Husband Challenges Assessment of Costs
Carron & Laniga [2022] FedCFamC1A 116 (26 July 2022)
The husband appeals from an order dismissing his application to have a costs assessment order set aside. The Court, in determining whether the primary judge erred, considered the husband's application to set aside the assessment orders.
Facts:
Property settlement orders under Pt VIII of the Family Law Act 1975 (Cth) (“the Act”) were first made between the parties in September 2018, but the orders were set aside on appeal in July 2019 and the dispute was remitted for re-hearing. While that appeal was still pending, another order was made on 4 December 2018 requiring the husband to pay the wife’s costs of and incidental to the proceedings (“the costs order”).
Fresh property settlement orders were made in March 2020 following the re-hearing. On 22 October 2020, after the substantive proceedings were complete, the primary judge ordered the parties to bear their own costs of and incidental to the re-hearing, but confirmed the costs order remained operative.
On 22 February 2022, the registrar assessed the costs in the sum of $87,287.24 and ordered payment within 28 days (“the assessment orders”). The assessment orders stimulated a flurry of activity, being: (a) an Application for Review filed by the wife on 1 March 2022 (“the first application”) – the purpose of which was to review the assessment orders; (b) an Application in a Proceeding filed by the husband on 3 March 2022, but amended on 12 April 2022 (“the second application”) – the purpose of which was to, in part, stay the assessment orders; (c) another Application in a Proceeding filed by the husband on 7 March 2022 (“the third application”) – the purpose of which was to set aside the assessment orders; and (d) a Response to the Application in a Proceeding filed by the wife on 5 April 2022 (“the fourth application”) – the purpose of which was, in part, to vary the assessment orders.
The first application was dismissed by Judge Murdoch on 4 March 2022, from which dismissal order there was no appeal by the wife. The other three applications were all heard and dismissed by the primary judge on 13 April 2022. The husband appealed from the dismissal order, but has since amended the grounds of the appeal and now prosecutes those set out in the Amended Notice of Appeal filed on 1 July 2022.
Given the wife did not cross-appeal, her contentment to abide by the decision to dismiss the fourth application should be presumed, thereby leaving for consideration in this appeal only the dismissal of the second and third applications brought by the husband.
In the second application (as amended), the husband sought: the stay of the assessment orders (Order 1); an order for the wife to remove a caveat registered over a parcel of real property (Order 2); and an order confirming that his payment of costs only be required within 28 days of the stay being lifted or the removal of the caveat (Order 3).
Ground 1 in the appeal attacks the dismissal of the second application, contending the primary judge’s discretion was miscarried. In the third application, the husband sought that the assessment orders be set aside. Ground 2 in the appeal attacks the dismissal of the third application, contending the primary judge erred by failing to follow the process set out in Div 12.8.2 of the Rules.
Ground 3 is a more general complaint about the primary judge’s erroneous understanding of the two applications and their “relationship...to previous decisions of the Court”. Ground 4 asserts bias by the primary judge.
Issue:
Whether or not the primary judge erred.
Applicable law:
Analysis:
Her Honour seemingly mistook the husband’s challenge to the assessment orders to instead be a challenge to the order made by Judge Murdoch dismissing the first application. The husband did not seek to disturb the order made by Judge Murdoch dismissing the wife’s application.
The husband brought an application under r 12.51 of the Rules to set aside the assessment orders, though it was filed in the form of an Application in a Proceeding rather than in the form of an Application for Review as required (r 12.52(1)). Such a technical error should not preclude the application from being entertained.
The husband was entitled to resort to the use of r 12.51 and, while such reliance may not then have accorded with the primary judge’s “understanding of the legislation”, upon reflection, her Honour accepted the probity of the third application. The husband’s application under that rule was filed within 14 days of the assessment orders, as was required.
While the substantive property settlement proceeding under Pt VIII of the Act was complete, the parties were still contesting the quantum of the husband’s liability for costs in that cause. Her Honour was obliged to hear and determine the husband’s application to set aside the assessment orders on merit. It was a material error of law not to do so, meaning the appeal must succeed.
Conclusion:
The appeal is allowed in part. The order made by the primary judge on 13 April 2022 is varied so as to exclude from its operation the Application in a Proceeding filed on 7 March 2022.
The orders made by the primary judge on 20 July 2022 are set aside. The Application in a Proceeding filed on 7 March 2022 is remitted for re-hearing by a judge of the Federal Circuit and Family Court of Australia (Division 2), other than the primary judge. Pending the determination of the Application in a Proceeding filed on 7 March 2022, Orders 2 and 3 made by the Judicial Registrar on 22 February 2022 are stayed.
