El Greco (Australia) Pty Ltd v Mediterranean Shipping Company SA [2003] FCA 747

El Greco (Australia) Pty Ltd v Mediterranean Shipping Company SA [2003] FCA 747

The proceeding involved important and reasonably complex questions and was properly brought in the Federal Court, so O 62 r 36A(1) should not reduce costs. The respondent's second offer, made after the Cocks affidavit and close to trial, was the relevant offer and substantially exceeded the judgment sum, so the ordinary party-and-party costs consequences of Order 23 applied after the relevant date. However, indemnity costs were not warranted because, although the insurer had been alerted to a value issue, its position on value was not so completely without foundation that rejection of the offer was capricious.

Jurisdiction
Australia
Judgment Date
17 July 2003
Procedural Posture
Federal Court Civil Proceeding Concerning Judgment and Costs / Reasons for Judgment and Orders on Costs After Offers of Compromise
Outcome
Judgment for the second applicant for $63,570 with interest from 17 April 2000; respondent to pay the second applicant's costs up to 28 November 2003; second applicant to pay the respondent's costs thereafter including the hearing costs.
Legal Topics
['offers of Compromise' 'indemnity Costs' 'party and Party Costs' 'reduction of Costs for Proceedings That Could Be Brought in Lower Courts' 'cargo Value']
['civil Procedure' 'costs' 'shipping'] ['offers of Compromise' 'indemnity Costs' 'party and Party Costs' 'reduction of Costs for Proceedings That Could Be Brought in Lower Courts' 'cargo Value']

Case Brief

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Procedural Posture

Federal Court Civil Proceeding Concerning Judgment and Costs / Reasons for Judgment and Orders on Costs After Offers of Compromise

Legal Issues

  1. 1 ['Whether the costs recovered by the applicant should be reduced under O 62 r 36A(1).' "What costs order should be made given the respondent's offers of compromise on 9 October 2002 and 27 November 2002, both substantially in excess of the sum recovered." 'Whether costs should be ordered on an indemnity basis because the offer was rejected and the proceeding continued.']

Ratio Decidendi

The proceeding involved important and reasonably complex questions and was properly brought in the Federal Court, so O 62 r 36A(1) should not reduce costs. The respondent's second offer, made after the Cocks affidavit and close to trial, was the relevant offer and substantially exceeded the judgment sum, so the ordinary party-and-party costs consequences of Order 23 applied after the relevant date. However, indemnity costs were not warranted because, although the insurer had been alerted to a value issue, its position on value was not so completely without foundation that rejection of the offer was capricious.

Court Disposition

Judgment for the second applicant for $63,570 with interest from 17 April 2000; respondent to pay the second applicant's costs up to 28 November 2003; second applicant to pay the respondent's costs thereafter including the hearing costs.

Orders

  • ['There be judgment for the second applicant in the sum of $63,570 together with interest from 17 April 2000.' "The respondent pay the second applicant's costs up to 28 November 2003." "The second applicant pay the respondent's costs of the proceeding thereafter including the costs of the hearing today."]