Court of Appeal Supreme Court New South Wales Medium Neutral Citation: Galea v Farrugia (No 2) [2013] NSWCA 376 Hearing dates: On the papers Decision date: 13 November 2013 Before: Bathurst CJ at [1] Macfarlan JA at [2] Ward JA at [9] Decision: The respondents' Notice of Motion is dismissed with costs. [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.] Catchwords: COSTS - successful respondents sought indemnity costs - UCPR r 20.26 offer of compromise and Calderbank offer to settle appeal on a "walk away basis" - inference that respondents had undertaken little work on the appeal when offers made - no genuine compromise offered - application refused Cases Cited: Vagg v McPhee (No 2) [2013] NSWCA 126 Category: Costs Parties: Paul Galea (First Appellant) Mary Galea (Second Appellant) Lepipi Pty Ltd (Third Appellant) David Farrugia (First Respondent) Mary Farrugia (Second Respondent) J & L Cauchi Pty Ltd (Third Respondent) Joe Cauchi (Fourth Respondent) Representation: Counsel: M J Neil QC (Appellants) P Barham (First and Second Respondents) J A Hogan-Doran (Third and Fourth Respondents) Solicitors: Mosca & Scott (Appellants) NSW Compensation Lawyers (First and Second Respondents) Balmain Lawyers (Third and Fourth Respondents) File Number(s): CA 2012/82184 Decision under appeal Jurisdiction: 9111 Citation: Galea v Farrugia [2012] NSWSC 77 Date of Decision: 2012-02-21 00:00:00 Before: Hislop J File Number(s): 2003/91314 Judgment 1BATHURST CJ: I agree with Macfarlan JA. 2MACFARLAN JA: The Court delivered judgment on this appeal on 7 June 2013 ([2013] NSWCA 164), following a hearing on 10, 11 and 12 April 2013. It ordered that the appeal be dismissed and that the appellants pay the first and second respondents' (referred to below as the "respondents") costs of the appeal. 3By Notice of Motion filed on 17 June 2013, the respondents seek a variation of this costs order. As explained in their written submissions, they seek "costs on the usual party/party basis until 9.00 am on 27 June 2012 and indemnity costs thereafter, alternatively costs on the usual basis until 9.00 am on 7 December 2012 and indemnity costs thereafter". They rely upon an Offer of Compromise, served on 26 June 2012, offering to settle the appeal on a "walk away basis", that is, that the appeal be dismissed with the parties bearing their own costs. In the alternative they rely upon a Calderbank letter of 6 December 2012 making the same offer. Neither offer was accepted. 4The appeal was from a judgment of Hislop J of 21 February 2012. The appellants' Notice of Appeal was filed on 18 May 2012. Their written submissions (in their unamended form) were filed on 15 August 2012, with their statement in narrative form challenging findings of fact (see UCPR r 51.36(2)) (again prior to amendment) apparently being filed about the same time. The respondents filed a reply to the appellants' statement in narrative form challenging findings of fact on 1 February 2013 and their written submissions on 4 February 2013. 5In opposition to the respondents' claim for indemnity costs, the appellants' submitted that neither offer involved an element of genuine compromise by the respondents. If this be the case, the application for indemnity costs should be refused (see Vagg v McPhee (No 2) [2013] NSWCA 126). 6The appellants submitted that the chronology of events to which I have referred above gives rise to the inference that the respondents would have undertaken little work, and therefore incurred little expense, in relation to the appeal before the dates of 27 June and 7 December 2012 upon which the offers were made. There is no evidence suggesting otherwise and I accept that submission. I consider that the inference is a reasonable one as the respondents' written submissions and response to the appellants' r 51.36(2) document were not filed until approximately seven months after the Offer of Compromise and two months after the Calderbank offer. 7In these circumstances, the appellants' submission that the respondents' offers did not involve any element of genuine compromise should be accepted. At most, the respondents offered to give up an entitlement to their costs incurred prior to the offers being made but there is no basis for concluding that they had incurred any significant costs by the dates of the offers. 8For these reasons, the respondents' application for indemnity costs should be rejected and their Notice of Motion dismissed with costs. 9WARD JA: I agree with Macfarlan JA. ********** 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 November 2013