Shaw & Muller [2009] FamCAFC 118; (5 May 2009)

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Shaw & Muller [2009] FamCAFC 118 (5 May 2009)

Last Updated: 15 July 2009

FAMILY COURT OF AUSTRALIA

SHAW & MULLER

[ 2009] FamCAFC 118

FAMILY LAW - APPEAL – SECURITY FOR COSTS – where the mother is appealing against parenting orders – where the father filed an application seeking security for his costs of the appeal – found that the circumstances did not justify an order for security for costs – emphasised that in similar cases time and resources spent in arguing and opposing applications for security for costs may be better spent in determining the appeal itself – application dismissed.

Family Law Act 1975 (Cth) s 117 Adult Guardian and Mother’s Parents and B and Child’s Representative [2002] FamCA 874; (2002) FLC 93-116 Halsbury & Halsbury [2008] FamCAFC 170 Jones & Jones [2001] FamCA 460; (2001) FLC 93-080 Rodgers & Pisani [2007] FamCA 1510 Sawer & Sawer [2007] FamCA 140

APPLICANT:

MR SHAW

RESPONDENT:

MS MULLER

FILE NUMBER:

ADC

3461

of

2007

APPEAL NUMBER:

SA

91

of

2008

DATE DELIVERED:

5 May 2009

PLACE DELIVERED:

Adelaide

JUDGMENT OF:

Finn, Coleman and Strickland JJ

HEARING DATE:

5 May 2009

LOWER COURT JURISDICTION:

Federal Magistrates Court of Australia

LOWER COURT JUDGMENT DATE:

14 October 2008

LOWER COURT MNC:

[2008] FMCAfam 1115

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Forth

SOLICITOR FOR THE APPLICANT:

Mark Forth & Associates

COUNSEL FOR THE RESPONDENT:

Mr McQuade

SOLICITOR FOR THE RESPONDENT:

Hume Taylor & Co

ORDERS

(1) The application by the father for security for costs in relation to the mother’s appeal against orders of Federal Magistrate Lindsay made on 14 October 2008 be dismissed.
(2) The costs of and incidental to the application for security are reserved as costs in the appeal.

IT IS NOTED that publication of this judgment under the pseudonym Shaw & Muller is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT ADELAIDE

Appeal Number: SA 91 of 2008
File Number: ADC 3461 of 2007

Mr Shaw

Applicant

And

Ms Muller

Respondent

REASONS FOR JUDGMENT

FINN J:

1. This is an application made on behalf of Mr Shaw, to whom it will be convenient to refer as “the father”, for an order that Ms Muller, “the mother”, lodge security for the costs which the father will incur as the respondent to an appeal which the mother has filed against parenting orders made by Lindsay FM on 14 October 2008. Those parenting orders essentially provided that the child of the parties' relationship, aged about four at the time - now five - and who had predominantly lived with the mother until the Federal Magistrate's orders, should, for the future, live with the father and spend defined time with the mother. The mother opposes the application for security and seeks its dismissal.
2. The power in this court to order security, as was recognised by Mr Forth appearing for the father today, is to be found in s 117(2) of the Family Law Act 1975 (Cth) (“the Act”):

117(2) If, in proceedings under this Act, the court is of opinion that there are circumstances that justify it in doing so, the court may, subject to subsections (2A), (4) and (5) and the applicable Rules of Court, make such order as to costs and security for costs, whether by way of interlocutory order or otherwise, as the court considers just.

3. It is important to bear in mind, however, that subsection (1) of section 117 contains the primary rule regarding costs in this jurisdiction, being that each party should pay his or her own costs in proceedings under the Act. But, in determining whether there are circumstances which justify an order for security, the court must have regard to the matters in section 117(2A), which are as follows:

(a) the financial circumstances of each of the parties to the proceedings;

(b) whether any party to the proceedings is in receipt of assistance by way of legal aid and, if so, the terms of the grant of that assistance to that party;

(c) the conduct of the parties to the proceedings in relation to the proceedings including, without limiting the generality of the foregoing, the conduct of the parties in relation to pleadings, particulars, discovery, inspection, directions to answer questions, admissions of facts, production of documents and similar matters;

(d) whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court;

(e) whether any party to the proceedings has been wholly unsuccessful in the proceedings;

(f) whether either party to the proceedings has made an offer in writing to the other party to the proceedings to settle the proceedings and the terms of any such offer; and

(g) such other matters as the court considers relevant.

4. The relevant authorities (Jones & Jones [2001] FamCA 460; (2001) FLC 93-080; Adult Guardian and Mother’s Parents and B and Child’s Representative [2002] FamCA 874; (2002) FLC 93-116; Rodgers & Pisani [2007] FamCA 1510; Halsbury & Halsbury [2008] FamCAFC 170; Sawer & Sawer [2007] FamCA 140) establish that the following matters may also be considered in determining an application for security for the costs of an appeal: the prospects of success of the appeal; whether the claim for security is made bona fide; whether an order for security would stifle the litigation; whether the litigation involves a matter of public importance; whether there has been delay in bringing the application for security; and the difficulty in enforcing an order for costs, if one was in fact to be made.
5. In support of the father's application for security, reliance has been placed in particular on two of the matters to which regard should be had in determining such an application and to which I have just referred.
6. The first matter on which the father relies, is the parties' respective financial circumstances, being both the position of the father who earns about $40,000 a year and runs his own small business, and that of the mother, with it being claimed that she is virtually impecunious. In relation to the parties' financial circumstances, the father has sought to rely on some events in the criminal law jurisdiction, which may expose the mother in due course, to a compensation claim.
7. The next matter relied on by the father is the merits of the appeal. In this regard Mr Forth for the father has relied on the principles which establish the limited grounds for appellate interference with a discretionary judgment, and also the prima facie presumption of the correctness of such a judgment.
8. Turning then to consider these two matters relied on by the father, it cannot, in my view, be said that the mother is impecunious. She is in receipt of an income, and the figures which we were told about by her counsel would amount, in round terms and in this financial year, to her having earnt about $19,000. It cannot be said, therefore, that she is impecunious.
9. As to the merits of the appeal, although the grounds as contained in the mother's notice of appeal are far from illuminating, discussion here this morning with the mother's counsel has revealed that her case would primarily be that there was - and in the old language - a longstanding “status quo” whereby the child had lived with her. There was then a change, being that the child was to live with the father.
10. In such circumstances, the mother would submit, there was a particular duty on the trial court to consider the effect on the child of such a change, as is required by s 60CC(3)(d) of the Act. It would then be part of the mother's case that his Honour should have endeavoured to ensure that he had adequate evidence before him to satisfy himself concerning the child's welfare if such a change were made.
11. It is not for us here today to determine whether or not those arguments would succeed on appeal. Certainly, though, for my part, I do not consider that the case is demonstrably hopeless. That is not to say that the appeal will succeed, but I do not think it can be said that it is doomed to fail.
12. I also think there may be some substance in the submission made by Mr McQuade for the mother, being that there may be a point of public interest in the issue of whether there is an obligation on a court to satisfy itself that it has the necessary expert evidence before it in parenting proceedings.
13. For these reasons, I am not persuaded that this is an appropriate case for the award of security for the father's costs.
14. I want to take the opportunity, however, to make a couple of observations regarding such applications for security. Increasingly, the time of the appellate jurisdiction of this court, be it exercised by a Full Court or by a single Judge, is being taken up with applications for security for the costs of an appeal. Such applications take the time of the court - a couple of hours have already been spent here this morning - and there was preparation time on the part of members of the bench.
15. Probably more importantly, though, such applications absorb the costs of the parties, and one has to wonder why money is spent sending the legal representatives along to argue such security applications in relation to an appeal arising out of what was not particularly complex litigation below. The time today could well have been spent in simply arguing the appeal, but that has to now be put off to another day.
16. This is particularly unfortunate in this case, where the mother has managed to put together and file the appeal books. That is not an inexpensive exercise, but she has done it. Her counsel has already prepared a summary of argument. I am not sure how prepared the father's side are, but the mother is ready to proceed with the hearing of her appeal.
17. I stress again that the appeal could have been heard today. It is unfortunate that that could not happen. Such delays seem to be happening in a number of cases. It is therefore a useful opportunity to remind the legal profession to think carefully before bringing such an application for security in a relatively simple and standard case - I do not, of course, downplay the issues in this case; of course they are important.
18. The other point which needs to be emphasised - and I endeavoured to do so at the outset of these reasons - is that the primary rule regarding costs in this jurisdiction, is that each party pays his or her own costs. True it is that costs orders are not uncommon in the appellate jurisdiction. But it is my impression from hearing many of these applications for security that those making them seem often to base their case on an assumption that there will be an order for costs at the end of the appeal. That cannot be assumed, particularly, dare I say it, in a case involving children.
19. Thus I take this opportunity to make these points, which I consider need to be considered by those who advise litigants in this jurisdiction regarding applications for security for costs in an appeal.
20. The order which I would propose to make is that the application by the father for security for costs in relation to the mother's appeal be dismissed.

COLEMAN J:

21. I too would dismiss the application and would do so for the reasons that Finn J has provided. I would endorse her Honour's observations as to the unfortunate practical effects of security for costs applications in cases such as this. I otherwise have nothing to add.

STRICKLAND J:

22. I agree with the reasons for judgment delivered by the presiding judge and the proposed order, and I have nothing to add.

FINN J:

23. We propose to reserve the costs as costs in the appeal.
    

I certify that the preceding twenty-three (23) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court

Associate:

Date: 10 July 2009