Lau v Anglican Community Services (No 2)

THE COURT: The application for leave to appeal and the cross-appeal in this matter were heard on 20 March 2026. On 17 April 2026, we made orders refusing Mr Lau’s application for leave to appeal and ordered that he pay the costs of that application. At the same time, we granted Anglicare leave to cross-appeal, allowed the cross-appeal in part and ordered Mr Lau to pay Anglicare’s costs of the cross-appeal: see Lau v Anglican Community Services [2026] NSWCA 53.

On 31 March 2026, Anglicare gave timely notice to the Court and Mr Lau that it intended to seek a different costs order in relation to both the application for leave to appeal and the cross-appeal. Anglicare now seeks an order that on and from 13 February 2026, Mr Lau pay Anglicare’s costs of the application for leave to appeal and the cross-appeal on an indemnity basis on the grounds that it was unreasonable for him not to have accepted the offer to settle both proceedings.

The terms of the offer were contained in a letter dated 13 February 2026 from Anglicare’s solicitors to Mr Lau’s solicitors and were relevantly as follows:

Mr Lau rejected that offer.

It is unnecessary to descend into a detailed comparison between the result in the proceedings in this Court and the terms of the offer to settle them. It is clear that the terms of Anglicare’s offer which Mr Lau rejected would have left him by any reasonable measure in a substantially better position than the outcome he ultimately achieved on both his appeal and the cross-appeal.

Mr Lau submitted that the offer to settle was in truth no more than an offer to capitulate and was not in the circumstances a genuine offer to compromise the proceedings. The difficulty with that contention is that by the time Anglicare made the offer on 13 February 2026, Mr Lau had already failed to obtain the principal claim for relief that he sought at trial, being a public apology, and only succeeded in recovering nominal damages. Mr Lau’s realistic prospects of succeeding in this Court were to that extent more clearly illuminated by the time he received the offer to settle than they were before the trial judge published his reasons for judgment. Anglicare’s pre-trial position, explained in detail in the correspondence exchanged in support of their original offer of compromise, had by the time of the latest offer effectively been vindicated. It was in the circumstances unreasonable for Mr Lau to have rejected Anglicare’s offer to settle the proceedings in this Court.

It follows that Mr Lau should pay Anglicare’s costs of the appeal and the cross-appeal on an indemnity basis on and from 13 February 2026.