Moshos v French (No. 3) - [2014] NSWSC 1417

Supreme Court

New South Wales

Medium Neutral Citation: Moshos v French (No. 3) [2014] NSWSC 1417
Hearing dates: On the papers
Decision date: 15 October 2014
Jurisdiction: Equity Division
Before: Darke J
Decision:
Proceedings dismissed. Plaintiff to pay defendants' costs of proceedings.

Catchwords: COSTS - indemnity costs - Calderbank offer not accepted by unsuccessful plaintiff - whether unreasonable of plaintiff to not accept offer
Cases Cited: Calderbank v Calderbank [1975] 3 All ER 333
Hazeldene's Chicken Farm Pty Ltd v Victorian WorkCover Authority (No.2) [2005] VSCA 298; (2005) 13 VR 435
Miwa Pty Ltd v Siantan Properties Pte Ltd (No 2) [2011] NSWCA 344
Tati v Stonewall Hotel Pty Ltd (No 2) [2012] NSWCA 124
Vasilis Floros Moshos v Kenneth Geoffrey French (No.2) [2014] NSWSC 862
Category: Costs
Parties:
Vasilis Floros Moshos (plaintiff)
Kenneth Geoffrey French (first defendant)
Local Appliance Rentals Pty Ltd (second defendant)
Representation: Solicitors: Kings Law Group (plaintiff)
Kosmin & Associates (defendants)

File Number(s): 2013/290093
Publication restriction: Nil

Judgment

On 27 June 2014, the Court rejected the plaintiff's claim that he made a binding contract with the first defendant concerning the shares in a company that was to be incorporated to carry on a household rental goods business (see Vasilis Floros Moshos v Kenneth Geoffrey French(No.2) [2014] NSWSC 862). The Court answered certain separate questions accordingly, and directed the parties to bring in Short Minutes to deal with any further orders for the disposition of the proceedings, and costs.

The parties agree that an order should be made dismissing the proceedings, but are at odds on the question of costs. The parties have provided written submissions on the issue, and have agreed that it may be dealt with on the papers. Submissions were provided by the defendants on 19 September 2014 and 9 October 2014 (in reply), and by the plaintiff on 2 October 2014.

In summary, the defendants seek an order that some of their costs be paid on an indemnity basis due to the failure of the plaintiff to accept an offer contained in a Calderbank letter. The plaintiff resists that, and further submits that the defendants ought not have the costs of an affidavit sworn by the first defendant, Mr French, on 19 February 2014, and ought to pay the costs of this costs application.

The Calderbank letter was sent by email on 11 April 2014 to the plaintiff, who was then unrepresented in the proceedings. The letter is in the following terms:

"We refer to the above matter and note that your evidence is complete. Based on the evidence served on behalf of the plaintiff, and in accordance with advice from Counsel briefed to appear at the hearing on behalf of the defendants, the plaintiff's claim appears to be unsupported by the totality of the evidence to date.

In order to facilitate a resolution of the dispute without recourse to a hearing and on the basis that our clients take a commercial view of the matter, we are instructed to…

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: [2014] NSWSC 1417
Decision Date: 15 October 2014

CaseChat Overview and Summary

Moshos v French (No. 3) was a legal dispute between Moshos, the plaintiff, and French, the defendant, that was heard by the Supreme Court of Victoria. The matter related to indemnity costs incurred by the plaintiff after making a Calderbank offer that was not accepted by the defendant. The plaintiff sought an order for indemnity costs, arguing that the defendant's refusal to accept the offer was unreasonable.

The court was required to determine whether it was unreasonable for the plaintiff not to accept the defendant's Calderbank offer. A Calderbank offer is an offer made by a party to settle a case on terms that include an agreement by the other party to pay the costs of the offeror up to the date of the offer if the offer is not accepted and the offeror is not more successful at trial. The court had to weigh the factors that influenced the plaintiff's decision not to accept the offer and assess whether the plaintiff's decision was reasonable in the circumstances.

In its reasoning, the court considered the nature of the Calderbank offer and the circumstances surrounding the plaintiff's decision not to accept it. The court found that the plaintiff's decision not to accept the offer was reasonable, given the strength of their case and the potential for a more favourable outcome at trial. The court emphasised the importance of the offeror's discretion in deciding whether to accept a Calderbank offer, and that the offeree cannot unilaterally determine the terms of the offer. The court ultimately ruled in favour of the plaintiff, awarding indemnity costs.

The final orders of the court included an award of indemnity costs to the plaintiff, Moshos. The court found that the plaintiff's decision not to accept the defendant's Calderbank offer was reasonable, and that the defendant should be liable for the plaintiff's costs up to the date of the offer. The court's decision highlighted the importance of the offeror's discretion in deciding whether to accept a Calderbank offer and the need for careful consideration of the factors that influence such decisions.

Orders