NEW SOUTH WALES COURT OF APPEAL
CITATION: Ghunaim v Bart [No 2] [2006] NSWCA 82
FILE NUMBER(S):
41024/02
HEARING DATE(S): On the papers.
DECISION DATE: 24/04/2006
PARTIES:
Ali Ghunaim (Appellant)
Wilhelm Bart (Respondent)
JUDGMENT OF: Giles JA Ipp JA McColl JA
LOWER COURT JURISDICTION: District Court
LOWER COURT FILE NUMBER(S): DC 1275/01
LOWER COURT JUDICIAL OFFICER: Rein SC DCJ
COUNSEL:
SOLICITORS:
Appellant unrepresented
Sparke Helmore (Respondent)
CATCHWORDS:
COSTS - TRIAL - Calderbank offer more favourable for appellant than ultimate outcome - Offer submitted on morning of first day of trial and open for acceptance for 2-3 hours - Whether appellant acted unreasonably in rejecting offer - HELD - No
LEGISLATION CITED:
District Court Act 1973
Workers Compensation Further Amendment Act 2001
District Court Rules 1973
DECISION:
1. Set aside the costs orders made by Rein DCJ on 17 October 2002. 2. Order the respondent to pay the appellant’s costs of the trial. 3.Direct the respondent to inform the appellant by letter sent to his last known address of this judgment and orders.
JUDGMENT:
- 1 -
IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL
CA 41024/02
DC 1275/01GILES JA
IPP JA
McCOLL JAMonday 24 April 2006
GHUNAIM v BART [No 2]
Judgment
GILES JA: I agree with McColl JA.
IPP JA: I agree with McColl JA.
McCOLL JA: The Court delivered judgment in this matter on 24 February 2004: Ghunaim v Bart [2004] NSWCA 28.
The appeal was allowed to the extent that the appellant challenged the trial judge’s finding that he had been guilty of contributory negligence. The effect of allowing that part of the appeal was to increase the verdict Rein DCJ had entered in the appellant’s favour from $262,533.21 to $308,862.03 net of workers compensation payments. The parties were given liberty to apply on two days notice in respect of the calculation of the verdict and judgment, such liberty to be exercised no later than fourteen days after its date.
Although solicitors for both parties originally sought to exercise that liberty within the time limited, those attempts foundered – at least in the short term. Difficulties undoubtedly stemmed from the fact that the appellant appears to have changed his solicitors after the appeal was heard and on 13 July 2005 the solicitor who had acted for him on the appeal filed a notice of ceasing to act. No new solicitors have filed a notice of appearance on his behalf.
Pursuant to the original exercise of liberty to apply, the respondent seeks to have the order for costs of the trial made by Rein DCJ varied on the basis of a Calderbank offer which was more favourable than the amount awarded to the appellant.
According to an affidavit of service sworn by Terence Brightman, the appellant has been served with the papers the Court is asked to consider. He wrote to the Registrar seeking an extension of time to respond and saying he was obtaining a solicitor. A firm of solicitors apparently…
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- AGLC
- Ghunaim v Bart (No 2) [2006] NSWCA 82
- Case
- [2006] NSWCA 82
- Decision Date
CaseChat Overview and Summary
The primary legal issue before the court was whether the appellant had acted unreasonably in rejecting the respondent's offer of compromise, thereby justifying an award of indemnity costs against the appellant for the period after the offer was made. The court was required to consider the discretion to award indemnity costs following an unaccepted Calderbank offer, taking into account all the circumstances of the case, including the strengths and weaknesses of each party's position at the time the offer was made.
The court reasoned that the discretion to award indemnity costs following an unaccepted Calderbank offer should be exercised in accordance with the principles applicable to offers of compromise under the District Court Rules. Specifically, a defendant seeking indemnity costs must demonstrate that the plaintiff's rejection of the offer was unreasonable. The court noted that indemnity costs do not automatically follow from an unaccepted offer and that the authorities emphasize the width of the discretion and the unusual nature of awarding indemnity costs in relation to Calderbank letters. The court also considered the relevant District Court Rules regarding offers of compromise, including the minimum period for which such offers must remain open and the consequences of an unaccepted offer made during trial.
The court ordered that the costs orders made by Rein DCJ on 17 October 2002 be set aside. The respondent was ordered to pay the appellant's costs of the trial. The respondent was also directed to inform the appellant of the judgment and orders by letter to his last known address.
Orders
Orders of the court
1. Set aside the costs orders made by Rein DCJ on 17 October 2002. 2. Order the respondent to pay the appellant’s costs of the trial. 3.Direct the respondent to inform the appellant by letter sent to his last known address of this judgment and orders.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
The respondent submits that the appropriate costs orders for the costs of the trial consequent upon this Court’s decision is:1.Set aside the costs order made by the trial judge on 17 October 2002;2. In lieu thereof order:(i) the respondent to pay the appellant’s costs on a party/party basis until 11 June 2002; (ii) the appellant to pay the respondent’s costs of the notice of motion of 12 December 2001 and the costs of the vacated arbitration date of 14 December 2001;(iii) the appellant to pay the respondent’s costs on an indemnity basis from 11 June 2002.Consideration The discretion to award the respondent costs of the trial (whether on an indemnity basis or otherwise) following the Calderbank offer turns on all the circumstances of the case, including the relevant strengths and weaknesses of each party’s case as they may have been apparent at the time the offer was made: South Eastern Sydney Area Health Service v King [2006] NSWCA 2 at [90] per Hunt AJA, with whom Mason P and I agreed. In Leichhardt Municipal Council v Green [2004] NSWCA 341 at [46], Santow JA (with whom Bryson and Stein JJA agreed) said that the considerations which applied when determining whether, pursuant to the District Court Rules, a defendant should be awarded indemnity costs for an unaccepted offer of compromise, should also apply when determining whether a defendant should be awarded indemnity costs for an unaccepted Calderbank offer. His Honour said (at [46]) applying Multicon Engineering Pty Ltd v Federal Airports Corp (1996) 138 ALR 425, that a defendant must show that the plaintiff’s rejection of the offer was “unreasonable” under the general law. The Court’s discretion was to be exercised in all the circumstances of the case and “[i]ndemnity costs do not flow as a matter of course from unaccepted defendant offers”. He noted (at [47]) that “the authorities emphasise the width of the discretion and the unusual nature of an award of indemnity costs in relation to Calderbank letters.” At the time of the trial the District Court Rules relating to Offers of Compromise enabled such an offer to be made, relevantly, at any time prior to the trial judge giving, or beginning to give, his reasons for his decision on a judgment: DCR Pt 19A r 3(1), (8). An Offer of Compromise had to be open for acceptance for at least 28 days after it was made: DCR Pt 19A r 3(3). Where an offer was made by a defendant and not accepted by the plaintiff and the plaintiff obtained an order or judgment on the claim to which the offer related not more favourable to him than the offer, the plaintiff was entitled to an order for costs against the defendant up to and including the day the offer was made assessed on a party and party basis, and the defendant was entitled to an order against the plaintiff for the defendant’s costs in respect of the claim thereafter assessed on a party and party basis: DCR Pt 39A r 25(6). For the purpose of the latter sub-rule, where the defendant’s offer was made on the first or a later day of the trial of the proceedings then, unless the court otherwise ordered, the plaintiff was entitled to costs in respect of the claim up to 11am on the day following the day on which the offer was made, assessed on a party and party basis, and the defendant was entitled to costs in respect of the claim thereafter assessed on a party and party basis: DCR Pt 39A r 25(7).