McIntyre J

4.29: Costs consequences of formal offer to settle
10.29: General rule for payment of litigation costs
10.30: When costs award may be made
10.31: Court-ordered costs award
10.33: Court considerations in making costs award

Case Summary

The Defendant applied for Summary Dismissal, but abandoned the Application just prior to the Hearing. The Plaintiff sought thrown away Costs and punitive Costs. Master Prowse awarded enhanced Costs of $13,000. The Plaintiff Appealed the Costs award, which Appeal was dismissed. The Plaintiff had refused to accept a number of offers to settle prior to the Appeal, all of which were beaten on Appeal. The Defendant sought an enhanced Costs award for the Appeal.

Justice McIntyre noted that partial or full indemnity Costs can be awarded if a case involves “reprehensible, scandalous or outrageous conduct”. The Defendants retained second counsel to argue the Costs Appeal when it came to light that the Plaintiff was making direct allegations of misconduct against the Defendant’s lawyer. Justice McIntyre noted that this was an acceptable reason to employ second counsel in these matters, but declined to award full Costs for the second counsel because that would amount to indemnity Costs for the Defendant.

Justice McIntyre noted that the Plaintiff’s statement that employing second counsel was merely a “ploy” to get an adjournment was “over the line” in the circumstances, warranting enhanced Costs. Justice McIntyre also noted that Rule 4.29 indicates that if settlement is offered, but refused, and the final result is less than the offer, Costs against that party ought to be increased under Rule 4.29, but the proportion is in the discretion of the judge. Justice McIntyre held that, in the circumstances, an enhanced Costs award against the Plaintiff was warranted.

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