TGM Civil Pty Ltd v Resourceco Pty Ltd (No 2)

The case of TGM Civil Pty Ltd v Resourceco Pty Ltd (No 2) involved a dispute between two companies, TGM Civil Pty Ltd and Resourceco Pty Ltd, with the matter being heard in the District Court of New South Wales. The central issue in the case was whether the plaintiff, TGM Civil Pty Ltd, should be ordered to pay the defendant's costs on an indemnity basis, rather than the usual solicitor/client basis. This decision hinged on the exceptional nature of the proceedings, the submission of a "Calderbank" letter by the defendant to the plaintiff's solicitors, and an offer to consent to judgment made by the plaintiff.

The court was required to consider the exceptional nature of the proceedings, which included prolonged and complex interlocutory disputes that ultimately resulted in the plaintiff's claims being dismissed. The "Calderbank" letter, sent by the defendant's solicitors to the plaintiff's solicitors on 18 December 2006, served to highlight the deficiencies in the plaintiff's case and the unlikelihood of its success. Furthermore, the plaintiff's offer to consent to judgment on 25 June 2007 was also considered, as it further demonstrated the plaintiff's lack of a reasonable prospect of success.

The court found that the plaintiff's case was fundamentally flawed, as it was based on a misunderstanding by the plaintiff's managing director and sole shareholder, Mr Morbidelli, of the relationships between various parties involved. Additionally, the plaintiff's evidence was not preferred over that of the defendant's witnesses. Given these factors, the court concluded that it was just and equitable to order that the award of costs in favour of the defendant be against the plaintiff, TGM Civil Pty Ltd, and its directors, Tonino Guiliano Morbidelli and Kirsten Jane Morbidelli, on an indemnity basis. This decision was made pursuant to section 42 of the District Court Act.