Withers & Russell (No 2) [2022] – Court Orders Costs Due to Non-Participation in Proceedings

ALDRIDGE, TREE & WILSON JJ:

1. On 21 November 2022 we dismissed an Application in an Appeal filed by Ms Russell (“the mother”) and ordered that she pay the costs of Mr Withers (“the father”) in the sum of $8,652.18 within 28 days, however reserved our reasons for doing so. These are those reasons.
2. To understand why we made those orders, it is utile to briefly set out some background.
3. The mother was at all relevant times an Australian legal professional, who is currently living in the United States of America.
4. On 26 May 2022 the primary judge ordered that the mother have sole parental responsibility for the parties’ children and permitted her to relocate them to the United States of America. On 23 June 2022 the father filed a Notice of Appeal (Appeal No. NAA 139 of 2022) against those orders.
5. On 11 July 2022 the primary judge refused to stay those orders. On 13 July 2022 the father sought leave to appeal (Appeal No. NAA 154 of 2022) against that refusal.
6. By Notices of Discontinuance each dated 19 July 2022, the father discontinued both appeals.
7. Pursuant to r 13.42 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth), on 16 August 2022 the mother (who was self-represented) filed an Application in an Appeal in which she sought that, within 28 days, the father pay her costs for both appeals on an indemnity basis, fixed in the sum of $57,000.
8. On 29 August 2022 an appeal judicial registrar made orders requiring the mother to file her written submissions and list of authorities in support of her costs application by 17 October 2022. She did not comply with that order. The father filed written submissions on 3 November 2022, within the time ordered by the appeal judicial registrar.
9. The mother did not appear before us on 21 November 2022, although the father was represented. His counsel informed us that all documents ordered to be served on the mother had been so served, but she had not communicated with the Court or the father’s solicitors, nor filed any documentation in accordance with the orders previously made by the appeal judicial registrar.
10. We then dismissed the mother’s costs application pursuant to s 32(3)(e) of the Federal Circuit and Family Court of Australia Act 2021 (Cth) (want of prosecution) as well as s 32(3)(f)(ii) of the same Act (failure of the mother to attend a hearing relating to the appeal). That was because the mother was in clear breach of the relevant procedural orders, and had wholly disengaged from the proceeding, including failing to appear before us. In any event, why indemnity costs should be ordered, or how the mother could possibly have incurred $57,000 in costs between 23 June and 19 July 2022, was entirely unclear.
11. The father then made an application for indemnity costs consequent upon the dismissal of the mother’s costs application. Counsel called in aid the well-known authority of Colgate Palmolive Co v Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225 in contending that in the circumstances of this case an indemnity costs order should be made against the mother.
12. In costs applications under the Family Law Act 1975 (Cth) (“the Act”), the provisions of s 117(1) establishes that ordinarily each party should bear his or her own costs of proceedings. However s 117(2) of the Act permits a costs order so long as one of the circumstances set out in s 117(2A) is engaged (Fitzgerald v Fish [2005] FamCA 158; (2005) 33 Fam LR 123), but even so, a costs order may only be legitimately made if it is just in all circumstances (Hogan and Hogan [1986] FamCA 34; (1986) FLC 91-704).
13. Various Full Courts of this Court have repeatedly stated that an order for indemnity costs should only be made in exceptional circumstances (for example Medlon & Medlon (No 6) (Indemnity Costs) [2015] FamCAFC 157; (2015) FLC 93-664 and Limousin v Limousin (Costs) [2007] FamCA 1178; (2007) 38 Fam LR 478). In Hatcher v Cohn [2004] FCA 1548; (2004) 139 FCR 425, Kiefel J (as her Honour then was) held that exceptional circumstances are those out of the ordinary. Thus in Moy & Pao [2022] FedCFamC1A 17; (2022) FLC 94-073, it was held that blatant disregard of trial directions is clear misconduct justifying the imposition of an order for indemnity costs. However the facts of that case were more noxious than are the facts here, and in our view, an order for the mother to pay the father’s indemnity costs is not warranted, nor, for that matter, would such an order be just.
14. However an order for the mother to pay the husband’s party/party costs is appropriate. We say that because –
    

    (a) the mother is a legal professional, who is taken to be well aware of her obligations as a litigant in this Court;(b) she was required by orders made by the appeal judicial registrar to have filed documents in her application for costs by 17 October 2022;

    (c) she filed no documents, despite being aware of her obligation to do so, nor did she show basic professional courtesy to the Court or to her opponents by indicating that she did not propose to file documentation as previously ordered, or appear at the hearing;

    (d) the father was entitled to prepare for this matter in the way he did, seeking the dismissal of the mother’s costs application, right up to the day of the hearing of the appeal; and

    (e) had the mother notified the father’s legal practitioners and the Court by a date prior to 21 November 2022 that she was not prosecuting her application for costs, then the costs of 21 November 2022 may not have been incurred.

15. In our view, those matters amply justified a costs order being made against the mother.
16. The quantum of costs ordered was as sought by the father in his schedule of costs filed on 14 November 2022. All items claimed are properly party/party costs.