Rickard Constructions v Rickard Hails Moretti & Ors [2005] NSWSC 481

Rickard Constructions v Rickard Hails Moretti & Ors [2005] NSWSC 481

The third defendant's Calderbank offer was, in the context of the litigation, a genuine and reasonable offer of compromise. Given the objective circumstances, including the plaintiff's misconceived case and the clear indication of likely failure on key issues, the plaintiff's rejection of the offer was unreasonable. Sufficient circumstances existed to displace the general rule as to costs, justifying indemnity costs from a time referable to the offer.

Parties
Plaintiff: Rickard Constructions Pty Limited; First Defendant: Rickard Hails Moretti Pty Limited; Second Defendant: Jeffery & Katauskas Pty Limited; Third Defendant: Allianz Australia Insurance Limited
Jurisdiction
Australia
Judgment Date
27 May 2005
Procedural Posture
Costs Application / Judgment Following Written Submissions on Indemnity Costs
Outcome
Application for indemnity costs granted in part.
Legal Topics
Costs, Indemnity Costs, Calderbank Offer, Offer of Compromise, Reasonableness of Rejection
Civil Procedure Costs Indemnity Costs Calderbank Offer Offer of Compromise Reasonableness of Rejection

Case Brief

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Parties

Rickard Constructions Pty Limited

Plaintiff

Rickard Hails Moretti Pty Limited

First Defendant

Jeffery & Katauskas Pty Limited

Second Defendant

Allianz Australia Insurance Limited

Third Defendant

Procedural Posture

Costs Application / Judgment Following Written Submissions on Indemnity Costs

Legal Issues

  1. 1 Whether the third defendant's Calderbank offer was a genuine and reasonable offer of compromise
  2. 2 Whether it was unreasonable for the plaintiff to reject the offer so as to justify indemnity costs from that date

Ratio Decidendi

The third defendant's Calderbank offer was, in the context of the litigation, a genuine and reasonable offer of compromise. Given the objective circumstances, including the plaintiff's misconceived case and the clear indication of likely failure on key issues, the plaintiff's rejection of the offer was unreasonable. Sufficient circumstances existed to displace the general rule as to costs, justifying indemnity costs from a time referable to the offer.

Court Disposition

Application for indemnity costs granted in part.

Orders

  • Plaintiff to pay the third defendant's costs on a party and party basis up until 13 April 2003 and on the indemnity basis thereafter.
  • Costs payable to include those of the indemnity costs application.