Amaca Pty Ltd v Hicks (No 2)

In this matter before the New South Wales Court of Appeal, the appeal was brought by Amaca Pty Ltd against a judgment of the Dust Diseases Tribunal in favour of Mr Hicks, who suffered from asbestosis. Mr Hicks had been awarded damages of $354,423.19. Following the dismissal of the appeal, Mr Hicks sought an order for his costs to be assessed on an indemnity basis from a specified date.

The primary legal issue before the Court of Appeal was whether Mr Hicks's offer of compromise, made in accordance with the Uniform Civil Procedure Rules 2005 (NSW) ("UCPR"), constituted a genuine compromise for the purposes of triggering indemnity costs. Specifically, the Court had to determine if the offer to accept $340,000, a reduction of approximately 3.8% from the awarded damages, was sufficient to be considered a "compromise" under the relevant rules, thereby entitling Mr Hicks to indemnity costs from the day after the offer was made.

The Court of Appeal, applying UCPR rules 51.47 and 51.48, confirmed that Division 4 of Part 20 of the UCPR applied to appeal proceedings. It was noted that Mr Hicks had obtained a judgment that was no less favourable than his offer, which ordinarily entitled him to indemnity costs under UCPR rule 42.14(2). The Court considered whether the reduction offered was "real and not trivial or contemptuous," referencing precedent that a discount of approximately 2.5% was considered a real diminution. The Court found that the offered reduction of less than 5% was sufficient to constitute a compromise.

The Court of Appeal varied the original orders, dismissing the appeal and ordering Amaca Pty Ltd to pay Mr Hicks's costs. These costs were to be assessed on the ordinary basis up to and including 11 February 2011, and on an indemnity basis from 12 February 2011 onwards, including the costs of the motion.