Pacific National Constructions Pty Ltd v Geurts Trucks Besloten Venootschap

The case of Pacific National Constructions Pty Ltd v Geurts Trucks Besloten Venootschap involved a dispute over costs incurred in an international commercial arbitration. The plaintiff, Pacific National Constructions, sought indemnity costs against the defendant, Geurts Trucks, following the arbitration. The matter was heard in the Supreme Court of New South Wales. The primary dispute centred on the enforceability of an exclusive jurisdiction clause in the contract between the parties and whether the usual order for costs in Australian courts should be displaced.

The legal issues before the court included whether the usual order for indemnity costs in Australian courts should apply and whether the absence of expert evidence presented by Pacific National Constructions warranted a deviation from this usual order. Additionally, the court had to consider the enforceability of the exclusive jurisdiction clause and its implications on the costs order.

The court held that the usual order for indemnity costs in Australian courts should not be displaced in this instance. It found that the absence of expert evidence did not justify a deviation from the usual order. The court emphasised that the absence of expert evidence could have been anticipated and planned for by the parties. Furthermore, the court concluded that the exclusive jurisdiction clause did not provide sufficient grounds to alter the usual order for costs. The court found that the clause did not inherently affect the principle of indemnity costs and that its enforceability did not impact the costs order.

As a result, the court determined that the usual order for indemnity costs would apply, and Pacific National Constructions would not be entitled to the costs it sought from Geurts Trucks. The court's decision underscores the importance of planning and the adherence to the usual order for indemnity costs in Australian courts, even in international commercial arbitration cases.