BP v State of New South Wales (No 2)

The appeal in *BP v State of New South Wales (No 2)* was heard by Meagher, Payne and McCallum JJA of the Court of Appeal of New South Wales. The dispute concerned the costs of an appeal that had become futile and was therefore determined without a decision on the merits.

The central legal issue before the Court of Appeal was whether any order for costs should be made, given that the appeal had been discontinued due to its futility, and both parties had acted reasonably in the circumstances.

The Court reasoned that in situations where an appeal becomes futile and is discontinued, and where both parties have conducted themselves reasonably, it is appropriate to make no order as to costs. This approach acknowledges that neither party is to blame for the situation that led to the discontinuance of the appeal, and therefore, imposing costs on one party would be unjust. The Court applied the principle that costs follow the event, but that this principle is not absolute and can be departed from in exceptional circumstances, such as those presented in this appeal.

Consequently, the Court of Appeal made no order as to costs.