Roads and Traffic Authority of New South Wales v Dimitrovski (No 2)

THE COURT : In this matter the Court has dismissed the appeal. Consequent upon making that order an application was made by the respondent that the costs of the appeal be paid on an indemnity basis.

The basis of the application was that an offer of compromise was made in the District Court proceedings prior to trial and the result of not only the District Court proceedings, but of the appeal is that the award of damages in the respondent’s favour is in excess of the offer contained in the offer of compromise.

The question of indemnity costs on appeal has been considered by this Court on a number of occasions. The Court was referred to the decision of this Court in Fotheringham v Fotheringham (No 2) (1999) 46 NSWLR 194. That case considered the Court’s earlier decision in Ettingshausen v Australian Consolidated Press Limited (1995) 38 NSWLR 404. Both of those cases involved proceedings which had been commenced and wholly conducted within the Supreme Court.

The question of the appropriate rules and principles to apply in circumstances where proceedings commenced and determined at first instance in the District Court was considered by the Court of Appeal in South Sydney Council v Morris (No 3) [2001] NSWCA 200. There Heydon JA (Meagher JA and Fitzgerald AJA agreeing) pointed out that Pt 39A r 25(4) of the District Court Rules (1973) NSW, under which offers of compromise are made in the District Court, cannot apply in terms to the costs of the appeal. In respect of appeals coming from the District Court, this Court has inherent power to make, as a matter of discretion, an indemnity costs order.

Accordingly, the Court can treat the application for indemnity costs in this matter as being made on that basis.

The Court has considered the application but has determined it is not an appropriate case for the award of indemnity costs. The appeal was unsuccessful and the Court was able to deal with it within a fairly short compass for a number of reasons. However, it cannot be said that the points taken on appeal were so unarguable that the appeal ought not to have been brought, both in relation to liability and future economic loss.

We do note that the appellant strictly would have been successful on the point of law under Woolage v The State of New South Wales [2001] NSWCA 256, but we do not think that was a significant matter in our determination, given the concession in relation to damages.

In conclusion, we consider the appeal was one which was arguable, although not successful and, therefore, the usual costs order should apply.