Colgate Palmolive Company & Anor v Cusson Pty Ltd

Note: This copy of the Court's Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).

1. The application before the Court is that brought by the applicant mother ("the mother') seeking that the respondent paternal grandmother ("the respondent") pay the mother's costs. The application was made on 28 February 2025 seeking:

That the [respondent] pay the ... mother's costs as agreed or assessed of and incidental to her Application in a Proceeding to join these proceedings and the Response filed 22 March 2024, discontinued by Notice of Discontinuance filed 4 February 2025.

1. At the costs hearing - and as set out in the mother's written submissions filed on 12 June 2025 (one day late and just 4 days before the costs hearing) - she sought indemnity costs. The mother's costs agreement was only provided to the respondent at that time.
2. The respondent had sought to be joined in the substantive parenting proceedings between the parents by way of an Application in a Proceeding filed 13 February 2024. In terms of the orders then sought, it was the respondent's position that she would seek time with the child in the event the Court determined that no time should be ordered between the child and the father.
3. The Order for the joinder of the respondent was made by consent on 15 March 2024. The respondent then participated in the preparation of the family report - a process which was already underway. The orders made on 15 March 2024 required that the respondent meet the additional costs of the report writer incurred as a result of further documents having to be read and additional interviews conducted.
4. The family report was completed and dated 3 June 2024.
5. The respondent filed a Notice of Discontinuance on 4 February 2025. This was just 27 days before the final hearing of the parenting dispute, and after the mother and father had filed their trial material.

1. The Family Law Act 1975 (Cth) ("the Act") has recently been amended, including renumbering the sections dealing with costs. The provision that each party bears their own costs unless there are circumstances that justify departing from that rule remains, as does the list of considerations to which the court must have regard.
2. Relevantly, the transitional provisions provide that the amended Act applies to proceedings instituted before and not finally determined before the commencement date (being 10 June 2025) other than proceedings in respect of which a final hearing commenced before that day.
3. The costs application by the mother was brought by way of an Application in a Proceeding. The substantive proceedings to which that application was attached were proceedings in which the final hearing commenced (and concluded) prior 10 June 2025. Accordingly, I am satisfied the Act as it was prior to the 10 June 2025 applies. However, even if I am wrong, this would not change my determination as to the outcome of this application as the matters to which the court is to have regard when considering what costs order, if any, remain almost identical. Only the numbering - but not the substance - of the costs provisions have altered.

1. Pursuant to r 12.13 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 ("the Rules"), applications for costs are to be filed within 28 days of the conclusion of the proceedings.
2. The Notice of Discontinuance was filed on 4 February 2025. That finalised the proceedings between the mother and the respondent. However, the parenting proceedings (being the substantive proceedings on foot at the time the mother filed her application in those proceedings seeking costs against the respondent) did not conclude until 2 May 2025 when I delivered judgment. I do not agree with the respondent's submissions that the mother's application was out of time on the basis that she had 28 days from the filing of the Notice of Discontinuance and the application was only sealed on 5 May 2025.
3. I am satisfied the application was filed within time as the 28 days commenced from the delivery of my final judgment on 2 May 2025. The Court portal shows the application was filed on 28 February 2025, although due to an administrative oversight, my chambers did not seal the application until 5 May 2025.
4. The application for costs had not been served on the respondent until it was sealed on 5 May 2025. It was, however, available on the court portal from 28 February 2025. It was submitted that it was "procedurally unfair" that the respondent had given evidence at the final hearing (as a witness on behalf of her son) when she did not know there was a costs application on foot against her. It was also asserted this had "the potential to be prejudicial" against the respondent and that her evidence could have been affected had she known the application had been brought. There was no articulation of how the respondent could have been prejudiced or disadvantaged and accordingly, those assertions are not made out.

(a) Application in a Proceeding filed 28 February 2025; and

(b) affidavit filed 28 February 2025;

(c) Financial Statement filed 11 June 2025; and

(d) written submissions filed 12 June 2025.

1. In summary, it is the mother's case that the respondent's joinder to the proceedings was not a genuine application to spend time with the child in her own right. Rather, the application was driven by an ulterior motive being to secure the child's time with his father through the respondent. The mother was also critical of the respondent's conduct as a litigant.
2. It was submitted on behalf of the mother that the bulk of the costs incurred after 6 February 2024 and until the respondent discontinued her application were regarding answering the respondent's case, particularly in circumstances where the father was in jail from late 2023 to late 2024. However, no attempt had been made by the mother's representative to identify with any specificity the likely quantum of costs that were attributable only to the dispute with the respondent and those incurred in responding to the father's application. In those circumstances it was proposed that the costs would have to be formally assessed.
3. The respondent relied on the following documents:

(a) Response to an Application in a Proceeding filed on 9 June 2025;

(b) affidavit filed 9 June 2025; and

(c) Financial Statement filed 9 June 2025.

1. The respondent denied that she acted improperly or had an ulterior motive when bringing her application to spend time with the child. She said she had acted appropriately as a litigant and that there was no basis for a costs order to be made.
2. Both parties tendered a number of documents in the course of submissions.

1. The general rule in relation to costs is that each party will bear their own costs. That is set out in s 117(1) of the Act. However, that rule is subject to the provisions of s 117(2). That subsection provides that a court may make such order for costs as it considers just if "...the court is of opinion that there are circumstances that justify it in doing so..."
2. Subsections 117(2A)(a)-(g) of the Act set out the matters the Court must consider in determining whether to exercise its discretion and make an order as to costs. No one factor must be present, and no particular factor is to be given more or less weight than any other.

1. The mother's application for indemnity costs was, as set out, made effectively at the door of the Court.
2. The authorities make it clear that an Order for costs on an indemnity basis ought not be made lightly and is generally considered a great departure from the usual course; see Colgate Palmolive Company & Anor v Cusson Pty Ltd (1993) 46 FCR 225 ("Colgate") per Sheppard J at 233. Indeed, such an order will be made only where there are exceptional circumstances; see Bant and Clayton (Costs) [2016] FamCAFC 35 ("Bant").
3. In Colgate his Honour provided some examples of circumstances that might justify the awarding of indemnity costs. Drawing from that decision, his Honour Holden CJ in Munday v Bowman (1997) FLC 92-784, at 84,660 succinctly set out the following as examples where indemnity costs might be appropriate:

(a) Where it appears that an action has been commenced or continued in circumstances where a party properly advised should have known that he had no chance of success. In such cases the action must be presumed to have been commenced or continued for some ulterior motive or because of some wilful disregard of the known facts...

(b) Making allegations of fraud, knowing them to be false, and the making of irrelevant allegations of fraud...

(c) Evidence of particular misconduct causing loss of time to the court and to other parties...

(d) The making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions...

(e) An imprudent refusal of an offer to compromise.

(Citations omitted)

1. As indicated, the mother asserted the respondent brought her application for time with the ulterior purpose of securing time for the father and child. She said this was by a number of matters, including the respondent's opposition to the mother relocating, by her proposal that time occur near the respondent's home and by her abandonment of her application when the mother proposed the respondent be injuncted from allowing the child to see the father. Additionally, it was submitted the application was unmeritorious, and that the respondent wilfully disregarded the safety issues facing the mother and child.

Financial circumstances of each of the parties to the proceedings

1. The respondent is in paid employment. She owns a property, subject to a mortgage. There was some discrepancy between the respondent's Financial Statement and her taxation return. It is the mother's assertion the respondent may receive an income of as high as $90,000 per year. That is disputed by the respondent who says she receives around $65,000 with some fringe benefits. Given her age she is nearing the end of her working life.
2. The mother is also in paid employment, working part time. According to her Financial Statement she earns about $73,000 per annum. In addition, she receives rental income from a property owned by her of about $27,000 per annum. That property is encumbered by a mortgage. She is currently living with her parents who meet some expenses on her behalf. She says this is not a viable, long term solution. The mother will be required at some point to relocate so she can continue and complete her vocational training. She has the sole care and bears almost all financial responsibility for a young child. She receives almost no financial support from the father towards the child's costs. It is her evidence that she owes substantial funds to her parents for her legal fees.

1. The case law makes it clear that conduct of the parties to the proceedings includes factors such as uncooperative behaviour, prolonging of litigation, filing unreasonable or unmeritorious applications, non-disclosure or some other conduct that leads to an increase in costs by the other party.
2. It is the mother's assertion that she acted at all times in accordance with the Court orders and processes. Conversely, she asserts that the respondent's conduct as a litigant fell short. In particular, the mother was critical that the respondent took no steps to communicate with the mother about seeing the child from 28 June 2022 until 6 February 2024. At that juncture the solicitors for the respondent wrote to the mother seeking time and promptly made an application to join the proceedings just 7 days later. The mother said accordingly no genuine steps were taken by the respondent to resolve the dispute prior to her issuing the application to join.
3. As already noted, it is also asserted by the mother that the respondent was not genuinely seeking time with the child. Rather, it was argued that the application was brought to enable the respondent to facilitate time between the child and the father.
4. Other acts of which the mother was critical of the respondent as to her conduct in the proceedings included:
   • the respondent refused to agree to the mother being able to relocate the child's residence;
   • the respondent's proposals envisaged the mother undertaking the whole of the travel responsibilities between the mother's home and that of the respondent;
   • the respondent's proposals for time did not include any injunction on exposing the child to the father for many months after she filed her application to join; and
   • when the mother made an offer of time that included a restraint on the child having any contact with his father, there was no response from the respondent to that proposal and the application subsequently abandoned.
5. It was asserted these matters provided support to the argument that the respondent's application was made for the ulterior motive of fostering a relationship between the child and the father.
6. The respondent asserted she gave proper notice of her intention to commence proceedings, and that there was some urgency which exempted her from undertaking the usual pre-action procedures. She said her application sought a continued relationship with the child, and to ensure he remained connected to his extended paternal family and cultural heritage. She co-operated with the report writing process and paid additional costs to the expert arising from her joinder application. She filed her material in accordance with Court directions.
7. On balance, I am not satisfied that the respondent's application for time was not bona fide. Nor am I satisfied that she wilfully disregarded facts, that her application for time was unmeritorious or that her conduct as a litigant could otherwise be criticised to the extent that a costs order could be justified.
8. I note that at the time of writing his report, the family report writer contemplated the child spending time with the respondent, to maintain "a thread of connection" with the paternal family. In light of the recommendations made at that time, the application of the respondent in which she sought to maintain a relationship with the child could not be described as without merit. I note further the letter dated 21 June 2024 to the mother in which the respondent indicated she would accept the recommendations of the family report writer and proposed orders reflecting those recommendations to an extent.
9. The further subsequent offer made by the respondent dated 15 August 2024 included a proposed order restraining the respondent from permitting the child having any contact or communication with his father. Accordingly, it could not be said that the respondent was disregarding the potential safety risks if the child was to be brought into contact with his father.
10. The mother's response to that offer was under cover letter dated 22 September 2024 which proposed a far more restricted regime of time. This was not accepted by the respondent.
11. The parties participated in dispute resolution. The respondent participated in that process as it occurred prior to her filing her Notice of Discontinuance. That dispute resolution event would have occurred between the mother and father at any rate, even had the respondent discontinued her application prior to same.
12. The application to discontinue was made after the filing of the mother's trial material. However, the respondent's affidavit formed part of the evidence before me. She was cross examined as a witness for the father. Accordingly, the mother's trial material had to deal with the evidence of the respondent even though she was no longer a party to the proceedings.
13. I accept the trial may have been scheduled for fewer than five days had it been known the respondent would not be a party at the final hearing. However, I am not certain that it could have been anticipated that the trial would have been significantly shorter and the matter may have remained listed for five days even in the absence of a third party. There was potentially a lot to traverse. The respondent did not have other witnesses and as she was called as a witness by the father the number of witnesses was unchanged despite her discontinuance. It was plain that counsel for the father sensibly confined his cross examination of the mother, which truncated much of the evidence.
14. In all the circumstances I do not find the respondent's conduct in instituting, perusing, and then discontinuing the proceedings as providing a justification for an Order for costs to be made.

Whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the Court

Whether any party to the proceedings has been wholly unsuccessful

1. In circumstances where a party has discontinued an application, and there has been no hearing on the merits this consideration is not relevant. This was observed by the Full Court in Bant at [22], where their Honour's noted that this subsection "is designed for cases where an application is heard and determined and...is wholly unsuccessful".

Whether the other party to the proceedings has made an offer in writing to the other party to settle the proceedings

1. As observed each party made proposals to the other, which were tendered in evidence before me. None of the offers were accepted by the parties, and none were adopted by the Court. The offers made prior to trial were to an extent aligned with the recommendations made by the family report writer in his detailed report. However, at trial the family report writer ultimately recommended more robust protection of the mother's wellbeing and supported orders for no time.
2. In all the circumstances it could not be said it was imprudent of either the mother or the respondent to have rejected the proposals made by the other. They were not inappropriate in the context of the case at the time the offers were made.

1. In all the circumstances, I am not satisfied that there is any basis for a costs Order to be made, either on an indemnity or other basis. There are no exceptional circumstances as would be required in order to make an Order for indemnity costs, and no circumstances that otherwise justify departing from the usual rule that each party will bear their own costs. The application is therefore dismissed.

I certify that the preceding forty-seven (47) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Carter.