Proceedings in the Federal Circuit Court and Family Court of Australia, whether for financial matters or parenting rights, is often an incredibly stressful and nerve-wracking experience for everyone involved. Add the financial burden on top of that and it is not uncommon for many to start feeling incredibly overwhelmed. In order to avoid the shock of being handed an unexpected bill, it is important that parties do their due diligence when it comes to the costs involved with family law. Today, we have a look at a brief guide to costs orders in Family Law proceedings.
Every Man (or Woman) For Themselves
First and foremost, one of the most important things to know is that in Family Law proceedings each party will normally be expected to bear his or her own legal costs. This is the starting point for all applications that come before the Court and is a stark difference when compared to other types of law proceedings where costs orders are commonly made in favour of the successful party. As a rule of thumb, each party is responsible for their own legal costs should they choose to receive legal advice or counsel to represent them. However, as with most things in life, there are some exceptions to this rule.
When Might The Courts Make A Costs Order?
Under Section 117(2) of the Family Law Act, the court may make a costs order as it considers just. Orders for costs can be made at any stage of the family law proceedings, including during interim applications where Court Orders are made before matters are officially finalised.
Some of the things the courts will consider include:
Where one party breaches a Court order that subsequently requires the other party to file an Application to the Court due to the breach;
Where one party fails to comply with standard Court procedures. Some examples include failing to provide disclosure of financial circumstances which then requires the other party to file an Application to the Court.
If a party has been wholly unsuccessful in their Application before the Court.
Where a written offer of settlement was by one party but rejected by the other party and following determination by the Court, the person who made the offer is awarded an amount equal to or greater than the offer.
Such other matters as the Court considers relevant.
Important: Do note that there is no requirement for there to be more than one of the above factors to be present for an order for costs to be made.
The last thing to consider is indemnity costs. This comes into play as a direct result of the conduct of the other party, such as where a party's conduct has been unreasonable or uncooperative. In such a situation, the Court can award the payment of all costs to the other party in what is known as “indemnity costs”.
Some examples of where indemnity costs may be awarded include:
When a party makes false or irrelevant allegations against the other.
Where evidence exists of misconduct that causes loss of time to the Court and the parties.
When a party unduly prolongs a case with groundless allegations.
When a party unreasonably refuses an offer to settle.
If you have any questions or require advice about your family law matter, do not hesitate to call us at (03) 9670 7577 or send us an email at email@example.com. One of our experienced family lawyers will be in touch as soon as possible in order to assist you with your query.