TEJ v ROJ
[2014] NZHC 3406
•22 December 2014
NOTE: PURSUANT TO S 139 OF THE CARE OF CHILDREN ACT 2004, 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-2012-404-4110 [2014] NZHC 3406
IN THE MATTER OF an appeal under s 143(1)(c)(ii) of the Care
of Children Act 2004
BETWEEN
TEJ Appellant
AND
ROJ Respondent
Hearing: On the papers Counsel:
R C Knight for Appellant
J Robertson for Respondent
C Elliott for ChildrenJudgment:
22 December 2014
JUDGMENT OF KEANE J
This judgment was delivered by me on 22 December 2014 at 4pm pursuant to r 11.5 of the High Court Rules.
Registrar/Deputy Registrar
Solicitors/Counsel
Martelli McKegg, Auckland
R C Knight, Auckland
Wynyard Wood, AucklandJ Robertson, Auckland
C Elliott, Auckland
TEJ v ROJ [2014] NZHC 3406 [22 December 2014]
[1] On 20 June 2012 in the Family Court, Auckland, Judge Fleming granted the application of the respondent, Mr J, for an order entitling him to relocate the children of his marriage with Ms J to the United States of America.1 Mr J did not seek any order as to costs. Nor was any order made.
[2] On 18 March 2013, relying to a significant degree on fresh evidence and psychiatric and psychological reports, allowed in on the appeal, Allan J granted Ms J’s appeal and quashed the relocation order.2 He made parenting orders dividing the care of the children between their parents almost equally. He reserved costs and directed that memoranda be filed if agreement could not be achieved.
[3] On 8 July 2012 the Court of Appeal declined Mr J leave to appeal on the ground that it lacked the jurisdiction to hear his intended appeal.3 It granted costs in favour of Ms J, who now seeks an award in this Court; an application I must resolve because Allan J has retired.
Cost application
[4] Ms J seeks costs on the ordinary principle that costs follow the event. This is not a case, she contends, where the paramount interests of the children should preclude any award. Mr J was unduly adversarial on the appeal, and on the case as a whole.
[5] On this appeal alone, Ms J says, she has incurred $117,020 legal costs. She seeks costs amounting to $43,680.50, a scale 2B award augmented by a claim for second counsel and by scale 2C costs on an application for stay and for the preparation of the case book. She also seeks $9,064 disbursements, making the total award she claims, $52,745.27.
[6] Mr J opposes any award. He contends that, in contesting the appeal and earlier the stay, he was not unduly adversarial. He was seeking only to advance the
paramount interests of the children consistent with the decision of the Family Court
1 J v J FC Auckland FAM-2011-044-153, 20 June 2012.
2 TEJ v ROJ [2013] NZHC 511.
3 ROF v TEJ [2013] NZCA 323.
in his favour; a decision entitling him to seek costs himself. His own costs on the appeal came to $95,000. He has family debts exceeding $260,000. In the last year or more he has had to return to the United States to earn an income.
Costs principles
[7] Section 142(1) of the Care of Children Act 2004, which says quite shortly, ‘In any proceeding under this Act, the Court may make any order as to costs it thinks fit’, leaves unanswered whether costs should be awarded on conventional principles or only when an award is consistent with the s 4 principle making the welfare of the children ‘the first and paramount consideration’.
[8] In Hawthorne v Cox the Court of Appeal expressed the preliminary opinion that the s 4 principle must be the overriding consideration. The Court said:4
In our view, the starting point must be s 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.
[9] The Court went on to say that it therefore preferred the approach to costs taken in H v A (Costs)5 by Panckhurst J, holding s 4(1) must be paramount, in contrast to that expressed by Cooper J in B v S (No 2, giving first place to conventional costs principles.6
[10] The Court said, however, that the distinction between the two might be more apparent than real, because Cooper J acknowledged that ‘the welfare and best interests of the child may well legitimately override the normal rules as to costs’.7
The Court also accepted that while parents should not at first instance be discouraged from pursuing what they believe to be their children’s best interests, that might be
less justifiable on an appeal ‘given that litigation and uncertainty will be prolonged’.8
4 Hawthorne v Cox [2008] NZCA 146 at [26].
5 H v A (Costs) (2002) 22 FRNZ 447 at [20].
6 At [17].
7 At [27].
[11] In H v A (Costs), the decision the Court of Appeal endorsed, Panckhurst J held that conventional cost principles should be exercised consistently with s 4(1) of the CCA recognising:9
… the impact which making an order may genuinely have on the welfare of children who are the subject of the proceedings. 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.
[12] On that principle, Panckhurst J held, an award of costs might not be justifiable under s 142 where the contesting parents ‘genuinely seek the assistance of the Court in resolving issues affecting their children, and do so in the interests of such children’. An award might be entirely appropriate, he held, ‘where … one or both parties unnecessarily prolong litigation, contrary to the interests of the children involved’.
[13] On this present application I must resolve whether Mr J’s conduct on the appeal lay in the first category or the second, set primarily against Allan J’s decision, which I will now set out in essence. I will take Duffy J’s earlier decision into account in my conclusions.
Decision on appeal
[14] Mr J and Ms J are United States citizens. They married in the United States in 1998 and their daughter was born there in 2005, as was their son in 2007. In 2010 they began to live in New Zealand having applied for and obtained permanent residency. In early 2011 they separated. Ms J began to live with her present partner. They began then to divide by agreement their children’s care.
[15] On 28 January 2011 Ms J obtained without notice an order in the Family
Court preventing the removal of the children from New Zealand and on 19 February
2011 Mr J filed in the Oregon Courts a petition for dissolution of their marriage. In March 2011 they filed in the Family Court cross applications for parenting orders and in April 2011 Mr J applied for an order permitting the children to be relocated to
the United States. On 25 July 2011 Judge Ryan held that decisions in the Oregon proceedings did not bind the Family Court.
[16] Despite that, in August 2011 there was a hearing before the Court in Oregon as a result of which Mr J was awarded sole custody until further order, and held to be entitled to decide where the children should live. Ms J was to return one of the children’s passports to him immediately. They were to share day to day care but the children were to return to the United States. Their paternal grandfather was seriously ill.
[17] On 19 August 2011 Mr J applied to the Family Court for an order discharging the interim order preventing removal of the children from New Zealand. Eventually, that application was overtaken by the cross applications. On 20 June 2012, after a three day hearing in the Family Court, Judge Fleming made the order in Mr J’s favour permitting the children to be relocated to Oregon with him. She considered that Ms J, despite her evidence suggesting the contrary, would go where the children were.
[18] In making that order, Judge Fleming also imposed three conditions: (i) Mr J was to obtain a discharge of the Oregon Court custody order; (ii) he was, on his undertaking, to do everything necessary to ensure that her orders were registered in Oregon; (iii) he was to cooperate with Ms J in obtaining orders in Oregon reflecting those made.
[19] On 24 July 2012, as Allan J held ‘somewhat curiously’, Mr J applied to the Family Court for an order discharging the order preventing the removal of the children from the jurisdiction, ostensibly to give effect to Judge Fleming’s order but, as Allan J held, inconsistently with her decision at least insofar as it was an application made without notice.
[20] On 13 August 2012 Duffy J granted by consent a stay of that application until the hearing of the appeal. She granted Ms J leave to adduce further evidence on the appeal, but less than she wished to, and on the appeal itself Allan J struck out some
of the evidence Ms J then filed, holding that it exceeded the leave granted. He also received psychiatric and psychological evidence and spoke to the children himself.
[21] In then granting Ms J leave to appeal and in granting her appeal and quashing the relocation order, Allan summarised his reasons as follows:
(a) Judge Fleming undertook her assessment in the light of her understanding that there was effective agreement by the end of the hearing before her that Ms J would follow the children if there was a relocation order. It seems clear now that Ms J did not intend to convey any such concession or agreement. It is however, a proper inference in my view that, very much against her will, she would return to the United States if the children left New Zealand pursuant to a relocation order, though at a significant personal and financial cost to her. But there is a limited possibility that she would not.
(b) If the appeal succeeds Mr J will remain in New Zealand, but again at some emotional and financial cost. Neither party contends that an adverse outcome would so seriously impact upon his or her physical or mental health, to the point that there would be consequences for the welfare and best interests of the children. In consequence of the appeal succeeding, I consider that Mr J will be no worse off in New Zealand than would Ms J in the United States if the appeal had failed.
(c) The children’s primary need is to continue the present shared care arrangements. Their primary attachment is to their parents, rather than to any particular locale. Given my conclusion that both parents would seek to live in the same country as the children, the shared care arrangement will not be in jeopardy whichever country the children end up residing in. The question then becomes which country would best serve the children’s best interests in the light of the s 5 principles.
(d) In my view, the children’s needs over the next few years can be met adequately both in New Zealand and the United States, although it seems on the evidence that an equivalent or better education can be obtained here rather more cheaply than would be the case in Oregon. New Zealand confers a number of lifestyle advantages, although I heard little or no argument about the extent to which Oregon can or cannot provide a similarly positive environment.
(e) It is significant that both parties jointly agreed to come to New Zealand, at least for the earlier part of the children’s lives, on the basis that it would provide a better life than they had in Oregon. This lends credence to Ms J’s argument that the parties considered that an upbringing in New Zealand would best serve the children’s interests. Nothing has occurred to suggest that this has changed, even though Mr J is understandably upset at the breakdown of his marriage, and wishes to return to more familiar surroundings. The children are flourishing in New Zealand. There are indications that Mr J could flourish too if he chose to put down roots here.
(f) While I do not accord the status quo any special weight in the predictive assessment, relocation would undoubtedly result in substantial disruption to the children’s social, familial and educational routines for a time.
(g) While the parties have co-operated adequately on a superficial level, their underlying relationship at this point is to some degree adversarial. There is a risk that Ms J may not return to the United States, if the appeal failed. Should this occur, I have serious doubts as to Mr J’s willingness to foster the children’s relationship with her.
(h) I do not consider cultural and heritage issues to be of very significant weight. The children’s Native American connection will not be greatly prejudiced by living in New Zealand. It is only one part of their cultural background – other aspects include Lebanese heritage from Ms J’s side. Their more general American heritage can be preserved even if they are not living in the United States, given its overall strength and pervasiveness. But I accept that their American links may not be strengthened as they would in the United States.
(i) I do not underestimate the disadvantage inherent in the children living at a distance from their extended family, and in particular, their grandparents. However, the children have been able to maintain contact by other means. Their grandparents can also made trips to New Zealand, as has already occurred. And as the children grow older, trips by them to the United States become easier.
[22] In his preceding analysis Allan J was only critical of Mr J, when speaking about the need for the parents to consult and cooperate with each other about their children’s care. He said this:10
Although in many respects Mr J has co-operated with Ms J in relation to the children’s welfare, there have been times when he has engaged in what amounts to adversarial tactics. His decision to pay $250,000 of relationship property into a trust fund without consulting Ms J was, to say the least, high handed. Moreover, there has been no real explanation for his decision to resort to the Oregon Courts when he knew the New Zealand Family Court was already seized of issues relating to the children, and the Oregon Court could not bind the Family Court here.
Conclusions
[23] In his decision Allan J reserved the question of costs on the appeal without indicating whether he thought an award proper. I must, as I have said, assess that issue against the decision he gave and against that of Duffy J on the preliminary
matters. I do so taking into account the following considerations.
10 TEJ v ROJ, above n 2, at [167].
[24] Firstly, on the appeal, Allan J re-evaluated the factors for and against relocation with clearer and more complete evidence as to Ms J’s position, and with the benefit of the psychological and psychiatric reports. As to some factors he agreed with Judge Fleming. As to others he differed. His reasons, which I have set out, demonstrate that he found the issue finely poised. He accepted that Mr J’s concerns were legitimate.
[25] Secondly, the reasons Ms J advances for contending that Mr J was unduly adversarial largely lie beyond the appeal. Mr J’s Oregon proceedings, immediately after they separated, were not unreasonable initially and, in any event, any costs Ms J then incurred could be said to be offset by Mr J’s decision not to pursue costs against her when he succeeded in the Family Court.
[26] Mr J’s decision to send $250,000 to the United States, the decision Allan J found high handed, did not impinge on or complicate the appeal. It is a relationship property issue. So too Mr J’s failure to contribute child support is a distinct issue as to which Ms J may have separate recourse. Neither is a ground for an award of costs on this present appeal.
[27] Thirdly, the points at which Ms J contends that Mr J was unduly adversarial on the appeal do not seem to me so significant as to justify an award of costs for that reason alone. It is telling that neither Duffy J in her preliminary decision, nor Allan J in his substantive decision, criticised Mr J for being unduly adversarial in those or any ways which were significant.
[28] Fourthly, Mr J, like Ms J, has incurred very substantial fees to pursue this appeal and on his affidavit, as on hers, is modestly placed. Ms J may contend that Mr J has understated his means, just as he contends that she has understated hers. But on such evidence as there is I do not consider that he has been any better placed than she has been to meet their very significant legal costs on the appeal, let alone to meet an award of costs in her favour.
[29] For these reasons I conclude that in this case an award of costs against Mr J
would be inconsistent with the welfare and best interests of the children for the
reasons endorsed in the cases. I decline Ms J’s application.
P.J. Keane J
3