Plaintiff v Defendant

1 In these two proceedings, the plaintiff parties (the 'Claimants')[1] were successful in their claim for increased compensation in relation to the compulsory acquisition of two land holdings located in Dingley by the defendant, Head, Transport for Victoria (the 'Authority') on 29 March 2019 under the Land Acquisition and Compensation Act 1986 (Vic) (the 'LAC Act').

2 The lands in question (the 'Acquired Land'),[2] the relevant legislation and planning scheme have a complicated history which is set out in detail in Kingston v HTV and Jomaring v HTV [2023] VSC 618 (the 'Compensation Decision').

3 The Compensation Decision was delivered on 23 October 2023. At that time, I made orders for the parties to provide proposed final orders and directed the parties to file and serve written submissions and any other material they wish to rely upon in respect of costs.

4 On 2 November 2023, I made orders in each of the proceedings prepared and agreed by the parties. Order 1[3] of each of those orders provided for an award of compensation to the Claimants pursuant to s 89(1) of the LAC Act in the sum of:

(a) for the Kingston Proceeding,[4] $1,112,943, which award was satisfied in part by the advance of compensation paid by the Authority to the Claimant of $610,187 on 9 May 2019; and

(b) for the Jomaring Proceeding,[5] $1,126,635, which award was satisfied in part by the advance of compensation paid by the Authority to the Claimant of $908,432 on 9 May 2019.

5 Order 2 of each of the orders provided for an award of interest calculated pursuant to ss 53 and 56 of the LAC Act.

6 On 5 March 2024, I conducted a hearing where I heard from the parties in respect of costs (the 'Costs Hearing') and reserved my decision.

7 The Claimants seek payment of their costs of the proceeding on a standard basis. The Authority opposes the claim and seeks its costs of the proceeding on a standard basis to the date of the expiry of its Calderbank offer,[6] thereafter it seeks its costs on an indemnity basis.

8 As discussed further at [95]-[101] below, in determining the question of costs in this type of proceeding under the LAC Act, the Court may award such costs as it thinks proper taking into account the matters set out in s 91(1) of the LAC Act as it thinks appropriate. These matters include the amount of compensation awarded by the Court as compared to the amount [7]ffered by the Authority7 and the extent to which unreasonable conduct of the parties has a[8]fected the proceedings.8

9 The background to the compulsory acquisition is set out in detail in the Compensation Decision. By way of summary, I set out a brief chronology below, with reference to additional evidence regarding the litigation history adduced by the parties for the purposes of the costs decision.

10 On 29 March 2019, the Authority's predecessor, the Roads Corporation ('VicRoads'),[9] compulsorily acquired the Acquired Land owned by the Claimants.

11 On 12 April 2019, the Authority made an initial offer of compensation to the Claimants pursuant to s 31 of the LAC Act of $1,518,619, comprising:

(a) $610,187 for the Acquired Kingston Land; and

(b) $908,432 for the Acquired Jomaring Land,

with each offer including $15,000 for professional expenses ('2019 Pre‑litigation Offers').

12 The Claimants did not accept the Authority's 2019 Pre‑litigation Offers and on 13 July 2019, the matters in each of the proceedings became a disputed claim for the purposes of the LAC Act.

13 On 3 December 2020, the Kingston Proceeding and Jomaring Proceeding were commenced simultaneously in this Court, with the Claimants filing notices of referral of a disputed claim in each proceeding.

14 On 14 December 2020, the Court made orders in each of the proceedings, ordering the parties respectively to file particulars of claim and particulars of offer.

15 On 16 February 2021, the Claimants filed particulars of claim in each proceeding ('2021 Particulars of Claim'), collectively claiming $51,765,000 for market value in reliance on the valuation evidence of Mr Nicholas Haines of Matheson Stephen Valuations, together with claims for disturbance, solatium and professional expenses totalling $1,017,234.23.[10] Overall, the Claimants claimed $52,782,234.30 plus interest and costs.

16 On 26 March 2021, the Authority filed its particulars of offer ('2021 Particulars of Offer').[11] In total, it offered the Claimants $1,724,922.31, comprised of:

(a) for Kingston, $595,186 as market value compensation, plus $123,760.64 for professional expenses; and

(b) for Jomaring, $893,466 as market value compensation, plus $112,509.67 for professional expenses.

17 The Authority did not offer amounts for solatium or disturbance.

18 In the period from October 2021 to July 2023, the parties prepared in excess of 5,800 pages of material for the trial, comprising four statements from two lay witnesses and some 41 statements and reports from 15 experts across the fields of valuation, town planning, traffic engineering, contamination, civil engineering and hydrology.[12]

19 The bulk of the expert evidence was concerned with matters relevant to the question of the proper 'C' value for the purposes of s 41(7) of the LAC Act, if that provision was applicable.[13]

20 By June 2023, the Claimants had engaged three counsel, Mr Batt KC, Mr O'Farrell and Mr Fetter.[14]

21 On 14 July 2023, the parties attended a mediation. By that stage, as set out in the Supplementary Joint Statement of Valuation Experts dated 10 July 2023,[15] the Claimants' valuer, Mr Haines, had expressed the opinion that the 'C' value (combined, for both properties) was $39,865,000, on the assumptions most favourable to the Claimants, whereas the Authority's valuer, Mr Willison, had expressed the view that it was $2.3 million on the assumptions most favourable to the Authority.

22 Following the mediation, on 24 July 2023, as recorded in the Joint Memorandum of Counsel of the same date,[16] the parties agreed that the aggregate market value compensation (subject to any application of ss 41(5) and 41(7) of the LAC Act) was $34 million, comprised of:

(a) $11.9 million for Kingston; and

(b) $22.1 million for Jomaring.

23 The parties agreed that the aggregate compensation for pre‑referral professional expenses for the purposes of s 41(1)(f) of the LAC Act was $320,792.43, comprised of:

(a) $167,805.71 for Kingston; and

(b) $152,986.72 for Jomaring.

24 The expenses amounts were the updated amounts claimed by the Claimants (on a GST‑exclusive basis) in the proceedings.[17]

25 From this time, the Claimants were pursuing in the Court a primary claim that they should receive $34 million in market value compensation, plus $320,792.43 expenses compensation and $700,000 by way of solatium, totalling $35,020,792 in quantified sums, plus an unquantified disturbance loss claim.[18]

26 Mr Thomas Callander, solicitor for the Claimants, stated in his fourth affidavit that if judgment had been given for the quantified amount on 28 July 2023, then he caused interest under ss 53 and 56 of the LAC Act (taking into account advances) to be calculated as $14,478,523. Accordingly, he says, as at 28 July 2023, the Claimants' primary claim was for at least $49,499,315.[19]

27 Mr Callander's affidavit further states that the Claimants had an alternative position, in case the formula in s 41(7) of the LAC Act was held to apply.[20] Mr Callander states that Mr Haines had expressed in his reports the opinion that the 'B' value was $980,000 for Jomaring and $3,385,000 for Kingston. That meant that, if the formula applied, the market value compensation might only be reduced by 29.6% for Jomaring and by 3.1% for Kingston.

28 Mr Callander states that, accordingly, given the agreed 'C' values, there was the prospect that, if s 41(7) applied but Mr Haines' evidence about the 'B' values was accepted, the Court might award market value compensation of approximately $27,089,500, being:[21]

(a) $15,558,400 for Jomaring ($22,100,000 less 29.6%); and

(b) $11,531,100 for Kingston ($11,900,000 less 3.1%).

29 Accordingly, Mr Callander says that the Claimants' alternative claim was for (rounded) $27,089,500 market value compensation, plus $700,000 solatium, plus $320,792 expenses, totalling $28,110,292 plus an unquantified disturbance loss claim.[22] He says that if judgment had been given for the quantified amount on 28 July 2023, then he had caused interest under ss 53 and 56 of the LAC Act to have been calculated as $11,485,235, taking into account advances. Accordingly, as at 28 July 2023, the alternative claim was for at least $39,595,527.[23]

30 Mr Callander says that following the mediation, he decided to retain three counsel in the case, stating that even though the evidence was materially reduced by the agreement on the 'C' values, he still considered it appropriate to have three counsel, given the size of the claim, the complexity of the legal and valuation issues, and the documentary material that remained relevant.[24] He also noted that he was generally the only solicitor from his firm working on the proceedings, which placed greater demands on counsel.

31 On 28 July 2023, five days before the commencement of trial, the Claimants submitted that they were pursuing a primary claim worth at least $49.499 million in compensation and interest, and an alternative claim worth $39.596 million, and had already incurred approximately $1.708 million in costs in the litigation.[25]

32 On 28 July 2023, the Authority made a Calderbank offer for $6.5 million on an 'all in' basis, that is, including interest and costs and inclusive of amounts previously advanced in the amount of $1,518,619 and with no GST payable ('Authority's Calderbank Offer').[26]

33 The Authority's Calderbank Offer was set to expire at 10:00am on Wednesday 2 August 2023, which was 30 minutes prior to the scheduled beginning of the trial and five calendar days from the time of receipt (comprised of three business days and two weekend days).

34 Late on the previous day, Thursday 27 July 2023, Mr Kingston had instructed Mr Callander to make a Calderbank offer to the Authority in writing on behalf of both Claimants.[27]

35 On 28 July 2023 at 7:36pm, after receiving the Authority's Calderbank Offer, the Claimants sent their own Calderbank offer to the Authority's solicitors ('Claimants' Calderbank Offer').[28] In the Claimants' Calderbank Offer, the Claimants offered to settle the proceedings on the basis that the Authority would pay $30,240,792.43 in respect of market value and pre‑referral professional expenses, plus unspecified amounts in respect of interest and post‑referral professional expenses.[29]

36 On 4 August 2023, the Authority's solicitor responded to the Claimants' solicitor rejecting the offer put by the Claimants in the Claimants' Calderbank Offer.[30]

37 On the same day at 4:36pm, the Claimants' solicitor responded, articulating and restating the offer contained in the Claimants' Calderbank Offer, which was said to be open for acceptance until 4:00pm on 7 August 2023.[31]

38 On 7 August 2023, the Authority rejected the Claimants' offer.[32]

39 The trial of these proceedings were heard together, commencing on Wednesday 2 August 2023 and concluding on Thursday 17 August 2023.

40 In its submissions in respect of costs, the Authority identified certain conduct of the Claimants in the course of the trial to be of relevance to the determination of costs, being the Claimants':

(a) decision not to call Mr Kingston to give evidence in the proceeding;

(b) briefing of their valuation expert Mr Haines; and

(c) case put in relation to hydrology and contamination.

41 Each of these points are described - as a matter of fact - in relation to the Claimants' conduct below. These matters are further analysed by reference to the parties' submissions in [198]-[286] of this decision.

Claimants' decision to not call Mr Kingston to give evidence in the proceeding

42 On the morning of 1 August 2023, being the day before the commencement of the trial, the Claimants' decided to not to call Mr Kingston to give evidence in the proceedings. The Claimants' solicitor states that prior to that time, they had intended to call Mr Kingston.[33] The Authority was notified of this decision at about 9:00am on 1 August 2023, by telephone call between Senior Counsel.[34]

43 Prior to this point, two witness statements by Mr Kingston had been filed in the proceedings.[35] Ms Kathryn Howard, solicitor for the Authority, states in her affidavit that significant work had been completed by the parties in response to those statements, including 18 pages of objections which has been prepared by the Authority in response to Mr Kingston's first witness statement.[36] By orders dated 25 July 2023, the parties were required to confer and circulate a document setting out the objections that remained in dispute by 4 August 2023. Ms Howard states that an agreement was reached between the parties on aspects of the objections, however substantial objections remained unresolved until the Authority was advised about the non‑calling of Mr Kingston on 1 August 2023.[37]

44 Ms Howard also states that the Court Book had also been finalised having regard to both of Mr Kingston's statements.[38]

45 During the trial, counsel for the Authority foreshadowed that the Authority would be seeking its costs thrown away as a result of the lateness of the notification that Mr Kingston would not be called.[39]

46 As a result of Mr Kingston's withdrawal, on 7 August 2023, the solicitors for the Authority received a letter from the Claimants' solicitor stating that the Claimants had issued a further instruction to Mr Haines two days earlier, on 5 August 2023 (the '5 August Instruction').[40] The 5 August Instruction stated that the Claimants were withdrawing parts of the instruction previously issued to Mr Haines on 3 June 2019 that related to the sale of the land referred to in the proceedings as the 'Permanent Trustee Land'.[41]

47 The first expert witness statement of Mr Haines dated 21 December 2021 contained Mr Haines' historical valuations of the Jomaring and Kingston properties as at 1983 and 1984.[42] Mr Haines disregarded the sale of the Permanent Trustee Land (and the Coram Land[43]) in arriving at rates per hectare considerably higher than the historical valuations of Mr Keck and Mr Colson. By the Joint Statement of Valuation Experts dated 16 November 2022, Mr Haines expressed his opinion 'that the Kingston land is at a rate 25% less than for the Jomaring Land'.[44]

48 The Authority states that no reference was made through the parties' expert valuation evidence or joint conferences of valuation experts to a sale of land that became known, during the trial, as the 'Follett Land'.[45]

49 On 3 August 2023, being the second day of the trial, the Authority's solicitor received from the Claimants' solicitor a bundle of new documents concerning the sale of the Follett Land. This 1979 sale of the Follett Land to AMP became a comparable sale upon which the Claimants sought to rely.[46]

Claimants' case as to hydrology and contamination

50 By [3] of its 2021 Particulars of Offer, the Authority reserved the right to revise its offer in circumstances relating to hydrology or contamination, which they say pleaded that valuation of the Properties may be affected by issues of hydrology or contamination.[47]

51 By orders dated April 2021, the Claimants were to file their expert evidence by 14 December 2021. There was no provision in the orders for reply evidence. The Claimants did not lead expert evidence in the disciplines of hydrology or contamination in 2021, although the Authority states that the First Haines Statement did have regard to the hydrological condition of the Acquired Land when opining on the market value of that land.[48]

52 The Authority had filed extensive expert evidence in response to the issues in dispute, including expert opinions on hydrology and contamination which were filed in March 2022.[49]

53 Ms Howard states in her affidavit that she first received the Claimants' contamination and civil engineering evidence, the latter of which considered hydrology, on 6 May 2022. She states that the assessment undertaken by the Claimants' hydrology expert did not contain hydraulic modelling.[50] The 6 May 2022 letter stated that a further report, dealing with hydrological issues, would also be produced. Ms Howard says she first received the Claimants' hydrology evidence on 20 May 2022.[51]

54 In August 2022, contamination and hydrology evidence was filed by the Authority in response to the Claimants' new evidence. The hydrology evidence included hydraulic modelling to determine the developable land area in relation to both properties.[52]

55 By orders dated 21 September 2022, the joint expert conclave process was to be completed by 25 November 2022.[53]

56 On 19 October 2022, Mr Callander sent Ms Howard an email attaching two new concept plans which provided 'for some further options for hypothetical development of the land', and regarding which Mr Callander stated that 'the Claimants may seek to rely upon those plans in addition to the plans already in evidence' (the 'October Plans'). One of the October Plans provided for a planning scenario that was not the subject of evidence filed in the proceedings.[54]

57 On 28 October 2022, a Joint Statement of Hydrology and Civil Engineering Experts was filed ('Joint Hydrology Statement').[55] At the joint conclave, the only modelling before the experts was that prepared by the Authority's hydrologist. The Joint Hydrology Statement did not identify developable land areas utilising the modelling that was available to the parties, stating that the Claimants would 'undertake further hydraulic modelling ... to test scenarios that optimise the developable area'.[56]

58 On 3 November 2022, the Joint Statement of Planning Experts was filed.[57] The joint conclave occurred on 15 September 2022, which considered those plans that formed part of the Claimants' December 2021 evidence.[58]

59 On 11 November 2022, the Joint Statement of Planning Experts was filed.[59] The planning experts met on 11, 19 and 25 October 2023 and Ms Howard states in her affidavit that the October Plans were not considered.[60]

60 By letters dated 24 October and 2, 11, 18 and 25 November 2022, Ms Howard expressed her concern that the introduction of new evidence at that late stage would mean the February 2023 trial date would not be able to be held and an adjournment would be required.[61]

61 By letters dated 25 and 30 November 2022, the Claimants produced nine new expert and lay statements that they sought to introduce into the proceedings. These comprised:[62]

(a) three statements addressing hydrological issues, which provided a model that sought to address flooding in a way that had not been addressed by the Authority;

(b) one statement which considered five concept plans, three of which were not in evidence in the proceedings and one which addressed a scenario which did not respond to the opinion of planning experts in the proceedings at that time; and

(c) a new valuation report of Mr Haines dated 23 November 2022 (the 'Second Haines Statement'), which responded to a letter of instruction dated 15 June 2022 and did not respond to the Claimants' other new evidence.

62 The balance of the evidence addressed novel issues of contamination in traffic and further lay evidence of Mr Kingston.

63 After a contested directions hearing, orders were made on 8 December 2022, by which inter alia the Claimants were granted leave to file their new suite of documents and the original trial date of 13 February 2023 was adjourned by six months, to commence on 2 August 2023.[63]

64 The Authority says that as a result of this adjournment, interest accrued across both proceedings at a total of approximately $32,405 for the intervening six‑month period until the trial ultimately commenced, having regard to the judgment sum awarded.[64]

65 On 15 December 2022, the Authority received a letter from the Claimants attaching a suite of concept plans upon which they intended to rely upon in the proceedings.[65] Ms Howard states that in December 2022, she instructed the Authority's experts to opine on these concept plans in accordance with this directive from the Claimants.[66]

66 On 3 March 2023, the Authority sent a letter to the Claimants advising that the developable land areas listed in the Second (Supplementary) Joint Statement of Hydrology and Civil Engineering Experts dated 10 February 2023[67] did not appear to correspond to those contained in the Claimants' concept plans in evidence to date.[68] The Authority sought to clarify a clear position with respect to the concept plans and developable land areas, and invited counsel for the parties to confer with a view to narrowing the issues in dispute and agreeing concept plans that properly reflected the positions advanced by the parties' experts.[69]

67 On 10 March 2023, the Claimants agreed to this course of action.[70]

68 On 28 March 2023, the Claimants produced five 'updated' concept plans dated 24 March 2023, as well as correlating developable land areas, and suggested that these new concept plans be provided to the parties' experts for further consideration.[71]

69 On 13 April 2023, the Claimants sent a letter to the Authority which attached three 'revised' concept plans dated 12 April 2023 (the 'New Plans'). These were said to be 'prepared in furtherance of discussions in an endeavour to streamline plans having regard to the evidence and joint statements'.[72]

70 On 17 April 2023, the Authority consented to the New Plans and received confirmation from the Claimants later that day.[73]

71 The parties agreed orders, ultimately made by the Court on 18 April 2023, which accommodated the Claimants' new planning evidence (which enclosed the New Plans), and timetabled supplementary expert evidence and conclaves that relied on these plans.[74]

72 The New Plans were the subject of the expert evidence filed in the proceedings from that time, which concerned hydrology, planning, contamination and valuation.[75]

73 On 13 June 2023, the Claimants sent a further expert report of Mr Haines (the 'Third Haines Statement') to the Authority.[76] This was received after the parties' joint conference of valuation experts was scheduled to have commenced and there was no order permitting Mr Haines to prepare this further report.[77]

74 On 28 June 2023, the Joint Statement of Valuation Experts of Mr Haines and Mr Willison was filed.[78]

75 On 4 July 2023, the Claimants advised that:[79]

(a) Mr Haines had been instructed to conduct a further review of his previous valuations including with regard to the concept plans produced by the Claimants in the proceedings on 20 December 2021;

(b) Mr Haines' review was anticipated by 10 July 2023; and

(c) this may require further conclave and the preparation of a further joint statement of the valuers.

76 At the 5 July 2023 directions hearing, leave was granted for the filing of the Third Haines Statement, which the Claimants ultimately filed on 6 July 2023.[80] At the hearing, I commented that:[81]

I am very conscious that we keep this matter on track for the 2 August trial date, and I do not want to take any steps that would potentially require a whole round of additional witness statements.

77 On the same day, the Claimants instructed Mr Haines to prepare a further statement, which was served on 12 July 2023 (the 'Fourth Haines Statement').[82] Ms Howard states that this statement addressed concept plans that the Authority had understood were no longer being relied upon, as well as two further concept plans dated 5 July 2023.

78 On 13 July 2023, the Authority sent a letter to the Claimants objecting to the Fourth Haines Statement.[83]

79 On 13 July 2023, the Claimants filed the Fourth Haines Statement[84] and circulated this statement by letter, noting that they would be seeking a regularising order from the Court and sought the Authority's consent to this course.[85]

80 On 17 July 2023, the Authority sent a letter to the Claimants stating that it did not consent to orders allowing for the filing of the Fourth Haines Statement.[86]

81 The parties were to appear before me at a directions hearing on 20 July 2023, which was ultimately adjourned to allow the parties to confer and which resulted in the parties agreeing market value and professional expenses as documented in the Joint Memorandum of Counsel dated 24 July 2023.[87]

Claimants' case in respect of solatium and disturbance losses

82 The Claimants' Particulars of Claim claimed specific entitlements with respect to solatium and disturbance losses, in accordance with ss 44 and 41(1)(d) of the LAC Act.[88]

83 The First Kingston Statement provided evidence supporting the Claimants' claims for solatium and disturbance.[89]

84 The parties' outline of opening submissions dealt with the Claimants' claims for solatium and disturbance.[90]

85 On the morning of 1 August 2023, the Claimants first advised the Authority that they were no longer calling Mr Kingston. However, the Claimants maintained the claims for solatium and disturbance in their opening submissions (depending on what came out in evidence) and withdrew them in closing submissions.[91]

86 On 30 August 2023, 13 days after the trial concluded, the Authority filed its Amended Particulars of Offer in each proceeding,[92] to correspond with its closing submissions.[93] It made a primary offer based on Mr Colson's valuations, of a combined $2,012,769, comprised of:

(a) $886,134 for Kingston; and

(b) $1,126,635 for Jomaring.

87 It also made an alternative offer, based on Mr Keck's valuations of $1,112,977 ($1,112,977 for Kingston and $0 for Jomaring) which was said to be in total compensation, including professional expenses.

88 On 23 October 2023, the Compensation Decision was delivered, holding that the Claimants were entitled to $2,239,578 in compensation across both proceedings, exclusive of interest and costs, comprising:

(a) $1,112,943 for the Kingston Proceeding; and

(b) $1,126,635 for the Jomaring Proceeding.

89 Taking into account amounts already advanced, the Authority was ordered to pay in aggregate the sum of $1,024,295.27 by 1 December 2023, comprising $720,882.82 for Kingston and $303,412.45 for Jomaring.

90 The Claimants seek orders for their costs in both proceedings on a standard basis and for certification for three counsel pursuant to s 91 of the LAC Act.

91 The Authority seeks an order that the Claimants pay the Authority's costs:

(a) on a standard basis until 10:00am on 2 August 2023, being the time when the Authority's Calderbank Offer lapsed (the 'Pre‑Calderbank Period'); and

(b) on an indemnity basis from 10:00am on 2 August 2023 (the 'Post‑Calderbank Period').

92 In the Pre‑Calderbank Period, the Authority relies principally on four matters, being that the Claimants should not have:

(a) sought to deny the relevance of previous compensation paid in respect of the Acquired Land ('Previous Compensation');[94]

(b) instructed Mr Haines to assume certain matters in respect of the sale of the Permanent Trustee Land;

(c) decided, on the eve of trial, not to call Mr Kingston as a witness even though he had previously prepared, filed and served lengthy witness statements; and

(d) increased the cost of the proceedings and the interest payable under the LAC Act by 'changing the case' in the way that they did.

93 In the Post-Calderbank Period, the Authority relies on these four matters in conjunction with the Claimants' refusal of the Authority's Calderbank Offer.

94 It is clear from the submissions that the parties agree on the principles applicable to costs awards made under the LAC Act.[95]

Court's jurisdiction in relation to costs under s 91 of the LAC Act

95 Both parties correctly accept that the source of the Court's power to award costs in compulsory acquisition proceedings is contained in s 91 of the LAC Act,[96] which provides as follows:

(1) In any proceedings under this Part, the Tribunal or the Court (as the case requires) may award such costs as it thinks proper but in making an order for costs must, if the Tribunal or Court considers it appropriate to do so, take into consideration -

(a) the amount of compensation awarded by the Tribunal or Court as compared with the amount (if any) offered by the Authority; and

(b) the extent to which, in the opinion of the Tribunal or Court, the proceedings have arisen from, or been affected by -

(i) unreasonable conduct on the part of the claimant or the Authority; or

(ii) the failure of the claimant to give adequate particulars of the claim or supply supporting material when required to do so; or

(iii) an excessive claim by the claimant; or

(iv) an unduly depressed offer by the Authority; and

(c) any other matters which under this Act are to be taken into account in determining the allocation of costs.

96 Under s 91, the Court has an overarching discretion to award such costs as it thinks 'proper'. In accordance with the text of s 91, in forming a view about what is 'proper', the Court must, if it considers it appropriate to do so, take into consideration the matters set out in s 91(1)(a)-(c).[97]

97 In assessing what is proper, it is well recognised that within the context of the overarching discretion of the Court there is a so‑called 'tilt' in favour of dispossessed owners.[98] This is described by their Honours Chief Justice Warren, Justice of Appeal Tate and Acting Justice of Appeal Emerton in Love at [173]:[99]

We accept that the position of a claimant in proceedings under the Act is not that of an ordinary litigant and that the starting point for the exercise of the Court's discretion as to costs is that the dispossessed owner should recover the costs of making the claim. The discretion as to costs in compensation proceedings is tilted in favour of the claimant.

98 The Claimants and Authority agree this 'tilt' applies. They also correctly accept that the 'tilt' does not serve to fetter the discretion conferred by s 91, which is explained by Justices of Appeal Tate, Kyrou and McLeish in Provans as follows:[100]

However, recognising the difference between compulsory acquisition cases and ordinary claims in general jurisdiction does not serve to fetter the discretion under s 91, which remains broad. As observed by Wells J in Minister for the Environment v Florence, in the passage extracted by Osborn J in Roads Corp, there is no hard and fast rule governing the exercise of the discretion.

99 Indeed, in their submissions, the Claimants accept that this 'tilt' is not equivalent to a hard 'presumption' in relation to costs.[101] Rather, '[e]ach case will be different and dependent on its own facts'.[102]

100 At the Costs Hearing, there was some jousting between the parties as to how much weight should given to the 'tilt' in the circumstances of this case. The Claimants submitted that the tilt is a 'decided' one, particularly in circumstances where the claimant recovers more than what was offered.[103]

101 By contrast, the Authority emphasised the Court's broad discretion, submitting that the notion of a 'tilt' in favour of claimants is most sensibly utilised where the seesaw is 'evenly' or 'finely' balanced, and in that scenario, it is helpful to refer to a 'tilt' in favour of claimants as a means of breaking that deadlock. However, it submitted that, critically, that is not the case here.[104]

102 In my view, it is enough to say that the Court's approach to the consideration of any 'tilt' in favour of a claimant is but one of the considerations to be taken into account. It is not a presumption in the claimant's favour but I accept that where there is a choice to be made in this type of claim that the 'tilt' will generally favour the claimant. However, the application of this consideration is not determinative and I endorse the comments of Justice Richards in Plunkett (No 2).[105]

Relevance of the Civil Procedure Act 2010 (Vic)

103 The Authority also referred me to the judgment of her Honour Justice Richards in Head, Transport for Victoria v Lantrak Developments Pty Ltd (Costs) [2021] VSC 863 ('Lantrak (Costs)') at [14], in which her Honour stated that:

The Civil Procedure Act 2010 (Vic) applies to proceedings under the LAC Act, to claimants and acquiring authorities alike. The 'tilt' in favour of claimants whose land has been compulsorily acquired does not relieve them of their obligations under the Civil Procedure Act.

104 The Authority submitted that under the Civil Procedure Act 2010 (Vic) ('Civil Procedure Act'), when determining costs this Court must have regard to any breach of an overarching obligation, so it is not the case that what is set out in s 91 is an exclusive code as to what the Court needs to take into account.[106] It submitted that the 'tilt' does not relieve the Claimants of cost consequences when they have engaged in unreasonable conduct or made an excessive claim which, it says, is self‑evident from the language in the section.[107] In accordance with my comments below at [282], [313] and [321], I agree that the Civil Procedure Act is relevant to the award of costs in this jurisdiction.

Section 91(1) matters which are enlivened by the circumstances

105 In support of their submissions, the parties identified various factual circumstances which they say enliven certain matters set out in s 91(1). The relevant factual circumstances (and the subsection of s 91(1) which they relate to) can be summarised as follows:

(a) Section 91(1)(a): whether the Claimants 'beat' the amount offered by the Authority;

(b) Section 91(1)(b)(i): whether the Claimants acted unreasonably in respect of the Authority's Calderbank Offer;

(c) Section 91(1)(b)(i): whether the proceedings were affected by unreasonable conduct of the Claimants, being the:

(i) Claimants' denial of the relevance of the Previous Compensation;

(ii) Claimants' instructions to their land valuation expert Mr Haines;

(iii) Claimants' decision to not call Mr Kingston to give evidence at trial; and

(iv) Claimants' 'changing the case'; and

(d) Section 91(1)(b)(iii): whether the proceedings were affected by an excessive claim for compensation by the Claimants.

106 These considerations are analysed below by reference to the parties' respective submissions.

Section 91(1)(a): whether the Claimants 'beat' the amount offered by the Authority

107 Section 91(1)(a) requires the Court to take into consideration, if it considers it appropriate to do so, the amount of compensation awarded by the Court as compared with the amount (if any) offered by the Authority.

108 The Claimants submit that the relevant amount offered for the purposes of s 91(1)(a) is that which is set out in the Authority's 2019 Pre‑litigation Offers, which were $1,518,619 in total.[108] The Claimants compared this with the $2,239,578 awarded in the Compensation Decision, together with $303,336.27 interest, to submit that they 'beat' the Authority's 2019 Pre‑litigation Offers by nearly 50%.[109]

109 By contrast, the Authority submits that the Authority's 2021 Particulars of Offer are the relevant offers. The Authority submits that these offers were for $1,724,922.31 (excluding interest and costs) and the compensation awarded by the Court - which it says was based on the Authority's evidence rather than the Claimants' evidence - was $2,239,578 (excluding interest and costs).[110]

110 The Authority submitted that the 2021 Particulars of Offer constitute the relevant offers for the purposes of s 91(1)(a) because they are properly characterised as offers 'formally [made] in the context of the regime for compensation set out in the LAC Act'.[111]

111 The Claimants disagree that the Authority's 2021 Particulars of Offer constitute the relevant offers, but submitted that even if they did, those offers were still less than the amount awarded.[112] The Authority conceded that, for this reason, the issue is of no real consequence.[113] However, it submits that the various offers, including the Authority's Calderbank Offer, remain relevant as part of the context for the Court's assessment of the reasonableness of the Claimants' conduct under s 91(1)(b)(i).[114]

112 It is clear that the Claimants did succeed in achieving an award greater than the offers made by the Authority, albeit only marginally in the context of the Claimants' sustained claim for (rounded) $49.499 million (or the alternative claim of $39.596 million).

113 In my view, both the 2019 Pre‑litigation Offers and the 2021 Particulars of Offer are relevant for the purposes of s 91(1)(a). Section 91(1)(a) refers to the amount 'if any' offered by the Authority. Unlike s 82 of the LAC Act, it does not explicitly confine its scope to the initial offer of compensation made by the Authority. The LAC Act regime allows the Authority to make subsequent offers and for claimants to apply for an advance on those offers. The 2021 Particulars of Offer are formal offers made in the context of that regime, and as such, are relevant for the purposes of s 91(1)(a). I reiterate my comments in Caradi at [33]. However, I agree the distinction is of no real consequence as both amounts offered fell short of the sum I ultimately awarded.

114 Although this was not raised by the parties, for completeness, I consider that a Calderbank offer of the kind in this proceeding, issued mere days before the trial, does not constitute an offer for the purposes of s 91(1)(a). However, as rightly put by the parties, it is a relevant consideration for the purposes of assessing unreasonable conduct under s 91(1)(b).

115 In the Authority's view, the fact that the Court awarded more compensation than the amount offered by the Authority does not, viewed in isolation, favour an award of costs against the Authority, there being no 'hard and fast' rule that a claimant who is awarded more compensation than the amount offered is to be awarded their costs, noting that 'other considerations may indicate a different result, depending on the circumstances of the particular case'.[115]

116 The Authority emphasised that s 91 does not stipulate that whether a claimant 'beats' the amount offered is the only or predominant consideration for the Court. Rather, it is a consideration among several that the Court must have regard to as it considers appropriate in the circumstances.[116] In the Authority's view, those circumstances include what they say are the 'tenuous and strained' nature of the Claimants' key legal argument, the 'manifestly inappropriate' instructions to their valuation expert, and the 'problematic' manner in which the Claimants changed their case throughout the proceedings. It submitted that these factors combine to compel the conclusion that the Authority should not be required to pay the Claimants' costs in the Pre‑Calderbank Period.[117]

117 The Authority also submitted that the reasons why the Court awarded more compensation than was offered are also relevant to the weight given to the comparison. In these proceedings, it says the Court rejected all of the Claimants' evidence and legal arguments. The reason why the Claimants received more than offered in the Authority's 2021 Particulars of Offer is largely because the Court relied on the evidence of Mr Colson in one proceeding and Mr Keck in the other.[118]

118 By contrast, the Claimants submitted that, while the factor is not itself decisive, it 'powerfully supports' the Claimants being awarded their costs and is 'perhaps the singular most significant consideration here', as it demonstrates that but for the litigation, the Claimants would not have received the compensation to which it is statutorily entitled.[119]

119 In my view, the fact that the amount awarded by the Court was greater than the amount offered is a positive factor in the Claimants' favour. While not itself decisive, the Claimants were effectively required to bring the matter to trial in order to obtain the compensation that they were statutorily entitled. However, I consider the comparatively small margin of that amount of relevance in weighing the s 91(1)(a) consideration, given the disparity with the size of the claim and the s 91(1)(b) considerations. These are matters which are also relevant and will be discussed further to follow.

Section 91(1)(b)(i): Claimants' refusal of the Authority's Calderbank Offer

120 Section 91(1)(b)(i) requires the Court to consider, if it considers it appropriate to do so, the extent to which, in the opinion of the Court, the proceedings have arisen from or been affected by unreasonable conduct on the part of the claimant or Authority. This may include an unreasonable rejection of a Calderbank offer.[120]

121 As discussed at [32]-[33] above, the Authority sent the Authority's Calderbank Offer on 28 July 2023 pursuant to which it offered to settle the proceedings for $6.5 million on an &#8[121]all in' basis.121 The Claimants did not accept the Authority's Calderbank Offer and compensation was ultimately assessed at trial to be little over $2.5 million (including interest and am[122]ts already advanced).122

122 Any such asserted unreasonableness is to be assessed as at the time the offer is made, not with the benefit of hindsight,[123] and taking into account all relevant circumstances, which usually include:[124]

(a) the stage of the proceeding at which the offer is received;

(b) the time allowed to the offeree to consider the offer;

(c) the extent of compromise offered;

(d) the offeree's prospects of success, assessed 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 indemnity costs in the event of its rejection.

123 Another factor which the Authority raised was a comparison between the final outcome and the terms of the compromise contained in the Authority's Calderbank Offer. In doing so, it referred to the decision of Justice Cavanough in Love v Victoria (No 2) [2009] VSC 531 at [30] where his Honour stated that 'a comparison between the final outcome of the case and the terms of the compromise offered would generally be a significant matter in assessing the "reasonableness" of the offer'.[125]

124 The Claimants submitted that they did not act unreasonably in rejecting the Authority's Calderbank Offer. They agreed with the Authority as to the relevant factors to be considered (set out in [[122 (a) knew the case put against them; and

(b) should be 'taken' to have accepted that a period for acceptance of around three to five days was sufficient due to the time allowed under the Claimants' Calderbank Offer.

135 In addition to the principal points proffered by the Authority, various other circumstances were raised by the parties as being relevant to whether the time allowed under the offer was sufficient.

Claimants' knowledge of the case put against them

137 In support of their first contention, the Authority submitted that the Claimants knew, during the period for acceptance, how the case was put against them. In particular, on the critical issue of whether the Previous Compensation was to be taken into account under s 41(5) of the LAC Act, the Claimants knew that the Authority relied on s 16(b) of the Interpretation of Legislation Act 1984 (Vic) ('ILA'),[134] the Claimants anticipated the way that case was put in their outline of opening submissions,[135] and they received confirmation of how that case was put when they received the Authority's outline of opening submissions which were filed on Monday 31 July 2023.[136]

138 By contrast, the Claimants submitted that Authority's offer did not explain, in argument or by reference to authority, why s 16(b) of the ILA, and alternatively s 206 of the Planning and Environment Act 1987 (Vic) ('P&E Act'), should affect the meaning of s 41(5) of the LAC Act. They submitted that the first time the Authority gave any explanation as to those propositions was in its written opening submissions, provided to the Claimants on Monday 31 July 2023, which devoted seven pages to explaining the Authority's position.[137] They submitted there was no elaboration on the Authority's position on the s 41(7) issue in the Authority's Calderbank Offer.[138]

139 At the Costs Hearing, the Claimants elaborated further to say that while the Authority's written submissions were provided on the Monday prior to the Wednesday trial commencement date, and from that point there was an exposition of the Authority's position on s 16(b), by then, the Claimants had already sent the Claimants' Calderbank Offer and that did not cover s 41(7) and the 'B' value issue.[139]

140 The Authority submitted by way of reply at the Costs Hearing that the point regarding s 16 was articulated in the Authority's 2021 Particulars of Offer, and was self‑evident, such that when the Claimants filed their written submissions on the Monday morning, they had 'correctly' and 'precisely' articulated the case that the Authority had put against them, meaning that the Claimants understood the case against them while the Authority's Calderbank Offer was still open.[140]

141 The Authority further submitted that the Claimants' submission regarding the 'B' value was only raised for the first time in the middle of the afternoon on Thursday 27 July 2023, being one day before the Authority's Calderbank Offer was served, and about two and a half years after the litigation had commenced. It was therefore entirely reasonable for the Authority's Calderbank Offer not to have dealt with that question.[141]

Should the Claimants be 'taken' to have accepted that the period of time allowed was sufficient?

142 The second reason given by the Authority that the time allowed was sufficient is that the Claimants' Calderbank Offer was sent at 7:36pm on 28 July 2023 and expired at 6:00pm on 4 August 2023,[142] and that the Claimants' restating of the offer was given at 4:36pm on 4 August 2023.[143] On this basis, the Authority submitted by reference to the New South Wales Court of Appeal decision of Elite Protective Personnel Pty Ltd v Salmon [2007] NSWCA 322 ('Elite') that the Claimants should be 'taken' to have accepted that a period for acceptance of around three to five days was sufficient.[144]

143 In their reply submissions, the Claimants rejected the proposition that, on the authority of Elite, the Claimants should be 'taken' to accept five days as a reasonable period to leave the offer open, given the Authority allowed six days. They submitted that Elite does not lay down a rule that the terms of a counter‑offer dictate whether or not a first offer was reasonable. The Claimants further submitted that Elite occurred in a different context, where the offers were made at least eight months before the trial.[145]

144 The Claimants further suggested that both the Authority's Calderbank Offer and the Claimants' Calderbank Offer did not leave a sufficient time for acceptance for them to 'bite' under the Calderbank principles.[146]

Other circumstances relevant to whether the time allowed under the offer was sufficient

145 Both parties made extensive written and oral submissions as to why the time allowed under the Authority's Calderbank Offer was, or was not, sufficient in the circumstances.

146 The Claimants submitted that the time allowed was inadequate because the short period did not allow Mr Kingston a proper opportunity to consider and reflect upon the offer given the demands of trial preparation, given the time would inevitably have been fully occupied with trial preparation.[147] Mr Callander states in his fourth affidavit that at the time the Authority's Calderbank Offer was received, his legal team was extremely busy preparing for trial[148] and due to the pressure of that work, he had limited opportunities to discuss the offer with Mr Kingston and that Mr Kingston did not have the opportunity of discussing the offer directly with counsel.[149]

147 The Claimants noted the fact that as the offer was a joint one to both Claimants, it could only be accepted by both Claimants, or neither, which they say should also be considered in the Court's overall assessment of the circumstances.[150]

148 The Claimants compared the time allowed under the Authority's Calderbank Offer to the time allowed in Provans, where the Authority's successful Calderbank offer was open for 28 days.

149 The Claimants also submitted that the Claimants' Calderbank Offer would constitute a counter‑offer that amounted to rejection of the Authority's Calderbank Offer and realistically needed to be sent out on the same day.[151]

150 In response, the Authority reiterated its submission that by this point in the proceeding the Claimants well understood the way the Authority put its case.[152]

151 At the Costs Hearing, the Authority referred me to the recent New South Wales Supreme Court decision of SSABR Pty Ltd v AMA Group (No 2) [2024] NSWSC 24 ('SSABR'), and the cases of Kooee Communications Pty Ltd v Primus Telecommunications Pty Ltd (No 2) [2008] NSWCA 85 ('Kooee') and Goo v Sim (No 2) [2022] NSWSC 651 cited therein to support its contention that the time an offer to settle is open for acceptance could, depending on the prevailing circumstances and factors affecting the parties themselves, be as little as (or less than) 24 hours. Such relevant factors include the presence of experienced legal counsel and solicitors capable of giving an immediate assessment of the offer and the overall ability of the offeree to understand the offer.[153]

152 The Authority submitted, consistently with the above cases that:

(a) the counsel and lawyers for each of the parties in these proceedings were experienced[154] and well‑placed to provide immediate advice on whether the offers were worthy of consideration and acceptance;[155]

(b) the parties served offers on each other on the same day, suggesting that they had formed the view that there was sufficient time before the commencement of the trial for the offers to be considered;[156]

(c) the offers did not 'come out of the blue' - they followed the mediation that had taken place just two weeks earlier;[157] and

(d) the individual behind the corporate applicant was an experienced business person who was likely well able to understand the advice he was given and to give prompt instructions.[158]

153 The Authority emphasised that Mr Kingston is an experienced and sophisticated business person who has legal training and was extremely well represented by three barristers and an experienced solicitor, and had there been any concerns about the terms of the offer, or period for its acceptance, those concerns would have been voiced, but they were not, and in particular, no extension was sought.[159]

154 In reply, the Claimants submitted that every case turns on its own facts and SSABR is distinguishable on the basis that 'the defendants' offer in that case did not come "out of the blue"',[160] but rather, the plaintiffs had signalled that they were ready to treat.[161] They submitted that the reverse is true here: the Claimants were busy preparing for trial and had given no such signal.

155 They further submitted that in SSABR, the evidence was that the plaintiffs were physically 'ensconced' with their counsel, in a position to take direct advice, while the evidence here is that the Claimants were not 'ensconced' with their counsel.

156 The Claimants submitted that SSABR is useful in the way that it collects dicta about late offers and that those principles are important and relevant here, including that:

(a) it may not be unreasonable to reject a late offer, considering, in particular, that late offers are a significant distraction in trial preparation;[162]

(b) it may not be unreasonable to reject a late offer in a complex case;[163] and

(c) 'the court should not be ungenerous to the offeree' in deciding the issue of reasonableness of time allowed to consider the offer.[164]

157 The Authority submitted that even if it were accepted that the sending of the Claimants' Calderbank Offer occupied all of Mr Kingston's time on Friday 28 July 2023, that accounts for only the first day of the period during which the Authority's Calderbank Offer was open for acceptance.[165] Once the Claimants' Calderbank Offer had been sent, Mr Kingston had four days (including two business days) to consider the Authority's Calderbank Offer.

158 It further submitted that the material before the Court does not support the conclusion that, in that four‑day period, Mr Kingston did not have sufficient time to consider and reflect upon the Authority's Calderbank Offer. At the Costs Hearing, it submitted that there is no evidence supporting this point from Mr Kingston himself, and invited the Court to consider that the evidence of Mr Callander in his fourth affidavit is scant and unpersuasive.[166]

159 In particular, it was submitted that there is no evidence of what Mr Kingston did or did not do on the remaining four days that the Authority's Calderbank Offer remained open and that, had it been thought that the offer had been impliedly rejected by the filing of the Claimants' Calderbank Offer, Mr Callander could have simply sought confirmation that the Authority's Calderbank Offer remained open until 10:00am on 2 August 2023, which he did not do.[167]

160 The Authority submitted that the Court cannot be satisfied, on that material, that Mr Kingston was personally required to attend to trial preparation when he was represented by an experienced solicitor and three members of counsel and he knew (for at least part of the period during which the Authority's Calderbank Offer was open for acceptance) that he was not going to be called to give evidence.[168]

161 The Authority submitted that in any event, the time allowed for acceptance of the Authority's Calderbank Offer 'is but one circumstance to be considered and should not by itself lead to any prima facie conclusion', and if the Court were concerned by the time allowed for acceptance, it is relevant that the Claimants did not request an extension of time.[169]

162 I am of the view that the course adopted by the Claimants to reject the Authority's Calderbank Offer and proceed to trial was one they had committed to having initiated the claim on the terms that they did. It was in effect an 'all or nothing' run at the litigation. They accepted the risk that the interpretation of s 41 would require the earlier significant compensation paid to be called into account. Acceptance of the offer made in the Authority's Calderbank Offer would in effect be to capitulate on the key legal issue and the issue which had the most effect on the quantum of compensation payable. This was a course they chose to pursue, one can infer, being fully informed of the risks given the quality of the legal team advising them.

163 As previously stated at [131], it is reasonable to infer that at this stage of the proceedings (being at the eleventh hour) the Claimants had turned their mind to the strengths and weaknesses of their case. However, committed to their view of the application of s 41(5) (being it did not operate to their circumstances), I doubt whether any amount offered unless very close to the claim would have been accepted by the Claimants at any time in the proceeding, including on the eve of trial.

164 Their alternative argument that Mr Haines' evidence, if accepted, would have delivered a higher compensation figure is acknowledged. However, as discussed in the Compensation Decision at [341]-[348] and [433], I found that Mr Haines' evidence was tainted by the erroneous instructions given to him which is a factor that is relevant to the adverse manner in which the litigation was run by the Claimants. At the time of the Authority's Calderbank Offer, the Claimants were aware of the valuation evidence put against their claim and the effect of it, if accepted.

165 Given this view, the time period the offer was open was reasonable in the circumstances.

166 The Authority submitted that the Authority's 2021 Particulars of Offer was for approximately $1.7 million (excluding interests and costs) while the Authority's Calderbank Offer was for $6.5 million (on an 'all in' basis). It submitted that this was a 'significant' and 'genuine' compromise, having regard to the Claimants' prospects of success at trial.[170]

167 The Claimants submitted that the Authority's Calderbank Offer is not directly comparable with the amounts previously offered, as the latter were not 'all in' offers.[171]

168 Whilst the Claimants accepted that the Authority's Calderbank Offer was an improved offer, they submitted that the extent of that improvement is limited, relative to the quantum of the Claimants' claim which was in excess of $50 million (or even the alternative claim in excess of $40 million), and their costs as at the date of the offer which were approximately $1.7 million.[172]

169 Given the views I have expressed at [130]-[131] and [162]-[163] above, the attraction of the offer made was not one which the Claimants were ever likely to accept.

170 I accept the Authority's Calderbank Offer did represent a higher offer than the amounts offered by the Authority but the differential between the possible judgment pay day of around $50 million and acceptance of the significantly more modest, but ultimately correct ballpark figure was a choice that they were not likely to accept given that the legal issue underpinning the Claimants' claim was a live one. They would be well aware of the risks of the failure of the legal argument and the rejection of Mr Haines' evidence over that of the Authority's evidence.

171 However, I consider the amount offered and its terms represented a genuine offer to settle the proceedings at a time prior to which further significant costs were to be incurred in the running of a two week trial with the parties represented by a senior counsel and two junior counsel on both sides.

172 The offer of $6.5 million 'all in' in this context was one which was generous from the Authority's perspective but not attractive given the Claimants' expectations. That said, I find that it was a reasonable compromise offered.

Offerees' prospects of success, assessed at the date of the offer

173 The Claimants submitted that they had reasonable prospects of success, judged at the time of the making of the Authority's Calderbank Offer, rather than in hindsight.[173] In essence, they submitted that their argument in respect of s 41(7) had sufficient legal basis and their alternative case - which turned on the prospect of the Court accepting Mr Haines' evidence - was reasonable given he is an experienced valuer whose evidence has been accepted by the Court previously.

174 In contrast, the Authority submitted that the Claimants' prospects of success on their construction point in respect of s 41(7) of the LAC Act were always low and it was 'always clear' that there was no basis for making the allegations that underpinned Mr Haines' valuation evidence, and that the Claimants' prospects of being awarded compensation 'even in the vicinity' of $6.5 million were equally low.[174] Further, it argued that the Claimants should have significantly discounted their claim when considering the offer, and had they done that, acting reasonably, they would have realised that the offer was a generous one.[175]

175 The Authority further submitted that during the period that the Authority's Calderbank Offer was open, the Claimants decided that they would not call Mr Kingston to give evidence. Once they had made that choice, they should have known that Mr Haines' evidence was fundamentally compromised or undermined such that their prospects of persuading the court that his evidence should be accepted were also very low.[176]

176 The Claimants submitted that that a claimant who rejects an offer to settle a claim which turns on facts within their own knowledge may be more susceptible to a costs order as opposed to a claimant who rejects an offer based on facts outside their knowledge or a claim which turns on competing constructions of law.[177]

177 The Authority submitted in reply that this proposition favours the Authority's position and that matters such as the 'unreasonable' legal construction arguments and its impact on the Claimants' instructions to Mr Haines were all within Mr Kingston's - and therefore the Claimants' - knowledge within the period for accepting the Authority's Calderbank Offer.[178]

178 The Authority's Calderbank Offer referred to the Supreme Court of Victoria decision of Brompton Lodge Pty Ltd (in admin) v Head, Transport for Victoria & Anor (No 2),[179] a case in which the Court awarded indemnity costs in favour of the Authority, a relevant factor being that the claimants had rejected a Calderbank offer in circumstances where '[i]t was apparent that there were significant legal obstacles which the claimants had to overcome if they were to be successful'.[180]

179 In their written submissions, the Claimants sought to contrast the circumstances of the present case with that of Brompton Lodge:[181]

This litigation was very different to Brompton Lodge, where the claimants were ordered to pay indemnity costs for refusing a Calderbank offer. In that case, the claimants failed on a question of fact (whether they had sold their land for a lower price because of the existence of a reservation), yet they knew when presented with the offer what the true facts were.[182] As such, they should have known they were bound to fail. In contrast, in these proceedings, the Claimants could not have known that the Court was to reject their propositions of law, and prefer the evidence of Mr Keck over Mr Haines.

180 The Authority rejected the Claimants' characterisation of Brompton Lodge,[183] submitting that the claimants in Brompton Lodge failed, in part, on a question of law. In that case, which concerned a claim for loss on sale under ss 98(1) and 106 of the P&E Act, his Honour Justice Garde recorded the claimants' submissions as including that 'there is no requirement under ss 99(b) or 106(1) that the sale price be the affected value of the land'.[184] The Authority submitted that the characterisation of this as a question of law was made clear by the Court of Appeal (which granted leave to appeal but dismissed the appeal) when it said:[185]

The basic proposition advanced by the applicants is that where loss on sale is relied upon as giving rise to a right to compensation for the imposition of a reservation, the loss does not have to be assessed by reference to the actual sale or, more specifically, by the actual sale price.

181 The Authority submitted that the applicants' proposition in that case was rejected at trial (and on appeal), and it was the rejection of that proposition (in combination with certain factual findings) that resulted in the claimants receiving no compensation. On the subsequent question of costs, Justice Garde said:[186]

At the date of the offer, the parties were well advised and the prospects of success were capable of evaluation. It was apparent that there were significant legal obstacles which the claimants had to overcome if they were to be successful. They had existed from the outset. While the parties developed their submissions and arguments at the trial, there was nothing that occurred during the trial that altered the underlying issues.

182 The Authority submitted that the decision in Brompton Lodge, properly understood, supports the Authority's position as the underlying facts of Brompton Lodge are similar to the present, in that in both cases the claimants sought to be compensated for loss that they did not suffer by making strained arguments about the interpretation of the relevant statutes. Brompton Lodge also provides a recent example of where standard costs were awarded in favour of the Authority before the expiry of the Calderbank offer and indemnity costs were awarded in favour of the Authority after that time.

183 In their reply submissions, the Claimants emphasised that the prospects of success should be evaluated in a context where the potential award at stake was high; they submitted that the significant costs already incurred in the litigation and with the 'C' value agreed at $34 million, if they succeeded in any one of their arguments that s 41(5) of the LAC Act was not engaged, they would necessarily receive approximately $51 million (including interest).[187]

184 In reply, the Authority submitted at the Costs Hearing that if the Court finds that the Claimants' case was very weak and the offer was generous, the fact that the Claimants had already incurred significant costs should not have informed their decision whether to accept the Authority's Calderbank Offer: 'the fact that they had incurred those costs didn't turn an unreasonable decision into a reasonable one.'[188]

185 I accept that the prospects of success must be assessed as at the date of the offer and not in hindsight. I do not consider Brompton Lodge to be particularly analogous to this case. It arose in different circumstances and concerned the claimant's inability to prove that that financial loss had been caused under s 98(1) of the P&E Act or that land had been sold at a lower price than might have reasonably been expected under s 106(1) of the P&E Act.[189] In this case, the legal question of the correct interpretation and application of s 41(5) and (7) of the LAC Act was one which had not been the subject of judicial interpretation. Given the significant difference in compensation that would result from a different legal interpretation to that which I determined to be the correct approach, it is understandable that the Claimants were prepared to take the risk and pursue the claim to its conclusion. I reiterate my comments made at in [130]-[131], [162]-[163] and [170] above.

186 Was that an unreasonable approach for the Claimants to take in all the circumstances?

187 With hindsight, no. But the examination of the issue is required to be undertaken at the date of the offer. At that time there was a legal question 'open' to the Claimants to pursue, even in the face of the Authority's contrary position being articulated and the Claimants no doubt being aware of the principle that the Claimants would not be entitled to a windfall or to be over‑compensated having received earlier compensation. The bottom line is, there was a live legal question to be determined. Although ultimately the Claimants argument did not succeed, and on one view could be categorised as ambitious and speculative in all the circumstances, it was a legal question without judicial consideration prior to this proceeding.

Clarity with which the terms of the offer were expressed

188 The Authority submitted that the Authority's Calderbank Offer was clearly expressed as follows:

Notwithstanding the weakness of the Claimants' position, in a genuine attempt to resolve these disputes and to avoid the costs and uncertainty of litigation, the Authority (without admission) offers the Claimants in full and final settlement of the Proceedings an 'all in' amount of $6,500,000 (inclusive of amounts previously advanced in the amount of $1,518,619 and with no GST payable).

This 'all in' offer ...

(a) comprises market value, solatium, all pre‑referral costs incurred by the Claimants, interest and all litigation costs incurred by the Claimants in the Proceedings to date;

(b) is reduced by the prescribed amounts which, for the reasons set out in this letter, is calculated in accordance with section 41(7) and protects against double compensation.

189 The Claimants did not make submissions directly addressing this point, however, I note their submissions that the Authority's Calderbank Offer was deficient to the extent that it did not explain the Authority's legal position in respect to the legal construction questions at issue between the parties.[190]

190 I acknowledge the concern expressed by the Claimants as to the articulation of the legal construction issues between the parties. However, on balance I am of the view that the Authority's Calderbank Offer sufficiently articulated the terms and basis of the offer.

Whether the offer foreshadowed an application for indemnity costs

191 The Authority submitted that the Authority's Calderbank Offer (the relevant parts of which are extracted below) clearly foreshadowed an application for indemnity costs by reference to the principles outlined in Calderbank v Calderbank [1975] 3 All ER 333 and Brompton Lodge:[191]

This offer is made in accordance with the principles outlined in Calderbank v Calderbank [1975] 3 All ER 333. If the Claimants do not accept this offer and they obtain a judgment equal to or less favourable to them than this offer, the Authority will produce this letter to the Court on the question of costs and seek an order for payment of the Authority's costs on an indemnity basis from the expiry of the deadline for acceptance of this offer.

[...]

Further, we draw your attention to the judgment of Brompton Lodge Pty Ltd (in administration) & Ors v Head, Transport for Victoria & Anor (No 2) [2020] VSC 881, in which the Court awarded indemnity costs in favour of the Authority. Relevant to this conclusion was the fact that the claimants had rejected a Calderbank offer, in circumstances where 'it was apparent that there were significant legal obstacles which the claimants had to overcome if they were to be successful'. Similarly, in this case, to press a claim for compensation would carry significant legal and factual obstacles.

192 No submissions were made by the Claimants on this point, however as discussed at [179] above, I note their submissions which sought to distinguish Brompton Lodge from the present circumstances.

193 It is clear from its terms that the Authority's Calderbank Offer did raise the warning that indemnity costs would be sought.

Comparison between the final outcome and the terms of the compromise

194 The Authority submitted that the final outcome of the proceedings is that the Authority must pay the Claimants a little over $2.5 million (including interest and amounts already advanced) and that the Authority's Calderbank Offer of $6.5 million ('all in') was significantly more generous than this.

195 The Claimants' submissions do not appear to address this point directly.

196 As noted above at [170], the Authority's Calderbank Offer was in excess of the amounts previously offered and was an amount which represented a genuine offer to settle the proceeding. The amount of the judgement achieved by the Claimants was under what the $6.5 million 'all in' offer represented.

Was it unreasonable for the Claimants to refuse the Authority's Calderbank Offer?

197 In summary, it was not unreasonable for the Claimants to refuse the Authority's Calderbank Offer. While the factors canvassed above cut both ways to a degree, when considered together, it does not reveal conduct by the Claimants which justifies a costs order against them. In reaching this view, I have had particular regard to the fact that, by the time the Authority's Calderbank offer was received the parties were so far apart due to the divergent positions each side took on the interpretation of s 41(5) and (7) of the LAC Act. Reaching a compromise of the kind sought by the Authority would have involved a significant capitulation by the Claimants on the primary position they had committed to, such that agreement on such terms was practically impossible.

198 Section 91(1)(b)(i) requires the Court to take into consideration, if it considers it appropriate to do so, the extent to which, in the opinion of the Court, the proceedings have arisen from, or been affected by, unreasonable conduct on the part of the claimant or Authority.

199 The Authority submits, as set out at [105(c)] above, that the proceedings were affected by the unreasonable conduct of the Claimants, both before and after the Authority's Calde[192]nk Offer.192 In her sixth affidavit, Ms Howard [193]ted that:193

The effect of the [Claimants'] denial of the relevance of the Previous Compensation and the improper instruction of Mr Haines, together with [Claimants'] conduct in relation to Mr Kingston and the changes to their case more broadly, greatly increased the costs to the [Authority] of defending the claims, including with respect to legal fees, expert fees and interest. It also made an agreement about the compensation payable impossible in the circumstances.

200 It is the Authority's leading submission that it is the collective effect of these factors which should compel the Court to make the costs award it is seeking.[194]

201 At the Costs Hearing, the Claimants submitted that no weight should be given to this paragraph of Ms Howard's affidavit on the basis that it is really a submission or argument that involved conclusory elements.[195] The Authority rejected this submission, contending it is an opinion made by Ms Howard who has extensive experience in this jurisdiction, and it is admissible and weight should be given to it.[196]. I have formed the view that this paragraph is in the nature of a submission, albeit an informed one. However, the substance of it was adopted by the Authority and in effect nothing turns on the objection.

202 The Authority submitted that the proceedings 'arose from' the Claimants' denial of the relevance of the Previous Compensation and improper instruction of Mr Haines in that, if the Claimants had accepted that:[197]

(a) the Previous Compensation should be taken into account; and

(b) the contemporaneous valuations of Mr Colson and Mr Keck were the best evidence of market value as at the relevant date,

then it is overwhelmingly likely that the parties would have been able to agree to a compensation figure without the need for a lengthy and expensive trial. However, such an agreement was impossible in circumstances where the Claimants, by reason of their stance on the Previous Compensation and the evidence of Mr Haines, sought compensation in excess of $52.7 million (plus interest and costs).

203 These submissions were rejected by the Claimants who argued in their oral submissions that in assessing unreasonableness, it is incumbent on the Court to assess these matters as at the date, or as at the time at which the relevant matters were occurring and without the benefit of hindsight.[198]

204 The Claimants emphasised the fact that the Authority's arguments in respect of unreasonable conduct are cumulative and submitted that if it is a collective approach, then once there is a rejection of one or more of those components, the basis for the orders sought in the way that the Authority itself has put it falls away.[199]

205 They further emphasised the presence of the words 'been affected by' in the text of s 91(1)(b) in submitting that even if some of the alleged conduct is found to be unreasonable, I should find that the extent to which such conduct 'affected' the proceedings is not so great that it should justify the costs award sought by the Authority.[200]

206 Each factual matter alleged to constitute 'unreasonable' conduct is analysed below, with reference to the parties' submissions.

Claimants' denial of the relevance of the Previous Compensation

207 The Authority submits that the Claimants should not have sought to deny the relevance of the Previous Compensation, submitting the points set out below.[201]

(a) It is axiomatic that an owner is entitled to be compensated fairly and fully for his or her loss, but 'is not entitled to receive more than fair compensation'.[202]

(b) There was simply 'no evidence' that the Previous Compensation was anything other than compensation paid to the Previous Claimants[203] pursuant to the Town and Country Planning Act 1961 (Vic) ('TCP Act').[204]

(c) Mr Kingston and Mr Callander were personally involved in the process by which the Previous Claimants claimed, and then received, the Previous Compensation.

(d) Until the commencement of the LAC Act, it was clear that the Previous Compensation would have been taken into account in the assessment of compensation for acquisition under s 42(4) of the TCP Act.

(e) In the 11‑week period between the commencement of the LAC Act and the commencement of the P&E Act, it was clear that the Previous Compensation would have been taken into account in the assessment of compensation for acquisition under s 41(5) of the LAC Act.

(f) The Claimants sought to take advantage of the amendment of s 41(5) on 16 February 1988 so as, in effect, to be compensated twice for the same loss.

(g) The Claimants knew from at least 26 March 2021 (when they received the Authority's 2021 Particulars of Offer) that the Authority's position was that the P&E Act was a re‑enactment of the TCP Act for the purposes of s 16(b) of the ILA.

(h) It was at all times 'clear that Parliament's intention with respect to the TCP Act and P&E Act was one of substantial re‑enactment', but the Claimants sought to avoid this by advancing an approach to the statutory interpretation task that failed to embrace the appropriate 'contextual and purposive approach to the legislation'.[205]

(i) Taking that approach was unreasonable.

208 At the Costs Hearing, the Authority submitted that by denying the relevance of the Previous Compensation, the Claimants were in effect seeking to be compensated twice for the same loss, and in the circumstances, this amounted to unreasonable conduct for the purposes of s 91 of the LAC Act.[206]

209 The Authority also submitted that if the Claimants had accepted that the Previous Compensation had to be taken into account, and if they had instructed a valuation expert without colouring their evidence with inappropriate assumptions, then the compensation sought by the Claimants would have been close to the amount awarded by the Court.[207]

210 The Claimants reject the submission that it was unreasonable for the Claimants to deny the relevance of the Previous Compensation - that they were 'perfectly proper, perfectly valid and perfectly reasonable to put' and concerned issues that were novel and complex.[208]

211 Further, the Claimants submitted that the Authority did not, in the course of the trial, suggest that the Claimants' arguments were unreasonable, rather than wrong and that the points taken were clearly arguable and the issues being complex and without authority.[209]

212 The Claimants submitted it would be erroneous to find that a claimant who is a dispossessed owner to maintain the legal contentions that it did maintain on trial - on which turned well over $40 million of compensation - is so unreasonable as to warrant a costs order.[210] They argue that armed with the Compensation Decision and with hindsight, it is easy to say the legal arguments were unreasonable, but that is very different to those arguments being of that characterisation as properly assessed at the time they were made.[211]

213 The Claimants submitted that they only understood how the Authority put its argument in respect of s 16(1)(b) of the ILA shortly before trial when it received its written submissions, and it was only upon the oral openings at trial that it was known to the Claimants how the Authority put its argument on the construction of the definition of the 'B' values.[212]

214 The Claimants submitted that the vast bulk of the costs of the litigation were taken up with other issues so even if there had been any unreasonableness of the Claimants in denying the relevance of the Previous Compensation, it could not be said to have 'affected' the costs of the proceedings in 'only a partial manner'.[213]

215 The Claimants submitted that the legal issues, while so much turned on them, were a fractional part of the pre‑trial costs, so even if the arguments were unreasonable, this should not translate to the costs order that the Authority seeks.[214]

216 By way of reply, the Authority submitted in oral submissions that the fact that the Authority did not submit the arguments were unreasonable at trial should be rejected; such an approach would not have assisted the Court and the Authority appropriately directed its submissions to the substance of what was in dispute at trial.[215]

217 It further submitted that its submissions at trial are consistent with those made at the Costs Hearing, being that the Claimants' construction of the legislation would produce an irrational result and their arguments that the Previous Compensation was not compensation at all, were 'remarkable' and 'simply couldn't be right'.[216]

218 The legal question was resolved in favour of the Authority. The determination of the correct meaning and effect of s 41(5) and (7) of the LAC Act was not straightforward. It was a complex and novel question which was the subject of detailed argument from both parties.

219 It is of course easy in hindsight to form the view that there was no validity in the position advanced for the Claimants. Intuitively, taking into account the history of compensation for compulsory acquisition and the principles of just compensation, it may well be assumed that the Authority was always going to prevail. The claim had in this respect a high component of speculation or ambition. However, the argument was not previously settled and whilst there was risk involved for the Claimants to run this litigation to its end, the spoils were significant.

220 Whilst some of the forensic and procedural decisions made the Claimants have added unnecessarily to the costs and time taken in running the litigation (and these actions are properly categorised as being unreasonable and are dealt with below), I do not consider in all the circumstances running the legal argument to be unreasonable.

Claimants' instructions to their land valuation expert Mr Haines

221 The Authority submitted that the Claimants' instructions to Mr Haines were unreasonable because he was instructed to make presumptions which were not supported by a reasonable interpretation of the law or the evidence.

222 It submitted that practically from the outset of his engagement, Mr Haines was instructed to assume that:[217]

(a) the sale price of the Permanent Trustee Land 'does not, or may not, reflect the market value of the land transferred as at that date';

(b) the Previous Claimants 'were not then or may not then have been cognisant of all circumstances which might affect its value';

(c) the Previous Claimants 'were, or may have been, over anxious to sell'; and

(d) the sale of the Permanent Trustee Land 'was or may have been forced on them'.

223 It further submitted that the Court should infer that Mr Haines was instructed in this way because the Claimants wished to establish that the Permanent Trustee Land was worth considerably more than the amount for which it was sold.[218]

224 The Authority also submitted that Mr Haines' instructions rested on, in large part, 'the not‑so‑subtle attempts to create an odour around the role of Mr Lawson', notwithstanding that:[219]

(a) there was no evidence that Mr Lawson acted dishonestly or unethically;

(b) there was no evidence that Mr Lawson was acting on behalf of both parties in respect of the sale of the Permanent Trustee Land;

(c) the evidence established that the Previous Claimants were prudent, well‑informed, and willing but not anxious vendors of the Permanent Trustee Land; and

(d) conversely, there was no evidence to suggest that the Claimants were 'not willing to sell the Permanent Trustee Land or were anxious to do so', 'not cognisant of all the circumstances surrounding the sale of the Permanent Trustee Land', or 'otherwise not well‑informed'.

225 The Authority submitted that, consistently with his instructions, Mr Haines disregarded the sale of the Permanent Trustee Land (and the Coram Land) in his valuation reports and as the Joint Statement of Valuation Experts makes clear, the significant reason for Mr Haines disregarding these sales was 'his concern that Mr John Lawson was involved in these transactions, acting for both parties' and that consequently, both sales were not reliable market indicators of value.

226 The Authority further submitted as follows:[220]

(a) On the third day of the trial, Mr Callander wrote to Mr Haines withdrawing those instructions.[221] As a consequence, the foundation that underlay the critical divergence between Mr Haines' and Mr Keck's valuation evidence was removed.

(b) Mr Haines claimed that the withdrawal of the relevant instructions did not alter his conclusions and opinions.[222] Nonetheless, during cross‑examination, Mr Haines 'could not explain why [he had formed the view that the sale of the Permanent Trustee Land was a low sale] without referring to the so‑called "dual role" of Mr Lawson in the transaction'.

(c) The only available conclusion was that Mr Haines remained 'influenced by the instructions given at the outset (despite their withdrawal and [Mr Haines'] express disavowal of them as a factor)'.

(d) In summary, until the withdrawal of the relevant instructions to Mr Haines, Mr Haines' evidence 'expressly rested, in large part, on an unfounded allegation of improper conduct on the part of Mr Lawson'. It is 'trite' that where unfounded allegations of improper conduct are made and, as a result, unnecessary costs are incurred, a special costs order is appropriate.[223] In the present case, the allegations were not pursued at trial, but their effect lingered.

(e) Had Mr Haines not been instructed as he was, the parties, acting reasonably, would have proceeded on the basis that the sale of the Permanent Trustee Land was the appropriate benchmark for the value of the Kingston Land, and the parties could readily have reached agreement on the value of the Jomaring Land. That being so, all of the costs associated with the 'B' value (including in relation to Mr Keck) were unnecessarily incurred.

227 The Claimants rejected the Authority's submission that it was unreasonable for the Claimants to give Mr Haines his original instructions, to the effect that the Permanent Trustee Land sale might not reflect market value, because there may have been vendor anxiety, vendor ignorance, or pressure from Mr Lawson.[224]

228 The Claimants submitted that when the instructions were given, the Claimants intended to call Mr Kingston to give evidence supporting the hypothesis that there may have been vendor anxiety, ignorance and pressure and, as such, it was proper to put that possibility to Mr Haines.[225]

229 It was further submitted that it is clear that Mr Haines was not told to assume these matters, only to consider them as possibilities and decide for himself. Mr Haines was advised when the Claimants decided to not call Mr Kingston and was asked to consider whether and how this affected his opinions, and his evidence was that it did not.[226]

230 The Claimants submitted that even if Mr Haines had not been given those instructions, it is apparent from his written and oral evidence that he would still have performed his 'cap and collar' comparison and assessed the 'B' values materially higher than Mr Keck, meaning that there would still have needed to be a trial on the question of the 'B' values. As such, the Claimants submitted that any unreasonableness in instructing Mr Haines has not relevantly 'affected' the proceedings or the costs incurred by the Authority.[227]

231 The Authority submitted in the Costs Hearing that the Court should infer that Mr Kingston was not called because his evidence would not have withstood careful examination, and if so, then that was always the case. As such, it was always the case that there was no evidence capable of withstanding careful examination that could support the instructions given to Mr Haines. That being so, it was not proper to instruct Mr Haines to assume positively that the matters in question either were or may have been true.[228]

232 The Authority further submitted that it is clear that had Mr Haines not been instructed in the way that he had, he would have had no reason to disregard the Permanent Trustee and Coram sales.[229]

233 The Authority also submitted that the instructions relevantly 'affected' the proceedings as, had Mr Haines not been instructed as he was, he would not have disputed the Permanent Trustee and Coram sales, and had that occurred there would have been no cause for dispute between the parties as to the 'B' value. It submitted that had that occurred, then there would have been substantial costs savings:[230]

(a) there would have been no need for Mr Haines and Mr Keck to prepare their various historical valuation reports;

(b) the conclaves between Mr Keck and Mr Haines need not have occurred;

(c) their joint reports need not have been prepared;

(d) the parties need not have prepared objections to their evidence; and

(e) the parties need not have prepared and conducted their extensive cross‑examination at trial.

234 I find that a number of the decisions and actions taken by the Claimants have unnecessarily added to the costs burden and time taken in this proceeding. There properly ought to be costs consequences. The proceedings have been adversely affected in several ways. I accept the Authority's submissions in respect of the briefing of Mr Haines. This is commented on in the Compensation Decision.[231] It is appropriate to take this part of the running of the proceedings by the Claimants into account in the overall decision as to costs as a factor against the Claimants.

235 As discussed below at [251], I also consider the very late decision not to call Mr Kingston as wasteful.

Claimants' decision to not call Mr Kingston to give evidence at trial

236 The Authority contends that the Claimants should not have decided, on the eve of trial, not to call Mr Kingston as a witness, submitting that:[232]

(a) the Court had already expressed its concerns about that decision;

(b) significant costs were thrown away by reason of the decision not to call Mr Kingston. In particular, the considerable costs associated with preparing objections to Mr Kingston's witness statements and preparing to cross‑examine Mr Kingston were wasted;

(c) as a result of the Claimants' decision not to call Mr Kingston as a witness, it became impossible for the Claimants to maintain their claims for disturbance loss and solatium, yet they reserved their position until closing submissions;[233]

(d) much of the documentary evidence on which both parties relied was exhibited to Mr Kingston's first witness statement, yet when the Claimants decided not to rely on Mr Kingston's witness statements, they reserved the right to object to the Authority relying on documents that they themselves had intended to adduce;[234] and

(e) the parties were ultimately able to reach agreement as to documentary tender,[235] but this unnecessary and time‑consuming diversion could have been avoided if the Claimants had made it clear from the outset that they did not intend to call 'potentially the closest witness' to give evidence or having filed witness statements prepared by Mr Kingston, the Claimants had gone on to call Mr Kingston to give evidence.

237 The Authority submitted at the hearing that:[236]

Perhaps more significantly, the late decision also imposed real burdens on the Authority during the trial, because it needed to determine how to deal with the significant documentary evidence that had been exhibited to Mr Kingston's first witness statement.

238 The Claimants reject the Authority's submissions that it was unreasonable for the Claimants to have decided shortly before trial not to call Mr Kingston. They submitted that not calling Mr Kingston was a 'perfectly available' and 'proper course' taken on behalf of the Claimants prior to the commencement of trial, and Mr Kingston's evidence was not in any way opened, in writing or orally. They submitted that it is orthodox, happens regularly at trials, especially where new counsel come into a matter and that serving a statement does not mean a person will or must be called.[237] The Claimants submitted that they promptly informed the Authority of the decision not to call Mr Kingston, and in time for the Authority to make a decision about whether or not to call him as its own witness.[238]

239 In support of their submission that the decision was not unreasonable, the Claimants submitted that:[239]

(a) a party has the right not to call a witness, at any stage and it is not uncommon in litigation for parties to exercise that right, even without notice to the other side (and here there was immediate notice[240]). The exercise of a legitimate forensic right cannot be described as unreasonable;

(b) since Mr Kingston was a witness who was expected to give evidence against the Authority's case, it is 'inapt' for the Authority to take issue with him not being called. It was argued that if the Authority really wished for Mr Kingston to give evidence, it could have called him as he was physically present at trial; and

(c) it is impossible to characterise the decision to be unreasonable as not calling Mr Kingston narrowed the scope of the parties' disputes and saved trial time. In oral submissions, the Claimants argued that the costs 'thrown away' due to Mr Kingston not being called are fractional when compared to the time that would have been taken in cross‑examination, submissions, and consequential matters for the valuers.[241]

240 The Claimants submit that an award of costs against the Claimants on this ground would be against trial realities and a decision of a party to reduce the issues and content for trial by dispensing with a person as a witness ought not be penalised.[242]

241 In the alternative, the Claimants submitted that even if it was unreasonable to decide not to call Mr Kingston, at most that would lead to an order for the Authority's costs thrown away in having prepared for his evidence, rather than an order that the Claimants should pay the Authority's costs of the whole of the proceedings.[243]

242 At the Costs Hearing, the Authority submitted that while it may be accepted that a party has a right not to call a witness, that does not mean that its exercise can never be unreasonable and depends on all the circumstances: here, the exercise of the right at the very eve of the hearing was unreasonable in all the circumstances. Mr Kingston was potentially the closest witness, and the only person who may have been able to provide direct evidence of the circumstances which he had alluded to in his witness statement, but then withdrew.[244]

243 The Authority drew attention to my comment at [403] of the Compensation Decision that the decision not to call Mr Kingston was 'curious' and led to the position where there was an abject absence of cogent evidence to persuade the court that the Previous Claimants were anything other than prudent, well informed, and willing but not anxious participants in the sale in question.[245]

244 The Authority also submitted that senior counsel was in fact retained in May 2023, and it 'was not as if he was briefed a few days before trial', so the decision not to call Mr Kingston cannot be explained on that basis.[246]

245 The Authority submitted that it is perfectly apt for the Authority to complain about the decision not to call Mr Kingston, as he had filed extensive material, was a key witness for all claims, and the case had been prepared on the basis he would give evidence. The Authority had to 'pivot' to determine how to deal with such a significant change in the Claimants' case.[247] It also submitted that the Court's task was made unnecessarily complex and was required to make findings by drawing inferences from contemporaneous documents.[248]

246 It further submitted that the fact that the Authority could, in theory, have called Mr Kingston does not mean that it was reasonable for the Claimants, one of whom is Mr Kingston, not to call him, particularly when that decision was made so late. If any party were to call Mr Kingston, it was clearly more appropriate for the Claimants to have done so.[249]

247 The Authority submitted that if the narrowing referred to is that the Claimants decided not to press their allegations against Mr Lawson, the Court found that the instructions to Mr Haines continued to affect, if not infect, Mr Haines' evidence. That being so, the later decision not to call Mr Kingston did not mean that that issue went away.[250]

248 The Authority urged consideration of all of the circumstances of the decision. Even if the decision saved some time in not hearing Mr Kingston's evidence, it meant that considerable work that had been done was rendered irrelevant and that considerable work had to be done in consequence, including making the court's task unnecessarily complicated and requiring the Authority to 'pivot', effectively during trial, to work out how to deal with the historical documents.[251]

249 The Authority submitted that it does not matter that the Authority was told promptly about the decision and that what matters is that the decision itself was unreasonable. It submitted that Mr Kingston was a critical witness and it was simply not reasonable for the Claimants to have waited immediately before trial to decide not to call him. The fact that the Authority was told promptly about that unreasonable decision does not transform that decision into a reasonable one.[252]

250 The Authority rejected the Claimants' submission that even if the decision was unreasonable, it should only lead to an order for costs thrown away. It reiterated that because this decision arose in the context of four other instances of unreasonable conduct, these should collectively lead the Court to conclude that it is appropriate for the Claimants to pay the Authority's costs in the Pre‑Calderbank Period.[253]

251 I find that the late decision not to call Mr Kingston to be one which was wasteful of the parties' resources in the preparation of the proceeding overall and in the preparation of the trial.

252 I accept the Authority's submissions on this aspect of the Claimants' procedural actions. I do not accept that this course was something which can be squared away as trial reality as submitted by the Claimants or that it saved time and costs. It might have reduced trial time but did not reduce costs for the parties in the preparation which related to Mr Kingston's extensive material.

253 Like the matter above in respect of the instructions to Mr Haines, I consider this to be a factor against the Claimants in the overall decision on costs.

254 The Authority submitted that the Claimants should not have increased the cost of the proceedings and the interest payable under the LAC Act by 'changing their case' for the reasons set out below.[254]

(a) The Claimants were aware from 26 March 2021, when they received the Authority's 2021 Particulars of Offer, that the Authority put in issue the effect of hydrology and contamination concerns on the value of the Acquired Land.

(b) By orders dated 30 April 2021, the Claimants were required to file and serve any expert witness statements or expert evidence upon which they proposed to rely at trial by 14 December 2021. They did not file any hydrology or contamination evidence by that date.[255] They may be taken to have made a strategic choice not to file evidence of that kind, despite being put on notice of the relevance of hydrology and contamination issues. It was elaborated by Mr Pizer in oral submissions that the Authority submits that, based on Mr Callander's affidavits, they made a strategic choice not to file any reports of that kind. Instead, they made a tactical decision to wait and see what evidence the Authority led on those questions or topics, and then determine whether that evidence warranted a reply.[256] It submitted that this is 'fundamentally at odds' with the proper functioning of this jurisdiction and that while no party bears a legal onus of proof, practically and in reality, it is the Claimants' land and it is therefore, ordinarily, the claimant who is best placed to lead evidence first in relation to matters such as the effect of the acquisition, the 'highest and best use' of the land.[257]

(c) On 29 March 2022, the Authority filed its hydrology and contamination evidence. On 6 and 20 May 2022, almost five months after the deadline for the Claimants to file their expert evidence, the Claimants changed their position and decided to produce their contamination and hydrology evidence respectively.[258]

(d) On 30 May 2022, the Court listed the proceedings for hearing commencing on 13 February 2023. However, with 'apparent disregard for the Court's timetable':

(i) on 19 October 2022, the Claimants provided two new concept plans dealing with the hypothetical development of the Acquired Land, which the Claimants said they might seek to rely on 'in addition to the plans already in evidence';[259]

(ii) on 25 and 30 November 2022, the Claimants produced nine new expert and lay statements that addressed, among other things, hydrology, new concept plans and contamination;[260] and

(iii) one of the expert statements was a report of Mr Haines that responded to a letter of instruction dated 15 June 2022, and which did not account for the Claimants' other new evidence.[261]

(e) As a result of the Claimants' 'apparent disregard for the Court's timetable' and the 'significant' change to their case:

(i) the hydrologists and civil engineers were unable to agree developable land areas at the joint conclave on 7 October 2022, because the Claimants intended to 'undertake further hydraulic modelling ... to test scenarios that optimise the developable area';[262] and

(ii) by orders dated 8 December 2022, the Court made a new timetable for expert evidence and adjourned the trial by approximately six months to 2 August 2023.[263]

(f) Following the adjournment, the Claimants went through three further rounds of changing concept plans.[264] In addition, 'notwithstanding concerns that were raised by the Court on 5 July 2023 about the risk of further adjournment',[265] on the same day those concerns were raised the Claimants instructed Mr Haines to prepare a further statement, which was served on 12 July 2023.[266] That further statement addressed concept plans that the Authority had understood were no longer being relied upon, as well as two further concept plans dated 5 July 2023.

(g) On 24 July 2023, by reason of the parties' agreement as to the market value of the Acquired Land at the date of acquisition, the issues the subject of the evidence referred to above fell away. Nonetheless:

(i) the adjournment of the trial in December 2022 increased the interest payable on the compensation awarded to the Claimants by approximately $32,405;[267] and

(ii) the burden placed on the Authority of having to repeatedly respond to the changes to the Claimants' case significantly increased the Authority's costs.[268]

(h) Lastly, in closing submissions the Claimants presented, for the first time, an 'alternative' 'B' value that:

(i) was based on the false premise that the Permanent Trustee Land was at least as valuable as the Coram Land;[269] and

(ii) in substance invited the Court to reject the evidence of all the valuers and find that the 'B' value was somewhere in the middle.[270]

(i) The Court found that the Permanent Trustee Land was not more valuable than the Coram Land and therefore rejected the Claimants' 'alternative' case, but again this required a response from the Authority that should not have been necessary.[271]

(j) By reason of the various changes to the Claimants' case, the Authority has been forced to pay additional interest (by reason of the adjournment) and has incurred significant costs. That additional interest would not have been payable, and those significant costs would not have been incurred, had the Claimants acted reasonably in pursuit of their claim for compensation.

255 These submissions are rejected by the Claimants. The Claimants submitted that both sides' cases evolved before trial, which is natural in large and complex litigation, particularly where there are no formal pleadings and there is extensive expert evidence in numerous disciplines that affects evidence in other disciplines.[272] They submitted that numerous permutations arose, and to the extent that permutations arose in one discipline, every other discipline had to grapple with these, especially the valuers.[273] They submitted that in cases like this, which are driven largely by expert evidence, a party should be driven by the expert evidence it obtains, so if an expert is asked to report on a topic and comes back with two permutations or a new approach, it is not open to the party to ignore that.[274] They submitted that the proceedings were 'inherently difficult' and that there were particular developments along the way which led to it progressing to trial as it did.[275]

256 The Claimants also submitted that it was not unreasonable for the Claimants to have filed the evidence on the 'C' values because such evidence brought about a successful result, in convincing the Authority to agree to a 'C' value of $34 million, rather than a range of materially lower figures, down to $2.3 million, as the Authority had been contending for prior to that agreement.[276]

257 The Claimants submitted that the fact of agreement on the 'C' value at $34 million in late July 2023 makes it both inapposite and unsound to seek to evaluate the parties' conduct and evidence relating to the 'C' value prior to that time.[277]

258 The Claimants also rejected the proposition that it was unreasonable to present an alternative approach to the 'B' values in closing submissions in light of the evidence which came to light and note that the Authority also pressed an alternative case in closing.[278] They submitted that this entailed no more than a discrete and limited component of the closing oral arguments.

259 The Claimants further submitted that the way the Authority prepared its own case was unsatisfactory, caused delay and increased costs and thus cannot take issue with the way the case was run by the Claimants.[279] The Claimants pointed to various examples including the Authority's delay in filing expert reports and there being certain inconsistencies with the Authority's materials.[280]

260 The Claimants submit in the alternative that even if the Claimants are seen as solely responsible for the six month adjournment of the trial, causing an extra $32,405 in interest, the trivial net loss to the Authority could not justify an order for the Claimants to pay the Authority's costs of the whole of the proceedings.[281] They also submitted that even if there was a cost in terms of interest, this was offset by the interest income by not having paid compensation earlier.[282]

261 In respect of contamination and hydrology issues, it submitted that in its 2021 Particulars of Offer the Authority, by using conditional language, did the 'reverse' of putting contamination in issue. When it came into issue, within five to six weeks of Mr Ray's reports being served in March 2022, the Claimants commissioned and served responsive evidence. They rejected that it was a strategic choice for the Claimants not to file contamination evidence by December 2021.[283]

262 They submitted that, ultimately this had no impact because reports were superseded by the Joint Memorandum of Counsel of 24 July 2023.

263 The Claimants acknowledged the delay in providing certain evidence, but noted this was not without explanation[284] and the Authority was also delayed materially in its service of evidence.[285]

264 The Claimants also argued that the Authority's evidence of Mr Milner and Ms Heggan was 'fundamentally incompatible' with each other, which led for planning experts in every discipline to look at two 'fundamentally different' permutations for that part of the Acquired Land.[286] They say this meant that the Authority decided to run two cases on planning, which were incompatible with each other and as regarding Mr Milner's evidence, incompatible with the 2021 Particulars of Offer which pleaded that the Jomaring land would have been residential and in Mr Milner's opinion, part of the Jomaring land would have been in an industrial zone.

265 The Claimants submitted that the reliance on two planners added inappropriately to cost, expense and time.[287]

266 In summary, the Claimants' position is that it does not seek a finding of unreasonable conduct (in respect of the Authority), but that there was problematic conduct by the Authority which must be considered in conjunction with the conduct of the Claimants. They submitted that rather than as a criticism of the Authority, it is reflective of the fact that the proceedings were complex, fluid and difficult[288] and it was not a matter entirely the Claimants' fault that the trial was adjourned.[289]

267 At the Costs Hearing, the Authority submitted in respect of hydrology that the Claimants' Particulars of Claim attributed a vastly lower value to that part of the land that was affected by flooding, where the rate drops from $5.5 million per hectare to $550,000 per hectare, such that the Claimants' own Particulars of Claim necessarily put in issue the question of flooding and therefore the relevance of the extent was the land affected by flooding and was developable.[290] That being so, the relevance of hydrological evidence was self‑evident when they filed their Particulars of Claim yet they did not provide any expert report dealing with hydrology until 25 November 2022, almost a year after their evidence was due.[291]

268 The Authority submitted that the Claimants knew that the extent to which the land was contaminated was relevant to its market value and knew that the Authority had raised the question of contamination before these disputes were referred to the Court.[292] The Authority referred to two examples which demonstrated that contamination was 'in the ring' and the Claimants should have led evidence about it, the first being the letter from Mr Callander to the Department of Transport, dated 14 September 2020 where Mr Callander acknowledged that the Claimants understood the proposed valuers' conference could not proceed as the Authority's valuers sought more instructions concerning contamination.[293] The second was a letter sent by Mr Callander to Mr Malcolm Robinson on 5 October 2020 which referred to the Authority's contention that part of the land is affected by surface or near surface asbestos contamination.[294]

269 The Authority also submitted that the Court had listed the proceedings for hearing in February 2023, made orders on 21 September 2022 that the joint expert process was to be completed by 25 November of that year and, by late November of that year, the conclave process was 'virtually completed'. Notwithstanding this, without leave of the Court, the Claimants then produced nine new expert and lay statements, spanning more than 300 pages of new material which addressed inter alia hydrology, new concept plans and contamination.[295]

270 This, the Authority submits, caused the Court to adjourn the February trial and make a new timetable for expert evidence. It submitted that these were 'deliberate' and 'tactical' decisions by the Claimants to withhold relevant evidence until the Authority had led its evidence.[296]

271 They also submitted that the Claimants did not maintain a consistent position in relation to the concept plans dealing with hypothetical development of the Acquired Land and went through three further rounds of changing concept plans and sought to rely upon a further concept plan of Mr Haines (including a report that addressed concept plans that the Authority had understood were no longer being relied upon) and two further concept plans dated 5 July 2023.[297] Changing the concept plans led necessarily to a lot of extra costs being incurred by the parties, and the Authority says that was not part of the ordinary course of this kind of litigation and was 'unreasonable' and 'unnatural' conduct.[298]

272 The Authority rejected the Claimants' submissions which they say effectively invite the Court to reject the evidence of all of the valuers and find that the 'B' value is somewhere in the middle between the Permanent Trustee Land and the Coram Land which, by reason of the various changes in the Claimants' case, the Authority has been forced to incur significant costs and was forced to pay a modest amount of additional interest occasioned by the adjournment.[299]

273 Rather than the case evolving naturally, the Authority submitted their conduct was not a typical or natural example of a case evolving before trial,[300] the Claimants made deliberate tactical or strategic decisions, and those decisions caused delay and increased the Authority's costs.[301]

274 The Authority emphasised that the fact that the July 2023 agreement was reached does not mean that the Authority cannot take issue with a party's prior unreasonable conduct in respect of costs.[302]

275 In respect of the alternative case put in respect of the 'B' value, the Authority submitted that if the Claimants had not compromised or tainted Mr Haines by instructing him to make the assumptions that it did, then did not seek to substantiate them, the Claimants would not have had to make a submission that the Court should reject all of the valuation evidence, and as such, was unreasonable.[303]

276 In respect of allegations that the Authority was unsatisfactory in the way it prepared its case, the Authority submitted in reply as set out below.[304]

(a) In relation to late filing of expert reports, the critical point is that the Authority had filed all of its evidence and all but one of the conclaves concluded on time in November 2022 which was before the Claimants brought their application to file nine new statements.

(b) In relation to the Authority having filed the evidence of Mr Milner, it was submitted that this evidence was sought in response to the Claimants' allegations about zoning; it was not for the Authority, responsible for public money, to disregard his evidence. This was not inappropriate conduct which affected the proceeding as the Authority never amended its 2021 Particulars of Offer, to lower its offer to reflect Mr Milner's evidence.

(c) In respect of the Authority not obtaining evidence from Melbourne Water sooner, Melbourne Water is not a party to this proceeding. It is a separate legal entity. The Authority did obtain evidence from an independent expert about what Melbourne Water would do (and got that evidence in 2022) and made repeated efforts to get that evidence directly from Melbourne Water. The material was handed over to the Claimants on the very day that it was received.

(d) In respect of the adjournment being a trivial net loss such that the Claimants' should not be required to pay the Authority's costs of the whole proceeding, the Authority submits that the focus is not on interest but the substantial additional costs incurred because of the Claimants' decision to rely on nine new statements of evidence, just two months before trial, listed for February 2023. This caused legal costs to be thrown away and duplicated.

277 In reply, the Claimants reiterated that the 2021 Particulars of Offer did not put contamination or hydrology issues 'into the ring'.[305] The Claimants submitted that Mr Callander did set out matters known to the Claimants demonstrating no contamination issues and it would be 'retrograde' and 'untenable' to put evidence in every discipline regardless of whether it was in issue, just to 'cover it off.'[306]

278 The Claimants referred to the Court's orders of 21 September 2022 which recorded in the 'other matters' the expressed intention of the Claimants to seek to put on such reports and made provision in respect of that occurring.[307]

279 The Claimants rejected the Authority's submission that the Claimants had put hydrology in issue with its own evidence served before December 2021.[308]

280 In respect of the Authority's retention of two experts, the Claimants referred to the full Federal Court decision in Novartis v Pharmacor [2022] FCAFC 58 ('Novartis') at

[25]-[30], where Justice Beach stated that a convincing reason would be needed for a second expert in one discipline to able to be relied upon. They submitted that if that were to be done, and such reason were to be shown, then before filing the reports, the reason should be established by argument before the court if not consented between the parties. They submitted that that dictum was not embracing a circumstance such as the present, where the second expert was not just duplicative, but fundamentally inconsistent.[309]

281 By way of final reply submissions, the Authority argued that Novartis was not a case involving this jurisdiction where it is not unusual for more than one expert in the same discipline to be called.[310]

282 In the preparation of the expert and lay evidence in this matter, both sides have taken steps which have made the evidence more complex and tended to extend the time to get this matter to trial. The failure to meet Court set timeframes is to be avoided and not to do so is contrary to the expectations of practitioners under the Civil Procedure Act.

283 In this regard, the 12 month delay by the Claimants in addressing hydrology and contamination evidence is regrettable. The filing of nine new statements is not a positive and efficient manner of conducting litigation. I am also concerned by the multiple concept plans which were prepared unnecessarily.

284 As against this, there were steps taken by the Authority which did not assist in bringing the matter efficiently to trial. In particular, the addition of a second town planning expert was also a regrettable step.

285 Whilst I am satisfied that the management of the proceeding by the Claimants was not exemplary, I have formed the view that this is a factor which cuts both ways to a degree. In combination with the change of instructions to Mr Haines and the decision not to call Mr Kingston, the management of the issues and evidence does amount to unreasonable conduct on the part of the Claimants. That said, there is also a degree of culpability by the Authority, as outlined above.

286 The delay which has occasioned an additional interest cost to the Authority is a significant factor, but is not one which would result in an overall costs award against the Claimants in all the circumstances. I have given it some weight in determining the overall costs allocation.

287 Section 91(1)(b)(iii) requires the Court to take into consideration, if it considers is appropriate to do so, the extent to which, in the opinion of the Court, the proceedings have arisen from, or been affected by, an excessive claim by the claimant.

288 The Authority submitted that this factor overlaps, to a large extent, with whether the proceedings arose from, or were affected by, the unreasonable conduct of the Claimants.[311] It submitted that just as it was unreasonable for the Claimants to have sought to deny the relevance of the Previous Compensation and to have instructed Mr Haines as they did, the Claimants' claims were 'grossly excessive' by reason of these matters.

289 The Authority reiterated that the Claimants sought compensation in excess of $52.7 million (plus interest and costs) but they were awarded a small fraction of that amount in compensation.[312] They submitted that the 'massive' discrepancy between what the Claimants sought, and what they were awarded, is attributable to their strategic choices of what they described as 'taking a punt' on an obviously unattractive legal argument that would have led to significant overcompensation, and briefing their expert witness in a 'skewed' and 'inappropriate' fashion.

290 The Authority submitted that these choices are aptly described as 'unreasonable or worthy of criticism' and as such, the Claimants' claim - which was based on those choices - is rightly characterised as 'excessive'.[313] The Authority submitted that the Claimants have consistently sought compensation in excess of $50 million plus interest and costs, which 'is, and has always been', excessive.[314]

291 The Authority further submitted that the difference between the compensation awarded by the Court and the compensation sought by the Claimants was so great that there was practically no room to reach a negotiated outcome. Therefore, it submitted that it was the Claimants' unreasonable conduct and the excessive claim that caused the parties to incur millions of dollars of costs in these proceedings.[315]

292 The Claimants rejected the Authority's submission that the Claimants' claim was 'excessive' because they only recovered (rounded) $2.4 million (plus interest) rather than $52.7 million as claimed.[316] The Claimants submitted that excessiveness does not arise only because a large claim fails, but requires 'blameworthy' conduct of some sort.[317]

293 While acknowledging that the dollar difference between the outcome and the position for which the Claimants were contending was 'enormous',[318] the Claimants submitted that they cannot be criticised for seeking $52.7 million upon issue, given they had valuation evidence supporting the factual claim and an 'arguable' legal case that s 41(5) of the LAC Act did not apply.[319] They submitted that to decide otherwise would have a 'chilling' effect on any claimants seeking to pursue an arguable case, supported by evidence, in the face of a compulsory dispossession by the State.[320]

294 They submitted that the fact that the amounts offered were deficient provides extremely significant context as the Claimants were forced to bring proceedings to obtain the compensation to which they were statutorily entitled.[321]

295 The Claimants referred to the Joint Memorandum of Counsel to say that there was an agreement of the parties that that value was $34 million dollars and that the 'C' value, while a strong result for the Claimants, nevertheless represented a compromise by the Claimants as against the primary scenario for which they would be contending at trial of $39.865 million.[322] This, they say, is the antithesis of conducting the proceedings unreasonably.[323]

296 The Claimants also submitted that to use the $52.7 million claim is artificial as a comparator because, by the time of the trial, the claim had been significantly reduced.[324]

297 The Claimants further submitted that:[325]

(a) the proper characterisation of the proceedings is that by the time of trial, the Authority accepted that, subject to the application of s 41(5), which turned on a number of complex legal issues, the Claimants were entitled to $34 million in compensation plus interest;

(b) in any event, the question under s 91(1)(b) is the degree to which any excessive claim has 'affected' the proceedings. They submitted that the reality is that, given the factual and legal complexity of this acquisition, there was always going to be significant disputation between the parties, about the 'B' and 'C' values, and about the application of the statutory formula, leading to a lengthy trial; and

(c) it is important to appreciate that, right up until July 2023, the Authority was pursuing a best case which would have assessed the 'C' value as $2.3 million before applying a reduction (of about 95%) for the formula, so leaving the Claimants with perhaps $115,000 market value compensation (plus expenses), as the only compensation for the compulsory acquisition of 8.09 hectares of suburban land. In such circumstances, significant litigation was all the more likely to occur, even had the Claimants' own claims been less than they were.

298 The Claimants submitted that the reason for the large gap in recovery is that neither of the two principal legal arguments for the Claimants prevailed which is not within what the legislation has intended by its use of the phrase 'excessive'.[326]

299 The Claimants submitted that they pressed the $52.7 million when this was the figure opined by Mr Haines, and that when he reduced his valuation of figures upon further input material and reflection, then the stance of the Claimants reduced accordingly.[327]

300 The Claimants also submitted that 'it was the insufficiency of the [Authority's] original offer which caused the parties to incur costs in the litigation'.[328] The Authority rejected this submission on the basis that the litigation costs arose from the Claimants' unreasonable conduct and excessive claim.[329]

301 The Authority submitted in reply that the Claimants' conduct was 'blameworthy', a characterisation the Claimants argued was required.[330] In essence, they submitted that all aspects of the Claimants' conduct in the proceeding which they contend are unreasonable, are enmeshed with and causative of the Claimants' 'excessive' claim.

302 They argued that if the Claimants had not sought to be overcompensated or 'double dipping', these proceedings would likely have settled.[331]

303 The Claimants rejected the implication that they sought to be 'double dipping', emphasising that the previous payments were not made to Mr Kingston and Jomaring, so there was not double‑dipping in the sense of overcompensation to the same claimant individuals. They submitted that, as because s 41(5) of the LAC Act says in its own terms what it does, unless s 16(b) of the ILA operates, then the legal reality is that the statute would not have prevented full compensation at the time of acquisition.[332]

304 The claim in excess of $50 million as compared to the Court's assessment of the claim superficially attracts a conclusion that the claim was manifestly excessive. Such a position is not uncommon in compulsory acquisition claims where there is a significant difference of opinion as to valuation or where, such as here a threshold legal question dramatically alters the bounds of the quantum of the claim.

305 Again, I reiterate my comments made at [130]-[131], [162]-[163], [170], [185] and [218]-[220] above. I am of the view that the threshold legal question was one which was open to be argued by the Claimants and the quantum of the claim substantially rode on the back of that question. It was a risk they were prepared to take and in my view, whilst it may be properly categorised as being somewhat speculative or ambitious, it was not so lacking in merit to be considered unreasonable. I do not consider in these circumstances that the claim was unreasonable.

306 However, the claim for solatium and for disturbance, abandoned as they were, are indicative of being excessive and unreasonable and were not substantiated. The cost of these parts of the claim should not lie at the feet of the Authority. Whilst independently these issues are a minor component of the claim overall, they remain relevant to the reasonableness of conduct considerations in s 91(10)(b)(i) rather than s 91(1)(b)(iii).

307 The Claimants seek certification from the Court that the case was appropriate for three counsel. The Court has the power to make such a certification under s 91 of the LAC Act as has been done in previous compulsory acquisition decisions.[333]

308 In support of their request, the Claimants submitted that the proceedings were complex in nature, wide in scope, involving numerous legal and valuation issues and extensive documentary and factual material.[334] Mr Callander stated in his fourth affidavit that, in his opinion and based on 54 years of experience as a solicitor, it was appropriate to engage three counsel, given the factual and legal complexity of the proceedings, the amounts in question, the valuation and other expert issues, and the large volume of documentary material and evidence over numerous specialised fields.[335] The Claimants also submitted that they generally only had one individual solicitor working on the proceedings, thus more reliance fell on counsel.[336] They also noted that the Authority retained three counsel for the proceedings.[337]

309 The Authority submitted in reply that if the Court makes any award of costs in favour of the Claimants, the Authority would not resist such certification.[338] However, if the Court makes an award of costs in favour of the Authority, the Authority seeks certification for three counsel.[339]

310 I am of the view that the matter was one which was appropriate for three counsel (on both sides) to be retained. The claim overall was a complex one, made more complex by the forensic decisions made during the course of the proceeding. However, the conduct of the trial itself was run efficiently and this was done by utilising the respective counsel to deal with various parts of the claims and the evidence in an efficient manner. I make this observation as to the appropriateness of three counsel for the assistance of the ultimate costs assessment or the Cost Court, if necessary.

311 As illustrated by the foregoing discussion, the submissions made by the parties in respect of the costs applications were extensive and detailed.

312 There is no doubt that this matter was complex. The proceeding was, however, made more extensive, complex and costly by some of the forensic decisions made during pre‑trial preparation and during the trial. The production of some of the evidence, the change of position on hydrology/contamination and planning evidence added delay, duplication and increased interest liability. A portion of the conduct which added to costs and delay is fairly sheeted home to the Claimants, though not entirely. The instructions given to Mr Haines and the role of Mr Kingston's evidence added to costs.

313 As canvassed in [94]-[104] of this decision, the principles which apply to costs in a compulsory acquisition claim are set out in s[340]91 of the LAC Act.340 The usual civil claims cost rule that 'costs follow the event' is not the starting point here. The claim is made under the LAC Act for compensation for compulsory acquisition of private land. The parties agreed, as is appropriate, that in a claim for compulsory acquisition there is a 'tilt' in favour of a dispossessed landowner. This 'tilt' is, of course, subject to the factors set out in s 91.

314 Of particular relevance and weight, I have considered the following matters to be persuasive in determining that the Claimants should recover some, but not all, of their costs on a standard basis. I consider the proceedings have been adversely affected by a number of matters properly laid at the feet of the Claimants and, accordingly, a reduction to their costs is proper in all of the circumstances. I do not consider that the circumstances however, are such that the proper exercise of discretion would lead to a reversal of the costs liability.

315 Taking into account s 91(1)(a), I consider it a positive factor in favour of the Claimants that the amount of compensation awarded to the Claimants was more (but not substantially more) than the offers made by the authority. However, as indicated at [119] above, the comparatively small margin of that amount leads me to not place too much weight on this factor overall.

316 The Claimants were justified in bringing the claim in monetary terms and pursuing it.

317 However, when consideration is given to the conduct of the Claimants in accordance with s 91(1)(b)(i) and (iii), I consider the following matters to amount to unreasonable conduct and conduct which adversely affected the incurring of costs and/or delay:

(a) the preparation of lengthy evidence of Mr Kingson, then not calling him. This evidence required a great deal of work to be undertaken by the Authority which was thrown away and reduced any basis of claims made for solatium and disturbance at the last moment;[341]

(b) late delivery of hydrology evidence;[342]

(c) the addition of nine new witness statements late in the pre‑trial preparation;[343]

(d) the manner of instruction given to Mr Haines and then the withdrawal of instructions;[344]

(e) multiple planning scenarios prepared unnecessarily;[345] and

(f) the Claimants' abandonment of their claims for solatium and disturbance.[346]

318 I also consider the Authority's Calderbank Offer is a matter relevant to s 91(1)(b)(i). In summary, as discussed at [170]-[172] above, I consider that the Authority's Calderbank Offer was clearly a more generous offer than the award of the Court. However, the numerical figure is not the only relevant factor in this consideration: my analysis of this is dealt with at [129]-[132] (stage of the proceeding), [162]-[165] (time allowed to offeree), [169]-[172] (extent of compromise), and [185]-[187] (offeree's prospects of success).

319 As noted, given the effect of the construction question on the dollar figure for compensation, it is difficult to draw the conclusion that the construction question, which was hotly contested, was not pivotal in this case. The Claimants had an alternative position which based on Mr Haines' evidence, if accepted would have delivered a higher valuation outcome. As I determined in the Compensation Decision, I ultimately did not accept Mr Haines' evidence as I found it was not only influenced by the instructions he had been given, but also not soundly based on contemporaneous comparative sales.[347]

320 The case brought by the Claimants had a significant element of speculation or ambition to it. That said, the question of the interpretation and application where compensation had been previously paid had not been subject of judicial interpretation. The stakes in terms of the possible best outcome for the Claimants was lucrative. It may well have been as a consequence of that prize that the costs said to be $1.7 million pre‑trial were incurred. As such, as discussed at [130]-[131], [162]-[163], [170], [185], [218]-[220] and [305], I am of the view that the Claimants' position on the interpretation question, albeit with a degree of ambition and speculation, was sufficiently open to the Claimants such that it was not unreasonable in the circumstances to have made it. As such, their claim was not excessive to the extent it was informed by that position. I do not feel the same in respect of the claims for solatium and disturbance for the reasons set out at [306] above, however, those matters were a relatively minor component of the claim overall.

321 Lastly, as mentioned at [282] above, I do consider that both sides took steps in these proceedings which have made evidence more complex and tended to extend the time to get this matter to trial. The failure to meet Court set timeframes is to be avoided and not to do so is contrary to the expectations of practitioners under the Civil Procedure Act. I have considered this factor in the overall allocation of costs.

322 In light of the foregoing, the Authority should be ordered to pay a reduced amount of the Claimants' costs on a standard basis to take into account the matters identified at [317] above as adverse to the proceeding, determined to be 50% of the Claimants' costs calculated on a standard basis.

323 I am satisfied that taking into account the matters set out in s 91 in particular, the amount recovered, the uniqueness and complexity of the legal argument, the changes to the Claimants' position, the change to instructions and the change in position on Mr Kingston's evidence, the competing Calderbank offers and the proper exercise of discretion as to costs supports a proportion of the Claimants' costs to be paid by the Authority. I have made the reduction to 50% of the standard costs to represent the deficiencies in the Claimants' conduct and its effect on the proceeding and to draw a fair balance in the strengths and weaknesses of the respective costs claims.

324 Accordingly, I will make orders that the Authority pay to the Claimants an amount representing 50% of the Claimants' costs calculated on a standard basis.

325 As noted at [310] of this decision, my orders will reflect that I am of the view that the matter was one which was appropriate for three counsel (on both sides) to be retained for the assistance of the ultimate costs assessment or the Cost Court, if necessary.

[1] David Ronald Kingston ('Mr Kingston' or 'Kingston') and Jomaring Pty Ltd (ACN 006 457 192) ('Jomaring'), which is a company owned by Mr Kingston of which he is the sole director and secretary.

[2] Comprising the 'Acquired Kingston Land' and the 'Acquired Jomaring Land'. See Compensation Decision, [6]-[8].

[3] I note that at the time of writing this decision, order 1 of each of these orders is subject to two applications for leave to appeal filed by each of the Claimants respectively in the Court of Appeal by way of Application for Leave to Appeal (filed 13 December 2023 in S EAPCI 2023 0136, Supreme Court of Victoria, Court of Appeal) and Application for Leave to Appeal (filed 13 December 2023 in S EAPCI 2023 0137, Supreme Court of Victoria, Court of Appeal).

[4] Kingston v Head, Transport for Victoria (S ECI 2020 04458) ('Kingston Proceeding').

[5] Jomaring v Head, Transport for Victoria (S ECI 2020 04463) ('Jomaring Proceeding').

[6] Discussed at [31]-[33] below.

[9] For the purposes of this decision, I refer to the Authority and VicRoads interchangeably as the 'Authority'.

[10] Particulars of Claim (filed 16 February 2021 in S ECI 2020 04458, Supreme Court of Victoria); Particulars of Claim (filed 16 February 2021 in S ECI 2020 04463, Supreme Court of Victoria).

[11] Particulars of Offer (filed 26 March 2021 in S ECI 2020 04458, Supreme Court of Victoria); Particulars of Offer (filed 26 March 2021 in S ECI 2020 04463, Supreme Court of Victoria)

[12] Fourth Affidavit of Thomas Donaldson Callander (filed 15 November 2023 in S ECI 2020 04458, Supreme Court of Victoria) ('Fourth Affidavit of Mr Callander'), 2 [10]. I note that by the orders of Judicial Registrar Keith made in both proceedings on 21 September 2022, evidence filed in one proceeding will stand as evidence in the other proceeding.

[13] Fourth Affidavit of Mr Callander, 2 [10].

[14] Fourth Affidavit of Mr Callander, 2 [11].

[15] Filed 10 July 2023 in S ECI 2020 04458 and S ECI 2020 04463, Supreme Court of Victoria.

[16] Exhibit to Affidavit of Thomas Donaldson Callander (filed 21 November 2023 in S ECI 2020 04458, Supreme Court of Victoria) ('Exhibit TDC‑4'), 8-10 ('Joint Memorandum of Counsel').

[17] Fourth Affidavit of Mr Callander, 3 [13].

[18] Fourth Affidavit of Mr Callander, 3 [14].

[19] Fourth Affidavit of Mr Callander, 3 [14].

[20] Fourth Affidavit of Mr Callander, 3 [15].

[21] Fourth Affidavit of Mr Callander, 3 [16].

[22] Fourth Affidavit of Mr Callander, 4 [17].

[23] Fourth Affidavit of Mr Callander, 4 [17].

[24] Fourth Affidavit of Mr Callander, 4 [18].

[25] Claimants' Outline of Submissions on Costs (filed 15 November 2023 in S ECI 2020 04458, Supreme Court of Victoria) ('Claimants' Costs Submissions'), 2 [3(b)].

[27] Fourth Affidavit of Mr Callander, 4 [19].

[28] Fourth Affidavit of Mr Callander, 5 [28].

[29] Sixth Affidavit of Kathryn Anne Howard (filed 15 November 2023 in S ECI 2020 04463, Supreme Court of Victoria) ('Sixth Affidavit of Ms Howard'), 14 [61]; Sixth Affidavit of Ms Howard, Exhibit KAH‑4 ('Exhibit KAH‑4'), 83-87.

[33] Fifth Affidavit of Thomas Donaldson Callander sworn 29 November 2023 (filed in S ECI 2020 04458, Supreme Court of Victoria) ('Fifth Affidavit of Mr Callander'), 2 [7].

[34] Fifth Affidavit of Mr Callander, 2 [7].

[35] Statement of David Ronald Kingston (filed 22 October 2021 in S ECI 2020 04458, Supreme Court of Victoria) ('First Kingston Statement'); Statement of David Ronald Kingston (filed 9 December 2022 in S ECI 2020 04458, Supreme Court of Victoria) ('Second Kingston Statement').

[37] Sixth Affidavit of Ms Howard, 5 [17].

[38] Sixth Affidavit of Ms Howard, 5 [16].

[39] Sixth Affidavit of Ms Howard, 5 [18]; Transcript of the Proceedings (Supreme Court of Victoria, S ECI 2020 04458 and S ECI 2020 04463, Quigley J, 2-17 August 2023), 107, lines 24-31 ('Transcript of the Trial').

[40] Sixth Affidavit of Ms Howard, 5 [19]; Exhibit KAH‑4, 20-4.

[41] Sixth Affidavit of Ms Howard, 5 [19]; Exhibit KAH‑4, 20-4. Permanent Trustee Land is defined in the Compensation Decision at [39].

[42] Statement of Nicholas Andrew Haines (filed 22 December 2021 in S ECI 2020 04458, Supreme Court of Victoria) ('First Haines Statement').

[43] Defined in the Compensation Decision, [22].

[44] Joint Statement of Valuation Experts (filed 16 November 2022 in S ECI 2020 04458 and S ECI 2020 04463, Supreme Court of Victoria), 3, 9.

[45] Sixth Affidavit of Ms Howard, 6 [20]. 'Follett Land' is defined in the Compensation Decision, [22].

[46] Sixth Affidavit of Ms Howard, 6 [21]; citing Transcript of the Trial, 617, line 18.

[47] Sixth Affidavit of Ms Howard, 6 [22].

[48] Sixth Affidavit of Ms Howard, 6 [23].

[49] Sixth Affidavit of Ms Howard, 6 [24].

[51] Sixth Affidavit of Ms Howard, 7 [25]; Exhibit KAH‑4, 27-9.

[52] Sixth Affidavit of Ms Howard, 7 [26].

[53] Sixth Affidavit of Ms Howard, 7 [27].

[54] Sixth Affidavit of Ms Howard, 7 [28].

[55] Joint Statement of Hydrology and Civil Engineering Experts (filed 28 October 2022 in S ECI 2020 04458 and S ECI 2020 04463, Supreme Court of Victoria).

[56] Sixth Affidavit of Ms Howard, 7 [29].

[57] Filed 11 November 2022 in S ECI 2020 04458 and S ECI 2020 04463, Supreme Court of Victoria. There is a mistake in the document header which refers to the document as the 'Joint Statement of Contamination Experts'.

[58] Sixth Affidavit of Ms Howard, 8 [30].

[59] Filed 11 November 2022 in S ECI 2020 04458 and S ECI 2020 04463, Supreme Court of Victoria.

[60] Sixth Affidavit of Ms Howard, 8 [31].

[61] Sixth Affidavit of Ms Howard, 8 [32]; Exhibit KAH‑4, 33-43.

[62] Sixth Affidavit of Ms Howard, 8 [32].

[63] Sixth Affidavit of Ms Howard, 8, [33].

[64] Sixth Affidavit of Ms Howard, 10, [35].

[66] Sixth Affidavit of Ms Howard, 10, [36].

[67] Filed 10 February 2023 in S ECI 2020 04463 and S ECI 2020 04458, Supreme Court of Victoria.

[69] Sixth Affidavit of Ms Howard, 10, [37]; Exhibit KAH‑4, 52-3.

[70] Sixth Affidavit of Ms Howard, 10, [38]; Exhibit KAH‑4, 54-6.

[71] Sixth Affidavit of Ms Howard, 10, [39]; Exhibit KAH‑4, 57-61.

[72] Sixth Affidavit of Ms Howard, 11, [40]; Exhibit KAH‑4, 62-3.

[73] Sixth Affidavit of Ms Howard, 11, [41]-[42]; Exhibit KAH‑4, 64-6.

[74] Sixth Affidavit of Ms Howard, 11, [43].

[75] Sixth Affidavit of Ms Howard, 11, [44].

[76] Sixth Affidavit of Ms Howard, 11, [45]; Exhibit KAH‑4, 67.

[77] Sixth Affidavit of Ms Howard, 11, [45].

[78] Sixth Affidavit of Ms Howard, 11, [46]; Joint Statement of Valuation Experts (NA Haines & M Willison) (filed 28 June 2023 in S ECI 2020 04463, Supreme Court of Victoria).

[79] Sixth Affidavit of Ms Howard, 11, [47]; Exhibit KAH‑4, 68-70.

[80] Sixth Affidavit of Ms Howard, 12, [48]; Statement of Expert Evidence - Nicholas Andrew Haines (filed 6 July 2023 in S ECI 2020 04458, Supreme Court of Victoria).

[81] Transcript of the Proceeding (Supreme Court of Victoria, ECI 2020 04458 and S ECI 2020 04463, Quigley J, 5 July 2023), 71-2, lines 30-31 and 1-2.

[82] Sixth Affidavit of Ms Howard, 12, [49].

[83] Sixth Affidavit of Ms Howard, 12, [50]; Exhibit KAH‑4, 72-4.

[84] Statement of Expert Evidence - Nicholas Andrew Haines (filed 13 July 2023 in S ECI 2020 04458, Supreme Court of Victoria).

[85] Sixth Affidavit of Ms Howard, 13, [51]; Exhibit KAH‑4, 75.

[86] Sixth Affidavit of Ms Howard, 13, [52]; Exhibit KAH‑4, 76-7.

[87] Sixth Affidavit of Ms Howard, 13, [53].

[88] Sixth Affidavit of Ms Howard, 13, [54].

[89] Sixth Affidavit of Ms Howard, 13, [55] citing the First Kingston Statement at [151]-[154].

[90] Sixth Affidavit of Ms Howard, 13, [56].

[91] Sixth Affidavit of Ms Howard, 13, [57].

[92] Amended Particulars of Offer (filed 30 August 2023 in S ECI 2020 04458, Supreme Court of Victoria) and Amended Particulars of Offer (filed 30 August 2023 in S ECI 2020 04463, Supreme Court of Victoria) (the 'Amended Particulars of Offer for Jomaring').

[93] Fourth Affidavit of Mr Callander, 5 [30].

[94] See Compensation Decision, [3]-[5], [75]-[96], [168]-[245]. A key point of contention between the parties in the Compensation Decision was whether previous payments made in respect of the Acquired Land in 1984 under the Town and Country Planning Act 1961 (Vic) were to be taken into account under s 41(5) of the LAC Act.

[95] See, eg, Transcript of the Proceedings (Supreme Court of Victoria, S ECI 2020 04458 and S ECI 2020 04463, Quigley J, 5 March 2024) ('Transcript of the Costs Hearing'), 3, lines 13-19.

[96] Love v Roads Corporation [2011] VSCA 434 ('Love'), [139], [147]; Secretary to the Department of Transport v Provan's Timber Pty Ltd (No 2) [2020] VSCA 258 ('Provans'), [36].

[97] Love, [147], [148]; Provans, [37].

[98] Love, [173]; Provans [38]-[41].

[99] Which was cited with approval in Provans, [39].

[100] Provans, [42] (citation omitted).

[101] Plunkett v Roads Corporation (No 2) [2019] VSC 230, [7] ('Plunkett (No 2)').

[102] Secretary to the Department of Economic Development, Jobs, Transport and Resources v Caradi Pty Ltd (No 2) [2019] VSC 61, [42] ('Caradi (No 2)').

[103] Claimants' Reply Submissions on Costs, 2 [2]; Claimants' Costs Submissions, 3 [5].

[104] Respondent's Reply Submissions on Costs, 2 [8]; Transcript of the Costs Hearing, 106, lines 17-23.

[106] Transcript of the Costs Hearing, 106-107, lines 24-31 and 1-2.

[107] Transcript of the Costs Hearing, 107, lines 2-7.

[108] See [11] above; Claimants' Outline of Submissions on Costs (filed 15 November 2023 in S ECI 2020 04458, Supreme Court of Victoria) ('Claimants' Costs Submissions'), 4 [10].

[109] Claimants' Costs Submissions, 4 [10]; Transcript of the Costs Hearing, 7, lines 21-6.

[110] Respondent's Submissions on Costs (filed 15 November 2023 in S ECI 2020 04463, Supreme Court of Victoria) ('Respondent's Costs Submissions'), 3 [9].

[111] Respondent's Reply Submissions on Costs (filed 29 November 2023 in S ECI 2020 04463, Supreme Court of Victoria) ('Respondent's Reply Submissions on Costs'), 3 [12] citing Coastal Estates Pty Ltd v Shire of Bass [1994] VicRp 13; [1994] 1 VR 210 at 213, 216, Roads Corporation v Love (No 2) [2010] VSC 154; (2010) 31 VR 551 ('Roads Corporation'), [23] and Caradi (No 2), [33], where I stated that:

In my view, consideration of the phrase 'amount (if any) offered' in s 91(1)(a) must mean an amount formally offered in the context of the regime for compensation set out in the LAC Act. It may include a clear statement proffered in terms of an offer to settle the proceedings after an initial offer, but it does not include a position statement such as that set out in the opening submissions of the Authority in this matter. In my view, the term 'offered' used in the context of the LAC Act must mean something more formal than a position statement in submissions.

[112] Claimants' Costs Submissions, 4 [12].

[113] Respondent's Reply Submissions on Costs, 3 [11]. The Claimants agreed that 'nothing really turns upon [the issue]' as both parties accept that the ultimate award exceeded that of the 12 April 2019 offer and the Authority's Particulars of Offer at Transcript of the Trial, 5, lines 18-23.

[114] Respondent's Reply Submissions on Costs, 3 [13].

[115] Respondent's Costs Submissions, 4 [10] citing Plunkett (No 2) [2019] VSC 230 at [7] (Richards J).

[116] Transcript of the Costs Hearing, 107, lines 17-23.

[117] Respondent's Reply Submissions on Costs, 4 [19]. Per [93] above, the Authority further submitted that, in the Post‑Calderbank Period, these factors, in conjunction with the Claimants' refusal of the Authority's Calderbank Offer, justify an award of indemnity costs against the Claimants.

[118] Transcript of the Costs Hearing, 107-108, lines 24-31 and 1-5.

[119] Transcript of the Costs Hearing, 8, lines 7-18.

[120] Love, [152], [155], [168].

[121] Sixth affidavit of Kathryn Howard; Exhibit KAH‑4 at 78-82.

[122] Respondent's Costs Submissions, 13 [30].

[124] Respondent's Costs Submissions, 14 [31] citing Provan, [26] citing Hazeldene's Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) [2005] VSCA 298; (2005) 13 VR 435, [25].

[125] Respondent's Costs Submissions, 14 [32].

[126] Claimants' Costs Submissions, 5-6 [16]-[17].

[127] Claimants' Costs Submissions, 5 [17].

[128] Transcript of the Costs Hearing, 51, lines 6-11.

[129] Transcript of the Costs Hearing, 51, lines 19-28.

[130] Respondent's Costs Submissions, 14 [34] referring to Secretary to the Department of Business and Innovation v Murdesk Investments Pty Ltd (No 2) [2012] VSC 586 ('Murdesk (No 2)'), [38]-[44].

[131] Transcript of the Costs Hearing, 59, lines 16-19.

[132] Namely, [162]-[163], [170], [185], [218]-[220] and [305] below.

[133] Respondent's Costs Submissions, 15 [35]-[37] citing Braye v Tarnawskyj (No 2) [2019] NSWSC 659, [21].

[134] The Authority relied on s 16(b) of the ILA in its particulars of offer, which were provided to the Claimants on 26 March 2021.

[135] Claimants' Outline of Opening Submissions (filed 31 July 2023 in S ECI 2020 04458, Supreme Court of Victoria) 24-27 [100]-[114]. The Authority notes that this document is dated 30 July 2023.

[136] Outline of Opening Submissions of the Respondent (filed 31 July 2023 in S ECI 2020 04463, Supreme Court of Victoria), 11-16 [31]-[46].

[137] Fourth Affidavit of Mr Callander, 4 [22].

[138] Transcript of the Costs Hearing, 50, lines 18-20.

[139] Transcript of the Costs Hearing, 50-1, lines 24-31 and 1.

[140] Transcript of the Costs Hearing, 65-6, lines 21-31, 1-2.

[141] Transcript of the Costs Hearing, 66, lines 7-17.

[144] Respondent's Costs Submissions, 15 [37] citing Elite, [149] (Basten JA).

[145] Claimants' Reply Submissions on Costs, 8 [34].

[146] Claimants' Reply Submissions on Costs, 8 [34].

[147] Claimants' Costs Submissions, 5 [17(b)].

[148] Fourth Affidavit of Mr Callander, 5 [24].

[149] Fourth Affidavit of Mr Callander, 5 [25].

[150] Transcript of the Costs Hearing, 53-4, lines 29-31 and 1-3.

[151] Claimants' Costs Submissions, 5 [17(b)].

[152] Respondent's Reply Submissions on Costs, 5 [24], which refers to Respondent's Costs Submissions, 14 [34] which cites Murdesk (No 2), [38]-[44].

[153] Transcript of the Costs Hearing, 61-3.

[154] Transcript of the Costs Hearing, 64, lines 5-9.

[155] Transcript of the Costs Hearing, 63, lines 18-24.

[156] Transcript of the Costs Hearing, 63, lines 25-9.

[157] Transcript of the Costs Hearing, 63-4, lines 20-31 and 1.

[158] Transcript of the Costs Hearing, 64, lines 2-5.

[159] Transcript of the Costs Hearing, 59-60, lines 31 and 1-8.

[161] Transcript of the Costs Hearing, 113-114.

[162] SSABR, [21] citing Kooee, [20] (Basten JA, with whom Giles and Tobias JJA agreed).

[163] SSABR, [23] citing A v Bird [2020] NSWSC 1680, [58].

[164] SSABR, [23] citing Kooee, [2] (Giles and Tobias JJA).

[165] Respondent's Reply Submissions on Costs, 5 [25].

[166] Transcript of the Costs Hearing, 60, lines 9-19.

[167] Transcript of the Costs Hearing, 60, lines 20-9.

[168] Respondent's Reply Submissions on Costs, 5 [25].

[169] Respondent's Costs Submissions, 15 [38] citing Elite, [149] (Basten JA).

[170] Respondent's Costs Submissions, 16 [39].

[171] Claimants' Costs Submissions, 5 [17(c)].

[172] Claimants' Costs Submissions, 5 [17(c)].

[173] Claimants' Costs Submissions, 6 [17(d)].

[174] Respondent's Costs Submissions, 16 [40].

[175] Transcript of the Costs Hearing, 64, lines 22-7.

[176] Transcript of the Costs Hearing, 64-5, lines 28-31 and 1-4.

[177] Claimants' Costs Submissions, 3 [8] citing Provans, [48] and Sunland Waterfront (BVI) Ltd v Prudentia Investments Pty Ltd (No 3) [2012] VSC 399, [81]; Atton v National Mutual Life Association of Australasia (No 2) [2007] NSWSC 348, [8].

[178] Respondent's Reply Submissions on Costs, 5 [22].

[179] [2020] VSC 881 ('Brompton Lodge (No 2)').

[180] Brompton Lodge (No 2), [27].

[181] Claimants' Costs Submissions, 6 [17(d)] (emphasis in original).

[182] Brompton Lodge (No 2), [90]-[93].

[183] Respondent's Reply Submissions on Costs, 6 [28]

[184] Brompton Lodge Pty Ltd (in administration) v Head, Transport for Victoria [2020] VSC 797 ('Brompton Lodge'), [87].

[185] Brompton Lodge Pty Ltd (in liq) v Head, Transport for Victoria [2021] VSCA 302, [87].

[186] Brompton Lodge (No 2), [27].

[187] Claimants' Reply Submissions on Costs, 7 [33].

[188] Transcript of the Costs Hearing, 65, lines 9-15.

[189] Brompton Lodge, [96], [105]-[107].

[190] See [138] above.

[191] Authority's Costs Submissions, 16 [42]; Exhibit KAH‑4, 81 (emphasis in original).

[192] In its submissions, the Authority refers to this as the Pre‑Calderbank Period and Post‑Calderbank Period respectively.

[193] Sixth Affidavit of Ms Howard, 14 [58].

[194] Transcript of the Costs Hearing, 108, lines 14-23 and 121, lines 17-24.

[195] Transcript of the Costs Hearing, 3, lines 4-12.

[196] Transcript of the Costs Hearing, 109, lines 1-15.

[197] Respondent's Costs Submissions, 12 [18].

[198] Transcript of the Costs Hearing, 6, lines 11-24.

[199] Transcript of the Costs Hearing, 121, lines 25-31.

[200] Transcript of the Costs Hearing, 45-6, lines 22-21 and 1-27.

[201] Respondent's Costs Submissions, 4 [13].

[202] Secretary to the Department of Economic Development, Jobs, Transport and Resources v Caradi Pty Ltd [2018] VSC 696, [379]; Roads Corporation v Love [2010] VSC 32; (2010) 31 VR 451, [83]; McCann v Roads Corporation [2011] VSC 96, [18]; Secretary to the Department of Business and Innovation v Murdesk Investments Pty Ltd (2012) 191 LGERA 351, [37]; Roads Corporation v Love [2013] VSC 176, [16]; Wilson v Melbourne Water [2018] VSC 555, [6].

[203] Defined in Compensation Decision, [19].

[205] See generally Thiess v Collector of Customs [2014] HCA 12; (2014) 250 CLR 664, [23]; Lacey v Attorney‑General (Qld) [2011] HCA 10; (2011) 242 CLR 573, [44].

[206] Transcript of the Costs Hearing, 68, lines 1-7.

[207] Respondent's Reply Submissions on Costs, 4 [16].

[208] Transcript of the Costs Hearing 35, lines 12-15.

[209] Claimants' Costs Submissions, 2 [5]-[6].

[210] Transcript of the Costs Hearing, 36, lines 5-15.

[211] Transcript of the Costs Hearing, 38, lines 16-24.

[212] Claimants' Costs Submissions, 2 [7].

[213] Claimants' Costs Submissions, 2 [8].

[214] Transcript of the Costs Hearing, 40, lines 7-11.

[215] Transcript of the Costs Hearing, 68, lines 15-21.

[216] Transcript of the Costs Hearing, 68, lines 22-30.

[217] Respondent's Costs Submissions, 5 [14(a)].

[218] Respondent's Costs Submissions, 5 [14(b)].

[219] Respondent's Costs Submissions, 5 [14(c)].

[220] Respondent's Costs Submissions, 7 [14(e)-(i)].

[223] Parisi v Nigro [2006] NSWCA 121, [16] (Beazley JA, Ipp and Basten JJA agreeing).

[224] Claimants' Reply Submissions on Costs, 3 [9].

[225] Claimants' Reply Submissions on Costs, 3 [10].

[226] Claimants' Reply Submissions on Costs, 3 [11].

[227] Claimants' Reply Submissions on Costs, 3 [12].

[228] Transcript of the Proceedings, 73-4, lines 28-31 and 1-5.

[229] Transcript of the Proceedings, 75, lines 10-13.

[230] Transcript of the Proceedings, 76-7, lines 12-31 and 1-3.

[231] Compensation Decision, [341]-[348], [433].

[232] Respondent's Costs Submissions, 7-8 [15].

[233] Transcript of the Trial, 104-105, 700-701; Claimants' Written Outline of Closing Submissions (filed 15 August 2023 in S ECI 2020 04458, Supreme Court of Victoria), [3].

[234] Transcript of the Trial, 106-110.

[236] Transcript of the Costs Hearing, 77, lines 24-8.

[237] Transcript of the Costs Hearing, 41, lines 11-18.

[238] Claimants' Reply Submissions on Costs, 4 [17].

[239] Claimants' Reply Submissions on Costs, 4 [13]-[16].

[240] The decision was made on the morning of 1 August 2023 and communicated by Senior Counsel to the Authority's Senior Counsel very shortly afterwards that day: Fifth Callander affidavit [7].

[241] Transcript of the Costs Hearing, 40, lines 19-25.

[242] Transcript of the Costs Hearing, 41, lines 19-24.

[243] Claimants' Reply Submissions on Costs, 4 [18]

[244] Transcript of the Costs Hearing, 78, lines 15-27.

[245] Transcript of the Costs Hearing, 78-9, lines 28-31 and 1-4.

[246] Transcript of the Costs Hearing, 79, lines 11-19.

[247] Transcript of the Costs Hearing, 79-80, lines 28-31 and 1-12.

[248] Transcript of the Costs Hearing, 80, lines 13-22.

[249] Transcript of the Costs Hearing, 80, lines 23-9.

[250] Transcript of the Costs Hearing, 81, lines 9-16.

[251] Transcript of the Costs Hearing, 81, lines 17-28.

[252] Transcript of the Costs Hearing, 82, lines 7-21.

[253] Transcript of the Costs Hearing, 82-3, lines 22-31 and 1-6.

[254] Respondent's Costs Submissions, 9-10 [16].

[255] Sixth affidavit of Ms Howard, [23].

[256] Transcript of the Costs Hearing, 83, lines 21-7.

[257] Transcript of the Costs Hearing, 83-4, lines 28-31 and 1-6.

[258] Sixth affidavit of Ms Howard, [25].

[259] Sixth affidavit of Ms Howard, [28].

[260] Sixth affidavit of Ms Howard, [33].

[261] Sixth affidavit of Ms Howard, [33].

[262] Sixth affidavit of Ms Howard, [29].

[263] Sixth affidavit of Ms Howard, [34].

[264] Sixth affidavit of Ms Howard, [36]-[44].

[265] Sixth affidavit of Kathryn Howard at [48].

[266] Sixth affidavit of Kathryn Howard at [49].

[267] Sixth affidavit of Kathryn Howard at [35].

[268] Sixth affidavit of Kathryn Howard at [58].

[269] Claimants' Written Outline of Closing Submissions at [70]-[72].

[270] Claimants' Written Outline of Closing Submissions at [70]-[72].

[271] Transcript of the Trial, 781-782.

[272] Claimants' Reply Submissions on Costs, 5 [20].

[273] Transcript of the Costs Hearing, 16, lines 18-24.

[274] Transcript of the Costs Hearing, 16-17, lines 31 and 1-9.

[275] Transcript of the Costs Hearing, 12, lines 1-3.

[276] Claimants' Reply Submissions on Costs, 5 [21].

[277] Claimants' Reply Submissions on Costs, 5 [22].

[278] Claimants' Reply Submissions on Costs, 5 [23].

[279] Claimants' Reply Submissions on Costs, 5 [24].

[280] Claimants' Reply Submissions on Costs, 5 [24(a)-(b)].

[281] Claimants' Reply Submissions on Costs, 6 [25].

[282] Transcript of the Costs Hearing, 33, lines 19-21.

[283] Transcript of the Costs Hearing, 22, lines 15-20.

[284] See Fifth Affidavit of Mr Callander, [14]-[16] and [18]-[23].

[285] Transcript of the Costs Hearing, 28, line 31.

[286] Transcript of the Costs Hearing, 30, lines 1-26; Fifth Affidavit of Mr Callander, 4 [17].

[287] Transcript of the Costs Hearing, 30, lines 27-30.

[288] Transcript of the Costs Hearing, 31, lines 22-31.

[289] Transcript of the Costs Hearing, 32, lines 3-4.

[290] Transcript of the Costs Hearing, 84, lines 15-24.

[291] Transcript of the Costs Hearing, 84, lines 25-9.

[292] Transcript of the Costs Hearing, 84-5, lines 29-31 and 1-5.

[294] Summarised in the Seventh Affidavit of Ms Howard, 5 [17(c)]; referred to by the Authority at Transcript of the Costs Hearing, 85, lines 17-28.

[295] Transcript of the Costs Hearing, 87, lines 13-24.

[296] Transcript of the Costs Hearing, 87-8, lines 25-31 and 1-14.

[297] Transcript of the Costs Hearing, 88, lines 15-30.

[298] Transcript of the Costs Hearing, 89, lines 5-11.

[299] Transcript of the Costs Hearing, 89, lines 12-29.

[300] Transcript of the Costs Hearing, 90, lines 8-15.

[301] Transcript of the Costs Hearing, 91, lines 1-9.

[302] Transcript of the Costs Hearing, 93, lines 4-23.

[303] Transcript of the Costs Hearing, 94, lines 8-14.

[304] Transcript of the Costs Hearing, 94-7.

[305] Transcript of the Costs Hearing, 118, lines 17-28.

[306] Transcript of the Costs Hearing, 118-119, lines 29-31 and 1-15.

[307] Transcript of the Costs Hearing, 119, lines 16-24.

[308] Transcript of the Costs Hearing, 120, lines 4-21.

[309] Transcript of the Costs Hearing, 121, lines 4-16.

[310] Transcript of the Costs Hearing, 122, lines 26-31.

[311] Respondent's Costs Submissions, 12 [23].

[312] Respondent's Costs Submissions, 13 [24].

[313] Respondent's Costs Submissions, 13 [25].

[314] Respondent's Reply Submissions on Costs, 4 [15].

[315] Respondent's Reply Submissions on Costs, 4 [17].

[316] Claimants' Reply Submissions on Costs, 6 [26].

[317] Claimants' Reply Submissions on Costs, 6 [27] citing Caradi, [40]-[42].

[318] Transcript of the Costs Hearing, 8, lines 22-5.

[319] Transcript of the Costs Hearing, 8, lines 25-30.

[320] Claimants' Reply Submissions on Costs, 6-7 [28].

[321] Transcript of the Costs Hearing, 10, lines 1-8.

[322] Transcript of the Costs Hearing, 14, 7-30.

[323] Transcript of the Costs Hearing, lines 17-18.

[324] Claimants' Reply Submissions on Costs, 7 [29].

[325] Claimants' Reply Submissions on Costs, 7 [30]-[32].

[326] Transcript of the Costs Hearing, 37, lines 21-26.

[327] Transcript of the Costs Hearing, 37-8, lines 27-31 and 1-9 in reference to the Respondent's Reply Submissions on Costs, [15].

[328] Claimants' Costs Submissions, 4 [10].

[329] Respondent's Reply Submissions on Costs, 3 [14].

[330] See [292] above.

[331] Transcript of the Costs Hearing, 103-104, lines 31 and 1-6.

[332] Transcript of the Costs Hearing, 116, lines 19-30.

[333] See Roads Corporation v Love [2010] VSC 581, [110]; Roads Corporation v Love (No 2) [2010] VSC 154; 31 VR 551 [62].

[334] Claimants' Costs Submissions, 6 [19].

[335] Fourth Affidavit of Mr Callander, 2-3 [11].

[336] Claimants' Costs Submissions, 6 [19].

[337] Claimants' Costs Submissions, 6 [19].

[338] Respondent's Reply Submissions on Costs, 7 [35].

[339] Respondent's Reply Submissions on Costs, 7 [35].

[340] In addition to the Civil Procedure Act 2010 (Vic).

[341] See [251]-[253] above.

[342] See [282]-[286] above.

[343] See [282]-[286] above.

[344] See [234] above.

[345] See [283] above.

[346] See [306] above.

[347] See Compensation Decision, [431]-[437].