Stateland Developments Pty Ltd v Princi

Stateland Developments Pty Ltd sought a determination on the costs of a proceeding against Princi, which had been settled before a hearing on the merits. The question before the court was whether it should entertain a shadow hearing of issues on an application for costs. The case raised issues of the appropriate principles to apply in determining costs in circumstances where a proceeding is settled before a hearing on the merits. The court held that a shadow hearing was not appropriate in this instance. It noted that the primary consideration in determining costs in such circumstances was whether the proceeding was brought or defended without real prospects of success or for an improper purpose. The court found that the proceeding was not brought or defended without real prospects of success or for an improper purpose. The court further held that the principles to be applied in determining costs in such circumstances were those set out in the case of North v Motor Accidents Authority [2001] NSWCA 136. The court ordered that the proceeding be settled on terms to be agreed between the parties or, failing agreement, to be determined by the court. The court further ordered that the parties bear their own costs of the proceeding, to be taxed if necessary.