Curtis v Harden Shire Council (No 2)

The proceedings concerned an application for indemnity costs following an appeal in *Curtis v Harden Shire Council*. The appellant, Mr Curtis, sought to amend an earlier costs order made by the Court of Appeal, arguing that his refusal of an offer of compromise made by the respondent, Harden Shire Council, was unreasonable, thereby entitling him to indemnity costs from the date of that offer.

The central legal issues before the Court of Appeal were whether an offer of compromise that included the phrase "costs as agreed or assessed" complied with rule 20.26 of the Uniform Civil Procedure Rules 2005 (NSW), and if not, whether such a non-compliant offer could still be treated as a *Calderbank* offer, allowing the court to exercise its discretion under section 98 of the *Civil Procedure Act 2005* (NSW) and rule 42.2 of the Uniform Civil Procedure Rules 2005 (NSW) to award indemnity costs. The court also had to determine if the offer was genuine and if the refusal of the offer was reasonable in the circumstances.

Bathurst CJ, Beazley P and Basten JA held that an offer of compromise which includes the phrase "costs as agreed or assessed" does not comply with rule 20.26 of the Uniform Civil Procedure Rules 2005 (NSW). However, they found that such an offer could still be considered a *Calderbank* offer. Applying the principles established in *Calderbank v Calderbank*, the court determined that the respondent's offer, although not compliant with the rules for a formal offer of compromise, was genuine and that the appellant's refusal of it was unreasonable. Consequently, the court amended the previous costs order to reflect that the respondent should pay the appellant's costs of the appeal on the ordinary basis up to 24 September 2013, and on an indemnity basis from that date onwards. The notice of motion was otherwise dismissed without costs.