Yowie Group Ltd and Bolton v Keybridge Capital Ltd (No 4)

1. [1]

   THE COURT: On 30 July 2025, the Court delivered its judgment in this matter: Yowie Group Ltd and Bolton v Keybridge Capital Ltd (No 3) [2025] NSWCA 168. In what follows familiarity with that decision is assumed.

2. [2]

   At the time judgment was handed down, the successful respondent sought the fixing of a timetable to make submissions about a special costs order. The Court made the following orders:

   1. (1)

      Direct that the respondent file any submissions in respect of special costs order in light of the Court’s decision of no more than 3 pages, by 4pm on Friday 1 August 2025 together with any evidence.

   2. (2)

      Direct that Mr Bolton file any submissions of no more than 3 pages and evidence in reply, by 4pm next Wednesday 6 August 2025.

   3. (3)

      Direct that the respondent file any submissions in reply to Mr Bolton’s submissions, by 4pm Friday 8 August 2025. If the respondent does not intend to reply, the respondent is to notify the Court as soon as possible after Mr Bolton has filed his submissions.

3. [3]

   On 1 August 2025, the respondent filed an affidavit of Nicole Mouyat affirmed on that date, together with written submissions.

4. [4]

   Mr Bolton did not file any submissions or evidence in reply. On 7 August 2025, the respondent notified the Court (and Mr Bolton) by email that as Mr Bolton had not filed submissions or evidence there would be no submissions in reply. The respondent consented to the application being determined on the papers.

Relevant facts

1. [5]

   As we explained in our principal judgment, on 9 July 2025 Mr Bolton was joined by an order of Leeming JA as the second appellant to these proceedings which had been commenced by Yowie Group Limited (YGL). Following Mr Bolton’s joinder, YGL played no active part in the proceedings.

2. [6]

   On the afternoon of 16 July 2025, Mr Bolton’s then solicitors served an amended notice of appeal and written submissions signed by Mr Green SC.

3. [7]

   Ms Mouyat deposed that at 10.31am on 17 July 2025, the following letter was sent to Mr Bolton’s solicitors:

4. [8]

   No response to this letter was received by the respondent.

Submissions

1. [9]

   The respondent submitted that the following orders should be made:

2. [10]

   So far as r 20.26 of the Uniform Civil Procedure Rules 2005 (NSW) is concerned, paragraph (5) provides:

3. [11]

   The offer here was open for a period of four days. The case was heard in this Court with extraordinary dispatch, being closely case managed by Leeming JA, the subject of a hearing on 24 July 2025 and a detailed written judgment delivered on 30 July 2025.

Operation of UCPR r 20.26

1. [12]

   In Leda v Weerden (No 3) [2006] NSWSC 220, Gzell J dealt with a case where an offer under an earlier version of UCPR r 20.26 was open for four days close to the time of the trial. His Honour rejected submissions that the period of offer failed to comply with the reasonableness requirement and noted that the parties are in the best position to assess an offer when it is made shortly before the commencement of the trial:

2. [13]

   In Kooee Communications Pty Ltd v Primus Telecommunications Pty Ltd (No. 2) [2008] NSWCA 85, Basten JA (with whom Giles and Tobias JJA agreed on this point) found that an offer of compromise served immediately prior to trial which was open for a day was a “borderline” case and that the party seeking to establish an entitlement to indemnity costs failed to establish that its offer was left open for a reasonable time. His Honour noted the “three factors” the Court is to take into account in considering whether the time allowed for acceptance is reasonable in all the circumstances:

Consideration

1. [14]

   Division 4 (Compromise) of Part 20 of the UCPR applies (with necessary modifications to the language) to offers of compromise made in proceedings in the Court of Appeal: UCPR r 51.47. At the time the offer was made, we are satisfied on the basis of My Mouyat’s affidavit evidence that the respondent had already incurred significant costs in the appeal, including in preparing for the hearing of the appeal initially listed on 10 July 2025. There had been a number of directions hearings at which Mr Bolton’s expressed desire to intervene in the appeal had been canvassed. The respondent had commenced to consider the amended notice of appeal and written submissions had been served on behalf of Mr Bolton. The respondent was agreeing to forego something of substance, including the costs already incurred and the additional costs that the respondent would incur for the duration of the offer. In the present case, the respondent’s offer constituted a “compromise”.

2. [15]

   As to UCPR r 20.26(5), the offer was made within 28 days from the hearing of the appeal and was open for acceptance for a period of 4 days. The closing date of the offer was the date the respondent was required to file its written submissions. We have determined that the period was reasonable in the circumstances. First, the appeal was expedited and was set down for hearing 7 days later. Secondly, the offer was made promptly after Mr Bolton served his amended notice of appeal and submissions on 16 July 2025. Thirdly, the respondent was required to file submissions in response within 2 business days (and over a weekend) by 21 July 2025. The compressed timetable necessary to prepare the matter for urgent hearing meant that the parties were accruing significant costs on a daily basis.

3. [16]

   The relevant circumstances also include the fact that in Yowie Group Ltd v Keybridge Capital Ltd [2025] NSWCA 142, Leeming JA had described the principal grounds of appeal advanced as “weak at best”. Mr Bolton’s amended notice of appeal did not in our view affect that assessment. This was a case where at the time the respondent’s offer was made, Mr Bolton was in a position properly to assess the offer. At that time, his preparation for the appeal was essentially complete and his legal advisers were armed with sufficient information to make a reasoned judgment about the respondent’s offer. The period the offer was open for acceptance was reasonable in the circumstances.

4. [17]

   UCPR r 42.15A provides that, where a defendant’s formal offer of compromise is unreasonably rejected by the plaintiff, and the defendant obtains judgment which is no less favourable than the terms of the offer, then, “unless the court orders otherwise”, the defendant is entitled to: (i) costs on the ordinary basis up to the time that the offer was made; and (ii) costs on an indemnity basis thereafter. Satisfaction of the elements in UCPR r 42.15A therefore creates a “prima facie entitlement to indemnity costs” from the date of the offer: Leach v Nominal Defendant (QBE Insurance (Australia) Ltd) (No 2) [2014] NSWCA 391 at [40] (Leach); Houghton v Potts (No 3) [2023] NSWSC 69 at [16]; Chalik v Chalik [2025] NSWCA 136 at [136]. The unsuccessful party bears the onus of persuading the Court that indemnity costs should not be ordered: Leach at [29]; Snowy Mountains Grammar School Ltd v Adventurer AWD Pty Ltd [2022] NSWSC 53 at [4]. Mr Bolton did not provide the Court with any submissions opposing to the making of an indemnity costs order. The present offer attracts the operation of r 42.15A and there is no reason to “order otherwise”.

Conclusion and orders

1. [18]

   For the foregoing reasons the Court orders:

   1. (1)

      Set aside order 2 made on 30 July 2025 and in lieu thereof order: