Wirepa v Hill (No. 2)

In the case of Wirepa v Hill (No. 2), the dispute arose from the plaintiff’s attempt to enforce an order for indemnity costs against the defendant. The plaintiff had initiated proceedings, which were ultimately dismissed, and the defendant was awarded costs on the ordinary basis. The plaintiff sought to challenge this order, arguing that the dismissal should be on indemnity terms due to the defendant’s conduct during the litigation. The court had to decide whether the plaintiff’s proceedings should be dismissed on indemnity costs terms, and if so, whether certain procedural requirements imposed on the plaintiff were enforceable.

The primary legal issue was whether the plaintiff’s conduct justified an order for indemnity costs, particularly in light of the two Calderbank letters served. The first Calderbank letter did not include any conditions that would render it ineffective, while the second stipulated that any settlement would be confidential and that the plaintiff would not disparage the defendant. The court had to assess the effectiveness of these letters in the context of the plaintiff’s pursuit of indemnity costs. Additionally, the court needed to determine whether the procedural requirements imposed on the plaintiff, as part of the stay of the dismissal order, were reasonable and enforceable.

The court found that the second Calderbank letter, which contained conditions regarding confidentiality and non-disparagement, was likely to be ineffective and could not be relied upon to support the plaintiff’s claim for indemnity costs. Consequently, the court dismissed the plaintiff’s application for indemnity costs. The procedural requirements imposed on the plaintiff were deemed reasonable, but the plaintiff’s failure to comply with these requirements resulted in the dismissal of the proceedings. The court concluded that the plaintiff's conduct did not warrant an indemnity costs order and dismissed the proceedings with the costs order remaining on the ordinary basis.

The court made orders dismissing the plaintiff’s proceedings with costs on the ordinary basis. The stay previously granted was lifted due to the plaintiff's non-compliance with the procedural requirements. The court's decision underscored the importance of adhering to procedural obligations and highlighted the limitations of Calderbank letters in securing indemnity costs in such circumstances.