Cahill v Kenna (No 2) [2015] NSWSC 200

Cahill v Kenna (No 2) [2015] NSWSC 200

The 3 January 2013 offer did not justify indemnity costs because, at that time, evidence had not been served and the plaintiffs had valuation advice supporting their position, so LMW had not shown that rejection was unreasonable. The 20 October 2014 walk away offer was a genuine compromise because LMW would forgo substantial costs, the evidence was complete, the plaintiffs knew the serious weaknesses in their case, and their prospects were objectively very poor. It was therefore unreasonable not to accept that offer, but indemnity costs should run only from the offer's expiry, because the unreasonable non-acceptance was assessed when the offer could be seen not to have been accepted.

Jurisdiction
Australia
Judgment Date
17 March 2015
Procedural Posture
Costs Application / Post Judgment Application by Successful Defendants for Indemnity Costs, Heard on the Papers
Outcome
Costs order varied so that the plaintiffs pay the defendants' costs on the ordinary basis up to 30 October 2014 and, thereafter apart from the costs of the application, on the indemnity basis; plaintiffs also to pay one-half of the defendants' costs of the notice of motion on the ordinary basis.
Legal Topics
['indemnity Costs' 'calderbank Offers' 'walk Away Offer' 'reasonableness of Non Acceptance of Settlement Offer' 'expiry Date for Costs Consequences']
['costs' 'civil Procedure'] ['indemnity Costs' 'calderbank Offers' 'walk Away Offer' 'reasonableness of Non Acceptance of Settlement Offer' 'expiry Date for Costs Consequences']

Case Brief

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Procedural Posture

Costs Application / Post Judgment Application by Successful Defendants for Indemnity Costs, Heard on the Papers

Legal Issues

  1. 1 ["Whether the defendants' settlement offers were genuine Calderbank offers capable of attracting indemnity costs consequences." "Whether the plaintiffs' non-acceptance of the 3 January 2013 offer was unreasonable." "Whether the plaintiffs' non-acceptance of the 20 October 2014 walk away offer was unreasonable." 'Whether indemnity costs should run from the date of the offer or from the date of expiry of the offer.']

Ratio Decidendi

The 3 January 2013 offer did not justify indemnity costs because, at that time, evidence had not been served and the plaintiffs had valuation advice supporting their position, so LMW had not shown that rejection was unreasonable. The 20 October 2014 walk away offer was a genuine compromise because LMW would forgo substantial costs, the evidence was complete, the plaintiffs knew the serious weaknesses in their case, and their prospects were objectively very poor. It was therefore unreasonable not to accept that offer, but indemnity costs should run only from the offer's expiry, because the unreasonable non-acceptance was assessed when the offer could be seen not to have been accepted.

Court Disposition

Costs order varied so that the plaintiffs pay the defendants' costs on the ordinary basis up to 30 October 2014 and, thereafter apart from the costs of the application, on the indemnity basis; plaintiffs also to pay one-half of the defendants' costs of the notice of motion on the ordinary basis.

Orders

  • ['The costs order made on 10 December 2014 in proceedings 2012/198505 is varied by ordering that the plaintiffs pay the costs of the defendants on the ordinary basis up until 30 October 2014.' 'The plaintiffs pay the costs of the defendants thereafter, apart from the costs of this application, on the indemnity...