The Court held that a defendant's 'walk away' offer of compromise (dismissal with no order as to costs) in binary, non-monetary proceedings can constitute a genuine offer of compromise engaging the indemnity costs presumption under UCPR r 42.15A, where the costs forgone by the offeror are more than trivial and the offer is accompanied by a thorough legal analysis demonstrating the strength of the defence. The Court found that the usual features of an unsuccessful but non-frivolous claim — including reasonable prospects at the time of the offer, absence of litigation misconduct, and the binary nature of the dispute — are insufficient individually or collectively to displace the defendant's conditional entitlement to indemnity costs. The Court also noted that while the precise quantum of forgone costs need not always be established, the court may take judicial notice of the likely magnitude of legal costs based on the observable volume and complexity of work performed.
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