Midcoast Petroleum Pty Ltd v Keldros Pty Ltd (No 2) [2019] NSWSC 1406

Midcoast Petroleum Pty Ltd v Keldros Pty Ltd (No 2) [2019] NSWSC 1406

The Calderbank offer contained a genuine element of compromise and was more favourable to Midcoast than the judgment ultimately obtained. While the offer remained open, Midcoast had the defendants' expert and affidavit evidence showing real contests on liability and quantum, including contamination and make good issues, and had almost two weeks after service of that evidence to assess the offer. In all the circumstances, it was unreasonable for Midcoast not to accept the offer, warranting ordinary costs only up to 18 October 2017 and indemnity costs from 19 October 2017, together with interest on costs.

Jurisdiction
Australia
Judgment Date
17 October 2019
Procedural Posture
Costs Determination / On the Papers Following Judgment in Midcoast Petroleum Pty Ltd V Keldros Pty Ltd [2019] NSWSC 970
Outcome
Special costs order made in favour of the defendants.
Legal Topics
['calderbank Offer' 'indemnity Costs' 'ordinary Costs' 'interest on Costs' 'unreasonable Failure to Accept Settlement Offer']
['costs' 'civil Procedure' 'equity'] ['calderbank Offer' 'indemnity Costs' 'ordinary Costs' 'interest on Costs' 'unreasonable Failure to Accept Settlement Offer']

Case Brief

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Procedural Posture

Costs Determination / On the Papers Following Judgment in Midcoast Petroleum Pty Ltd V Keldros Pty Ltd [2019] NSWSC 970

Legal Issues

  1. 1 ["Whether the defendants' Calderbank offer warranted a departure from the ordinary rule as to costs." "Whether Midcoast's failure to accept the defendants' offer was unreasonable in all the circumstances." 'Whether interest on costs should be ordered.']

Ratio Decidendi

The Calderbank offer contained a genuine element of compromise and was more favourable to Midcoast than the judgment ultimately obtained. While the offer remained open, Midcoast had the defendants' expert and affidavit evidence showing real contests on liability and quantum, including contamination and make good issues, and had almost two weeks after service of that evidence to assess the offer. In all the circumstances, it was unreasonable for Midcoast not to accept the offer, warranting ordinary costs only up to 18 October 2017 and indemnity costs from 19 October 2017, together with interest on costs.

Court Disposition

Special costs order made in favour of the defendants.

Orders

  • ["Order the plaintiff to pay 80% of the defendants' costs of the proceedings up to and including 18 October 2017 on the ordinary basis." "Order the plaintiff to pay the defendants' costs from 19 October 2017 on the indemnity basis." "Order the plaintiff to pay interest to the defendants on the allowed percentage of...