Sammut v Paul Leroy as trustee of the Bankrupt Estates of Joanne De Rome and Geoffrey De Rome &; Ors (No 2)

This matter concerned an application for indemnity costs brought by the first and second respondents following earlier proceedings in the Federal Court of Australia before Judge Manousaridis. The applicant, Mr Sammut, had sought to recover assets from the bankrupt estates of Joanne and Geoffrey De Rome.

The primary legal issues before the Court were whether an offer of compromise made by the first respondent was a genuine offer for the purposes of awarding indemnity costs, and whether the claims made against the second respondent were so devoid of merit as to warrant an order for indemnity costs in their favour.

The Court found that the offer of compromise made by the first respondent, which proposed dismissal of the proceedings with the applicant paying three-quarters of the first respondent's costs, was a genuine offer. This was because it represented a realistic attempt to resolve the dispute. Furthermore, the Court determined that the claims brought against the second respondent were indeed hopeless, justifying an award of indemnity costs in their favour.

Consequently, the Court ordered that the applicant pay the costs of the first and second respondents on an indemnity basis.