Boorer v HLB Mann Judd (NSW) Pty Limited (No. 2)

The case of Boorer v HLB Mann Judd (NSW) Pty Limited (No. 2) involved the plaintiff, Mr. Boorer, suing the defendant, a firm of accountants, for professional negligence in the context of tax advice given. The High Court of Australia was tasked with determining the appropriate assessment of costs, particularly in relation to the costs incurred following a rejected Calderbank offer. The plaintiff had made a formal offer of settlement under section 32 of the Uniform Civil Procedure Rules 2005 (NSW), which the defendant rejected. The plaintiff subsequently obtained a more favourable outcome at trial and sought costs pursuant to section 42 of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW).

The court was required to determine whether the costs incurred after the defendant's rejection of the Calderbank offer could be recovered by the plaintiff. This involved interpreting the relevant legislation and case law regarding the assessment of costs following unsuccessful settlement offers. The court had to weigh the principles of encouraging settlement against the potential for punitive cost awards.

In its judgment, the High Court held that the trial judge had discretion to assess costs following a rejected Calderbank offer and that this discretion was not limited to the costs incurred before the offer was made. The court emphasised that the assessment of costs should be fair and just, taking into account all relevant factors, including the nature of the offer, the outcome of the litigation, and the conduct of the parties. The court found that the trial judge had exercised his discretion appropriately in the circumstances of this case, and thus upheld the order for costs.

The final orders of the court affirmed the trial judge's assessment of costs, allowing the plaintiff to recover the costs incurred after the rejected Calderbank offer. This decision reinforces the importance of considering the full context when assessing costs and provides guidance for future cases involving similar issues.