A, DC v Prince Alfred College Inc (No 2)

The Full Court of the Supreme Court of South Australia considered an appeal concerning the costs of an action brought by A, DC (the appellant) against Prince Alfred College Inc (the respondent). The dispute arose from proceedings in the District Court, where the appellant had been unsuccessful in its claim.

The central legal issue before the Full Court was whether the District Court judge had erred in ordering that the appellant pay the respondent's costs of the entire action, despite the appellant having succeeded on one of its claims. The appellant argued that the costs order should have reflected its partial success, and that the judge had failed to properly consider the principles of indemnity and proportionality in making the costs order.

The Full Court reasoned that the general rule that costs follow the event is not absolute and that a judge retains a discretion to depart from it. However, this discretion must be exercised judicially, taking into account all relevant circumstances. In this instance, the Full Court found that the District Court judge had failed to adequately explain the reasons for departing from the general rule and for ordering the appellant to pay the costs of the entire action, particularly in light of the appellant's partial success. The judge had not properly considered the proportionality of the costs awarded to the success achieved.

Consequently, the Full Court allowed the appeal, set aside the costs order made by the District Court, and remitted the matter back to the District Court for redetermination of the costs of the action.