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FLAST CASE SUMMARY: Lepanto & Lepanto [2019] COSTS

Lepanto & Lepanto [2019] FamCA 62 (14 February 2019)

The wife’s application for costs develops from final property proceedings that continued to an undefended hearing due to the husband’s failure to engage in the proceedings.

The husband appears to have chosen to disengage from the proceedings without reason. This has caused the wife to organise for a final hearing in circumstances where the Court had formerly been told by both parties the matter had been close to resolved by agreement. In the period from February 2018 to undefended hearing the wife incurred legal fees in the sum of $41,533.00.

 

FACTS SUMMARY:

  • 4 October 2018, final orders were made for property on an undefended basisLepanto & Lepanto[2018] FamCA 791.
  • The husband fails to engage in proceedings, the circumstances surrounding this are detailed at[4] to [11].
  • This had caused the wife to prepare for a final hearing in circumstances where the Court had previously been told by both parties the matter was close to resolve by agreement.
  • It was necessary for the wife to proceed to undefended hearing.
  • 4 October 2018, the husband appeared before the Court in person for the making of orders and delivery of reasons for judgment.
  • An order was made as to any cost’s submissions. In accordance with order, the wife provided her written submissions as to costs.
  • In the period from February 2018 to undefended hearing the wife incurred legal fees in the sum of $41,533.00.
  • No submissions have been received from the husband.
  • The financial circumstances of the wife are known from the orders made on 4 October 2018.
  • The husband’s financial circumstances are unknown, with the exception that he has a significant expectancy regarding the estate of his mother who died in August 2017, additionally, he receives rent from the former matrimonial of $1,500 per week.

ISSUE:

Do the circumstances justify a departure from the general rule that each party pay their own costs?

HELD:

Order that the husband pay to the wife the sum of $30,000.00 for her costs within one month.

In determining this matter the court looked to Section 117 of the Family Law Act 1975  which specifies that each party to the proceedings shall bear his or her own costs.Subsection (2A) outlines the issues applicable to determining what order, if any, should be made for costs.

However, the judge has discretion of the weight given to the consideration under s 117(2A) to make an order for costs on an indemnity basis to repay the other party entirely or partially their legal costs and expenses and charges acquired in the proceedings.Nonetheless, in I and I (No 2) (1995) FLC 92-625 it was held that the applicable matters in s 117(2A) “must all be taken into account and all balanced in order to determine whether the overall circumstances justify the making of an order for costs”. 

The undefended hearing was required due to husband not complying with previous orders as to filing of documents, his duty as to full and frank disclosure, and not attending numerous procedural directions. It was necessary for the wife to proceed to the undefended hearing.

The Judge determined that the circumstances in this case warrant a departure from the general rule that each party pay their own costs.

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