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[2026] ACTSC 230
Supreme Court of the ACT
2026-07-08
Muller J
Original judgment source is linked above.
Source: the ACT Courts (www.courts.act.gov.au). Converted to plain text by ZoeLaw. Not the official version.
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: Huber v Williams Love and Nicol Lawyers Pty Ltd (No 2) Citation: [2026] ACTSC 230 Hearing Date: On the papers Decision Date: 8 July 2026 Before: Muller J Decision: See [21] Catchwords: PRACTICE AND PROCEDURE – COSTS – Whether defendant entitled to a costs order – whether indemnity costs should be awarded – whether refusal of offer made under Calderbank principles unreasonable – whether legal practitioner entitled to recover their own costs – usual order as to costs made on party-party basis Legislation Cited: Court Procedures Rules 2006 (ACT), rr 1705, 1721 Cases Cited: Cachia v Hanes (1994) 179 CLR 403 Elite Protective Personnel v Salmon (No 2) [2007] NSWCA 373 Gray v Richards (No 2) [2014] HCA 47; 89 ALJR 113 Hulanicki v Walton (No 2) [2015] ACTCA 45 Kone Elevators Pty Ltd v Shipton [2021] ACTCA 33 Oshlack v Richmond River Council [1998] HCA 11; 193 CLR 72 Vizovitis v Ryan (No 2) [2014] ACTSC 301 Parties: Marie-Luise Huber (Plaintiff) Williams Love and Nicol Lawyers Pty Ltd, as trustee for the WLBT Unit Trust, trading as BAL Lawyers (Defendant) Representation: Counsel Self-represented (Plaintiff) C McFadyen (Defendant) Solicitors Self-represented (Plaintiff) Legalcost Lawyers (Defendant) File Number: SC 60 of 2025 MULLER J:
I delivered my decision in this matter on 27 March 2026, with orders in the following terms: (1) The application to set aside the first and second agreements pursuant to s 288 of the Legal Profession Act 2006 (ACT) is refused. (2) The application to declare the agreements void for unfair contract terms or on the basis of unconscionability is refused. (3) The plaintiff has leave pursuant to s 294A of the Legal Profession Act 2006 (ACT) to apply for an assessment of part of her legal costs as follows: a. Invoice B34094 dated 11 December 2018. b. Invoice B61759 dated 11 January 2024. c. Invoice B63143 dated 29 April 2024.
The parties were directed to file written submissions in relation to costs with that issue to be determined on the papers. I make the following orders in relation to costs and my reasons are set out below: (1) The plaintiff is to pay the defendant’s costs of the proceedings on a party-party basis. (2) On or before 22 July 2026, the plaintiff is to file and serve any application for assessment of the invoices in respect of which leave was granted in order 3 of my decision dated 27 March 2026. (3) The matter is listed for further directions before the Registrar on 31 July 2026 at 9.30 am.
The primary proceedings were themselves concerned with a dispute about costs. Ms Huber retained Williams Love and Nicol Lawyers (BAL) to act on her behalf in two employment disputes with her former employer, IP Australia. After those matters were finalised, Ms Huber disputed the legal costs BAL required her to pay. In her originating application, she sought 24 separate orders in relation to the two costs agreements relied upon by BAL.
The essence of her application was a request for each of the costs agreements to be set aside. In relation to the first costs agreement, her application failed because I found it to be statute barred as a consequence of relevant limitation laws. In relation to the second costs agreement, her application was largely unsuccessful, although I gave her leave to apply for an assessment of part of the legal costs in three of the invoices she received from BAL. Ms Huber has calculated the fees in those invoices to comprise approximately 15% of the total fees she was charged by BAL. I have not been informed Ms Huber has proceeded with an application for assessment of those invoices. The competing positions
Ms Huber argues for an order that each party bear their own costs or alternatively that costs are apportioned. She says indemnity costs are not warranted.
BAL says Ms Huber should be ordered to pay their costs on an indemnity basis. Alternatively, they seek their costs on a party-party basis. In support of the request for indemnity costs, they rely on a Calderbank offer served on Ms Huber on 28 May 2025 offering resolution in the following terms: My client offers to resolve all disputes between you and BAL Lawyers on the following basis: 1. BAL agrees to abandon their claim for unpaid fees. 2. BAL discontinues ACAT proceedings XD 854 of 2024 with no order as to costs. 3. You discontinue proceedings SC 60 of 2025 with no order as to costs. 4. Both parties agree to enter into a deed releasing BAL Lawyers from any and all future claims arising directly or indirectly out of their engagement of you and both parties agree to keep all matters relating to the deed strictly confidential.
Relative to the timeline of the proceedings, the Calderbank offer was made after the filing of Ms Huber’s originating application and first affidavit and before the filing of any evidence or submissions on the part of BAL. The offer was open for acceptance until 25 June 2025, at which time BAL was yet to put on any evidence or submissions.
Ms Huber points to the following matters in support of her position: (a) She achieved some success in obtaining leave to seek a costs assessment for three invoices. (b) Leave was given on the basis of some uncertainty as to whether BAL may have charged twice for the same body of work. (c) There was thus a substantive finding going directly to the propriety of BAL’s billing practices. (d) To the extent the offer by BAL required a global release of all present and future claims, it was seeking broader forensic advantages and was not limited to the subject matter of the proceedings. (e) There was a proper basis for contesting BAL’s charging, borne out by the Court’s decision to allow an assessment of some of the bills. (f) Had Ms Huber accepted the offer, she would have been denied a legitimate avenue of scrutiny of those bills. (g) BAL did not provide an outline of its position until 28 August 2025, some six months after the filing of the originating application. Ms Huber describes this document as BAL’s defence but a defence was never filed; nor was it required pursuant to the Court Procedures Rules 2006 (ACT). (h) When the limitation defence was raised, Ms Huber was given only 24 hours to respond. (i) BAL was in breach of court directions in relation to filing of its documentation and the delay caused significant prejudice to Ms Huber. (j) On the subject of indemnity costs, BAL has not demonstrated that Ms Huber acted unreasonably in rejecting their offer.
The arguments relied upon by BAL are: (a) Ms Huber was largely unsuccessful in her claim, with leave granted to apply for an assessment of only three of the 58 invoices issued by BAL, and her various other claims dismissed. (b) Of those three invoices, one was still open to be disputed at the time of the hearing and another was open to be disputed when BAL commenced ACAT proceedings for recovery of their costs. (c) BAL made a genuine attempt to resolve the matter in the form of its Calderbank offer.
What are the general principles in determining costs?
First and foremost, the Court has a broad discretion in making an order for costs: r 1721 of the Rules. It is a discretion to be exercised carefully as opposed to arbitrarily, in line with established principle, and guided by the result of the litigation: Oshlack v Richmond River Council [1998] HCA 11; 193 CLR 72 at [22] (Gaudron and Gummow JJ), [65] (McHugh J). The ordinary rule is that costs will follow the outcome: Kone Elevators Pty Ltd v Shipton [2021] ACTCA 33 at [294] (Murrell CJ, Loukas-Karlsson and Stewart JJ); although the Court is clearly empowered to award only a portion of the costs where the outcome is mixed: r 1705 of the Rules. Where there are competing considerations, a broad evaluative assessment is called for: Gray v Richards (No 2) [2014] HCA 47; 89 ALJR 113 at [2].
The approach to be taken in the context of compromise offers was helpfully summarised in Hulanicki v Walton (No 2) [2015] ACTCA 45 at [13]-[16] (Murrell CJ, Refshauge and Penfold JJ): [13] The acceptance of reasonable offers of compromise is in the interests of litigants and the public; it minimises the personal and financial costs to litigants and it enables the courts to focus resources on claims that are not amenable to compromise. “The non-acceptance of a Calderbank offer is a factor, in some cases a strong factor, to be taken into account on an application for indemnity costs”: Stewart v Atco Controls Pty Ltd (In Liquidation) (No 2) (2014) 252 CLR 331 at [4]. On the other hand, it is critical that litigants have ready access to justice and do not feel unreasonably constrained to compromise cases. [14] When a Calderbank offer has been made, the issue is whether it was unreasonable to reject the offer, considering all the circumstances of the case, including the apparent strength of each party's case at the time that the offer was made: Quirk v Bawden (1992) 112 ACTR 1 at 6; Leichhardt Municipal Council v Green [2004] NSWCA 341 at [56]; South Eastern Sydney Area Health Service v King [2006] NSWCA 2 at [90]. In Hazeldene's Chicken Farm Pty Ltd v Victorian Workcover Authority (No 2) (2005) 13 VR 435 at [25] the Victorian Court of Appeal noted that other matters that should be taken into consideration when evaluating the reasonableness of a rejection are: “(a) The stage of the proceeding at which the offer was received. (b) The time allowed to the offeree to consider the offer. (c) The extent of the compromise offered. (d) The offeree's prospects of success, assessed as at the date of the offer. (e) The clarity with which the terms of the offer were expressed. (f) Whether the offer foreshadowed an application for indemnity costs in the event of the offeree's rejecting it.” [15] Even where it is found that a Calderbank offer should have been accepted and the offeree achieves a result that is no better than the offer, it does not automatically follow that indemnity costs will be awarded against the offeree: Evans v Braddock (No 2) [2015] NSWSC 518 at [49]. [16] The applicant for indemnity costs bears the onus of showing that rejection of the offer was unreasonable: Evans Shire Council v Richardson (No 2) [2006] NSWCA 61 at [26]; Vizovitis v Ryan (No 2) [2014] ACTSC 301 at [17]. Is the defendant entitled to an order for costs?
The outcome of the proceeding brought by Ms Huber was, in the overall sense, a dismissal of her claims. To the extent she secured orders giving her leave to require an assessment of costs, the value of those invoices was approximately 15% of the total amount sought for costs. It remains unclear whether, upon assessment, Ms Huber will succeed in reducing those costs in any significant degree.
Where, as is the case here, a particular proceeding involves multiple issues, the Court will not usually attempt to tease out those issues upon which a party was successful and upon which they failed unless there is an identifiable separate issue which took up a significant part of the trial: Elite Protective Personnel v Salmon (No 2) [2007] NSWCA 373 at [6] (Beazley, McColl and Basten JJA). I do not consider it appropriate in this instance to attempt to identify the court time that may have been spent dealing with the component of Ms Huber’s claim that delivered her some modest success. In the overall sense, she was unsuccessful and she should pay the defendant’s costs as a result.
It is then necessary to deal with BAL’s Calderbank offer and their submission for payment of costs on an indemnity basis.
Was a genuine compromise proposed?
Did Ms Huber unreasonably reject the Calderbank offer?
In answering that question, it is necessary to first be satisfied the outcome for BAL is better, or at least no worse, than the outcome comprised in their Calderbank offer. That satisfaction is not readily achieved for two reasons: (a) Ms Huber has leave to challenge the unpaid invoices and she may be successful in that regard, in which case, the waiver of BAL’s right to pursue payment of them may place them in no better position. (b) It was a term of the offer that Ms Huber release BAL from “any and all future claims arising directly or indirectly out of their engagement”. That was a condition sitting outside the subject matter of the proceedings. There is no evidence before me to enable me to assess whether an agreement with Ms Huber whereby she gave up that right was an agreement of real value when compared with the outcome in the proceedings, where Ms Huber retains the right to pursue future claims arising out of BAL’s engagement.
On an application for indemnity costs, the party seeking the special costs order has the onus of establishing the opposing party acted unreasonably in failing to accept the offer: Vizovitis v Ryan (No 2) [2014] ACTSC 301 at [17] (Master Harper). BAL has not placed evidence before me to demonstrate the outcome in the proceedings is better or no worse for them than the outcome they would have achieved if their offer of compromise was accepted.
I cannot be satisfied that Ms Huber acted unreasonably in not accepting the offer made by BAL. As a consequence, BAL have not established the special circumstances required to justify an order for costs on an indemnity basis.
I am mindful to the extent BAL may have incurred costs internally in preparing and conducting their case, those costs are not recoverable. BAL is limited to recovery of monies paid or liabilities incurred for professional legal services: Cachia v Hanes (1994) 179 CLR 403 at 409 (Mason CJ, Brennan, Deane, Dawson and McHugh JJ).
BAL has requested an additional order limiting the time within which Ms Huber is able to make any application for assessment of the invoices for which leave has been granted. Such an order appears sensible in the circumstances with a view to bringing the matters in dispute to a close.
Orders
I certify that the preceding twenty-one [21] numbered paragraphs are a true copy of the Reasons for Judgment of his Honour Justice Muller.
Associate: Date:
Huber
Williams Love and Nicol Lawyers Pty Ltd (No 2)
[1998] HCA 11
(1994) 179 CLR 403
(2014) 252 CLR 331
(2005) 13 VR 435