Bennette v Cohen (No 2)

In *Bennette v Cohen (No 2)*, the New South Wales Court of Appeal considered an application to rescind and vary previous costs orders made in relation to an appeal. The dispute concerned the appropriate basis for awarding costs, specifically whether an earlier offer of compromise justified an order for indemnity costs for a portion of the proceedings.

The primary legal issues before the Court of Appeal were whether an offer of compromise made five years prior to the appeal was a genuine offer of compromise, whether it was reasonable for the respondent to reject that offer, and consequently, whether the successful party was entitled to costs on an indemnity basis for the period after the offer was made. The court also had to determine whether to grant a stay of orders pending an application for special leave to appeal to the High Court.

The Court of Appeal reasoned that the offer of compromise, despite its age, was genuine and that the respondent's rejection of it was unreasonable in the circumstances. Applying the principles governing departure from the ordinary rule for costs, the court found that the conduct of the parties warranted an order for indemnity costs from the date of the offer. The court rescinded a previous order and substituted new orders regarding the costs of the proceedings at first instance and the appeal. The court also dismissed the respondent's subsequent notice of motion seeking a stay of proceedings.