Caruso v Newington Road Developments Pty Ltd (No 2) - [2024] ACTSC 108

SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Case Title:	Caruso v Newington Road Developments Pty Ltd (No 2)
Citation:	[2024] ACTSC 108
Hearing Date:	Decided on the papers
Decision Date:	12 April 2024
Before:	Taylor J
Decision:	(1) The plaintiff is to pay the defendant’s costs on a party and party basis up to 15 March 2023, and thereafter on a solicitor and client basis.
Catchwords:	CIVIL LAW – PRACTICE AND PROCEDURE – Costs – Calderbank offer – whether offer was a genuine offer – whether it was unreasonable to reject the offer – where plaintiff rejected offer to settle
Legislation Cited:	Court Procedures Rules 2006 (ACT), rr 1751, 1752
Cases Cited:	Calderbank v Calderbank [1975] 3 All ER 333 Caruso v Newington Road Developments Pty Ltd [2024] ACTSC 22 Hulanicki v Walton (No 2) [2015] ACTCA 45 Financial Integrity Group Pty Ltd v Farmer (No 5) [2014] ACTSC 194 Financial Integrity Pty Ltd v Farmer (No 4) [2014] ACTSC 145 Leichhardt Municipal Council v Green [2004] NSWCA 341 Monie v Commonwealth of Australia (No 2) [2008] NSWCA 15 Oshlack v Richmond River Council [1998] HCA 11; 193 CLR 72 Pires v DibbsBarker Canberra Pty Limited [2014] ACTSC 283 Ross v Gordon (No 2) [2023] ACTCA 40 Southwell v Staite (No 2) [2019] ACTSC 83 Subasic v Hewlett-Packard Pty Ltd (No 2) [2020] ACTSC 195
Parties:	Frank Caruso ( Plaintiff) Newington Road Developments Pty Ltd (ACN 646 345 002) ( Defendant)
Representation:	Counsel R Montagnino ( Plaintiff) J A Larkings ( Defendant)
Solicitors United Legal ( Plaintiff) Lexmerca ( Defendant)
File Number:	SC 361 of 2022

TAYLOR J:

Introduction

1․The defendant applies to vary a costs order arising from a judgment delivered entirely in his favour on 8 February 2024: Caruso v Newington Road Developments Pty Ltd [2024] ACTSC 22 (Caruso). Order (3) required the plaintiff to pay the costs of the defendant. The parties were given the opportunity to seek a variation of the costs order.
2․The defendant subsequently applied to the Court for such a variation. The defendant seeks a more favourable costs order requiring the plaintiff to pay its costs, assessed on a party and party basis up to 15 March 2023, and thereafter on a solicitor and client basis. The plaintiff opposes the variation to the costs order.
3․For the reasons that follow, the varied order as sought by the defendant should be made.

Background

4․The background to the proceedings is set out in my judgment in Caruso at [15]. In summary, the plaintiff claimed damages for breach of contract. The contract said to have been formed between the parties was a “collateral contract”. The plaintiff relied on an email sent to him in November 2021 by the defendant’s real estate agent accepting an offer he had made on a lot of land (Lot 10) the defendant company was to develop. The email was said to be the “collateral contract”. Lot 10 was later sold to another buyer. The plaintiff sought the difference…

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.

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Details

Case: [2024] ACTSC 108
Decision Date: 12 April 2024

CaseChat Overview and Summary

Caruso sued Newington Road Developments over a dispute concerning a property development. The case was heard in the Supreme Court of New South Wales. The central issue before the court was whether the plaintiff's rejection of the defendant's offer to settle the case was reasonable, and whether the defendant's costs should be awarded against the plaintiff. The defendant made a Calderbank offer to settle the dispute, which the plaintiff rejected. The court had to determine if the offer was a genuine one and whether it was reasonable for the plaintiff to reject it.

The court found that the defendant's offer was genuine and not a sham. It was also not unreasonable for the plaintiff to reject the offer. The court noted that the plaintiff had a reasonable basis for rejecting the offer, given the potential damages that could have been awarded. The court held that the plaintiff's rejection of the offer did not automatically make them liable for the defendant's costs. However, the court did award the defendant's costs against the plaintiff, given the circumstances of the case.

The court ordered that the plaintiff pay the defendant's costs on a party and party basis up to 15 March 2023, and thereafter on a solicitor and client basis. The court found that the plaintiff's conduct in rejecting the offer was not entirely without merit, but it was still unreasonable to reject such a significant offer without proper consideration. The court's decision highlights the importance of considering settlement offers carefully and the potential consequences of rejecting them without good reason.

Orders

Orders of the court

(1) The plaintiff is to pay the defendant’s costs on a party and party basis up to 15 March 2023, and thereafter on a solicitor and client basis.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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