Rk v. Ys

FCMP 151/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS

NO. 151 OF 2008

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Coram: Deputy District Judge S. Lo in Chambers (Not Open to Public)

Date of Hearing: 18 July 2012

Date of Respondent’s written submission: 6 July 2012

Date of Applicant’s written submission: 11 July 2012

Date of Respondent’s reply submission: 17 July 2012

Date of Judgment: 30 August 2012

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J U D G M E N T
(Variation of Costs Order Nisi)

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1.Upon dismissal of the 2 Summonses taken out by the Applicant (“the Father”) for variation of custody, I made an order nisi that there be no order as to costs. This is the application by the Respondent (“the Mother”) to vary this costs order nisi.

2.The starting point in all civil proceedings is that costs follow the event subject to the discretion of the court[1]. However, in family cases this general rule is more readily displaced and especially where children are concerned.  Generally in children’s cases it is usual for there to be no order as to costs. The Court retains a wide discretion to ensure that a party is not penalised simply for making an application in an attempt to show the Court what is in the best interests of the children.  Consequently the general practice of the Courts is not to order costs. The underlying rationale to the costs principle in children’s matters was explained in Sutton London Borough Council v Davis (No. 2)[2] where Wilson J states that:

“where a debate surrounds the future of a child, the proceedings are partly inquisitorial and the aspiration is that in their outcome the child is the winner and indeed the only winner. The court does not wish the spectre of an order for costs to discourage those with a proper interest in the child from participating in the debate. Nor does it wish to reduce the chance of their co-operation around the future life of the child by casting one as the successful party entitled to his costs and another as the unsuccessful party obliged to pay them.”

3.But the court retains its discretion to make a costs order against the unsuccessful party in appropriate cases. Wilson J continued to say in the case of Sutton Borough Council [3] as follows:

“…But the proposition is not applied where, for example, the conduct of a party has been reprehensible or the party’s stance has been beyond the band of what is reasonable (see Havering London BC v S [1986] 1 FLR 489 and Gojkovic (No 2)[1992] 1 All ER 267 at 271, [1992] Fam 40 at 60).” (emphasis added)

4.As to the kind of conduct that would justify a departure from the general rule, it has been suggested that the unreasonable conduct which might justify an order for costs was not unreasonableness in relation to the child concerned but unreasonableness in the conduct of the litigation. The Court of Appeal upheld the decision of Wilson J in R v R (Child) (Legal Aid: Costs)[4] stating that:

“….Although there was a general practice to not order costs in cases concerning children, courts retained a discretion to do so and in exceptional circumstances might be justified in ordering costs. It was unnecessary and undesirable to attempt to limit or place into rigid categories the cases in which courts might order costs, but amongst those cases would be those where a party had been guilty of unreasonable conduct. The unreasonable conduct which might justify an order for costs was not unreasonableness in relation to the child concerned but unreasonableness in the conduct of the litigation.”

5.If the applicant who goes beyond the limit of what is reasonable pursues a totally hopeless application, it may be regarded as unreasonable conduct that would justify a costs order against him.  In Re G (Costs: Child Case)[5], Butler-Sloss LJ had this to say:

“ If this judge in this case had found that this father had behaved unreasonably in the litigation and had gone beyond what many fathers do, seeking orders which are hopeless, the point will come at which pursuing a hopeless application becomes unreasonable. But hopelessness and unreasonableness are not necessarily the same thing. Indeed, particularly where there is a litigant in person, a degree of generosity towards a litigant may be more appropriate than to a litigant who is on legal aid generally advised by counsel and solicitors as to the extent to which they should continue to litigate.

…

It seems to me that the case of R v R does not change the normal situation that it is unusual to order costs, although it will be appropriate to order costs when a parent, even a litigant in person, goes beyond the limit of what is reasonable to pursue the application before the court.”

6.Therefore, the main issue now is whether the Father has behaved unreasonably in the conduct of his application for variation of the joint custody of the 2 children of the family that would justify a costs order against him.

7.Apart from unreasonable litigation conduct, the court may also take into account of the disparity in financial resources in the exercise of its discretion on the matter of costs.  As Wilson J said in Keller v Keller and Legal Aid Board[6]:

“…Equally a marked disparity in wealth, such that, for example, the wife’s costs would bear harshly upon her economy but could be discharged by the husband without significant impact upon his economy, might give rise to an order against him.”

8.The main submission of the Mother is that where a party unsuccessfully re-runs arguments which previously failed, he cannot complain if a costs order is made against him.  If it were otherwise, a party could make repeated applications about the same issues causing great expense to the other party in the knowledge he would be face no costs consequences.

9.On one hand, I accept that the Father did seek to re-run several arguments which are based on some of the previous evidence. On the other hand, I also accept that he further relied on the new evidence filed such as Dr. Levy’s new report and other incidences in support of his applications which occurred after the Court of Appeal Ruling. Although I do not agree with the opinion of Dr. Levy on alienation, I do not think that it is a good reason to penalize the Father in costs for relying on the opinion of an expert in the new report.  Furthermore, it is noteworthy that based on updated investigations and matters occurring after the Court of Appeal Ruling, the Social Welfare Officer prepared her new reports in which she recommended split custody of AK and KK. Such recommendation is different from that made by her in her previous reports.

10.As said in my judgment handed down on 8 May 2012, custody proceedings are not static but continuing. Hence, I was required to consider the events of the 14 months since the Court of Appeal Ruling. These matters include the fact that the Mother had unilaterally withdrawn KK from APS, the Father’s complaint about the Mother’s breach of the Court Orders and other change of circumstances.

11.The Father said that although he is now earning $125,000 per month, he is on the verge of bankruptcy and is hugely in debt according to his updated Form E.  Part of this liability is the Father’s outstanding legal fees of HK$1,081,617.84.  The total legal costs and disbursements incurred by him has been over $5.2 million excluding the costs for the intended appeal of my order.  He said that he was even unable to pay the MPS since December 2011 that was previously ordered.  Hence, there is no prospect of any costs order being met out of the Father’s assets as he is seriously indebted to the tune of over HK$5,414,000.

12.The Mother takes issue as to whether the Father is on the verge of bankruptcy.  I do not think that I am able to make any finding at this stage. In any event, the Father’s financial position is only one of the relevant factors which I shall take into account.

13.I also have to consider that an order for costs against the Father may further add insult to injury and discourage any possible chance of any co-operation in the future, especially when joint custody of the 2 children has been granted to the parties. Having considered all the relevant circumstances, I am of the view that the Father has not adopted a stance that is beyond the band of what is reasonable.  His application for variation of custody shall not be regarded as totally hopeless although at the end, I rejected most of his arguments.  Accordingly, I dismiss the Mother’s Summons dated 21 May 2012.

14.Lastly, regarding the question of costs of this application, I do not think that I shall penalise the Mother for costs too since the Father admitted that he has failed to pay the MPS to the Mother since December 2011 and the finance of the Mother must be in great difficulty. I also note that she has applied for legal aid on 18 July 2012. Thus, I exercise my discretion to make no order as to costs of this application.

Ms Brown Jain Ruskin of Messrs Hampton, Winter & Glynn for the Applicant

Mr Neal Clough instructed by Messrs Massie & Clement for the Respondent