Enkelmann v Stewart (No. 3)

The case of Enkelmann v Stewart (No. 3) involves a dispute between the plaintiffs, who are neighbours, and the defendants, regarding the existence and impact of levees allegedly built by the defendants. The plaintiffs claimed that the levees disrupted the flow of water on their farm, but the court found that the levees did not and had never existed. The plaintiffs' allegations could not be established, and there was no credible evidence to support their claims. The court found that the plaintiffs commenced and continued the proceedings without reasonable basis and in wilful disregard of facts that should have been known to them. The defendants were successful on their counterclaim.

The court considered whether it was appropriate to exercise its discretion to award costs on an indemnity basis, given the plaintiffs' lack of reasonable basis for their claims and their failure to accept formal and informal offers to settle. The court found that the defendants' formal offer, made six weeks before trial, included a degree of compromise and that the defendants' prospects of success were strong. The plaintiffs' rejection of the formal and Calderbank offers was unreasonable and justified a departure from the general costs rule. The court concluded that the plaintiffs should pay the defendants' costs of the claim and counterclaim on an indemnity basis, and the defendants' costs of the Final Orders on the standard basis.

The final orders of the court were that the plaintiffs pay the defendants' costs of the plaintiffs' claim and counterclaim on the indemnity basis, and the defendants' costs of the Final Orders on the standard basis. The court's decision highlights the importance of ensuring that legal proceedings are commenced and continued with reasonable basis and in good faith, and the consequences of failing to do so.