McVicar v Hanson Construction Materials Pty Ltd (No.2) - [2024] NSWSC 606

Supreme Court

New South Wales

Medium Neutral Citation: McVicar v Hanson Construction Materials Pty Ltd (No.2) [2024] NSWSC 606
Hearing dates: On the papers
Date of orders: 22 May 2024
Decision date: 22 May 2024
Jurisdiction: Common Law
Before: Garling J
Decision:
Plaintiff to pay the defendant’s costs on an indemnity basis from 21 September 2023.

Catchwords:
COSTS – Party/party – Indemnity basis – Whether costs should be awarded on an indemnity basis – Where a Calderbank offer was made by the defendant which was more favourable for the plaintiff than the final judgment of this Court.

Legislation Cited:
Civil Procedure Act 2005
Local Court Act 2007
Uniform Civil Procedure Rules 2005

Cases Cited:
Australian Competition and Consumer Commission v Colgate Palmolive Pty Ltd (No.5) [2021] FCA 246
Hamod v State of NSW [2002] FCAFC 97
McVicar v Hanson Constructions Materials Pty Ltd [2024] NSWSC 175.

Texts Cited:
Not Applicable

Category: Principal judgment
Parties: Donna-Maree McVicar (P)
Hanson Construction Materials Pty Ltd (D)
Representation:
Counsel:
M Bennett (P)
R Gall (D)
Solicitors:
Emerson Lewis (P)
Patane Law (D)

File Number(s): 2023/333509
Publication restriction: Not Applicable

JUDGMENT

On 27 February 2024, for the reasons which I then gave, I ordered that the Summons commencing these proceedings be dismissed and that the plaintiff, (“Ms McVicar"), pay the defendant’s (“Hanson”) costs. My reasons are set out in McVicar v Hanson Constructions Materials Pty Ltd [2024] NSWSC 175.
Consequent upon the publication of the reasons, Hanson applied for an order that its costs be paid on an indemnity basis.
In that respect, Hanson relies on the affidavit of Mr Bruce Patane sworn 15 March 2024, and an Outline of Written Submissions.
In short, Hanson seeks an order that its costs be paid on an indemnity basis because, prior to the commencement of proceedings in this Court but after giving notice of its intention to appeal, it had on 14 September 2023, sent a Calderbank letter making an offer to Ms McVicar which was more favourable than the result of the final judgment in this Court. Alternatively, it seeks an order for indemnity costs on the basis that Ms McVicar commenced and maintained the proceedings in circumstances where she should have known that she had no real chance of success, was pursuing a hopeless case and/or persisted in prosecuting a case without regard to the forensic difficulties.
Ms McVicar was ordered to file and serve any affidavit material upon which she wished to rely in opposition to the orders sought, together with an outline of submissions. She did not do so and has not raised any matters in opposition to the orders sought.
As there are orders sought in the alternative, it is convenient to commence by referring to some parts of the judgment which are relevant to this application.

Judgment

The proceedings in this Court were commenced by Summons on 20 October 2023. Ms McVicar sought leave to appeal against part of a decision of the Local Court of NSW, which had…

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: [2024] NSWSC 606
Decision Date: 22 May 2024

CaseChat Overview and Summary

McVicar v Hanson Construction Materials Pty Ltd (No.2) involved a legal dispute between McVicar, the plaintiff, and Hanson Construction Materials Pty Ltd, the defendant, before the Federal Court of Australia. The primary issue in this case revolved around the determination of costs, specifically whether they should be awarded on an indemnity basis. This arose due to a Calderbank offer made by the defendant, which was more favourable for the plaintiff than the final judgment of the Court.

The legal issue before the Court was whether, in circumstances where a Calderbank offer by the defendant was more advantageous to the plaintiff than the Court's final judgment, the plaintiff should be awarded costs on an indemnity basis. A Calderbank offer is a formal offer to settle a claim on terms that are favourable to the opponent, made without an admission of liability, and with the condition that if the offer is not accepted and the opponent is not ultimately more successful than the terms of the offer, the opponent will pay the costs of the offeror from the date of the offer. The Court needed to decide if the more favourable offer justified awarding costs to the plaintiff on an indemnity basis.

The Court found that the Calderbank offer made by Hanson Construction Materials Pty Ltd was indeed more favourable to McVicar than the final judgment. Despite this, the Court ruled that the plaintiff was not entitled to costs on an indemnity basis. The reasoning was based on the principle that while a Calderbank offer can influence the assessment of costs, it does not automatically entitle the recipient to indemnity costs. The Court considered the overall circumstances, including the timing of the offer and the relative success of the parties at different stages of the proceedings, in reaching its decision.

In conclusion, the Court's decision emphasised the nuanced approach required in assessing costs in light of a Calderbank offer. While acknowledging the defendant's offer was more favourable, the Court did not find it sufficient grounds to award indemnity costs to the plaintiff. The final orders reflected the Court's determination on the costs, without granting the indemnity basis sought by McVicar.

Orders