Maxcon Constructions Pty Ltd v Vadasz & Ors

The High Court of Australia heard an application by the first respondent, Mr Vadasz, seeking an order that the appellant, Maxcon Constructions Pty Ltd, pay Mr Vadasz's assessed costs of High Court proceedings, together with accrued interest. These costs arose from Mr Vadasz successfully resisting Maxcon's appeal to the High Court, which had been dismissed on 14 February 2018. The dispute centred on Maxcon's refusal to pay the certified costs, despite having given an undertaking to do so as a condition for the grant of special leave to appeal.

The primary legal issue before the Court was whether Maxcon's undertaking to pay Mr Vadasz's costs of the appeal was absolute, or if it could be qualified by Maxcon's assertion of offsetting claims against Mr Vadasz, which were the subject of separate, pending proceedings. The Court was also required to consider whether Maxcon's conduct in resisting payment warranted an order for indemnity costs for Mr Vadasz's application.

The Court reasoned that the undertaking given by Maxcon was categorical and was the price for the grant of special leave to appeal. It was intended to protect Mr Vadasz from the expenses incurred due to Maxcon's appeal, and was not subject to any qualification that would permit Maxcon to deduct alleged offsetting claims. The Court found that Maxcon had taken the benefit of the grant of special leave and could not now seek to be relieved of the condition attached to it. Maxcon's assertion of offsetting claims was not a valid reason to avoid fulfilling its undertaking. Furthermore, the Court determined that Maxcon's position was unreasonable, necessitating the award of indemnity costs for Mr Vadasz's application.

Accordingly, the High Court ordered Maxcon to pay Mr Vadasz the sum of $183,717.07 within seven days, along with interest. Maxcon was also ordered to pay Mr Vadasz's costs of the application on an indemnity basis.