Hooper v Phipps (No 4)

[2026] NSWDC 265

NSW District Court

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For Australian Law.

1. COSTS — plaintiff discontinues defamation proceedings on the last day of the trial, asserting health issues prevent him from continuing — two prior jury trials aborted because the plaintiff collapsed whilst in the courtroom — defendants’ application for indemnity costs of all trials — offers made by both parties — interaction of s 40 Defamation Act 2005 (NSW) with general costs principles — application for indemnity costs refused — fees outstanding under s 10 Civil Procedure Regulation 2017 (NSW) waived

Under s 40 of the Defamation Act 2005 (NSW), settlement offers must be assessed holistically under s 40(2)(a), taking into account the conduct of both parties including whether the opposing party made any offer; where a defendant's offers require total capitulation and the plaintiff has made reasonable counter-offers, the defendant's offers will not satisfy s 40 so as to warrant indemnity costs.
Where s 40 of the Defamation Act 2005 (NSW) governs the costs regime, a defendant cannot circumvent an unsuccessful s 40 application by recharacterising the same offers as Calderbank offers to obtain indemnity costs on common law principles, as this would undermine the statutory scheme.
A plaintiff's medical unfitness to continue litigation does not override or 'trump' the operation of s 40 costs provisions; even incontrovertible evidence of health risks from continuing proceedings does not of itself preclude costs orders in civil cases, and conflicting medical evidence — even if suggestive of dishonesty — is insufficient alone to establish abuse of process warranting indemnity costs.