Smits v Cugola and Ors

The case of Smits v Cugola and Ors involved the plaintiff, Smits, and the defendants, Cugola and others. The dispute centred around various applications for summary judgment and the removal of caveats, with the plaintiff’s applications being dismissed and the defendants' applications being successful, except for one part against the first defendant. The court was tasked with deciding whether a special order should be made to depart from the general rule that costs follow the event, particularly given the different results of the various applications and the proceeding. Additionally, the court considered whether the plaintiff’s rejection of a Calderbank offer was unreasonable and whether the costs of the third and fourth defendants, and the first and second defendants, should be assessed on an indemnity basis.

The court examined the principle that costs typically follow the event, but recognised that the outcomes on the different applications and the overall proceeding warranted a special order. The court also assessed the reasonableness of the plaintiff’s rejection of the Calderbank offer and the conduct of the plaintiff in bringing the claim against the first and second defendants. The first and second defendants argued that the plaintiff's conduct was irresponsible and entirely unreasonable. The court found that the plaintiff's rejection of the Calderbank offer was unreasonable, and the plaintiff's conduct in bringing the claim against the first and second defendants was also unreasonable.

The court ordered that the plaintiff pay the third and fourth defendants' costs on an indemnity basis, reflecting the unreasonable rejection of the Calderbank offer. The court further ordered the plaintiff to pay the second defendant's costs and 75 per cent of the first defendant’s costs associated with the applications. The costs of the applications heard and decided on 10 June 2021 were deemed to be costs in the proceeding unless otherwise specified. This decision underscores the importance of considering the reasonableness of conduct and offers in determining costs in civil proceedings.