Brighten v Traino (No 2)

The applicants, Brighten and another, sought to vary costs orders made on 8 July 2019, specifically to revoke an order that would have had the effect of reinstating a costs order made in the District Court on 30 July 2018. The respondents, Traino and another, had made an offer of compromise in relation to the appeal. The dispute concerned whether this offer was a genuine compromise and whether the appeal was doomed to fail, thereby justifying the revocation of the earlier costs order. The matter was heard by Basten, Gleeson, and Brereton JJA of the Court of Appeal of New South Wales.

The primary legal issues before the Court of Appeal were whether the offer of compromise made by the respondents was a genuine offer to settle the proceedings, and whether the appeal was so lacking in merit that it could be considered doomed to fail. These questions were central to determining whether the court should exercise its discretion to revoke the costs order made on 8 July 2019, which had effectively set aside the District Court's costs order. The court also considered the application of rule 20.26 of the Uniform Civil Procedure Rules 2005 (NSW) in the context of an early "walk away" offer where no evidence of costs incurred by the offeror was presented.

The Court of Appeal reasoned that the respondents' offer of compromise was not sufficiently explained, particularly in relation to their position on costs. The court noted that the offer was an early "walk away" offer and that there was no evidence presented to demonstrate the costs incurred by the respondents. Without this information, the court could not be satisfied that the offer was a genuine compromise or that the appeal was doomed to fail. Consequently, the court found no basis to revoke the costs order made on 8 July 2019, which had reinstated the District Court's costs order.

The Court of Appeal ordered that the orders made on 8 July 2019 be varied by revoking order (2)(d), with the intention that the District Court's order of 30 July 2018 would continue to operate. The applicants' notice of motion filed on 18 July 2019 was otherwise dismissed, and the applicants were ordered to pay the appellant's costs of the motion.