S.H.A. Premier Constructions Pty Ltd v Niclin Constructions Pty Ltd (No 2)

S.H.A. Premier Constructions Pty Ltd, the applicant, brought an application against Niclin Constructions Pty Ltd, the first respondent, in the Supreme Court of New South Wales. The dispute involved the assessment of costs following an unsuccessful attempt by the applicant to have an offer made by the first respondent deemed reasonable under the principles of Calderbank. The first respondent had made an offer of compromise in writing, known as a Calderbank offer, which the applicant did not accept within the stipulated time. The applicant's reasons for rejecting the offer were considered inadequate, and the offer had been open for acceptance for less than 75 hours.

The central legal issue before the court was whether the applicant's decision not to accept the Calderbank offer was reasonable. This involved examining the adequacy of the reasons provided by the applicant for rejecting the offer, as well as the time frame within which the offer was open. The court had to determine if the applicant's actions constituted an unreasonable refusal of the offer. The court considered the principles of proportionality and fairness in assessing whether the applicant's conduct was justifiable.

In delivering the judgment, the court found that the applicant's reasons for rejecting the Calderbank offer were inadequate, and the offer had been open for acceptance for a very short period. The court concluded that the applicant acted unreasonably in not accepting the offer. The court ordered the applicant to pay the first respondent's costs of and incidental to the application, to be assessed on the standard basis. This decision underscored the importance of providing adequate reasons for rejecting a Calderbank offer and the potential consequences of unreasonable refusals.