COSTS — Exceptions to general rule that costs are to be assessed on the ordinary basis — Calderbank offer — no issue of principle
Quick Take
1A Calderbank offer, unlike a formal offer of compromise under UCPR Pt 42 Div 3, does not give rise to a presumptive entitlement to indemnity costs merely because the offeror obtained a result no less favourable than the offer; the offeror must additionally establish that the offeree's rejection was unreasonable.
2In assessing the reasonableness of rejecting a Calderbank offer, the offeree's prospects of success as at the date of the offer are a critical factor; an offer to forego recovery of substantial incurred costs can constitute a genuine compromise even where those costs are modest relative to the value of the subject matter, if the offeree's prospects were objectively poor.
3A party's limited financial means and familial relationship with the opposing party have little bearing on whether indemnity costs should be ordered following rejection of a Calderbank offer in proceedings to vindicate a private right.
