C&V Engineering Pty Ltd v Hamilton & Marino Builders Pty Ltd [2019] NSWDC 323

District Court New South Wales

Medium Neutral Citation: C&V Engineering Pty Ltd v Hamilton & Marino Builders Pty Ltd [2019] NSWDC 323 Hearing dates: 3 June 2019 Date of orders: 12 July 2019 Decision date: 12 July 2019 Jurisdiction: Civil Before: Montgomery DCJ Decision: (1) Order 2 made 3 June 2019 be varied as follows: "Plaintiff to pay the defendant's cost of the proceedings on the normal basis up to and including 30 October 2018, and thereafter on an indemnity basis"; and (2) I order the exhibits be returned Catchwords: COSTS- indemnity basis - Offers of Compromise Legislation Cited: Uniform Civil Procedure Rules 2005 (NSW), Civil Procedure Act 2005 (NSW) Cases Cited: Leichardt Municipal Council v Green [2004] NSWCA 341 Calderbank v Calderbank [1975] 2 All ER 333 Arcos Industries Pty Ltd v Electoral Commission of NSW [1973] 2 NSWLR 186 Category: Costs Parties: Plaintiff: C&V Engineering Services Pty Ltd

Defendant: Hamilton & Marino Builders Pty Ltd Representation: Counsel:

Mr G Campbell (Plaintiff)

Mr M Sheldon (Defendant)

Solicitors:

Daniel Massey (Plaintiff)

Vincent Young (Defendant) File Number(s): 2018/151422 Publication restriction: N/A

Judgment

Approach to Costs 1. The Court having received the parties written submissions as to costs, by arrangement with the parties, these reasons were forwarded to them on a preliminary basis and with an invitation to make oral submissions if required. Both parties informed the Court that they did not seek to make oral submissions. 2. The plaintiff's action was for damages to compensate it for loss of the bargain of a lump sum contract made with the defendant, which damages it expressed as the loss of profit, calculated in its closing submissions, in the sum of $111,511.00. 3. In my principle Judgment, I determined that the parties did not agree a lump sum contract, that the defendant did not breach the contract actually made, and the plaintiff's action for damages failed. 4. The defendant seeks that its costs of the proceedings be paid by the defendant on an indemnity basis: CPA s 98; UCPR r 42.5. The plaintiff concedes only the costs be paid on the ordinary basis, following the event: UCPR r 42.1. The defendant promotes its application by reference to general principles of public policy of an offer, the court imposing cost consequences in circumstances where the unsuccessful party has rejected the successful party's reasonable offers. With reference to Leichardt Municipal Council v Green [2004] NSWCA 341 at [9], the defendant identifies the following grounds for its application: 1. The quantum in dispute was relatively modest; 2. The defendant was forced into protracted litigation at the plaintiff's election; 3. At all times, including prior to proceedings being commenced, the defendant acted reasonably and responsibly and sought to avoid the costs of litigation; and 4. The defendant made multiple genuine offers of compromise that were better than the result the plaintiff achieved and which, as demonstrated by the Judgment, were unreasonably rejected. 1. What the defendant's submission refers to as "genuine offers of compromise" are communications attempting to resolve the matter. The defendant does not rely on formal offers of compromise made pursuant to UCPR r 20.26. 2. Each of the defendant's communications, which are discussed in more detail below, offered a more favourable result than the plaintiff achieved in the Judgment. 3. By its written submission dated 14 June 2019, the defendant claims that it was successful on the question of interpretation of the contract and that that question was "the threshold question". The defendant's submission misstates the reasoning in the Judgment delivered 3 June 2019. The central question determined was whether or not the contract expressed in the plaintiff's email of 10 April 2015 (referred to as the "Offer") was, as claimed by the plaintiff, a lump sum contract. Determination of that question was closely related to the separate question of whether or not the parties intended to be immediately bound at the time of the defendant's email on 13 April 2015. The plaintiff claimed that email to be an acceptance of the Offer. The defendant denied acceptance, and that the parties entered into a lump sum contract. The defendant ran the case on the basis that its email of 13 April 2015 was a counter offer and not an acceptance. Whilst nothing expressed here is intended to be read as qualifying or contrary to the reasons for Judgment, I did find that the defendant's email of 13 April 2015 was an acceptance of the contract contained in the Offer. The plaintiff was successful on that issue. I construed the contract as expressly providing other than an agreement of lump sum contract. 4. Accordingly, the defendant was successful because the plaintiff failed on its case of lump sum contract. The defendant was not successful on the basis of "proper interpretation of the Contract" advanced by it at the Hearing.