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On 3 June 2025, judgment was entered for Beverley Ailsa Brown against Seltsam Pty Limited for $1,602,313. Seltsam filed a notice of appeal on 1 July 2025, and the appeal was set down for hearing on 7 October 2025 ([1]–[2]).

On 2 October 2025, Seltsam instructed its solicitor to withdraw the appeal. The next day, Seltsam’s solicitor confirmed that the appellant wished to discontinue and would agree to pay the respondent’s costs on a standard basis ([2]). The respondent initially consented to withdrawal on that basis, subject to payment of the award balance and interest by 17 October. Before the appellant had responded, the respondent withdrew that offer ([3]–[4]).

The parties then signed a memorandum of agreement providing that the appeal should be dismissed “by consent”. It also provided that Seltsam would pay the respondent’s costs, but that the Court would determine the basis of assessment after the exchange of evidence and submissions ([5]). The respondent sought indemnity costs; Seltsam continued to agree to standard costs ([6]).

The Court ordered Seltsam to pay the respondent’s costs of the appeal on the standard basis ([12]). The respondent therefore succeeded in obtaining an order for costs, but not the more favourable basis it sought.

Why the court decided this way

The Court began with the ordinary rules. Costs follow the event under UCPR r 681(1), and, unless a rule or court order provides otherwise, costs are assessed on the standard basis under UCPR r 702(1) ([7]). The practical question was whether the circumstances relied on by the respondent justified a different costs basis.

The respondent gave three reasons for seeking indemnity costs. First, it submitted that the appeal was unmeritorious. The Court considered it a fair inference that the appeal lacked merit because it had been dismissed by consent. But that did not decide the costs question. The Court stated that lack of merit is not, by itself, a reason for indemnity costs. It relied on the distinction between compensating a successful litigant and punishing an unsuccessful one: “costs are awarded to indemnify a successful party in litigation, not by way of punishment of an unsuccessful party” ([8]). The Court also clarified that “indemnity” in that statement describes the rationale for costs generally, not the technical basis on which costs are assessed.

Second, the respondent relied on the timing of withdrawal. The appeal was withdrawn shortly before the listed hearing, after the respondent had filed an outline and incurred costs ([9]). The Court rejected that ground as a basis for indemnity costs, applying its reasoning that costs are not imposed as punishment ([9]). The judgment does not suggest that timing or expenses can never be relevant. It holds that the circumstances advanced here did not warrant the requested departure.

Third, the respondent argued that the appeal had been pursued for the benefit of Seltsam’s business more generally, rather than only to vindicate its position in this dispute. It relied on AAI Limited v Caffrey and WorkCover Queensland v Yang [No 2], including the respondent’s personal financial circumstances ([10]). The Court did not accept that reasoning on the facts before it.

The Court distinguished AAI Limited v Caffrey because the insurer in that case ran and lost an appeal to clarify its own liability and the law’s application to future cases and insurers. This appeal, by contrast, was dismissed by consent without argument being heard ([11]). The Court also distinguished Yang: a novel, scheme-sensitive issue had been argued and decided in that case, whereas the present appeal had not proceeded to argument or determination ([12]). The asserted broader significance of Seltsam’s appeal therefore did not supply the same basis for departing from the standard approach.

The reasoning is tied to the procedural posture. The Court did not decide the appeal’s substantive merits after hearing argument, nor did it decide a novel issue with prospective significance. It applied the ordinary costs approach to the appeal as it was actually resolved.

Before and after state of the law

The judgment describes the starting point as the general costs rules in Queensland. Under UCPR r 681(1), costs follow the event. Under r 702(1), costs are assessed on the standard basis unless the rules or a court order provide otherwise ([7]). The Court used those provisions as the basis for its decision.

The judgment does not announce a new test for indemnity costs or set out a comprehensive catalogue of circumstances that may justify them. Its more limited contribution is an application of the ordinary rules to an appeal withdrawn and dismissed by consent. It confirms that, in the circumstances before the Court, three features did not establish a basis for indemnity costs: the appeal’s inferred lack of merit, withdrawal close to the hearing after costs had been incurred, and an alleged broader business benefit ([8]–[12]).

The Court’s explanation also cautions against treating the word “indemnity” as if it automatically meant indemnity-basis assessment. In paragraph 8, the Court explains that the principle that costs indemnify a successful party concerns the rationale for awarding costs, not the technical basis on which the costs assessor assesses them.

As to what changed after the judgment, the source supplied records the order in this appeal only. It does not provide subsequent decisions or legislative changes. Accordingly, no claim about later developments in Queensland costs law can be drawn from this judgment alone. The decision is best read as a fact-specific application of the rules and authorities it identifies, rather than as a statement that broader-benefit arguments can never be relevant.

Key passages with plain-English translation

At paragraph 7, the Court states that costs “follow the event” and that costs are ordinarily assessed on the standard basis. In plain English, the successful party will ordinarily receive an order for costs, and the default assessment basis is standard unless a rule or order provides otherwise. Here, the parties had already agreed that the appellant would pay costs; the dispute was whether the assessment should be standard or indemnity.

At paragraph 8, the Court says an unmeritorious appeal does not automatically justify indemnity costs. The reason is that costs are compensatory rather than punitive. In plain English, the costs order is not intended to punish a party simply because its case was weak or unsuccessful. The Court considered the appeal’s dismissal by consent a fair basis to infer that it was unmeritorious, but did not treat that inference as enough to grant indemnity costs.

At paragraph 9, the Court rejects the respondent’s reliance on the appeal being withdrawn close to the hearing after costs had been incurred. In plain English, the timing and expense described in the submissions did not, in this case, turn the costs order into a punishment.

At paragraph 11, the Court explains why AAI Limited v Caffrey did not govern the outcome. There, the insurer ran and lost its appeal, which was pursued to clarify liability and the law for future cases. Here, the appeal ended by consent without argument. The distinction is about what the court was asked to decide and what it actually decided.

At paragraph 12, the Court says that in Yang a novel, scheme-sensitive issue was argued and decided. It then concludes that the general rule should apply to this appeal. In plain English, the broader significance of an issue may be relevant in a case where the court actually hears and decides that issue, but the Court did not consider the cited example a basis for indemnity costs where this appeal ended by consent without argument.

What fact patterns trigger this precedent

The decision is most directly relevant to a costs dispute with this combination of features: an appeal is dismissed by consent; the parties agree that costs will be paid but leave the assessment basis to the court; and the respondent seeks indemnity costs based on the appeal’s alleged lack of merit, late withdrawal, expenses already incurred, or broader benefit to the appellant’s business ([5]–[12]).

The decision is particularly useful when comparing an appeal that was argued and decided with one that was discontinued before a hearing on the merits. The Court’s treatment of AAI Limited v Caffrey and Yang shows that the fact those cases involved broader or prospective significance did not make them equivalent. In each cited example, an appeal or issue was argued and decided; in Seltsam, the appeal was dismissed by consent without argument ([11]–[12]).

The judgment should not be read as establishing that the timing of discontinuance, the costs already incurred, or the broader purpose of litigation are irrelevant in every costs dispute. The Court rejected those submissions as sufficient in the circumstances of this appeal. Its reasoning does not set out a complete test for every application for indemnity costs, and the supplied text does not address other possible grounds or different procedural settings.

How later courts have treated it

The judgment itself does not identify any later cases that considered or applied Seltsam Pty Limited v Brown. Because the decision was delivered on 2 December 2025 and the supplied source contains no subsequent case history, later judicial treatment cannot be described on this material.

The judgment does identify three authorities relevant to its own reasoning. It cites Oshlack v Richmond River Council for the statement that costs serve an indemnifying, rather than punitive, purpose ([8]). It distinguishes AAI Limited v Caffrey because the appeal there was run and lost to clarify liability and law for future cases, whereas the present appeal was dismissed by consent ([11]). It also contrasts WorkCover Queensland v Yang [No 2], where a novel, scheme-sensitive issue was argued and decided ([12]).

Those are relationships made by the Court in this decision. They do not establish how later courts have treated Seltsam itself. Any assessment of subsequent consideration would require later decisions not included in the supplied judgment.

Still-open questions

The judgment resolves the costs basis for this appeal but leaves several questions unanswered in the text provided. It does not state a general test for when indemnity costs are appropriate. It identifies reasons advanced in this application and explains why they were insufficient, but does not determine how different facts might affect the analysis.

The Court does not decide whether the broader business purpose alleged by the respondent would have mattered if the appeal had proceeded to argument and resulted in a judgment. It distinguishes the present case from AAI Limited v Caffrey and Yang because those matters involved issues actually argued and decided ([11]–[12]). The judgment does not say that an appeal pursued for a wider purpose will always justify indemnity costs, even if fully argued.

Nor does the decision explain how the respondent’s financial circumstances affected the costs assessment. The respondent relied on being an impecunious individual and the gap between standard and indemnity costs ([10]), but the Court rejected the broader submission by distinguishing the cited cases and applying the general rule. It does not provide a separate analysis of financial hardship.

Finally, the judgment does not explain what weight might be given in another case to a withdrawal made close to a hearing, particularly where the parties have not agreed on the costs outcome. Here, the Court considered the stated timing and incurred costs, but found them insufficient to justify indemnity costs ([9]). The decision’s boundary is therefore the particular combination of an agreed dismissal, unresolved costs basis, and no argument being heard on the appeal.

This is general legal information, not legal advice. Zoe can make mistakes. Before acting on or relying on this analysis, have a qualified Australian lawyer check it.