [the child] and needs to be addressed. There needs to be certainty if a Court Order is made with the input [from] the Respondent father then that Order will stand.

[9]    Mr Donaldson says that  prior to  the formal  proof hearing  he discovered  Ms Byers had acted for Ms Perera during his separation. He says he wrote to the Court on 8 July 2022 complaining about this, but received no response. However, he

acknowledged he did not alert Ms Dickinson or the Judge to his concerns. He says he was justified in withdrawing from the proceedings when he learnt of this conflict of interest.

[10]   However, I have now obtained the documents sent to the Family Court which tell a slightly different story. They confirm that on 8 July 2022, Mr Donaldson sent an email to the Family Court Registry advising that he refused to take part in the hearing regarding the parenting orders because “Bridget [Byers] who is the lawyer for child is not fit to be doing her job”. He then enumerated a number of complaints, saying that she met with the child three times, all in the presence of the mother and he did not believe the care arrangement should change because it was a “50/50 care arrangement which I am happy with”. The letter concluded by saying “I will not be attending or involved in this court case as I feel victimised”.

[11]   The letter did not at any point suggest that Ms Byers had a conflict of interest. On 12 July, the Family Court registrar advised Mr Donaldson that if he wished to make a formal complaint about the lawyer for the child, he could do so to the Family Court co-ordinator and the relevant email address was supplied.

[12]   It seems he did refer his complaint to the Family Court co-ordinator because, on 28 July 2022, Ms Byers sent a letter to the Court responding to Mr Donaldson’s complaints. In it she rejects the complaints. In particular, she says that when she met with the child “neither parent was in the room” and she says she has “only sought to advocate for [the child’s] benefit on [the child’s] instructions to me”.

[13]   Ms Byers did not address the allegation of conflict of interest because it had not been made by then. It seems, however, in a subsequent email to the Family Court co-ordinator which is date stamped 29 July 2022, Mr Donaldson, for the first time, asserted that Ms Byers “represented [Ms Perera] in 2016 for Nicola Williams during our financial separation which is a conflict of interest”. However, the balance of the email is a response to Ms Byers’ letter and it concludes by saying:

I stand by my comments that Bridget is not fit to be a Lawyer for child, a lot of the information in her report has nothing to do with the care arrangements for [the child] and is more an attack on me. My personal life and information has nothing to do with this case and should be left out of it!

[14]   On 2 August 2022, the formal proof hearing proceeded. Further evidence was filed by Ms Perera. It was noted that Ms Perera had read the report of lawyer for the child, which reflected the child’s view and, as a consequence, proposed an amended arrangement which was closer to the existing arrangements.

[15]   Judge Turner issued a decision essentially confirming the parenting orders now proposed by Ms Perera, but taking care to address the detail of the arrangements including the changeovers, in order to avoid further conflict.3 In that regard, he noted: “It is unfortunate that such specific arrangements are necessary, but I am satisfied that this condition is appropriate given the conflict which exists between the parents.”4 Final parenting orders were made and costs were reserved.

[16]   Ms Perera then applied for costs. Her actual costs were $4,042.25 (which is less than scale costs) and she sought an order for that amount.

[17]   Mr Donaldson opposed an order for costs. The grounds for opposing were as follows:

I refused to attend the court proceedings due to the lawyer for child representing [Ms Perera] during our separation in 2016[.] During our [separation] in 2016 as this is a conflict of interest, bias  is  shown  in  Bridget Byers[’] reports. I made a complaint Bridget Byers the lawyer for the child in J[u]ly 2022 due to the conflict of interest, Not[h]ing was done so [I] refused to attend any meetings or court p[ro]ceedings due to the unfair circumstances[.] The Judge did not investigate the complaint and proceeded with the case without me present. The Judge did not make judgement on the complaint against the lawyer for child until the 27/09/22 after the case was finished and failed to mention the conflict of interest. The proceedings were actually sped up with less financial cost as no round table meetings were conducted whi[ch] actuall[y] cost less with lawyers fees.

I myself had to pay Lawyers costs of $4,365.72. Why should [I] have to pay Anne[’]s legal fees when she is who p[u]rsued the parenting agreement[.] Shouldn[’]t Anne be [responsible] for her legal cost?

[18]   The application for costs was determined by Judge Flatley in January 2023 on the papers.5 After setting out the principles which apply to the determination of costs, the Judge summarised the parties’ respective positions. Ms Perera claimed that if

3      Perera v Donaldson, above n 2.

4 At [18].

5      Perera v Donaldson, above n 3.

Mr Donaldson had not opposed her application at the outset the proceedings would have been straightforward and she would not have incurred the costs she was required to meet. However, Mr Donaldson claimed that he, too, had costs associated with the proceedings and, as it was Ms Perera who wanted the parenting order and chose to initiate the proceedings, she should pay the associated costs.

[19]   The Judge then observed that when a proceeding is resolved by taking into account issues raised by both parents and their respective positions with regard to suitable care and contact arrangements, then costs generally lie where they fall.6 However, here, the final order was made without any real reference to Mr Donaldson’s position because he withdrew. The Judge observed that the same outcome “could well have been achieved in the early stages of the proceeding without the need for the expense incurred”.7 However, he acknowledged that even if the orders had been made by consent, Ms Perera would have had to initiate proceedings and meet the relevant filing fees and there would have been costs associated with that.8 For that reason, he considered it appropriate to make an award of costs against Mr Donaldson in the sum of $2,500, saying that equated to the “unnecessary expense Ms [Perera] was put to”.9

Principles on an appeal of a costs decision

[20]   Costs are at the discretion of the Family Court Judge.10 They are to be determined according to ordinary costs principles.11 That said, the Family Court does not routinely award costs in proceedings under the Care of Children Act 2004. As Muir J said in IA v RRN:12

In the High Court, it is accepted that costs generally follow the event. In the Family Court, however, the best interests of the child are the primary guiding consideration in deciding whether or not to award costs. The Family Court is unlikely to make an adverse order for costs against a parent who advances a genuine and responsible argument in what he or she regards as the best interests of the child. Nevertheless, the Family Court retains a discretion to make a costs award against an unsuccessful party where the party has unreasonably prolonged litigation or otherwise conducted himself or herself

6 At [9].

7 At [10].

8 At [11].

9 At [12].

10     Family Court Rules 2002, r 207(1).

11     See r 207(2).

12     IA v RRN [2017] NZHC 1997, [2017] NZFLR 659 at [10] (footnotes omitted).

in a manner which has brought greater costs on another party or has caused detriment to the welfare of the child. In each case a balance may be struck.

[21]   As this is an appeal against the exercise of the discretion of the Family Court Judge to award costs, to succeed, Mr Donaldson must demonstrate the Judge made an error of law or principle, took into account irrelevant considerations, failed to take into account relevant considerations, or was plainly wrong.13

Discussion

[22]   As already noted, Mr Donaldson’s submissions focused on three areas. He said, first, his decision to withdraw from the proceedings was justified by the fact that Ms Byers had a conflict of interest. Secondly, he said that he did not increase the costs of the proceeding. Rather, his decision to not engage any further actually reduced costs. Finally, he said that as it was Ms Perera who wanted the Court orders, she should meet the costs of obtaining them.

[23]   In respect of the conflict of interest Mr Donaldson explained that he discovered Ms Byers’ name when searching through past emails in relation to the separation process. Clearly neither party recalled her brief involvement in the separation process at the time of her appointment. Furthermore, as the documents show, the allegation that Ms Byers had a conflict of interest was not communicated to either Ms Perera or a Family Court judge before the parenting orders were made.

[24]   Ms Perera first heard about the alleged conflict  of interest when she read   Mr Donaldson’s notice of opposition to costs in the Family Court. In her affidavit for this proceeding Ms Perera says:

14.The first I was aware of the Appellant’s claim was his [notice of opposition to costs in the Family Court] dated 12 October 2022 …

15.I was not a party to the Appellant’s complaint about Lawyer for Child and I was/am not appraised in any way about the complaint, nor that process.

16.In respect to the claim of conflict of interest, I was legally represented by Nicola Williams following my separation with the Appellant.

13     Kacem v Bashir [2010] NZSC 112, [2011] 2 NZLR 1 at [32]; and Harrington v Wilding [2019] NZCA 605 at [49].

17.After hearing the Appellant’s claim, I subsequently searched all my past  paperwork  and   discovered   an   email   in   2016   from Nicola Williams referring to [Bridget] Byers’ name. On one occasion around 5th April 2016 when Ms Williams was away and unavailable during that week, she had referred to Ms Byers. I do not recall ever meeting Ms Byers. I may have had a phone call with Ms Byers (but can not recall if  I  spoke  only  to  Ms  Williams  about  matters).  Ms Williams was available within days and remained my Lawyer. With all the emotion and distress I was under in 2016, I had no recollection of these 2 or 3 days.

18.On 22 November 2021, Ms Byers was appointed by the Family Court as Lawyer for Child. As above, I had no recollection of ever having any prior contact with Ms Byers.

[25]   I am satisfied Mr Donaldson did not raise the alleged conflict of interest in any communication until 29 July 2022 when he mentioned it, in passing, in an email to the Family Court co-ordinator. The logical inference is that he was not aware until then that there was a basis for claiming a conflict of interest. This was long after he had disengaged from the proceedings.

[26]   Given this issue was not the reason for Mr Donaldson disengaging from the proceedings and neither Ms Perera or Judge Turner was made aware of this issue until after orders were made, it was not a relevant consideration in respect of costs. Well before Mr Donaldson identified this as a potential problem, he had opposed the making of the orders, forcing the proceedings on to a standard track with a wasted judicial settlement conference that he did not attend, and requiring a formal proof hearing which needed to address the issues that he had raised in opposition to the making of the orders. The alleged conflict of interest does not explain his decisions to that point.

[27]   That said, it is unfortunate that the Judge did not address this allegation in his costs judgment as it has increased Mr Donaldson’s dissatisfaction with the process. However, the Judge had no information to support this allegation at that point. Furthermore, he had already ruled on the complaint by Mr Donaldson about the conduct of the lawyer for the child, rejecting the criticisms and concluding her report was “helpful” and provided a “well-rounded picture such that informed decisions could be made in accordance with [the child’s] instructions and in [the child’s] best interests”. However, in any event, as I have held, Mr Donaldson cannot attribute his conduct during the proceedings to this issue because he did not become aware of the

circumstances giving rise to the alleged conflict until 29 July 2022 and he never raised the issue with the Judge or Ms Perera during the parenting order proceedings.

[28]This ground of appeal fails.

[29]   The second ground is that Ms Perera incurred less cost as a consequence of him not defending the application. However, this submission misunderstands why costs were awarded. Had Mr Donaldson participated in good faith, and made submissions focussing on the interests of the child, his conduct could not have been criticised, even if it had involved both parties incurring more cost. As noted in [20] above, where parties are genuinely attempting to advance the interests of the child, even though their positions may differ, the Court will be reluctant to order costs.

[30]   What happened here was different. Mr Donaldson opposed the application, forcing it to proceed on a standard track rather than a simple track. This meant additional steps had to be taken, such as attendance at the wasted judicial settlement conference, and preparing further evidence for the formal proof hearing to address the issues raised, but not pursued, by Mr Donaldson. Had he not opposed the application from the outset, there is no doubt that Ms Perera would have incurred less cost. Costs were awarded against Mr Donaldson because of the way he conducted himself in the proceedings, first opposing them and then withdrawing. This neither advanced the interests of the child, nor did it avoid unnecessary costs for the applicant.

[31]   Furthermore, Mr Donaldson was on notice that his unconstructive stance may have cost consequences. Judge Somerville warned him that if the hearing proceeded on Ms Perera’s application alone, there would be cost implications for his non-appearance.14

[32]   I can find no error in the Family Court Judge making a costs award of approximately five eighths of Ms Perera’s actual costs in these circumstances. This reflected the fact that Ms Perera would have incurred costs in any event if she had simply sought the orders unopposed, but Mr Donaldson’s stance of opposing the proceedings and then refusing to engage in them put her to additional cost.

14 See above at [8].

[33]This ground of appeal fails.

[34]   Finally, Mr Donaldson argues that as Ms Perera sought the parenting orders, she should bear the costs of that application. However, that is not an applicable principle governing the award of costs. Costs focus on the outcome of the proceedings and the conduct of the parties during the proceedings, not on which party initiated them. Here, the Family Court found that the parties had been unable to reach agreement on shared care arrangements,15 and the Judge was clearly satisfied that it was appropriate to make parenting orders to give certainty given the ongoing level of conflict in this case. As the mother was, in substance, the successful party, she was entitled to costs.

[35]This ground of appeal, too, fails.

Costs on this application

[36]Finally, if successful, Ms Perera seeks costs on this costs application.

[37]   Although this was Mr Donaldson’s appeal, I note he approached it with a somewhat cavalier attitude. Despite careful directions from Harland J following telephone conferences on 17 April and 1 May 2023, Mr Donaldson failed to follow the directions she made. He filed no submissions, nor did he provide any documentation to the Court supporting the issues that he wished to raise. While I was provided the key documents from the Family Court file, they did not include documents which Mr Donaldson said were relevant to his appeal, including his complaint to the Family Court co-ordinator about Ms Byer’s appointment, and the Family Court’s subsequent decision on that issue dated 14 September 2022.

[38]   Ms Perera had to file submissions without Mr Donaldson providing any more detail on his appeal than contained in the notice of appeal. Furthermore, Ms Perera has been put to the expense of defending the appeal, including filing evidence on the newly raised issue of her prior involvement with Ms Byers.

15     Perera v Donaldson, above n 2, at [2].

[39]   Both as the successful party, and in light of Mr Donaldson’s unhelpful approach to running the appeal, Ms Perera is entitled to costs. That said, I am mindful of the interests of the child  and  the fact  an  ever-increasing  burden  of costs  on  Mr Donaldson will do nothing to improve the existing situation of conflict between him and Ms Perera.

[40]   Mr Donaldson has paid $795 as security for costs. In the interests of finality, I make a costs award in Ms Perera’s favour in that amount. The High Court Registry is directed to release those funds to Ms Perera.

Copy to:

P J Dickinson, Barrister, Dunedin Mr Donaldson, Appellant