New South Wales Supreme Court CITATION : Moussa v Moussa - Costs [2006] NSWSC 509 This decision has been amended. Please see the end of the judgment for a list of the amendments. HEARING DATE(S) : 24/04/06 JUDGMENT DATE : 29 May 2006 JURISDICTION : Equity Division JUDGMENT OF : Barrett J DECISION : No order as to costs CATCHWORDS : PROCEDURE - costs - Family Provision Act claim - where plaintiff's claim had merit but failed because of greater need for claims of widow and young child to be met out of estate consisting of matrimonial home only - no order as to costs Civil Procedure Act 2005, s.98 LEGISLATION CITED : Family Provision Act 1982, s.33 Uniform Civil Procedure Rules 2005, rule 42.1 Bearns v Bearns-Hayes (unreported, NSWSC, Young J, 6 May 1997) Coombes v Ward (No 2) [2002] VSC 84 CASES CITED : Jvancich v Kennedy (No 2) [2004] NSWCA 397 Re Sherborne Estate (No 2); Vanvalen v Neaves [2005] NSWSC 1003 Singer v Berghouse (1993) 114 ALR 521 PARTIES : Therese Mary Moussa and Samuel Latif Moussa by their next friend Anita Devi Gounder - Plaintiffs Deborah Veronica Moussa - Defendant FILE NUMBER(S) : SC 5147/04 COUNSEL : Mr J.R. Wilson SC - Plaintiffs Mr L.J. Ellison SC - Defendant SOLICITORS : The Hargreaves Practice - Plaintiffs MacLarens - Defendants IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION BARRETT J MONDAY, 29 MAY 2006 5147/04 THERESE MARY MOUSSA AND SAMUEL LATIF MOUSSA BY THEIR NEXT FRIEND ANITA DEVI GOUNDER v DEBORAH VERONICA MOUSSA JUDGMENT ON COSTS 1 I am dealing with the question of costs in consequence of dismissal of the plaintiffs' claims under the Family Provision Act 1982: see Moussa v Moussa [2006] NSWSC 352. The plaintiffs were the teenaged children of the deceased by his first wife who was their tutor for the purposes of the proceedings. 2 The successful defendant (the widow of the deceased and the administratrix of his intestate estate) says that the court should order the unsuccessful plaintiffs to pay her costs – recognising that the burden of any such costs order will fall upon the tutor (their mother): see the commentary at paragraph 7.15.30 of Ritchie's "Uniform Civil Procedure NSW". The plaintiffs say that there should be no order as to costs, so that each side bears its own costs. 3 It is noted in submissions that the question of costs in this case is governed by not only s.98 of the Civil Procedure Act 2005 but also s.33 of the Family Provision Act. There is comment about the interaction between the two (or, more precisely, between the Family Provision Act provision and the relevant provision of the Supreme Court Act as then in force) in Bearns v Bearns-Hayes (unreported, NSWSC, Young J, 6 May 1997): "There is a tension between s.76 of the Supreme Court Act , which gives the Court a judicial discretion as to costs and s.33 of the Family Provision Act 1982, which partly deals with costs in that it makes limitations on orders against the estate. A very real question is whether the two can be read together or whether s.33 is intended to cover the field. Although it is unclear, it seems to me that the appropriate way of approaching the problem is that s.76 continues to apply, save as it is modified by s.33. Indeed, s.76(1) of the Supreme Court Act actually says it is operates 'subject to any other Act'." 4 Section 33 of the Family Provision Act regulates the extent to which the court may order that costs be paid out of the estate. In the present case, the application before me is an application for an order that costs be paid by the plaintiffs. I can therefore leave s.33 to one side. 5 On that basis, the ordinary rule reflected in rule 42.1 of the Uniform Civil Procedure Rules 2005 will apply and, in the absence of some good reason to the contrary, there should be an order that the costs of the successful defendants be paid by the unsuccessful plaintiffs. 6 It is to be remembered, however, that Family Provision Act cases are acknowledged to attract special considerations in relation to costs. I quote from the judgment of Gaudron J upon a security for costs application before the High Court in Singer v Berghouse (1993) 114 ALR 521 at pp.521-2: "In most cases, costs follow the event in the sense that, save in special or extraordinary circumstances, costs are awarded in favour of the successful party and against the unsuccessful one. It may well be that, in the absence of special circumstances and in a case where costs follow the event, the need to bring action in a foreign court to enforce an order for costs will weigh very heavily in favour of an order under O 70, r 7. Even so, decisions under O 70, r 7 involve a discretionary judgment of a very broad kind made by reference to the circumstances of the particular case and not by reference to a rule or rules which direct a decision one way or the other. Family provision cases stand apart from cases in which costs follow the event. Leaving aside cases under the Act which, in s 33, makes special provision in that regard, costs in family provision cases generally depend on the overall justice of the case. It is not uncommon, in the case of unsuccessful applications, for no order to be made as to costs, particularly if it would have a detrimental effect on the applicant's financial position. And there may even be circumstances in which it is appropriate for an unsuccessful party to have his or her costs paid out of the estate." 7 Gaudron J then referred to the circumstances that, at first instance, no order for costs was made against the applicant even though she had been unsuccessful. 8 In Jvancich v Kennedy (No 2) [2004] NSWCA 397, Giles JA observed (with Handley JA and McColl JA agreeing) that the "overall justice of the case" is "not remote from costs following the event" – thus indicating that the generally applicable rule is to be recognised. But proceedings of this kind involve elements of judgment and discretion beyond those at work in most inter partes litigation. As Palmer J said in Re Sherborne Estate (No 2); Vanvalen v Neaves [2005] NSWSC 1003: "A decision whether a Family Provision Act claim fails or succeeds produces a black and white result which often belies the fact that the case was borderline and could have gone either way." 9 That comment is apposite here. At paragraph [29] of the judgment, I said that it "may be doubted whether Therese and Samuel have been left without adequate provision". The possibility that they had been left without adequate provision was acknowledged. I went on to hold that, even if they had been left without adequate provision, I was not satisfied that any provision should be made for them out of the estate. This was basically because there was not enough to go around and that the predominating need was for the house (which was the only asset) to be preserved as a home for the widow and the very young child of the widow and the deceased, in company with the widow's other two children. In short, a need to keep a roof over the heads of the widow and the young child outweighed the need to make provision for the older children whose mother was able to provide for them to a reasonable standard. The borderline nature of the case emerges from paragraphs [30] and [31] of the judgment which I do not pause to reproduce here. 10 It was by no means unreasonable for the plaintiffs' legal advisers to believe that the claim had reasonable prospects of success. Its ultimate lack of success paid attention, in large measure, to the assets and resources available to their mother. In those circumstances, I view this case in the same way as Palmer J viewed the situation of the unsuccessful applicant in Sherborne and am of the opinion that "the overall justice of the case", to use Gaudron J's expression, warrants the conclusion that no order for costs should be made against the plaintiffs. 11 Costs should be left to lie where they have fallen. Each side will thus bear part of the financial burden of a case in which there was simply "not enough money to go around", to quote the words of Young CJ in Eq in Reddie v Cornock [2005] NSWSC 187 where the application was dismissed and there was no order as to costs (see also Coombes v Ward (No 2) [2002] VSC 84). 12 I make no order as to the costs of the proceedings, to the intent that each party will bear that party's own costs. ********** 29/05/2006 - Inadvertently hit "Restricted" - Paragraph(s) Instructions re publishing only DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.