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[2026] NSWCA 112
procedural. There be no order as to the costs of the appeal or the costs application, with each party to bear its own costs.
No linked legislation citations have been extracted yet.
The Court had already dismissed the appeal, but the parties disagreed about who should pay the appeal costs. The Commonwealth’s successful point had been raised late, after it had previously treated the relevant trial finding as correct. Because that late point was the principal reason the appeal failed and contributed to the hearing taking an extra day, the Court considered that the parties should each pay their own costs. It made the same costs outcome for the separate costs application.
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2,240 words · generated 07/10/2026
The decision concerns costs following an earlier appeal judgment, not the underlying dispute about the condition of the land. The earlier appeal was brought by The Trust Company Ltd and Qube Re Services Pty Ltd, described in these reasons as the Developer. The respondent was the Commonwealth, described as Defence.
The appeal had been set down for two days, 4 and 5 March 2026, but required a third hearing day on 18 March 2026. On 21 May 2026, the Court dismissed the appeal in The Trust Company Ltd v Commonwealth of Australia [2026] NSWCA 90 ([1]). The Court’s earlier reasons said that the Developer had received the benefit of a Site Audit Statement certifying the land as suitable for commercial or industrial use, subject to compliance with an Environmental Management Plan. The Court concluded that the relevant covenant did not require Defence to return the land in pristine condition ([1], quoting the earlier reasons at [159]-[161]).
The present judgment addresses only the outstanding question of costs. The parties made written submissions in June 2026 ([2]). The Developer sought no order as to appeal costs, relying in particular on the late amended notice of contention that had proved decisive. Defence proposed that it pay the Developer’s costs of attending the third hearing day, while the Developer paid 80 per cent of Defence’s appeal costs ([3]-[4]).
The Court ordered no order as to costs of either the appeal or the costs application. It made clear that the intention was for each party to bear its own costs ([19]-[20]).
The Court focused on the reason the appeal was dismissed. It said its earlier reasons had addressed the parties’ cascade of issues in a logical order, different from the order in which the parties had presented them. In particular, dismissal of the appeal was “in large measure a consequence of Defence’s belated notice of contention” ([6]).
The significance of the notice of contention was that it challenged a conclusion in the trial judge’s reasons about the extent of Defence’s remediation obligation. At paragraph 393, the trial judge had concluded that Defence needed to ensure there were no asbestos fragments on the ground’s surface. The Court of Appeal rejected that conclusion in its earlier judgment, holding instead that obtaining a Site Audit Statement certifying that the land was suitable for commercial or industrial use discharged the relevant remediation obligation ([7]-[8]).
The Commonwealth had not consistently challenged the trial finding during the appeal. The Developer’s costs submissions said that the Commonwealth’s original position, in written submissions, was that the trial judge’s finding at paragraph 393 was correct. The Developer also said that its own appeal grounds had put that finding in issue. The amended notice of contention, by contrast, squarely challenged the finding only later in the hearing ([9]-[10]). The Court noted that Defence did not respond to this part of the Developer’s submissions and accepted their “gravamen” ([11]-[12]).
The Court then considered Defence’s objections. First, Defence submitted that the Developer’s grounds had not succeeded. The Court qualified that position: ground 12 had succeeded, although it was unopposed, occupied little time and did not affect the result. Some other grounds were left undecided. More importantly, the Court said that the principal reason the Developer’s grounds failed was that the amended notice of contention succeeded ([14]).
Second, Defence argued that factors other than the amendment had contributed to the third hearing day. The Court gave that submission little weight. It observed that the Developer’s senior counsel had concluded submissions shortly after lunch on the first day, while Defence’s oral submissions on grounds that failed or were not dispositive, together with the late amendment, contributed to the hearing’s extension ([16]). The Court acknowledged Defence’s point that the first two grounds in its notice of contention had occupied little time ([16]).
Third, Defence pointed out that much of the third day had been taken up by submissions in reply rather than submissions on the amended notice. The Court accepted that this was true, but found that it did not substantially undermine the Developer’s argument ([17]-[18]).
The Court compared the circumstances with Miller v Miller and Rockcote Enterprises Pty Ltd v FS Architects Pty Ltd. It noted that those cases involved comparable conduct where a successful party paid the unsuccessful party’s costs because its success resulted from a point raised late. The Court distinguished the present case in one respect: the successful point had not been omitted at trial. However, after losing on the point at trial, Defence had conducted the appeal until the second day on the basis that the point had been correctly decided, and then challenged it belatedly. That challenge was the principal basis of its success ([18]).
The Court’s conclusion was specific to those circumstances. It did not order Defence to pay the Developer’s costs, nor did it adopt the proposed percentage split. Instead, it ordered that each side bear its own costs ([19]).
The Commonwealth also relied on an open offer concerning costs. The offer proposed payment of the Developer’s costs for the third day, with the Developer otherwise paying 80 per cent of the Commonwealth’s appeal costs. The Court held that Defence had not achieved an outcome more favourable than the offer, so it did not affect the exercise of the costs discretion. For the costs application itself, the Court considered it inappropriate to impose the costs of resolving the issue on either party, even though it had largely accepted the Developer’s submissions ([20]).
The judgment does not purport to change a general rule about costs or to formulate a new test. It applies the Court’s costs discretion to the procedural history of this appeal. The reasons focus on the timing and effect of the amended notice of contention, the Commonwealth’s earlier position, and the way the appeal hearing extended ([12]-[19]).
Before this decision, the appeal judgment had already determined the substantive appeal. The costs question remained open because the earlier reasons expressly allowed the parties to be heard about costs and identified possible approaches, including an order for the costs of the third day or no order as to costs ([1], quoting the earlier judgment at [161]). The present reasons resolve that reserved issue.
The Court referred to Miller v Miller and Rockcote Enterprises as examples of comparable cases in which a successful party may bear the unsuccessful party’s costs where success results from a belatedly raised point ([18]). The Court did not set out a comprehensive account of those decisions or state that their circumstances were identical. It expressly noted a difference: in those cases, the point had not been taken at trial, whereas here Defence had lost on the point at trial but had conducted much of the appeal on the basis that the trial judge was correct ([18]).
The practical lesson from this decision is limited to the reasoning it gives: in deciding costs, the Court considered not only which party formally succeeded, but also how that success was obtained and when the decisive point was advanced. The judgment does not say that late reliance on a point will invariably result in no order or an adverse costs order. Its conclusion depended on the particular history recorded in these reasons.
At [5], the Court stated: “It is generally not appropriate to determine issues left unresolved in the appeal in order to exercise a costs discretion.” In plain English, the Court ordinarily decides costs using the issues already resolved, rather than reopening or deciding appeal grounds that were left undecided just to work out who should pay costs. The Court also recorded that neither side asked it to determine the unresolved grounds ([5]).
At [12], the Court said it accepted “the gravamen” of the Developer’s submission. That means it accepted the substance of the argument: the decisive point had been raised late, after the Commonwealth had earlier treated the trial finding as correct, and this supported the Developer’s request for no order as to costs.
At [15], the Court recorded that the amended notice “could not be addressed in the time originally allocated” and that Defence had not supplied it until halfway through the second day. This connects the timing of the amendment with the additional hearing time.
At [18], the Court described the appeal as dismissed “by reason of a belated reliance” on the amended notice of contention. It also explained the comparison with Miller and Rockcote: the point had not been omitted at trial in this case, but Defence had earlier proceeded in the appeal on the footing that the trial judge’s conclusion was correct, before challenging it late.
At [19], the Court stated the operative result: “the appropriate order is that there be no order as to the costs of the appeal.” This was not a finding that one side had won the costs issue in the usual sense. The intended effect was that each party paid its own costs.
At [20], the Court dealt with the separate costs application. It concluded that the offer did not affect the discretion because Defence had not achieved a more favourable outcome than the offer, and that each party should bear its own costs of the costs process.
The judgment is relevant to costs disputes where the formal outcome of an appeal does not tell the whole story of how the outcome was achieved. The features the Court treated as significant here were:
The decision does not establish that every late amendment warrants a no-costs order. In this case, the Court weighed the amendment’s timing and importance alongside other matters, including the arguments made during the third day, the unresolved grounds, and the parties’ respective submissions. It ultimately chose an order under which neither side recovered costs.
The supplied judgment contains no information about decisions issued after 18 June 2026 that have considered or applied this costs ruling. It is therefore not possible, from this judgment alone, to say how later courts have treated it.
The authorities discussed in this decision are Miller v Miller (1978) 141 CLR 269; [1978] HCA 44 and Rockcote Enterprises Pty Ltd v FS Architects Pty Ltd [2008] NSWCA 39. The Court referred to them as comparable examples concerning costs where a successful party’s success resulted from a belatedly raised point ([18]). It also identified a factual distinction between those cases and this one: here, the point had been taken and lost at trial, but was not challenged during the earlier part of the appeal ([18]).
The earlier decision in the same litigation, The Trust Company Ltd v Commonwealth of Australia [2026] NSWCA 90, is the judgment whose costs issue was being resolved. The present reasons recount its substantive conclusion and explain that the earlier judgment had left costs for later determination ([1]-[2]). No broader subsequent treatment can be established from the supplied text.
The judgment leaves several matters outside its determination. First, the Court did not determine appeal grounds that had been left unresolved. It said that deciding such issues solely to exercise the costs discretion was generally inappropriate, and neither party invited it to do so ([5]).
Second, the reasons do not specify a general threshold for when a late notice of contention, amendment or other point should affect costs. They explain why the timing and significance of this amendment mattered in this appeal, but do not state that the same result follows in every case ([15]-[19]).
Third, the Court did not decide whether another costs order could have been appropriate on different facts. The earlier judgment had mentioned possible alternatives, including an order concerning the third day or an allocation of part of the parties’ costs. The present reasons instead concluded that no order was appropriate in light of all the circumstances ([1], [19]).
Fourth, the reasons do not explain in detail the legal principles in Miller or Rockcote, beyond identifying them as comparable cases involving belatedly raised points and costs consequences for a successful party ([18]). Any fuller account of those authorities would need to be grounded in their own judgments.
Finally, the Court’s ruling on the open offer is confined to the offer and outcome described in paragraph 20. The reasons do not provide a general treatment of offer-related costs rules. They state only that this offer did not affect the discretion because Defence had not obtained a more favourable outcome than the offer ([20]).
This is general legal information based on the supplied judgment, not legal advice. Zoe can make mistakes. Before acting on it or relying on it, have a qualified Australian lawyer check it.
Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: The Trust Company Ltd v Commonwealth of Australia (No 2) [2026] NSWCA 112
Hearing dates: On the papers
Decision date: 18 June 2026
Before: Leeming JA; Free JA; Griffiths AJA
Decision: There be no order as to the costs of the appeal or the application for costs orders, with the intention that each party bear its own costs.
Catchwords: COSTS – appeal and notice of contention raising many points – appeal dismissed principally on basis of amended notice of contention raised on second day of hearing – respondent had hitherto accepted belatedly challenged aspect of reasons of trial judge – other grounds advanced by respondent failed – common ground that Court should depart from the usual order as to costs – appropriate that there be no order as to costs with intention that parties bear their own costs
Cases Cited: Miller v Miller (1978) 141 CLR 269; [1978] HCA 44
Rockcote Enterprises Pty Ltd v FS Architects Pty Ltd [2008] NSWCA 39
The Trust Company Ltd v Commonwealth of Australia [2026] NSWCA 90
Category: Costs
Parties: The Trust Company Ltd ACN 004 027 749 (First Appellant)
Qube Re Services Pty Ltd ACN 158 015 877 (Second Appellant)
Commonwealth of Australia (Respondent)
Representation: Counsel:
G Farland (Appellants)
J Steele SC / S Puttick (Respondent)
Solicitors:
Pinsent Masons (Appellants)
Clayton Utz (Respondent)
File Number(s): 2025/00234952
Publication restriction: Nil
159 For those reasons, which depart from those given by the primary judge, the appeal should be dismissed.
160 That result reflects the fact that although when Defence surrendered the Land, there continued to be asbestos, including on the surface or within 10cm of the surface, the covenants on which the Developer sued were not expressed in absolute terms. The principal covenant (cl 17.2) required Defence to “remediate the Land to a standard suitable for on-going commercial/industrial use”. The Developer obtained the benefit of a Site Audit Statement certifying that the Land was suitable for commercial/industrial use, albeit subject to compliance with an Environmental Management Plan. True it is that the asbestos on the Land caused the incurring of costs which would not have been incurred had the Land been pristine. But Defence was not obliged to return the Land in pristine condition. Nor did the covenant to return the Premises “clean and in good repair and condition” impose any additional obligation concerning remediating the Land.
161 The orders I propose will permit the parties to be heard as to costs of the appeal. There is good reason to depart from the usual order as to costs, in particular having regard to the facts that the appeal extended into a third day because of the belatedly amended notice of contention which, as it turns out, was dispositive. One possible exercise of the discretion as to costs would be an order that Defence pay the Developer’s costs of the third day of the appeal, and (having regard to the parties’ mixed success), an order that otherwise the Developer pay a fraction of the Commonwealth’s costs. Another possibility would be to determine that, bearing in mind all of the considerations relevant to costs, there be no order as to the costs of the appeal, with the intention that each side bears its own costs. The parties are entitled to be heard as to costs if they are unable to reach agreement, and the orders I propose will permit that to occur.
The parties exchanged submissions dated 4, 10 and 11 June 2026. These reasons resolve the outstanding issue as to costs. They use the same abbreviations as, and assume familiarity with, this Court’s earlier judgment.
The Developer’s primary submission is that there be no order as to costs, because (a) the Commonwealth’s late notice of contention was determinative, (b) because sufficient parts of the Developer’s case were left undetermined, (c) because the matters raised in the late notice of contention had not previously been raised in the Commonwealth’s submissions, and (d) generally the parties’ mixed success.
Defence submitted that it should pay the Developer’s costs of attendance at the third day of the appeal, but that otherwise the Developer should pay 80% of the Commonwealth’s costs of the appeal. It said that (a) none of the Developer’s submissions were successful, although grounds 1-5 were not determined, (b) the amended notice of contention was not the only matter which required the appeal to go into a third day, (c) the factual issues on its unamended notice of contention occupied little time, and (d) on the third day much of the argument was taken up with submissions in reply, rather than submissions on the amended notice of contention.
It is generally not appropriate to determine issues left unresolved in the appeal in order to exercise a costs discretion. Neither party invited this Court to do so. Attention then needs to be focussed on what was determined.
The Court’s reasons approached the cascade of issues presented by the parties in a logical manner. That was a very different order from that adopted by the parties, especially by Defence. It is to be borne in mind that the outcome that the appeal was dismissed was in large measure a consequence of Defence’s belated notice of contention.
The Developer’s submissions emphasised [393] of the reasons of the primary judge. There her Honour said:
Whether regard is had to NEPM (1999) or NEPM (2013), the commonly expressed position was that there should be no asbestos on the surface of soils. Having asbestos on the surface of soil also strikes me as inconsistent with the “on-going” commercial / industrial use of the site. How can employees use the site where there is asbestos on the ground, given the infamous potential for interaction with that substance to have profoundly adverse health consequences? I consider that it was Defence’s remediation obligation, so far as asbestos was concerned, to ensure that there was no AC fragments on the surface of the ground. Defence also needed to warn those using the site of the potential presence of asbestos beneath the surface, in the event that it was necessary to disturb the surface of the soils. Defence attended to the latter as I have endeavoured to describe.
This Court dismissed the appeal on the basis that that finding was wrong, and instead, the remediation obligation upon Defence was discharged by obtaining a Site Audit Statement which certified that the Land was suitable for commercial/industrial use.
The Commonwealth failed on its challenge to primary facts (on its unamended notice of contention), but succeeded on its belatedly amended notice of contention. It was by the amended notice of contention that Defence challenged, for the first time in this Court, the conclusion reached by the primary judge in [393] concerning the extent of its obligation to remediate.
In its written submissions in support of there being no order as to costs, the Developer said:
8a. In its written submissions in chief on its original Notice of Contention, at [23] the respondent had taken the position that the finding in PJ[393] was in fact correct, noting “Instead, its obligation was limited to removing surface asbestos, if any, by the Surrender Date: see PJ[393] (RED1/6/147) and [396]”.
b. The respondent’s submissions in chief maintained the same position as in its Notice of Contention submissions, namely that the finding at PJ[393] was correct.
c. In response, the appellants submitted:
“consideration of the Respondent’s Notice of Contention is an arid exercise in the face of (among other things) the conclusion by the primary judge (at J393) that there was a need to warn of the presence of asbestos because of the “potential presence of asbestos beneath the surface.”
9. In contrast, the correctness of PJ[393] was squarely put in issue by the appellants. That paragraph included critical findings by the primary judge which were the subject of multiple appeal grounds and specifically grounds 8 and 9. Although unsuccessful, that lack of success was based on the Court’s conclusion that clause 17.2 could be satisfied by certification by an auditor that “could be conditional or unconditional”. That was dispositive of the appeal (so far as cl 17.2 was concerned), and not dependent on other arguments of the parties. That conclusion depended on “the belatedly amended notice of contention which, as it turns out, was dispositive”, as Leeming JA concluded.
10. That late amended Notice of Contention was a complete reversal of the respondent’s position as articulated in its written submissions, as well as in its oral submissions, until questioned by the Court, as noted above. That change of position ought not be encouraged or rewarded by a costs order in the respondent’s favour. To do so would be unfair to the appellants, having argued their appeal up to that point, on the clear basis there was no challenge by the respondent to PJ [393].
11. As such, the respondent, by its late amended Notice of Contention, can be compared to an appellant who has succeeded on a ground “only added with the Court’s leave when the hearing commenced”, who would be ordered to pay the unsuccessful party’s costs. That being said, and although the appellants did not ultimately succeed, there are a number of factors that are relevant, as explained below, including:
a. the respondent was unsuccessful on its original Notice of Contention;
b. [t]he [C]ourt did not decide any of the grounds dealing with the Deed of Surrender, with Leeming JA noting, among other things, that determining those grounds would not affect the appeal’s outcome.
This Court’s directions gave Defence an opportunity to respond to the submissions on costs made by the Developer. No response was made to the submission reproduced above.
We accept the gravamen of the Developer’s submission reproduced above, which was not challenged in terms by Defence. That submission supports the Developer’s primary submission that there be no order as to costs.
Dealing with the submissions which were advanced on behalf of Defence, they were threefold.
The first was that most of the parties’ submissions were directed to the grounds of appeal. It is said that none were successful. That is not quite true, because ground 12 succeeded (although it was unopposed and occupied scant time and did not affect the outcome). More relevantly, as Defence fairly acknowledged, a number of the grounds of appeal were not determined. However, the principal reason the Developer’s grounds failed is that the amended notice of contention succeeded.
The belated amended notice of contention, which is the foundation of such success as Defence achieved, could not be addressed in the time originally allocated. That came about because Defence did not supply it until half way through the second day of the hearing.
The second submission made by Defence was that there were other matters which caused the appeal to extend into a third day. We do not think this carries any great weight. Senior counsel for the Developer was concise and focussed in his submissions, which concluded shortly after lunch on the first day (page 41 of a 61 page transcript). It was Defence’s oral submissions on grounds on which it either failed or which were not dispositive, and Defence’s failure to provide an amended notice of contention any earlier than it did which caused the hearing to extend into a third day. Defence added that the first two grounds of its notice of contention occupied very little time. As much may be acknowledged.
Defence’s third submission was that much of the third hearing day was occupied by submissions in reply, rather than the amended notice of contention. That is also true.
However, none of Defence’s submissions substantially undermines the points made by the Developer. In substance, the appeal was dismissed by reason of a belated reliance on an amended notice of contention, raised midway through the second day, causing the appeal to extend into a third day. There are examples of comparable conduct which result in an exercise of the discretion as to costs where the successful party pays the whole of the unsuccessful party’s costs, where that success is a product of the belatedly raised point: Miller v Miller (1978) 141 CLR 269; [1978] HCA 44. Unlike Miller v Miller and similar cases such as Rockcote Enterprises Pty Ltd v FS Architects Pty Ltd [2008] NSWCA 39, the present is not a case where the point was not taken at trial. However, having lost on the point at trial, Defence conducted the entirety of the appeal until the second day on the basis that that point was correctly decided, and only belatedly challenged it, which belated challenge was the principal basis of its ultimate success.
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The Trust Company Ltd
Commonwealth of Australia (No 2)
There be no order as to the costs of the appeal or the costs application, with each party to bear its own costs.
In those circumstances, we think that the appropriate order is that there be no order as to the costs of the appeal.
Defence separately sought a special order as to the costs of the costs application, based on an open offer that it pay the Developer’s costs of the third day, but the Developer should otherwise pay 80% of the costs of the appeal. For the reasons given above, Defence has not achieved an outcome more favourable than that described in the offer. As such, the offer does not affect the exercise of the discretion as to costs. The appropriate outcome on the costs of the costs application itself is that each party should bear its own costs. This is consistent with the determination of the costs issue more broadly. It was necessary for costs to be resolved separately following judgment and it is not appropriate to visit the costs of that process on either party, notwithstanding that the Court has largely accepted the Developer's submissions.