Hastie v Hastie (No. 2)

[2025] QSC 237

SUPREME COURT OF QUEENSLAND

CITATION:

Hastie & anor v Hastie & anor (No. 2) [2025] QSC 237

PARTIES:

ALLAN HASTIE

(first plaintiff)
and
JEANETTE FAY HASTIE
(second plaintiff)

v
CRAIG ANDREW HASTIE

(first defendant)
and
KYLIE ELIZABETH HASTIE

(second defendant)

FILE NO/S:

BS No 9844 of 2024

DIVISION:

Trial Division

PROCEEDING:

Trial

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

26 September 2025

DELIVERED AT:

Brisbane

HEARING DATE:

On the papers

JUDGE:

Williams J

ORDER:

The plaintiffs pay the defendants’ costs on the standard basis.

CATCHWORDS:

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – OFFERS OF COMPROMISE, PAYMENTS INTO COURT AND SETTLEMENTS – INFORMAL OFFERS AND CALDERBANK LETTERS – GENERALLY – where the plaintiffs’ claim was dismissed – where the defendants’ relied on the plaintiffs’ rejection of two Calderbank offers in support of their submission for the award of indemnity costs – where the Calderbank offers did not articulate why non-acceptance would be unreasonable – where the offers were conditional on the execution of a deed of settlement that had not yet been drafted – whether the plaintiffs’ rejection of the Calderbank offers was unreasonable and justifies a departure from the general costs rule

Uniform Civil Procedure Rules 1999, r 681, r 702

Calderbank v Calderbank [1975] 3 All ER 333, cited
Colgate Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225; [1993] FCA 536, cited
Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) (2005) 13 VR 435; [2005] VSCA 298, cited
Lawrence v Ciantar (No 2) [2019] NSWSC 722, cited

McGee v Independent Assessor & Anor [No 2] [2024] QCA 7, cited

COUNSEL:

M G Larsen for the plaintiffs

A M Laylee for the defendants

SOLICITORS:

De Brenni & Co for the plaintiffs
ACS Legal Solutions for the defendants

1. On 28 August 2025 the plaintiffs’ claim was dismissed, the parties were directed to file and serve written submissions in respect of costs of not more than 3 pages, and reasons were published (Reasons).[1] 

   [1]Hastie & anor v Hastie & anor [2025] QSC 190.

2. These reasons deal with the issue of costs. The defined terms in the Reasons are used in these reasons, unless stated to the contrary.

3. The plaintiffs contend that the appropriate order is that the plaintiffs pay the defendants’ costs on the standard basis. 

4. The defendants contend that the appropriate order is:

   (a)The plaintiffs pay the defendants’ costs up to 4 pm on 27 November 2024 on the standard basis.

   (b)The plaintiffs pay the defendants’ costs after 4 pm on 27 November 2024 on the indemnity basis.

5. The defendants rely on two Calderbank offers[2] that were not accepted by the plaintiffs in support of their submission for the Court to exercise the discretion to award part indemnity costs.

   [2]Offers made in accordance with the principles outlined in Calderbank v Calderbank [1975] 2 All ER 333.

6. Accordingly, it is not contentious between the parties that the plaintiffs should be ordered to pay the defendants’ costs on the standard basis.  The issues to be determined are:

   (a)Whether the Court should exercise its discretion to award indemnity costs from the expiry of the Calderbank offer dated 13 November 2024 (First Calderbank Offer), being 27 November 2024?

   (b)Alternatively, whether the Court should exercise its discretion to award indemnity costs from the expiry of the Calderbank offer dated 19 March 2025 (Second Calderbank Offer), being 26 March 2025?

7. It is appropriate to consider the principles in respect of the discretion to award indemnity costs, including where a Calderbank offer has been made but not accepted, prior to turning to consider these issues.

   Discretion to award indemnity costs based on a Calderbank offer

8. Under the Uniform Civil Procedure Rules 1999 (UCPR), the starting point in respect of costs is r 681 which provides:

   “(1)Costs of a proceeding, including an application in a proceeding, are in the discretion of the court but follow the event, unless the court orders otherwise.

   (2)         Subrule (1) applies unless these rules provide otherwise.”

9. The Court has a wide general discretion as to costs under r 681. Costs would follow the event in the usual course. Here, the plaintiffs have been wholly unsuccessful in respect of the claim and costs should follow that event.

10. Further, pursuant to r 702 of the UCPR, costs are to be assessed on the standard basis unless the UCPR or an order of the Court provides otherwise.

11. The Court also has a wide power to award indemnity costs in accordance with the principles identified in the authorities.  What is required is something in the circumstances of the case to warrant a departure from “the usual course”.  It requires something more than the “demerit of a party’s case”.[3] 

    [3]Colgate Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225; [1993] FCA 536; AKS Investment Pty Ltd v National Australia Bank (No 2) [2012] QSC 282, Applegarth J; Fairfield Services Pty Ltd (in liquidation) v Leggett [2020] QSC 183, Bond J (as his Honour then was); Emanuel Management Pty Ltd (in liquidation) v Foster’s Brewing Group Ltd and Coopers & Lybrand [2003] QSC 299, Chesterman J (as his Honour then was).

12. While the categories are not closed, the authorities do recognise some circumstances that warrant the exercise of the discretion.  For example:

    (a)The making of allegations of fraud knowing them to be false and the making of irrelevant allegations of fraud.

    (b)Evidence of particular misconduct that causes loss of time to the Court and to other parties.

    (c)Proceedings commenced or continued for some ulterior motive.

    (d)Proceedings commenced or continued in wilful disregard of known facts or clearly established law.

    (e)The making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions.

    (f)An imprudent refusal of an offer to compromise.[4]

    [4]Colgate Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225; [1993] FCA 536; 233 (point 5) per Sheppard J.

13. It is the last circumstance which arises for consideration in respect of the First Calderbank Offer and the Second Calderbank Offer.

14. Even in respect of these categories, the question remains whether the particular facts and circumstances of the case warrant the making of an order for payment of costs other than on a standard basis.  It remains in the discretion of the judge.[5]

    [5]Colgate Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225; [1993] FCA 536; 234 (points 5 and 6) per Sheppard J.

15. A helpful summary of the principles in respect of offers made pursuant to the principles in Calderbank v Calderbank[6] is contained in the reasons of Cooper J in the Queensland Court of Appeal decision of McGee v Independent Assessor & Anor [No 2].[7]

    [6][1975] 3 All ER 333.

    [7][2024] QCA 7 at [21]-[26], with whom Dalton JA agreed and which Bond JA identified as correct at paras [5] and [2] respectively.

16. The relevant principles include:

    (a)The discretion provided by r 681 UCPR is wide but is informed by the statement of principle that the usual exercise of the discretion is that costs follow the event.[8]

    [8]At [21], citing Sequel Drill & Blast Pty Ltd v Whitsunday Crushers Pty Ltd (No 2) [2009] QCA 239 at [3]; Nine Network Australia Pty Ltd v Wagner [2021] QCA 84 at [11]-[12].

    (b)A recognised circumstance in which the Court may exercise its discretion to order costs on the indemnity basis is where a party unreasonably rejects or fails to accept a Calderbank offer.[9]

    [9]At [22]; citing Harbour Radio Pty Limited v Wagner [2020] QCA 83 at [3].

    (c)There is no presumption or predisposition in favour of ordering an assessment on the indemnity basis simply because a party rejects an offer and subsequently obtains a less favourable judgment.[10]

    [10]At [22]; citing Tector v FAI General Insurance Company Ltd [2001] 2 Qd R 463 at [5] and Roberts v Prendergast [2013] QCA 89 at [12].

    (d)The failure to accept a Calderbank offer is a matter to which a court should have regard when considering whether to order indemnity costs. The critical question is whether the rejection of the offer was unreasonable in the circumstances.  The party seeking the order must show that the other party acted unreasonably or imprudently in not accepting the offer.[11]

    [11]At [23] quoting J & D Rigging Pty Ltd v Agripower Australia Ltd [2014] QCA 23 at [5].

    (e)The consideration of whether the rejection of an offer was unreasonable should ordinarily have regard to at least the following matters:[12]

    [12]At [23] quoting J & D Rigging Pty Ltd v Agripower Australia Ltd [2014] QCA 23 which cited with approval the matter set out by the Victorian Court of Appeal in Hazeldene’s Chicken Farm Pty Ltd v Victorian Workcover Authority (No 2) (2005) 13 VR 435; [2005] VSCA 298 at [25], see also the reasons of Bond JA in McGee at [2] referencing his earlier decision of S.H.A Premier Constructions Pty Ltd v Niclin Constructions Pty Ltd [2020] QSC 323 at [8]-[14].

    (i)the stage of the proceeding at which the offer was received;

    (ii)the time allowed for the offeree to consider the offer;

    (iii)the extent of the compromise offered;

    (iv)the offeree’s prospects of success, as assessed at the date of the offer;

    (v)the clarity with which the terms of the offer were expressed; and

    (vi)whether the offer foreshadowed an application for indemnity costs in the event of the offeree rejecting it.

    (f)The non-acceptance of a Calderbank offer may in some cases be a strong factor to be taken into account on an application for indemnity costs.[13]

    (g)If the offeree makes a submission that rejection of the offer was not unreasonable, then it should at least point to a reason for not accepting the offer beyond the usual prospects of being successful in litigation.[14]

    [13]At [25], citing the High Court decision of Stewart v ATCO Controls Pty Ltd (in Liq) (No 2) (2014) 252 CLR 331 at [4].

    [14]At [25] and [26], quoting Stewart v ATCO Controls Pty Ltd (in Liq) (No 2) (2014) 252 CLR 331 and citing Comgroup Supplies Pty Ltd v Products for Industry Pty Ltd [2016] QCA 130 at [2].

17. Whether the rejection of a Calderbank offer was unreasonable involves consideration of the relevant circumstances, including the strengths and weaknesses of the relevant party’s case at the time the offer was made, and that the plaintiffs ultimately failed in respect of their claim.

18. Turning to consider the First Calderbank Offer and the Second Calderbank Offer and the relevant circumstances.

    Whether the Court should exercise its discretion to award indemnity costs from the expiry of First Calderbank Offer?

19. The First Calderbank Offer was made by letter dated 13 November 2024 and relevantly:

    (a)Was marked “without prejudice save as to costs”.

    (b)Was stated to be open for 14 days.

    (c)Was stated to be made in accordance with the principles set out in Calderbank v Calderbank.[15]

    (d)Was stated to be relied upon on the question of costs, including indemnity costs.

    [15][1975] 3 All ER 333.

20. By the First Calderbank Offer the defendants offered to settle the proceeding on the following basis:

    “1. That within 21 days from the date of acceptance, [the plaintiffs] shall vacate the property situated at 11 Wendron Street, Rochedale South;

    2. [The defendants] shall pay to [the plaintiffs] the sum of $50,000, payable as follows:

    a.The sum of $5,000 upon all parties signing a Deed of Compromise; and

    b.The balance of $45,000 upon the sale of 11 Wendron Street, Rochedale (sic) by [the defendants].”

21. The First Calderbank Offer also stated:

    “Should [the plaintiffs] be agreeable to [the defendants’] offer to settle, [the defendants’ solicitors] will prepare a Deed of Compromise that will require the discontinuance of proceedings in the Supreme Court and the withdrawal of caveat by [the plaintiffs].”

22. The defendants contend that the First Calderbank Offer was expressed in clear terms, contained a genuine element of compromise,[16] and was made at a stage when each party had sufficient opportunity to assess the factual circumstances and evidence in the proceeding.

    [16]Reflective of the defendants’ concerns as to the plaintiffs’ accommodation needs.

23. Further, the defendants point to the following as relevant to the consideration of whether the First Calderbank Offer was unreasonably rejected by the plaintiffs:

    (a)The proceedings were incorrectly commenced by way of originating application and proceeded by way of claim and statement of claim.

    (b)The plaintiffs failed to renew their caveat which resulted in the interim application heard on 18 December 2024.

    (c)In light of the Reasons, the caveat should not have been lodged.

    (d)The plaintiffs filed a significantly amended claim and statement of claim on 31 January 2025.

    (e)The plaintiffs filed further amended statements of claim on 10 March 2025 and 24 March 2025.

    (f)The defendants always denied the making of the alleged promises and further denied that there were any grounds giving rise to a constructive trust of the Rochedale South Property in favour of the plaintiffs.

24. In response, the plaintiffs raise a number of matters including:

    (a)The First Calderbank Offer was made at an early stage in the proceeding.  In particular, disclosure was incomplete and evidence was still being assessed.  The plaintiffs point to the ongoing assessment of evidence relating to family dynamics, foreclosure duress, the alleged rent-free promise, and alternative accommodation.

    (b)The First Calderbank Offer was derisory, being less than 8% of the claimed value, and required immediate vacation of the Rochedale South Property, which was central to the dispute.

    (c)The plaintiffs reasonably believed their case was strong, given the parent-child context which was argued to raise a presumption of influence.

    (d)The plaintiffs’ claim was not baseless.  Rather the claim was fact-intensive.  The plaintiffs submit that the case turned on credibility in a familial context where outcomes are unpredictable.  Further, the plaintiffs were entitled to test equitable issues without the claim being characterised as unreasonable.

    (e)The First Calderbank Offer lacked genuine compromise relative to the claim’s value and required surrender of possession without addressing ongoing accommodation needs.

    (f)Mutual rejections of offers underscore contested prospects and genuine dispute, not unreasonableness by one side.

    (g)The matter was a genuine familial dispute over property rights and did not involve misconduct or hopeless claims.  The award of indemnity costs would be punitive, not compensatory.

25. The plaintiffs submit that in these circumstances, the defendants have not discharged their onus of proving unreasonableness and the rejection of the First Calderbank Offer was not unreasonable.

26. The plaintiffs also refer to two formal offers made under Chapter 9, Part 5 of the UCPR which were not accepted by the defendants. The first offer was made on 12 March 2025 and the second on 20 March 2025. The plaintiffs seek to rely on these offers as evidence of the plaintiffs’ willingness to negotiate and that they were not intransient.

27. It is not submitted that the formal offers are a factor that must be taken into account in respect of the costs order. 

28. Turning to consider the factors identified at [16(e)] above in respect of the First Calderbank Offer:

    (a)The First Calderbank Offer was made two months after the first statement of claim was filed and over four months before the trial.  The relatively early stage of the proceeding weighs against the First Calderbank Offer being made at a time when it could be properly evaluated.  Disclosure was yet to be completed.  No affidavits were filed as evidence in chief and the trial proceeded on the parties giving oral evidence.  Summaries of the witnesses’ anticipated evidence were not ordered to be filed.

    (b)The First Calderbank Offer was open for 14 days, and therefore was open for a reasonable time.  However, given the relatively early stage of the proceeding, the parties may not have been in a position to be able to fully consider the strengths and weaknesses of their respective positions at the time.

    (c)A genuine compromise was included in the First Calderbank Offer by the defendants offering to pay a total of $50,000 to the plaintiffs.  The plaintiffs point to the amount offered being significantly less than the amount claimed, however that is not determinative.  Given the defendants denied the claim and contended that no amount was payable, the First Calderbank Offer can be characterised as a genuine offer of compromise.

    (d)The defendants’ prospects of success at the time of the First Calderbank Offer depended on the likelihood of the Court accepting the evidence of the defendants over the evidence of the plaintiffs.  Given the nature of the claim, the credibility and reliability of the plaintiffs and the defendants was a central issue in the strength of the positions of both the plaintiffs and the defendants.

    (e)The First Calderbank Offer did not articulate the evidence or reasons in support of the offer and why non-acceptance of the offer would be unreasonable.  There was no attempt to point out the deficiencies in the plaintiffs’ claim or why the plaintiffs would be unsuccessful at trial.  Further, the First Calderbank Offer is arguably conditional on the execution of a deed of settlement and there is some uncertainty as to whether the terms of the deed of settlement were intended to go beyond what was contained in the First Calderbank Offer.  The First Calderbank Offer also did not deal with costs of the proceeding.  These factors weigh against the First Calderbank Offer being made in clear terms that made its rejection unreasonable in the circumstances at that time.

    (f)The First Calderbank Offer foreshadowed an application for indemnity costs in the event of the plaintiffs rejecting it.

    (g)The plaintiffs contend that the rejection of the First Calderbank Offer was not unreasonable and point to the nature of the claim and the unpredictability of evaluating claims that turn on the credibility of witnesses.  They do not point to a specific reason for not accepting the First Calderbank Offer beyond the usual prospects of being successful in litigation or that they had an arguable case.  However, the First Calderbank Offer did not identify any compelling reasons supporting the defendants’ position and did not articulate why rejecting the First Calderbank Offer would be unreasonable.  There is no general rule that an offer must articulate the basis for which the offer should be accepted but it may be a relevant factor depending on all of the circumstances existing at the time of the offer.[17] 

    (h)The plaintiffs ultimately failed for reasons consistent with the matters identified in the version of the defendants’ defence filed on 11 October 2024, which was the defendants’ position at the time the First Calderbank Offer was made. 

    [17]Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) (2005) 13 VR 435; [2005] VSCA 298 at [26] and [27]. See also Hewitt v Count Financial Ltd (No 2) [2017] VCC 405 at [15].

29. The case of Lawrence v Ciantar (No 2)[18] is an example of a claim for an interest in property which was ultimately unsuccessful and where a Calderbank offer was relied upon in support of indemnity costs.  Relevant factors included that it was made at a very early stage of the proceeding, before all of the evidence was filed, and that the offer contained a statement that there was “no chance” of success in respect of the relief sought.  It was noted that the offer was made at a time when the plaintiff was unlikely to know the full extent of the defendants’ case.  In those circumstances, Henry J commented that “the defendants should have done more to explain why their case would succeed and why … it was reasonable for the plaintiff to accept the … offer.”[19]

    [18][2019] NSWSC 722.

    [19]At [53].

1. Here, the First Calderbank Offer was not clear in its terms in respect of the terms of the “Deed of Compromise”, whether it was a conditional offer, or costs of the proceeding.  Further, in a case involving allegations of unconscionability and undue influence and where no affidavits[20] or witness summaries were filed as evidence in chief, the defendants should have done more to explain why their case would succeed and why it was reasonable to accept the First Calderbank Offer.

   [20]The only affidavit filed at the time the First Calderbank Offer was that of the second plaintiff.  The defendants had not filed any affidavit material.

2. In all of the circumstances, I am not satisfied that the plaintiffs’ rejection of the First Calderbank Offer was unreasonable and consequently I am not satisfied that a departure from the general costs rule in r 681 of the UCPR is justified by the rejection of the First Calderbank Offer.

3. Turning now to consider the Second Calderbank Offer.

Whether the Court should exercise its discretion to award indemnity costs from the expiry of Second Calderbank Offer?

1. The Second Calderbank Offer was made by letter dated 19 March 2025 and relevantly:

   (a)Was marked “without prejudice save as to costs”.

   (b)Was stated to be open for 7 days.

   (c)Was stated to be made in accordance with the principles set out in Calderbank v Calderbank.[21]

   (d)Was stated to be relied upon on the question of costs, including indemnity costs.

   [21][1975] 3 All ER 333.

2. By the Second Calderbank Offer the defendants offered to settle the proceeding on the following basis:

   “11 Wendron Street, Rochedale South

   1.   That within 28 days from the date of a signed Agreement between the parties, [the plaintiffs] shall vacate the property situated at 11 Wendron Street, Rochedale South.

   2.   Within 30 days from the date that [the plaintiffs] vacate the property, [the defendants] are to do all such acts and things and sign all such documents as may be necessary to list and sell the property with an agent of their choosing.

   Payment of Rent

   3.   Upon acceptance of the offer to settle and signing of an Agreement, [the plaintiffs] shall reside in the property under licence, free from any rental until the property is vacated on the 28^th day after the signing of the [A]greement.

   Payment of Monies

   4.   That within 7 days of a signed Agreement, [the defendants] shall pay to [the plaintiffs] the sum of $10,000 to assist them with relocation costs.

   5.   Upon the settlement of the sale of the property, the sale proceeds shall be paid as follows:

   i.     To pay all costs, commissions and expenses of the sale and to pay any Council rates and water rates and maintenance levies outstanding in respect of the Property; then

   ii.    To pay any legal costs associated with the sale;

   iii.   To discharge the Mortgage and any other encumbrances affecting the Property;

   iv.   To pay this sum of $290,000 to [the plaintiffs]; and

   v.    The balance to [the defendants].

   This offer is made with a view to attempt to settlement (sic) the matters between the parties in full with each party to bear their own costs in the matter.”      

3. The Second Calderbank Offer then sets out an explanation for the calculation of the amount to be paid to the plaintiffs, being the historical valuation of $550,000 less the amount to pay out the plaintiffs’ mortgage and outstanding rates at the time of the Transfer to the defendants.  This amount is above the plaintiffs’ equity in the Rochedale South Property at the time of the Transfer and represented 54% of the equity in the Property at the time.  Further, the amount does not take into account other expenses incurred and paid by the defendants in respect of the Property since the Transfer.

4. Further, the Second Calderbank Offer states:

   “Should [the plaintiffs] be agreeable to [the defendants’] offer to settle, [the defendants’ solicitors] will draft a Deed of Settlement to record to (sic) Agreement reached between the parties.  The Deed of Settlement will contemplate a Discontinuance of the proceedings, as well as a withdrawal of any Caveat on the Title by [the plaintiffs].”

5. The defendants contend that the Second Calderbank Offer was expressed in clear terms, contained a genuine element of compromise, and was made at a stage when each party had sufficient opportunity to assess the factual circumstances and evidence in the proceeding.

6. The matters identified by the defendants as relevant to the consideration of whether the First Calderbank Offer was unreasonably rejected by the plaintiffs and outlined at [23] above are also relevant to the consideration of the Second Calderbank Offer.

7. In response, the plaintiffs raise a number of matters including that the Second Calderbank Offer was made only one week before the trial and that the amount was below half of the plaintiffs’ claim.  The plaintiffs also submit that the Second Calderbank Offer ignored the plaintiffs’ vulnerability and core claim for security of accommodation.  The factors identified at [24(c)-(g)] above are also relevant.

8. The plaintiffs submit that in these circumstances:

   (a)The defendants have not discharged their onus to prove that the rejection of the Second Calderbank Offer was unreasonable.

   (b)The rejection of the Second Calderbank Offer was reasonable.

9. Turning to consider the factors identified at [16(e)] above in respect of the Second Calderbank Offer:

   (a)The Second Calderbank Offer was made one week before the trial.  The relatively late stage of the proceeding weighs in favour of the Second Calderbank Offer being made at a time when it could be properly evaluated as both parties would have been preparing for trial.  However, no affidavits were filed as evidence in chief and the trial proceeded on the parties giving oral evidence.  Summaries of the witnesses’ anticipated evidence were not ordered to be filed.

   (b)The Second Calderbank Offer was open for 7 days.  At this time, the parties would have been preparing for trial and the issues would have been front of mind. In the particular circumstances, it was a reasonable time for the parties to be able to fully consider the strengths and weaknesses of their respective positions.

   (c)A genuine compromise was included in the Second Calderbank Offer by the defendants offering to pay a total of $300,000 to the plaintiffs.  The plaintiffs point to the amount offered being significantly less than the amount claimed and not addressing ongoing accommodation needs.  That is not determinative.  Given the defendants denied the claim and contended that no amount was payable, the Second Calderbank Offer can be characterised as a genuine offer of compromise.

   (d)The defendants’ prospects of success at the time of the Second Calderbank Offer depended on the likelihood of the Court accepting the evidence of the defendants over the evidence of the plaintiffs.  Given the nature of the claim, the credibility and reliability of the plaintiffs and the defendants was a central issue in the strength of the positions of both the plaintiffs and the defendants.

   (e)The Second Calderbank Offer did articulate the basis of the calculation of the total amount to be paid and also articulated why it was a reasonable figure given the other expenses that the defendants would have incurred in respect of the Rochedale South Property.  The Second Calderbank Offer also included that each party bear their own costs of the proceeding. However, the Second Calderbank Offer did not otherwise articulate the evidence or reasons in support of the offer and why non-acceptance of the offer would be unreasonable.  There was no attempt to point out the deficiencies in the plaintiffs’ claim or why the plaintiffs would be unsuccessful at trial.  Further, the Second Calderbank Offer is arguably conditional on the execution of a deed of settlement[22] and there is some uncertainty as to whether the terms of the deed of settlement were intended to go beyond what was contained in the Second Calderbank Offer.  These factors weigh against the Second Calderbank Offer being made in clear terms that made its rejection unreasonable in the circumstances at that time.

   (f)The Second Calderbank Offer foreshadowed an application for indemnity costs in the event of the plaintiffs rejecting it.

   (g)The plaintiffs contend that the rejection of the Second Calderbank Offer was not unreasonable and point to the nature of the claim and the unpredictability of evaluating claims that turn on the credibility of witnesses.  They do not point to a specific reason for not accepting the Second Calderbank Offer beyond the usual prospects of being successful in litigation or that they had an arguable case.  However, the Second Calderbank Offer did not identify any compelling reasons supporting the defendants’ position or reasons why rejecting the Second Calderbank Offer was unreasonable, which is a relevant factor in all of the circumstances.[23] 

   (h)The plaintiffs ultimately failed for reasons consistent with the matters identified in the version of the defendants’ Further Amended Defence filed on 18 March 2025, which was the defendant’s position at the time the Second Calderbank Offer was made. 

   [22]Referred to as an “Agreement” in some terns of the Second Calderbank Offer and a “Deed of Settlement” elsewhere.  It is likely that these are the same document, but it is not clear.

   [23]Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) (2005) 13 VR 435; [2005] VSCA 298 at [26] and [27]. See also Hewitt v Count Financial Ltd (No 2) [2017] VCC 405 at [15].

10. Here, the Second Calderbank Offer was not clear in its terms in respect of the terms of the “Agreement” and/or ‘Deed of Settlement” and whether it was a conditional offer.  Further, in a case involving allegations of unconscionability and undue influence and where no affidavits or witness summaries were filed as evidence in chief, the defendants should have done more to explain why their case would succeed and why it was reasonable to accept the First Calderbank Offer.

11. In all of the circumstances, I am not satisfied that the plaintiffs’ rejection of the Second Calderbank Offer was unreasonable and consequently I am not satisfied that a departure from the general costs rule in r 681 of the UCPR is justified by the rejection of the Second Calderbank Offer.

    Costs order

12. Accordingly, the appropriate order is that the plaintiffs pay the defendants costs on the standard basis.

    The Court orders that:

    1.   The plaintiffs pay the defendants’ costs on the standard basis.