In the matter of Jodegan Pty Limited (No 2)

BARRETT AJA: I am dealing with the question of costs in consequence of judgment delivered on 10 August 2016: In the matter of Jodegan Pty Limited [2016] NSWSC 1090.

The plaintiff failed in its attempt to obtain an order setting aside the statutory demand served by the defendant but was successful to the extent of establishing the existence of a genuine dispute as to one of the two debts the subject of the demand. Genuine dispute was established as to the $72,646.75 element but not as to the $13,296.66 element. The amount of the statutory demand was reduced accordingly.

The plaintiff says that, on the basis that costs follow the event, it should have a costs order. The defendant’s contention is that, on the basis that costs follow the event, it should have a costs order. Both cannot be right.

The truth is that each party achieved a measure of success. There were two debts. Different considerations applied to each. Any suggestion that the relative magnitude of the debts has any bearing on the costs question cannot be accepted. Nor is it possible to say that one involved more evidence or argument than the other. An appreciation of the whole of the contractual relationship and its dispute resolution mechanism was necessary in relation to both debts.

In those circumstances, I am of the opinion that a just outcome is that each party should bear its own costs.

That being so, the further question whether costs awarded to the plaintiff should be assessed on an indemnity basis does not arise. I would, however, observe that an offer to settle the overall debt claims for a particular sum (being an offer made before the statutory demand had been served) cannot be relevant to the question of costs of proceedings in which the question is confined to the existence of genuine dispute subsequent. The court makes no order as to costs to the extent that each party should bear its own costs of the proceedings.