Gronow v Gronow

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 the pseudonym Meint & B Pty Ltd has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).

1. By way of a Notice of Appeal filed on 28 November 2025, Ms Meint ("the wife") appeals a costs order in favour of B Pty Ltd ("the intervener") made by a judge of the Federal Circuit and Family Court of Australia (Division 2) on 31 October 2025.
2. On 30 September 2025, the primary judge determined issues pursuant to Pt VIII of the Family Law Act 1975 (Cth) between the wife and Mr Lyall ("the husband"). Both the husband and the intervener made applications for costs. On 31 October 2025, the primary judge dismissed the husband's application for costs and made the order under challenge on appeal that:

1. The Applicant pay the Intervener's costs in the sum of $99,916.55.

1. The husband was not named as a party to the appeal.
2. For the reasons that follow, the appeal is dismissed.

1. The primary judge's reasons record:
   1. ...[the husband] is a minority shareholder in [the intervener]. That interest is governed by the terms of a shareholder's agreement.
   2. On 31 July 2025, [the wife] filed a Further Amended Initiating Application seeking relief which infringed upon the rights of [the intervener], and more particularly the rights of the other two founding shareholders, Mr [H] and Mr [J]... Other relief sought was in direct contradiction to the terms of the shareholder's agreement. [The wife] concedes that application fettered the third party shareholder's rights.

1. On 11 August 2025, the intervener's solicitors invited the wife to withdraw those parts of her Amended Initiating Application in the Pt VIII proceedings that directly affected the interests of the intervener, identifying significant deficiencies in that amended application (at [17]). The wife declined to do so.
2. On 25 August 2025, the intervener was joined as a party to the proceeding.
3. On 9 September 2025, the wife further amended her Initiating Application. The intervener, by way of a Case Outline filed on 12 September 2025 detailed how the wife's application continued to infringe the intervener's rights and its constituent members (at [20]).
4. On the first day of the trial, 15 September 2025, the matter was stood in the list to permit the wife to further amend her Initiating Application to seek relief to avoid infringing the rights and interests of the intervener (an issue the intervener had put her on notice about on 11 August 2025 and 12 September 2025). The wife then effectively withdrew that part of her application insofar as it affected the intervener (at [20]-[21]).
5. The contention in the wife's Summary of Argument that after the first day of the trial "B Pty Ltd was no longer a party to the proceeding" is wrong. The intervener remained a party to the proceeding. The wife sought to cross-examine Mr J, a witness in the case of the intervener.
6. The primary judge found that the discontinuance of the wife's application caused the intervener to incur unnecessary costs (at [21]).
7. The primary judge rejected the wife's submission at the costs hearing that the intervener had no basis to seek costs after the first day of the trial because if the intervener had withdrawn from the proceedings, then there would have been no party to call Mr J to give evidence and for him to be cross-examined by the wife (at [23]). The primary judge found that the intervener's ongoing involvement in the proceedings was required to facilitate the wife's request to cross-examine Mr J (at [24]).
8. The primary judge's reasons further record:
   1. ...As a stranger to the matrimonial dispute between the parties, it was not for [the intervener] to be required to incur legal costs to explain a fundamental issue in [the wife]'s case.

...

1. The extraordinary feature of this case is that [the wife] served an application upon a third party which sought to infringe upon its rights and subsequently withdrew the application after it had incurred substantial legal cost. She failed to withdraw the application at the first opportunity to do so. I am satisfied that she should have known that her application had no chance of success.

2. [The wife] opposes an order for indemnity costs, but otherwise does not take issue with the quantum sought by [the intervener]. I find that in the extraordinary circumstances of this case, and despite [the wife]'s now relatively modest financial circumstances, an order for indemnity costs in favour of [the intervener] is appropriate. As a stranger to the litigation, it should not be disadvantaged by [the wife]'s misguided and ultimately withdrawn applications.

(Footnotes omitted)

1. It is well established that, except as to grounds asserting procedural error, for an appellant to succeed in an appeal from an exercise of that discretion, they must bring their appeal within one of the recognised categories of appellate intervention identified by the High Court in House v The King (1936) 55 CLR 499. That an appellate court might have arrived at a different outcome by virtue of affording different weight to various matters does not justify the reversal of the decision of the primary judge (Gronow v Gronow (1979) 144 CLR 513 at 519-520).
2. Orders for costs are peculiarly a matter that are within the discretion of the trial judge and it is only in the rarest of cases that the Full Court should interfere with a costs order (Harris v Harris [1991] FamCA 124; (1991) FLC 92-254; Anison & Anison [2019] FamCAFC 108; (2019) FLC 93-908), save where the result is plainly unjust or if the discretion was exercised on wrong principles.

1. The wife's Notice of Appeal filed on 28 November 2025 contained 13 grounds of appeal. In the wife's Summary of Argument, she abandoned Grounds 1 to 3 inclusive and Grounds 8 to 13 inclusive. The grounds prosecuted will be considered in the groupings and order adopted by the wife during the hearing of the appeal.

**_Ground 4: "The learned trial judge erred in his treatment of post-15 September 2025 costs, in circumstances where [the primary judge] concluded that the Intervenor's ongoing participation in the proceedings was 'necessary' by reason of the [wife] seeking to cross-examine Mr [J], when the transcript and procedural rules do not support such a finding, and where the Intervenor could have been excused without prejudice to the [wife]'s right to cross-examine a non-party witness"

Ground 5: "Further or alternatively, the learned trial judge erred in his finding that the [wife]'s request to cross-examine Mr [J] necessitated the Intervenor's continued involvement in the proceedings with legal representation, in circumstances where such a conclusion was contrary to law, unsupported by the evidence, and involved a misunderstanding of the procedural mechanisms available to compel the attendance of witnesses who are not parties, including the Court's powers to require non-party witnesses to attend for cross-examination"

Ground 6: "The learned trial judge erred in law and in the exercise of discretion by failing to consider whether the costs incurred by the Intervenor after 15 September 2025 were "properly incurred" or reasonably required, as required by s 114UB(2)-(3) of the Act, and erred in awarding indemnity costs for that period notwithstanding that the [wife]'s amended orders no longer affected the Intervenor's rights."_**

1. The gravamen of the complaints by way of these grounds distilled during the hearing of the appeal focus on the conclusion reached by the primary judge as to the intervener's continued engagement in the proceedings from the first day of the trial not being open and otherwise in error, hence costs ought not to have been awarded in favour of intervener after that day.
2. Senior counsel for the intervener at trial said in opening that if the husband were to issue a share transfer notice in accordance with the shareholders agreement, the cofounding shareholders intended to exercise their option to acquire his shares, and the price would be equivalent to releasing the husband from his debt obligations to the intervener company.
3. The wife submits that the ongoing participation of the intervener in the proceedings after the first day of the trial was not "necessary" because the "procedural rules do not support such a finding". The wife further submits that the primary judge misunderstood the procedural mechanisms available to compel the attendance of witnesses who are not parties, for the purposes of giving oral evidence and hence, the ordering of costs payable by the wife to the intervener after 15 September 2025 was in error.
4. The submissions on appeal of the intervener that the wife is bound by her case as conducted before the primary judge and cannot raise the new issues articulated in the grounds on appeal (Metwally v University of Wollongong (1985) 60 ALR 68) have substantial merit.
5. The wife conceded at the hearing of the appeal that the transcript records, on the resumption of the trial on the first day after the wife further amended her relief, each of the parties agreed as to the continued involvement of the intervener in the proceedings (Transcript 15 September 2025, p.3 lines 1-45). The wife on appeal said that the wife's trial senior counsel entered that agreement "in the rough and tumble of a trial" and that doubt existed as to whether the wife's trial senior counsel's mind had turned as to the continued engagement of the intervener having a cost impact on the wife.
6. The intervener remained a party to the proceedings after the wife's amendment to her relief during the first day of the trial. As a party, it was appropriate for the intervener to be represented over the course of the proceedings.
7. The intervener opened its case later during the trial and adduced the evidence of Mr J as agreed by way of affidavit and a proof of evidence (Transcript 17 September 2025, p.187 line 1 to p.189 line 10). Mr J was cross-examined by the wife seeking to challenge the position articulated by the intervener as put during opening (Transcript 17 September 2025, p.190 line 1 to p.191 line 35). The intervener made submissions at the conclusion of the evidence as to the substantive relief sought by the wife (Transcript 17 September 2025, p.227 line 35 to p.229 line 4).
8. The initial relief of the wife to challenge the effect of the shareholders agreement was misconceived. Properly advised, it ought never have been made. The wife was afforded the opportunity to discontinue her misconceived relief but failed to do so, continuing to directly infringe upon the rights of the intervener and its directors and shareholders. The complaint as to indemnity costs not being justified has no merit.
9. The wife at the hearing of the appeal conceded that subject to Ground 7 there was no challenge to the costs as ordered to be paid on an indemnity basis up until the first day of the trial. That submission is not accepted. The wife had every opportunity at the trial to apply to remove the intervener as a party to the proceedings after the resumption on the first day and did not do so. The wife had the capacity to issue a subpoena to Mr J to give evidence. She did not do so. The wife's submission that the "post abandonment costs" were not casually attributable to her own conduct is rejected. Her submission that there was no basis or power to order the post abandonment costs was not supported by any reference to statute or principle and is not established.
10. The wife's efforts on appeal to challenge the impact and effect of her own pre-trial forensic decisions, and those made at trial, have no merit. Grounds 4, 5 and 6 are rejected.

Ground 7: "The learned trial judge erred in failing to consider, or in giving insufficient weight to, the [wife]'s financial circumstances for the purposes of s 114UB(3)(a) of the Act, including her age pension income, inability to meet her reasonable housing needs without sale of her home, and the disproportionate financial impact of an indemnity costs order upon her."

1. The ground is misconceived. The primary judge clearly identified and considered the wife's submissions as to her financial circumstances (at [4]). This factor was weighed by the primary judge (at [6] and [29]), concluding that notwithstanding the relatively modest financial circumstances of the wife, an order for indemnity costs in favour of the intervener was justified, and the order as made was just. This ground fails.

1. No ground of the appeal has merit. The appeal will be dismissed.

1. In the event the appeal was dismissed, the wife properly conceded that she could not oppose the making of an order that she pay the intervener's costs of the appeal fixed in the sum of $15,000. Such order will be made.

I certify that the preceding twenty-nine (29) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Campton.