Background
This was a costs determination following the Court of Appeal’s disposition of an earlier appeal in Jason H Pty Ltd as trustee for the Jason H Family Trust v Habchi [2026] QCA 172. The appellants had been partially successful: their challenge concerning question 3 failed, although the Court amended the primary judge’s order to clarify the answer; they succeeded wholly concerning question 5A.
After principal submissions had been exchanged and shortly before the scheduled appeal hearing, the respondents offered to settle. The offer proposed upholding ground 12, setting aside order 1(c) made below, otherwise dismissing the appeal, and making each party’s appeal costs its costs in the combined proceedings below. The appellants did not accept the offer within its seven-day period.
The Court’s Holding
The Court declined to order the appellants to pay the respondents’ appeal costs. Although the respondents’ submission had considerable force and the settlement proposal substantially resembled the eventual result, the offer did not make any allowance for the appellants’ costs already incurred by the advanced stage of the appeal.
The Court also considered that acceptance would have prevented correction of the defect in the answer to question 3(b)(ii), albeit that was a minor factor. Seven days was not shown to have been enough time for the appellants’ advisers to consider the offer and provide proper advice. Balancing the appellants’ partial success against avoidable post-offer preparation costs, the Court ordered that the appellants’ costs of the appeal be their costs in the proceedings below.
Key Takeaways
- A settlement offer substantially matching the outcome does not automatically justify an adverse costs order.
- The timing of an offer and its treatment of costs already incurred are material to whether rejection was unreasonable.
- A short acceptance period may be insufficient to determine costs where adequate time for advice is not established.
Why It Matters
The decision illustrates the discretionary and practical nature of appellate costs orders. Parties relying on a late settlement offer should ensure it gives a realistic costs outcome and sufficient time for informed consideration.