Tipto Pty Ltd v Yuen (No 2)

In the case of Tipto Pty Ltd v Yuen (No 2), the plaintiffs sought to recover costs from the defendants. The plaintiffs had made baseless demands and threats against the defendants, but ultimately did not seek such relief. The court was required to decide whether the defendants were entitled to indemnity costs given the plaintiffs' unreasonable conduct. The court also considered whether it was unreasonable for the plaintiffs to reject the defendants' settlement attempts, particularly their Calderbank offer. The court found that the plaintiffs' rejection of the offer was not unreasonable as it did not deal with the principal relief sought by the plaintiffs. The court further considered whether the plaintiffs' misconduct justified more onerous costs orders against them. The court held that the plaintiffs' conduct unnecessarily prolonged the hearing and increased costs, and therefore ordered the plaintiffs to pay 85% of the defendants' reasonable solicitor/client costs.

The court held that while the plaintiffs' conduct was unreasonable, it was not sufficiently connected with the litigation itself to justify indemnity costs. The court found that the plaintiffs' rejection of the defendants' settlement attempts was not unreasonable, particularly in light of the fact that the Calderbank offer did not relate closely enough to the relief sought by the plaintiffs. The court considered that the plaintiffs' misconduct in pressing baseless claims unnecessarily prolonged the hearing and increased costs. The court held that the plaintiffs should pay 85% of the defendants' reasonable solicitor/client costs, but did not deem it appropriate to impose more onerous costs orders against them.