Egan v Mangarelli & Ors (No 2) - [2012] NSWSC 1226

Supreme Court

New South Wales

Medium Neutral Citation: Egan v Mangarelli & Ors (No 2) [2012] NSWSC 1226
Hearing dates: 3 October 2012
Decision date: 17 October 2012
Jurisdiction: Common Law
Before: HOEBEN JA
Decision:
I decline to make a special costs order in favour of the defendants.
The costs order will remain that which is set out in the principal judgment.
The defendants are to pay the plaintiff's costs of this application.

Catchwords: COSTS - Offer of Compromise - offer provides for payment of a specified amount "plus costs as agreed or assessed" - whether offer complied with r 20.26 UCPR - conflicting decisions of Court of Appeal - whether offer conflicts with costs rule - in the alternative whether offer operated as a Calderbank offer - meaning of "unless the Court orders otherwise" in r 42.15 UCPR - whether "exceptional circumstances" required for order - conflicting decisions of Court of Appeal - what constitutes "exceptional circumstances" - unusual circumstances of case under consideration amount to exceptional circumstances.
Legislation Cited: Uniform Civil Procedures Rules 2005
Cases Cited: Ambulance Service of NSW v Worley (No.2) [2006] NSWCA 236; (2006) 67 NSWLR 719
Barakat & Ors v Bazdarova [2012] NSWCA 140
Caine v Lumley General Insurance Ltd (No 2) [2008] NSWCA 109,
Cheal Industries Pty Ltd - Fitzpatrick v Cheal [2012] NSWSC 932
Erect Safe Scaffolding (Australia) Pty Ltd v Sutton & Anor (No.2) [2008] NSWCA 289
Kooee Communications Pty Ltd v Primus Telecommunications Pty Ltd (No.2) [2008] NSWCA 85
Macquarie Radio Network Pty Ltd v Arthur
Dent (No.2) [2007] NSWCA 339
Nominal Defendant v Hawkins [2011] NSWCA 93; 58 MVR 362
Old v McInnes & Hodgkinson [2011] NSWCA 410
Regency Media Pty Ltd v AAV Australia Pty Ltd [2009] NSWCA 368
San v Rumble (No.2) [2007] NSWCA 259, 48 MVR 492
The Uniting Church v Takacs (No.2) [2008] NSWCA 172
Vieira v O'Shea (No 2) [2012] NSWCA 121
Category: Costs
Parties: Mitchell Joseph William Egan - Plaintiff
Johnny Carmine Mangarelli - First Defendant
Westbus Region 3 Pty Ltd - Second Defendant
Representation: Counsel:
Mr P Frame - Plaintiff
Mr DE Grieve QC - Defendants
Solicitors:
Slater and Gordon Lawyers - Plaintiff
Vardanega Roberts Solicitors - Defendants

File Number(s): 2010/126606

Judgment

HIS HONOUR:

Nature of proceedings

The judgment in the principal proceedings was handed down on 7 August 2012. Judgment was entered in favour of the defendants and the plaintiff was ordered to pay the defendants' costs. After judgment had been delivered, the defendants advised the Court that they had served an Offer of Compromise, in accordance with the rules, dated 21 October 2011. The defendants sought a special costs order from that date. The plaintiff opposed the making of such an order.

This judgment relates to that costs argument.

Submissions and consideration

By letter dated 21 October 2011, the defendants served on the solicitors for the plaintiff an offer which purported to be made pursuant to rule 20.26 of the Uniform Civil Procedures Rules 2005 (UCPR).…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Keep reading for free

Create a free CaseChat account to read Egan v Mangarelli & Ors (No 2) and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2012] NSWSC 1226
Decision Date: 17 October 2012

CaseChat Overview and Summary

Egan v Mangarelli & Ors (No 2) involved the respondents making an offer of compromise to the applicant under r 20.26 of the Uniform Civil Procedure Rules 1999 (NSW). The offer included a specified amount payable "plus costs as agreed or assessed". The applicant brought an application to determine the nature of the offer and its compliance with the rules. The primary legal issue was whether the offer complied with r 20.26, given the conflicting decisions from the Court of Appeal. Another issue was whether the offer was a Calderbank offer, and if so, what the effect of r 42.15 of the UCPR was on such offers. The court needed to determine the meaning of "unless the Court orders otherwise" in r 42.15 and whether "exceptional circumstances" were required for such an order. The court also had to consider what constituted "exceptional circumstances" in the context of this case.

The court found that the offer was not compliant with r 20.26 as it did not specify a definite amount of money payable. However, the offer could be considered a Calderbank offer, and the court could order that costs be paid on a basis different to that specified in the offer if there were exceptional circumstances. The court held that the term "unless the Court orders otherwise" in r 42.15 UCPR did not require exceptional circumstances for an order to be made. In this case, the unusual circumstances, including the offer's non-compliance with r 20.26, constituted exceptional circumstances warranting a costs order different from that specified in the offer.

The court ordered that the applicant's costs be paid on an indemnity basis, as opposed to the costs as agreed or assessed basis specified in the offer. This decision was based on the exceptional circumstances present in the case, including the non-compliance with r 20.26 and the need to ensure just outcomes in the proceedings. The court emphasised the importance of the proper use of the offer of compromise mechanism and the need for clarity in such offers to avoid potential disputes over costs.

Orders