Giuseppe Bonifacio v NSW Trustee and Guardian acting as executor of the Estate of the late Adam Frank Woitala (No.2)

[2015] NSWSC 220

Supreme Court

New South Wales

Medium Neutral Citation:	Giuseppe Bonifacio v NSW Trustee and Guardian acting as executor of the Estate of the late Adam Frank Woitala (No.2) [2015] NSWSC 220
Hearing dates:	On the papers
Date of orders:	13 March 2015
Decision date:	13 March 2015
Jurisdiction:	Equity Division
Before:	Darke J
Decision:	Consequential orders made, including an order for indemnity costs.
Catchwords:	COSTS – indemnity costs – Calderbank offer not accepted by unsuccessful plaintiffs – whether unreasonable of plaintiffs to not accept offer
Cases Cited:	Giuseppe Bonifacio v NSW Trustee and Guardian acting as executor of the Estate of the late Adam Frank Woitala [2015] NSWSC 124
Category:	Costs
Parties:	Giuseppe Bonifacio (first plaintiff) Eva Bonifacio (second plaintiff) NSW Trustee and Guardian acting as executor of the Estate of the late Adam Frank Woitala (first defendant) Registrar-General of NSW (second defendant)
File Number(s):	2013/377112
Publication restriction:	Nil.

Judgment

Introduction

1. On 27 February 2015, the parties were directed to bring in short minutes to reflect the reasons for judgment published on that day (Giuseppe Bonifacio v NSW Trustee and Guardian acting as executor of the Estate of the late Adam Frank Woitala [2015] NSWSC 124 at [66]). The Court has received draft Short Minutes prepared by Mr Lovas, Counsel for the plaintiffs. Mr Thomson, Counsel for the first defendant, agrees that they are appropriate, save in respect of proposed order 4 which concerns costs.

2. The first defendant seeks an order that the plaintiffs pay its costs after 14 November 2014 on an indemnity basis due to the failure of the plaintiffs to accept a Calderbank Offer made to them on that date.

3. The plaintiffs accept that they should pay the first defendant's costs of the proceedings, but resist the indemnity costs order sought.

4. The Calderbank Offer was to the effect that the first defendant would pay the plaintiffs $20,000 inclusive of costs and in settlement of all claims, such amount to be paid out of the proceeds of a sale of the Ryde property the subject of the dispute. The offer was expressed to be open for acceptance until 16 December 2014. There is no evidence of the plaintiffs making any response to the offer.

5. The offer was accompanied by an explanation as to why the plaintiffs' claim was doomed to fail. This was that the claim was barred by ss 27(2) and 47 of the Limitation Act 1969 (NSW). The Court ultimately concluded that the plaintiffs' action was so barred.

6. Mr Lovas submitted that the offer, made after the case had been allocated a hearing date, did not contain any genuine element of compromise and was not a genuine inducement to settle. He submitted that it was, at best, an offer to contribute to only some of the costs the plaintiffs had by then incurred, in the context of a claim for property worth several hundreds of thousands of dollars. Further, it was submitted that whilst the offer stressed the Limitation Act defence, it did not deal with the legal and factual questions raised in the case concerning s 38 of that Act. Mr Lovas submitted that in all the circumstances, including the underlying fraud and its consequences, the appropriate order would be one made on the ordinary basis.

7. In my view, the offer, whilst modest, ought be regarded as one involving a genuine compromise. It was made at a time after the parties would have incurred quite significant costs. The first defendant was offering to give up any claim for its own costs, and make a payment of $20,000 to the plaintiffs. The modest element of compromise no doubt reflected the first defendant's perception (justified as it turned out) of the strength of its Limitation Act defence. It is true that the offer was not accompanied by an analysis of the issues ultimately raised by the plaintiffs concerning s 38 of the Limitation Act. However, the plaintiffs were in a position to make an assessment of those issues. Insofar as they concerned factual matters, these were known to the plaintiffs to a greater extent than they were known to the first defendant. In my opinion, viewing the matter objectively, it was unreasonable of the plaintiffs to not accept the offer made to them.

8. In all the circumstances, it seems to me that it is appropriate to depart from the usual position and instead make an order for costs as submitted by Mr Thomson, namely, that the plaintiffs pay the first defendant's costs of the proceedings on the ordinary basis up to 14 November 2014 and on an indemnity basis thereafter.

9. The Court will make that order, along with orders in accordance with paragraphs 1, 2 and 3 of the draft Short Minutes.

10. Accordingly, the Court makes the following orders:

1. The Amended Statement of Claim is dismissed.

2. Direct the plaintiffs, by themselves or their agent, to deliver:

1. the Certificate of Title to the land described as Lot 1 in Deposited Plan 10373; and

2. a signed Withdrawal of Caveat in registrable form in respect of registered caveat numbered AH266216,

to the first defendant's solicitor within 14 days.

3. Direct the first defendant's solicitor to provide the plaintiffs or their agent a receipt for the delivery of the said Certificate of Title and Withdrawal of Caveat upon their respective delivery.

4. Order that the plaintiffs pay the first defendant's costs of the proceedings on the ordinary basis up to 14 November 2014 and on an indemnity basis thereafter.

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