WAM Active Limited v Keybridge Capital Limited (No 3)

The case of WAM Active Limited v Keybridge Capital Limited (No 3) involved a dispute between two companies, WAM Active Limited and Keybridge Capital Limited, concerning a complex series of transactions and the associated legal liabilities. The case was heard in the Supreme Court of New South Wales. The primary issue in the case was whether the successful party, WAM Active Limited, was entitled to indemnity costs from Keybridge Capital Limited due to a failure on a separable issue, despite being successful overall.

The court was tasked with determining whether the general rule that costs follow the event applied in this case, and if so, whether any exceptions could be made in light of the successful party's failure on a separable issue. Additionally, the court had to assess whether there were any grounds for awarding indemnity costs to WAM Active Limited. The court considered the precedent set by previous cases and the principles established in relation to costs in litigation.

In its decision, the court held that while the general rule is that costs follow the event, there are circumstances where the court may exercise its discretion to award indemnity costs. However, in this case, the court found that WAM Active Limited's failure on a separable issue did not warrant an award of indemnity costs. The court reasoned that the failure did not significantly impact the overall outcome of the case and that the award of indemnity costs should only be considered in exceptional circumstances. Consequently, the court dismissed Keybridge Capital Limited's application for indemnity costs.

The final orders of the court were that WAM Active Limited was entitled to its costs of the proceeding, but that Keybridge Capital Limited was not required to pay indemnity costs to WAM Active Limited. This decision underscores the importance of the discretion of the court in determining costs and the limited circumstances in which indemnity costs may be awarded.