J W W v S J B
| Jurisdiction | New Zealand |
| Judge | N A WALSH |
| Judgment Date | 19 March 2010 |
| Court | Family Court |
| Docket Number | FAM-2008-009-000707 |
| Date | 19 March 2010 |
IN THE FAMILY COURT AT CHRISTCHURCH
FAM-2008-009-000707
Ms Burnhill for the Applicant
Ms Harrison for the Respondent
On 3 September 2009 I issued a decision regarding an application made by Ms W for a departure order under s 104 of the Child Support Act 1991.
Mr B and Ms W married in 1995 and have two children, W and H. The parties separated in 1998 but Ms W and the children remained living on Mr B's family farm, financially supported by Mr B, for the first eight months of the separation. After that point Ms W went on the Domestic Purposes Benefit.
In 2005 Ms W and the children relocated from Ashburton to Christchurch. Over the last four years the parties have had limited communication and no verbal dialogue.
On 1 April 1998 Ms W applied for a child support formula assessment and it is from this date that Mr B has paid child support. On 22 June 2007 Ms W sought to have the amount of child support increased on the basis that the boys' father had a higher earning capacity than that assessed as his taxable income. A Child Support Review Officer undertook a review in July 2007 but declined to determine the departure application, finding that the Family Court would be better equipped to deal with the complex issues the review raised.
On 20 February 2008 Ms W filed an application in the Family Court for the amount of child support to be assessed. I found there to be “special circumstances” under s 105 of the Child Support Act justifying a departure from the formula assessment and fixed the income of Mr B to be $70,000 for the period of 1 March 2006 to 31 March 2010.
The 3 September 2009 judgment reserved leave to file submissions regarding costs. Counsel for Ms W filed a memorandum on 21 September 2009 requesting that an award of costs be made to the applicant on a 2B basis. On 6 November 2009, counsel for Mr B filed a memorandum in reply.
Counsel for the Respondent has stated in submissions that s 232 of the Child Support Act gives the Court a discretion to make an order for costs, but that the discretion must be guided by the District Courts Rules 1992, specifically rules 45 – 47. However, further on in the submissions counsel refers to the approach endorsed by Judge O'Dwyer in NPC v CIR (FC Dunedin, FAM-2006-012-544, 30 April 2007), which is not entirely consistent with the principles contained in rule 46 of the District Courts Rules 1992. At para [9] Her Honour said:
- From the cases I discern the following principles and relevant factors to cost decisions under the Child Support Act. (a) The approach to costs in Child Support Act cases is not identical to general or civil proceedings. While the structure as to costs under the rules is a guide it is necessary to consider a number of other factors. (b) As a general principle, rule 45 – 47 [of] the District Court Rules applied to factors relevant to Child Support. (c) The following factors should be considered: (i) The object of the Child Support Act (ii) The outcome of the proceedings (iii) Material issues and complexity (iv) Conduct of the proceedings, in particular whether they have become protracted by the actions of any party. (v) Means of the parties (vi) Actual costs incurred (vii) Overall interest of justice.
It is this approach which counsel has then followed.
I agree with counsel that s 232 gives the Court a discretion to award costs, but in my opinion this discretion is not fettered by the District Courts Rules.
Section 232 provides:
232 Costs
In any proceeding under this Act the Court may make such order as to costs as it thinks fit but all costs awarded against the Commissioner shall be payable out of public money appropriated by Parliament and not otherwise.
As identified in the Respondent's submissions, the transitional provisions of the District Courts Rules 2009 provide that proceedings commenced before and pending, or in progress, on the 1st of November 2009 are to be continued and completed under the 1992 District Courts Rules. Therefore, the costs provisions under the 1992 Rules apply in this case.
Rule 207 of the Family Courts Rules 2002, prior to amendment when the District Courts Rules 2009 came into force on 1 November 2009, provides that rule 45 of the District Courts Rules 1992 applies, so far as applicable and with all necessary modifications, to Family Court proceedings.
As of 2 February 2005, rule 45 has read:
45 Costs at discretion of Court
(1) All matters relating to the costs of and incidental to a proceeding or a step in a proceeding are at the discretion of the Court.
(2) Rules 46 to 47G apply subject to subclause (1).
(3) This rule is subject to the provisions of any Act.
Rule 46 states:
46 Principles applying to determination of costs
The following general principles apply to the determination of costs:
(a) the party who fails with respect to a proceeding or an interlocutory application should pay costs to the party who succeeds:
(b) an award of costs should reflect the complexity and significance of the proceeding:
(c) costs should be assessed by applying the appropriate daily recovery rate to the time considered reasonable for each step reasonably required in relation to the proceeding or interlocutory application:
(d) an appropriate daily recovery rate should normally be two-thirds of the daily rate considered reasonable in relation to the proceeding or interlocutory application:
(e) what is an appropriate daily recovery rate and what is a reasonable time should not depend on the skill or experience of the actual solicitor or counsel involved or on the time actually spent by the actual solicitor or counsel involved or on the cost actually incurred by the party claiming costs:
(f) an award of costs should not exceed the costs incurred by the party claiming costs:
(g) so far as possible the determination of costs should be predictable and expeditious.
Rule 47 provides for categorisation of proceedings:
47 Categorisation of proceedings
(1) For the purposes of rule 46(b), proceedings must be classified as falling within 1 of the following categories:
Category 1 proceedings Proceedings of a straightforward nature able to be conducted by counsel considered junior.
Category 2 proceedings Proceedings of average complexity requiring counsel of skill and experience considered average.
Category 3 proceedings Proceedings that because of their complexity or significance require counsel to have special skill and experience.
(2) The Court may at any time determine in advance an applicable category in relation to a proceeding. If it does, the category applies to all subsequent determinations of costs in the proceeding unless there are special reasons to the contrary.
(3) Each step specified in term 10 of Schedule 2A must be treated as having been taken in a category 2 proceeding.
(4) Unless the Court otherwise directs, subclause (3) applies to a proceeding even if the Court has, under subclause (2), determined the category of the proceeding.
In Evans v Evans (2004) 23 FRNZ 961 Judge Ellis, referring to s 232 of the Child Support Act 1991 said at para [6], “It is clear that the Court has an unfettered discretion which must be exercised judicially and informed by the principles and objects of the particular statute.” At paras [7] – [8] the Judge stated that the more traditional approach taken in Family Court costs cases of leaving each party to pay their own costs was being shunned in favour of a trend where costs follow the event.
In G v G (FC Christchurch, FAM-2001-009-000538, 1 September 2003) Judge Somerville was clearly of the view that the Family Court should follow normal civil proceedings with costs following the event.
The trend toward the Family Court adopting a more civilly based approach to costs was also discussed in L v W [2003] NZFLR 961. This was an appeal from the Family Court at Rotorua which raised issues of jurisdiction and exercise of discretion in relation to costs in proceedings under the Domestic Violence Act 1996.
Heath J was of the opinion that discretion to award costs cannot be based on identical discretionary principles in all Courts. His Honour observed that in recent cases the Family Court has relied on a more traditional approach to the awarding of costs, but that “a discretion as to costs must always be informed by the objects of the Act, or subordinate legislation, which applies to the substantive proceeding” (para [27]). At para [29] His Honour endorsed the approach taken by Judge Mather in A v A [1999] NZFLR 447 at 452 that “questions of costs should be by reference to the objects and purposes of the legislation under consideration in the particular case.”
Judge Callinicos 1 followed the method considered by Heath J in R v S (HC Auckland, CIV-2002-402-65, 2 August 2003) at paras [59]–[65] to be the current correct judicial approach to the exercise of the discretion on costs and therefore acknowledged at para [20] that it will be common in family proceedings for the Court to take an approach to costs “that is less clinical or “result focussed” than a case that is purely civil.”
The approach was summarised...
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