Supreme Court New South Wales Medium Neutral Citation: Technology Leasing Limited v Colan Bros Pty Ltd (No 2) [2013] NSWSC 771 Hearing dates: 12 June 2013 Decision date: 12 June 2013 Before: McCallum J Decision: Plaintiff to pay the defendant's costs of the proceedings as agreed or assessed on the ordinary basis. Catchwords: PROCEDURE - costs - offer of compromise - whether offeree's rejection unreasonable Legislation Cited: Trade Practices Act 1974 (Cth) Cases Cited: Perpetual Trustee Company Limited v El-Bayeh (No. 2) (2011) NSWSC 1049 Technology Leasing Limited v Colan Bros Pty Limited [2013] NSWSC 751 Category: Costs Parties: Technology Leasing Limited (CAN 071 702 264) (plaintiff) Colan Bros Pty Ltd (ACN 002 642 168) (first defendant) Jorja Investments Pty Ltd (ACN 120 846 022) (second defendant) Representation: Counsel: S Goodman (plaintiff) A Crossland (defendants) Solicitors: HAL Group (plaintiff) Attwood Marshall (defendants) File Number(s): 2013/94838 Publication restriction: None Judgment - ex tempore - as to costs 1HER HONOUR: I have this afternoon published my decision determining an appeal from the Local Court: see Technology Leasing Limited v Colan Bros Pty Limited [2013] NSWSC 751. The orders I proposed were that the appeal should be dismissed with costs. Upon enquiry of counsel for the defendants, I was informed that there was an application for a special order as to costs on the basis that the defendants offered to compromise the proceedings by way of what is known as a Calderbank letter. The letter, dated 8 May 2013, offered to settle the appeal on terms that the plaintiff pay to the defendants 90 percent of the assessed costs of the Local Court proceedings and the defendants' costs to date of the appeal proceedings, as agreed or assessed, and that the appeal proceedings be withdrawn. 2As noted on behalf of the plaintiff, in order to make good an application for a special order as to costs on the basis of a Calderbank letter, the applicant for the order must persuade the Court that, considering all of the circumstances, the offeree could not reasonably fail to accept the offer. 3Mr Goodman, who appears for the plaintiff, reminded me of my discussion of those principles in Perpetual Trustee Company Limited v El-Bayeh (No 2) [2011] NSWSC 1049. In that decision I noted at [45] that the reasonableness of a decision not to accept a settlement offer is not to be determined with hindsight; rather, the strength or otherwise of the claim should be considered prospectively as at the time of the offer. 4The present appeal raised an issue as to the proper construction of s 4B of the Trade Practices Act 1974 (Cth). Whilst I have determined the appeal adversely to the plaintiff, publishing relatively brief ex tempore reasons, I am not persuaded that the issue raised was manifestly unarguable, or that it was unreasonable not to capitulate to the offer put forward on behalf of the defendants. The offer reflected little compromise, being, as noted by Mr Goodman, only 10% of the assessed costs of the proceedings below. Whilst those costs are relatively considerable as costs in the Local Court go, the percentage discount offered is small. 5A further matter (to which I did not refer in my principal judgment published this afternoon) is that there was some measure of confusion in the decision of the magistrate which may have contributed to the impression that her Honour had erred. At [124] of the judgment, having made her primary finding at [123] accepting the analysis contended for by the defendants, the magistrate considered the alternative argument put forward on behalf of the plaintiff. In doing so, confusingly, her Honour stated that even if the plaintiff's position (of approaching the matter by reference to s 4B(2)(e)) were adopted, the total amount payable by the defendants in all proceedings was less than the prescribed amount. The confusion flows from the fact that her Honour then proceeded to identify the total rental payable by the two defendants in these proceedings, which in fact was not less than the prescribed amount in either case. 6One way in which sense can be made of that paragraph is to read the previous sentence as if her Honour had concluded that the total amount payable by the defendants in all but two of the proceedings was less than the prescribed amount. But without reading it in that way, the paragraph is difficult to comprehend and appears to have, in part, prompted the view that her Honour had fallen into error. I have concluded that her Honour did not, because the primary finding at [123], in my view, was open and not wrong. 7For those reasons I am not persuaded that this is an occasion on which it is appropriate to make any special order as to costs. I confirm the order I proposed when I came onto the bench this afternoon that the plaintiff pay the defendant's costs of the proceedings as agreed or assessed on the ordinary basis. ********** 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: 13 June 2013