Tuesday, 9 September 2008

Remember to make offers: NSW case

When property settlement proceedings are under way, most people make offers to settle because:
  • if you can settle a matter, save a bundle on legal fees and get out- you are ahead;
  • if you make an offer and do better than the offer at trial, then you might be able to get an order for costs in your favour, which should reduce some of the costs that you would otherwise have to pay.

There is then an incentive both to make offers to settle, and to consider very carefully any offers that are made.

In the recent New South Wales District Court case of Henriques v Fernandez, the court was considering a property settlement application under the Property Relationships Act. The court made an order in favour of the former de facto wife, the plaintiff. District Court Judge Johnstone held:

In this case it is evident that this plaintiff was required to commence these
proceedings to enforce her entitlement in respect of a division of the
assets. It is clear from the evidence before me, and from what I am told
from the bar table, which I accept, that at no time did the defendant
concede any entitlement on the part of this plaintiff to anything. The
evidence to the contrary is overwhelming and for those reasons it is
appropriate that this plaintiff be awarded costs. Indeed, had there been an offer of compromise, or a Calderbank letter I would have awarded indemnity costs. However, there is not.

(emphasis added)

In other words, if the plaintiff had made an offer to settle, she may have received substantially more in costs than she did.

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