New South Wales Court of Appeal CITATION : Matchan v. Lyons [2004] NSWCA 36 HEARING DATE(S) : Matter dealt with in Chambers JUDGMENT DATE : 27 February 2004 JUDGMENT OF : Hodgson JA at 1; Cripps AJA at 1; Palmer J at 1 DECISION : No amendment made to orders made on 22 December 2003. CATCHWORDS : PROCEDURE - COSTS - Substituted judgment to take effect as at date of original judgment - Offer of compromise by appellant/defendant - Appellant fails on some issues - No indemnity costs - No apportionment of costs. PARTIES : Rhys Evan Matchan - appellant Geoffrey James Lyons - respondent FILE NUMBER(S) : CA 40178/03 COUNSEL : Ms. K. Williams for appellant Mr. C. Branson QC for respondent SOLICITORS : Phillips Fox, Sydney for appellant Harris Lieberman Boyd, Albury for respondent LOWER COURT District Court JURISDICTION : LOWER COURT DC23/02 (Albury) FILE NUMBER(S) : LOWER COURT Goldring DCJ JUDICIAL OFFICER : IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40178/03 DC 23/02 HODGSON JA CRIPPS AJA PALMER J Friday 27 February 2004 MATCHAN V. LYONS Judgment (On Costs) 1 THE COURT: Judgment in this matter was delivered on 22 December 2003, when the Court made the following orders: 1. Appeal allowed. 2. Verdict and judgment in the District Court be set aside and in lieu thereof a verdict and judgment be entered for the respondent in the sum of $431,716.80. 3. The respondent is to pay the appellant's costs of the appeal but is to receive a certificate under the Suitors' Fund Act 1951 (NSW), if otherwise entitled. 2 However, on application made at that time, an order was made to the effect that written submissions could be made concerning the costs order, and that the costs order would be reconsidered on the basis of those submissions. 3 Written submissions have been provided. 4 The appellant has sought an order that the costs order in its favour should be on an indemnity basis after 25 September 2003, that being the date of service of an offer of compromise, which was in the following terms: 1. The appellant offers to compromise this action on terms that: 1.1 The appeal be allowed. 1.2 The judgment of His Honour Judge Goldring in the District Court in favour of the respondent be set aside. 1.3 There be substituted judgment for the respondent in the sum of $435,000 clear of payments made by the appellant in the sum of $72,254. 1.4 The appellant to pay the costs of the respondent in the court below. 1.5 Each party to pay their own costs of the appeal. 1.6 This offer shall remain open to be accepted until 23 October 2003. 1.7 The appellant undertakes to pay the said sum within 28 days of acceptance of this offer and the costs within 28 days of taxation or of agreement as to costs as the case may be. 2. This offer of compromise is made in accordance with Part 22 of the Supreme Court Rules 1970. 5 The respondent submitted that the judgment substituted by the Court of Appeal should have been for $449,515.65, so as to include interest, and that the Court of Appeal judgment should be amended accordingly under the slip rule. On that basis, the appellant's offer was for less than the respondent obtained. 6 The respondent also submitted that the respondent should be ordered to pay only one half of the appellant's costs of the appeal, because the appellant had failed on certain grounds of appeal and succeeded in part on the basis of a ground (deficiency of reasons) not articulated by the appellant. 7 In our opinion, both the offer of compromise and our judgment contemplate the substitution of a verdict and judgment for that of the primary judge, so that the substituted judgment takes effect as at the date of the original judgment. Accordingly, interest is not an issue, and the appellant's offer was more favourable to the respondent than our order. 8 However, we would not award indemnity costs to the appellant, nor would we deprive the appellant of any costs. 9 As to the latter, the issues were not readily severable, and the case was over within a day. As to the former, we think that it is relevant that the appellant failed on some issues, that the offer was by a defendant, that it barely exceeded the result, and that the plaintiff did not act unreasonably in seeking to maintain his verdict at first instance. 10 Accordingly, we make no amendment to the orders made on 22 December 2003. ********** Last Modified: 03/01/2004 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.