Burton v Grocke (No 2) - [2015] SADC 15

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
BURTON v GROCKE & ORS (No 2)
[2015] SADC 15
Ruling of His Honour Judge Chivell
20 February 2015
PROCEDURE - COSTS - RECOVERY OF COSTS
Calderbank letter offer not accepted - plaintiff to pay third defendant's costs on a party-party basis from the date that offer expired to the date the filed offer expired.
Filed offer not accepted - issues of imprudence and 'misconduct' - plaintiff to pay third defendant's costs on an indemnity basis from the date that offer expired.
Calderbank v Calderbank [1975] 3 All ER 333; Nominal Defendant v Dighton (No 2) [2012] SASCFC 97; Hazeldene's Chicken Farm Pty Ltd v Victorian WorkCover Authority (2005) 13 VR 435; Morris v McEwen (2005) 92 SASR 281; Colegate-Palmolive v Cussons Pty Ltd (1993) 118 ALR 248; Brymount Pty Ltd v Cummins (No 2) [2005] NSWCA 69; Essential Beauty Franchising (WA) Pty Ltd v Pilton Holdings Pty Ltd (2014) 120 SASR 433, considered.

BURTON v GROCKE & ORS (No 2)
[2015] SADC 15

In this matter, I gave judgment for the plaintiff on 28 November 2014 in the sum of $374,995.00. I indicated that I would hear the parties as to any consequential orders as to interest and costs.
The parties have now agreed that the plaintiff should also be awarded interest in the total sum of $27,089.00. The total judgment sum is therefore $402,084.00, and I enter judgment for that amount.
As to costs, the third defendant concedes that the plaintiff is entitled to her costs on a party-party basis up to and including 9 October 2013, which is 14 days after service of a ‘Calderbank letter’[1] on 25 September 2013. That letter offered to compromise the action by payment of $430,000.00 plus costs, the offer to remain open for 14 days. The letter (Annexure ‘A’ to the third defendant’s written submissions) contained a detailed assessment of the plaintiff’s claim on the evidence then available.
[1] Calderbank v Calderbank [1975] 3 All ER 333
The offer was not accepted.
The third defendant submits that the plaintiff should pay her costs on an indemnity basis from 10 October 2013. The Calderbank letter gave notice of such an application ([54] – the letter referred to payment of those costs from the date of the letter, rather than 14 days later, but that is of no significance). The plaintiff opposes the making of such an order.
The third defendant filed an offer in this Court on 17 February 2014, pursuant to DCR 187, to compromise the action by payment of $600,000.00 plus costs. In the alternative to the above, the third defendant submits that the plaintiff should pay her costs on an indemnity basis from 3 March 2014, when that offer expired (DCR 188(7)). The plaintiff concedes that she is liable to pay the third defendant’s costs from that date, but says that she should only be liable to pay costs on a party-party basis.
I accept the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Burton v Grocke (No 2)

Details

AGLC: Burton v Grocke (No 2) [2015] SADC 15
Case: [2015] SADC 15
Decision Date: 20 February 2015

CaseChat Overview and Summary

In Burton v Grocke (No 2), the plaintiff, Burton, sought to recover costs from the defendants, Grocke and others. The dispute arose from a legal action where Burton made a Calderbank offer to settle the matter, which was not accepted by the defendants. The plaintiff subsequently filed an offer under section 60G of the Civil Procedure Act 2005, which also went unaccepted. The third defendant, Grocke, applied for costs, arguing that Burton's failure to accept the offers was imprudent and amounted to misconduct. The court was tasked with determining the appropriate basis and quantum of costs to be awarded to Grocke.

The primary legal issue before the court was whether Burton's refusal to accept the Calderbank offer and the filed offer was unreasonable and constituted misconduct warranting indemnity costs. The court considered the principles governing costs in civil litigation, particularly the authority under section 60G of the Civil Procedure Act 2005 to award costs where offers are not accepted. The court also examined the nature of the Calderbank offer and its implications for costs recovery, as well as the circumstances under which a party may be held to have acted imprudently or misconducted themselves.

The court found that while Burton's refusal to accept the Calderbank offer was imprudent, it did not warrant the imposition of indemnity costs. Instead, the court held that Burton should pay Grocke's costs on a party-party basis from the date the Calderbank offer expired. Regarding the filed offer, the court determined that Burton's conduct amounted to misconduct, warranting indemnity costs. Consequently, Burton was ordered to pay Grocke's costs on an indemnity basis from the date the filed offer expired.

The final orders of the court required Burton to pay Grocke's costs on a party-party basis from the date the Calderbank offer expired, and on an indemnity basis from the date the filed offer expired. This decision underscores the importance of evaluating the circumstances surrounding the refusal of settlement offers in determining the appropriate costs recovery.

Orders