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Costs – indemnity costs against solicitor – client’s application had no chance of success

In Benard & Eames and Anor [2020] FamCAFC 47 (5 March 2020) the Full Court (Alstergren CJ, Strickland & Kent JJ) dismissed with costs of $18,000 an appeal by a solicitor ordered to pay indemnity costs. The solicitor acted for the father in an application for a credit of third-party payments made for the parties’ children under s123 of the Child Support (Assessment) Act 1989 and an order under s66M of the Family Law Act 1975 that he had a lawful duty to maintain his stepchildren (the children of his new partner).

At first instance Judge Bender summarily dismissed the application for having no reasonable chance of being granted. The father’s appeal of that dismissal was dismissed. Costs were subsequently awarded to the mother and the father’s solicitor was ordered to pay them. He appealed.

The Full Court said (from [35]):

“…[I]t is clear that the application was brought on the advice of the appellant… where [he] would have well known that the application had no chance of success. Indeed, that was not only a finding by her Honour, but was also a finding by the Full Court…[which] also found that the application was brought for a collateral purpose and was, thus, an abuse of process.

[36] (…) As was said by the Full Court of the Federal Court of Australia in Levick v Deputy Commissioner of Taxation [2000] FCA 674 at [44]:

‘…[I]t is…important to uphold the right of a court to order a solicitor to pay costs wasted by the solicitor’s unreasonable conduct of a case. What constitutes unreasonable conduct must depend upon the circumstances of a case…In the context of instituting or maintaining a proceeding…we agree with Goldberg J that unreasonable conduct must be more than acting [for] a client who has little or no prospect of success. There must be something akin to abuse of process…using the proceeding for an ulterior purpose or without any, or any proper, consideration of the prospects of success.’”

Robert Glade-Wright is the founder and senior editor of The Family Law Book, a one-volume loose-leaf and online family law service (thefamilylawbook.com.au). He is assisted by Queensland lawyer Craig Nicol, who is a QLS Accredited Specialist (family law).

This story was originally published in Proctor May 2020.

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