Prestige Residential Marketing Pty Ltd v Depune Pty Ltd (No 2)

In *Prestige Residential Marketing Pty Ltd v Depune Pty Ltd (No 2)*, the New South Wales Court of Appeal considered an appeal concerning the assessment of costs following earlier proceedings. The dispute revolved around the appropriate basis for awarding costs, specifically whether indemnity costs were warranted for certain aspects of the litigation.

The primary legal issue before the Court of Appeal was the interpretation and application of an offer of compromise made by Prestige Residential Marketing Pty Ltd (the appellant) to Depune Pty Ltd (the respondent) under the Uniform Civil Procedure Rules. The court was required to determine whether the respondent's failure to accept the offer of compromise justified an award of indemnity costs against the respondent for the period after the offer was made, and for the costs of proving certain facts and documents.

The Court of Appeal reasoned that the respondent's conduct in failing to accept the appellant's offer of compromise, which was more favourable than the ultimate judgment, warranted an award of indemnity costs for the period after the offer was made. The court applied the principles governing offers of compromise, which generally allow for indemnity costs to be awarded against a party who rejects an offer that is more advantageous than the final outcome. The court also considered the costs associated with proving specific facts and documents, finding that the respondent's failure to admit these justified an indemnity costs order for those specific costs.

The Court of Appeal varied the orders of the court below. It ordered that the respondent pay the appellant's costs of proving certain facts and documents on an indemnity basis. Furthermore, the respondent was to pay the appellant's costs of the proceedings below on the ordinary basis until 16 December 2005, and thereafter on an indemnity basis. The respondent was also ordered to pay the appellant's costs of the appeal on the ordinary basis. The court also made consequential orders regarding the overpayment of interest on the judgment sum.