Henschel & Sartre (No 8) [2025] FedCFamC1F 360 (30 May 2025)

Note: The form of the order is subject to the entry in the Court's records.

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 the pseudonym Henschel & Sartre has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).

1. Ms Henschel ("the wife") and Mr Sartre ("the husband") married in early 2003 and separated on 20 April 2020. Proceedings commenced on 2 September 2020. A divorce order was made in mid-2023. There is one child of the marriage, whom is currently 16 years old, and who lives with the wife and spends time with the husband.
2. Parenting, child support and property matters were listed for a 10-day trial before Bermann J to commence on 4 December 2023. The trial did not proceed and was adjourned to commence again before Bermann J over 10 days commencing on 26 February 2024. The parenting and child support matters were concluded to a defended hearing. On 23 May 2024, after four years of pitched and intensively contested litigation including seven days of trial, judgment was delivered and orders were made as to parenting of the then 15-year-old child of the parties and as to periodic and non-periodic child support departure payable by the husband.
3. On 31 March 2025, after a further five days of trial, orders pursuant to s 79 of the Family Law Act 1975 (Cth) ("the Act") were made adjusting the property of the parties. The wife received 45.5 per cent of that property, valued at $14,006,379, and the husband received 54.5 per cent, valued at $16,776,872. These reasons assume familiarity with the judgment delivered on the same day (Henschel & Sartre (No 7) [2025] FedCFamC1F 204). The reasons record:
   1. The parties each seek nuanced orders in the adjustment of their property. After four and a half years of litigation, incurring combined legal costs of more than $3.45 million and the current five-day trial event, with the benefit of experienced senior and King's counsel and accredited solicitors, the husband and the wife were requested to provide a joint proposed minute of the orders sought by each in Exhibits 43 and 48 that were agreed, with a common set of definitions. That request could not, being emblematic of the litigation, be fulfilled.
4. The conflict between the parties since separation, spilling into the proceedings and generating disproportionate legal costs for each, has continued. The costs now incurred are $1,638,027 by the wife and $1,938,675 by the husband.
5. At the hearing on 27 May 2025, the following orders were made:

1. The listing of the Application - Enforcement of the husband filed 16 May 2025 before a Judicial Registrar on 18 June 2025 is vacated. 2. The Application - Enforcement of the husband filed 16 May 2025 be returned instanta. 3. By consent:

1. By way of implementation of Order 6 made on 28 July 2022 as to the costs of the expanded scope of work to be undertaken by the ch 7 single forensic accounting expert, the wife's responsibility to meet half of that cost shall be achieved by deducting from the payment to be made by the husband to the wife pursuant to Order 10(a) made on 31 March 2025 the sum of $28,336. 2. The Application - Enforcement of the husband filed 16 May 2025 and any response thereto are dismissed. 3. In circumstances where the husband paid to the wife 50 per cent of the fees rendered by the ch 7 single quantity surveyor expert on 26 May 2026 in the sum of $8,939 pursuant to orders made on 29 November 2024 the relief sought in paragraph 1.1 of the Application in a Proceeding of the wife sent for filing on 24 April 2025 and filed on the court portal on 29 April 2025 is dismissed.

1. Judgment is otherwise reserved.
2. These reasons determine:

(a) The balance of the Application in a Proceeding of the wife filed on 29 April 2025 seeking discrete costs payable by the husband of issues arising out of the substantive proceedings, being:

• 1.2 The parties adducing single expert plant and equipment valuation evidence by [Mr BH] of [BE Valuers], being at a cost to the wife of $10,862.50.
• 1.3 The husband's Application in a Case filed 23 February 2021 which sought an interim financial order as to $500,000, and which was dismissed on 27 May 2021, such costs claim at a fixed sum of $29,745.28 including fees to Senior Counsel in accordance with Part 2 Schedule 3 of the Rules.
• 1.4 The wife's Application in a Case filed on 9 December 2024 which sought urgent injunctive relief regarding the occupancy of the farming property known as [N Property], which Application was consented to by the husband on 13 December 2024 with costs then reserved, and in respect of which the wife seeks fixed costs at $1,681.20.
• 1.5 This Application in a Proceeding.

In the alternative to the quantification of costs as fixed sums, the wife seeks her costs to be as agreed or assessed. In either event, payment of costs is sought within 28 days.

(b) The Response to an Application in a Proceeding of the husband filed on 15 May 2025 that the wife's relief for costs be refused, and for the wife to pay his costs of opposing the costs application.

1. For the reasons that follow, the husband is to pay $9,486.45 to the wife within 28 days and the costs of the wife in meeting his Application in a Proceeding filed on 23 February 2021 as determined on 27 May 2021 at scale as agreed or assessed.

1. The relevant principles as to costs are well settled. While the starting position established by s 117(1) of the Act is that each party pays their own costs, s 117(2) allows the Court to make such orders as to costs as it considers just if there are circumstances which justify it doing so. In considering what order for costs, if any, should be made, the Court is required to have regard to the matters set out in s 117(2A) of the Act and give weight as it considers appropriate to any relevant factor. It is well settled that no single factor in s 117(2A) has priority, nor must more than one factor be satisfied. Rather, any one factor may be sufficient.
2. The wife bears the onus to establish circumstances which justify departing from the position that each party pay their own costs, for the making of a costs order in her favour. If the wife establishes there are circumstances justifying a costs order, the next consideration is on what basis should costs be paid.
3. The Full Court has made clear that it is unnecessary to spell out detailed reasons for decisions in costs matters. I shall refer to such s 117(2A) matters as are relevant and engaged here.

1. After the s 79 determination, each party has the benefit of significant property. The affidavit evidence of the parties broadly contends that each is currently "asset rich and income poor". It was not submitted by either party that their current financial circumstances, in and of themselves, would militate for or against a circumstance justifying the exercise of a costs discretion. The financial circumstances of each party are a factor to be given some weight.
2. Each of the categories of costs claimed by the wife will be considered in the sequence adopted by the parties in their written and oral submissions. In the event of establishing that the circumstances are justified for each category of costs claimed they will be the subject of separate order, if just.

Category Claim 2 - The wife's 50 per cent share of fees paid to the ch 7 single plant and equipment valuation expert

1. The fees paid to the single plant and equipment expert appointed pursuant to ch 7 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) ("the Rules"), BE Valuers, was $21,725. Each party has paid half of that cost, being $10,862.50. The reports of Mr BH, the expert from BE Valuers, are dated 24 December 2024 and 5 March 2025.
2. The wife seeks reimbursement from the husband of her payment of the one-half costs of the expert's fees as paid by her contending that "the valuation exercise" [of the single plant and equipment expert] was "sabotaged" by:

(a) The husband's insistence that the single expert enter a "confidentiality agreement" rendered the report and exercise obtaining it without utility because it undermined any useful valuation conclusions; compounded by

(b) The husband's conduct delaying the provision of the 5 March 2025 report until the third day of the trial. This resulted in the opinion not being used as an integer of the opinion in the ch 7 single forensic accounting valuation evidence.

1. The husband identifies that consent orders were made on 14 August 2024 for each party to pay half of the costs of the expert. This is confirmed by r 7.06 of the Rules providing that, subject to order, each party pay half of the costs of the single expert.
2. The wife, by way of a series of letters between 9 October 2024 to 7 November 2024 to the husband, identified that the terms of the confidentiality agreement that the husband insisted the expert enter would limit the ability of the expert to conduct research to base his opinion upon.
3. The contended conduct of the husband in failing to comply with directions for trial and the provisions of the Rules generated a relisting application by the wife on short notice on 29 November 2024. Recital F and the orders made on that day recorded:
   1. The parties have engaged [Mr BJ] as the Single Expert to prepare a valuation report of the plant and equipment at the [Suburb J] property. The respondent requested the single expert plant and equipment valuer, [Mr BJ], to sign a Confidentiality Agreement on 12 November 2024. The expert executed the Agreement. The applicant reserved her position as to the appropriateness of that request and the terms of the Agreement

...

1. That the respondent facilitate the attendance of [Mr BJ] as the single expert plant and equipment valuer at all premises at which plant and equipment is located within the scope of the expert's terms of engagement and the Confidentiality Agreement signed on 12 November 2024, and that such access be unhindered by the respondent or any agents over whom he has authority.
2. That the respondent facilitate the expert's inspection of the relevant items as per Clause 21 of the Confidentiality Agreement, with such expert to nominate the relevant date of inspection upon providing the respondent with seven days notice.

1. The 24 December 2024 report of Mr BH records the following:

2.6.10 As part of this valuation, [BE Valuers] have signed a Confidentiality Agreement (Appendix E) which states in part the following:

22. No contacting of service technicians, machinery manufacturers, machinery dealers including auction houses and agents for both new and second hand machinery or shopping the machinery details around to any dealers both in Australia and abroad.

23. No contacting of the Information Provider's clientele including past clientele where the Information Provider completed works of any nature.

24. No contacting present past employees of [B Pty Ltd].

25. No photographic equipment ie cameras, mobile phones nor video recording devices will be permitted to be operated in the factory premises of the Information Provider.

26. No cupboards will be opened nor employee / company vehicles or lockers of employees within the premises of the Information Provider.

2.6.11 The restrictions outlined in the Confidentiality Agreement, particularly Point 22 and Point 25 of the additional provisions, have limited my ability to conduct my usual research and the subsequent compliance review process. My research process normally involves engaging with original equipment manufacturers (OEM's) and other machinery dealer sources to obtain key information. This information includes:

• New and used equipment dealer opinions

• Market conditions regarding saleability and factors affecting machine value

• Decommissioning and removal costs

• Technological and functional obsolescence issues of the subject machinery

• Estimated cost of repairs if necessary

• Availability of machinery and spare parts

2.6.12 These limitations have impacted my ability to conduct thorough research and formulate a fully concluded value opinion. Despite the limitations outlined above, I have made endeavours utilising the available information, my professional experience and general knowledge of this type of equipment in order to ascribe credible value conclusions that whilst not fully concluded, represent the most accurate value conclusions in the absence of the previously noted research and information.

2.6.13 In forming my professional opinion, I have drawn on my near 11 years of experience in plant & equipment valuation, as well as insights gained from previous valuations of similar equipment. However, some of the machines listed in this report are highly specialised and custom configured to align with the operational requirements of the business. Given this level of specialisation, it is challenging to determine factors including those outlined above that will have an impact on the ascribed values. While my experience in valuing joinery business been applied to somewhat mitigate these limitations, the absence of key information would normally be researched through contacting industry experts has significantly restricted my ability to provide a fully conclusive assessment.

(As per the original)

1. The 24 December 2024 report of Mr BH recorded qualifications to his opinion in two respects:

(a) That at least 12 items were not made available for inspection, leading to the making of "extraordinary assumptions" as to the condition and maintenance of the items should be considered an estimate only; and

(b) The terms of the confidentiality agreement did not permit him to formulate a concluded opinion as to the value of the plant and equipment.

1. The husband's affidavit evidence disputing the qualifications identified in the 24 December 2024 report of Mr BH attract little weight, as does the letter from his solicitors on 24 February 2025 inviting Mr BH to advise "what restrictions are preventing the finalisation of the report". The content of the expert's report speaks for itself.
2. The evidence of the husband as to the reason he insisted that the ch 7 plant and equipment valuation expert enter a confidentiality agreement was:
   1. On 8 October 2024, I proposed that the single expert valuer enter into a Confidentiality Agreement. Whilst [Ms Henschel] expressed concerns about the appropriateness of the Confidentiality Agreement she agreed to the document being sent to each valuer on 9 October 2024. The reason I sought the Confidentiality Agreement was because in or around 2023 [Ms Henschel's] solicitors sent a letter to my staff at the [Suburb J] factory purporting that the building would be sold and as result of my staff being informed of this, approximately 30% of my staff subsequently resigned. I was concerned that should the single expert reach out to competitors and/or staff members this would have a flow on effect and give further uncertainty to my remaining staff.
3. The letter referred to in the husband's affidavit was a letter from the wife's solicitors to B2 Pty Ltd dated 20 November 2023 (Exhibit 1). B2 Pty Ltd is owned two thirds by the Mr Sartre and Ms Henschel Family Trust by way of its corporate trustee, B6 Pty Ltd, being the property of the parties, and one third by the husband's business partner, Mr AD, by way of a different corporate trustee. Exhibit 1 is not directed to the staff at the Suburb J factory or their employer. It is directed to the corporate owner of the real property. The husband did not explain why it was either appropriate, or necessary, to inform employees as to the contents of a letter sent by the wife's solicitors. The letter was in the context of the s 79 litigation, putting B2 Pty Ltd, not being a party to the litigation, on notice as to the possibility of orders being made as to the sale of its Suburb J factory. I do not accept that any reasonable foundation existed, on the evidence of the husband, to link Exhibit 1 with the necessity of a ch 7 single expert to enter a confidentiality agreement. Further, Div 7.1.5. of the Rules identifies a single expert's duties and rights, including a prevailing duty to the court that, at least inferentially, requires that an expert is not to use any document or information instructed or accessed in the discharge of their function other than for the purposes of the litigation. Absent further evidentiary foundation, I do not accept that it was necessary or appropriate for the husband to insist that the plant and equipment expert enter the confidentiality agreement in the terms he mandated, albeit that the expert did enter that agreement.
4. The terms of the confidentiality agreement limited the scope of the expert's inquiry that in turn impacted on the probative value of the expert's opinion. I accept the submission of the wife that the exchanges between she and the husband through letters between their respective solicitors as to the fact and entry of the confidentiality agreement and its consequential impact on the 24 December 2024 report of Mr BH was unnecessary. Its product did not permit Mr BH to formulate a concluded opinion as to the value of the plant and equipment he inspected for the purposes of that report. The exchanges between the solicitors for the parties on these matters ought not to have been necessary. It unnecessarily increased costs, including for part of the listing on 29 November 2024.
5. The husband acknowledges there was delay in providing responses to the valuer's requests dated 10 January 2025, submitting that the delays were outside of his control because some items were at the property at N Property, Town O ("the N property") occupied by the wife, or because of a genuine administrative error by his solicitors. The identity of the 12 unsighted assets identified in the 24 December 2024 report were sourced from depreciation schedules. The husband closely shepherded the process of inspections by the single expert at the Suburb J premises. The expert's report records him speaking to "company staff or other parties" to assess the assets not sighted. I find that the husband knew, or ought to have known, that arrangements were necessary to ensure that the ch 7 single expert had reasonable access to the items to discharge his function, wherever they were located. There is no evidence adduced by the husband by way of a letter to the wife's solicitors or to the expert facilitating the expert's access to any of those items that were at the N property. I am satisfied that the husband's delays in turn delayed the production and release of Mr BH's second report until the third day of the trial, being on 5 March 2025.
6. The husband submitted that the wife was not prejudiced in the delay in the provision of the BE Valuers opinion until after the commencement of the trial. It was agreed that the husband would retain the entities owning the plant and equipment. He said that the value of the pool of the property of the parties at trial achieved an uplift that favoured the wife because the reached agreed value of the plant and equipment was at the value recorded in the depreciation schedules of corporate entities. This value was $772,611 greater than that opined by the expert in his 5 March 2025 report. That agreement was achieved on the last day of the trial**,** being on 7 March 2025.
7. A consideration of all of the above matters as to conduct justifies a requirement for the husband to contribute to the wife's costs paid to the plant and equipment ch 7 single expert, but not on an indemnity basis. The requirement of the entry into a confidentiality agreement, the factors delaying the provision of the 5 March 2025 opinion and the costs incidental to the issues each created conclude that it is just for the husband to pay 75 per cent of the expert's fees. This will result in the husband paying to the wife 25 per cent of the value of the expert's fees, being $5,431.25. Such order will be made.

Category Claim 3 - The husband's Application in a Proceeding filed on 23 February 2021

1. To give context to this dispute the primary reasons record:
   1. On 29 June 2020 the wife withdrew and retained $500,000 from a joint ANZ account [...73].

...

1. As between the parties, the wife has been the primary carer of [X] since separation. Since separation the wife has expended funds on rental accommodation in Sydney because [X] attends school in Sydney, in addition to having occupation of the [N property] as her residence. The wife requested financial support from the husband to assist the costs of her rental accommodation as well as for other expenses. The husband refused, citing the reason being that $500,000 retained by the wife from a joint account at separation ought to meet that cost.
2. The wife has been primarily responsible for [X's] financial support on a day-to-day basis, notwithstanding child support paid from the husband. The costs of her own self support and of [X] has been funded by way of her income and the $500,000 she received from the parties' joint account at separation. The husband agreed in cross-examination that part of the $500,000 was for the wife's maintenance. The wife's unchallenged evidence, that I accept, is that she has reasonably applied those funds, including $322,844 for her legal fees in these proceedings, $108,415 for her bond and rental expenses, $13,800 for her legal fees in criminal proceedings, $12,325 for farming expenses, $3,418 for expenses for [X], $15,537 for legal disbursements and $12,325 to general living expenses.

1. The husband's Application in a Proceeding filed on 23 February 2021 sought a single order for the wife to pay $500,000 into the parties' joint account. The wife in her Response to an Application in a Proceeding filed on 3 March 2021 sought for the husband's Application in a Proceeding to be dismissed, orders as to disclosure, and orders to facilitate prior orders as to obtaining ch 7 single expert evidence. The wife sought the costs of and incidental to her response on an indemnity basis. These interlocutory disputes were listed for hearing before Harper J on 27 May 2021. The parties entered consent orders at that hearing providing for:

(a) the husband's Application in a Proceeding to be dismissed;

(b) the husband to comply with previous disclosure orders of the Court;

(c) the husband to facilitate prior orders as to obtaining ch 7 single expert evidence and further cause payment of an invoice in the sum of $5,500 to the expert; and

(d) the wife's costs to be reserved to the trial.

1. The wife submitted that the husband's application was always misconceived. The wife's submission resonates with the primary reasons (at [159]-[160]). At that time the husband controlled and had the benefit of the lion's share of the patrimony, financial resources and income sources available to the parties. It was uncontroversial that the value of the property to be adjusted to the wife was greater than $500,000 and hence the husband's substantive property claim would not be defeated.
2. The husband submitted that he took a pragmatic approach to resolve the interim dispute. He contended that an order for costs of his dismissed Application in a Proceeding is not justified because, in reality, it occasions a reverse engineering to look behind the agreement reached by way of compromise in the orders made on that day. I do not accept that submission. By agreement, the wife's costs alone, and not the husband's, were reserved. The application of the husband, having regard to the value of the property to be adjusted between the parties and the fact that the husband had the benefit of most of it, coupled with his income and resources, concludes that the Application in a Proceeding filed on 23 February 2021 was overly optimistic, misconceived, or blinkered.
3. The circumstances justify that the husband pay the wife's costs in responding to his Application in a Proceeding filed on 23 February 2021 up to and including the hearing listed on 27 May 2021, but not the costs incurred by way of other relief sought in her Response to an Application in a Proceeding filed on 3 March 2021 that went to other issues.
4. The wife sought for her costs to be paid in a fixed sum said to be at scale of $29,745.28. The husband opposed the fixing of costs. The touchstone as to the fixing of costs is to ensure that its process is logical, fair, and reasonable. The wife had an opportunity to adduce evidence of a schedule of the costs claimed identifying the items claimed and the charges at scale as prescribed by the Rules to support the fixing of the quantum of costs but failed to do so. The husband did not respond to an inquiry during the hearing as to the value of costs he incurred for the purposes of his Application in a Proceeding and the interim hearing on 27 May 2021. It would occasion injustice to the husband to even apply the broadest of brushes to fix costs in a vacuum. While it unfortunately will likely lead to further satellite disputes, I am left with no alternative but to require the parties to agree or engage in the expense, delay, and aggravation arising out of an assessment of costs. Costs will be paid by the husband as agreed or assessed.

Category Claim 4 - The wife's Application in a Proceeding filed on 9 December 2024

1. On 23 February 2023 interlocutory orders were made by Berman J permitting the husband to attend the N property once a month conditional on him providing the wife with 24 hours' notice of his intention to attend, and that the wife was residing in Sydney at the time.
2. The primary reasons record:
   1. The [N property]currently is [more than 250 hectares]. It has a substantial split level architecturally designed residence. The wife currently resides in the [N property].

...

1. In or around October 2021 the husband was charged with malicious damage due to the removal of security cameras at the [N property]and a provisional Apprehended Violence Order ("AVO") was issued against the husband listing the wife as the protected person. That charge was listed for a final hearing [in late] 2022.

...

1. Between July and December 2023 issues arose between parties as to the husband's access to the [N property]. Spotfire disputes again arose between the parties as to the husband's access to the [N property]between July and December 2023. On 6 December 2023 orders were made regulating the husband's access to the property.

...

1. Between January 2024 and November 2024 multiple disputes again arose between the parties as to the husband's access to the [N property].

(Emphasis added)

1. The wife was notified that the husband intended to stay with his family at the N property over the weekend commencing on 13 December 2024. The wife proposed to be outside Australia from December 2024 until January 2025. She put the husband on notice on 2 December 2024 that if he attempted to attend the property as foreshadowed, she would commence contravention proceedings and would seek costs. On 3 December 2024 the husband's solicitors reiterated that the husband intended to stay at the N property over the weekend commencing on 13 December 2024. The husband later refused to sign an undertaking that he would not enter the N property over the weekend commencing on 13 December 2024. On 9 December 2024, the wife filed an Application in a Proceeding seeking to vary the interim order to restrain the husband from attending the N property between [...] December 2024 and January 2025 while she was overseas.
2. On 13 December 2024 the following order was made:
   1. Pending further order and without admissions on the part of the husband the operation of Order 7 made 23 February 2023 be varied to restrain the husband from attending the property at [N property, Town O] ("the [N property]") between 13 December 2024 and 26 January 2025 on the basis that such variation would otherwise not derogate from the order made on 23 February 2023.
3. The husband's conduct forecasts a failure to comply with the order made by Berman J on 23 February 2023. He knew that attending the N property was a lightning rod event in the context of the proceedings. The order made on 23 February 2023 implicitly directed that he could not stay at the N property over a weekend in December 2024. His conduct necessitated the application of the wife, incurring unnecessary costs, thereby justifying costs.
4. The wife's costs are sought in a fixed sum of $1,681.20 said to be at scale, being incurred for work undertaken by her solicitor up to but not including the listing on 13 December 2024, that date also being a case management event. Having regard to the quantum claimed and the implicit necessity of the wife to provide instructions and prepare documents, it would not occasion injustice to the husband to fix the costs as sought. Such order will be made.

1. The fixed costs orders are for $5,431.25 and $1,681.20. The wife sought that these costs be paid within 28 days. The husband has capacity by way of income and resources to do so. His costs notice records $28,466 held in his solicitor's trust account. In the circumstances, such order to be paid within 28 days is just.

1. The wife sought costs of the costs application fixed at $2,374. Notwithstanding that he had the benefit of experienced solicitors, there is no evidence adduced as to the husband making any offer to compromise the costs application of the wife. That circumstance, coupled with the success of the wife as identified earlier in these reasons, justifies that the husband pay the costs of the wife's costs application.
2. The husband incurred costs of $6,696 in opposing the costs application of the wife. He did not put into issue the quantum of costs claimed by the wife. The husband will pay the wife's costs of the costs application fixed at $2,374 within 28 days.
3. The sum of the three fixed costs determinations payable by the husband to the wife is $9,486.45. Each payment of these costs will be consolidated into a single order.
4. By way of a minute of order provided during the hearing but not marked as an exhibit, the parties agreed to each pay their own costs of and incidental to the husband's enforcement application filed on 16 May 2025. Such order will be made.

I certify that the preceding forty-three (43) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Campton.