Marshall v O'Flaherty (Costs)

The case of Marshall v O'Flaherty involved the plaintiff, Marshall, who had brought applications for leave to commence proceedings in the District Court of New South Wales under the Personal Injury Commission Act 2020 (NSW) and to commence proceedings out of time under the Motor Accident Compensation Act 1999 (NSW). Both applications were granted, and orders for costs were made, allowing for the costs to be costs in the proceedings but with liberty to apply. Subsequently, the defendant, O'Flaherty, sought orders that Marshall pay O'Flaherty’s costs, raising questions about the indulgence principle and the appropriate weight to give to orders proposed by the judge.

The legal issues in the case centred on the exercise of the court's discretion in awarding costs, particularly the application of the indulgence principle. The court was required to consider the role of any indulgence factors in the exercise of its discretion, the relevance of combative opposition to the orders sought by the plaintiff, and the weight to be given to the orders proposed by the judge, who had the benefit of written submissions on costs. Additionally, the court had to determine whether any new or different costs factors had been identified that warranted a variation of the original costs order.

In addressing these issues, the court noted that the indulgence principle required a consideration of all relevant factors, including the combative nature of the opposition. However, the court found no new or different costs factors that warranted a variation of the original costs order. The court further held that the orders proposed by the judge, who had the benefit of written submissions, should be given appropriate weight. The application to vary the costs order was dismissed, and it was ordered that the costs of the defendant’s application be included in the costs order of 25 October 2022 when these costs come to be agreed or assessed.