The Owners - Strata Plan No 68372 v Allianz Australia Insurance Limited (No 2)

In this case, the plaintiff, The Owners - Strata Plan No 68372, was involved in a legal dispute with the defendant, Allianz Australia Insurance Limited. The plaintiff sought damages for losses suffered due to alleged breaches of insurance policy obligations by the defendant. The dispute was heard in the Supreme Court of New South Wales. The primary focus of the litigation was the allocation of costs between the parties, with particular attention to the plaintiff's delay in joining a second defendant and the abandonment or failure of certain claims, as well as the preparation of expert reports that were ultimately not relied upon.

The court had to determine whether it was appropriate to depart from the general rule of costs following litigation, considering the plaintiff's delay in the proceedings. This included assessing the reasons for the delay and whether those reasons should influence the decision on whether to award interest on the costs. The court also needed to evaluate the appropriateness of costs being awarded as between the defendants, taking into account the unsuccessful or abandoned claims and the expert reports that were prepared but not utilised in the proceedings.

In its reasoning, the court found that the plaintiff's delay in joining the second defendant and the abandonment of certain claims warranted a departure from the usual costs order. The court emphasised that the reasons for the delay were relevant in determining whether to award interest on costs. It held that since the plaintiff's unexplained delays contributed to the overall costs, it was reasonable to award interest on those costs. The court also concluded that it was appropriate to order costs as between the defendants, reflecting the unsuccessful claims and the preparation of unused expert reports. This decision highlighted the importance of efficient conduct of litigation and the consequences of delays and inefficiencies.

The court ordered that Allianz Australia Insurance Limited was to recover costs from The Owners - Strata Plan No 68372 on an indemnity basis. Furthermore, it awarded interest on those costs, reflecting the plaintiff's unexplained delays. The court also directed that Allianz Australia Insurance Limited was to recover its costs from the second defendant, who had been joined late. This comprehensive approach to cost allocation underscored the need for timely and effective management of litigation to avoid unnecessary financial burdens.