Senior Member Howell determined today in M v JC Lawyers [2007] VCAT 273 that VCAT had jurisdiction to entertain a costs dispute about solicitor-client fees of post-proceedings negotiations under the threat of mutual applications to reopen under the change of circumstances provisions the final orders of the Family Court made 9 years previously.The Family Law Act, 1975 is peculiar in that the principle of res judicata is eroded by provisions allowing applications to be made to vary final orders in the case on one party’s change of financial circumstances. Nine years after the final orders were made by consent, that is what was threatened here, by the husband. He threatened to apply for an order cancelling his maintenance obligations. The solicitor involved in the VCAT proceedings was for the wife. The wife responded by threatening to apply for an increased maintenance obligation. Neither threatened obligation was ever made. Despite the fact that the negotiation was in relation to mutual threats to reopen the final orders made in the Family Court proceedings, Senior Member Howell found as a fact that it was not incidental or even related to those proceedings [15] and found as a consequence that VCAT had jurisdiction.
Put that way, it was a surprising conclusion. An application to reopen proceedings is obviously related to those proceedings. But, as Senior Member Howell observed, VCAT’s predecessor, the Legal Profession Tribunal, consistently held that it had jurisdiction to entertain costs disputes over fees charged in family law disputes where no proceedings were ever commenced. The Commonwealth Family Law Act, 1975 prevailed over the Victorian Legal Practice Act, 1996 because of the Constitutional primacy of federal legislation over inconsistent state legislation. The relevant Federal legislation was in fact the rules made under the Family Law Act, 1975. The scope of the rules about solicitor-client costs disputes is limited to costs of “proceedings”. They are defined by s. 4 of that Act to mean “a proceeding in a court, whether between parties or not, and includes cross-proceedings or an incidental proceeding in the course of or in connexion with a proceeding.”
Another method of coming to the same correct conclusion as VCAT reached might have been that though an application to reopen earlier proceedings is either properly conceived of as a reprise of the earlier proceedings, or a new proceeding in connexion with the earlier proceeding, since nothing ever happened again in the Court, the principle that there is no jurisdiction over disputes about pre-proceedings costs of threatened Family Court proceedings which never eventuate was applicable.
