Hungry Jack's Pty Ltd v Fourtounas (No 2)

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Court of Appeal


Supreme Court


New South Wales

Medium Neutral Citation: Hungry Jack’s Pty Ltd v Fourtounas (No 2) [2021] NSWCA 26
Hearing dates: On the papers
Decision date: 05 March 2021
Before: Basten JA; White JA
Decision:

Vary order (2) made on 10 December 2020 requiring the applicant to pay the respondents costs in this Court, so that it now provides:

Order that the applicant pay the respondent’s costs assessed on the ordinary basis up to and including 15 October 2020 and thereafter on an indemnity basis, such costs to include the costs of the motion to vary the earlier order.

Catchwords:

APPEAL – application for leave refused – costs ordered – application to vary order – offer of compromise – indemnity costs sought

COSTS – indemnity costs – offer of compromise – whether offer open for reasonable period – whether offer involved compromise – default entitlement – power to order otherwise – onus on applicant to establish reasons for different costs order – Uniform Civil Procedure Rules 2005 (NSW) rr 20.26, 42.15A

Legislation Cited:

Uniform Civil Procedure Rules 2005 (NSW), rr 20.26, 42.15A, 51.47

Cases Cited:

Regency Media Pty Ltd v AAV Australia Pty Ltd [2009] NSWCA 368

Category:Costs
Parties: Hungry Jack’s Pty Ltd (Applicant)
Sylvia Fourtounas (Respondent)
Representation:

Counsel:
Mr D A Lloyd SC (Applicant)
Mr E P Anderson (Respondent)

Solicitors:
Gillis Delaney Lawyers (Applicant)
Gerard Malouf & Partners (Respondent)
File Number(s): 2020/177378
 Decision under appeal 
Court or tribunal:
District Court
Jurisdiction:
Civil
Date of Decision:
29 May 2020
Before:
Norton SC DCJ
File Number(s):
2019/46773

Judgment

  1. THE COURT: On 10 December 2020 the Court dismissed an application by Hungry Jack’s Pty Ltd (the applicant) for leave to appeal from a judgment in favour of the respondent, Sylvia Fourtounas, in the District Court. This Court directed that the applicant pay the respondent’s costs of the application for leave to appeal. [1]

  2. Ms Fourtounas has sought to vary the costs order. The application by notice of motion was filed within the time permitted, namely within 14 days from the date of entry of the orders. She seeks the following orders:

  1. the applicant to pay the respondent’s costs on the ordinary basis up to and including 15 October 2020, and thereafter on an indemnity basis from 16 October 2020;

  2. the applicant to pay the respondent’s costs of and incidental to this notice of motion on an indemnity basis.

  1. On 15 October 2020 the respondent’s solicitors served an offer of compromise which sought that the summons seeking leave to appeal be dismissed with no order as to costs. The offer remained open for a period of 14 days. It was not accepted. Pursuant to the Uniform Civil Procedure Rules 2005 (NSW) (UCPR), r 42.15A, where the defendant (respondent) makes an offer which is not accepted by the plaintiff (applicant) and the defendant obtains a judgment no less favourable than the terms of the offer, the normal rule…

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Details
Case
[2021] NSWCA 26
Decision Date

CaseChat Overview and Summary

Hungry Jack's Pty Ltd (the applicant) sought to vary an earlier costs order made by the Court of Appeal of the Supreme Court of New South Wales in favour of Fourtounas (the respondents). The dispute concerned the basis on which the applicant should pay the respondents' costs following an application for leave to appeal.

The primary legal issue before the court was whether the earlier costs order, which directed the applicant to pay the respondents' costs on an ordinary basis, should be varied to include an order for indemnity costs from a specific date. This question turned on the application of rule 42.15A of the Uniform Civil Procedure Rules 2005 (NSW), which allows for indemnity costs to be ordered in certain circumstances, particularly where an offer of compromise has been made. The court also considered whether an offer of compromise made by the respondents was open for a reasonable period and genuinely involved a compromise.

The court reasoned that the onus was on the applicant to establish why a costs order should depart from the usual rule that costs follow the event. While the applicant argued that the respondents' offer of compromise was not open for a reasonable period, the court found that the offer was made in circumstances where the applicant had already indicated a lack of interest in settlement. Furthermore, the court determined that the offer did involve a compromise, as it was made in response to the applicant's application for leave to appeal. Consequently, the court concluded that the respondents were entitled to an order for indemnity costs from the date of their offer of compromise.

The court varied the order made on 10 December 2020. The applicant was ordered to pay the respondents' costs assessed on the ordinary basis up to and including 15 October 2020, and thereafter on an indemnity basis. This indemnity costs order was to include the costs of the motion to vary the earlier order.

Orders

Orders of the court

Vary order (2) made on 10 December 2020 requiring the applicant to pay the respondents costs in this Court, so that it now provides:

Order that the applicant pay the respondent’s costs assessed on the ordinary basis up to and including 15 October 2020 and thereafter on an indemnity basis, such costs to include the costs of the motion to vary the earlier order.

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

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