Cong v Shen (No 4)

In Cong v Shen, the matter came before the Federal Court of Australia. The dispute involved an application to amend, vary and set aside an earlier judgment between the parties. The application was brought pursuant to the slip rule to correct a clerical error in the earlier judgment. The primary legal issues were whether the application should be allowed, and if so, the appropriate costs order. Specifically, the court needed to decide whether the general rule that costs follow the event applied, and whether any exceptions to this rule, such as an offer of compromise, should be considered.

The court considered that the slip rule is an exception to the general rule that costs follow the event. It is intended to facilitate the correction of clerical errors in judgments. In this instance, the error was clerical, and there was no dispute that the error was not attributable to any fault of the party seeking to correct it. The court also considered the nature of offers of compromise, noting that they are generally made in the context of a potential settlement of the litigation and are not intended to influence the costs outcome in the absence of settlement. Given the nature of the application and the absence of any offer of compromise in the traditional sense, the court concluded that the general rule applied, and the party who had prevailed in the original proceedings was entitled to costs.

In light of the above, the court dismissed the application to amend, vary and set aside the earlier judgment. It ordered that the successful party, Cong, recover costs from Shen on an indemnity basis. The court found that the application was an abuse of process, given the nature of the error and the lack of any legitimate basis to argue otherwise. The court further held that there was no need to consider any offers of compromise, as the application did not involve any compromise or settlement discussions.

The final orders were that the application to amend, vary and set aside the earlier judgment be dismissed, and that Cong recover costs from Shen on an indemnity basis.