6 Hodgson JA further cited from his own judgment in Commonwealth of Australia v Gretton [2008] NSWCA 117 at [121], the following passage:
"In my opinion, underlying both the general rule that costs follow the event, and the qualifications to that rule, is the idea that costs should be paid in a way that is fair, having regard to what the court considers to be the responsibility of each party for the incurring of the costs. Costs follow the event generally because, if a plaintiff wins, the incurring of costs was the defendant's responsibility because the plaintiff was caused to incur costs by the defendant's failure otherwise to accord to the plaintiff that to which the plaintiff was entitled; while if a defendant wins, the defendant was caused to incur costs in resisting a claim for something to which the plaintiff was not entitled: cf Ohn v Walton (1995) 36 NSWLR 77 at 79 per Gleeson CJ. Departures from the general rule that costs follow the event are broadly based on a similar approach."
His Honour described this passage as embodying the idea of fairness underlying the making of costs orders.
7 As I have said, in 5545/07, Gurbiel succeeded on three and failed on four out of seven claims. The four on which it failed included the largest single claim relating to the value of items let with the premises and not returned at the end of the lease.
8 The situation in this case is complicated by the fact this was a joint trial. While Gurbiel lost on four out of seven claims in one set of proceedings it succeeded completely in the other set of proceedings. The proceedings were interlocked by the fact that the amounts claimed by the plaintiffs in 15089/08 were also put forward as providing a set off in 5445/07. They were thus directly relevant also to that set of proceedings and they are to be included among the issues on which Gurbiel was successful in those proceedings. The greatest amount of the trial at the time was taken up by the issue of whether or not it was reasonable that Gurbiel should be allowed to retain the deposit paid under the contract for sale of land and, as I have said, on that issue Gurbiel succeeded.
9 The conclusion I have come to overall is that, in the circumstances, it is not possible easily to separate or divide out for separate costs treatment portions of the proceedings or the trial on which the Braune interests were successful. Bearing in mind all I have said about the overall conduct of the proceedings, I do not think that fairness requires that the generality of the order for costs in Gurbiel's favour in 5445/07 should be detracted from.
10 I turn then to the question of whether or not that result should be altered by reason of the Calderbank offer or offers that were made. It is well established that, to warrant departure from the ordinary rule on the basis of a Calderbank offer, the question is whether it was unreasonable for the offeree to refuse the offer: Jones v Bradley (No 2) [2003] NSWCA 258; Leichhardt Municipal Council v Green [2004] NSWCA 341.
11 I have already referred to the fact that the largest item on which the defendant in 5445/07 was successful was the claim in respect of items of equipment let with the premises and not returned. That claim exceeded all the other claims in the proceedings put together. It was not a claim on which the result was clear even at the commencement of the trial. It was a matter of some factual complexity and some legal complication and it was only after careful consideration that I came to the conclusion that the claim should fail.
12 Bearing this in mind, in all of the circumstances I do not come to the view that it was unreasonable for Gurbiel to refuse the offer made. As has been pointed out by counsel for Gurbiel, it is difficult to come in any event to come to the conclusion in the context of the complicated history of the proceedings that the offer which was made inclusive of costs was in fact better than the result ultimately achieved.
13 The result in all the circumstances is that I propose to order in each set of proceedings that Gurbiel should have an order for its costs of proceedings. Having determined those matters, I now proceed to make what I consider to be the appropriate orders in the proceedings.