3.68: Court options to deal with significant deficiencies
4.24: Formal offers to settle
4.29: Costs consequences of formal offer to settle
10.31: Court-ordered costs award
10.33: Court considerations in making costs award

Case Summary

Nexxtep applied to strike portions of the Affidavit of Talisman pursuant to Rule 3.68. Nexxstep argued that the Affidavit contained testimony and attached exhibits which Talisman should have produced at Trial and allegations of damages for which Talisman did not Counterclaim. Talisman submitted that it was entitled to Costs of the Action, while Nexxtep maintained that each party should be responsible for its own Costs.

Justice Poelman noted that the Court may consider any matter relevant to Costs under Rule 10.33, and that there are many matters relevant to Costs that are not relevant to liability and relief. Such matters may be adduced by way of representations of counsel, Affidavit evidence, and viva voce testimony. The Court found that the evidence was admissible as it was relevant to determining Costs, and the Application to strike the Affidavit or portions of it was dismissed.

Nexxstep argued that each party should have been responsible for its own Costs because the basis of the original Judgment was not argued by either party, which amounted to divided success. His Lordship stated that the result of the Trial was in favour of Talisman on all issues of substance between the parties. The Court concluded that Talisman, as the successful party, was entitled to its Costs.

Before Trial, Talisman served a Formal Offer to Settle pursuant to former Rules 169(3), 170(5), and 174. Neither Justice Poelman nor the parties suggested that the difference in wording between the aforementioned former Rules and their new Rules counterparts, Rules 4.24 and 4.29, should alter the determination of Costs consequences in this matter.

Talisman argued that it was entitled to Double Costs under Rule 4.29(3) because: (a) Nexxstep did not accept Talisman’s Formal Offer to Settle; and (b) Talisman received an award more favourable than the Offer. The Court found that Talisman’s Offer to Settle contained too many alternatives when issues associated with the pending Trial remained undetermined. There was no evidence at Trial to confirm the practical difference of many geological terms used in the Offer to Settle, and Justice Poelman said that Nexxtep was “entitled to precision in the terms of an Offer, particularly at the stage when it has to make its decision”. The Court found that it was not proper to award Double Costs in favour of Talisman.

Finally, Nexxtep argued that Talisman’s claims for expert charges should have been significantly reduced because of the experts’ unclear or unhelpful contribution to the proceedings. The Court found that Talisman’s expert charges were reasonable and proper, stating:

The fact that an expert’s evidence was not referred to in my reasons or an expert did not testify … or that some were found not particularly helpful, is not determinative.

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