The Agency Group Australia Ltd v H.A.S Real Estate Pty Ltd (No 2)

The Agency Group Australia Ltd, as the appellant, sought to challenge the costs order made in the Federal Court, with H.A.S Real Estate Pty Ltd, the respondent, defending the costs order. The dispute centred on the assessment of costs on an indemnity basis and the refusal to apportion costs based on the parties' success or failure on certain issues. The matter was heard and determined by the Full Court of the Federal Court of Australia.

The primary legal issues in the case were whether the appellant's failure to accept an offer of compromise was unreasonable, particularly when the offer included payment of costs other than legal costs, and whether the costs should be apportioned considering the parties' success or failure on certain issues. The court was required to determine whether the costs should be awarded on a party and party basis without apportionment, given that the rejection of the offer was not unreasonable.

The court concluded that the appellant's rejection of the offer of compromise was not unreasonable, and therefore, the costs should not be apportioned based on the parties' success or failure on specific issues. The court held that the costs should be awarded on a party and party basis without apportionment. Consequently, the respondent's application for its costs of the appeal to be assessed on an indemnity basis was refused, and the costs of the appeal were to be paid on a lump sum basis. The court also ordered that the question of the costs of any assessment pursuant to Order 4 be reserved for determination by the Registrar.

In conclusion, the Full Court of the Federal Court of Australia determined that the costs should not be apportioned due to the appellant's rejection of the offer of compromise, which was not unreasonable. The court awarded the costs on a party and party basis without apportionment, and the respondent's application for indemnity costs was refused. The costs of the appeal were to be paid on a lump sum basis, with the sum to be assessed and quantified by a Registrar. The question of the costs of any assessment was reserved for the Registrar's determination.