Hill v Zhang (No 2)

Hill v Zhang (No 2) concerned an application for costs of an interlocutory hearing to be paid partly on an indemnity basis, and be taxed and payable immediately. The case was heard in the Federal Court of Australia. The primary legal issues involved whether the court should grant part of the respondents’ costs on an indemnity basis and whether the costs should be taxed and payable immediately.

The respondents argued that the applicants’ repudiation of their offer to replead without incurring costs thrown away constituted a special feature justifying indemnity costs. They also sought an order for immediate taxation and payment of costs, arguing that the need to replead would result in essentially new proceedings, the issue of security for costs was discrete, and they had incurred significant additional costs due to the applicants’ conduct. The court accepted the respondents’ submissions, finding that the applicants' conduct warranted an order for indemnity costs from 11 September 2019. The court also agreed that it was appropriate to order that the costs be taxed and payable immediately, given the discrete nature of the security for costs issue and the indefinite period before the proceedings could be finalised.

Consequently, the court ordered that the applicants pay the respondents' costs of and incidental to the interlocutory application on a party and party basis to 11 September 2019 and thereafter on an indemnity basis, including the costs thrown away from the striking out of the applicants’ pleading. The court further ordered that these costs be taxed and payable immediately.