Drake v Drake
[2024] NZHC 999
•30 April 2024
NOTE: PURSUANT TO S 139 OF THE CARE OF CHILDREN ACT 2004, ANY REPORT OF THIS PROCEEDING MUST COMPLY WITH SS 11B, 11C AND 11D OF THE FAMILY COURT ACT 1980. FOR FURTHER INFORMATION, PLEASE SEE
https://
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CIV-2023-443-24
[2024] NZHC 999
UNDER the Care of Children Act 2004 IN THE MATTER
of an appeal against a decision from the Family Court at [ ]
BETWEEN
MRS DRAKE
Appellant
AND
MR DRAKE
Respondent
Hearing: On the papers Counsel:
V A Crawshaw KC and B Jefferson for Appellant R S Stannard for Respondent
C A Gelston – lawyer for the child
Judgment:
30 April 2024
JUDGMENT OF RADICH J
(Costs)
[1] In my decision of 30 August 2023, I allowed an appeal against a Family Court decision1 in which orders were made for the shared care of a child, Jethro Drake, and for his relocation to the town in which his father, Mr Drake, lived.2 In allowing the appeal, I made orders that Jethro was to remain in the town in which his mother,
1 [Drake v Drake] [2023] NZFC 2975.
2 Drake v Drake [2023] NZHC 2390.
DRAKE v DRAKE [2024] NZHC 999 [30 April 2024]
Mrs Drake, lived but that the equal shared care orders made in the Family Court were to remain in place.
[2] Mrs Drake, Jethro’s mother and the successful appellant, seeks costs on a 2B basis, totalling $22,946. Mr Drake opposes the application, submitting that costs should lie where they fall or that a costs decision should at least wait until the outcome of the appeal from my decision that is pending in the Court of Appeal.
Memoranda on costs
[3] In [155] of my 30 August decision, I said it may be that, in the interests of fostering positive relations between Jethro and both of his parents, the parties would wish to let costs issues rest. I said that, however, in the event that costs were sought, memoranda could be filed, giving 15 working days for a memorandum from the appellant and a further 15 working days for a memorandum from the respondent.
[4] Memoranda were filed by the appellant and by the respondent on 20 September and 11 October respectively. However, as I said in my minute of 8 April 2024, the memoranda were referred to me only on 7 April 2024. As I mentioned, it is not clear what had occurred but it would appear that the memoranda were filed and then not referred on. As I said, that is regretted. I said that, given the passage of time, counsel may wish to file brief updating memoranda within 10 working days. I observed that counsel for the respondent had said in the 11 October 2023 memorandum that the respondent wishes to be heard on the question of costs. I said that the Court’s usual practice is to deal with applications for costs on the papers unless there is a particular reason or need for a hearing. I asked counsel for the parties to address that point.
[5] In an updating memorandum of 12 April 2024, counsel for the appellant reiterated the appellant’s position on costs and said that they did not see a particular reason or need for an oral hearing. A further memorandum has not been received from counsel for the respondent and so I have proceeded to determine the costs application on the papers.
Costs in disputes involving children
[6] The starting point in any consideration of costs is that all matters are at the discretion of the Court.3 Under r 14.2 of the High Court Rules 2016, a set of general principles apply to the determination of costs. They include the principle that a party who fails in a proceeding should pay the costs to the party who succeeds,4 the principle that costs should be assessed by applying the appropriate daily recovery rate to the time considered reasonable for each step in the proceeding (in accordance with related provisions prescribing the recovery rates and providing for those steps)5 and the principle that “so far as possible the determination of costs should be predictable and expeditious”.6
[7] As the Supreme Court has said, a Court’s discretion in awarding costs should generally be exercised in accordance with the costs provisions in the High Court Rules unless there is good reason to take a different approach.7 While costs should in most cases be assessed in accordance with the schedular approach in the rules, involving the multiplication of steps taken in a proceeding by a daily recovery rate, a range of exceptions apply. One of them is found in r 14.7 under which the Court may refuse to make an order for costs or may reduce the costs otherwise payable under the rules if one of the factors listed there applies. Under r 14.7(g), the Court may refuse to make an order for costs or may reduce the costs otherwise payable under the rules if “some other reason exists which justifies the court refusing costs or reducing costs despite the principle that the determination of costs should be predictable and expeditious”.
[8] As has been said, the discretion in r 14.7(g) is broad but requires the identification of a good reason to depart from ordinary costs principles, including that costs should follow the event.8
[9] This appeal was brought under s 143 of the Care of Children Act 2004. Because the appeal is a proceeding under that Act, the starting point for the Court in
3 High Court Rules 2016, r 14.1.
4 Rule 14.2(1)(a).
5 Rules 14.2(1)(c)–(e), 14.4 and 14.5.
6 Rule 14.2(1)(g).
7 Shirley v Wairarapa District Health Board [2006] NZSC 63, [2006] 3 NZLR 523.
8 Taylor v District Court at North Shore (No. 2) HC Auckland CIV-2009-404-2350, 13 October 2010 at [10].
considering the exercise of its discretion on costs, must be the welfare and best interests of the child.9
[10] In Hawthorne v Cox, the Court of Appeal said that a child’s welfare and best interests is the “first and paramount consideration” in costs decisions relating to the guardianship, day-to-day care of or contact with the child.10 The Court endorsed the views of Panckhurst J in H v A that it is necessary to assess the impact that a costs award would have on a child’s parents and their ability to care for the child and to work cooperatively in the child’s best interests.11
[11] Since then, several decisions in the High Court have followed the approach in Hawthorne and have declined to award costs in appeals under the Care of Children Act12 or have awarded reduced costs13 on the basis that a higher award would impact negatively the welfare and best interests of the child. In awarding reduced costs, Osborne J has said that, when taking a child-centred approach to costs awards under Care of Children Act decisions on appeal, there is no presumption that costs will follow the event.14
[12]In a decision of the Full Bench of the High Court in R v S, it was said:15
… it is wrong in principle 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. If costs orders are made in those circumstances they may operate as a disincentive for such arguments to be put to the Court. As the Family Court, in guardianship proceedings, exercises an inquisitorial jurisdiction it is important that all relevant arguments be put before the Court.
[13] Accordingly, the presumption that costs should follow the event in such cases is able to be displaced if circumstances such as those discussed in R v S are present,
9 The discretion, in s 142 of the Care of Children Act 2004, to award costs under that Act, is to be informed by the purposes of that Act which are set out in s 4 and which include the welfare and bests interests of the child: Hawthorne v Cox [2008] NZCA 146 at [26]–[28]; Arumalla v Kilari [2009] NZCA 361, (2009) 19 PRNZ 773 at [10].
10 Hawthorne v Cox, above n 9, at [26].
11 At [26], citing H v A (2002) 22 FRNZ 447 (HC).
12 See H v M [2015] NZHC 3244 per Keane J; TEJ v ROJ [2014] NZHC 3406 per Keane J; D v G [2013] NZHC 1727 per Keane J; Palmer v Holm [2015] NZHC 226 per Gilbert J; H v C (2010) 28 FRNZ 161, [2010] NZFLR 1055 per Woodhouse J.
13 See IA v RRN [2017] NZHC 1997, [2017] NZFLR 659.
14 At [17].15 R v S [2004] NZFLR 207, (2003) 22 FRNZ 1017 at [63].
that is to say, if the losing parent made genuine and responsible arguments and if the welfare of the child would be adversely affected.
[14] As Cooke J said recently, (albeit in a slightly different context involving arguments about unreasonable behaviour), it is important that parties in Family Court proceedings remain engaged and do not perceive that the system is against them when they are dealing with difficult personal matters.16
[15]Several principles emerge:
(a)Any costs award in proceedings under the Care of Children Act must align with the welfare and best interests of the child. This is the paramount consideration.
(b)The welfare and best interests of the child include consideration of the impact that a costs award might have on a parent’s ability to care for the child and on the ability of both parents to work together in the child’s best interests.
(c)These considerations can affect materially the presumption that costs will follow the event.
(d)The presumption may largely be displaced if the unsuccessful party advanced a genuine and reasonable argument in what they believe to be the best interests of the child. What is reasonable may be influenced by the extent to which, if at all, the appeal prolonged the litigation and, therefore, increased the inherent uncertainty faced by the child.
Discussion
[16] I do not see it as being appropriate for the determination of costs in this Court to await the outcome of the appeal in the Court of Appeal. Moreover, in settling costs
16 Adams v Watcher [2021] NZHC 432 at [17].
now, the decision is able to be considered in the Court of Appeal if the parties wish for that to occur.
[17] I accept that making an award of costs in Mrs Drake’s favour would impact adversely upon the welfare and best interests of Jethro. It is said for Mrs Drake that an award of costs against Mr Drake would not impact upon Jethro’s welfare and best interests and that Mr Drake has the means to meet an award of costs. It is said that the substantive care arrangements for Jethro will depend ultimately on whether Mr Drake elects to relocate from Town B to Town A, where Jethro is living in accordance with the parenting orders that are in place. It is said that, until then, Mrs Drake is incurring the day-to-day costs of having Jethro in her care.
[18] It is said for Mr Drake that a costs award against him would mean that, effectively, he would no longer be able to visit Jethro as he does now. It is said that Mr Drake would be unable to afford to travel from Town B, his place of residence, to Town A, to see Jethro, at least not regularly. It is said that, in addition, it would mean that Mr Drake would be unable to afford to move and live in Town A, should that be needed. Reference is made to Mr Drake’s modest annual income, material parts of which are spent on the costs of his travel from Town B to Town A on a fortnightly basis to see Jethro. These costs, together with child support payments made by Mr Drake, are significant for him.
[19] I accept the point made by Mr Drake to the effect that a costs award against him, in the sum that Mrs Drake is seeking, or even on a reduced basis, would absorb a substantial part of his annual income. He defended the appeal in what I accept to be a general and responsible way and in accordance with his beliefs about Jethro’s best interests. A costs award would be a significant barrier to him maintaining contact with Jethro. And for Jethro to have no, or most likely reduced, contact with his father would certainly be contrary to his welfare and best interests. I accept the submissions made for Mr Drake to the effect that this is all the more so in light of evidence before the Court about a lack of contact risking a severance of the relationship between Jethro and his father in its entirety.
[20] It is said for Mrs Drake that both parties should have been aware that there was a risk that costs would be awarded in the event that they were unsuccessful on appeal. That is so but it cannot override the paramount consideration of Jethro’s welfare and best interests.
[21] By way of contrast, there is no evidence that, in declining to make a costs award, Jethro’s welfare and best interests would be adversely affected through any form of impact on Mrs Drake. I do acknowledge that she has needed to take a sizeable bank loan to meet her legal costs but, in light of her annual income and in any event, there is no suggestion that, in declining costs, Jethro’s welfare would be impacted negatively.
[22] For the reasons given, I accept that Jethro’s welfare and best interests would be adversely affected should an award of costs be made. I accept that Mr Drake has advanced his position in this proceeding genuinely and reasonably and has acted in what he considers to be Jethro’s best interests. In these circumstances, it is in my view right that the costs presumption be displaced.
[23]Accordingly, costs will lie where they fall.
Radich J
Solicitors:
Haigh Lyon, Auckland for Appellant
Govett Quilliam, New Plymouth for Respondent
0
7
0