The Owners – Strata Plan No 99170 v MN Builders (No 2) (costs)

HER HONOUR: On 10 October 2025, I vacated a ten-day trial on the application of the defendants: The Owners Strata Plan 99170 v MN Builders Pty Ltd [2025] NSWSC 1190. By their motion, the defendants had sought the costs of their motion and the costs thrown away by reason of vacation of the hearing. I made those orders as well.

The plaintiff sought to make submissions in respect of the costs orders. Directions were made by consent for such submissions to be made.

The plaintiffs submit that the appropriate order is that the costs of the motion and the costs thrown away be the defendants’ costs in the cause. This is because the defendants did not promptly respond to the plaintiff’s initial letter foreshadowing the service of further expert evidence. The defendants later consented to the plaintiff being given leave to rely on that evidence but did not begin work on preparing evidence in response until after a mediation in September 2025. Further, the defendants consented to leave being granted to the plaintiff to rely on the further expert evidence without raising with the Court the possibility that this would imperil the hearing (although I note that the defendants squarely raised this with the plaintiff in correspondence) and without having spoken to the defendants’ quantum expert at all about the evidence required. (I am unsure what follows from this, where there was no dispute that Mr Archer could not begin work until the plaintiff’s experts had finished theirs).

Further, the plaintiff submitted that the defendants’ experts were unavailable due to matters outside the plaintiff’s control, including other commitments, overseas travel, leave and injury. Finally, while the plaintiff opposed the vacation of the trial, it was said to have cooperated in getting the motion heard on a very tight timetable and otherwise acting expeditiously.

In admirably brief submissions, the defendants submitted that there was nothing in the plaintiff's submissions that warranted a departure from the usual rule that costs ought follow the event: Uniform Civil Procedure Rules 2005 (NSW) r 42.1. The motion to vacate was occasioned by reason of the plaintiff’s default in serving its evidence in accordance with directions or within the timeframes indicated by it in correspondence or within such time as to allow the defendants to properly respond whilst preparing for a hearing. The plaintiff's submissions neither explained nor justified these defaults.

I agree. The details of how the hearing came to be vacated are set out in my earlier judgment. In short, from May 2025 on, the plaintiff served further liability and quantum expert evidence, on which it needed the leave of the Court to rely. The defendants squarely raised the prospect that the trial date would be lost by reason of this material but did attempt to meet the challenge which the service of this material presented. The defendants consented to leave being given to the plaintiff to rely on this material and also agreed to a timetable to put on evidence in reply. But the plaintiff’s evidence kept coming. Indeed, the plaintiff served a 975-page supplementary quantum report the day before the motion to vacate was heard.

The defendants did defer incurring further costs in meeting the late-served material until after a mediation had been completed. Whilst the defendants’ ability to meet this material would have been enhanced if it had tasked its experts with replying to that material immediately on receipt of the late reports, it was not unreasonable for the defendants to conduct themselves as they did, including having regard to the fact that the plaintiff was then seeking an indulgence to rely on the material at all.

It is true that some of the defendants’ experts cannot, by reason of their personal circumstances or availability, attend to preparing reply reports in the limited time remaining before the trial. That is beyond the plaintiff’s control but also the control of the defendants. But the reason why the defendants are scrambling to prepare reply reports in this confined timeframe is due to the plaintiff’s conduct in the first place. It is difficult to see how the regrettable vacation of a trial in this long-running proceedings was other than brought about by the plaintiff’s conduct of the proceedings. I do not consider it appropriate to make orders in a form other than as sought by the defendants in their motion and already made.