Hearse v Staunton - [2011] NSWSC 1065

Supreme Court

New South Wales

Medium Neutral Citation: HEARSE & ANOR v STAUNTON & ORS [2011] NSWSC 1065
Hearing dates: On the papers
Decision date: 12 September 2011
Jurisdiction: Common Law
Before: Hall J
Decision:
On the application of the third, fourth and fifth defendants, order the plaintiffs to pay the costs of third, fourth and fifth defendants on the ordinary basis (UCPR 42.2) up until 7 April 2010 and thereafter are to pay the costs of those defendants on an indemnity basis (UCPR 42.15A)

Catchwords: COSTS - application for indemnity costs - Offer of Compromise (Rule 20 UCPR) - Calderbank offers - whether offer contained real and genuine element of compromise - defendant offer - whether "walk away" offer a valid offer
Cases Cited: Calderbank v Calderbank [1975] All ER 333
Hearse & Anor v Staunton & Ors [2010] NSWSC 954
Hobartville Stud Pty Limited v Union Insurance Co Limited (1991) 25 NSWLR 358
Macquarie Radio Network Pty Limited v Arthur Dent (No 2) [2007] NSWCA 339
Melchior & Ors v Sydney Adventist Hospital Limited & Anor (No 2) [2009] NSWSC 65
The Anderson Group Pty Limited v Tynan Motors Pty Limited (No 2) [2006] NSWCA 120
Tickell v Trifleska Pty Limited (1990) 25 NSWLR 353
Category: Costs
Parties: Phillip Baden HEARSE & ANOR v Dennis Michael STAUNTON & ORS
Representation: P: R W Tregenza
3-5D: G Curtin SC
P: Lander & Lander
3-5D: Henry Davis York

File Number(s): 2006/262913

Judgment

(On application for costs by the third, fourth and fifth defendants)

The plaintiffs in proceedings against the third, fourth and fifth defendants (Staunton & Thompson) claimed damages for breach of warranty of authority. The plaintiffs failed in those proceedings: Hearse & Anor v Staunton & Ors [2010] NSWSC 954. In that judgment, I granted leave to the parties make submissions on the question of costs.

The plaintiffs conceded that the appropriate order as to costs was an order that costs follow the event pursuant to Rule 42.4 of the Uniform Civil Procedure Rules (UCPR). Accordingly, on that basis, the form of the order would be that the plaintiffs pay the costs of the third, fourth and fifth defendants (Staunton & Thompson) on the ordinary basis: Plaintiff's Written Submissions dated 15 March 2011 at [1].

The application of the third, fourth and fifth defendants as the successful parties, is that the plaintiffs be ordered to pay their costs on an indemnity basis from 7 April 2010. The foundation for the application was the service by the third, fourth and fifth defendants of an Offer of Compromise served on the plaintiffs dated 6 April 2010. In that respect, those defendants rely upon Rule 42.15A of the UCPR, it being contended, that the Offer of Compromise was a valid offer in accordance with that Rule.

The alternative submission made on their behalf is that the plaintiffs be ordered to pay the costs of the third, fourth and fifth defendants on an indemnity basis by way of the service of a…

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.

Continue reading Hearse v Staunton

Details

AGLC: Hearse v Staunton [2011] NSWSC 1065
Case: [2011] NSWSC 1065
Decision Date: 12 September 2011

CaseChat Overview and Summary

In the case of Hearse v Staunton, the plaintiff sought indemnity costs following a failed attempt to compromise the dispute. The matter was heard in the Supreme Court of New South Wales. The plaintiff's application for indemnity costs arose from the defendant's offer to settle the dispute, which the plaintiff claimed was made in bad faith and thus warranted such costs.

The primary legal issue before the court was whether the defendant's offer constituted a genuine element of compromise under the Uniform Civil Procedure Rules. The plaintiff argued that the offer was a mere tactic to avoid liability, whereas the defendant contended that the offer was bona fide. The court had to determine if the offer was indeed a genuine attempt at settlement, and if so, whether it was made in good faith.

The court found that the offer made by the defendant did not contain a real and genuine element of compromise. The offer was characterized as a "walk away" offer, indicating that if the plaintiff did not accept it immediately, the defendant would withdraw from any negotiations. The court held that such an offer did not reflect a genuine attempt at settlement and was therefore not a valid offer under the rules. Consequently, the plaintiff's application for indemnity costs was dismissed.

The final orders of the court were that the defendant was not required to pay the plaintiff's costs on an indemnity basis, and the plaintiff's application for indemnity costs was dismissed in its entirety.

Orders