Yakou v Jo-Yo Nominees Pty Ltd (No 2)
[2025] VSC 87
•11 March 2025
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
PERSONAL INJURIES LIST
S ECI 2021 02848
BETWEEN:
| EWAN YAKOU | Plaintiff |
| and | |
| JAMAL YOUNAN | First Defendant |
| and | |
| JO-YO NOMINEES PTY LTD (ACN 154 299 813) | Second Defendant |
| and | |
| GENESIS INTERNATIONAL (AUST) PTY LTD (ACN 130 479 104) | Third Defendant |
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JUDGE: | O’Meara J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 28 February 2025 |
DATE OF JUDGMENT: | 11 March 2025 |
CASE MAY BE CITED AS: | Yakou v Jo-Yo Nominees Pty Ltd & Ors (No 2) |
MEDIUM NEUTRAL CITATION: | [2025] VSC 87 |
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COSTS – Special costs order sought – Calderbank letter at the end of the first day of trial – Court’s discretion – Whether offer rejected unreasonably in all the circumstances – ‘Demand to capitulate’ left open for a short time – Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) (2005) 13 VR 435 considered – No special costs order made.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | P Haddad | Bowman & Knox Lawyers |
| For the First Defendant | No appearance | |
| For the Second Defendant | M Cameron | Moray & Agnew Lawyers |
| For the Third Defendant | M Cameron | Moray & Agnew Lawyers |
HIS HONOUR:
On 28 February 2025, I delivered reasons for judgment in respect of the plaintiff’s liability case against the second and third defendants.[1]
[1]Yakou v Jo-Yo Nominees Pty Ltd & Ors [2025] VSC 58.
It is common ground that it should be ordered that the plaintiff’s claim against the second and third defendants is dismissed.
Upon the publication of reasons for judgment, counsel for the second and third defendants applied for a special costs order arising out of the failure by the plaintiff to accept an offer set out in a Calderbank letter emailed at 4:13pm on the first day of trial.
The letter was marked ‘without prejudice save as to costs’ and stated, relevantly, as follows –
1.The trial of this matter which commenced on 22 October 2024 is proceeding in respect of liability only.
2.We consider that the expert evidence of Mr Smith that the security arrangements in place on the night in question were reasonable taking into account the nature of the event being held, will be preferred over that of Dr Zalewski.
3.The second defendant and the third defendant remain of the view that they will successfully defend the action brought against them by the plaintiff.
4.We are instructed to advise that the second defendant and third defendant are prepared to bear their own costs to date on the basis that the plaintiff’s proceedings against them is dismissed and he bears his own costs to date (the offer).
5.The offer remains open for the plaintiff’s acceptance until 10.30 am on Wednesday 23 October 2024.
6.We advise that should the above offer not be accepted and the proceeding continues to trial and your client fails to obtain judgment more favourable than the offer made, then this letter shall be used on the issue of costs with an application being made for costs on a solicitor and client basis from the date of this letter in accordance with the principles applied in the Court of Appeal decisions in Hazeldene’s Chicken Farm Pty Limited v VWA (No. 2) [2005] VSCA 298 and Settlement Group Pty Limited v Purcell Partners (No.2) [2014] VSCA 68.
7.If any aspect of the offer is unclear, please seek clarification prior to the expiration of the offer.
The events of the first day of the trial are referred to in the principal reasons for judgment. Among other things, several applications were determined, including the granting of leave to the plaintiff for the late service of subpoenas on Naje Koru and Floran Hanna, who were both later called to give evidence in the plaintiff’s case. At the point at which the Calderbank letter was emailed, the plaintiff was in the midst of his evidence-in-chief.
Following the application made by counsel for the second and third defendants, counsel for the plaintiff sought time to consider and then discuss the position with counsel for the second and third defendants.
In the circumstances, I directed that short written submissions be exchanged if the issue was not able to be resolved. In that event, the application would be determined on the papers and final orders made.
The plaintiff and second and third defendants each later filed and served short written submissions.
Various different policy considerations bear upon the determination of an application of the present kind, and there is no exhaustive list of relevant considerations bearing upon the exercise of the Court’s discretion. The critical issue is whether, in all the circumstances, the Calderbank offer was rejected unreasonably.[2]
[2]Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) (2005) 13 VR 435 (‘Hazeldene’s Chicken Farm’), [23].
In Hazeldene’s Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) (‘Hazeldene’s Chicken Farm’),[3] the Court of Appeal (Warren CJ, Maxwell P and Harper AJA) stated that such an application should ordinarily be considered with regard to at least the following –
[3]Ibid.
(a) the stage of the proceeding at which the offer was received;
(b) the time allowed to the offeree to consider the offer;
(c) the extent of the compromise offered;
(d) the offeree’s prospects of success, assessed as at the date of the offer;
(e) the clarity with which the terms of the offer were expressed;
(f)whether the offer foreshadowed an application for an indemnity costs [order] in the event of the offeree’s rejecting it.[4]
[4]Hazeldene’s Chicken Farm (n 3) [25].
In respect of (e) and (f) above, the present offer was in clear terms and foreshadowed the current application.
That said, the Calderbank letter was sent at the end of the first day of trial, at which point, as I have indicated, the plaintiff –
(a) was in evidence-in-chief; and
(b) had recently been granted leave to subpoena two important witnesses (who, I would infer, were later to be called essentially ‘cold’).
In that context, the letter drew attention to the anticipated conflict between the evidence of Mr Smith and Dr Zalewski and, obviously, said that the former would be preferred over the latter.
However, at that point, there must have been many unknowns and imponderables beyond the anticipated conflict between the evidence of Mr Smith and Dr Zalewski. Issues of credit and reliability must have loomed in respect of at least some of the witnesses under consideration, including the plaintiff. In the end, those issues were said to loom with every witness called in the case (by both sides).
Even if such issues could have been anticipated to affect some parts, or even all, of the evidence of Dr Zalewski (and the letter did not say that), I do not think that it could have been said, at that point, that the plaintiff’s case was entirely without prospects of success (and the letter did not say that either). Even though the case plainly faced significant difficulties, other evidence might have been anticipated to carry the day (although, of course, that did not ultimately occur).[5]
[5]In this connection, the written submissions of the second and third defendants dated 5 March 2025 describe the plaintiff as having had ‘low prospects of succeeding in his claim’.
Further, the most important evidence was the various videos and Camera 16 footage, but the letter said nothing about that anticipated evidence at all (particularly, the One second video).
In that sense, the letter –
(a) drew attention to only one aspect of what should have been anticipated to be a very complicated evidentiary landscape; and
(b) otherwise said that the second and third defendants would be successful.
In that context, of course, the offer was left open for only a very short period of time – that is, until 10.30am on the morning after it was served. In the circumstances to which I have referred, I doubt that the offer could have been given any real or detailed consideration in the time available.[6]
[6]Cf Lonergan v Trustees of the Sisters of Saint Joseph & Anor (Costs Ruling) [2021] VSC 717.
Importantly, while the offer cannot be said to have offered no degree of compromise, the reality is that in this area of litigation an offer to ‘walk away’ often amounts to no more than a ‘demand to capitulate’.[7] While each case falls to be considered in all of the relevant circumstances, I would characterise the present offer in those terms.
[7]Berrigan Shire Council v Ballerini (No 2) [2006] VSCA 65, [15], [17] and Di Falco v Emirates (No 3 – Costs ruling) [2019] VSC 732, [20].
In short, in respect of the other considerations identified in Hazeldene’s Chicken Farm –
(a) the offer was made at the end of the first day of trial and at a point at which the plaintiff’s case was likely in a state of significant flux;
(b) the time allowed for consideration of the offer was very short and unlikely to have permitted any detailed consideration of the various factors bearing upon the issue (which went well beyond the limited matters referred to in the letter);
(c) the offer was, in reality, a demand to capitulate; and
(d) at that point, while the plaintiff’s case plainly faced significant difficulties, I do not think that it could then have been said that it was entirely without prospects of success.
Otherwise, in the present case, the various policy and other considerations do not seem to me to pull in any particular direction.
In the circumstances, I do not consider that it was unreasonable for the plaintiff not to have accepted the offer made in the Calderbank letter dated 22 October 2024.
More broadly, the application of the second and third defendants for a special costs order must be rejected.
Final orders disposing of the proceeding will accompany these reasons.
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