New South Wales Supreme Court CITATION : Porter-Coote v DHSH (Aust) Travel Pty Ltd [2009] NSWSC 1094 HEARING DATE(S) : 6 October 2009 JUDGMENT OF : Gzell J EX TEMPORE JUDGMENT DATE : 6 October 2009 DECISION : Application refused. CATCHWORDS : PROCEDURE - Costs - Uniform Civil Procedure Rules 2005, Pt 42 r 42.13A - defendant made offer accepted by plaintiff - offer open for long period - acceptance on last day - plaintiff entitled to costs on ordinary basis up to when offer made unless court otherwise orders - whether court should order costs up to time offer accepted LEGISLATION CITED : Uniform Civil Procedure Rules 2005 Morgan v Johnson (1998) 44 NSWLR 578 CASES CITED : Macquarie Radio Network Pty Ltd v Arthur Dent (No 2) [2007] NSWCA 339 South Eastern Sydney Area Health Service & Anor v King [2006] NSWCA 2 Robert Porter-Coote (First Plaintiff) Gai Porter-Coote (Second Plaintiff) DHSH (Aust) Travel Pty Limited (First Defendant) PARTIES : Daniel Hewitt (Second Defendant) Susan Hewitt (Third Defendant) Max Raiola (Fourth Defendant) Kerry-Anne Raiola (Fifth Defendant) FILE NUMBER(S) : SC 6241/06; 2966/07 COUNSEL : J Phillips SC (Plaintiffs) I Raine (Defendants) SOLICITORS : Barwick Legal (Plaintiffs) Martin Legal (Defendants) IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION GZELL J TUESDAY 6 OCTOBER 2009 6241/06 ROBERT PORTER-COOTE & ANOR v DHSH (AUST) TRAVEL PTY LTD & ORS 2966/07 ROBERT PORTER-COOTE & ANOR v DHSH (AUST) TRAVEL PTY LTD & ORS EX TEMPORE JUDGMENT 1 A question has arisen as to whether there should be a departure from the Uniform Civil Procedure Rules 2005, Pt 42 r 42.13A in the exercise of the court's discretion. It provides that where an offer is made by the defendant and accepted by the plaintiff, the plaintiff is entitled to an order against the defendant for the plaintiff's costs in respect of the claim, assessed on the ordinary basis up to the time when the offer was made unless the offer states that it is a verdict for the defendant and the parties are to bear their own costs or the court otherwise orders. 2 It is submitted that since there was a substantial period of time when the offer was open for acceptance but the offer was not accepted until the last available date, the court should exercise its discretion and grant the plaintiffs costs up to the date of acceptance of the offer rather than up to the date on which the offer was made. 3 In Morgan v Johnson (1998) 44 NSWLR 578, Mason P derived a number of principles from his analysis of the leading cases on costs where a defendant makes an offer not accepted by the plaintiff who obtains a judgment not more favourable. The first principle was that the purpose of the rule is to encourage the proper compromise of litigation, in the private interests of individual litigants and the public interest of the prompt and economical disposal of litigation. 4 In Macquarie Radio Network Pty Ltd v Arthur Dent (No 2) [2007] NSWCA 339, Beazley JA at [15], in considering the situation where a plaintiff makes an offer not accepted by a defendant, to which the Uniform Civil Procedure Rules, Pt 42 r 42.14 applies, said that the court would only deviate from the general rule and make a different order if it found that there were exceptional circumstances for doing so. Her Honour referred to what Hunt AJA had said in South Eastern Sydney Area Health Service & Anor v King [2006] NSWCA 2 at [83]: "The onus is on the defendant to persuade the Court that indemnity costs should not be ordered. He must demonstrate the basis on which an order should be made denying the plaintiff's entitlement to indemnity costs. He must establish that he had given serious thought to the risk involved in non-acceptance of the offer, and that he had assessed the plaintiff's case properly and in the context of the rule and the achievement of its purpose - to encourage the proper compromise of litigation, in the private interests of the litigants and in the public interest of the prompt and economical disposition of litigation. Generally, exceptional circumstances are required to justify such an order denying the plaintiff's entitlement." 5 In my view, similar considerations apply with respect to the Uniform Civil Procedure Rules, Pt 42 r 42.13A. I therefore refuse to exercise my discretion in favour of the plaintiffs' application. ******************* 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.