Rahme v Benjamin & Khoury Pty Ltd (No 2)

In Rahme v Benjamin & Khoury Pty Ltd (No 2), the Court of Appeal of New South Wales considered appeals by Mrs Rahme and Mr Rahme against decisions of the primary judge concerning claims against Benjamin & Khoury Pty Ltd ("B&K") and Mr Dieb Khoury. The dispute involved claims arising from a joint venture and related equitable charges and costs agreements.

The primary legal issues before the Court of Appeal were whether Mrs Rahme's claim against B&K should have been dismissed, whether her claim against Mr Khoury was correctly rejected, and whether Mr Rahme's appeal should be dismissed. A significant aspect of the appeal also concerned the application of a *Calderbank* offer made jointly to both respondents and whether the unsuccessful respondent could have accepted it, and if so, whether they would have been in a better position had they accepted it compared to the outcome on appeal.

The Court of Appeal allowed the appeal in respect of the dismissal of Mrs Rahme’s claim against B&K, finding that the primary judge erred in dismissing this claim. However, the appeal concerning the rejection of Mrs Rahme’s claim against Mr Khoury was dismissed, as was Mr Rahme’s appeal. The Court set aside various judgments and orders from the court below, including the indemnity costs order and costs orders in caveat proceedings.

In lieu of the set-aside judgments, the Court of Appeal ordered that judgment be entered for Mrs Rahme against B&K in the sum of $302,040.30, and that certain deeds and a costs agreement between Mrs Rahme and B&K be set aside. B&K was ordered to pay the costs of Mrs Rahme (but not Mr Rahme) in the court below on the ordinary basis, and B&K was also ordered to pay the costs of Mrs Rahme in the Court of Appeal on the ordinary basis. No orders for costs were made in the Court of Appeal as between Mrs Rahme and Mr Khoury, or as between Mr Rahme, B&K, and Mr Khoury.