Supreme Court New South Wales Medium Neutral Citation: The Owners Strata Plan No 66443 -v- Karimbla Constructions Services Pty Ltd (ACN) 093 419 875 [2012] NSWSC 798 Hearing dates: 28 June 2012 Decision date: 28 June 2012 Jurisdiction: Equity Division - Technology and Construction List Before: Hammerschlag J Decision: Proceedings dismissed. The appropriate figure that the plaintiff should be awarded and that the defendants should pay it inclusive of GST is the amount of $89,100 Catchwords: COSTS - contested application for costs where parties came to commercial settlement - Owners Corporation abandoned large portion of claims for defects - defendants (the builders) agreed to rectify small proportion of defects originally claimed - Parties agreed no reasons required and Court at liberty to fix quantum of any orders - No issue of principle Cases Cited: Re the Minister for Immigration and Ethnic Affairs of the Commonwealth of Australia v Ex parte Lai Qin (1997) 186 CLR 622 Category: Principal judgment Parties: The Owners Strata Plan No 66443 - Plaintiff Karimbla Constructions Services Pty Ltd (ACN) 093 419 875 - First Defendant Meriton Apartments Pty Ltd (ACN) 000 644 888 - Second Defendant Representation: Counsel: H.J.A. Neal - Plaintiff P.J. Bambagiotti - Defendants Solicitors: Bannermans Lawyers - Plaintiff Meriton Group - First and Second Defendants File Number(s): 2009/55030 EX TEMPORE Judgment 1HIS HONOUR: Before me is a contest with respect to the costs of proceedings, which have been in this list since 2009. They have come to an abrupt end, the parties having reached a commercial settlement which entails the defendants (both of which were engaged to do building works) agreeing to carry out rectification works at nominal cost to the plaintiff. 2If it appears that both parties have acted reasonably in commencing and defending the proceedings and that their conduct continued to be reasonable until the proceedings were settled or further prosecution became futile, the court will usually exercise its discretion to not make any order for the costs of the proceedings: Re the Minister for Immigration and Ethnic Affairs of the Commonwealth of Australia v Ex parte Lai Qin (1997) 186 CLR 622. 3As might be expected in the present case, each party started off at the opposite extremes of the scale, the plaintiff seeking costs of the entire proceedings and the defendants putting that no order for costs should be made. The plaintiff put that it had been successful because the settlement entails the defendants rectifying acknowledged defects. The defendants put that the plaintiff had made claims for many defects which were now abandoned and that those which it is to fix form a small proportion of the plaintiff's original claim. 4After some debate the parties, through counsel, sensibly agreed that I should exercise my discretion to make such order as to costs which I consider appropriate without the necessity for giving reasons and that I was at liberty to fix the amount of costs, if any, which I think is appropriate in the circumstances. 5In a written submission the plaintiff states that it costs amount to $270,000 exclusive of GST. It offered to accept $210,000 exclusive of GST from the defendants, who have made no offer. 6This type of situation occasions no little difficulty given that, on the one hand, the parties have reached what is clearly a commercial settlement; but on the other, that the plaintiff has had some measure of success given that the defendants have now agreed to fix defects forming what might be thought to be a modest proportion of the original defects claimed. 7In the circumstances, without giving further reasons, I consider that the appropriate order is that the defendants should pay the plaintiff's costs inclusive of GST and interest in the amount of $89,100, and I so order. 8At the time of the making of these orders, the parties had not yet exchanged formal documents recording their settlement but anticipated that this would happen shortly. Accordingly, and to ensure that no difficulties arise I will order that the proceedings are dismissed but the order will be stayed up to and including 13 July 2012. In the event that either party notifies me and the other party that the order should not take effect, the order for dismissal will be discharged and the matter will be re-listed for directions on 13 July 2012. Postscript No notification as contemplated in paragraph 8 above was received. ********** 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. Decision last updated: 16 July 2012