Corbett v Nguyen (No 2)

In the matter of Corbett v Nguyen (No 2), the plaintiff sought to recover costs from the defendant in relation to a cross-claim that was dismissed due to the plaintiff's primary claim failing. The matter was heard in the Supreme Court of New South Wales. The central dispute revolved around the circumstances under which the plaintiff could be awarded costs in relation to the dismissed cross-claim and whether there was a basis for setting off costs against each other and against the judgment.

The court was required to determine whether the plaintiff was entitled to costs of the cross-claim and if there were any grounds for setting off these costs against the costs of the defendant's appeal and against the judgment in the primary proceedings. The key legal issues centred on the applicability of the usual costs-following-the-event rule and whether exceptional circumstances warranted a different outcome.

The court held that the plaintiff was not entitled to costs of the dismissed cross-claim because the usual rule that costs follow the event did not apply in this instance. The dismissal of the cross-claim did not constitute an event in favour of the defendant that would justify awarding costs to the defendant. Additionally, the court found that there were no exceptional circumstances that would warrant setting off costs against each other and against the judgment. The reasoning was based on the principle that the costs incurred by the plaintiff in pursuing the cross-claim did not result in a benefit to the defendant that would entitle the defendant to a costs order.

Consequently, the court dismissed the plaintiff's application for costs in relation to the dismissed cross-claim and ruled against setting off costs in the manner sought by the plaintiff. The court's decision was grounded in the well-established legal principles governing costs in civil litigation, particularly the rule that costs generally follow the event and the limited circumstances under which costs may be set off.