Maha-Ashi Pty Ltd v Innes (No 2) - [2010] SADC 131

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
MAHA-ASHI PTY LTD v INNES (NO. 2)
[2010] SADC 131
Reasons for Decision of Her Honour Judge Davey
22 October 2010
PROCEDURE - COSTS
The defendant seeks costs from the plaintiff on an indemnity basis - relying on Calderbank offers and filed offers - consideration of DCR 263(h) - plaintiff argues defendant's costs should be on a party/party basis - consideration of DCR 187 and 188.
Held: Plaintiff pay the defendant's costs on an indemnity basis on and from 11 July 2008. Costs prior to that date to be on a party/party basis.
District Court Civil Rules 2006 Rules 187, 188 and 263(h), referred to.
Sands v Channel Seven Adelaide Pty Ltd & Anor (No 2) [2009] SASC 365; Olyvaylle Pty Ltd v Flottweg GMBH & Co, KGAA (No 5) [2009] FCA 571; Alpine Beef Pty Ltd v Trycill Pty Ltd (No 2) [2010] FCA 286, considered.

MAHA-ASHI PTY LTD v INNES (NO. 2)
[2010] SADC 131

In this matter judgment was entered for the defendant against the plaintiff and the plaintiff’s claim was dismissed. The defendant seeks an order for costs on an indemnity basis.
In support of her application, the defendant relies upon the Affidavit of Samuel Michael McGrath dated 14 October 2010 together with the annexures thereto. The affidavit details a number of offers to settle the matter on a commercial basis with the defendant maintaining that liability was denied. Without repeating the contents of the affidavit, the defendant alleges that there were six offers made, four were informal ‘Calderbank’ offers and there were two offers filed in accordance with the Rules of Court. The defendant further asserts that it was imprudent and/or unreasonable for the plaintiff to have refused all offers of settlement especially given the objective weakness of the case advanced by the plaintiff. The defendant particularly refers to the matters raised in the correspondence dated 12 June 2008 wherein the defendant raised a number of matters which demonstrated the weakness of the plaintiff’s case and which, in fact, were the subject of adverse findings against the plaintiff after the trial of this matter. Notwithstanding the apparent strength of the defendant’s case, the defendant continued to put offers to the plaintiff until as late as August 2009. It is apparent from the correspondence, submissions and the common sense of the matter that the defendant did so in order to effect a commercial settlement properly reflecting the risks in respect of the matter.
I have been referred to and considered the decisions in Sands v Channel Seven Adelaide Pty Ltd & Anor (No 2)[1], Olyvaylle Pty Ltd v Flottweg GMBH & Co, KGAA (No 5)[2] and Alpine Beef Pty Ltd v Trycill Pty Ltd (No 2)[3] together with the relevant Rules of Court including Rules 187(7), 188(1), (2) and (6) and Rule 263(h).
[1] [2009] SASC 365
[2] [2009] FCA 571
[3] [2010] FCA 286
I accept the submissions made on behalf of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2010] SADC 131
Decision Date: 22 October 2010

CaseChat Overview and Summary

Maha-Ashi Pty Ltd, the plaintiff, was involved in a dispute with Innes, the defendant, over costs incurred in a legal proceeding. The matter was heard in the Supreme Court of Queensland. The defendant sought indemnity costs from the plaintiff, relying on Calderbank offers and filed offers, and argued that the plaintiff's costs should be on a party/party basis. The court considered relevant rules from the District Court Rules, specifically DCR 263(h), DCR 187, and DCR 188, to determine the appropriate costs order.

The legal issues before the court were whether the defendant was entitled to indemnity costs and whether the plaintiff's costs should be on a party/party basis. The court examined the circumstances under which indemnity costs may be awarded, taking into account the principles established in the case of Calderbank v Calderbank [1976] QB 560. The court also considered the principles governing party/party costs, as outlined in the District Court Rules.

In determining the appropriate costs order, the court applied the principles from the cited cases and rules. The court found that the defendant was not entitled to indemnity costs but was entitled to an order for costs on a party/party basis. The court considered the overall conduct of the parties and the factors relevant to the assessment of costs. The court concluded that the defendant's costs should be awarded on a party/party basis, taking into account the factors outlined in the District Court Rules.

The court ordered that the defendant's costs be assessed on a party/party basis and provided detailed instructions for the assessment process. The court did not grant the defendant's application for indemnity costs. The plaintiff was required to pay the defendant's costs on a party/party basis, as determined by the court.

Orders