Newstart Homes Australia Pty Ltd v Kodiak Concrete Pty Ltd (No 2)

The case of Newstart Homes Australia Pty Ltd v Kodiak Concrete Pty Ltd (No 2) was heard by the Supreme Court of New South Wales. The dispute between the parties centred on a winding up application brought by Newstart against Kodiak. Newstart sought to have Kodiak wound up based on a claimed debt, which Kodiak opposed on various grounds. The legal issues that the Court needed to decide included whether Newstart's winding up application constituted an abuse of process and, if so, whether indemnity costs should be awarded against Newstart. Additionally, the Court had to consider whether Newstart's refusal to accept two Calderbank offers from Kodiak was unreasonable, which would also justify an order for indemnity costs.

The Court found that Newstart's winding up application did constitute an abuse of process because Newstart had not established the amount payable as a liquidated debt under the subcontract when it served the statutory demand on Kodiak. Despite this, the Court concluded that Newstart did not know at the time it filed the winding up application that its conduct constituted an abuse of process. The Court also found that Newstart's unreasonable refusal of two Calderbank offers from Kodiak justified an order for indemnity costs. The first Calderbank offer was made before Newstart had received Kodiak's evidence and provided Newstart with only a few days to consider it. The second offer, which was more substantial and should have indicated to Newstart that its prospects of success were poor, remained open for a brief period.

In light of these findings, the Court ordered that Newstart pay Kodiak's costs of the winding up application from the date of the expiry of the second Calderbank offer on the indemnity basis. The Court concluded that from that date, Newstart's unreasonable attitude caused the application to continue, leading to Kodiak incurring further costs. The Court also ordered that Newstart pay Kodiak’s costs of and incidental to the proceeding to be assessed on the standard basis until 17 April 2024 and thereafter on the indemnity basis.