Oz Cut Concrete Cutting Services v Shirlaw

Oz Cut Concrete Cutting Services was engaged by Shirlaw to complete concrete cutting work at a property. Following a dispute over payment, Oz Cut brought an action for recovery of the outstanding amount. The case settled before it went to trial, and Oz Cut applied for costs of the whole action. Shirlaw opposed this, arguing the costs should be limited to the point of settlement. The court was required to determine whether the costs should be awarded in full or limited to the period up until settlement, and if the usual rule applied or if there was an exception where one party would have clearly succeeded.

The court considered the circumstances of the settlement and the balance of advantage. It found that the settlement was not a result of a clear advantage to either party, but rather a pragmatic decision to avoid further litigation. The court noted that the usual rule is that the successful party is entitled to costs of the whole action. However, an exception to this rule applies when it is plain that one party would have succeeded had the matter been fully tried. The court held that in this case, it was not plain that Oz Cut would have succeeded, and therefore, the usual rule applied.

Accordingly, the court awarded Oz Cut costs of the whole action, as they were the successful party in the proceedings. The court emphasised that the exception to the usual rule does not apply lightly, and the circumstances must be clear. Here, the court found that the balance of advantage did not clearly favour Oz Cut, and thus the usual rule applied. The final orders included that Oz Cut recover its costs of the whole action from Shirlaw.