Background
In this commercial proceeding, the Court had previously determined two interlocutory applications: the respondents’ application to amend their defences and withdraw an admission, and Hubexo’s application to adduce tendency evidence. Justice Needham reserved costs after deciding those applications in Hubexo Australia Pty Ltd v CoreLogic Australia Pty Ltd (Amendment of Defence and Tendency Notice) [2026] FCA 1310.
The parties agreed that the respondents should pay Hubexo’s costs of the amendment application, including costs thrown away, on an indemnity basis. Their dispute was whether those costs should be payable forthwith. On the tendency-evidence application, Hubexo sought its costs in the cause, while the respondents sought an order that each party bear its own costs in the cause.
The Court’s Holding
The Court ordered the respondents to pay Hubexo’s indemnity costs of the amendment application and costs thrown away, including costs of dealing with draft amended defences served between April and July 2026, as agreed or taxed forthwith. Justice Needham found that the respondents’ conduct concerning the late-realised error, the asserted admission, and candour to the Court was unreasonable. Immediate payment would reduce the prejudice caused to Hubexo by costs that should not have been incurred.
The Court excluded from the forthwith component any costs yet to be incurred in further calling witnesses on the copying allegation. Those costs remain payable by the respondents on an indemnity basis, but need not be agreed or taxed immediately. For Hubexo’s tendency-evidence application, the Court ordered costs in the cause, concluding that the parties had achieved reasonably equal success.
Key Takeaways
- Unreasonable conduct in seeking to amend a defence and withdraw an admission can justify indemnity costs payable forthwith.
- A forthwith costs order may be used to reduce prejudice from costs caused by a party’s belated pleading error.
- Where an evidentiary application produces mixed and broadly equal success, costs may be left to the outcome of the proceeding.
Why It Matters
The decision illustrates that costs orders are directed to compensating litigation prejudice, not punishment. A party that discovers a pleading error must address it promptly and candidly; otherwise, it may be required to meet the other side’s indemnity costs immediately.
It also shows that success on an interlocutory evidentiary application is assessed practically. Even where an applicant obtains some relief, costs may remain in the cause if the application involved meaningful unsuccessful issues.