Court of Appeal Supreme Court New South Wales Medium Neutral Citation: Milling v Hardie (No 2) [2014] NSWCA 285 Hearing dates: On the papers Decision date: 25 August 2014 Before: Beazley P Macfarlan JA Sackville AJA Decision: Order that the respondents pay the appellant's costs of the proceedings at first instance and on appeal. [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: PRACTICE AND PROCEDURE - costs - no issue of principle Cases Cited: Stewart v Atco Controls Pty Ltd (in liquidation) (No 2) [2014] HCA 31 Category: Consequential orders Parties: Kenneth Milling (Appellant) David Hardie (First Respondent) Tracey Hardie (Second Respondent) Representation: Counsel: G M McGrath (Appellant) B W Rayment QC/M A Bradford (Respondents) Solicitors: Hannaford Cox Connellan & McFarland (Appellant) Booth Brown Samuels & Olney (Respondents) File Number(s): CA 2013/140710 Decision under appeal Jurisdiction: 9111 Citation: Hardie v Milling [2013] NSWSC 310 Date of Decision: 2013-04-10 00:00:00 Before: Lindsay J File Number(s): SC 2010/00420515 Judgment 1THE COURT: The Court delivered judgment on this appeal on 26 May 2014 ([2014] NSWCA 163). In accordance with directions made on that date, the parties lodged written submissions concerning the costs orders to be made in respect of the proceedings at first instance and on appeal. 2The appellant seeks orders that both respondents pay his costs of the appeal on the ordinary basis and his costs of the proceedings at first instance on the indemnity basis, or alternatively as to the latter proceedings, on the ordinary basis. 3He founds his claim for indemnity costs on the respondents' failure to accept a Calderbank offer that he made at first instance. The offer contemplated the creation, and transfer to the Hardies, of a proposed new Lot 1 encompassing the homestead and its curtilage. It was subject inter alia to consent to the subdivision involved being obtained from the appellant's mortgagee. In the letter of offer written on his behalf, the appellant provided no evidence as to the likelihood of the mortgagee agreeing to the proposal other than stating that he had "already spoken to the Bank on an informal basis". In the absence of such consent, or at least of some evidence of the likelihood of consent being obtained, it was not in our view unreasonable for the respondents to reject the offer (see Stewart v Atco Controls Pty Ltd (in liquidation) (No 2) [2014] HCA 31 at [4]-[6]). Accordingly, the rejection of that offer does not provide the basis for an award of indemnity costs. 4The appellant also refers in his submissions to an offer made in the course of the hearing in this Court, but the making of that offer could not justify an award of indemnity costs in respect of the already completed hearing at first instance. 5In the alternative, the appellant submits that he should be awarded his first instance and appeal costs on the ordinary basis because he was successful in resisting the respondents' claim that the second respondent was entitled to present or future ownership of Lots 110 and 118 of the Weeraman property. 6We accept the appellant's submission that this question of ownership was the fundamental matter at issue in the proceedings and that, because of his success on it on appeal, he is entitled to orders for payment of his costs incurred at first instance and on appeal. 7In its judgment of 26 May 2014, this Court concluded that the Hardies had not established that either of them had a right to acquire those lots or any part of them, whether by inter vivos or testamentary transfer. The first instance judgment holding otherwise was therefore set aside. 8The primary judge's declaration that the second respondent had a right to occupy the homestead on Weeraman with her family for the remainder of the appellant's life was not disturbed on appeal, although the form of the licence was varied to provide that it was exclusive. However, there was no contest between the parties either on appeal or at first instance in relation to the continuation of Mrs Hardie's present occupation of the homestead with her family. The appellant gave evidence that he had no intention to evict the Hardies, and on appeal his counsel submitted, correctly so far as the court record revealed, that the appellant had never been asked to take a stance on the question of whether the Hardies had a present right of occupation, this being a narrower question than those raised by the Hardies' broad and unsuccessful claims of entitlement to acquire proprietary interests in the two lots (Judgment of 26 May 2014 at [65]-[67], [91], [96] and [105]). 9In our view it can properly be said that the appellant was, without any substantial qualification, successful on the matters in issue in the proceedings. As a result, he is entitled to his costs. These should be awarded on the ordinary basis. 10For these reasons, the Court orders that the respondents pay the appellant's costs of the proceedings at first instance and on appeal. ********** 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: 25 August 2014