Noon v Bondi Beach Astra Retirement Village Pty Ltd (No 2)
[2010] NSWCA 285
•2 November 2010
New South Wales
Court of Appeal
CITATION: Noon & Anor v Bondi Beach Astra Retirement Village Pty Ltd & Anor (No 2) [2010] NSWCA 285 HEARING DATE(S): On written submissions
JUDGMENT DATE:
2 November 2010JUDGMENT OF: Giles JA; Macfarlan JA; Young JA DECISION: Notice of motion dismissed with costs. CATCHWORDS: COSTS - indemnity costs - Calderbank letter - reasonableness of rejection - offeree successful below - reasoning of judges in Court of Appeal differed although result agreed - reasonableness not determined with hindsight - not unreasonably rejected. CASES CITED: East West Airline Ltd v Turner (No 2) [2010] NSWCA 159;
Gretton v Commonwealth of Australia [2007] NSWSC 149;
Herning v GWS Machinery Pty Ltd (No 2) [2005] NSWCA 375;
Jones v Bradley (No 2) [2003] NSWCA 258;
Leichhardt Municipal Council v Green [2004] NSWCA 341;
SMEC Testing Services Pty Ltd v Campbelltown City Council [2000] NSWCA 323.PARTIES: Gregory Brian Noon (Co-Executor of the Estate of the Late Brian Robert Noon) - First Appellant
Matthew Jack Noon (Co-Executor of the Estate of the Late Brian Robert Noon) - Second Appellant
Bondi Beach Astra Retirement Village Pty Ltd - First Respondent
C G Maloney Pty Ltd - Second RespondentFILE NUMBER(S): CA 2009/298339 COUNSEL: M J Darke - Appellants
R J Brender - RespondentsSOLICITORS: Gilbert + Tobin - Appellants
Stephen Wawn & Associates - RespondentsLOWER COURT JURISDICTION: Supreme Court LOWER COURT FILE NUMBER(S): SC 5436/06 LOWER COURT JUDICIAL OFFICER: Smart AJ LOWER COURT DATE OF DECISION: 2 June 2009
CA 2009/298339
SC 5436/06Tuesday 2 November 2010GILES JA
MACFARLAN JA
YOUNG JA
1 THE COURT: The Court gave judgment on 19 August 2010. The appeal was successful, and it was ordered that the respondents pay the appellants’ costs both of the trial and of the appeal.
2 By notice of motion filed on 2 September 2010 the appellants applied for an order that the respondents pay their costs of the trial from 30 November 2007 on an indemnity basis. Written submissions were directed, and were received.
3 The respondents or one of them claimed to enforce an option to repurchase a unit in a retirement village. The appellants were the executors of the deceased unit-holder. Smart AJ upheld the claim.
4 From shortly after the proceedings were brought, there was a series of offers and counter-offers involving payment by the appellants to the respondents of a sum of money variously expressed as in settlement of the appellants’ claim or to obtain a buy back release. The appellants relied in their application on an offer made on 30 November 2007, in the terms that they “would be prepared to pay the sum of $200,000.00 to your client to obtain a buy back release”. Although not within the order claimed in the notice of motion, they proffered fall-back positions relying on subsequent offers of 4 February 2008, 15 February 2008 and 21 February 2008, each for a greater sum than $200,000 in return for a buy back release.
5 The November offer was the third in the series. It was rejected. The respondents made a counter-offer, which led in turn to the appellants’ February offers in a continuation of the exchanges of offers and counter offers.
6 None of the offers and counter-offers was an offer of compromise under the Rules. The November offer was not expressly noted “without prejudice save as to costs” or in similar manner. It was simply noted “without prejudice”. Two preceding offers by the appellants had been noted “without prejudice save as to costs”, and the counter-offer responding to the November offer was headed in that manner. In our opinion, the November offer should be regarded as a Calderbank offer.
7 With the appellants’ success on appeal, the respondents’ claim has failed and the appellants do not need to obtain a buy back release. The appellants have obtained a result more favourable than the November offer. Was it unreasonable, in all the circumstances, for the respondents not to have accepted the November offer (SMEC Testing Services Pty Ltd v Campbelltown City Council [2000] NSWCA 323; Jones v Bradley (No 2) [2003] NSWCA 258; Leichhardt Municipal Council v Green [2004] NSWCA 341; Herning vGWS Machinery Pty Ltd (No 2) [2005] NSWCA 375; East West Airline Ltd v Turner (No 2) [2010] NSWCA 159)?
8 We are not persuaded that it was unreasonable.
9 We do not accept the respondents’ submission that there was only an indication of the appellants’ intention, and not an offer capable of acceptance. We note, however, that the offer as stated did not deal with costs. It is not easy to construe the offer, as the appellants submitted, as an offer to pay $200,000 inclusive of costs in settlement of the proceedings; that is not what it says, nor is that necessarily the meaning to be given to it in the light of the preceding correspondence. Acceptance of the offer would not fully have resolved the proceedings, and what was involved in a buy back release may well have needed resolution.
10 However, of more importance is that the respondents were successful in their claim at first instance. There were contested issues of fact at trial, on which the respondent succeeded and which were not in issue on appeal. Of the issues on appeal, the members of this Court to some extent differed in dealing with them although in agreement on the result. There were difficult questions, of fact and law, and the respondents’ success at first instance makes it hard to contend that they unreasonably failed to accept the offer.
11 The appellants’ submissions amounted to little more than that their ultimate success meant that it was unreasonable for the respondents not to have accepted the offer. That is incorrect reasoning. Reasonableness is not to be determined with hindsight; rather, the strength or otherwise of the appellants’ claim should be considered prospectively as at the time of the offer (for example, Gretton v Commonwealth of Australia [2007] NSWSC 149 at [24]). A claimant can reasonably seek to have a claim determined in court, although ultimately it fails, rather than accept an offer of much less than that which success would bring. The appellants’ submissions did not descend to why, viewed prospectively, the offered $200,000 should have been accepted.
12 In our opinion, it has not been shown that it was unreasonable for the respondents not to accept the November offer. We do not think that the subsequent offers are in any better position.
13 The notice of motion is dismissed with costs.
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