ISS Facility Services (NSW) Pty Ltd v State of New South Wales (No 2)

The appeal concerned the costs of proceedings that had been remitted to the District Court for a retrial. The parties involved were ISS Facility Services (NSW) Pty Ltd and the State of New South Wales. The dispute, as reflected in the costs orders, related to proceedings that had been heard in the District Court and subsequently appealed to the Court of Appeal.

The central legal issue before the Court of Appeal was how to allocate the costs of the appeal and cross-appeals, given that the underlying proceedings were to be retried in the District Court. Specifically, the court had to determine whether the costs of the appeal proceedings should be determined immediately or be treated as costs in the remitted proceedings, and how the costs of the original District Court proceedings should be handled.

The Court of Appeal reasoned that it was appropriate to treat the costs of the appeal and cross-appeals as costs in the District Court proceedings. This approach recognised that the ultimate outcome of the litigation, which would be determined at the retrial, was the most relevant factor in assessing costs. The court therefore ordered that the parties’ costs of the appeal and each of the cross-appeals in the Court of Appeal be their respective costs in the proceedings in the District Court. Furthermore, the court left the parties’ costs of the original proceedings in the District Court to the discretion of the judge to whom the proceedings were remitted, to be determined once the outcome of the litigation was known.