Redrouge Nominees Pty Ltd v Canberra Institute of Technology (No 2)

[2025] ACTSC 27

SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Case Title: 

Redrouge Nominees Pty Ltd v Canberra Institute of
Technology (No 2)

Citation: 

[2025] ACTSC 27

Hearing Date: 

On the papers

Decision Date: 

12 February 2025

Before: 

Mossop J

Decision: 

(1)	Orders 2 and 3 made on 15 November 2024 are vacated.
(2)	The defendant is to pay the plaintiff’s costs of the

proceedings:

(a)	assessed on a party and party basis up to 25 October 2024; and
(b)	assessed on a solicitor and client basis from

26 October 2024.

Catchwords:	PRACTICE AND PROCEDURE – COSTS – Where offers of
compromise made by plaintiff, not accepted and no less
favourable judgment sum obtained – whether costs should be apportioned due to plaintiff’s lack of success on aspect of argument – whether offer open for period not reasonable in the circumstances – no reason to depart from costs provisions of the
Court Procedures Rules on facts
Legislation Cited:	Court Procedures Rules 2006 (ACT), rr 1002(2), 1009(2), 1010, Pt 2.10
Cases Cited:	Findex Group Pty Ltd v McKay (No 2) [2023] ACTCA 43
Redrouge Nominees Pty Ltd v Canberra Institute of Technology
[2024] ACTSC 362 Singh v Cooper (No 2) [2015] ACTSC 368
Parties:	Redrouge Nominees Pty Ltd trading as Think Garden (Plaintiff)
Canberra Institute of Technology (Defendant)
Representation:	Counsel
JC Giles SC with BJS Smith (Plaintiff) A Berger KC with J Cunliffe (Defendant)
Solicitors
Bennett Litigation and Commercial Law (Plaintiff) ACT Government Solicitor (Defendant)
File Number:	SC 39 of 2023
MOSSOP J:
1․	On 15 November 2024, I gave judgment for the plaintiff in the sum of $2,402,002:
Redrouge Nominees Pty Ltd v Canberra Institute of Technology [2024] ACTSC 362. I
ordered that the defendant was to pay the plaintiff’s costs, but gave the parties an
opportunity to be further heard in relation to costs. The plaintiff gave notice that it sought
a different order for costs. It made submissions relying upon both offers of compromise
under the Court Procedures Rules 2006 (ACT) (‘the Rules’), as well as a Calderbank
offer. It sought an order that costs from 23 October 2024 be assessed either on an
indemnity or a solicitor and client basis. In response to the application, the respondent
opposed such an order and submitted that the defendant should be ordered to pay only
75% of the plaintiff’s party and party costs.
2․	There was no objection to any of the affidavit material relied upon and it is admitted into
evidence.
3․	Although the plaintiff made both offers of compromise and a Calderbank offer, for the
reasons that follow, it is only necessary to address the Rules-based offer.
4․	The final hearing occurred on 28 and 29 October 2024. On 15 October 2024 (well after
the close of business), the plaintiff served an offer of compromise under the Rules. The
offer of compromise offered to settle the proceedings on the basis that the defendant
consented to judgment being entered for the plaintiff in the amount of $2,200,000. The
letter indicated that it was open for acceptance until 4pm on 23 October 2024, and that
it was made pursuant to Part 2.10 of the Rules. The letter pointed out the costs
consequences of acceptance of the offer under r 1009(2).
5․	The amount recovered by the plaintiff in the proceedings exceeded the offer of
compromise by $202,002.
6․	The effect of r 1010(2) is that “unless the court orders otherwise”, the plaintiff is entitled
to an order for costs on a solicitor and client basis “from the day the period for acceptance
of the offer ends”.
7․	The defendant submitted that the plaintiff was unsuccessful with its primary argument
that it was entitled to the full contract price: see Redrouge at [70]. This was said to be a
matter which raised issues which were “separate and discrete” and therefore fell within
the circumstances in which it may be appropriate to apportion costs: see Findex Group
Pty Ltd v McKay (No 2) [2023] ACTCA 43 at [6]. The defendant submitted that an
apportionment should be made such that the defendant pay 75% of the plaintiff’s party
and party costs.
8․	I do not accept that this is a case in which such an apportionment is appropriate. There
were two discrete contractual arguments, one relying upon the terms of the contract, one
relying upon damages for repudiation. The argument based upon the terms of the
contract did not add to the factual issues in the case and only modestly increased the
written and oral submissions.
9․	The other argument put forward on behalf of the defendant was that the offer of
compromise was not open for a period that was reasonable under the circumstances.
The offer made on 15 October 2024 expired at 4pm on 23 October 2024. On
23 October 2024, the defendant requested an extension of the time for acceptance of
the offer until 25 October 2024. Although the original offer was not extended, and hence
lapsed, a further offer of compromise was made by the plaintiff in the same terms as the
original one on 24 October 2024. The further offer of 24 October 2024 expired at 4pm
on 25 October 2024.
10․	The defendant points to the plaintiff’s failure to comply with the court’s orders for the filing
of its written submissions by 14 October 2024. Those submissions were only served on
21 October 2024. The reason for the delay was that junior counsel for the plaintiff had
broken his foot the week before, and this provided an impediment to completing them in
the required time frame.

11․ The defendant submitted that the time permitted for acceptance of the offers of

compromise was unreasonable, having regard to the requirement to prepare its opening

written submissions as well as prepare for the hearing the following Monday. It submitted

that it was “an unreasonably short amount of time for a large, publicly accountable,

organisation to obtain advice and undertake the necessary internal steps to reach a

decision about the plaintiff’s offer – even if the two separate periods are combined”.

12․	The difficulty for the defendant’s submissions is that the additional time given by the
plaintiff through the making of the second offer was the additional amount of time that
had been requested by the defendant. If the defendant needed more time, it should have
said so. Further, there was no evidence to support the submission that there were
internal difficulties in relation to the defendant’s ability to consider an offer of settlement
which made it unreasonable to insist upon a decision in relation to the offer within the
specified period. The need for evidence to support such a submission is particularly
acute in a case like this where:

(a)	the proceedings were first before the court in April 2023;
(b)	there were only limited possible outcomes of the proceedings that needed to be

considered; and

(c) no evidence had been put on by the defendant to contradict the evidence of

Mr Giliberti quantifying damages arising from repudiation.

In those circumstances, it is hard to imagine that “a large, publicly accountable,

organisation” had not obtained clear advice as to the likely outcomes so as to enable it

to respond promptly to an offer that was made. If that was not the case, or there was

some impediment to decision-making, then that needed to be the subject of evidence.

13․	The final argument of the defendant was that the offer did not clearly identify the
proposed orders for disposal of the claim. I do not accept this submission. While it is
clearly desirable for offers of compromise (or indeed any offers to settle proceedings) to
set out the precise terms of the orders which are proposed to be made by the court, in
the present case the nature of the proceedings and the formulation of the offer was
sufficient to unambiguously identify the proposed orders for the disposal of the claim and
the amount of the judgment proposed for the purposes of rule 1002(2). The offer said,
“Think Garden is willing to settle the dispute the subject of the above proceedings on the
basis that CIT consents to judgment being entered for the plaintiff in the amount of
$2,200,000”. The costs consequences under r 1009(2) were pointed out. No relevant
uncertainty is pointed out either in evidence or in submissions.
14․	For these reasons, it is not appropriate for the court to “order otherwise” and, as a result,
the costs consequences specified in r 1010 apply. Under r 1010(2), solicitor and client
costs are payable “from the day the period for acceptance of the offer ends”. I interpret
“from” as being “after” rather than “from and including”. That gives effect to the notion
that if the offer had been accepted then costs on the subsequent days would have been
avoided. In a context in which, in substance although not in form, the offer of compromise
was extended until 25 October 2024, costs on a solicitor and client basis should be
awarded from 26 October 2024. To the extent that this outcome might not give full effect
to the Rules in relation to the operation of the first offer of compromise, I will depart from
the effect of the Rules.
15․	Insofar as the plaintiff sought costs on an indemnity basis, that is an outcome not
provided for by the Rules relating to offers of compromise. Given the relationship
between offers of compromise and Calderbank offers, no more favourable consequence
should flow from a Calderbank offer than from an offer of compromise: Singh v Cooper
(No 2) [2015] ACTSC 368 at [30]-[32]. There are no other circumstances which would
warrant the making of an order on an indemnity basis.
16․	Having regard to the success of the plaintiff in its claim based upon the offer of
compromise, it is not necessary to consider further the claim based on the Calderbank
offer.
17․	The orders of the Court are:

(1)	Orders 2 and 3 made on 15 November 2024 are vacated.
(2)	The defendant is to pay the plaintiff’s costs of the proceedings:

(a)	assessed on a party and party basis up to 25 October 2024; and
(b)	assessed on a solicitor and client basis from 26 October 2024.

I certify that the preceding seventeen [17] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Justice Mossop.

Associate:

Date: