In the matter of Invigor Group Limited (No 3)

In the matter of Invigor Group Limited (No 3), the court was presented with an application for indemnity costs by Invigor Group Limited against another party. The dispute originated from an application to set aside a statutory demand which was deemed to have no merit. Prior to the commencement of the proceedings, the defendant had pointed out the weaknesses of the plaintiff’s claim in their correspondence. The plaintiff had reserved the right to claim indemnity costs, leading to the current application. The court found the application to be audacious and without a proper basis, considering the circumstances.

The primary legal issue before the court was whether it was appropriate to order costs on an indemnity basis. The court had to assess the nature of the application and the circumstances leading up to it. It was necessary to determine whether the application was justified given the defendant’s prior correspondence and the plaintiff’s reservation of the right to claim indemnity costs. Additionally, the court had to consider whether fixing the costs in a gross sum was appropriate in light of the relatively small amount in dispute and the potential inability of the plaintiff to pay the costs.

The court ruled that it was appropriate to order costs on an indemnity basis due to the audacious nature of the application and the lack of proper basis. The court emphasised that the defendant’s correspondence before the proceedings commenced highlighted the weaknesses of the plaintiff’s claim, and the plaintiff had reserved the right to claim indemnity costs. The court also noted that fixing the costs in a gross sum was appropriate given the small amount in dispute and the potential inability of the plaintiff to pay the costs. Consequently, the application for indemnity costs was granted.

The final orders included an order for the defendant to pay the plaintiff’s costs of the application on an indemnity basis, fixed in a gross sum of $15,000. This decision underscores the importance of considering the circumstances surrounding an application for indemnity costs and the potential impact on the parties involved.