O'Brien v Cowie (No 2)

In the matter of O'Brien v Cowie (No 2), the primary issue before the court was the determination of costs following an offer of compromise made by the respondents. The applicants sought an indemnity costs order against the respondents, arguing that the respondents' offer was not genuine and was made in bad faith. The respondents, on the other hand, contended that the applicants were not entitled to indemnity costs and that the costs should be assessed on a standard basis.

The court was required to determine whether the default rule set out in rule 188F of the Supreme Court of Victoria Civil Procedure Act 2010 applied and, if so, whether there were exceptional circumstances that warranted displacing the default rule. The court also needed to assess whether the offer of compromise was genuine and made in good faith, and if the applicants had acted unreasonably in rejecting the offer. Additionally, the court considered the applicants' challenge to a decision in a prior case, Todorovic v Waller.

The court held that the respondents had not met the practical onus of proving that the default rule should be displaced. It was found that the offer of compromise was not made in bad faith and that the applicants had not acted unreasonably in rejecting the offer. As such, the court determined that the default rule applied, and the respondents were to pay the applicants' costs on an indemnity basis from a specified date. The court also noted that the parties were to bear their own costs in relation to the challenge to the decision in Todorovic v Waller.