IA v RRN
[2017] NZHC 1997
•21 August 2017
PUBLICATION OF THE NAME(S) OR IDENTIFYING PARTICULAR(S) OF THE PARTY(IES) TO THIS PROCEEDING OR THE CHILD/CHILDREN WHO ARE THE SUBJECT OF THIS PROCEEDING IS PROHIBITED UNDER S 139 OF THE CARE OF CHILDREN ACT 2004, AND S 11B(3) OF THE FAMILY COURTS ACT 1980 EXCEPT AS PERMITTED BY S 11B(4) OF THE FAMILY COURTS ACT 1980. THESE PROVISIONS GENERALLY PROHIBIT THE PUBLICATION OF IDENTIFYING DETAILS EXCEPT IN CERTAIN CIRCUMSTANCES IN PROFESSIONAL AND TECHNICAL PUBLICATIONS OR BY LEAVE OF A JUDGE.
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CIV-2015-404-003138 [2017] NZHC 1997
UNDER Care of Children act 2004 IN THE MATTER
of Application for Leave to Appeal Against a Judgment of the Family Court under section 143(2) of the Care of Children Act 2004
BETWEEN
IA Appellant
AND
RRN Respondent
Hearing: On the papers Counsel:
S Sharma for the Appellant
G M Cameron for the Respondent
P Leʼauʼanae for the ChildJudgment:
21 August 2017
COSTS JUDGMENT OF MUIR J
This judgment was delivered by me on Monday 21 August 2017 at 3.00 pm
Pursuant to Rule 11.5 of the High court Rules.
Registrar/Deputy Registrar
Date:…………………………
IA v RRN [2017] NZHC 1997 [21 August 2017]
Background
[1] On 12 June 2017 I granted the appellant’s appeal on the papers after an earlier hearing on 3 May 2017 which I was requested to adjourn by consent.1 The background is set out in detail in my judgment and will not be repeated suffice to say that:
(a) The appeal arose out of a final order of the Family Court granted on a
without notice application to relocate the parties’ child to Australia.
(b)The Family Court did not in fact have jurisdiction under the Family Court Rules 2002 (the Rules) to grant such application on a final basis.
(c) The Notice of Appeal dated 16 May 2016 did not specifically address the jurisdiction issue, referring generally to the decision having been made without notice and as constituting a miscarriage of justice but not engaging the relevant provisions of the Rules.
(d)In submissions subsequently filed, however, the appellant identified the jurisdictional issue.2
(e) Counsel for the respondent conceded that issue and responsibly also conceded that the likely result would be to grant the appeal. Such was done in advance of the hearing on 3 May 2017.3
(f) In my decision allowing the appeal I reserved costs in the event these were sought by the appellant.
[2] The appellant now seeks costs on both his application for leave to appeal
(similarly reserved) and appeal. There is no dispute that, applying relevant time allocations and daily recovery rates on the 2B basis previously identified as
1 IA v RRN [2017] NZHC 1268.
2 Submissions of appellant dated 27 July 2016.
3 Submissions of respondent dated 30 April 2017.
governing the appeal, the appropriate award in the appellant’s favour would be
$16,167.50.
Submissions
[3] The appellant submits that the normal principles as to costs under the High Court Rules should apply, namely that costs should follow the event. He relies on the decision of Cooper J in DLB v DLS (No 2).4
[4] The respondent opposes the application for costs on the grounds that the Court has a discretion not to award costs in Care of Children Act 2004 (COCA) proceedings if the best interests of the child require it. She says that in this case, an award of costs against her is not in the best interests of the parties’ nine-year-old son.
[5] The respondent has filed an affidavit in which she details her financial difficulties. She has incurred significant legal fees for which she has had to borrow from family members and has had to make numerous trips to New Zealand to attend settlement meetings and court hearings. Once her weekly expenses (including expenses associated with the education of the parties’ son) are deducted from her net income, she has a weekly surplus of $15. She has negligible ($5,000) net assets.
[6] For the respondent Mr Cameron raises as an additional issue the costs of lawyer for the child (Mr Le’au’anae). He submits that the respondent should not be required to reimburse the costs of lawyer for the child, for the same reasons as those stated above.
Issues
Should the respondent pay the appellant’s costs?
[7] There are two provisions of the COCA which are relevant. Section 142 governs costs generally under the COCA:
4 DLB v DLS (No 2) (2006) 25 FRNZ 876 (HC).
142 Costs
(1) In any proceedings under this Act, the court may make any order as to costs as it thinks fit.
(2) An order under this section may be made either in addition to, or instead of, an order under section 71 or section 87 or section 121.5
(3) This section is subject to sections 131 and 135.6
[8] The wording of s 142(1) is identical to that used in s 27B of the predecessor legislation, the Guardianship Act 1968.
[9] Section 143 of the COCA is also relevant:
143 Appeals to the High Court
(1) This subsection applies to a decision of a Family Court or District Court, in proceedings under this Act (other than criminal proceedings), to—
(a) make or refuse to make an order (other than an interlocutory or interim order); or
(b) dismiss the proceedings; or
(c) otherwise finally determine the proceedings.
…
(4) The High Court Rules and sections 73 to 78 of the District Courts Act 1947, with all necessary modifications, apply to an appeal under this section as if it were an appeal under section 72 of that Act.
(5) On the ex parte application of the appellant, the Family Court or District Court (as the case may be) may order that the appellant must not be required under section 74(1) of the District Courts Act 1947 to give the Registrar of the High Court security for costs.
(6) Subsection (5) overrides subsection (4).
[10] On its face, the relationship between the costs provisions of the High Court
Rules and s 142 of the COCA is unclear. In the High Court, it is accepted that costs
5 Section 71 relates to costs incurred following the contravention of a parenting order; s 87 relates to the costs following the contravention of an overseas parenting order; and s 121 relates to costs incurred in returning a child who has been abducted to New Zealand. None of these are relevant to the present case.
6 Section 131 provides that the fees and expenses of a lawyer for child or a lawyer appointed to assist the court must be paid out of public funds; and s 135 provides that the cost of any report requested under s 133 must also be paid out of public funds. These provisions will be discussed further in the context of Mr Le’au’anae’s costs below.
generally follow the event.7 In the Family Court, however, the best interests of the child are the primary guiding consideration in deciding whether or not to award costs.8 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.9 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 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.10
[11] The question is whether the High Court will apply the same child-centred approach to costs in COCA decisions on appeal, or the ordinary presumption that costs follow the event. There has been conflicting authority on this point, although I consider that the conflict has now been resolved.
[12] The 2002 decision in H v A concerned an application for costs in relation to an appeal hearing in the High Court by the successful respondent in a custody case.11
Panckhurst J favoured a COCA-specific approach:
[17] To summarise, I consider that a number of points can be made. Section 27B confers an unfettered discretion, but one to be exercised on a reasoned and principled basis. In custody and access appeals to this Court costs do not necessarily follow the event. This follows in part from s 23 of the Act, whereby the welfare of children is “the first and paramount consideration”. Where, for example, on the break up of a marriage parties genuinely seek the assistance of the Court in resolving issues affecting their children, and do so in the interests of such children, then a costs award may be inappropriate. Where, by contrast, one or both parties unnecessarily prolong litigation, contrary to the interests of the children involved, then costs may well be awarded. If an award is made the same matters as affect and inform costs decisions generally will need to be considered, as well as the impact which making an order may genuinely have upon the welfare of the children who are the subject of the proceeding. Such impact may be an economic one, or an emotional one (in terms of the likely influence upon the attitude of the parent concerned), or both.
7 High Court Rules 2016, r 14.2(a); Manukau Golf Club Inc v Shoye Ventures Ltd [2012] NZSC
109, [2013] 1 NZLR 305 at [8].
8 See B v G (1994) 12 FRNZ 515 (HC).
9 R v S (2003) 22 FRNZ 1017 (HC)
10 R v S, above n 9.
11 H v A (2002) 22 FRNZ 447 (HC).
[13] However, in the later case DLB v DLS (No 2) (on which the appellant relies), Cooper J declined to follow that reasoning, setting out detailed reasons for his decision. He was particularly influenced by s 143(4) of the COCA, which provides that the High Court Rules apply to an appeal under s 143 including the relevant rules applicable to costs. Cooper J held:
[17] This analysis of the relevant statutory provisions strongly suggests that there should not be a special rule for cases concerning appeals from Family Court decisions under the Care of Children Act. Rather, it appears that the legislative intent is that such appeals should be subject to the normal considerations that apply to the determination of appeals to this Court regardless of subject matter.
[14] As noted above, the relevant provisions of the High Court Rules create a presumption that a successful party will be entitled to recover costs incurred in relation to that proceeding. Cooper J did not think such an approach would be inconsistent with the principles underpinning the COCA. However, he acknowledged that the court might appropriately exercise its discretion to award reduced costs or decline to award costs in cases where an award of full costs would
be genuinely contrary to the welfare and best interests of the child.12
[15] In G v Cox, the appellant sought leave to appeal against a High Court decision in which Heath J declined to award costs to her.13 The Court of Appeal declined leave but held:
[26] We did not hear full argument on these decisions and so the following remarks are preliminary only. In our view, the starting point must be section 4(1) of the CCA. This provides that the welfare and best interests of the child must be the first and paramount consideration both in the administration of the CCA, including any proceedings under the Act, and in any other proceedings involving the guardianship of, day-to-day care of or contact with the child. The High Court Rules, as subordinate legislation, have to be interpreted in accordance with that principle.
[27] Our preliminary view is that this favours the approach to costs outlined in H v A where the welfare of the child is the overriding and paramount consideration (as required by s 4 of the CCA). However, it seems to us that the conflict between the two decisions may be more apparent than real. Although Cooper J would start with the High Court Rules, he did acknowledge that the welfare and best interests of the child may well legitimately override the normal rules as to costs.
12 At [21].
13 G v Cox [2008] NZCA 146.
[28] We would also accept, as pointed out by Cooper J, that different considerations might arise on appeal than in the lower court. While parents should not be discouraged from raising all genuine and responsible arguments they believe to be in the best interests of the child in the lower court, the same might not apply on appeal given that litigation and uncertainty will be prolonged – see E v C [1995] 3 NZLR 310 at 314.
[16] The Court of Appeal subsequently applied this reasoning in Arumalla v Kilari.14 The Court awarded costs against the respondent in that case on the basis that his application at first instance had been totally misconceived and misleading in several aspects.15 Numerous decisions of the High Court have also since followed the approach suggested in G v Cox and declined to award costs in COCA appeals.16
Duffy J summarised the relevant principles in B v B:17
[9] Although the Court of Appeal in [G] v Cox makes it clear that its view is a preliminary one only, its synthesis of the two High Court decisions is a helpful pointer to the approach to be taken in a costs application. The principles which may be derived from the judgment are that the welfare and interests of the subject child or children are the starting point and the vantage-point from which other considerations should be viewed. The other considerations include those identified by Panckhurst J in H v A, such as the forum in which the costs are sought, since different considerations can arise on appeal than in the lower Court, and the normal rules as to costs in this Court. To these I would add a further consideration; this is the respective parties’ reasons and motives for bringing or resisting an appeal and how they might be influenced by the availability or otherwise of an award of costs. This additional consideration is relevant because the cases reveal that the reasons and motives for bringing or resisting an appeal have influenced judgments on costs.
[17] In summary, therefore, although the issue has not been finally resolved at Court of Appeal level, I consider the weight of authority favours taking a child- centred approach to costs awards in COCA decisions on appeal. In that context there is no presumption that costs will follow the event.
[18] In my view this approach appropriately reflects New Zealand’s obligations
under article 3(1) of the Convention on the Rights of the Child in terms:
14 Arumalla v Kilari [2009] NZCA 361, (2009) 19 PRNZ 773 at [10].
15 At [18].
16 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 per Woodhouse J. Compare Burch v Hewlett [2016] NZHC 365 per Davison J.
17 B v B (2008) 27 FRNZ 289 (HC). See also the recent decision in LV v SOO [2016] NZHC 1167 at [15], where Hinton J gave a similar summary of the principles.
In all actions concerning children, whether undertaken by public or private social welfare institutions, courts of law, administrative authorities or legislative bodies, the best interests of the child shall be a primary consideration.
[19] The respondent’s primary basis of opposition is the impact a costs award in the amount of $16,167.50 would have on the welfare of the child. I accept her evidence that although she and her sister have been able to purchase a home it has a large mortgage with the result she has minimal net assets. I further accept that, after allowance for extra tuition costs for the child of $100 per week and a reasonable entertainment and holiday allowance of $70 per week, her net income barely exceeds her outgoings. It is inevitable on this evidence that payment of the costs sought by the appellant would necessitate either bank borrowings or further borrowings from relatives. Whether the latter would be available is unknown, but relatives have already provided loans of $53,000 to meet legal fees. I accept that additional borrowings (at least of that magnitude), will impose a further burden on the respondent’s already marginal financial position which will ultimately reflect in her ability to provide at least some of the useful additional tuition the child is receiving and to ensure that his life is not reduced to the bare necessities.
[20] The case is also an unusual one to the extent that the respondent in good faith sought an order which in fact the Family Court was not entitled to grant, so that, although the respondent cannot be totally exonerated from responsibility in terms of what has occurred, part of the responsibility also lies with the Family Court for having granted an order in respect of which it did not have jurisdiction.
[21] I am also mindful of the fact that an earlier focus by the appellant on the specific jurisdictional problem could have resulted in more timely resolution. The challenge was one appropriately the subject of specific identification in the Notice of Appeal, although I accept the Family Court’s noncompliance with the requirements of r 416H(c), (d) or (e) was ultimately identified, approximately two and a half months later, in submissions filed by the appellant.
[22] However, in favour of the application for costs I take into account the appellant’s legitimate interest in having an order made without jurisdiction set aside and his success on the appeal.
[23] Also relevant is the fact that a year prior to the matter coming on for hearing before me, an offer was made by the appellant without prejudice save as to the costs which included terms that the relocation order be set aside with costs lying where they fell and the appellant undertaking not to bring Hague Convention proceedings until New Zealand courts had conducted a substantive hearing regarding relocation, contact and parenting arrangements. However, that offer was a composite package involving submission to the jurisdiction of the New Zealand courts on substantive matters, so it is not as significant in the present context as it would have been if limited simply to an offer to abandon any claim for costs if the order was set aside.
[24] Assessing the outcome of the application requires an element of “robust” justice. In my view some contribution could be made to the appellant’s costs without seriously impacting the child’s welfare but a mechanical approach resulting in an award of $16,167.50 would have such a material impact. In my view an award of approximately 35 per cent of the appellant’s arithmetical entitlements would do overall justice between the parties, particularly given the significant costs incurred by the respondent in facilitating access to the child in New Zealand since the relocation.
[25] I accordingly award costs to the appellant in the amount of $5,750.00. To facilitate appropriate arrangements, with the least possible prejudice to the child’s circumstances, I further direct that my order in favour of the appellant is to lie in Court (and not therefore be sealed) until a date six months hence, namely 21
February 2018. Such “cooling off period” may also give the appellant the opportunity to reflect carefully on whether enforcement of the order serves the overall best interests of his son. There is much work to be done by both appellant and respondent in re-establishing the father and son relationship and it states the obvious that enforcement of costs awards may be counterproductive to that end.
Should the respondent contribute to costs of lawyer for the child?
[26] Mr Cameron submits that the respondent should not be required to contribute to the costs of the lawyer for the child. The appellant does not address this point in his submissions.
[27] The costs of lawyer for the child are initially paid out of public money.18
However, s 135A of the COCA requires the parties to refund the Crown in equal shares a fixed proportion of the costs and expenses paid to lawyer for the child. The proportion of the total fees and expenses which the parties are required to pay is two- thirds.19 These proportions must be paid unless the Court is satisfied:
(a) that such an order would cause serious hardship to a party or to a dependent child of the party;20 or
(b)that, in the circumstances of the case, including the conduct of any party, it would be inappropriate for the party to pay one-third of the costs.21
[28] Serious hardship is defined in s 135A(5) of the COCA as follows:
serious hardship, in relation to a party or a dependent child of a party,—
(a) includes significant financial difficulties that arise because of—
(i) the party’s inability to meet minimum living expenses
according to normal community standards; or
(ii) the cost of medical treatment for an illness or injury of the party or a dependent child of the party; or
(iii) a serious illness suffered by the party or by a dependent child of the party; or
(iv) the cost of education for a dependent child of the party:
(b) does not include significant financial difficulties that arise because—
(i) the social activities and entertainment of the party or those of a dependent child of the party may be limited; or
(ii) the party is unable to afford goods or services that are expensive or of a high quality or standard according to normal community standards.
[29] Section 131(1)(a) of the COCA explains how the fees and expenses of a lawyer for the child are calculated. Section 131(2) states that an invoice for fees and
expenses rendered by a lawyer appointed for the child must be given to the Registrar
18 Care of Children Act 2004, s 131(1).
19 Family Courts (Prescribed Proportion of Professionals’ Costs) Regulations 2014, r 4.
20 Care of Children Act, s 135A(4)
21 Care of Children Act, s 135A(5).
of the court in which the proceedings were heard, and the Registrar may decide to adjust the amount of the invoice.
[30] Inquiries of the Registrar have been unable to locate an invoice from Mr Le’au’anae. Nor do I have submissions from the appellant in this respect.22 I reserve the issue therefore for later determination. If Mr Le’au’anae has not already provided his invoice he is to do so by 28 August 2017 with a copy to the parties.
[31] In turn, if the parties wish to contest their liability to pay one third each of Mr Le’au’anae’s costs, the parties are to provide their submissions on the application of s 135A by 11 September 2017. On a provisional basis I can however indicate that although allowances for the child’s extra tuition and holidays and entertainment are in my view relevant in the context of an award of inter partes costs, the definition of serious hardship in s 135(5)(b)(i) may well preclude their consideration in the
context of liability for the costs of counsel for the child.
Muir J
Counsel/Solicitors:
S Sharma, Barrister, Henderson
G M Cameron, Barrister, AucklandP Le’au’anae, Barrister, Manukau City
22 Compare H v C (2010) 28 FRNZ 161 (HC), where Woodhouse J was aware of the total fees and expenses of the lawyer for the child and received “extensive submissions” from both parties on this subject, meaning he was able to consider their respective financial positions and overall circumstances in detail before reaching a conclusion.
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