There is no presumption that rejection of a Calderbank offer warrants indemnity costs; the test is whether the rejection was unreasonable in the circumstances. The test does not require the rejection to be 'manifestly' or 'plainly' unreasonable, nor does it require proof of misconduct, wilful disregard of known facts, or high-handed presumption. Relevant factors include the stage of proceedings, time allowed to consider the offer, extent of compromise, the offeree's prospects of success assessed at the date of the offer, clarity of terms, and whether the offer foreshadowed an indemnity costs application.
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