JUDGMENT OF: His Honour Deputy President Judge Calligeros

Costs dispute following orders being made after delivery of judgment - The applicant seeks indemnity costs from the respondents - HELD: 1. Each respondent is liable to pay the applicant's costs on a party and party basis and it is appropriate that they do so in equal proportions - 2. The applicant is entitled to receive the difference between his party and party costs and his indemnity costs from the first respondent from 10 July 2025 as the evidence of its own witness on 26 June 2025 undermined its case and made it apparent that the applicant would succeed - There was relevant delinquency in failing to make an offer to the applicant 14 days after 26 June 2025 - 3. The claim for indemnity costs against the second respondent is dismissed - 4. The first respondent is entitled to the costs of the third party action against the third and fourth third parties on a party and party basis - 5. The third and fourth third parties are not liable to contribute to the first respondent's liability to pay the costs of the applicant.

Mutual Community Limited v Lorden Holdings Pty Ltd & Ors (28 April 1993, unreported)

John Holland Constructions & Engineering Pty Ltd v Majorca Projects Pty Ltd & Anor (1 November 1996, unreported)

Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72

Holt v Bunney (No 2) [2020] SASCFC 120

Fountain Selected Meat (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397

Colgate-Palmolive Company v Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225

Hazledene's Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) [2005] 13 VR 435

Nominal Defendant v Dighton (No 2) [2012] SASCFC 97

Phantom Precision Engineering Pty Ltd v Luscombe (No 2) [2021] SASC 103

Viscariello v Macks (No 3) [2021] SASC 69

Gerson v Simpson Reitlinger and Others, Third Parties (1903) 2 KB 197

Simpson v British Industries Trust Ltd (1923) 39 TLR 286

Jerred and Others v T Roddam Dent & Son Ltd; (Glen Line Ltd Third Party) [1948] 2 All ER 104

Sinclair v William Arnott Pty Ltd (No 2) (1963) 64 SR (NSW) 88

Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534

Knight v Clifton [1971] Ch 700

Australian Transport Insurance Pty Ltd v Graeme Phillips Road Transport Insurance Pty Ltd (1986) 71 ALR 281

First Respondent: Mr M Roberts KC with Ms E Denbigh

1. Orders were made in this proceeding on 19 November 2025 after a hearing. The issue of who should bear the costs of the proceeding, and on what basis, could not be resolved by the parties and written submissions on costs were filed and argument was heard on 19 December 2025.

1. David Miller brought an action for damages in negligence under the Dust Diseases Act 2005 (DD Act) against two respondents. Mr Miller proved that the respondents negligently caused him to suffer malignant peritoneal mesothelioma and was awarded damages of $2,210,824.20.
2. The respondents are the State of South Australia (the State), and Amaca Pty Ltd (Amaca). Under s 6 of the Law Reform (Contributory Negligence and Apportionment of Liability) Act 2001 (LR Act), liability was apportioned 80% against the State and 20% against Amaca excluding the award of exemplary damages made against each respondent.
3. The State brought third party proceedings against Bradford Insulation (Contracting) Pty Ltd (BIC) and Bradford Insulation (SA) Pty Ltd (In Liquidation) (BISA). BIC and BISA collectively are referred to in these reasons as BI. BI was found liable for 40% of the damages payable by the State to Mr Miller, excluding the exemplary damages payable by the State.

1. On 9 December 2024, Mr Miller filed a Formal Offer to accept judgment for $2,250,000 against both respondents. The offer was made without prejudice, save as to costs. On 17 December 2024 Amaca filed a response to the Formal Offer, advising that it was not accepted and asserting that it was not capable of acceptance by one party in the absence of the other party being an offeree. Amaca also stated that making discovery and obtaining expert evidence had not been completed. Mr Miller filed a Formal Offer in the same amount against each respondent separately on 19 December 2024. The State and Amaca each filed a response which did not accept the offer and asserted that the offer did not comply with r 132.4 of the Uniform Civil Rules 2020 (UCR) because the pleadings were open, discovery was in train and liability and quantum could not be assessed.
2. On 2 April 2025, after 4 hearing days, Mr Miller wrote to each respondent advising that he would accept $2,000,000 plus costs and disbursements to resolve his claim. The offer was made in accordance with the principle in Calderbank v Calderbank,[1] and remained open for 14 days. The State rejected Mr Miller's Calderbank offer by letter dated 11 April 2025.
3. By letter dated 2 April 2025, the solicitor for Amaca wrote to the solicitor for the State in relation to Mr Miller's Calderbank offer in these terms:

Our client considers the Applicant's offer represents a reasonable compromise of the quantum of his claim. It considers that offer should be accepted.

The only issue preventing acceptance of the Applicant's offer is apportionment between the Respondents. Based on the evidence adduced, Amaca is prepared to contribute 5% up to $2,000,000.00 plus 5% of costs and disbursements to be agreed or taxed on a full and final basis.

lf your client can negotiate a better settlement with the Applicant than his current offer, Amaca offers to contribute 5% of that settlement up to $2,000,000.00 plus 5% of costs and disbursements to be agreed or taxed on a full and final basis.

Amaca will not participate in any further negotiations and does not permit this offer being disclosed to any of the other parties prior to settlement being agreed with the Applicant.

lf Amaca's offer is accepted by 5 pm on Thursday 17 April 2025, then Amaca will bear its own costs of the proceedings to date and agree to a mutual discontinuance of the contribution claims between our clients on the basis that our respective clients each bear their own costs.

lf Amaca's offer is not accepted by your client prior to 5 pm on Thursday 17 April 2025, and Amaca achieves better apportionment of liability, and the Applicant is awarded more than his offer, Amaca will claim costs from your client on an indemnity basis from close of business on 17 April 2025.lt will also argue that the Applicant's costs incurred after close of business on Thursday 17 April 2025 should be paid by your client.

This offer is made in accordance with the principles established in Calderbank v Calderbank [1975] 3 All ER 333 and Cutts v Head [1984] Ch 290 and adopted by the Supreme Court of Victoria in Mutual Community Limited v Lorden Holdings Pty Ltd & Ors (28 April 1993, unreported) and John Holland Constructions & Engineering Pty Ltd v Majorca Projects Pty Ltd & Anor (1 November 1996 unreported).

1. By email dated 8 April 2025 Amaca's solicitor provided Mr Miller's solicitor with a copy of Amaca's Calderbank offer to the State of 2 April 2025.

The State rejected the Calderbank offers made by Mr Miller and Amaca by letters to each of them dated 11 April 2025.

1. In his written submissions, Mr Miller sought the following orders:[2]

(a) The first respondent is to pay the applicant's costs on the indemnity basis, to be agreed or taxed;

(b) In the alternative to (a), the first respondent is to pay the applicant's costs on the standard costs basis until 1 April 2025 and thereafter on the indemnity basis, to be agreed or taxed; and

(c) The second respondent is to pay the applicant's costs on the standard costs basis until 1 April 2025 and thereafter on the indemnity basis, to be agreed or taxed.

1. Order (a) was said to be appropriate because the State acted unreasonably and/or acted with "relevant delinquency"[3] in:[4]

(i) making positive allegations (including that it had instituted and enforced a system of work at the RAH by which employees of Manpower were inducted, trained and educated about the widespread presence of asbestos and its potentially lethal dangers) which the State ought reasonably to have known were not true;

(ii) in the absence of providing the Court with any explanation that included "granular detail" about when it began the process of discovery and the nature and extent of the resources it devoted to this important task - breaching orders for provision of timely discovery leading to significant delay and increases in costs in circumstances where Mr Miller's Statement of Claim was filed and served upon it in July 2024 and, where the State had previously been sued in respect of allegations of exposure at the RAH and provided discovery in those cases.

1. Order (b), which is in the alternative to order (a) in relation to the State, is based upon Mr Miller's Calderbank offer. Mr Miller submitted that it should have been obvious to the respondents that he "would almost certainly win his case and recover damages in excess of $2,000,000".[5] He added that because of joint and several liability, ether respondent could have settled with Mr Miller and then pursued the other for contribution.
2. Mr Miller referred to r 194.6 of the UCR which provides:

(1) In exercising its discretion as to costs, the Court may have regard to any factors it considers relevant.

(2) For example, the Court may have regard to the following factors―

(a) any misconduct or unreasonable conduct of a party in connection with a proceeding;

(d) the making or not making of an offer by a party to resolve the proceeding;

(e) the non-acceptance by a party of an offer made by another party to resolve the proceeding;

...

(h) whether costs awarded are to be met by a person or out of a fund.

1. Mr Miller referred to Holt v Bunney (No 2),[6] where the Full Court of the Supreme Court stated that there remains a broad, unfettered discretion in relation to costs under r 194.6 of the UCR, which must be exercised judicially.[7] Reference was also made to this passage in Fountain Selected Meat (Sales) Pty Ltd v International Produce Merchants Pty Ltd:[8]

I believe that it is appropriate to consider awarding "solicitor and client" or "indemnity" costs, whenever it appears that an action has been commenced or continued in circumstances where the applicant, properly advised, should have known that he had no chance of success. In such cases the action must be presumed to have been commenced or continued for some ulterior motive, or because of some wilful disregard of the known facts or the clearly established law. Such cases are, fortunately, rare. But when they occur, the court will need to consider how it should exercise its unfettered discretion.

1. In Colgate-Palmolive Company v Cussons Pty Ltd,[9] Sheppard J said the following about awarding indemnity costs or solicitor and client costs:[10]

Notwithstanding the fact that that is so, it is useful to note some of the circumstances which have been thought to warrant the exercise of the discretion... the making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions ... an imprudent refusal of an offer to compromise ... and an award of costs on an indemnity basis against a contemnor ... Other categories of cases are to be found in the reports. Yet others to arise in the future will have different features about them which may justify an order for costs on the indemnity basis. The question must always be whether the particular facts and circumstances of the case in question warrant the making of an order for payment of costs other than on a party and party basis.

1. In Hazledene's Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2),[11] the Victorian Court of Appeal listed the following non-exhaustive criteria as relevant to whether the rejection of a Calderbank offer was unreasonable:[12]

(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; [and]

(f) whether the offer foreshadowed an application for an indemnity costs in the event of the offeree's rejecting it.

1. The Full Supreme Court of this State adopted those criteria in Nominal Defendant v Dighton (No 2).[13] In Phantom Precision Engineering Pty Ltd v Luscombe (No 2),[14] Lovell J held that the onus of proving the rejection of a Calderbank offer was unreasonable rests with the party seeking indemnity costs.[15]

1. The State contends that there is no justification for an award of indemnity costs and there has been no relevant delinquency on the part of the State. The State maintains that the rejection of Mr Miller's Calderbank offer does not justify an award of indemnity costs being made from 2 April 2025 or some specified time thereafter.
2. The State submitted that the appropriate order is that the respondents should meet Mr Miller's claim for costs in equal shares.
3. Reference was made by the State to Viscariello v Macks (No 3),[16] where Norman AuJ stated:[17]

The ordinary rule is that the court should award costs on a standard cost basis unless the circumstances of the case must be such as to warrant the court in departing from the usual course.

The court may only award indemnity costs where the justice of the case warrants such an order. Likewise, an award of such costs will only be made where there are circumstances that are special and unusual.

Instances where indemnity costs might be awarded include where there are circumstances that are special or unusual, or involve some irrelevant (sic) delinquency on the part of the successful party.

The categories in which such costs can be awarded are not closed.

In the general trial context, a case does not necessarily have to be hopeless, that is have no chance of success, but it is sufficient if it proceeds without apparent regard to the significant deficiencies in its evidence. However, there is nothing in itself improper or unreasonable in the pursuit of claims involving legal difficulty...

**(**Citations omitted)

1. In dealing with the respective liabilities of the State and Amaca for costs, the State submitted that there is no proper basis for it to be ordered to bear costs independently of Amaca because both respondents were found liable. To the extent that Amaca relies on the Calderbank offer that it made, the State maintained it was a "walk away" offer that precluded any attempt to compromise the 95% to 5% liability split offered by Amaca.[18]
2. In relation to the "relevant delinquency" argument advanced by Mr Miller, the State submitted that because indemnity costs are sought from prior to when Mr Miller's Calderbank offer was made, it would be unjust to punish the State with indemnity costs in that period.
3. The State submitted that the evidence in relation to training and inducting contractors like Mr Miller was not so baseless or delinquent to justify an award of indemnity costs. While the lay witnesses called by Mr Miller, electricians who also started working at the Royal Adelaide Hospital (RAH) whilst employed by a labour hire firm (the Manpower electricians) said that they received no asbestos training and no induction, Mr Ted Carlaw gave evidence for the State and stated that he provided inductions and recalled Luke Barnard doing so as well. Mr Reynolds also gave evidence to that effect.
4. The State also submitted that Mr Miller did not contend that the failure to educate or induct in isolation amounted to a breach of a duty of care. The State maintained it was arguable that it had had done enough to discharge its duty of care:[19]

...What failings were proven, and then whether this combination of proven failings meant that the first respondent breached its duty of care is a legally complex question which required judicial determination. The scope of an occupier's liability and whether the provision of training to employees of a contractor not employed by the occupier falls within the ambit of the requisite duty is similarly a legally complex question requiring judicial determination.

1. The State referred to the submissions it made in relation to Mr Miller's credibility. The submissions included Mr Miller maintaining that he was exposed to asbestos at the RAH to a much greater degree than the degree of exposure that the Manpower electricians described.

• 25 The State also referred to its argument that it was not within the standard of care in its capacity as an occupier to provide training to contractors.[20] It observed that there has been no judicial consideration of occupier's liability in this State in relation to asbestos, or any consideration of a duty to train the employees of a contractor, until now.

1. In relation to the complaint made about the State's discovery, the State submitted that it did not breach orders for the provision of discovery by reference to the sequence of events and the orders made.[21]
2. Turning to the alternative costs order sought by Mr Miller based upon his Calderbank offer, the State submitted that there is "no presumption that a Calderbank offer gives rise to a presumption in favour of indemnity costs if it is exceeded".[22]
3. The State contended that the rejection of Mr Miller's Calderbank offer was not unreasonable for two reasons. Firstly, the terms of the offer were unclear as to whether a unilateral acceptance or a joint acceptance was sought. After the costs argument the State observed that it appeared that Mr Miller meant a joint acceptance, meaning one respondent would be liable for the judgment sum and costs and would then have to pursue the other respondent for contribution. Secondly, the State submitted that Mr Miller's Calderbank offer was made late and the amount by which the offer was exceeded does not make its rejection unreasonable.
4. In relation to the third party claim against BI, the State submitted that there is no reason to depart from the usual position that it should have the costs of that action from BI.
5. The State filed further written submissions dated 10 December 2025 seeking a 40% contribution from BI to the State's liability to Mr Miller for costs. The State submitted there is power to make an order of that kind.[23] The State submitted that BI strongly contested that it was a tortfeasor for the purposes of s 6(1) of the LR Act on the basis that it did not owe a duty of care to Mr Miller, and if it did, that there was no breach. In response to that stance the State contended "[t]hat a duty was owed by BI to people within a class that included Mr Miller was undeniable".[24]
6. The State's written submissions in response to BI's costs submissions are set out later.

1. Amaca's written submissions on costs are dated 2 December 2025. Amaca made no submission in relation to Mr Miller seeking indemnity costs from the State.
2. In relation to the third proposed costs order sought by Mr Miller, Amaca submitted that Mr Miller must demonstrate that Amaca was unreasonable in not accepting his offer of 2 April 2025. Because the State showed no interest in settlement, Amaca maintains that it could only have resolved the claim by accepting total liability and then running a cross-claim against the State. Doing so would have involved calling witnesses that Mr Miller relied upon whose evidence Amaca had little knowledge of. Given that scenario, Amaca submitted that the usual costs orders should be made save that Mr Miller should not have his costs of the indemnity costs application from Amaca.
3. In relation to the Formal Offer filed by Mr Miller on 9 December 2024, Amaca's response was that the offer could not be accepted without agreement between both respondents and BI. Amaca submitted that given the State refused to try to settle Mr Miller's claim at all, and given the potency of the asbestos he was exposed to at the RAH was much greater than that of the asbestos Amaca was responsible for, Mr Miller cannot prove that it was unreasonable for Amaca to not unilaterally accept his Calderbank offer.
4. Amaca submitted that the costs orders made should have regard to its attempts to resolve the matter by initiating negotiations with the State and by indicating to the State that it considered the quantum of Mr Miller's Calderbank offer was reasonable and should be accepted.
5. Amaca submitted that Amaca took reasonable issue with the claim and defended the claim reasonably.

1. In support of its submissions as to costs, BI relied on the affidavit of Airlie Hamilton which deposes that during the life of the litigation, Ms Hamilton never received correspondence from the State in relation to matters such as:

(a) the quantum of Mr Miller's claim;

(b) the State's liability in respect of Mr Miller's claim;

(c) any offers made by Mr Miller to the respondents (jointly or separately);

(d) the State's view on apportionment of liability on its contribution to BIC/BISA.

1. Ms Hamilton deposed that she did not become aware of Amaca's letter to the State dated 2 April 2025, in which Amaca advised that it considered the quantum of Mr Miller's Calderbank offer was reasonable and should be accepted, until 10 November 2025.
2. Ms Hamilton also deposed that in her more than 10 years of experience with dust diseases litigation, offers are often a catalyst for further offers and do not necessarily reflect the final position of a party. I interpolate that may be the case even where the party states that the offer is final.
3. BI submitted that "[t]he State elected to proceed to trial in the face of multiple reasonable offers made by the Applicant".[25] BI observed that the award of damages made was only 1.7% less than Mr Miller's filed offer. It stated that there was another opportunity to resolve the claim by accepting Mr Miller's Calderbank offer. BI submitted that if an order for costs is made against BI, it should have regard to the State's failure to accept multiple offers, participate meaningfully, or at all, in settlement negotiations or make any offer of settlement to any party.
4. BI emphasised that the acceptance of either offer made by Mr Miller could have avoided a long and expensive trial. While it could not be known whether a settlement could have been reached, BI stated that settlement "cannot be reached where a party refuses to negotiate at all".[26] BI added that for the purposes of making costs orders, the reason why the hearing proceeded "was the failure of the State to accept any of the offers made by [the] Applicant".[27] BI essentially agreed with Mr Miller it was unreasonable to allow the matter to proceed to judgment given exhibit A2, photographs of the RAH taken in May 1994 and May 1995 which showed crocidolite in ceiling spaces, risers and the catacombs, places where Mr Miller and the Manpower witnesses said that they had encountered crocidolite, the 2007 asbestos audit report which showed asbestos was still present in the RAH in 2007. BI contended that the State's failure to make any offer to Mr Miller or any other party was unexplained.
5. In relation to Amaca, BI submitted that Amaca's position in relation to Mr Miller's Calderbank offer was deliberately withheld from BI. BI's solicitor did not receive a copy of Amaca's 2 April 2025 letter until 10 November 2025 when it was disclosed for the purposes of the costs argument. Notwithstanding that, BI disagreed with the State's submission that Amaca's willingness to accept Mr Miller's Calderbank offer has to be conditioned by its non-negotiable stance on liability:[28]

It is no answer for the State to say that Amaca was unwilling to negotiate based upon certain correspondence from Amaca. The liability of each of the State and Amaca is joint and several. There is no legal requirement for an agreement amongst all respondents for one respondent to accept an offer by an applicant. Further, there was never a reasonable possibility that Amaca would bear more of the liability to the Applicant than the State.

1. BI opposes an order that it contribute to any liability of the State in respect of Mr Miller's costs. In the alternative, if BI is found liable to contribute to the State's liability for Mr Miller's costs, that contribution should be limited to:[29]

(a) the costs that were incurred by the Applicant to the date upon which the State ought to have accepted the Applicant's settlement offer, being either;

(i) 23 December 2024, being the date of expiry of the Applicant's Formal Offer of 9 December 2024 to both the State and Amaca;

(ii) 2 January 2025, being the date of expiry of the Applicant's Formal Offer of 19 December 2024 to the State;

(iii) 2 April 2025, being the date upon which the Applicant made his offer to accept $2,000,000 plus costs, which was capable of acceptance by either or both of the State or Amaca;

(iv) Such other amount as is fair and equitable having regard to the role of each in the continuation of the Applicant's action.

(b) that which would be payable to the Applicant on a standard costs basis (irrespective of any order for indemnity costs payable by the State).

1. BI submitted that it never received correspondence or advice from the State about the quantum of Mr Miller's claim, the State's liability for the claim, any offers made to the respondents and the State's view as to apportionment of liability with BIC/BISA. The latter issue was first dealt with by the State's written closing submissions that the apportionment should be that BI bear 75% of the liability and the State bear 25%.
2. The State seeks its costs of the third-party claim from BI on a standard basis. BI submitted that it is unclear what costs additional to defending Mr Miller's claim the State would have incurred in relation to the third party claim. BI also submitted that the apportionment of liability on the third party claim that it suggested is much closer to the result than the apportionment suggested by the State. BI referred to Knight v Clifton,[30] where Sachs LJ stated that where a successful party causes an action to continue by its conduct, that may justify an order depriving it of an order for costs in whole or part.

1. In reply the State submitted that throughout the litigation, BI denied that the State was entitled to contribution and made no offer to settle while the State recovered contribution from BI.
2. The State submitted that BI relies upon filed offers made by Mr Miller that Mr Miller does not rely upon because they sought more than was awarded. Further, Mr Miller's Calderbank offer was made to both respondents and could not have reasonably been accepted by the State alone.
3. The State submitted that if BI wished to protect itself in relation to costs, it should have made a liability offer in the third party claim. In relation to the complaint that BI was not apprised of the 2 April 2025 letter from Amaca, the State submitted it was simply observing the confidentiality requirement attached to Amaca's offer.

1. The concept of relevant delinquency is described in the joint judgment of Gaudron and Gummow JJ in in Oshlack v Richmond River Council.[31] Their Honours joined with Kirby J in allowing an appeal in relation to costs. The primary judge had found against an applicant who championed environmental causes and sought to restrain the respondent council from approving a development. Although the council succeeded at first instance, the primary judge made no order as to costs. On appeal to the NSW Court of Appeal, the applicant and appellant was ordered to pay the council's costs of the hearing below and the costs of the appeal. On further appeal to the High Court, the first instance costs decision was restored and the council was ordered to pay the costs of both appeals. Brennan CJ and McHugh J were in dissent. While Brennan CJ made the observation that "[c]osts are awarded to indemnify a successful party in litigation, not by way of punishment of an unsuccessful party",[32] the plurality stated:[33]

It may be true in a general sense that costs orders are not made to punish an unsuccessful party. However, in the particular circumstance of a case involving some relevant delinquency on the part of the unsuccessful party, an order is made not for party and party costs but for costs on a "solicitor and client" basis or on an indemnity basis. The result is more fully or adequately to compensate the successful party to the disadvantage of what otherwise would have been the position of the unsuccessful party in the absence of such delinquency on its part. [Footnotes omitted]

1. The headings that follow concern the various issues identified by the State and Mr Miller in relation to the issue of relevant delinquency.

1. The State submitted that the relevant delinquency submission should be rejected because the proceeding was complex and gave rise to some novel issues, the primary one being that Mr Miller's claim was based on occupier's liability rather than employer's liability or product liability. the State submitted that:[34]

The scope of an occupier's liability and whether the provision of training to employees of a contractor not employed by the occupier falls within the ambit of the requisite duty is similarly a legally complex question requiring judicial determination.

1. The State's Second Defence was filed and served on 24 February 2025. The State denied that the RAH was "industrial premises" within the meaning of the Industrial Safety, Health and Welfare Act 1972. The pleading is correct because that Act had been repealed and replaced by the Occupational Health, Safety and Welfare Act 1986 by the time Mr Miller commenced work at the RAH. The State denied the particulars of negligence and particulars of breach of statutory duty alleged. The State did however admit that it carried on an industrial and commercial process within the meaning of s 8(2) of the DD Act at the RAH.
2. In its Second Defence the State pleaded that it took reasonable steps to remove and identify asbestos and notify workers of the presence of asbestos in areas where work was carried out. The State also asserted that it provided training to workers "in relation to the risks arising from exposure to asbestos before commencing to undertake work at the hospital",[35] and that workers were required to wear protective equipment. I found that the things pleaded were not done in relation to Mr Miller during the six months or so that he worked at the RAH.
3. The State submitted that Mr Miller did not pursue his case on the basis that the failure to induct, train or educate contractors "alone meant that it had breached its duty of care".[36] That is not correct. The Second Statement of Claim pleads as a particular of negligence a failure "to warn the applicant of the dangers to which he was exposed".[37]
4. The State's submission about the novelty of the proceeding is not accepted as the Second Defence did not raise the issue of the nature and extent of any duty of care owed to Mr Miller, nor did it make reference to the legal consequences of the State being an occupier of premises as opposed to an employer or a manufacturer of asbestos products.

1. The State's attack on the credibility of Mr Miller was another plank of the State's defence to the charge of relevant delinquency. The issue of credibility was addressed in this way in the primary decision:[38]

The State took issue with how often Mr Miller said that he encountered asbestos at the RAH. The State submitted Mr Miller's original statement in his first affidavit that he came across asbestos 'almost invariably', or multiple times each week, was out of step with the evidence of all other witnesses. At the outset of his oral evidence, Mr Miller modified his affidavit to say that rather than coming across asbestos 'almost invariably' or 'most of the time', he came across it "from time to time". The State submitted that in doing so, Mr Miller "effectively conceded that what he had said in his [first] affidavit was not true". The State challenged Mr Miller's reliability and credibility.

The State submitted that I need to feel an actual persuasion that Mr Miller was exposed to asbestos at the RAH. The State submitted that there was a divergence between his account and the account of the other non-expert witnesses. For the following reasons I find there are strong similarities between the evidence of the Manpower electricians and Mr Miller, and I accept those accounts, and I feel an actual persuasion that Mr Miller was exposed to asbestos, including crocidolite, at the RAH. (Footnotes omitted)

1. While the State's submissions about Mr Miller's credibility were not accepted, there was a disparity between his affidavit evidence and the evidence of the Manpower electricians in relation to the extent of their exposure to asbestos at the RAH. At the outset of his oral evidence, Mr Miller indicated that the extent of his exposure was less than stated in his evidence affidavit. While Mr Miller's original description of his exposure to asbestos at the RAH was overstated, it was found that was because almost 35 years had passed between when Mr Miller worked at the RAH for a very short time and when he prepared his affidavit. The Manpower electricians and the witnesses called by the State who worked at the RAH all worked at the RAH for much longer than Mr Miller.
2. There was a proper basis for the State to take issue with Mr Miller's credibility and to challenge his evidence about his exposure to asbestos, at least until a witness for the State, David McGowan, gave oral evidence.

1. Mr Miller submitted that there was relevant delinquency in the way that the State conducted its discovery. Mr Miller pointed to an order that required the State to provide "granular detail about the extent of the resources that have been applied to the task of making discovery" supported his submission.[39]
2. The State provided this timeline in relation to discovery:[40]
   1. On 2 August 2024, the Court ordered that parties be required to file and serve a list of documents within 1 week following the judicial settlement conference. The conference was listed for 24 October 2024. However, the conference did not eventuate as scheduled and the matter therefore proceeded to a hearing on 30 October 2024.
   2. On 30 October 2024, the Court ordered that the first respondent make discovery by 4 December 2024.
   3. On 4 December 2024, the first respondent filed a List of Documents. At the time of service, the first respondent sent the parties a letter stating:

My client has done its best to comply with the order for Discovery in good faith. However, my client is continuing to search for relevant documents and acknowledges that there are likely other relevant documents which will be located. If and when further discoverable documents are located they will be discovered in accordance with the ongoing obligation to do so.

1. On 4 February 2025, the Court ordered that '[a]ny party that seeks to be heard on any issue, including the ambit of discovery... or dealing with the issue of exemplary damages... is to file and serve an application for directions and supporting affidavit by 4pm on 13 February 2025 setting out what is sought.'
2. On 13 February 2024, an affidavit of Ms Mary Therese Karpinski was filed by the first respondent (Ms Karpinski's affidavit) which contained a detailed explanation of the process of discovery that had been undertaken, with reference to contact with twenty-one (21) State government agencies and the enormity of the task at hand. Ms Karpinski deposed to the discovery process commencing on 20 August 2024.
3. On 19 February 2025, the first respondent filed List of Documents - Revision 1, in accordance with its ongoing discovery obligation. Contrary to Ms Hoffman's affidavit, Mr Frajer's 2010 memorandum was discovered in this list (no. 191).
4. On 20 February 2025, argument occurred before the Court. During that hearing, the first respondent did not seek an extension of time to make discovery, instead noting that it had continuing discovery obligations per rule 73.10 of the Uniform Civil Rules 2020 (SA) (UCRs). In the course of that hearing, the applicant agreed that the ongoing obligation to discover continued, and that should the ongoing discovery cause a problem during the course of the trial, either the first respondent or the applicant could make an application for an adjournment of the trial.
5. On 6 March 2025, the first respondent filed List of Documents - Revision 2, in accordance with its continuing discovery obligation.
6. On 11 April 2025, the first respondent filed List of Documents - Revision 3, in accordance with its continuing discovery obligation. Contrary to Ms Hoffman's affidavit, the 2007 audit report was discovered in this list (no. 339).
7. On 11 April 2025, during a directions hearing, the applicant's counsel raised the issue of the State's ongoing discovery. The applicant's counsel queried when the discovery process would come to an end. The first respondent reiterated that it had ongoing discovery obligations. However, the Court was minded to impose an end date for discovery.
8. On 15 April 2025, the Court ordered the 'completion of discovery' of relevant documents in relation to the RAH by 16 May 2025 and other relevant documents by 28 May 2025.
9. On 16 April 2025, the first respondent emailed the Court and sought clarification in relation to the phrase 'completion of discovery'. Further email communications in relation to this occurred on 28 and 29 April 2025.
10. On 30 April 2025, the first respondent filed an affidavit of Ben Lu, which addressed the abovementioned history of the first respondent's discovery. The first respondent sought clarification as to whether the Court's order for the first respondent to 'complete discovery' was intended to relieve the first respondent of its continuing obligation to make discovery.
11. On 7 May 2025, the Court ordered that the first respondent be relieved of its obligation to make further discovery after 20 May 2025.
12. On 20 May 2025, the first respondent filed List of Documents - Revision 4. (Footnotes omitted)

1. The State submitted that it had been transparent in relation to its discovery and that when Mr Miller raised the issue in early February 2025, the State correctly contended that it was "under an obligation to continue making discovery [and Mr Miller] was content to proceed with the trial dates while discovery continued".[41] "When the issue was formally raised again in April 2025, orders were ultimately made relieving the first respondent of its obligation to make further discovery",[42] and it was "inappropriate to revisit this issue now".[43]
2. The State did take a long time to make discovery and did not fully describe the resources that were allocated to the task. I anticipate that the State's response to those comments would be that thousands of documents were discovered, and many more considered, and the process took significant time. The State did not indicate whether it had made discovery in other dust disease actions based on working at the RAH, and if so, what the extent of the discovery in such actions was.
3. The 'granular detail' order did not need to be complied with because the issues with discovery were resolved between Mr Miller and the State soon after the order was made. Given that, and given the explanation provided by the State, it is not appropriate to order indemnity costs against the State based upon how the State made discovery.

The positive assertions made by the State and Mr McGowan's evidence

1. The State alleged that employees of labour hire firms who performed work at the RAH (external contractors), were inducted, trained and warned about the presence and danger of asbestos at the RAH. Mr Miller and the Manpower electricians gave evidence that they received no induction, training or warning in relation to asbestos when they commenced working at the RAH as employees of Manpower. That evidence was accepted and supported by the evidence of David McGowan, the person responsible for managing asbestos safety at the RAH at the relevant time.
2. Mr McGowan stated very clearly in oral evidence that he did not induct, train or warn external contractors about asbestos because he considered that it was the responsibility of their employer to do that. [44] However, Mr McGowan's witness statement made no mention of that very important fact. Mr Miller submitted that "the evidence of the principal safety officer at the RAH... corroborated the central tenets of [his] allegations".[45] Mr Miller submitted that either the State knew that Mr McGowan would give that evidence and that it would support the evidence of Mr Miller and the Manpower electricians, or the State failed to ask Mr McGowan a critically important question. Mr Miller submitted that if the State "had conducted its defence in a reasonable and diligent manner", it would have been aware, that according to Mr McGowan:[46]

(a) the State controlled and supervised the work and was responsible for the safety of all workers (including contractors) from the potentially lethal effects of asbestos;

(b) he was the principal officer in charge of asbestos procedures including provision of information;

(c) from the mid-1980s it was known that tradesmen working at the hospital might be exposed to asbestos dust in circumstances where they did not expect it to be present and that such exposure might only become apparent during the course of the work after exposure had occurred;

(d) from the mid-1980s he, as the principle asbestos safety officer, knew that asbestos fibres were carcinogenic, and that workmen exposed to even one fibre might contract mesothelioma and die;

(e) the State did not provide any training or "any information" regarding asbestos to employees of contractors including Manpower because he considered that was not the responsibility of E&BS.[47]

1. In his witness statement, Mr McGowan stated that he organised "asbestos-specific training at the hospital".[48] The training included practical things such as how to fit a mask. In the next paragraph Mr McGowan stated that contractors who worked at the RAH "were required to have an asbestos certificate from the Department of Labour and Industry" which "certified that the contractor had completed asbestos training"[49] Mr McGowan said that he sighted and checked such certificates. Mr Miller and the Manpower electricians denied having or being required to have an asbestos certificate before commencing at the RAH. Two of them, Mr Bastian and Mr Villiers, recalled attending an information session about asbestos conducted by Jack Watkins, a trade unionist who was actively involved with asbestos safety at the RAH. Mr Bastian and Mr Villiers did not recall receiving training given by Mr McGowan or a RAH employee. In oral evidence Mr McGowan qualified his witness statement and stated that the requirement to provide a certificate of asbestos training and to undergo annual asbestos training applied to RAH employees but not to external contractors.[50]
2. The following passage in the primary decision pertains to the five 'relevant delinquency conclusions' advanced by Mr Miller:[51]

Mr McGowan said that a project to remove asbestos from the RAH was designed in 1985 and commenced operation in 1986 or 1987. Some smaller asbestos removal had occurred before then. Mr McGowan said that the removal of asbestos on a larger scale was underway by 1989.

Mr McGowan said that the ceiling spaces in the RAH were grossly contaminated by sprayed asbestos but there was no sprayed asbestos in the riser ducts. He said that performing work "in the riser ducts was a matter for fire prevention, rather than asbestos work". The comment suggests he did not understand the nature and extent of electrical work done in risers by the Manpower electricians. Later in his evidence Mr McGowan agreed that there could be asbestos in a riser if there had been "a dislodgement of a piece of sprayed asbestos that dropped...in the ceiling space and in the ordinary air flow". He said that it was possible for asbestos fibres to be disturbed and move prior to the time when fire barriers were installed in ceiling spaces. That supports Mr Villiers' evidence in that regard.

The process of erecting fire barriers in ceiling spaces was in its infancy and far from complete when Mr Miller worked at the RAH. Mr McGowan's evidence supports the evidence of Mr Miller and the Manpower electricians that asbestos was present in RAH ceiling spaces and risers, and in abundance in the case of the former.

Mr McGowan agreed that the management of asbestos at the RAH was delegated to him. He said the certificate given by the DLI[52] to certify the completion of asbestos training was required by all employees who worked in the maintenance division. Mr Miller and the Manpower electricians worked in the project division.

(Footnotes omitted)

1. Mr McGowan reported to David Reynolds, who the State relied on to assert there were inductions, training and warnings in relation to asbestos at the RAH. The following findings were made in relation to Mr Reynolds' evidence and asbestos safety training at the RAH generally: [53]

Mr Reynolds stated that inductions "included all contract workers as well". I take that comment to refer to internal contractors.[54] The same construction applies to Mr Reynolds' assertion that all workers were required to wear protective clothing and respirators. If Mr Reynolds meant employees and contractors working for E&BS, as his statement suggests, I accept that evidence. If he meant to include Manpower employees in the comment, I reject that evidence.

To the extent that Mr Reynolds' evidence conflicts with that of Mr Miller or the Manpower electricians about their training, safety awareness and the provision of PPE, I prefer their evidence to that of Mr Reynolds. Their evidence that they were given no training is consistent with the evidence of Mr McGowan. Mr McGowan did not consider it was his responsibility or role to educate external contractors about asbestos.

The Manpower electricians all said that they encountered asbestos in the early part of their time at the RAH. That is not surprising. As Mr Villiers said, the RAH was literally full of asbestos in the early 1990s. The State submitted that "sprayed asbestos covered thousands of metres of structural steelwork". Precautions such as wearing PPE and using the bubble may have applied to RAH/E&BS employees and internal contractors working in asbestos zones, but did not apply to Mr Miller during his time at the RAH.

(Footnotes omitted)

1. Some other witnesses called by the State asserted that inductions, training and warnings about asbestos safety were provided to external contractors. Some of that evidence was without a proper foundation. An example is Joe Busuttil, whose evidence is described in this way in the primary decision:[55]

Mr Busuttil stated that all tradesmen at the RAH had to assume that the risers, ceiling spaces and catacombs were contaminated with asbestos and if they were not taking precautions to protect themselves, they were not doing the right thing. He assumed that his level of knowledge of asbestos was shared by all who worked at the RAH and was plainly wrong about that. His evidence went well beyond his limited experience at the RAH. It is unfortunate that the ALU[56] or AMU[57] did not suggest to RAH management that all tradespersons and labourers should wear masks in risers, ceiling spaces and the catacombs.

I accept the submission of counsel for Mr Miller that Mr Busuttil's evidence about the knowledge of the ALU and the DLI supports Mr Miller's case because Mr Busuttil agreed that by the late 1980s:

(b) the State knew that asbestos fibres were carcinogenic, and that there was no safe level of exposure to asbestos dust;

(c) the State knew that asbestos dust could be friable and resuspended in the air if tradesmen disturbed it;

(d) the State considered that workers at the RAH should be provided with an induction, training and information regarding asbestos and the need to protect themselves from it;

(e) the State knew that because of the risk that any service riser, ceiling space and catacomb at the RAH might be contaminated with asbestos, all of these areas were deemed by the ALU to be contaminated with asbestos; and

(f) the State knew that any tradesman entering a service riser, ceiling space or catacomb at the RAH should wear respiratory protection at all times because of the risk of exposure to asbestos.

1. Mr Busuttil was not employed by the RAH. The RAH was one of many sites e visited. Mr Busuttil's work at the RAH was in connection with asbestos removal, not working in the presence of asbestos as Mr Miller and the Manpower electricians did. Mr Busuttil's assertion that external contractors were inducted and given asbestos awareness training was based on surmise and was wrong.[58]
2. The State submitted that the evidence of Ted Carlaw supported its case that inductions and asbestos awareness training were provided to external contractors. The following passage explains why Mr Carlaw's evidence to that effect was not accepted:[59]

Mr Carlaw claimed that if Mr Miller had been supervised by Luke Barnard, he would not have been allowed to knowingly undertake work with asbestos without PPE and adhering to procedures. Like the evidence of the other former RAH managers, Mr Carlaw's evidence was given through the prism of someone familiar with the treatment and management of RAH employees and internal contractors. His account is neither relevant nor accurate in relation to the Manpower electricians and Mr Miller.

Mr Carlaw's evidence that inductions took place from the mid to late 1980s is qualified by Mr Maybank's evidence that he, and by logical extension the RAH, did not arrange for external contractors who worked at the RAH to be inducted. The induction Mr Carlaw described only took 20 minutes and involved completing a one page document by ticking boxes.

Mr Carlaw said there was asbestos in the East Wing and North Wing, specifically in outpatients, the theatre block and the risers. The policies and procedures he described for working safely with asbestos did not apply to external contractors like Mr Miller, Mr Drury, Mr Bastian and Mr Villiers.

Mr Carlaw said that the asbestos register 'supposedly' described all areas where asbestos was present. He used his fingers to place air quotation marks around the word 'supposedly'. It was apparent that he did not think the register was reliable. Mr Carlaw said that each tradesman could choose whether to wear a mask when working outside of an asbestos zone. [Footnotes omitted]

Despite the evidence of some of the witnesses called by the State, it was found that inductions and asbestos awareness training were not provided to external contractors when Mr Miller worked at the RAH as Mr Miller, his liability witnesses and Mr McGowan all testified.

1. Mr Miller's Calderbank offers to the State and Amaca were made on 2 April 2025. By then, four of the thirteen days that the hearing eventually occupied had been completed, the latest being 14 March 2025. After that the hearing did not resume until 26 May 2025. During the first four hearing days, Mr Miller's evidence was completed and the evidence of Mr Drury, a Manpower electrician, was commenced but not completed.
2. Mr Miller advised the State and Amaca that he would accept $2,000,000 plus costs. The offer was reasonable given that Mr Miller succeeded against each respondent and was awarded 10% more than that amount. Amaca took the view that Mr Miller would probably succeed on liability and that his offer on quantum was reasonable and advised the State accordingly in its Calderbank offer to the State made on 2 April 2025.
3. The State submitted that the 80/20 apportionment ordered justified the rejection of the 95/5 apportionment proposed by Amaca. That is correct in my view, but the State and Amaca could have approached Mr Miller jointly or separately and offered to agree quantum at $2,000,000. If that offer had been accepted, the remaining hearing days could have been devoted to liability evidence and there would have bee a substantial saving of time and cost.
4. While the economic loss experts called by Mr Miller and Amaca disagreed about how best to calculate future economic loss, they proposed similar figures when applying the more conservative calculation method that was adopted. There was still a substantial award because Mr Miller's business is very profitable. In relation to general damages, while the amount awarded is high by reference to decided South Australian cases, even if the award is halved, and the other heads of damage remain the same, the $2,000,000 Calderbank offers made by Mr Miller would be exceeded.
5. The strongest basis of the relevant delinquency submission is the failure of the State to make out key assertions in its Second Defence, including that:[60]

9.1 It took reasonable steps to eliminate, mitigate and/or otherwise protect workers, including the Applicant, undertaking works in the hospital against the risk of exposure to asbestos, by:

9.1.1Commencing a process in the 1980s to remove asbestos from asbestos contaminated areas, which continued in the 1990s and thereafter.

9.1.2Identifying asbestos contaminated areas within the hospital and maintaining a record of its location, fibre type and condition.

9.1.3 Adopting the procedures set down by Code of Practice identified in South Australian Health Commission Technical Bulletin 24 ("the Code").

9.1.4 Adopting the procedures laid down by the Occupational, Health, Safety and Welfare (Asbestos) Regulations 1991 after their commencement on 1 April 1991.

9.1.5 Notifying workers of the presence of asbestos in areas of the hospital where works were to be carried out.

9.1.6 Notifying workers of the existence of the Code and the need to meet its requirements.

9.1.7 Requiring that workers be trained in relation to the risks arising from exposure to asbestos before commencing to undertake work at the hospital.

9.1.8 Requiring workers to wear respiratory protective equipment and protective clothing:

9.1.8.1Whenever works were required to be undertaken in the immediate vicinity of asbestos.

9.1.8.2 During the performance of maintenance and alteration work that could give rise to disturbing asbestos including when removing ceiling tiles and undertaking works in suspended ceiling spaces.

9.1.9 Requiring workers to wear protective equipment until the works which disturbed or was likely to disturb asbestos was finished and the area had been cleaned by vacuum cleaning and all asbestos waste removed.

9.1.10Requiring workers and equipment leaving work areas to first be decontaminated by either vacuum cleaning or washing.

1. Mr McGowan's oral evidence about inductions, training and warnings in relation to asbestos was contrary to the assertions in paras 9.1.5 to 9.1.8 in relation to Mr Miller and external contractors. Contrary to the assertion in para 9.1.7 of the State's Second Defence, the RAH provided no induction or training in relation to asbestos safety to Mr Miller. Contrary to the assertion in para 9.1.8, most of the State's witnesses and all of Mr Miller's liability witnesses gave evidence that masks and PPE were only required to be worn in designated asbestos zones, despite RAH management knowing by 1990 that asbestos was toxic and potentially lethal. Mr Miller and the Manpower electricians encountered asbestos outside of designated asbestos zones. That was because, based on the evidence of many of the State's liability witnesses, the RAH asbestos register was notoriously unreliable and inaccurate.
2. Mr Miller's first submission was that the State pay his costs on an indemnity basis from the commencement of the proceeding. That submission must be rejected. His alternative submission was that the State pay his costs on an indemnity basis from the date of his Calderbank offer.
3. In Nominal Defendant v Dighton (No 2),[61] the Full Court of the Supreme Court described some relevant considerations when assessing the effect of a Calderbank offer:[62]

Mr Roberts relied on the decision of Hazeldene's Chicken Farm v VWA (No 2) (2005) 13 VR 435. Whilst it is not a binding decision on this Court, it is a helpful summary outlining what considerations a court should consider when making a determination on costs following the making of Calderbank offers. The court in Hazeldene said that the following matters that should be borne in mind. First, what stage the proceedings were at when the offer was received. Secondly, the time allowed to consider the offer. Thirdly, the extent of the compromise offer. Fourthly, the prospects of success from the date of the offer. Fifthly, the clarity in which the terms were expressed and finally, whether the offer foreshadowed indemnity costs in the event the offeree rejected it. We agree that there (sic) are the appropriate criteria to consider.

1. In my view it was not unreasonable for the State and Amaca to use the May and June 2025 hearing dates to resolve the issue of liability as between them. Mr Miller's Calderbank offer was not made until 2 April 2025 and failing agreement about liability between the respondents, acceptance of the offer required one of them to assume liability for the claim and seek recovery from the other. That may have required another proceeding to be instituted and to proceed without Mr Miller being directly involved. Mr Miller made the decision to proceed against two respondents rather than just one of them.
2. I am not satisfied that there was relevant delinquency on the part of the State as at 2 April 2025. While Mr McGowan's witness statement did not set out his evidence in full and was plainly deficient in that regard, Mr McGowan is not a young man. He retired from employment many years ago. It is possible that his memory was not complete when he gave evidence and was jogged by cross-examination. Not surprisingly, many of the liability witnesses had difficulty in working out when events occurred.
3. While it is not appropriate to find relevant delinquency at the time when Mr Miller's Calderbank offer was made, it is appropriate to do so after Mr McGowan gave oral evidence for the following reasons.
4. Section 7(1a) of the DD Act provides that the "[c]osts of proceedings in dust disease actions before SAET will be allowed or awarded on the same basis as for actions in the District Court". The UCR apply to the costs of proceedings in the District Court.
5. Rule 194.5 of the UCR contains a series of general principles relevant to awarding of costs. Rules 194.5(1) and (2) provide:

(1) Each of the following principles are subject to -

(a) the presumptive costs rules in rule 194.4 (to the extent that the Court does not otherwise order);

(b) other applicable rules;

(c) other applicable principles; and

(d) the overriding discretion of the Court as to costs.

1. Rule 194.6 describes some discretionary factors that may be considered when awarding costs:

(1) In exercising its discretion as to costs, the Court may have regard to any factors it considers relevant.

(2) For example, the Court may have regard to the following factors -

(a) any misconduct or unreasonable conduct of a party in connection with a proceeding;

(b) any breach by a party of overarching obligations, these Rules or an order of the Court;

(c) any breach by a party of the pre-action obligations imposed by Chapter 7 Part 1;

(d) the making or not making of an offer by a party to resolve the proceeding;

(e) the non-acceptance by a party of an offer made by another party to resolve the proceeding;

(f) the value and importance of the relief sought or any relief obtained;

(g) any public interest in the subject matter of the proceeding or public benefit from the prosecution or defence of the proceeding; or

(h) whether costs awarded are to be met by a person or out of a fund.

**Note - **

See also rule 61.16 in relation to pre-action steps and rule 132.11 and rule 132.12 in relation to formal offers.

1. In Holt v Bunney (No 2), the Full Court of the Supreme Court observed that the costs provisions of the UCR did not alter the "fundamental position" that existed under the previous rules of court.[63]
2. In Australian Transport Insurance Pty Ltd v Graeme Phillips Road Transport Insurance Pty Ltd,[64] Woodward J stated that the discretion to award costs is "absolute and unfettered" but must be exercised judicially.[65]
3. Mr McGowan gave evidence on 26 June 2025. The hearing then adjourned to 21 July 2025 and concluded on 23 and 24 July 2025 when closing addresses were made. The hearing was also listed to proceed on 22 July 2025 also but the parties sought and were granted time to use that day to complete their written submissions.
4. Mr McGowan's oral evidence had a very significant effect on the case. The positive assertions made by the State in its Second Defence about inductions, training and warnings about asbestos were undermined by Mr McGowan, the witness best placed to comment on those issues.
5. In my view, a reasonably prudent litigant in the position of the State should have taken steps to resolve this proceeding after 26 June 2025. By then the State knew or should have known that the positive assertions it had made about inductions, training and warnings about asbestos in the Second Defence could not be sustained. Based on the case pleased by Mr Miller, and the defence raised by the State, the State was extremely unlikely to make good its positive assertions and defend the claim. Mr McGowan's evidence supported the evidence of Mr Miller and the Manpower electricians on critically important issues. In addition, prior to 26 June 2025, Professor Sonia Klebe had given oral evidence that an exposure to crocidolite for one hour is sufficient to cause mesothelioma.[66] No real challenge was made to the evidence of Professor Klebe by any party. The challenge to Mr Miller's credibility by the State was strongly eroded by the evidence of Mr McGowan. Even based on Mr Miller's modified evidence about the extent of his exposure to asbestos at the RAH, it was likely that it would be found that he was exposed to crocidolite for more than one hour given the amount of time he spent working in ceiling spaces and risers where crocidolite could be present.
6. The liability witnesses called by the State after 26 June 2025 were David Hawkins,[67] Richard Crichton,[68] and Robert Archer.[69] All three gave evidence on 21 July 2025. Their evidence did not touch on inductions, training and warnings to external contractors in relation to asbestos. Mr Hawkins was involved with asbestos surveys and making suggestions about asbestos removal. He had no interaction with external contractors like Mr Miller. Mr Crichton was not employed by the RAH. He commenced employment with Environmental and Industrial Laboratories in 1989. He worked at many sites including the RAH and conducted air monitoring while asbestos removal took place. He did not recall ever meeting Mr McGowan and did not know Mr Miller or what work Mr Miller did at the RAH. Mr Archer was employed by and worked as an electrician at the RAH in the maintenance team. Mr Miller and the Manpower electricians all worked in the project team. Mr Archer acknowledged that there was a demarcation between the two teams. The demarcation extended to the nature of the work performed by each team and the protective measures each team was required to take by the RAH when working with asbestos. Mr Archer did not know Mr Miller but knew Mr Drury and described him as careful and trustworthy.[70]
7. Rule 194.6(d) of the UCR provides that the discretion to award costs may be exercised having regard to "the making or not making of an offer by a party to resolve the proceeding". The effect of Mr McGowan's evidence and the State's knowledge that Mr Miller was prepared to resolve his claim for $2,000,000 plus costs shou in early April 2025 should have led the State to make an offer to Mr Miller after 26 June 2025. Mr McGowan's evidence provided a strong basis for a finding negligence against the State. The asbestos Mr Miller was exposed to at the RAH was much more lethal than the asbestos he was exposed to in Amaca products so it was reasonable to assume that the State would be found liable to a greater extent than Amaca.
8. After 26 June 2025, the reasons that justified the State from not accepting or making some positive response to Mr Miller's Calderbank offer of 2 April 2025 no longer applied. The State's defence about inductions, training and warnings would not succeed. It was likely that Mr Miller would be accepted about being exposed to crocidolite at the RAH and that the provisions of the DD Act would apply to his claim. The concerns that the State had held in relation to Mr Miller's credibility or reliability were overtaken by the effect of Mr McGowan's evidence. The Manpower electricians had already substantially supported Mr Miller's evidence about the absence of inductions, training and warnings about asbestos and the prevalence of asbestos in the RAH.
9. While Mr Miller's Calderbank offer had been rejected and was no longer open, the State could have put an offer to Mr Miller to resolve his claim. It was apparent that he wished to resolve the matter without it proceeding to judgment, perhaps because of the very significant costs that were being incurred. In all the circumstances, after 26 June 2025 there was relevant delinquency on the part of the State.
10. To use the rationale of the plurality in Oshlack, it is appropriate to more fully or adequately compensate Mr Miller to the disadvantage of the State given the costs he has had to incur since 26 June 2025.
11. From 10 July 2025, the State should pay the difference between Mr Miller's costs on a party and party basis and his costs on an indemnity basis. The State should also pay Mr Miller's costs of and incidental to the costs argument on an indemnity basis.
12. As Mr Miller succeeded against each respondent, and the State bettered Amaca's offer in relation to liability, each respondent is to be equally liable for Mr Miller's party and party costs until 10 July 2025.
13. For the reasons given, the State is liable for the difference between Mr Miller's costs on a party and party basis and his costs on an indemnity basis from 10 July 2025.

1. The basis on which Mr Miller seeks indemnity costs from Amaca is Amaca's failure to accept Mr Miller's Calderbank offer. Doing so would have required Amaca to meet Mr Miller's claim in full and pursue the State for contribution in separate proceedings. For the reasons given, it was not unreasonable for either respondent to not proceed in that way at the time when Mr Miller made his Calderbank offers to them.
2. Amaca did not call any liability evidence. The quantum evidence it called was relied upon by the State and BI. Amaca advised the State that it considered that the quantum of Mr Miller's Calderbank offer was reasonable on the same day that Mr Miller made the offer.
3. In my view, Amaca conducted itself reasonably throughout the proceeding and there was no relevant delinquency on its part.

1. BI submitted that offers like the Calderbank offers made in this case, even when expressed to be final and non-negotiable, may be a catalyst for making further offers and ultimately resolving the matter. The submission accords with my experience in this and other civil jurisdictions. The submission was put in the context of an overarching submission that the State was unreasonable not to make any offer to resolve Mr Miller's claim or the third party claim against BI. The difficulty with the overarching submission is that while the State did not make any offer of settlement to BI, BI did not make any settlement offer to the State.
2. BI could have filed an offer in relation to liability or made a Calderbank offer in relation to liability but did not. After Amaca discontinued its third party action against BI, BI's only potential liability was to the State. BI submitted it was clear the State would be found liable to a greater extent than Amaca. That view suggested the amount of contribution that BI was ordered to make to the State might be substantial.
3. The State is to have its costs of the third party claim paid by BI on a party and party basis.
4. The State's submission that BI should be ordered to contribute to the State's liability to meet Mr Miller's costs is rejected. BI assumed a relatively low profile in the hearing and did not call any witness. Counsel for BI cross-examined the witnesses called by other parties but did not materially increase the time taken to conclude the hearing. That combined with the State's failure to communicate with BI about liability, quantum, contribution and settlement weighs against making the order sought.

1. Mr Miller's party and party costs of the proceeding are to be paid by the State and Amaca in equal proportions, excluding costs of the costs argument. From 10 July 2025, Mr Miller is to be paid the difference between his party and party costs and his costs on an indemnity basis by the State. The State is to pay Mr Miller's costs of the costs argument on an indemnity basis. The State is to have its costs of the third party claim paid by BI on a party and party basis. Amaca and BI are to bear their own costs of the costs argument.
2. The parties are to file agreed draft orders reflecting these reasons within 14 days failing which each party is to file its own proposed draft orders within the same period.

[1] [1975] 3 All ER 333.

[2] Applicant's Submissions on Costs [41].

[3] Oshlack v Richmond River Council [1998] HCA 11 [44]; [1998] HCA 11; (1998) 193 CLR 72.

[4] Applicant's Submissions on Costs [11].

[6] [2020] SASCFC 120.

[9] [1993] FCA 536; (1993) 46 FCR 225.

[13] [2012] SASCFC 97 [8].

[14] [2021] SASC 103.

[16] [2021] SASC 69.

[18] Written submissions of the first respondent on costs [11.a.].

[20] Closing submissions of the first respondent dated 23 July 2025 [59]-[66], [295]-[296].

[21] Written submissions of the first respondent on costs [21].

[23] Gerson v Simpson Reitlinger and Others, Third Parties (1903) 2 KB 197 at 203 per Collins MR; Simpson v British Industries Trust Ltd (1923) 39 TLR 286; Jerred and Others v T Roddam Dent & Son Ltd; (Glen Line Ltd Third Party) [1948] 2 All ER 104 at 110 per Atkinson J; Sinclair v William Arnott Pty Ltd (No. 2) (1963) 64 SR (NSW) 88 at 96 per Walsh J.

[24] Further Written submissions of the First respondent on costs [5].

[25] Written submissions of the third parties [1].

[30] [1971] Ch. 700 [718].

[31] [1998] HCA 11 [44]; [1998] HCA 11; (1998) 193 CLR 72.

[32] Ibid [1] per Brennan CJ referring to Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534 at 542.

[34] Written submissions of the first respondent on costs [14].

[35] Second Defence of the first respondent [9.1.7].

[36] Written submissions of the first respondent on costs [14].

[40] Written submissions of the first respondent on costs [21].

[44] Tr 1351, 25-37; Tr 1352, 27-36; Primary decision [655]-[656].

[45] Applicant's Submissions on Costs [32].

[46] Applicant's Submissions on Costs [31].

[47] The RAH Engineering and Building Services Department.

[48] Witness statement dated 6 March 2025 [29].

[52] The South Australian Department of Labour and Industry.

[54] In the primary decision, internal contractors is the label used to describe contractors who were engaged by the RAH and were not employed by a third party. Unlike external contractors, internal contractors were under the direct control and supervision of RAH management.

[57] The RAH Asbestos Management Unit which was replaced by the ALU in or about 1985.

[60] Second Defence of the first respondent.

[61] [2012] SASCFC 97.

[63] [2020] SASCFC 120 [9].

[64] (1986) 71 ALR 281.

[67] Evidence summarised at [538]-[573] primary decision.

[68] Evidence summarised at [574]-[593] primary decision.

[69] Evidence summarised at [594]-[628] primary decision.