Litfin v Wenck (No 2)

In the case of Litfin v Wenck (No 2), the Respondent sought costs of and incidental to the Originating Application, including any reserved costs, from the Applicant. This followed a previous court decision where the Applicant's application was dismissed and reasons were published. The Respondent requested three specific orders regarding the costs, including costs on a standard basis from the commencement of the application until a certain date, and costs on an indemnity basis from a later date. The Applicant argued that the costs should be paid on a standard basis only.

The legal issues revolved around the appropriate basis for awarding costs, particularly whether the rejection of the Respondent's offer to compromise was unreasonable, thereby justifying an order for indemnity costs. The Respondent's offer, made under the principles of Calderbank v Calderbank, was open for four weeks and foreshadowed that indemnity costs would be sought if not accepted. The Respondent cited relevant legal principles, including the discretion of the court to order indemnity costs when there is an unreasonable rejection of a Calderbank offer.

The court considered the Respondent's success in the proceedings and the discretion to award costs on an indemnity basis. The court noted that the unreasonable refusal of a Calderbank offer can justify an order for indemnity costs. The onus was on the Respondent to establish that the rejection was unreasonable, considering the strengths and weaknesses of the Applicant's case at the time of the offer. The court concluded that the rejection was unreasonable given the Applicant's ultimate failure in the proceedings.

The court made the following orders: (1) the Applicant must pay the Respondent's costs of and incidental to the Originating Application on a standard basis from the commencement until a specified date; (2) the assessment of these costs must be made on a standard basis, with certain fees regarded as necessary and proper; and (3) the Applicant must pay the Respondent's costs of and incidental to the Originating Application on an indemnity basis from a later date.