Litig8: Costs: When the winner doesn’t get all

May, 2016

By Damian Ward, Partner

Each month as a part of Mills Oakley’s Litig8, we bring to you snapshots of eight key cases, legislative changes or other legal events. The summaries are not comprehensive and do not constitute legal advice. You should seek professional advice before taking any action based on the content of this email.

Part 4 of the May edition of Litig8

A recent decision of the Court has clarified when a party is entitled to some but not all of its costs.

Costs are a self-evidently important aspect of litigation. The general rule is that costs follow the event. That is, a party who has a substantial measure of success in proceedings should have their costs of the proceedings notwithstanding they may have failed on some causes of action or claims.

That being said, as a general principle of ordinary application, costs are discretionary. The Court of Appeal in New South Wales and Capogreco v Rogerson [2016] NSWCA 61 recently considered partial costs orders. The case involved a dispute with regard to the sale of shares in a race horse.

The appellant alleged the respondent had no entitlement to sell the race horse. He pleaded various types of claims against the respondent. The Court made an allocation that the costs be divided by percentages. The actual amount of the costs would be subject to costs assessment. However, upon quantification, the respective costs percentages would be effectively set off against each other.

The Court of Appeal found such a power was within the province of the trial judge. There is, subject to the discretion of the trial judge, justification for making an overall apportionment of costs. It is inherently a matter of impression. It is sufficient for the trial judge to clearly and reasonably briefly set out the factors taken into account in undertaking the allocation to satisfy the obligation to give judicial reasons.

This judgment is a reflection on the general flexibility that Courts have to fashion costs orders with the intent to do justice between the parties.

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