Peter Willis v Health Communications Network Ltd (No 2)

The appeal concerned the appropriate orders for costs in proceedings between Peter Willis (the appellant) and Health Communications Network Ltd (the respondent) in the District Court and on appeal. The dispute involved claims made by the appellant against the respondent, and the court was required to determine the basis upon which costs should be awarded, particularly in light of settlement offers made during the litigation.

The primary legal issues before the court were whether the respondent's refusal of a settlement offer made by the appellant was unreasonable, thereby justifying an award of indemnity costs against the respondent, and conversely, whether the appellant's conduct warranted an award of indemnity costs against him. The court also had to consider the apportionment of costs between the parties, both in the first instance proceedings and on appeal, and how to address situations where an offer of compromise was made and subsequently refused.

The court reasoned that the appellant's offer of compromise, while not accepted, was not so unreasonable as to warrant an award of indemnity costs against the respondent. However, the court found that the respondent's conduct after a certain point in the proceedings, particularly in relation to its own settlement offers and the overall conduct of the litigation, justified a departure from ordinary costs. Consequently, the court ordered that the appellant pay 80% of the respondent's costs in the District Court on an ordinary basis up to 23 June 2006, and on an indemnity basis thereafter. The respondent was ordered to pay 20% of the appellant's costs on an ordinary basis, with the costs to be set off. Similar orders were made for the costs of the appeal, with the appellant to pay 80% of the respondent's costs on an ordinary basis and the respondent to pay 20% of the appellant's costs on an indemnity basis, also to be set off.