Chan v Acres (No 3)

Chan and others initiated legal action against Acres and others, contending that Acres had breached their fiduciary duties by misusing confidential information and engaging in unfair competition. The case was heard in the Supreme Court of New South Wales. The primary legal issues the court addressed were the appropriateness of awarding indemnity costs in a scenario where the plaintiffs and defendants had varying degrees of success at trial, the conditions under which a Calderbank offer should be accepted, the criteria for ordering costs under UCPR r 42.15A, and whether a Bullock or Sanderson order should be applied. The court concluded that indemnity costs should not be awarded due to the absence of a clear demonstration by the offeror that it was unreasonable for the offeree not to accept the offer. Regarding the orders of compromise, the court found that the plaintiffs had not established that it was unreasonable for the defendants not to accept their offers, nor did the plaintiffs prove that the defendants' offers were unreasonable. Consequently, the court ruled against making a Bullock or Sanderson order and declined to create a carve-out for specific costs.

The court further examined the application of UCPR r 42.15A, determining that the plaintiffs had not met the burden of proof required to warrant an order for costs. The court emphasised that the plaintiffs had to demonstrate that the defendants' conduct was unreasonable, which they failed to do. As a result, the court dismissed the plaintiffs' application for costs under UCPR r 42.15A. The final orders of the court were that indemnity costs should not be awarded, no Bullock or Sanderson order should be made, and no carve-out of particular costs should be applied. The plaintiffs were also ordered to pay the defendants' costs of the application.