123 259 932 Pty Ltd v Cessnock City Council (Costs)

In *123 259 932 Pty Ltd v Cessnock City Council (Costs)*, the appeal concerned the appropriate basis for quantifying costs following earlier proceedings. The primary dispute revolved around whether the appellant, 123 259 932 Pty Ltd, should be awarded its costs on an indemnity basis, or whether the standard basis was appropriate. The court was required to consider the impact of pre-trial offers of compromise and Calderbank offers made by the appellant on the exercise of the court's discretion regarding costs.

The central legal issues were whether the rejection of the appellant's pre-trial offers, coupled with the perceived complexity of the issues at trial, warranted an order for costs on an indemnity basis at first instance. Furthermore, the court had to determine whether any of the pre-trial offers, or the circumstances of the appeal itself, provided a basis for an indemnity costs order on appeal, and whether interest on costs should be awarded.

The court reasoned that while pre-trial offers are a relevant consideration in the exercise of discretion regarding costs, the mere rejection of such offers, particularly where the issues were not straightforward, did not automatically justify an indemnity costs order. The court found no basis to depart from the standard basis for costs at first instance. Similarly, the court found no grounds to make a special costs order on appeal, as none of the offers made prior to the appeal were of a nature that would warrant an indemnity costs order at first instance, nor did the appeal proceedings themselves present a reason for such an order. Regarding interest on costs, the court noted that the default position under the relevant legislation is that interest runs from the date of the costs order, and in the absence of evidence or argument to the contrary, no specific order for interest on costs was necessary.

The court ordered that the respondent pay the appellant $12,740.81, representing interest on a sum previously ordered. The court also noted that interest on the costs payable under the earlier order would be included in the assessed costs pursuant to the *Legal Profession Uniform Law Application Act*.