De Gruchy v The Owners Units Plan No. 3989 (No. 2)

The applicants, De Gruchy, sought costs from the defendants, the owners of Units Plan No. 3989, after the defendants had settled a dispute with other parties involved in the litigation. The dispute involved a complex dispute regarding the administration of a unit title scheme, and the case was heard in the Federal Circuit Court of Australia. The applicants argued that the settlement reached by the defendants was a genuine offer of compromise and that they were entitled to costs under the Court Procedure Rules 2006 (ACT). The court was required to determine whether the offer made by the defendants was a genuine offer of compromise, whether the orders made were no less favourable than the offer, whether the offer was a valid Calderbank offer, and whether it was unreasonable to reject the offer.

The court found that the offer made by the defendants was a genuine offer of compromise as it was made in good faith and without any ulterior motives. The court also found that the orders made were no less favourable than the offer as they provided the applicants with a similar outcome to that which they would have received had the offer been accepted. The court further found that the offer was a valid Calderbank offer as it was made without any admission of liability or wrongdoing, and that it was unreasonable for the applicants to reject the offer. The court held that the applicants were entitled to costs under the Court Procedure Rules 2006 (ACT) as the defendants had made a genuine offer of compromise that was reasonable and which the applicants had unreasonably rejected.

The court ordered that the applicants were entitled to costs of the proceedings in the sum of $25,000, to be paid by the defendants within 28 days of the date of the judgment. The court also ordered that if the defendants failed to pay the costs within the specified time, the applicants could apply to the court for an order for payment of the costs out of the defendants’ property.