Jojeni Investments Pty Ltd v Mosman Municipal Council (No 2)

Jojeni Investments Pty Ltd (the appellant) appealed to the Court of Appeal of New South Wales against costs orders made by the Land and Environment Court in favour of Mosman Municipal Council (the respondent). The dispute concerned an application for declaratory relief in an area of public law, where the Council was the only appropriate contradictor.

The primary legal issues before the Court of Appeal were whether an offer of compromise made by the respondent, which consented to declaratory relief with each party bearing its own costs, complied with the relevant rules, and whether the primary judge erred in exercising discretion regarding costs, particularly in light of the ultimate orders made. The court also considered the reasonableness of the respondent's refusal of a *Calderbank* offer made by the appellant and the appellant's application for special costs orders.

The Court of Appeal held that the respondent's offer of compromise was compliant with the rules, as it was permissible to offer consent to declaratory relief with each party paying its own costs. The court further found that even where the ultimate orders made were no less favourable to the offeror than the terms of the offer, the court retained a discretion to order otherwise. The refusal of the *Calderbank* offer was not deemed unreasonable given the public law context and the identity of the contradictor. Consequently, the appeal court set aside the costs orders made in the Land and Environment Court.

The Court of Appeal ordered that the respondent pay the appellant's costs of both the proceedings at first instance and the appeal on the ordinary basis. However, the appellant was ordered to pay the respondent's costs of the costs application on the ordinary basis.