CLONE PTY LTD v PLAYERS PTY LTD (No 16) [2026] SASC 96

Applicant: CLONE PTY LTD Counsel: MR B ROBERTS KC - Solicitor: FINLAYSONS Respondents 1, 7, 8 and 10: PLAYERS PTY LTD, GREGORY MICHAEL GRIFFIN, DARREN JOHN CAHILL, CHRISTOPHER STEPHEN MCDERMOTT Counsel: MR P ZAPPIA KC - Solicitor: GRIFFINS LAWYERS Hearing Date/s: 11/02/2026 File No/s: SCCIV-04-319 B SUPREME COURT OF SOUTH AUSTRALIA (Civil) DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment. The onus remains on any person using material in the judgment to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court in which it was generated. CLONE PTY LTD v PLAYERS PTY LTD (No 16) [2026] SASC 96 Reasons of the Honourable Auxiliary Associate Justice Norman 23 June 2026 PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - INTERLOCUTORY PROCEEDINGS - TAXATION AND OTHER FORMS OF ASSESSMENT, AND PAYMENT PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - COSTS - INTEREST ON COSTS APPLICATION FOR INTEREST ON THE APPLICANT’S COSTS - CONSIDERATION AS TO THE PRINCIPLES RELATING TO THE AWARD OF INTEREST ON COSTS - EFFECTIVE COSTS OFFERS - RULINGS AS TO INTEREST Supreme Court Act 1935 (SA) s 30C and 114; Evidence Act 1929 (SA) s 67(2); Supreme Court Civil Rules 2006 (SA) rr 3, 12, 117, 187, 188, 271, 273 [ceased]; District Court Civil Rules 2006 (SA) r 187(2)(b) [ceased]; District Court Rules 1992 (SA) r 101.16(l) [ceased], referred to. Clone Pty Ltd v Players Pty Ltd (No 3) [2020] SASC 29; Clone Pty Ltd v Players Pty Ltd (No 4) [2022] SASC 51; Clone Pty Ltd v Players Pty Ltd (No 8) [2023] SASC 160; Clone Pty Ltd v Players Pty Ltd (No 10) [2024] SASC 72; Clone Pty Ltd v Players Pty Ltd (No 13) [2025] SASC 49; Clone Pty Ltd v Players Pty Ltd (No 14) [2025] SASC 109; Clone Pty Ltd v Players Pty Ltd (No 15) [2025] SASC 173; Batchelor v Burke (1981) 148 CLR 448; Crisp & Gunn Co-Operative Ltd v Hobart Corporation (1963) 110 CLR 538; Dajak v Riebe [1985] VR 57; S, DJ v Channel Seven Adelaide Pty Ltd & Anor (2001) 97 SASR 118; Duke Group Ltd (in liq) v Pilmer (1998) 27 ACSR 1; Heather v Vita Pacific Ltd (1996) 6 Tas R 120; Henderson v Simon Engineering Australia Pty Ltd [1988] VR 77; Hunt v R M Douglas (Roofing) Ltd [1990] 1 AC 398; Jones v Associated Newspapers Ltd [2008] 1 All ER 240; Lushington v SGIC (No 2) (1993) 168 LSJS 467; M.T. Associates Pty Ltd v Aqua-Max Pty Ltd & Anor (No 3) [2000] VSC 163; Messiter v Hutchinson (1987) 10 NSWLR 525; Minister Administering the Environmental Planning and Assessment Act 1979 v Carson 35 NSWLR 342; MBP (SA) Pty Ltd v Gojic (1991) 171 CLR 657; Nominal Defendant v Dighton (No 2) [2012] SASFC -- 1 of 84 -- 97; Pirotta v Citibank (1998) 72 SASR 259; Re Pritchard (deceased) [1963] 1 Ch 502; Ramadan v ACN 098 408 176 Pty Ltd & Anor (No 3) [2024] SASCA 19; South Eastern Sydney Area Health Service v King [2006] NSWCA 2; Tjiong v Tjiong (No 2) [2018] NSWSC 1981; Trevorrow v South Australia (No 6) (2008) 253 LSJS 82, discussed. ACN 060 477 830 Pty Ltd (in liq) v Koo DCSA Decision No. 106 of 2012; Associated Confectionery (Australia) Ltd v Mineral and Chemical Traders (1991) 25 NSWLR 349; Australian Education Union (SA) v Grieve [2000] SASC 430; Anderson v Littlemore [1985] WAR 157; Basbuild Pty Ltd v Hall & Anor [2014] SASC 44; Benton v Noye (1990) 101 FLR 18; Burford v Allan [1998] SASC 6693; Burford v Allan (1997) 68 SASR 217; Cheeseman v Bowaters United Kingdom Paper Mills (1971) 3 All ER 513; Cretazzo v Lombardi (1975) 13 SASR 4; Chakravarti v Advertiser Newspapers Ltd (1998) 20 LSJS 44; DSE (Holdings) Pty Ltd v InterTAN Inc [2004] FCA 1251; Digging v Brunotti unreported judgment of King CJ delivered 22 November 1988; Doppstadt Australia v Lovick & Son Developments [2014] NSWCA 158; Drummond and Rosen Pty Limited v Easey & Ors [No 2] [2009] NSWCA 331; Duncan and Wellar Pty Ltd v Mendelson [1987] VR 386; Essential Beauty Franchising (WA) Pty Ltd & Ors v Pilton Holdings Pty Ltd & Ors (No 2) [2014] SASC 141; Elite Protective Personnel Pty Ltd & Anor v Salmon [2007] NSWCA 322; Grace v Grace (No 9) [2014] NSWSC 1239; Grogan v Thiess Contractors Pty Ltd (2000) NSWSC 1101; Hanave Pty Ltd v LFOT Pty Ltd (formerly Jagar Pty Ltd) [1998] FCA 1429; Koo v ACN 060 471 830 Pty Ltd [2013] SASCFC 71; Ljoljic v Sherlock (No 2) (1990) 157 LSJS 463; Latoudis v Casey (1990) 170 CLR 534; Lahoud & Anor v Lahoud & Ors [2006] NSWSC 126; Murphy v Nationwide News Pty Ltd (No 2) [2021] FCA 432; McWilliams Wines Pty Ltd v Liaweena (NSW) Pty Ltd (1993) 32 NSWLR 190; Malaugh Holdings (No 2) Pty Ltd & Anor v Seal & Anor (No 2) [2011] SADC 37; Osborne v Kelly [1999] SASC 486; (1999) 75 SASR 392; Osborne v Kelly (1993) 61 SASR 308; Polias v Ryall (No 2) [2015] NSWSC 1; Rule Chambers Pty Ltd v Badge Constructions [2009] 261 LSJS 434; Rapuano (Trading as Raps Electrical) v Karydis Frisan & Anor [2013] SASCFC 93; Rothe v Scott (No. 5) [2016] NSWDC 225; Smallacombe v Lockyer Investment Co Pty Ltd (1993) 114 ALR 568; Stewart v Atco Controls Pty Ltd (in liq) [No 2] (2014) 252 CLR 331; Trustee for the Salvation Army (NSW) Property Trust & Anor v Becker & Anor (No 2) [2007] NSWCA 194; Upper Hunter County District Council v Australian Chilling & Freezing Co Ltd (1968) 118 CLR 429; Van Zonneveld v Seaton [2005] NSWSC 175; Viscariello v Macks (No 7) [2012] SASC 41; Waller and Waller v Flinders Medical Centre (No 4) (2004) 233 LSJS 438; Whitehead v Maas (No 2) (1991) 56 SASR 362, considered. -- 2 of 84 -- CLONE PTY LTD v PLAYERS PTY LTD (No 16) [2026] SASC 96 Introduction and background 1 In these reasons the applicant is referred to as ‘Clone’ and the respondents as ‘Players’. 2 Likewise, the term “taxation” will largely be referred to, although on occasions the term “adjudication” is used, as this was substituted in rule amendments. The terms have the same meaning and can be used interchangeably. 3 This is the continuing taxation of Clone’s costs of the trial before Vanstone J in these proceedings. The only remaining issues are Clone’s claims for interest on costs and the costs of the taxation itself. By agreement, the interest issue is being determined first. 4 When the interest argument commenced, a dispute arose as to the mechanism for this process. Following service of Clone’s short form claim for costs, Players served three separate offers, each including interest, relating to solicitors’ fees, disbursements, and counsel fees. Players accordingly sought a ‘two stage’ process to first determine the dates from when Clone’s interest entitlement was to commence to run, and then, based on the Courts ruling, calculations could be made as to Clone’s interest on its costs for those components based on the amounts allowed for each and having regard to the amount of each offer. 5 In reasons Clone Pty Ltd v Players Pty Ltd (No 13)1 I ordered that the assessment of Clone’s interest was to be undertaken in two separate hearings, on the above basis. The present and second hearing (Stage 2) would determine whether Players had relevantly “beaten” their offers, and if so, the consequences as to interest in relation to the period from the date of service onwards. 6 In the first stage Clone Pty Ltd v Players Pty Ltd (No 14)2 I determined that Clone was to be awarded the lump sum of $125,000 for interest to and including the date of the offers, allowing two more months to consider them. 7 Subsequently, Players applied for a review of that order and in further reasons, Clone Pty Ltd v Players Pty Ltd (No 15),3 I declined to decrease the total interest awarded in Stage 1, but upheld the second ground and in lieu of the total award of $125,000 I ordered that a revised specific interest calculation be performed in respect of each of the three components and the parties were directed to confer and agree appropriate amounts for each of these. They did so and in a joint memorandum dated 18 November 2025 they agreed interest and costs apportioned as follows: 1 [2025] SASC 49. 2 [2025] SASC 109. 3 [2025] SASC 173. -- 3 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 2 1. Solicitors’ fees, together with a proportional lump sum interest allocation, at $249,034.45; 2. Disbursements other than counsel fees, together with a proportional lump sum interest allocation, at $117,948.41; and 3. Counsel fees, together with a proportional lump sum interest allocation, at $388,441.95. 8 A further hearing was fixed for 11 February 2026 to hear Stage 2. 9 The parties then filed written outlines, Clone’s dated 19 January 2026 and Players’ dated 3 February 2026, with Clone’s reply submissions dated 9 February 2026. 10 Players read affidavits of their solicitor Mr Whitington dated 24 April 2025 and 12 January 2026 and Clone read the affidavits of its former solicitors Mark Hamilton dated 20 December 2024 and Dana Paitaridis dated 20 December 2024 and 7 March 2025. 11 Oral submissions were presented at a hearing on 11 February 2026 when Mr B Roberts KC appeared for Clone and Mr P Zappia KC appeared for Players. Both made extensive submissions and Mr Roberts replied to Mr Zappia’s submissions. 12 Including those components of Mr Whitington’s affidavits which essentially comprised submissions, there are accordingly 8 sets of submissions, each relating to multiple issues. Numerous references to case law were referred to and documents were tabled during oral submissions. The material before the Court excluding the case law exceeds 400 pages. 13 Many of the issues argued involved propositions concerning which little previous judicial consideration was reported. Issues for determination in these reasons 14 Clone’s claim for interest on its costs is large, relating to costs taxed at over $600,000, and extending for nearly 20 years. The issues for determination cover five broad topics including approximately 25 subtopics, each of which was extensively argued and required findings and determinations: • A consideration of the legal principles relating to interest on legal costs including the unfettered discretion imposed on a taxing officer, the compensatory principle, disentitling conduct of a costs applicant and its consequences, the role and relevance of costs offers both generally and as a disentitling factor, including arguments relating to the lack of published authority, delays in recovering costs as a disentitling factor, and the status of multiple components of a costs offer. -- 4 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 3 • An analysis of Players three costs offers as to whether or not they comprised rules compliant offers, the bases upon which offers might be found to be non-complying, the status of “all inclusive” offers in relation to interest on taxed costs, the time for acceptance and lapsing of such offers, the inclusion within offers of a component for the costs of taxation, and whether or not the rules regime addresses interest on costs as well as the costs themselves. • If Players offers were found not to comply with the rules, could they otherwise have effect, either contractual or otherwise. • An analysis of Players offers and their effect, whether they should be considered individually or in aggregate, their calculations in comparison to the amounts awarded on the taxation, considering disputes as to the consequences of the offers, whether they had been bettered or not, and the consequences, and the effect of the closeness of the offer for disbursements. • An assessment of the amount of interest which the Court determined was payable. Affidavit evidence 15 The affidavits of Ms Paitaridis and Mr Hamilton identify in detail the payments made by Clone to its solicitors during the proceedings, including the amounts paid and the dates of payment. This information has been relied on by the parties in their submissions as to interest. Mr Whitington’s affidavits exhibited material relied upon by Players as is summarised in the chronology. The balance comprised of essentially submissions. Relevant rules for this taxation 16 Clone’s short form claim for costs, which was served on 23 November 2007, instituted this taxation process (see S, DJ v Channel Seven Adelaide Pty Ltd & Anor).4 The relevant rules applicable are accordingly the 2006 rules in force as at that date, pursuant to Rule 8, including Amendments No 2 and No 3. Other than rules referred to in earlier judgments, all rules referred to in these reasons are the 2006 Rules. Chronology of events 17 The following history of the proceedings is established from the Court record and the affidavits read by the parties. Issue of Proceedings – 24 March 2004 18 Clone’s claim related to an agreement made in August 1994 to lease its premises in the City of Adelaide to Players. During 2002, a dispute arose relating 4 (2007) 97 SASR 118. -- 5 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 4 to repairs to the premises and liquor licensing issues. On 24 March 2004 Clone issued these proceedings against Players. Vanstone J judgment in favour of Clone – 22 July 2005 19 The proceedings commenced before Vanstone J in March 2005. After a 29- day trial, judgment was given for Clone on 22 July 2005. The Court upheld its claims on all but one issue. Costs orders made in favour of Clone – 18 August 2005 20 Costs orders were made in favour of Clone by Vanstone J on 18 August 2005. Full Court appeal – 4 July 2006 21 Players appealed to the Full Court which on 4 July 2006 largely upheld Clone’s claim but remitted one matter back to Vanstone J. However, this matter was rejected by Vanstone J on 22 September 2006. Special leave application refused by the High Court – 10 November 2006 22 Players sought special leave to appeal to the High Court, but this was refused on 10 November 2006. Assessment of Clone’s damages – 2007 to 2009 23 The assessment of Clone’s damages proceeded throughout the latter part of 2007 and into 2008, but in October 2009 this issue was settled by the parties based on a payment, inclusive of costs, by Players to Clone. Clone served a schedule of its costs to Players for the costs of the trial, and applied to dispense with a short form claim – 17 April 2007 24 On 17 April 2007 Clone wrote to Players advising of its claim for costs of the trial, fixed at $912,052.13 (exclusive of GST). It attached a schedule and expressed its confidence that on a taxation it would recover all of these fees, indicating that its solicitors had already written off substantial amounts in professional fees. On the same date it applied to dispense with the filing of a short form claim and instead to proceed straight to a long form claim. Clone filed and served a short form claim for costs – 23 November 2007 25 On 23 November 2007, nearly a year after the High Court verdict and seven months after its letter formulating its costs, Clone filed and served a short form claim totalling $926,545.00. This comprised the initiation of the taxation proceedings. Unusually for a short form claim, it was 106 pages long, with most of the items identified by their components. The only apparent claims for its taxation fees were for preparation of its short form claim ($6,881.68) and for copying this ($107.91). No anticipated further components relating to the taxation process were included or itemised. This was the only claim Clone made to Players for its costs prior to Players offers made on 20 February 2008. -- 6 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 5 Players filed and served a reply to the short form claim and requested inspection of Clone’s files – 21 December 2007 26 On 21 December 2007 Players filed and served their reply to the short form claim, disputing every item. They responded requesting that their costs counsel, Mr Cogan, be allowed to inspect Clone’s files so they could make an offer without the need for a formal taxation. They assert that Clone failed to respond to this request, and that the first time this was addressed was at the hearing on 25 January 2008. At the time when Players disputed every item in the short form claim in their reply, they were seeking to inspect Clone’s files, so presumably they were not then in a position to assess their position. Once the files had been inspected, it is noted, they promptly made their offers. Hearing before Judge Withers ordering Clone to proceed with a long form claim – 25 January 2008 27 Judge Withers ordered that both Clone’s application to proceed immediately to a long form bill, together with Players application for a preliminary determination of issues, be listed for argument on 13 February 2008. Clone argued that under the rules Players were no longer entitled to an inspection of its files. Players responded that this was counterproductive. The Court directed that Mr Cogan be permitted to inspect Clone’s files before the next hearing. Clone permitted Mr Cogan to inspect its files – 6 February 2008 28 On 6 February 2008, Clone confirmed arrangements for Mr Cogan to inspect its files, and he did so thereafter. Players letter to Clone – 6 February 2008 29 Players wrote to Clone summarising the interactions between the parties’ concerning costs, stating that they had been clear throughout about their intentions, that they had acted consistently, that they had always wanted to receive Clone’s claim, inspect its files, and make an offer, and that far from seeking to prevent the claim, they had taken positive steps to resolve it by doing so. However, they said, Clone had failed to provide any response to their request until the 25 January 2008 hearing. They intimated that had Clone approached the issue in a reasonable and commonsense way, as was required, they would have immediately inspected its files, which would have been completed, an offer made to Clone, and a resolution of the costs achieved before that hearing. In the event, the argument fixed for 13 February 2008 did not proceed. Players filed and served three costs offers – 20 February 2008 30 Players filed and served three separate offers, each referring to rule 187 and relating to the solicitors’ fees, counsel fees, and other disbursements, each including components for interest. Clone failed to respond to these offers. Nor is there any evidence that at any time thereafter it sought clarification, made any counter-offers or proposals, or that it followed up at any time. -- 7 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 6 Clone filed a long form claim for costs – 11 March 2008 31 On 11 March 2008 Clone filed and served an itemised two volume, 467-page long form claim for costs totalling $926,562.27. This was very slightly higher than the amount which had been claimed in the short form bill. It covered the period of the trial between 3 February 2004 and 21 November 2007. At the conclusion, it itemised costs at $377,711.85 and disbursements, including counsel fees, at $548,850.42. At some time, the date of which is unclear, a separate memorandum of Clone’s counsel fees was provided to the Court and Players, and this was later used to tax these fees. Notice of Dispute to the long form bill (FDN 149) filed by Players – 9 April 2008 32 Players filed a notice of dispute to the long form bill. Commencement and continuation of the taxation – 2009 to 2010 33 The taxation commenced before Master Withers sometime in 2008 and progressed between then and 2010. There were hearings on 30 April 2008, 27 May 2008, 24 June 2008, 25 July 2008, 25 August 2008 and 3 October 2008, and on later dates. From a perusal of the file, I have been unable to establish the exact dates on which the bill was taxed, but it is obvious that it took place over many occasions during this period. Numerous specific rulings and other more general rulings were made. Master Withers’ notations on the itemised long form bill indicate that most of the items up to and including items 653 (page 48) were then taxed and completed. Player’s applications for a retrial and in fresh proceedings, and their hearing and final determination – 17 December 2010 to 21 March 2018 34 On 17 December 2010 Players applied for a re-trial of the proceedings and it issued fresh proceedings to set aside the judgment, alleging malpractice. As a result, the taxation was adjourned and did not resume for several years. Various appellate hearings proceeded and at a second trial before Hargrave AJ a judgment was given on 28 August 2015 partly setting aside the original judgment. 35 Hargrave J also ordered that Clone refund all monies which Players had paid to Clone in relation to the trial before Vanstone J. and the 2006 Full Court appeal, together with interest calculated at the Court rate. 36 Clone appealed to the Full Court, which on 8 December 2016, by majority, upheld the set aside orders, although it substituted a party/party costs order in favour of Players in lieu of the indemnity cost order awarded by Hargrave AJ. 37 Clone appealed to the High Court from that decision and the set aside proceedings were finally determined by the High Court on 21 March 2018, when it allowed Clone’s appeal, set aside the orders made at the second trial, and restored Vanstone J’s original orders, including the costs judgment. These proceedings spread over more than 7 years. -- 8 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 7 38 Following the High Court appeal the original allocaturs in Clone’s favour were reinstated. 39 Thereafter Players returned to Clone the refunded amount, plus interest that had accrued between 17 November 2015 to the date of Players refund in 2018. Interim allocaturs paid by Players 40 The second affidavit of Mr Whitington establishes that Players has paid to Clone the sum of $447,000 on account of its entitlement to costs, based on an interim allocatur dated 19 June 2009 in the amount of $72,000, and a further interim allocatur dated 21 September 2018 in the amount of $375,000. These payments do not appear to be in dispute and have been factored into their respective submissions as to what should be awarded. The resumption, continuation and conclusion of the taxation of costs – June 2019 to 2025 41 The taxation of Clone’s costs of the Vanstone J trial resumed before me on 4 March 2019 and has continued since then, the most protracted taxation I have encountered in over 50 years as a practitioner and taxing officer. It has involved numerous applications on multiple issues, involving interim allocaturs, contested arguments on points of principle, the filing of affidavits, the cross-examination of solicitors, the delivery of numerous written judgments, reviews of rulings, and other aspects. At times, the parties agreed items, but the majority were argued and ruled upon. The taxation of solicitors’ fees, counsel fees and disbursements concluded by late October 2024, when the interest arguments commenced. 42 The amounts claimed by Clone and awarded on the taxation were agreed by the parties as follows: Solicitors’ fees Claimed $377,711.85 Allowed $207,826.77 Counsel fees Claimed $414,472.30 Allowed $324,166.53 Disbursements Claimed $134,378.20 Allowed $ 98,431.51 Totals Claimed $926,562.35 Allowed $630,424.81 43 The reductions were accordingly significant. At the conclusion of the taxation, the interest on costs arguments commenced. The interest arguments 2025 44 The interest arguments commenced with an argument as to how they were to proceed. In Reasons (No 13) I determined the manner of assessment of interest, and in Reasons (No 14) I awarded the Stage 1 lump sum interest to Clone in the sum of $125,000. In this assessment I provided that the interest was to run up and until two months after the date of the offers – namely until 20 April 2008 – so as to provide sufficient time for Clone to consider the offers and to respond. -- 9 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 8 45 In Reasons (No 15) I varied this order so as to apportion interest among the three components of solicitors’ fees, disbursements, and counsel fees. Summary of the parties’ submissions on Stage 2 46 Detailed written and oral submissions have been provided by the parties in support of their contentions. 47 In short, Clone submitted that interest should continue to be computed from the date of payment of each interim invoice rendered by its former lawyers from the end of Stage 1 to the present day, unaffected by Players offers. It argued that because interest on costs is compensatory and not punitive, deprivation of interest on its costs paid over 20 years ago and onwards would not only undermine the compensatory rationale but would reward Players for their conduct occasioned by the set aside proceedings. 48 The offers had no status under any relevant rules of court as concerned interest on costs, because the designated effect of the non-betterment of an offer under the rules concerned costs, and not interest. Players had failed to identify any case where the refusal of an offer concerning costs had been considered in relation to interest on costs. The offers were non-complying for the purpose of the rules, two had not been bettered, much less unreasonably refused, and globally, they had amounted to materially less than the taxed costs inclusive of interest. It was artificial to separate the three offers into their constituent parts by reason of the close relationship between the taxation of costs of solicitors, counsel, and other disbursements. Regarding the solicitors’ fees offer, if the costs of the taxation to the point where the offers fell for consideration had been brought into account, it was overwhelmingly probable that it would not have been bettered. Having regard to the delay this should not warrant the deprivation of interest in the circumstances. Finally, the consequences of Hargrave AJ’s orders as to repayments (later set aside) should be taken into account; as should the findings on the determination of Stage 1. Clone’s calculations as to interest were set out in a schedule covering the period between 1 December 2008 and 11 February 2026 totalling $724,712.59. 49 Players submitted that the previous reasons were relevant to the issue of interest. The Court had confirmed that an offer of settlement could be considered in respect of an award of interest. Although the overriding purpose of interest on costs was to compensate a party for being kept out of the use of its money, the taxing officer’s discretion was unfettered. The disentitling conduct of a costs recipient could be taken into account, and a relevant factor was the importance of allowing a paying party the opportunity to exercise their rights under the rules to make a costs offer after having been properly informed as to the costs claim. The offers were individually relevant to that assessment. Clone had never responded to them, nor were they ever withdrawn. The solicitors’ fees offer had been substantially bettered, the disbursements offer had come close to being bettered (and on one view it had been bettered) and although the counsel fees offer was below what was awarded, had Clone accepted the solicitors’ fees offer the length -- 10 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 9 of the taxation would have been substantially shortened. This would have reduced, to a very large extent, the size of the interest claim. 50 They argued that Clone’s submission that the offers did not specifically provide for its costs of taxation, did not render the offers non-complying. Further, its short form claim for costs specifically included a component for the drawing of its bill of costs. The costs offers regime allowed a component for interest on legal costs within the content of offers. Clone’s delay in the recovery of its costs should be taken into account as a disentitling factor. So should the delays occurring in the taxation process occasioned by inadequacies in its record keeping, and its inability to substantiate components of its claims. Even if the offers were found to be unenforceable under the rules, they would nevertheless have application on a contractual basis. The multiple offers complied with the rules, and they remained in force and did not lapse. Players provided schedules of the proposed interest awards consistent with their submissions. Principles The power to award interest under s114(2)(b) 51 The Supreme Court Act 1935 includes a power to award interest in respect of a judgment in two places. 52 The first is s 30C which refers to an award of interest in favour of a judgment creditor. The text of this section clearly assumes that it addresses pre-judgment interest. The basic principle governing the award of interest to a party who recovers a money judgment is that interest is not compensation for damage done, but rather recompenses it for being kept out of money which should have been paid earlier.5 Although this is a principle directed primarily at pre-judgment interest, it also has general application to post-judgment interest. 53 The second provision is s 114(2)(b) which refers to interest payable under any judgment or order including an order as to costs. It confers a broad discretion on the Court: Osborne v Kelly [1999] SASC 486 (Doyle CJ, Mullighan and Wicks JJ) at [22]; Chakravarti v Advertiser Newspapers Ltd (1998) 20 LSJS 44 at [46]- [47]. 54 The heading of s 114 “Interest on judgment debts” clearly prima facie deals with post-judgment interest. This is consistent with the approach of the Court of Appeal in Ramadan v ACN 098 408 176 Pty Ltd & Anor (No 3).6 Clearly, it also deals with interest on costs. 55 Parliament has vested this discretion in the taxing officer: Osborne v Kelly per Doyle CJ at [22] and [42]. Consistently with that provision, in disposing of that appeal the Full Court at [66]-[69] remitted the matter to the taxing officer for further consideration. However, the fact that the taxing officer exercises a broad 5 Duke Group Ltd (in liq) v Pilmer (1998) 27 ACSR 1 at 417. 6 [2024] SASCA 19 at [19]-[20]. -- 11 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 10 discretion does not mean that there are no available principles or guidelines to assist a court in exercising the discretion: Osborne v Kelly, at [24]. 56 I discuss these principles further in these reasons under the headings “The time from when interest commences to run” and “Disentitling factors relevant to an award of interest on costs”. 57 The power to award interest is conferred by Parliament to the taxing officer quite independently of the offers and taxation of costs rules, however the rules necessarily have a role to play in the exercise of the discretion. The Compensatory principle 58 In Latoudis v Casey,7 at 543 Mason CJ held that it was clear that in the realm of costs, interest was not awarded by way of punishment of the unsuccessful party, but rather it was compensatory in the sense that it was awarded to indemnify the successful party against the expense to which he or she had been put by reason of the legal proceedings. 59 In Osborne v Kelly8, Doyle CJ, Mullighan and Wicks JJ found that the section conferred a discretion upon the Court, which had often been described as unfettered, and like all discretions, it was required to be exercised judicially. What this meant, by reference to the underlying object of interest, was to compensate a party for being kept out of the use of its money by a defendant. Its purpose was not to punish a party for being unsuccessful in the litigation, nor was it to make the defendant account for its having had the use of the money, but rather to compensate a party for being kept out of the use of their money.9 60 In McWilliams Wines Pty Ltd v Liaweena (NSW) Pty Ltd,10 Rogers CJ at 191 emphasised the financial hardship which would be imposed on a litigant required by its own solicitors to pay its costs to them as the matter proceeded, and would thereafter remain bereft of any compensatory interest payment until after due course the costs had been taxed and interest then only paid from that date. 61 Similar observations were made in Drummond and Rosen Pty Limited v Easey & Ors [No 2].11 To this end, an award of interest on costs has the same purpose as an award of interest on damages sustained prior to judgment: Osborne v Kelly (1999) 75 SASR 392 at [32]. 62 In the context of costs, the purpose of an award of interest has been described as to compensate and indemnify the successful party for the expense he or she has 7 (1990) 170 CLR 534. 8 (1999) 75 SASR 392. 9 Trevorrow v South Australia (No 6) (2008) 253 LSJS 82; Lahoud & Anor v Lahoud & Ors [2006] NSWSC 126 at [82]-[83] per Campbell J; MBP (SA) Pty Ltd v Gojic (1991) 171 CLR 657 at [663]; see also Clone Pty Ltd v Players Pty Ltd (No 14) [2025] SASC 109 at [97]. 10 (1993) 32 NSWLR 190. 11 [2009] NSWCA 331. -- 12 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 11 been put to in the litigation: Malaugh Holdings (No 2) Pty Ltd & Anor v Seal & Anor (No 2) [2011] SADC 37 Smith DCJ at [66]. The time from when interest commences to run 63 The background concerning awarding interest on costs arose in the 19th Century English practice, which was to draw up the judgment specifying the amount of the verdict (if the plaintiff was successful) but leaving the costs figure blank. When the costs were taxed and the figure was known, it would be inserted into the blank which had been left in the formal record of the judgment. 64 On its face, the record of the judgment, which would be dated at the time the judgment was given, would then include an amount for costs. This led to a question as to whether interest on the costs should run from the date the costs order was made (“the incipitur rule”) or from the date the certificate of taxation issued (“the allocatur rule”). 65 Under the allocatur rule, the successful party would receive nothing by way of compensation for the period up to the completion of the taxation. In theory, one advantage of the incipitur rule was that it gave the successful party some measure of compensation for the time value of money between the making of the costs order and the issue of the costs certificate, but it was a blunt instrument. It would overcompensate a successful party who did not actually pay costs to his or her lawyers until the taxation was finished. Nor would it compensate for the time value of costs paid prior to the beginning of the taxation. 66 Section 114(2) originally only prescribed that the taxing officer could award interest on costs from the date of the certificate. However, in 1991 this provision was amended by Parliament to include a wider discretion. The section then provided: Section 114 – Interest on judgment debts (1) All money, including costs, payable under any judgment or order shall bear interest at the rate from time to time prescribed by the rules of court. (2) The interest shall be computed from the following times: (a) in the case of money other than adjudicated costs, from the time specified in the judgment or order, and if no time is so specified from the date of the judgment or order; (b) in the case of adjudicated costs, from the date of the certificate of the adjudicating officer by whom the costs were adjudicated or an earlier date specified by the adjudicating officer in the certificate. (emphasis added) 67 Following the amendment to s114, the principles as to interest on costs were discussed in several decisions. -- 13 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 12 68 In Chakravarti v Advertiser Newspapers Ltd Doyle CJ at [14] and following observed that the effect of the provision was to commit to the taxing officer the decision as to payment of interest and the date from which it was to be paid. It was clear that this provision gave to the taxing officer a wide discretion. It was not a matter where the Full Court should deal with the matter itself, and there was no particular reason why it should depart from the ordinary practice in that case. Further, it would be inappropriate for a taxing officer to proceed on the basis that interest would be payable from the date of judgment, unless the taxing officer was persuaded otherwise. This was because the statutory provision gave to the taxing officer a wide discretion, which was not to be exercised based on any prima facie starting point which had to be displaced. If the Full Court was wrong in that and there was a starting point, then it appeared to be the date of the certificate of the taxing officer. 69 In Burford v Allan,12 the Full Court discussed the question of interest on costs in the context of a cross-appeal. Under the sub-heading “Cross-appeal” Doyle CJ wrote:13 An award of costs to a litigant bears interest pursuant to s 114(1) of the Act. In the case of taxed costs, interest is computed from the date of the certificate of the taxing officer … or an earlier date specified by the taxing officer in the certificate. That provision, in my opinion, gives to the master or judge concerned a discretion. The discretion is unfettered and is to be exercised having regard to the facts and to the interests of justice. The starting point is not an award of interest from the date of judgment by virtue of which the party is entitled to costs. There must be some basis for the exercise of the discretion to order that interest to be computed from a time earlier than the date of the certificate, and in particular to order that interest be computed from the date of the relevant judgment. All sorts of matters could be relevant to this question, including delay by the party ordered to pay costs or an unreasonable approach to the taxation of costs which causes delay. Some of the brief remarks made by the master and by the judge are capable of suggesting that the plaintiff had a right to have interest computed from the date of the judgment in her favour, subject only to the defendant establishing some reason to deprive the plaintiff of interest from that earlier date. It may be that that was not what was intended. Reference is made by the master, in particular, to other matters that would support the computation of interest from an earlier date. I immediately make the point that, in my opinion, there is no such presumption about the time from which interest is to be computed, and it is a matter of the Court being satisfied that there are proper grounds upon which interest could be computed from a date earlier than the date of the certificate, and in particular from the date of the judgment that confers the entitlement to costs. 70 The Full Court rejected an argument that the plaintiff should have costs relating back, on the basis that he had not paid his costs, so the question of compensation was not relevant. 71 In Osborne v Kelly, Doyle CJ at paragraphs [22] and following adhered to the views taken in Burford and Chakravarti that Parliament had conferred on the taxing officer a broad discretion to be exercised by reference to the relevant 12 [1998] SASC 6693. 13 [1998] SASC 6693 at [8]. -- 14 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 13 circumstances of the case, and it was a question of whether there were proper grounds to compute interest from a date earlier than the date of the certificate. A consistency of approach in the exercise was desirable, and the fact that the taxing officer exercised a broad discretion did not mean that there were no available principles or guidelines to assist the Court in exercising the discretion, referring at [24] to the observations of Mason CJ in Latoudis v Casey14 dealing with the power of a court of summary jurisdiction to award costs in the exercise of its statutory discretion. 72 At [41] –[42] and following Doyle CJ acknowledged the force of submissions from the plaintiff that it would be unfair if he had been kept out of his money when it was available to the defendant, and that in a general sense it would be fair that the plaintiff rather than the defendant should have the benefit of interest earned on the amount of costs ultimately held to be payable, but wrote that this concept was not an argument that the South Australian Parliament had chosen to adopt, preferring to leave the matter to the discretion of the taxing officer. To adopt such a rule to guide the exercise of the discretion would mean that, absent some disentitling conduct by the plaintiff, the defendant would always pay interest at least from the date of judgment. Such an approach would depart from the principle that the award of costs, and an award of interest, was provided to compensate the plaintiff for costs or expenses incurred. 73 The principles concerning when interest was to run on costs were discussed in my reasons in Malaugh Holdings (No 2) Pty Ltd v Seal & Anor,15 where I noted the offer and acceptance provisions of rule 187(2)(b) of the District Court Civil Rules 2006 (SA) and rule 101.16(k) of the District Court Rules 1992 (SA), and referred to various circumstances relevant to awarding interest on the costs of the successful party. 74 These included the fact that payments had been made by the costs claimants to their solicitors from time to time during the course of the litigation; the length of the litigation; the delay in finalising the matter; the fact that the respondents had not as yet made any payment of either the judgment sum or costs or interest save for one payment on an interim allocatur; whether the approach of the respondents to the taxation of costs had been unreasonable; the considerable success of the respondents in reducing the amount they would otherwise have to pay; the date upon which the amount payable pursuant to the taxation became known (being the date when the bill was provisionally cast by the Registry); the fact that a more accurate schedule of costs would have enabled the taxation to have been completed in a shorter period of time; and an order made relating to interest on costs in the matter in the Supreme Court. I ordered that interest should run from the dates that 14 (1990) 170 CLR 534 at [541]. 15 District Court (SA) Actions 1453 of 2002 and 1388 of 2003, reasons published 19 August 2009 (unreported). -- 15 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 14 the applicant had paid monies on account of costs to their solicitors, but reduced that amount having regard to the other issues. 75 On review of my decision, in Malaugh Holdings (No 2) Pty Ltd & Anor v Seal & Anor (No 2),16 Judge Smith referred at [66] and [69]- [72] to the guidelines or principles assisting the exercise of the discretion as canvased in Osborne v Kelly, supra. He wrote at [66] and [69]-[72] that although it was obvious to say that to fully compensate and indemnify the plaintiffs the taxing officer’s order should not only require the unsuccessful defendants to repay those sums paid on account of costs, to the extent that they were allowed on taxation, but also to require the defendants to pay interest thereon from the dates of the payments, a question would arise whether there were any other relevant factors which might support a decision not to backdate the calculation, because in Osborne v Kelly it had been made clear that it was appropriate for the taxing officer to also have regard to “disentitling conduct”. Disentitling conduct by the successful party could result in a reduction of the award of interest. 76 He went on to find that on the evidence there was no delay for which the plaintiffs were solely responsible and which could be characterised as disentitling conduct. He continued at [73]-[74] that on the proper construction of (the equivalent District Court section as to interest) the starting point was an award of interest. The successful litigant had a statutory entitlement to interest “at a rate prescribed by the rules” on the “judgment debt” which included costs awarded and taxed. The discretion embodied in the section, operated only in respect of the running of the interest. 77 Judge Smith declined to vary my Review decisions and confirmed my orders. 78 There are similar provisions to s 114 in other States and there is a body of case law on the topic. The development of the principles as to the dates from which interest was to run were discussed in Tjiong v Tjiong (No 2),17 Parker J at [25]-[26]. Disentitling factors relevant to an award of interest on costs 79 In Digging v Brunotti (unreported judgment of 22 November 1988) King CJ in discussing the award of interest, wrote: ‘Counsel for the plaintiff submitted that the defendant should pay interest for the period of the adjournment because he had the use of the money during that period. The authorities are now clear, however, that interest is included in judgments not because the defendant has had the use of the money but because the plaintiff is kept out of it. It follows that if the plaintiff is kept out of the money due to his own default, he should not be allowed interest during that period.’ 80 In Osborne v Kelly,18 when Mohr J (with whom Bollen and Millhouse JJ agreed) wrote at [311] that there were differing views expressed in several cases 16 [2011] SADC 37. 17 [2018] NSWSC 1981. 18 (1993) 61 SASR 308. -- 16 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 15 as to whether or not the plaintiff was to be deprived of interest for some period due to his delays in prosecuting his claim. Mohr J observed, inter alia, that: There are differing views expressed in a number of cases as to whether or not the plaintiff is to be deprived of interest for some period due to his delays in prosecuting his claim. In Batchelor v Burke (1981) 148 CLR 448 Gibbs CJ said (at 455): “The interest is awarded to compensate the plaintiff for the detriment that he has suffered by being kept out of his money, and not to punish the defendant for having been dilatory in settling the plaintiff’s claim.” This would appear to be the basic reasoning behind the award of interest. In the present case it is not suggested that the appellant (defendant) was dilatory. Rather attention was focussed on the time it took for the action to come on for trial. 81 His Honour referred to Digging v Brunotti, and continued: The High Court in MBP (SA) Pty Ltd v Gogic (1991) 171 CLR 657 at 663 repeated the principle laid down by Gibbs CJ in Batchelor v Burke (supra). … In the present case there is no doubt that the respondent was kept out of his money for some 12 years from that date of the issue of the writ until trial. Whatever may be the case, where it can be shown that the delay in bringing the action to trial can be sheeted home to the plaintiff, for denying such a plaintiff interest for some period in my opinion the critical factor is in the words of King CJ in Digging v Brunotti (supra) “the plaintiff is kept out of the money by his own default”. In the present case whatever may be said about the causes of the delay there is no suggestion that the plaintiff himself was responsible for them except in the sense that he was not capable of controlling the time taken. … 82 This extract from Mohr J’s reasons was referred to in Burford v Allan (1997) 68 SASR 217 Matheson J at [225]. 83 In Grace v Grace (No 9)19 Brereton J, although declining to apply disentitling factors, referred to these in his judgment at [67] and [69], whilst acknowledging that the circumstances in which a claim for interest could be refused were rare: [67] … In the absence of countervailing factors, it is ordinarily appropriate that an order for interest on costs be made, so as to compensate the party entitled for being out of pocket in respect of the costs that party has paid. … [69] While the power to make an interest on costs order is discretionary and interest may be declined if there are "countervailing factors", as with prejudgment interest under s 100(1), the circumstances in which a claim for interest can be refused are rare. … 19 [2014] NSWSC 1239. -- 17 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 16 84 Brereton J observed at [76] that a party who obtained a costs order would ordinarily, in the absence of any countervailing discretionary factor, also obtain an order for interest on those costs, if it sought one. 85 In Doppstadt Australia Pty Ltd v Lovick & Son Developments Pty Ltd,20 Gleeson JA (Ward and Emmett JJA agreeing) stated: … in the absence of any countervailing discretionary factor, it is appropriate that an order for interest on costs be made to compensate the party having the benefit of a costs order for being out of pocket in respect of relevant costs which it had paid. There is no requirement to establish that the circumstances of the case are out of the ordinary: Drummond and Rosen Pty Ltd v Easey & Ors (No 2) [2009] NSWCA 331 at [4] per Macfarlan JA (Tobias JA agreeing) citing Lahoud v Lahoud [2006] NSWCA 126 at [82] - [83] per Campbell J.21 (emphasis added) 86 It is best that evidence of the amounts paid on account of costs be available for provision to the court to avoid argument on this issue, in Rothe v Scott (No 5),22 Gibson DCJ held that: … While I note that actual evidence of payment was provided in Doppstadt Australia v Lovick & Son Developments at [404]), it is not necessary for the court to receive actual evidence that payments of costs have been made, or that the costs have been "fructifying in the wrong pocket": Polias v Ryall(sic) (No. 2) [2015] NSWSC 1 at [63] to [65] per Rothman J. (sic). Nor is it necessary for me to set out the details of when any such payments occurred in the interest on costs order that I propose to make, as any dispute as to quantum on assessment of costs can be dealt with by the costs assessor on the basis of the statements to this effect in this judgment.23 87 This view mirrored that of Rothman J in Polias v Ryall (No 2),24 where his Honour stated: ‘... a party who obtains a costs order will ordinarily – in the absence of any countervailing discretionary factor – also obtain an order for interest on those costs, if it seeks one, and evidence of payment of the costs is not required; nor is evidence explaining the course of the proceedings ...’25 88 In the present case evidence as to the payments made by Clone has been provided in the affidavits of Mr Hamilton and Ms Paitaridis. 89 In an article commenting on the above cases, “Interest on Costs Regimes [2017] Precedent AULA 13 by Phillipa Alexander, published online in Austlii, the author observed that countervailing factors to such an award may include vacated hearing dates, unsuccessful interlocutory arguments, or other factors resulting in 20 [2014] NSWCA 158. 21 Ibid at [403]. 22 [2016] NSWDC 225. 23 Ibid at [23]. 24 [2015] NSWSC 1. 25 Ibid at [66]. -- 18 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 17 adverse costs orders, disproportion between the costs and quantum of the claim, and costs incurred in respect of matters which were abandoned or unsuccessful. The effect of delay by a party in taxing its costs 90 The issue of delay by a party in taxing its costs as a disentitling factor has been considered in a number of cases. I discussed this in Reasons (No 14) at [166] and following. There is case law on this issue. Grogan v Thiess Contractors Pty Ltd26 concerned interest on costs, and relevantly to the present case, the effect of offers as to costs. Barr J noted at [13] that there had been a twenty-two-month delay in the plaintiff’s instructing his solicitors, and a 30-month delay in commencing proceedings, and at [14], that there was a delay by the plaintiff in the preparation of his bill of costs following the dismissal of the defendants’ appeal. His Honour held, however, at [17] that clearly a substantial time was needed to do what the plaintiff’s solicitor had to do, and he was not satisfied that any delay was sufficient to justify denying compensation to the plaintiff. In ACN 060 477 830 Pty Ltd (in liq) v Koo,27 a claiming party applied for interest on its costs calculated from the various dates of payment of costs to its solicitors. However, there had been delays in the preparation and filing of the short form bill. Judge Chivell found that this nine-month delay was “inordinately long”. There had been a further delay in seeking an order for a detailed taxation once the response to the short form bill had been received. He referred to a further period of five months in this regard. These delays were taken into account in fixing the interest awarded. Judge Chivell’s decision was upheld on appeal to the Full Court: Koo v ACN 060 477 830 Pty Ltd (in liq).28 The issue of delay by the successful party was also considered in Tjiong v Tjiong (No 2).29 Parker J accepted that events after the making of a costs order could sometimes be relevant to the exercise of the Court’s discretion, the effect on the unsuccessful party also had to be considered. A successful party with an interest on costs order could simply delay the assessment of costs in the knowledge that interest would accrue in the meantime (as Campbell J acknowledged in Lahoud v Lahoud [2006] NSWSC 126). In light of this, when considering making an application for interest on costs, it was important for a party to do so without delay. 91 However, as has been conceded by Players in its written submissions at paragraph [103], the Court has already determined this issue in Stage 1, and had regard to delay, so it is not necessary to consider at this time The importance of offers in litigation 92 It is clear that formal and informal offers are of great importance in litigation. Rule 3 provides that the purpose of the rules includes the facilitation and encouragement of civil disputes by agreement of the parties, to avoid unnecessary 26 (2000) NSWSC 1101. 27 DCSA, Decision No 106 of 2012, Chivell DCJ. 28 [2013] SASCFC 71. 29 [2018] NSWSC 1981. -- 19 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 18 delay in the resolution of civil disputes, to promote efficiency in dispute resolution, and to minimise the costs of civil litigation to the litigants and the State. 93 Rules 187 and 188 regulate the making of offers including offers as to costs. Further, the Full Court recognised the force of informal (Calderbank) offers in Pirotta v Citibank (1998) 72 SASR 259 and in Nominal Defendant v Dighton (No 2) [2012] SASFC 97. 94 In a 2015 New South Wales Law Society CPD Offers of Compromise: Following, Bending and breaking the Rules Justice M J Beazley premised his remarks with the observation that costs in litigation were as important a consideration as the claim that was made, and that the duty to conduct matters efficiently and with a stern eye to the costs implications of a claim was a duty owed not only to the client, but was imposed by Court legislation which obliged the parties to civil proceedings to assist the court in furthering the overriding purpose of the “just, quick and cheap resolution of the real issues in the dispute or proceedings”. He said that if costs, as a general feature of litigation, outstripped the value of claims then the law itself would be brought into disrepute, and that offers of compromise must be seen in this context. As had been observed in South Eastern Sydney Area Health Service v King30 by Hunt AJA at [83] the purpose of rules of court in respect of offers to compromise was to encourage the proper compromise of litigation, in the private interests of the litigants and in the public interest of the prompt and economical disposal of litigation. 95 Justice Beazley further observed that the courts had a costs discretion, and that offers of compromise provided a potential exemption to the primary rule that costs followed the event. These included the two species of offers, namely those made under the rules of court, and Calderbank offers. If a valid offer under the rules was made but rejected, and the offeree obtained an order or judgment on the claim that was no less favourable to that offered, then the offeror was entitled (unless the court ordered otherwise) to their costs assessed. Further, as the High Court had observed in Stewart v Atco Controls Pty Ltd (in liq) [No 2],31 there was a general discretion as to costs, and the non-acceptance of a Calderbank offer was a factor, in some cases a strong factor, to be taken into account on an application for indemnity costs. Justice Beazley concluded with the observation that the Court’s discretionary power as to costs took into account the importance, both in terms of public policy and the private interests involved, in encouraging the settlement of litigation. 96 In Whitehead v Maas (No 2)32 at 367 per King CJ (Mohr and Olsson JJ agreeing) it was established that what became rule 188 provided a punitive approach, because the intention of the rule was to create an incentive to encourage settlements. 30 [2006] NSWCA 2. 31 (2014) 252 CLR 331. 32 (1991) 56 SASR 362. -- 20 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 19 97 In Essential Beauty Franchising (WA) Pty Ltd & Ors v Pilton Holdings Pty Ltd & Ors (No 2)33 Blue J observed at [35] that rule 188(6) sharply differentiated between the consequences of non-acceptance by a defendant of an offer by a plaintiff to settle its claim when the plaintiff obtained judgment on better terms, and the consequences of non-acceptance by a plaintiff of an offer by a defendant when the plaintiff failed to obtain judgment on better terms. In the former case, the plaintiff was prima facie entitled, not only to costs on a solicitor and client basis, but to such costs from the inception of the action, but by contrast, in the latter case, by force of rule 188(6)(b)(i) the defendant was only entitled prima facie to costs on a party and party basis and only in respect of costs incurred 14 days after service of the offer. 98 In Stewart v Atco Controls Pty Ltd (in liq) [No 2]34 the High Court noted the general discretion as to costs, and wrote that the non-acceptance of a Calderbank offer was in some cases a strong factor to be taken into account on an application for indemnity costs. The Court’s discretionary power as to costs took into account the importance, both in terms of public policy and the private interests involved, of encouraging the settlement of litigation. 99 The importance of offers being made in relation to a taxation of costs was emphasised in Viscariello v Macks (No 7)35 where Lunn M noted at [18] and following that the plaintiff could have protected himself against costs if he had made a proper offer (under the then 87R 101.16(k)) before the itemised schedule was prepared, but as he had not done so he was the author of his own difficulty in not being able to resist the substantial costs of the formal adjudication of his liability. 100 These decisions emphasise the importance of all parties being proactive in settling litigation, with penalties to apply if they do not. The Supreme Court offers rules Rule 187 101 Rule 187 permits the making of costs offers and provides for their requirements. 102 As at the institution of Clone’s claim for costs, being the date of service of its short form claim, the rule provided: 187—Offers of settlement (1) A party may, before the relevant date, file an offer of settlement in the Court (a formal offer of settlement). 33 [2014] SASC 141. 34 (2014) 252 CLR 331. 35 [2012] SASC 41. -- 21 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 20 (2) The relevant date is— (a) the date falling 21 days before the first, or any subsequent date fixed for the trial to commence or (b) if the offer relates only to costs and is made in proceedings relating only to the adjudication upon costs, the date falling four days before the date appointed for the adjudication. (3) The offer must— (a) be in an approved form; and (b) if the offer relates to some, but not all, of the claims involved in the proceedings—state to which claims it relates; and (c) state whether the offer relates to costs and, if so, the amount of the offer so far as it relates to costs; and (d) if the offer relates both to principal relief and costs—state whether the party to whom the offer is made may accept the offer of principal without also accepting the offer as to costs, and a copy of the offer must be served on all other parties to the action. (4) A formal offer of settlement must be filed in a suppressed file and must not be disclosed to the trial judge (or the adjudicating officer) unless— (a) all questions to which the offer is relevant have been determined; or (b) a defence of tender before action is raised; or (c) the defendant relies on the offer (together with an apology or apologies) as a defence to an action for defamation and the plaintiff, by pleading, denies the defence; or (d) a declaratory judgment determining liability has been made and the Court permits the disclosure of the offer. (5) If a defendant makes an offer of settlement for a specified amount, the offer may be accompanied by a payment into Court of the relevant amount. (6) An amount paid into Court may be increased but cannot be withdrawn in whole or part unless— (a) the plaintiff consents; or (b) the Court permits its withdrawal. (7) A formal offer of settlement may be withdrawn at any time by the filing of a notice of withdrawal and in such cases, subject to any Court order to the contrary, the offer will be treated as if it had never been made. 103 It should also be noted that the costs recovery (taxation) process is not based upon the subject of a separate costs order. A costs claimant is pursuing its costs entitlement under the one operative costs order. -- 22 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 21 104 Rule 187 was considered in Rapuano (Trading as Raps Electrical) v Karydis Frisan & Anor.36 The plaintiff was successful in a quantum meruit claim, and sought an order for costs, but this was resisted by the defendants on the basis that he had not bettered a number of offers of settlement, both formal and informal, made prior to, and during the course of, the action. At first instance the Judge found that the defendants’ offer fell within rule 187, that the plaintiff had not bettered it, and that adverse findings were made that he had materially exaggerated aspects of his claim, but that the defendants had also engaged in misconduct during the trial. He ordered that the defendants pay 70 per cent of the plaintiff’s costs up to and including two weeks after the offer and that the plaintiff pay 85 per cent of the defendants’ costs after that date. 105 On the plaintiff’s appeal and the defendants’ cross-appeal, the Court of Appeal held that the defendants’ offer was not a valid rule 187 offer. The rule specifically envisaged the entry of a judgment by consent upon the acceptance of a complying offer, but inconsistently with this, the offer had required the plaintiff to file a Notice of Discontinuance upon acceptance. This was not a mere procedural irregularity, so it deprived the offer of any status under rule 187. 106 The Court held that a complying rule 187 offer could not purport to resolve claims not raised in the subject proceedings. The offer had required the parties upon acceptance to enter into a deed of Release and Discharge and a resolution of claims or possible claims separate to the extant proceedings as a condition of acceptance; paragraph 4 thereof was uncertain as to the terms and consequences of acceptance of the offer and it was not in an approved form; it purported to settle not only the extant action but matters outside its purview, contrary to Form 23; it did not permit the entry of a consent judgment, contrary to Form 24; and it was also expressed to be open for a limited period only, after which the offered sum could only be accepted after the amount of a proposed counterclaim and an additional amount in costs was deducted from the offered sum. 107 The Full Court held that the trial Judge was accordingly correct in ruling that neither the plaintiff’s pre-action offer nor the defendants’ counter-offer thereafter were inadmissible pursuant to rule 33(7)(b). Further, the plaintiff’s offer and the defendants’ counter-offer did not on their face purport to be a rule 33 offer and none of the associated correspondence referred to them as such; the withdrawal of the plaintiff’s offer after only 12 days was significant, because rule 33 was a beneficial provision and the requirements as to the timing of offers and responses thereto existed to encourage parties to make genuine offers to settle which would allow the other side ample opportunity to consider them, rather than using offers open for short periods to take advantage of the costs provisions; and neither the plaintiff’s offer nor the defendants’ counter-offer were filed in a sealed file as would be required by rule 33(6)(b). The Judge had been correct in finding that none of the offers proffered by the defendants were rendered admissible by s 36 [2013] SASCFC 93. -- 23 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 22 67C(2) of the Evidence Act 1929. The costs discretion was exercised afresh and consequential orders were made. 108 A non-compliance issue involving the offer rules was considered by Blue J in Basbuild Pty Ltd v Hall & Anor.37 Under rule 187(3)(d), if the offeror does not indicate that the offer may only be accepted in its entirety, then it is up to the offeree, and open to it, to accept the offer insofar as it relates to the principal relief only. The case involved an appeal against a decision of a Judge of the District Court concerning offers. The plaintiff, a builder, claimed damages for breach of contract after its client had determined not to proceed with a building contract. On the same date it filed a formal offer of settlement under rule 187, offering to pay a sum for damages inclusive of GST plus costs fixed in a further sum. Sometime later, the respondent had served a formal acceptance of this formal offer. However, by this time the plaintiff was unhappy with this acceptance, by reason of the fact that it had incurred substantial costs in the period between filing the offer and its acceptance, so it contended that its offer had not complied with rule 187, and for this reason the defendant’s acceptance was invalid. 109 At first instance, a Master held that the formal offer did not comply with rule 188(3)(d) and was void and ineffective. However, on appeal, a Judge overturned this ruling. There followed a further appeal to the Supreme Court where the issue was posed as to whether he had erred in concluding that non-compliance with rule 187(3)(d) did not render the offer a nullity for the purpose of acceptance by the defendants. 110 At [24] and following Blue J considered the provisions of the rule. 111 He found at [30] that the offer did not comply with the rule, because it was ambiguous as to whether it could be accepted in its entirety (paragraphs [29]-[30]), consistent with the decisions of the courts below. However, he then went on to deal with the consequences of this finding, discussing rule 188 at paragraphs [31] and [32], and going on in paragraphs [38]-[47] to find that notwithstanding that a procedural irregularity had occurred, this did not render the contract or the offer void. 112 Blue J noted that then rule 12(1) set out that the consequences of a procedural irregularity such as this did not make an action or a proceeding void, referring also to Heather v Vita Pacific Ltd,38 an action for damages for personal injuries, where the defendant had served an offer of compromise complying with the Tasmanian Supreme Court Rules Order 24A. 113 That Tasmanian rule provided that an offer may be accepted before the expiration of any time specified in the offer, or if no time was specified, the expiration of fourteen days after service, except that the offer did not state, as was required, that it was served in accordance with the order. Shortly afterwards the 37 [2014] SASC 44. 38 (1996) 6 Tas R 120. -- 24 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 23 plaintiff served on the defendant an offer of compromise whereby she agreed to accept a different sum of money in full satisfaction of her claim. The trial proceeded and the trial judge reserved his decision, shortly after which the plaintiff served a notice on the defendant purporting to accept his offer of compromise. The trial judge held that the defendant’s offer was not an offer of compromise within the mean of O24A due to non-compliance, but it was an offer at common law which had been revoked by the plaintiff’s counter-offer, so he found that there was no contract whereby the action was compromised. 114 On appeal, however, the Tasmanian Full Court, following In re Pritchard (Deceased),39 found that the failure of the offer of compromise to state that it was served in accordance with O24A did not render it a nullity, and that the trial judge had erred in failing to exercise his discretion pursuant to the rules to amend the defect in the defendant’s offer of compromise so that it complied with the requirements of O24A. In his reasons, Wright J held that the conduct and understanding of the parties as to the nature and effect of the document would play a large if not crucial part in determining whether or not the amendment or other remedial step under O83, rule 21 would be allowed, applying Crisp & Gunn Co- Operative Ltd v Hobart Corporation.40 115 Also relevant to this issue was Upper Hunter County District Council v Australian Chilling & Freezing Co Ltd41 where at [436] Barwick CJ had observed: But a contact of which there can be more than one possible meaning or which when construed can produce in its application more than one result is not therefore void for uncertainty. As long as it is capable of a meaning, it will ultimately bear that meaning which the courts, or in an appropriate case, an arbitrator, decides is its proper construction: and the court or arbitrator will decide its application. The question becomes one of construction, of ascertaining the intention of the parties, and of applying it. Lord Tomlin’s words in this connexion in Hillas &Co. Ltd. v. Arcos Ltd. (1932) 147 LT 503, at p 512 ought to be kept in mind. So long as the language employed by the parties, to use Lord Wright’s words in Scammell (G.) & Nephew Ltd. v. Ouston (1941) AC 251 is not "so obscure and so incapable of any definite or precise meaning that the Court is unable to attribute to the parties any particular contractual intention", the contract cannot be held to be void or uncertain or meaningless. In the search for that intention, no narrow or pedantic approach is warranted, particularly in the case of commercial arrangements. Thus will uncertainty of meaning, as distinct from absence of meaning or of intention, be resolved. 116 In his reasons, Blue J discussed whether a failure to comply with a settlement rule comprised a procedural irregularity. Noting that rule 12(1) provided that a procedural irregularity did not make an action in a proceeding void, he found that this did not render a formal offer to be void or ineffective, and that the Court had a discretion in appropriate circumstances to avoid a step taken which was non-compliant by setting it aside or dismissing the proceeding, although it would only exercise that discretion when there was good cause to do so. As the offer was effective in the circumstances in settling the action, he gave a dispensation under 39 [1963] 1 Ch 502. 40 (1963) 110 CLR 538. 41 (1968) 118 CLR 429. -- 25 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 24 rule 117(2)(a), which did not require exceptional circumstances and permitted dispensation. The grounds for its exercise specifically referred to the proper conduct of a proceeding in the interests of justice. There was also an inherent power to dispense nunc pro tunc. Rule 188 117 Rule 188 concerns the consequences of filing an offer of settlement in Court. As at the relevant date, it provided: 188—Consequences of filing offer of settlement in Court (1) A party to whom a formal offer of settlement is made may, before the relevant date— (a) accept the offer; or (b) if the offer relates to both the principal relief and costs and the offeror has not indicated that the offer may only be accepted in its entirety—accept the offer so far as it relates to principal relief. (2) In subrule (1), the relevant date is— (a) the date falling 7 days before the first, or any subsequent, date fixed for the trial to commence or (b) if the offer relates only to costs and is made in proceedings relating only to the taxation of costs—the date falling four days before the date appointed for the taxation. (3) The acceptance of a formal offer of settlement— (a) must be in an approved form; and (b) takes effect on the filing of the acceptance in the Court. (4) A copy of the acceptance of a formal offer of settlement must be served on all other parties to the proceedings as soon as practicable after it is filed in the Court. (5) If a formal offer of settlement is accepted, judgment may be entered, by consent, determining the relevant action or claim on a basis reflecting the terms of the offer. (6) If a formal offer of settlement so far as it relates to principal relief is not accepted by the party to whom the offer is made and the Court determines the relevant action or claim on terms (as to principal relief) that are no more favourable to the party than the terms of the offer, then, subject to the Court’s order to the contrary— (a) the party to whom the offer was made is not to be entitled to costs referable to the period falling after the relevant date; and (b) the party that made the offer— (i) if a defendant—is entitled to costs referable to the period falling after the relevant date; and -- 26 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 25 (ii) if a plaintiff—is entitled to the whole of the party’s costs of action on a solicitor/client basis and the defendant is not entitled to any costs not otherwise ordered. (6A) If, after the relevant date, a plaintiff accepts a formal offer of settlement insofar as it relates to principal relief, the Court may, on the application of any other party, order that the plaintiff pay the costs of action incurred by that other party during some or all of the period after the relevant date. (7) In subrules (6) and (6A), the relevant date is the date falling 14 days after the date of service of the offer. (8) If a formal offer of settlement in proceedings relating only to the adjudication upon costs is not accepted by the party to whom the offer is made and the Court determines the proceedings on terms that are no more favourable to that party than the terms of the offer, then, subject to the Court’s order to the contrary, the costs of the adjudication upon costs are to be borne on a solicitor/client basis by that party. 118 As to subrule (6)(b), I refer to Essential Beauty Franchising (WA) Pty Ltd & Ors v Pilton Holdings Pty Ltd & Ors, discussed earlier. 119 Rule 188(8) applies costs penalties consequent upon offers of settlement, emphasising the importance of settlement negotiations. I further discuss this subrule under the topic “the closeness of an offer”, below. Whether bundled offers can be treated as effective 120 Clone submitted that Players offers, which combined all-inclusive components for costs and interest (“bundled” offers) were ineffective. It referred to case law on this issue. 121 In Associated Confectionery (Aust) Ltd v Mineral and Chemical Traders Pty Ltd42 the settlement offer made by the defendant referred to “all claims between the parties…. inclusive of costs.”43 The claim was for a monetary judgment and the costs component offered was bundled up within this sum. The Court’s decision was made by reference to the provisions of Pt 52, rule 17(2), of the NSW Supreme Court Rules 1970, which provided that unless the court otherwise ordered, the plaintiff might tax his costs in respect of the claim against the defendant up to and including the day the offer was accepted, which caused a conflict with the fact that the offer was made for a sum inclusive of costs. As was noted at page 351, paragraph A of his reasons, Giles J found that the offer was ineffective. 122 In Smallacombe v Lockyer Investment Co Pty Ltd44 an open offer to pay a sum of money to compromise the proceedings, which was an all-up offer in respect 42 (1991) 25 NSWLR 349. 43 Ibid at page 350. 44 (1993) 114 ALR 568. -- 27 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 26 of the claim and party and party costs, was likewise held not to be effective. Spender J, referring to Messiter v Hutchninson,45 observed: In my opinion, I think the flexible approach espoused by Rogers J in Messiter v Hutchinson is preferable, but I am firmly of the view that an “open” offer ought to be an offer to settle the claim and that an “all-up” offer of “claim plus costs” ought not to be a relevant consideration on the question of costs and does not fall to be considered in the same way as a Calderbank letter. 123 In Hanave Pty Ltd v LFOT Pty Ltd (formerly Jagar Pty Ltd)46 a Calderbank offer was made to settle the plaintiffs’ claim. The offer was inclusive of costs, but was not in terms which identified an amount offered to settle the claim coupled with an offer to pay costs or a proportion of them on an agreed basis or as taxed. The Court, referring to Smallacombe v Lockyer Investment Co Pty Ltd and Henderson v Amadio (unreported, 28 March 1996), Heery J, found that the offer could not be given effect. 124 In Waller and Waller v Flinders Medical Centre (No 4)47 the plaintiffs, prior to judgment, lodged an offer to accept a global sum for their claim, inclusive of costs, and when later they were awarded a higher sum for damages than that provided in the offer, they applied for an order for solicitor client costs based on the fact of that offer. They contended that the offer came within then rule 41.01 and that they were entitled to such costs by operation of that rule. However, Judge Lunn observed that there was no authority known to him in which it had been considered whether an amount of an offer inclusive of costs was one which could be the subject of that rule, referring to both Associated Confectionery and Smallacombe v Lockyer Investment Co Pty Ltd. 125 Referring to the terms of the then District Court offer rules, Judge Lunn refused the application. He observed at [8]: There is a very cogent reason why RR 39 to 41 should operate only on offers exclusive of any additional entitlement of the plaintiffs to the costs of the action. If a payment in or offer under these rules is not accepted, the Court in determining what cost consequences follow under the respective rules after judgement upon a trial have to compare the amount paid or offered with the judgement sum. Subject to possible small problems about pre-judgement interest accrued to the date of payment in or offer, a judge can readily compare the amount paid in or offered with the judgement sum and determine whether the special costs all such as R41.04 operate in those circumstances. If the amount paid in or offered was to be inclusive of costs, it is almost impossible for a trial judge to determine how much of the amount paid in or offered is for the claim and how much is for costs. When the amount paid in or offered is close to the judgement sum it might require a full taxation of costs, to the date of payment in or offer before it could be determined whether the costs consequences followed under these rules. That would be time-consuming, expensive and serve no worthwhile purpose. The interpretation I have placed on these rules facilitates an expeditious and economical resolution of any issues under the rules concerning consequences in costs. The plaintiffs’ counsel submitted that defendants like to receive 45 (1987) 10 NSWLR 525. 46 [1998] FCA 1429. 47 (2004) 233 LSJS 438. -- 28 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 27 offers inclusive of costs. That may be so, but R41 does not recognise it. If a defendant wants an all- up amount, it can negotiate to obtain it. This view of the Court needing offers to be exclusive of costs is consistent with a view taken by Spender J in Smallacombe v Lockyer Investment Co Pty Ltd (1993) 114 ALR 568 at 572-3 concerning “Calderbank” letters. It is not to the point that in this particular action the inclusion of the costs did not preclude a workable comparison between the offer and the amount of the judgement: whether an offer is within R 41.01 (1) cannot depend on a subsequent variable, i.e. the amount of the judgement. 126 In Van Zonneveld v Seaton48 the successful plaintiff had offered to settle prior to the issue of proceedings. The defendant made three offers when the proceedings were on foot, two of which were for a judgment sum inclusive of costs. The Court found, however, that an offer inclusive of costs was not one which in accordance with Part 22 of the NSW Supreme Court Rules could trigger the costs consequences connected with an offer of compromise under Part 52A rule 22, nor was it an effective Calderbank offer. 127 These cases all suggest that “bundled offers” incorporating offers for a judgment sum and costs are not complying offers. 128 However, this case law does not appear to have been universally applied. In Elite Protective Personnel Pty Ltd & Anor v Salmon49 Basten J at [102] and following, while noting the line of authority, observed that in M.T. Associates Pty Ltd v Aqua-Max Pty Ltd & Anor (No 3)50 Gillard J wrote at [125]-[126] that many cases were settled on an “all in” basis and there was little difficulty in making an assessment of the likely amount of the claim and costs. 129 In DSE (Holdings) Pty Ltd v InterTAN Inc51 Allsop J did not regard there to be a definitive rule that in an application for costs an offer for an all-inclusive sum could not, in any circumstances, be taken into account by a Court in considering whether thereafter indemnity costs should be awarded. 130 In Trustee for the Salvation Army (NSW) Property Trust & Anor v Becker & Anor (No 2)52 at [25]-[29] Ipp JA (with whom the other members of the bench agreed) wrote at [28] that an offer of compromise which was expressed to be all inclusive of costs was capable of being accepted by the appellant on the basis that it was an informal Calderbank offer and it should be regarded as such. 131 I will discuss this issue in more detail, below, when considering the parties’ arguments. However, significantly, all the cases where the offers were found to be ineffective concerned those blending costs with a judgment sum, so they can be distinguished. 48 [2005] NSWSC 175. 49 [2007] NSWCA 322. 50 [2000] VSC 163. 51 [2004] FCA 1251. 52 [2007] NSWCA 194. -- 29 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 28 132 In contrast, the present case involves offers relating to awarded costs (not a judgment sum) and interest on those costs. These are to be determined in the one process, by a taxing officer as part of a single taxation exercise. As Lunn J observed in Waller and Waller v Flinders Medical Centre (No 4), where the amount paid in or offered was to be for a judgment claim inclusive of costs, it would be almost impossible for a trial judge to determine how much of the amount paid in or offered was for the claim and how much was for costs. However, where the amount offered is for costs and interest only, which is the present situation, the taxing officer can easily determine how much is for the costs component. Whether an offer in terms not authorised by the rules is one upon which the rules can operate 133 In Benton v Noye53 the second defendant served on the plaintiff an “offer to compromise” purporting to comply with NT Supreme Court Rule 26.02(3). The offer stated that it was open to be accepted "at any time prior to 10 am on the first day of the trial”. However, that rule provided that as to the time such an offer was open to be accepted, “the time expressed shall not be earlier than 14 days after service on the other party”. The Court found that rule 26.03(3) was perfectly clear as it provided the word “shall” rather than “may” and the notice was accordingly an irregularity which could not be cured. The plaintiff had not waived any irregularity or misstatement in the document, which was an offer in particular terms, one of which involved a time period after which the offer lapsed, so accordingly the document was not an offer to compromise within the meaning of the appropriate rules. Offers must be sufficiently explicit such that there could be no reasonable doubt about the consequences of their acceptance 134 In Duncan and Wellar Pty Ltd v Mendelson54 the Full Court of Victoria (Kaye J, with whom Southwell and Hample JJ agreed) heard argument on a costs application by the defendant following an offer. Following judgment, an appeal set aside the judgment sum and substituted a judgment in a lesser amount. Prior to the trial the defendant had made a compromise offer, which had been rejected, however the substituted judgment was for less than the offer, so the question arose as to the costs consequences. It was noted that the terms of the offer were restricted to the plaintiff’s claim, and its acceptance would have constituted a binding contract between the parties, where like any contract the terms were required to be reasonably certain. However, the fact was that the defendant had claimed contribution and/or indemnity from third parties, two of whom were the plaintiffs in the action, and the offer had not stated whether it was made in respect of the liability of the plaintiffs in the third-party proceedings as well as in discharge of the defendant’s liability for damages in the claim. 53 (1990) 101 FLR 18. 54 [1987] VR 386. -- 30 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 29 135 Referring to Henderson v Simon Engineering Australia Pty Ltd55 and Dajak v Riebe56 the Full Court found that the offer’s terms were not reasonably certain and that it ought not to have left the plaintiffs (the offerees) in any reasonable doubt about the consequences of its acceptance, so it could not be relied upon by the defendant in support of its costs application. Non-compliance with a rules offer will not sound in a contract between the parties 136 In Rule Chambers Pty Ltd v Badge Constructions (SA) Pty Ltd57 a settlement offer was made and served, but later withdrawn. However, the withdrawal was not served on the respondent. Ignorant of this, the respondent then accepted the offer, later asserting that a binding contract had been made, contending that as a matter of contract law it could not be withdrawn. However, the Full Court rejected this proposition, defining the situation as not coming within the scope of contract law. It found that the offers and acceptances were not contractual in their effect and were not to be regarded as if they were. Rather, they were part of bespoke sui generis regime constructed by the rules, which operated when the offer was withdrawn. Accordingly, the offer no longer existed, despite the perversity of the other party having accepted it in the absence of any knowledge as its withdrawal. 137 In its reasons the Full Court considered at length the reason why the rules did not give rise to a contractual offer and acceptance situation. Offers not beaten do not always disentitle a costs claimant from being awarded interest 138 In Murphy v Nationwide News Pty Ltd (No 2),58 a defamation action, the Federal Court ordered the respondents to pay the whole of the applicant’s costs of trial despite the applicant failing to do better than their pre-trial Calderbank offer, although had the respondents framed their pre-trial offer differently, relying on the presumptive cost entitlements under the rules, the decision on costs would likely have been different. 139 Prior to trial, the respondents had made the applicant a Calderbank offer, but at trial, the Federal Court awarded judgment of $111,726 being less than the respondents’ pre-trial offer of $120,000. The Court nevertheless ordered that the respondents pay the applicant’s costs of the entire proceeding. To determine the costs consequences of the offer, the Federal Court was required to consider whether the applicant had ‘unreasonably’ failed to accept it. As it was framed as a Calderbank offer and not a formal offer under the Court rules, whether the judgment sum was more or less favourable than the offered sum was not the determinative test. It found that the applicant did not ‘unreasonably’ reject the offer, focussing on the applicant’s overall success in his defamation action against 55 [1988] VR 77. 56 [1985] VR 57. 57 [2009] 261 LSJS 434. 58 [2021] FCA 432 (costs judgment). -- 31 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 30 the respondents and, significantly, the importance of a judgment vindicating his reputation. It also commented that, had the respondents’ offer been made under the Court rules (rather than as a Calderbank offer), it would likely have ordered the applicant pay the respondents’ costs once the offer was served as provided in the rules. The present case, in contrast, is not a Defamation Act proceeding, which have unique characteristics, and further the offers made by Players are made under the rules, as opposed to Calderbank offers. The Court taxation rules 140 The Court taxation rules as applicable in this taxation provide as follows: 271—Initiation of proceeding for adjudication upon costs (1) A person (the claimant) who claims to be entitled to costs from another person (the respondent) that are liable to adjudication under an order of the Court or these rules, must file in the Court a claim for the costs prepared in an approved form. (2) The claim must include— (a) a notice in the approved form; and (b) a general description of how the claim is made up including a statement of all counsel fees and other disbursements. (3) The claimant must, at the request of the respondent, produce for inspection by the respondent all documents on which the claimant proposes to rely if the claim proceeds to adjudication. (4) Within 28 days after service of the claim on the respondent, the respondent must respond to the claim by filing a notice in the Court— (a) admitting the claim in full; or (b) admitting the claim to an extent stated in the response; or (c) rejecting the claim in its entirety, (and if the respondent fails to respond as required by this subrule, the respondent will be taken to have admitted the claim in full). (5) The Court will, on administrative request, make an order for payment of costs to the extent they are admitted or presumed to be admitted under subrule (4). (6) If the claim is not admitted in full, either party may apply to the Court for a preliminary assessment of the issues in dispute and, on such an application, the Court may exercise any one or more of the following powers— (a) determine the basis on which costs are to be awarded and give any directions that may be necessary or desirable to arrive at a proper award of costs on the relevant basis; (b) resolve issues in dispute between the parties or give directions for resolving such issues by mediation, arbitration or reference to an expert for report; -- 32 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 31 (c) make such orders for costs as may appropriately be made without proceeding to detailed adjudication of the costs; (d) order that the claim for costs proceed in whole or part to detailed adjudication. 273—Preparation of schedule in cases where detailed adjudication ordered (1) In a case where the Court orders that a claim for costs proceed in whole or part to detailed adjudication, the party claiming to be entitled to the costs (the claimant) must— (a) prepare an itemised schedule of the costs in an approved form; and (b) file it in the Registry and serve a copy on the party alleged to be liable for the costs (the respondent). (2) Within 14 days after service of the schedule, the respondent must file in the Registry a response— (a) identifying each disputed item; and (b) stating the ground of the dispute. (3) The Court may allow an undisputed item of costs without inquiry. 141 It is noted that the clear requirements and purpose of rule 271 is to encourage and facilitate the early settlement of costs claims by requiring the filing of a short form claim before the Court permits a claim for costs to proceed in whole or in part to a detailed adjudication under rule 273. 142 In that connection, rule 271(4) requires that within 28 days after service of a short form claim on a costs respondent the costs respondent must respond to the claim by filing a notice in the Court either admitting the claim in full; or admitting the claim to an extent stated in the response; or rejecting the claim in its entirety. 143 Rule 271(5) provides that the Court will, on administrative request, make an order for the payment of costs to the extent that they were admitted or presumed to be admitted under subrule 271(4). 144 Rule 271(6) provides that if the costs claim is not admitted in full (i.e. the short form claim) then either party might apply to the Court for a preliminary assessment of the issues in dispute and the Court then has various powers as to how the matter is to proceed including, inter alia, ordering “that the claim for costs proceed in whole or in part to a detailed adjudication”. Offers are to be considered in terms of the claim which has been made 145 Clone has been submitted that Players cost offer is invalid by reason of it not including within it an allowance for its costs of the taxation. There is authority relating to this issue in somewhat analogous situations. -- 33 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 32 146 In Cheeseman v Bowaters United Kingdom Paper Mills,59 a damages claim, there was reference in the claim to three periods of work only, but for no other period, and no amendment by correspondence. Subsequently the defendants paid into court a sum very slightly exceeding the claim for those three periods. However, on the morning of trial, a fourth period of work was referred to, which had not appeared in the statement of claim. Later the defendants contended that on the pleaded case the plaintiff had recovered less than the amount in court, albeit by a small amount but less nevertheless, so in those circumstances they ought to have the costs, or at any rate not to have to pay the costs after the payment in. The trial judge rejected this argument. 147 However, the Court of Appeal held that because the plaintiff had failed to recover as much as the amount paid into court - even though more was recovered - it was a new case which required an amendment (which had not been made), so the usual costs order in favour of the defendants was made. 148 In Anderson v Littlemore60 it was held in the reasons of Kennedy J at [160]- [161] (with whom Burt CJ and Wallace J published similar reasons) that where a plaintiff had not pleaded his or her special damages the court was entitled in the exercise of its discretion to ignore these in deciding upon the adequacy of the offer. Although the pleading had included the heading “Particulars of special damages” there followed only the notation “to be supplied prior to trial”. The defendant denied liability but paid the sum of $5,000 into Court. The action proceeded but the plaintiff’s award of damages was in the sum of $5,348.50 (including agreed special damages). The respondent was awarded costs after the date of payment into court. 149 On appeal, the Full Court noted that under its rules, costs were in the discretion of the court, although without limiting its general discretion conferred by the Act, and subject to that order, it would generally order the successful party to recover costs. The burden rested upon the appellant to establish that the discretion had miscarried. The facts as established showed a sufficient basis to justify the trial judge’s discretion, because although the plaintiff had recovered special damages in addition to the sum, there was nothing to indicate that the respondent had been supplied with the necessary particulars of these, which was a prerequisite to their recovery. The case was akin to Cheeseman v Bowaters United Kingdom Paper Mills. The appeal was dismissed. 150 These cases will be relevant to Clone’s arguments relating to provision in Players offers for the costs of the taxation. The “closeness” of an offer 151 Subrule 188(8) provides that: 59 (1971) 3 All ER 513. 60 [1985] WAR 157. -- 34 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 33 If a formal offer of settlement in proceedings relating only to the taxation of costs is not accepted by the party to whom the offer is made and the Court determines the proceedings on terms that are no more favourable to that party than the terms of the offer, then, subject to the Court's order to the contrary, the costs of the taxation of costs are to be borne on a solicitor/client basis by that party. 152 It has been judicially observed that the adequacy of an offer does not necessarily require that it arithmetically exceeds the amount awarded. 153 In Cretazzo v Lombardi61 the plaintiff recovered damages for personal injury assessed at $3,828.90 when the defendant had made an offer to consent to judgment for $2,000. The trial Judge had held that in regard to costs, the position of a plaintiff, to whom an offer had been made to consent to judgment for a sum less than the amount awarded, was no different from that of a plaintiff to whom no offer had been made at all. However, on appeal, the Full Court held that the making of the offer to consent to judgment for a sum less than the amount awarded was a factor to be taken into consideration in the exercise of the Court's discretion in making an order for costs, and that, upon the facts, the order made by the trial Judge should be varied. The then applicable offers rule 6A(1), read: Unless for special reasons the Judge thinks proper to order otherwise where in respect of any cause of action a plaintiff recovers judgment for a sum of money which is the same or less than the sum of money paid into Court in satisfaction of that cause of action or is the same as or less than the amount of offer to consent to judgment in respect of that cause of action the Judge shall order that the plaintiff recover against the defendant only his costs incurred to date of payment into Court or the offer to consent to judgment as the case may be, and 14 days thereafter, and he shall order that the defendant making such payment into Court or offer shall recover against the plaintiff his costs incurred after 14 days from the payment into Court or the making of the offer . . . 154 In his reasons at 13, Bray CJ wrote But it can at once be objected that rule 6A (1) speaks only of cases where the amount of the offer is more than the amount of the judgment and has nothing to say to cases where it is less. It is a protection to defendants who make offers which are adequate or more than adequate, not to plaintiffs where defendants make offers which are less than adequate. That is true, but it does not seem to me to conclude the matter. The court, I think, should strive to be even-handed. If the facts and the amount of the offer are of such crucial importance on the question of costs when the offer is more than enough, it seems to me that they ought not to be wholly left out of account when it is less. 155 In his Commentary to subrule 188 (8) in Lexis Nexis Civil Procedure SA Vol 1 at [6R188.35] the then author, Judge RM Lunn, observed that the court exercised its discretion “upon its assessment of the adequacy of the offer and not on whether the judgment equaled or exceeded the amount of the offer”. 156 Judge Lunn further observed that in the context of subrule (6) (relating to offers for principal relief), whether an offer less than the amount of the judgment 61 (1975) 13 SASR 4. -- 35 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 34 could be adequate had been left open in Ljoljic v Sherlock (No 2).62 There, the plaintiff was awarded damages and his application for costs was unopposed. Subsequently, the defendant applied for the costs order to be withdrawn on the basis that the judgment was not much more than a filed offer. However, this application was refused by the trial judge. The defendant’s appeal against this order was dismissed. The Full Court held that the power to withdraw the original order was discretionary, it had not been shown to be exercised on any error of law, and it was not then appropriate for arguments to be put as to the meaning of the word “adequate” in the context of offers under the then costs Rule, rule 40.07. 157 An offer below the judgment sum, which was characterised as “realistic” was held not to be adequate in Australian Education Union (SA) v Grieve.63 There, the defendant’s offer of $30,000 was not accepted. The trial judge found that as at the date of that offer he would have awarded about $44,000, which was greater than the offer. Accordingly, although the offer filed was “realistic” the fact remained that it was below the amount of his assessment, and was not “adequate” in terms of the rule. 158 In Lexis Nexis Legal Costs SA under the heading [6R188.40.1] “Exercise of the discretion” the then learned author Judge Lunn commented that a judge could give the defendant his or her costs even where the judgment exceeded the offer if it was considered that the offer was adequate, referring to Cretazzo v Lombardi. He observed that the discretion was general, and was not limited to unreasonableness, referring also to Lushington v SGIC (No 2).64 He also observed that in England it had been held that the court should take into account the adequacy of the offer at the date on which it was served: Jones v Associated Newspapers Ltd.65 159 There appears little other authority, but it seems that for an offer to have strong costs consequences, it does not need to “perfectly match” the final judgment, but it must be a "genuine offer of compromise" that, in hindsight, was clearly the better option to accept. 160 This would appear to be an appropriate guide to the exercise of the discretion which the rule has permitted. 161 As has been discussed earlier, the concept of “disentitling factors” being taken into account in awarding interest on costs to a costs applicant, includes the fact of offers made by the paying party to pay the costs being declined when later it was demonstrated during a taxation that they were not bettered: Grogan v Theiss Contractors Pty Ltd at paragraph [12] and following. There, the concept of “closeness” of the offer was discussed in paragraph [23], where the Court observed that none of the defendant’s offers went “close” to the amount ultimately awarded. 62 (1990) 157 LSJS 463. 63 [2000] SASC 430. 64 (1993) 168 LSJS 467. 65 [2008] 1 All ER 240. -- 36 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 35 This was one of the factors taken into account by Barr J when declining to disentitle the plaintiff from his claim for interest. 162 The concept of closeness was also referred to in Burford v Allan66 by Matheson J who wrote at paragraph [15] that if he had determined that the allowance of an experts’ fee in full was erroneous: ..that.. then the closeness of the defendant’s offer in settlement (this) should have been taken into account in the defendant’s favour. (emphasis added) A party requiring an opportunity to consider an offer should respond to this effect 163 Clone contends that Players offers were non-conforming as they did not provide any offer with respect to its costs of taxation. However, there is no evidence that it responded to Players offers or invited them to compensate it for those costs, or communicated with Players in any way in response to the offers. 164 I query why Clone chose not to do so at the time. Players offers provided an opportunity for it to negotiate a settlement rather than to pursue a long and expensive taxation in this regard. Mr Zappia in his submissions attributed this to an overreach by Clone in the quantum of its costs. 165 There is judicial authority that a party receiving an offer of settlement in circumstances where it reasonably requires an opportunity to consider its position on an offer should respond to this effect. In Elite Protective Personnel Pty Ltd v Salmon & Anor Basten JA observed at [147] that greater sympathy might be afforded to a defendant who had received an offer early in the proceedings, where there had been no reasonable opportunity for it to assess questions of liability or its likely exposure to costs. A defendant which received an offer of settlement in circumstances where it reasonably required more time to consider its position would no doubt be advised to respond to that effect and, if necessary, make a counter-offer in due course. Do settlement offers under the rules remain open for settlement or do they lapse? 166 Clone has argued that the contention that Players offers remained capable of acceptance throughout the set aside proceedings was both contrary to principle and to their course of dealings throughout that period. Rule 187 contemplated offers being accepted by the relevant date, which under the rules was four days before the taxation. Players, however, contended that as their offers had never been withdrawn, or responded to, remained open for acceptance, and the fact of no response could be taken into account on the question of interest. 167 Neither party cited any authority as to offers lapsing, or not lapsing. 66 (1997) 68 SASR 217. -- 37 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 36 168 Rule 187 relates to the making of offers. Subrules 187(1) and (2) fix a time limit, insofar as an offer relates to the taxation of costs, of four days before the taxation, this relates to the filing of the offer. It does not relate to acceptance. That is dealt with in Rule 188. Subrule (7) relates to the withdrawal of an offer, stating that a formal offer of settlement may be withdrawn at any time by the filing of a notice of withdrawal, and in such cases, subject to any Court order to the contrary, the offer will be treated as if it had never been made. However, the rule says nothing about an offer lapsing. 169 Rule 188 relates to the acceptance of offers. Subrule (1) provides that a recipient may accept an offer. It is linked by subrule (2) which provides for the date of an acceptance, which in the case of an offer relating only to costs, and to proceedings relating only to the taxation of costs, is the date falling four days before the date appointed for the taxation. Although the rule provides for the consequences of acceptance, or non-acceptance -subrules (4) to (8) - nowhere does it say that an offer will lapse if it is not accepted or withdrawn. 170 I am unaware of any judicial consideration of Rules 187 or 188 as to whether or not offers not accepted or withdrawn lapse, other than that referred to in the Commentary to Rule 187 in Lexis Nexis Civil Procedure South Australia by its former author, Judge Lunn, at [6R187.45] where it is observed: [6R 187.45] Duration of offers Under similar, but not identical, New South Wales provisions it was held that an offer made before a trial operated for a re-trial after the first judgment had been set aside: Ettingshausen v Australian Consolidated Press Ltd (1995) 38 NSWLR 404. It would seem an offer under r 187 cannot be expressed to be open for acceptance for a limited time only: Rule Chambers Pty Ltd v Badge Construction (SA) Pty Ltd (2009) 261 LSJS 434; (Full Court), 16 March 2009. 171 It would seem to be the case, therefore, that having regard to the terms of the rules, and the above authorities, that offers as to costs remain open and do not lapse. Assessment of interest on costs as a lump sum 172 In Osborne v Kelly67 at [68], Doyle CJ wrote that s 114(2)(b) conferred a power on a taxing officer to award a lump sum by way of interest in addition to the power to fix a date from which interest was to run, observing that adjusting the date from which interest was to run would be in many circumstances a rather crude device. It was undesirable that a question of interest should give rise to lengthy argument about the selection of a date which would fairly compensate a plaintiff. The power to award a lump sum would inject some flexibility into the process which would avoid artificial arguments over the choice of a date. 67 (1999) 75 SASR 392; [1999] SASC 486. -- 38 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 37 173 In Reasons (No 14) I followed this decision, finding it particularly appropriate having regard to Clone’s submission of two alternative calculations in its Schedule 1, and Players having evidenced doubts as to dates of payment by Clone to its solicitors, in relying on a disentitlement issue by reason of the delay by Clone in the provision in its costs claim, and finally the prejudice to them in providing costs offers until there had been a formulation by Clone of its costs. I held that the task of resolving all these considerations arithmetically would constitute a rather crude device and it was undesirable that the question of interest should give rise to lengthy argument about the selection of an appropriate date. 174 In Reasons (No 15) I observed at [24] that a virtue of assessing interest by way of a lump sum approach was that it “enabled flexibility into the process” and “would avoid artificial [arithmetical] arguments over choices of dates”. Summary of the relevant general principles 1. The applicable rules relating to this argument are the 2006 rules in force as at 23 November 2007, the date of service of Clone’s short form claim. 2. The power to award interest on legal costs is vested in the taxing officer pursuant to section 114 (2)(b) of the Supreme Court Act 1935 and is broad and unfettered, but is required to be exercised judicially. The discretion has been referred to as “unfettered”. 3. This power is independent from the rules offers and taxation of costs provisions, although these necessarily needed to be taken into account. 4. There is no presumption concerning the time from which interest on costs is to be computed, however the underlying object of an award of interest is to compensate a party for being kept out of the use of its money. 5. The law recognises that disentitling factors may be taken into account in appropriate circumstances to decline or reduce an interest award to a successful party to litigation by reason of his or her conduct or default, so the compensatory principle is not absolute. 6. Offers play an important part in litigation, and in appropriate circumstances these can be taken into account as a disentitling factor relating to an award of interest on costs. 7. The costs offers regime under the rules allows a component for interest on legal costs within the content of offers, and a claiming party’s failure to respond to or to better such offers may be taken into account as a disentitling factor in assessing interest on its costs. 8. Delay by a party in the recovery of its costs can be taken into account as a disentitling factor in relation to an award of interest on those costs. -- 39 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 38 9. There has been judicial rejection of the validity of “blended” offers combining payment of principal and costs, however there is also some case law to the contrary. 10. However, where an offer relates only to costs, the assessment of these costs, of the costs of the taxation, and of interest on those costs, these matters are all heard before the taxing officer, so in consequence, the case law relating to “blended” offers is distinguishable. 11. Regard can be had to all-inclusive offers for costs, including individual components covering both costs and interest, and their rejection by a claiming party may be taken into account as a disentitling factor in assessing interest on its costs. 12. It is prudent for a party claiming costs to provide within the details of its claim for those costs both its costs already incurred in that process, as well as its estimated future costs in the taxation process. A failure to do so may be to its prejudice. 13. The offers regime is procedural. Regard can be had to the provisions of the rules relating to their objects, the rule that a procedural irregularity does not make an action or a proceeding void, the rule allowing the court to manage litigation by giving directions appropriate to the circumstances of the case in applying these if a costs offer is found to be non-complying, and the ability of a court to make an order nunc pro tunc. 14. Offers made under the rules are not enforceable as a contract because they are part of a bespoke sui generis regime constituted by the rules (applying Rule Chambers Pty Ltd v Badge Constructions (SA) Ltd). 15. In considering interest on costs, regard may be had to multiple offers individually relating to the components of a claim for costs being solicitors’ fees, counsel fees, and disbursements. 16. There is a utility in multiple offers in resolving the whole or parts of a taxation, as these potentially save time and expense to the Court and the parties. Accordingly, the rejection of all or parts of such offers by a costs claimant may be taken into account as a disentitling factor to its interest on costs award, notwithstanding that in aggregate it might recover a greater amount overall on a taxation. 17. Costs offers under the rules remain open for acceptance notwithstanding substantial delays or interruptions in the progress of proceedings, including a retrial, and do not lapse. 18. Interest on costs may be assessed as a lump sum, and there is often good reason for doing so. -- 40 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 39 Consideration and findings The power of a taxing officer to award interest on taxed costs. 175 As has been discussed, sub section 114(2)(b) of the Supreme Court Act 1935 confers a discretion upon the taxing officer to award interest on taxed costs. This power has often been described as unfettered but it is required to be exercised judicially. There is no presumption about the time from which interest is to be computed, however the underlying object of an award of interest is to compensate a party for being kept out of the use of its money, and in particular a plaintiff by a defendant, and not to punish a party for being unsuccessful in the litigation, nor is it to make him or her account for having had the use of the money. 176 Players have submitted that their costs offers are highly relevant and significant to the exercise of this discretion, having regard to the guiding principle by which an award of interest for costs was made, namely whether a costs recipient had been kept out of its money. Having regard to the offers, they contend that the appropriate orders with respect to solicitors’ fees are that Clone should not be entitled to any interest on these (other than up and until 20 February 2008, already awarded) (In fact, I note, in Stage 1, interest was awarded up and until 20 April 2008). With respect to disbursements, Clone should likewise not be entitled to any interest other than up to and until that date. Mr Zappia submitted that to so award would be unjust, as Clone had seriously overreached in its claim for costs, it had not responded to the offers, and it had not given any reasons for its non-acceptance. However, with respect to counsel fees, it was acknowledged that Clone was prima facie entitled to interest on its awarded costs for the period after service of the counsel fees offer, in addition to the interest to that date already awarded, but subject to consideration of other issues raised. 177 Clone submitted that although Players had endeavoured to articulate what, on their case, should be the outcome, this position was infected by errors and by two other components. 178 The first was a misguided reliance on the impact of the costs regime. Players submission that an award of interest in the circumstances would have a deleterious effect on the efficacy of offers was wrong in principle, because the costs offers regime addressed only the costs of taxation, and not interest. Were their contention to be correct, it would be applied as a matter of course in the general law, where offers before trial were customary, and where the fact of a defendant’s offer that was not bettered by a plaintiff would not affect a plaintiff’s entitlement to interest. Players could have adduced authority supporting the use of offers to that end, but the absence of such authority told against the correctness of their propositions. The second contention as to overreaching was wrong in principle. For any offer to have effect in any context, it would have had to be unreasonable to have been refused. 179 I have considered these submissions. I accept Players contention that the costs regime addresses multiple components, including the assessment of each of the costs claimed by a successful party, also the costs incurred in recovering those -- 41 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 40 costs (namely the costs of the taxation) and also including any award of interest on those costs awarded. This is a single process, and no further applications or proceedings are required to be made once a claim for costs has been lodged and the taxation commences. All the components are heard and determined by the same taxing officer within a single, integral process. Interest on costs, as opposed to interest in the general law, is a unique creature of statute, vested solely in the taxing officer by s114, as was recognised in Osborne v Kelly. 180 As has been discussed above, the relevance of costs offers in relation to interest had been recognised in the case law. An interest award is compensatory, not punitive, so a party liable to pay costs can do no more than to make an offer, and to seek to put the cost recipient in its funds. If in such a situation, were an award of interest to be made against the cost payer, this would be either punitive or occur by reason of some factor unrelated to the guiding principle. I will have regard to these considerations. Disentitling factors against an award of interest 181 Players argued that their offers should disentitle Clone’s interest because had their offers been accepted, the payment of its claimed costs would have then been made and it would not then have been out of pocket. The compensatory principle had no role to play thereafter. 182 Clone acknowledged that there might be instances where a particular discretion could be exercised against an award of interest, such as where a particular invoice was in question and there was good reason to believe that a lesser amount should have been allowed, or where a party had taken up too much court time and the court had found that it was responsible for a delay so it should not be compensated for that reason. However, it argued that as far as could be researched the fact of a costs offer had never been used to deny an applicant interest on its costs. At its highest, there had been two obiter observations to the effect that relevant offers had been bettered, suggesting in a negative sense that the fact of such offers might have been a relevant consideration. 183 Further, Rules 187 and 188, which applied here, dealt with offers having costs consequences, and at least by negative implication, these suggested that they would not have any form of presumptive effect. The fact that interest was not mentioned in those rules as being something enlivened by an offer was telling, and more generally, in no case in the general law had an offer been considered on the question of interest. Outside costs matters, cases regularly occurred where a defendant’s offer was ultimately not bettered by a plaintiff, and he or she could contend that they would not have to pay interest from the date of the offer, because ultimately an offer had been made to compromise the claim. 184 Clone submitted that the reason in principle for there being no authority on this issue was because interest was compensatory and it was recognised that a party had not enjoyed the benefit of its money. This was not intended to be punitive. The only circumstance where courts could, and sometimes did, deprive a plaintiff of -- 42 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 41 some portion of their interest was where they had been guilty of misconduct in the prosecution of a case. There was no sound basis in principle for Players proposition that when it came to assessing whether Clone had been out of its money if the offers had been bettered it would not have been kept out of its money. In fact, Players had gone even further in contending that if the offers came close to, but not more, than the result, this also should deny it interest. 185 Referring to Grogan v Thiess Contractors Pty Ltd and McWilliams Wines Pty Ltd v Liaweena (NSW) Pty Ltd, it submitted that the legislative purpose was not to penalise, but to compensate, so the denial of an order for interest must be seen as a secondary consideration. It argued that under both rules and Calderbank offers, the question was whether there had occurred betterment in terms of the operation of the rules where they had a presumptive effect. The presumptive effect, and the rules, related to questions of costs, and not interest, and in the context of Calderbank offers, the question was whether they were ‘unreasonably refused’. An unreasonable refusal would ordinarily require first, that the offer was better than the party achieved, and secondly, that in the whole of the circumstances it should have been recognised in such a way that the offer would have been accepted. There was nothing in Players offers such as to disentitle it. 186 I have considered these submissions. The principles relating to disentitling conduct have been outlined earlier in these reasons. It is clear that there is no absolute proposition that the sole purpose of a cost order is to compensate one party at the expense of another. Importantly, in Digging v Brunotti68 King CJ confirmed that if the plaintiff was kept out of the money due to his own default, he should not be allowed interest during that period. This was referred to in Osborne v Kelly69 where the Full Court observed that there were differing views expressed in several cases as to whether, or not a plaintiff was to be deprived of interest for some period due to his delays in prosecuting his claim, referring to Batchelor v Burke.70 187 I refer to the earlier observations on these issues, above. It is clear that disentitling conduct by the successful party is a relevant factor in relation to the fixing, by a taxing officer, of an award of interest on costs. The importance of offers 188 It is abundantly clear that formal and informal offers are of great importance in litigation, including a taxation of costs. I have discussed this in the “Principles” section above, including an analysis of the rules and case law. 68 Unreported judgment of King CJ, 22 November 1988. 69 (1993) 61 SASR 308. 70 (1981) 148 CLR 448. -- 43 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 42 Clone’s contention that these is no direct authority relating to offers for costs as a disentitling factor 189 Clone contended that Players had failed to identify any case where the refusal of an offer concerning costs had ever been considered in respect of the assessment of interest on these costs. It submitted that were this to be a material consideration to that issue, then there would be expected to be a significant body of authority supporting it, so the absence of such judicial support weighed heavily. It argued that there was no published authority on costs offers. Offers for damages, analogous to the terms of rule 187, were commonplace, so were Players contentions to be sound, case law on the topic would be expected. 190 In response, Players argued that equally Clone could cite no authority to the effect that the refusal to accept costs offers was not relevant to an award of interest. The absence of authority could not stand as the equivalent of a judicial determination that offers were not relevant, or that they should be given less than their status or weight. Further, in Mr Zappia’s oral argument, he indicated at least some identified authorities as to the relevance of costs offers, one being Reasons (No 14), and others being Grogan v Theiss Contractors Pty Ltd and Burford v Allan (Matheson J), at least in the negative sense. By reason of the underlaying principle, offers must of their nature be relevant and highly relevant, he submitted. 191 In my view, the absence of clear authority does not stand in the way of a finding that offers relating to costs may be relevant in determining an award of interest on costs. Although no citation of direct authority has been made relating to declining to award interest on costs by reason of the costs recipient not accepting an offer or offers, this does not mean that as a matter of principle such an order should not be made. This is because if a reasonable offer was not accepted, but could have been, how could it be contended that a costs claimant had been kept out of its money. Equally, no authority has been cited to the effect that a refusal to accept a costs offer was not relevant to an award of interest. 192 There is judicial recognition of disentitling factors generally as being a relevant factor. There is also supporting case law, at least in the negative sense, as has been referred to in these reasons. Obviously, such an offer must of its nature, be relevant, and indeed highly relevant, when one considers the underlying objective, but taking it into account will depend on the individual circumstances of each case. 193 There are possible explanations for the absence of case law. Claims for costs are usually resolved by negotiation, and the decisions of taxing officers, who assess interest on costs, are rarely reported. Further, very long taxations, which necessarily prolong the time in which interest will accrue and hence its amount, are now also rare. The lengthy taxation of Clone’s claim has necessarily delayed the finalisation of the costs award, and has accordingly increased the size of the claimed interest component, leading to a particular focus here on the size of the amount of interest to be awarded. -- 44 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 43 194 Finally, the offers rules themselves refer to offers relating to taxation of costs, albeit not explicitly referring to offers for interest on costs. The clear intention of the offers rules is to minimise the expense of litigation in all its components by encouraging the provision and acceptance of offers. 195 I have discussed above the provisions of the offers rules 186, 187, and 188, the case law relating to offers, and the value of offers in resolving litigation. Were the position to be otherwise, this would make a nonsense of the whole offer process, because until a party could avail itself of this process, it could not protect its position by making an offer to pay costs, and potentially including interest up to that point. 196 In Reasons (No 14) at [206] I concluded that any challenge to the validity of Players offers would be undertaken in this second phase. On the review of those orders in Reasons (No 15) I determined that it was appropriate to award separate components of interest with respect to solicitor’s fees, counsel fees, and disbursements, consistent with the proposition that offers were potentially a relevant disentitling factor as to an award of interest. 197 I now confirm that conclusion, namely that the fact of offers to settle costs, their content, and the response or non-response thereto, are properly to be regarded in appropriate circumstances as a disentitling factor to the interest award of a costs claimant, although this will be a matter to be determined having regard to the facts of each case. Delay by Clone in the advancement of the taxation of its costs as a disentitling factor 198 The chronological history of the taxation has been set out earlier in these reasons and was covered in some detail in Mr Whitington’s first affidavit. 199 Players contend that a relevant factor in determining any interest awarded to Clone on its taxed costs includes its delay in proceeding to tax its costs. This delay included its application to dispense with the filing of a short form claim for costs, when the Court did not have power under the rules to do so, and the fact that when it did file its short form claim it was not in the usual form (which was to provide an abbreviated indication of its costs to enable it to be prepared quickly and cost effectively). Its form in fact was close to an itemised schedule. Finally, it took Clone more than seven months to prepare, file, and serve this. Players had always wanted to inspect Clone’s files, and to offer a resolution of the short form claim, in a timely fashion. 200 I have discussed the principles and relevance of delay by a costs claimant on its entitlement to interest on its costs. In applying for interest on costs it is important to do so without delay, and if there is a delay this may be a disentitling factor. I refer to Grogan v Thiess Contractors Pty Ltd, Malaugh Holdings (No 2) Pty Ltd & Anor v Seal & Anor (No 2), Tjiong v Tjiong (No 2), Lahoud v Lahoud, -- 45 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 44 Osborne v Kelly,71 Digging v Brunotti, MBP (SA) Pty Ltd v Gojic, ACN 060 477 830 Pty Ltd (in liq) v Koo (District Court) and Koo v ACN 060 477 830 Pty Ltd (in liq) (Full Court). 201 It is clear from the chronological history of the matter that once Vanstone J’s decision was confirmed by the High Court on 10 November 2006, and Clone was entitled to tax its costs, there was a delay occasioned by its abortive attempt to dispense with the short form claim which was not filed until over a year later, on 23 November 2007. Further delay was occasioned by it when Players asked to inspect its files, and it did not respond, instead opposing such inspection on 25 January 2008. However, Judge Withers made an order for inspection. Players inspection then occurred promptly, and they served their offers on 20 February 2008, soon afterwards. 202 It followed that there was a 16-month gap between the High Court judgment on 10 November 2006 and Clone’s filing of the long form bill on 11 March 2008. Clone’s delay in filing and serving its short form claim occurred longer than it might have been. 203 However, the fact is that this period of delay has already been considered and taken into account during Stage 1 (see paragraphs [171]-[172] and [201] in particular) so this has no relevance to the present Stage 2 determination of interest. The time allowed for Clone to consider the offers 204 Clone received Players offers on 20 February 2008 and in Reasons (No 14) at [200] I considered whether it should be allowed time to consider the offers, which remained open. I held that it was reasonable to factor into the interest calculation a period of two months after the date of the offers in which it could respond, as it would then have time to assess whether or not to accept the offers. I accordingly factored in this period in fixing the Stage 1 interest, which was then determined in the $125,000 award. 205 In these circumstances it is unnecessary to include within the Stage 2 interest assessment an allowance of time to Clone to consider whether or not to accept the offers, as it has already had this. Were Players costs offers complying? 206 Clone contends that Players offers are non-complying with the rules, and in consequence they cannot operate: Benton v Noye. It provided three reasons. 207 The first was because the offers were expressly stated to be offers of settlement “solely in respect of the plaintiff’s claim … contained in the Plaintiff’s shortform claim for costs filed on 23 November 2007”. Once the short form claim was later wholly superseded and replaced by the long form bill, it was no longer “a claim.. involved in the proceedings” within the meaning of the rules. Players 71 (1993) 61 SASR 308 and [1999] SASC 486; (1999) 75 SASR 392. -- 46 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 45 had never filed further offers in relation to the ultimate issue, being Clone’s entitlement consequent upon the costs orders, and at the very least, these offers could have been renewed so as to relate to Clone’s claim for costs as articulated in its long form bill. 208 The second was that the offers failed to deal with the costs of the taxation, which, by the time of the offer, were already significant. It referred to Reasons (No 14) at [11]-[20]. A matter in dispute was Clone’s entitlement to the drawing fee in respect of the itemised schedule. However, it argued, the costs of the taxation from 23 November 2007 until the filing of the long form bill on 20 February 2008 were ignored in the costs offers. This was significant given that the costs of taxation at the time were material. Rule 187(3)(c) and (d), required, inter alia, that a rules compliant offer must first state whether the offer related to costs and, if so, the amount of the offer so far as it related to costs. However, the costs offers had failed to state (as was required), whether they were inclusive or exclusive of the costs of adjudication, and whether they might be accepted as to principal only. Further, they had to be sufficiently explicit such that their acceptance would constitute a contract and there would be no reasonable doubt about the consequences of its acceptance. 209 Because it was asserted that each offer was ‘all inclusive’ (which each must be) it was manifestly unclear whether the acceptance of one offer might have compromised the costs of the taxation entitlements for the balance of the offers not accepted. If a total compromise of the taxation costs was not the outcome, it was not clear how the separation of the taxation of costs would occur. Such bundled offers had been found to be not an offer within the rule. This rendered them non- conforming to the rule by reason of the fact that they were not a “formal offer of settlement” within the meaning of the rule. 210 The third reason was that the offers failed to address the costs of taxation incurred after the filing of the short form bill. Each was expressed to be solely relating to counsel fees, solicitors’ fees, and non-counsel fee disbursements contained in the shortform bill. However, by the time of filing, further significant costs of taxation had been incurred. 211 If the offers were implicitly intended to comprise an all-up figure, inclusive of costs, then they were not to be treated as effective. Further, insofar as Players contended that irrespective of whether or not they were valid they might take effect as Calderbank offers or other informal offers, they did not meet the criteria of such an offer, again because the inclusive or exclusive costs of the taxation was unclear. The costs of taxation (ex-drawing fee) were ignored in the costs offers. This only served to emphasise that it was not unreasonable for Clone to reject the offers, only one of which was in excess of the taxed amount (if the costs of taxation to the point of acceptance was disregarded). 212 Further, although each of the offers included a claim for interest, this was in terms of a gross sum, rather than interest at the Court rates. -- 47 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 46 213 What could not be done was for the offeror to ignore costs, because rule 187(3)(c) in its mandatory terms required such offeror to state whether the offer related to costs. Such non-compliance here was not trivial, rather it went to the heart of its assessment. 214 In response, Players submitted that the offers were compliant. In relation to the contention that they were not made in relation to a claim in the proceeding because they related to the short form claim which had been superseded by the long form claim, this was factually incorrect because (importantly) at the time of the offers the only bill in existence (filed or served) was the short form claim, and the question of whether a long form bill was to be served was at that time to be subject to later argument. 215 In relation to Clone’s second contention that the offers did not comply with the rules, this was an artificial argument. First, each of the offers related to a claim in the proceedings. The three concerned the individual components of costs, and the reference to each in the short form bill was simply to enable the identification of such components. Each was made in general terms and was not linked to any bill, as was apparent from the letter accompanying the offers. 216 Pointedly, ultimately what was later claimed in the long form bill was the same as had been claimed in the short form bill. (I note that in fact the totals are different, but only very slightly, the long form bill claims $16.37 more that the short form bill). 217 Further, the letter of 20 February 2008 accompanying the offers set out their intent and purport, and explained that they were new offers, different from their predecessors only in that they were inclusive of any claim for interest on each claim (elaborating on this). The offers made clear that they were referrable to the short form claim. It was clearly expressed that they were made pursuant to rule 187 and that they were offers of settlement in relation to “a claim in the proceeding”, not only because the short form bill existed when they were made, but also because they were dealing with that component in a general sense. 218 Responding to Clone’s submission that each offer was non-compliant because it did not comply with rule 187(3)(c) by reason of it not stating (separately from the amounts for costs Players offered), their offers for the costs of the taxation, Players submitted that the subrule did not impose such a requirement. Rather, what it required was that an offer must state whether it related to costs, and if so the amount of the offer insofar as it related to costs. 219 Included within the compass of subrule (3) were offers relating to the principal relief in the proceeding, which in the present case, constituted Clone’s claim for both breach of the lease and its other claims and costs associated with that claim for principal relief. However, the subrule also provided that if the offer related solely to costs, and the claim also included principal relief, then it had to state whether it related to costs as well as that principal relief. If it was an offer -- 48 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 47 solely as to costs (which was the case here) then the offeror was not required in terms, to include within it a separate amount for the taxation of costs. This was not how the rule, or its plain wording, read. 220 Clearly “costs” as referred to in the rule covered three components, all of which are determined in the same process by the same taxing officer, namely the costs themselves, interest on those costs (if awarded) and the costs of the taxation. 221 In any event, if the rule required some reference to the “costs of taxation” incurred in relation to a costs claim, then Players offers did do that, when read in their proper context, because their offer for solicitors’ fees encompassed all of Clone’s claim for costs, which included an amount for drawing the short form bill. 222 The solicitors’ fees offer, exhibited to Mr Whitington’s second affidavit, clearly identified the component of costs to which Players offer was made by reason of its inclusion within Clone’s short form claim for costs, namely (at page 93) item 22 of the short form claim which comprised an amount for the preparation of the short form bill in the sum of $6,881.68. Accordingly, Players had responded to this individual component of Clone’s short form claim, which incorporated Clone’s costs of drawing the bill, part of the taxation costs, and offered to deal with those costs. 223 I have considered these arguments. I have earlier referred above to the requirements as to the wording of offers pursuant to the rule. However not all of the considerations applicable to common law contracts apply to offers under rule 187. To comply with subrule (3)(d) in stating whether the offer on principal relief may be accepted without the offer on costs, no particular form of words is required, provided that the election on the alternatives is conveyed. The offer must make it clear that it is one made under the rules and not merely under the principles of contract. Only a fundamental error in the wording of the offer will produce a nullity, and merely omitting the part of the form stating the offer on the principal relief could be accepted without also accepting the offer on costs is not such an error. 224 Having considered the parties’ submissions, I regard Players offers to be complying, and even if not, when construed against the background chronology, they deal with the issue of Clone’s costs of taxation. Further, any irregularity should not render them void by reason of rule 12 and the surrounding circumstances. I come to this view for the following reasons. 225 First, the terms of rule 187 provide for offers of settlement to be made. The subsections provide: • A party may, before the relevant date, file an offer of settlement - subrule (1); -- 49 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 48 • The relevant date is, if the offer relates only to costs and is made in proceedings relating only to the taxation of costs (as is the case here), the date falling four days before the date appointed for the taxation - subrule (2)(b); • The offer must be in an approved form - subrule (3)(a); • The offer must, if the offer relates to some, but not all, of the claims involved in the proceedings, state to which claims it relates - subrule (3)(b); and • The offer must state whether the offer relates to costs, and, if so, the amount of the offer so far as it relates to costs - subrule (3)(c). 226 Subrule (3)(d) has no application here because the offers do not relate to both principal relief and costs. 227 Players three offers are each in identical terms (save that each differs in its references to the components and amounts). The relevant wording (relating to solicitors’ fees but the others are similar) is: This offer of settlement is made solely in respect of the Plaintiff’s claim for Solicitors Fees (“the Solicitors Fees Claim”) contained in the Plaintiff’s short form claim for costs filed on 23 November 2007 (FDN 138) The Seventh, Eight and Tenth Defendants OFFER pursuant to rule 187 to settle the Solicitors Fees Claim and any claim by the Plaintiff for interest on the Solicitor’s Fees Claim as follows: That the Seventh, Eight and Tenth Defendants pay the sum of TWO HUNDRED AND SIXTY FIVE THOUSAND DOLLARS ($265,000) to the Plaintiff. 228 Clearly, each offer complies with subrules (1), (2)(b), (3)(a), (3)(b), and (3)(c). 229 Likewise, each offer was valid at the time of their service on Clone on 20 February 2008, which was a date within the period fixed for service within subrule (2)(b). 230 Each offer was clear and unambiguous. Clone complained that they failed to state whether they were inclusive or exclusive of the costs of taxation. However, although the offers did not directly say this, it is quite implicit that the costs of taxation were included, because Clone’s short form bill included a claim for the costs of the drawing of the short form bill (item 22). This was all that Players could respond to, because Clone had chosen not to then formulate any other claim in relation to its costs of taxation, even though there was no doubt that other costs were likely to have been incurred in addition to the drawing fee at that time. -- 50 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 49 231 In my experience as a taxing officer, I have observed that the majority of bills of costs lodged at the Court include details of both the costs already incurred and those costs anticipated to be incurred in relation to the taxation process. These accordingly include provision not just of the already incurred costs of the taxation, (for example, the drawing fee and a copy for service etc) but also for all anticipated (further) attendances relating to the costs of a taxation, such as filing and service of the costs claim, perusing the notice of objections, arranging and conferring with the other party, receiving the notice of taxation, attending upon the taxation, receiving notice of the taxing fees, attending to pay the allocatur fees, and serving the sealed allocatur - but leaving the amounts blank, so they can be completed during the taxation. Such provision makes clear both what the existing costs amount to, and the anticipated costs, thus giving specific notice to the recipient that the claiming party will claim these as part of the taxation process. 232 Such items are included in the precedent Claim for Costs appearing in Lexis Nexis Legal Costs SA (Volume 1A) page 33,283 at items 147 to 167 inclusive. 233 However, other than item 150, such costs did not appear anywhere in Clone’s short form bill. 234 As I have considered earlier under the heading “Offers are to be considered in terms of the claim which has been made” there is legal authority concerning the failure of a party to provide full details of its claim, and the consequences of not doing so when an offer is not beaten. In Cheeseman v Bowaters the plaintiff failed to provide full particulars of a claim for loss of work, and when his damages were assessed at a figure lower than the defendants’ payment into court, the further particulars later supplied were found to amount to a new claim, so the usual costs order in favour of the defendants was made. Likewise, in Anderson v Littlemore the WA Full Court held that where a plaintiff had not pleaded his or her special damages the court was entitled in the exercise of its discretion to ignore these in deciding upon the adequacy of the offer. 235 These cases are both on point. All Clone had claimed in its short form bill was its preparation fee (item 22) Significantly, when it filed its long form bill on 11 March 2008, it failed to claim any attendances relating to the taxation, other than items 6006, 6007, 6008 and 6009 (all relating to the short form claim), even although by that date a two volume, 466 page, 6009 item long form bill had been prepared, filed, and served, and other work must have by then been undertaken. Nor was any claim made for taxation related attendances from the date of judgment up and until to the date of filing of the long form bill. Nor did it provide these details, nor has it since, in any other form. This put Players in a position of not knowing what, if anything, Clone was claiming for these. 236 In response to Clone’s submission that Players offers lapsed, the offers rules say nothing about offers (of any nature) lapsing by reason of the filing of a subsequent claim. This issue has been discussed in the “Principles” section and will be dealt with later in these reasons. -- 51 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 50 237 In response to Clone’s submission that what cannot be done is for the offeror to ignore costs because rule 187(3)(c) in its mandatory terms requires an offering party to state whether the offer relates to costs, the fact is that Players offers did comply with the subrule, as is summarised above, by reason of its references to Clone’s short form bill, which although a claim for costs only, explicitly included a claim for its costs relating to the taxation (the fact that this might have been incomplete cannot be attributed to any fault on behalf of Players), and it implicitly included a claim for interest, which is an incident to a taxation of costs. 238 In response to Clone’s submission that the rules squarely required a separate allowance for costs of taxation to be stated, and if extending to costs, to ascribe a costs component (whether by a fixed number or a statement that the offer was plus costs to be taxed), the answer to this is that the situation pertaining to the offers here do not relate to a claim for principal relief and costs, rather they are confined to a claim for costs only (to which interest may be included at the Court’s discretion pursuant to s114) of which the costs of the taxation are a component. 239 In its submissions Clone referred to cases in support of its submission that a “bundled” offer was inappropriate. However, as I have discussed in the “Principles” section above, these are distinguishable. In the present instance, Players offers can be assessed by me as the taxing officer in a single process. 240 I also reject Clone’s submission that the fact that the interest component of Player’s offers was made in terms of a gross sum rather than interest at court rates invalidated the offers. This issue only goes to whether or not the offers were reasonable. I observe that as was noted by Doyle CJ in the Full Court in Osborne v Kelly it is appropriate in some cases to fix interest in a gross sum amount which does not necessarily accord with court rates. This principle was applied in Reasons (No 14) and Reasons (No 15). 241 Although Clone submitted that it had incurred significant costs in relation to the taxation, no evidence has been put before the Court as to what these costs are, or how they are calculated. This submission is of necessity speculative because the only evidence of Clone’s costs of taxation as at the date of the offers is that of the drawing fee item 22. 242 Further (and again this is necessarily speculative) because at that time the Court had yet to determine whether or not it would require a long form bill, it is quite possible that by the date of the offers Clone’s legal costs, apart from the drawing fee of the short form bill, were minimal. Mr Hamilton had testified in his affidavit of 17 April 2007 that his client was mindful of not having to incur unnecessary costs because the Court had yet to determine the outcome of the application to proceed straight to a long form bill. As has been established in Mr Whitington’s first affidavit at page 6, Mr Hamilton informed the Court that the short form bill (a very long document), had already itemised in detail the bulk of the work undertaken for which the claim was being made. -- 52 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 51 243 Importantly, rule 3 both at the time of the principal proceedings and during the taxation of costs, provided that the object of the rules was to facilitate and encourage the resolution of civil disputes by agreement between the parties, to avoid all unnecessary delay in the resolution of civil disputes, to promote efficiency in dispute resolution as far as was consistent with the paramount interests of justice, and to minimise the costs of civil litigation to the litigants and the State. It is consistent with these rules that the courts should take a pragmatic and commercial approach to facilitate the resolution of disputes, to avoid the expense and inconvenience of litigation, and to not facilitate the finding of undue technicalities in order to void offers of settlement or their consequence. 244 Clone has submitted that by reason of the short form bill being superseded by the long form claim, the offers played no continuing relevance from that time. However, the fact remains that any differences between the short form bill and the long form bill were minimal in their amount. The short form bill totals $926,545.90 and the long form bill totals $926,562.27 a difference of only $16.37. Clone could clearly assess the offers made in response to the short form bill in deciding whether or not they were also reasonable in relation to its long form bill. 245 In response to Clone’s contention that because Players asserted that each offer was ‘all inclusive’ (which each must be) it was manifestly unclear whether the acceptance of one offer might have compromised the costs of the taxation entitlements for the balance of the offers not accepted, the answer is that the costs of a taxation almost exclusively come under the umbrella of the claim for solicitors’ fees. Players offer on this component covered all of the components which had so far been claimed for solicitors’ fees. The fact is that no claim had been made in either the counsel fee component or the disbursement component for any costs associated with the taxation. 246 Finally, as previously indicated, Clone did not respond in any way, shape or form to the offers. It did not raise the issue of Players asserted non-compliance, nor did it put to them that it was also seeking further costs relating to the taxation process. It could have raised this in a response but it failed to do so. It has only raised this issue in the context of the present arguments. 247 I find that each of Players offers were complying. Is the time for acceptance of the offers limited in any way - did Players offers lapse 248 Clone questioned the continuing operative effect of Players offers, noting that they were deliberately confined to the costs claimed in the short form bill, the context of which was that an argument had been fixed concerning its application to proceed direct to a long form bill. Players had responded that it could only proceed with a long form bill once all reasonable settlement options had been explored. However, this argument did not proceed and Players then made their offers, but confined to the claims contained in the short form bill. Knowing that -- 53 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 52 Clone was then to prepare a long form bill, they had previously contended that it could not be entitled to recover the costs of a long form bill. 249 Clone contended that accordingly, the solicitors’ fees offer related solely to the short form bill, so on its proper construction it only applied until it was superseded by the long form bill, so it could only ever have been capable of acceptance during this short time frame. It argued that the other offers were the same. Players contention that their offers remained open was inconsistent with their position from December 2010 when they had applied to set aside the Vanstone J judgment. Their suggestion that the offers remained capable of acceptance was both contrary to principle, and to the course of dealings throughout that period. Further, Rule 187 contemplated offers being accepted by the relevant date falling before the adjudication, which was a date in November 2008. 250 In response, Players pointed out that Clone had never responded to the three offers, so they remained open, they were never withdrawn, and they still had force and effect. The Court had already found in Reasons (No 14) that they were a relevant factor in assessing any award of interest. 251 I have considered these submissions. 252 Although Clone submitted that Players contention that their offers remained open was inconsistent with their position from December 2010 when they had applied to set aside the Vanstone J judgment, this is not the case. The fact is that Players chose not to withdraw the offers, when they could have readily done so pursuant to Subrule 187(7). 253 Although the taxation process had commenced before Judge Withers and was in progress when the offers were made, once the set aside proceedings were issued the taxation was and remained adjourned. However following the delivery of the High Court judgment, it resumed. Vanstone J’s judgment had been restored with the order for the taxation otherwise undisturbed. All that had occurred was a long adjournment. Importantly, Players had never filed a withdrawal of their offers. Nor did Clone either accept or reject them. It never responded. 254 The rules are inconsistent with the proposition that Players offers lapsed. I refer to the analysis, above, in the “Principles” section. 255 Clone has also submitted that the offers could not remain in force once its long form bill was filed, as it superseded the short form bill. However, the fact is that when it was filed it was in its terms virtually identical to the short form bill (other than a very minor difference to the amount claimed). The short form bill closely resembled a long form claim in its appearance and content, totalling over 100 pages in length. The practice at that time (now superseded) was that the short form claim, rather than containing a detailed chronological record of all the solicitors’ attendances (as was the case with the long form bill), “batched” together all attendances of each type (for example, telephone attendances of a solicitor, -- 54 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 53 drawing of documents, perusing documents etc.), all within the relevant scale time periods, and each of which would invite a response from the paying party. The result was an abbreviated form of claim by the costs claimant, reducing the length of the overall claim. In the case of Clone’s short form bill, in contrast, nearly every attendance was itemised, albeit that there was a “batching” of the items into categories. By reason of the resemblance of Clone’s short form bill to its subsequent long form bill, the force of its argument that the offers lapsed because the former was “superseded” by the latter is largely minimised. This strengthens Players submission that their offers should not be regarded as having lapsed on the filing of the long form bill. 256 I also have regard to the case law analysed earlier. The authorities discussed in that section suggest that an offer once made does not lapse, even in relation to a second trial. 257 By reason of Players not withdrawing their offers, and having regard to all of the matters outlined above, I conclude that these continued in force notwithstanding the set aside proceedings, so there is no force in Clone’s contentions that they had lapsed for that or any other reason. 258 I find that Players offers did not lapse and remained open for acceptance. Can non-complying offers be taken in to account in considering interest on costs 259 In the event that I am in error in concluding that Players offers were non- conforming with the rules, and had no effect for that reason, I have considered whether they still have effect. The parties have addressed submissions on this issue. 260 Players submit that even if their offer for solicitors’ fees was non-complying, it was nonetheless relevant because it was capable of acceptance in the formation of a binding contract, entitling Clone to recover the payment offered, so it could not then contend that it had been kept out of its money in respect of that component, and in consequence it could not claim interest subsequently, as this was compensatory. In any event, construed as a whole, it was clear that the offer as to solicitors’ fees was an entire offer which included Clone’s costs incurred in pursuing those solicitors’ fees, so clearly it could be accepted in its entirety. It had been filed and served in response to the itemisation of costs in Clone’s short form bill, including the solicitors’ fees claimed in relation to preparing the bill, so it was accordingly an offer that applied to both. 261 Players also addressed Clone’s contention that the offer was non-compliant by reason of its failure to comply with rule 187(3)(c) in not stating an amount separately from the costs that Players were prepared to offer relating to the costs of the taxation. Their response was that this was not a requirement imposed by rule 187, which related to offers generally, including offers made in relation to the principal relief in the proceedings, which in this case, was Clone’s claim consequent upon breach of the lease and other claims, together with costs -- 55 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 54 associated with that claim for principal relief. Subrule (3) required that if the offer related to some, but not all, of the claims involved in the proceedings, it was to state to which claims it related, and to state whether it related to costs, and if so the amount of the offer insofar as it related to costs. If the offer related to both principal relief and costs, it was to state whether the party to whom the offer was made may accept the offer of principal without also accepting the offer as to costs - subrule (3)(d). Accordingly, if the offer was made solely in relation to costs - the situation dealt with in subrule (3)(c) - Players position was that it did not within that subrule’s terms have to include within it a separate amount for the taxation of those costs. The subrule in its plain wording did not require this. 262 Alternatively, if the rule did require some reference to the costs incurred in relation to the recovery costs, their offers did do this when read in their proper context. Their offer relating to solicitors’ fees made it clear that it encompassed the costs associated with recovering the costs incurred in relation to that claim, evidenced by the fact that it identified the component to which it was made by reference to the short form claim filed by Clone on 23 November 2007. Item 22 of this claim related to the charges for preparation of the short form bill of costs, namely $6,881.68. Accordingly, the offer by its reference and response to Clone’s short form bill clearly offered to deal with Clone’s costs incurred in the taxation recovery process. 263 In summary, Players said, subrule 188(3)(c) did not in its terms require what Clone submitted it did, but even if it did impose such a requirement, then the offer dealt with these costs. 264 Clone had also submitted that Players failed to comply with rule 187(3)(d). However, the fact is that this subrule was not relevant to the situation. It referred to an offer relating to both principal relief and costs (my emphasis), which was not the case here. It simply did not apply to an offer made solely in relation to costs. What it required, instead, was that if an offer related to both principal relief and costs, then the offeror had to state whether the party to whom the offer was made might accept the offer of principal without also accepting the offer as to costs. 265 This was the situation which had occurred in Basbuild Pty Ltd v Hall & Anor, previously discussed in the “Principles’ section, where Blue J found that although the offer there was non-complying, because it was ambiguous as to whether it could be accepted in its entirety, the consequence was that notwithstanding that a procedural irregularity had occurred, this did not render it void. 266 Accordingly, Players argued, even if their offers were found to be non- complying, this did not render them incapable of acceptance. The fact was that the rules did not determine or effect the common law principles of offer and acceptance. When one looked at their offers, they came nowhere near invoking the doctrine of uncertainty and they were plainly capable of acceptance. The solicitors’ fees offer was clear as to what was being offered. Had Clone accepted it, there -- 56 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 55 would have been a binding agreement, and this component of its interest claim would have been resolved. 267 Clone responded to these submissions, arguing that they were contrary to subrule 187(2)(b) which expressly contemplated that the rules regime in respect of offers could be applied to the taxation of costs regime. The subrule did so in a way that meant that the whole of the rules needed to be applied, mutatis mutandis, and for that purpose the offeror was required to provide in the offer for the costs of the taxation proceedings. This was a logical and fair reading of the rules, otherwise costs could simply be ignored despite the terms of the rules where the costs of taxation could be significant. 268 Referring to Basbuild v Hall & Anor, Clone pointed out paragraph [25] thereof where Blue J found that it was common ground that a formal offer related to both the principal relief and costs within the meaning of rule 187(3)(b). It was obvious from the terms of the offer in that case that this was for both the sum of $40,000 for the principal claim, and $3,500 for costs. It had clearly provided for both interest and costs in the same way that rule 187(3)(c) required an offeror to make it explicit whether it dealt with costs or not, and if so the amount for costs. This explained the difference to what occurred under rule 188(1) and the question of whether there was merely a technical difference as opposed to a substantive one. Rule 188(1)(b) provided that a party to whom a formal offer of settlement was made may before the relevant date (if the offer related to both the principal relief and costs and the offeror had not indicated that the offer may only be accepted in its entirety) accept the offer so far as it related to principal relief. This was the position in Basbuild. In other words, the rules became self-regulating if the offeror provided for both. 269 If the offeror did not, on the other hand, say that both principal relief and costs needed to be accepted at once, then the rules would deal with this. What they did not deal with, however, was the inherent unfairness and inappropriateness of failing to comply with rule 187(3)(c), which stated whether the offer dealt with costs or not. If a party accepted the offer, the party was shutting itself out of any ability to recover costs. 270 Finally, Clone submitted, Players proposition that the offer if accepted would lead to binding a contract was inconsistent with the findings of the Full Court in Rule Chambers Pty Ltd v Badge Constructions,72 which is discussed in the “Principles” section above. 271 I have considered these submissions. I have previously concluded that Players offers complied with the rules, because Clone’s claim related to its legal costs, which as articulated in its short form bill incorporated both costs themselves and identified costs incurred in pursuing those costs. 72 [2009] 261 LSJS 434. -- 57 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 56 272 If, however, I am incorrect in coming to this conclusion, I find that the offers nevertheless have effect, relying on the judgment of Blue J in Basbuild v Hall & Another, analysed above. To recap, his Honour there discussed whether a failure to comply with a settlement rule comprised a procedural irregularity. Noting rule 12(1) and Heather v Vita Pacific Ltd he found that a procedural irregularity did not render a formal offer void, and because the settlement offer was effective in the circumstances in settling the action, he gave a dispensation under rule 117(2)(a), which permitted dispensation with a procedural irregularity. That rule did not require exceptional circumstances and it conferred a wide discretion which could be exercised where there was no injustice in doing so. The grounds for its exercise specifically referred to the proper conduct of a proceeding in the interests of justice. There was also an inherent power to dispense nunc pro tunc. 273 Rule 3 provides that the purpose of the rules include the facilitation and encouragement of civil disputes by agreement of the parties, to avoid unnecessary delay in the resolution of civil disputes, to promote efficiency in dispute resolution, and to minimise the costs of civil litigation to the litigants and the State. The offer rules are an important component of the rules and the promotion of these principles. In this case, the parties were in active dialogue at the time as to the resolution of Clone’s costs, as had been set out in the chronology. 274 It is abundantly clear that formal and informal offers are of great importance in litigation to both the parties and the Court, as any further proceedings would occupy much additional time and expense to all. 275 If I am wrong, therefore, in finding that Players offer was rule compliant, I would, in any event, in the exercise of my discretion and relying on Basbuild v Hall & Anor, find that the rules offers were valid and effective. 276 I have also considered, in the alternative, Players contention that their offers if accepted would have constituted a binding contract. However, in this instance, I reject this contention. The Full Court found to the contrary in Rule Chambers Pty Ltd v Badge Constructions, as has been summarised earlier, on the basis that the offers and acceptances regime provided by the rules does not incorporate contractual offers or acceptances, and are not to be regulated as if they were. Rather, they are part of a bespoke sui generis regime constructed by the rules. 277 In summary, although I reject Players submission that their offers were enforceable as a contract, I confirm that Players offers were complaint with the rules regime, and that even if they were not, I can and will give them effect in the exercise of the Court’s discretion pursuant to the provisions of Rules 3, 12, and 117(2)(a). Application of the compensatory principle 278 Clone submits that in the light of the guiding principle that interest on costs is intended to “compensate”, it is entitled to interest on its costs because it has been kept out of the use of the money it had paid to its own lawyers throughout the -- 58 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 57 course of the legal proceedings and thereafter, although some interim payments were made by Players. 279 Much of this period included the eight years of delay occasioned by Players ultimately unsuccessful set aside proceedings. It submits that interest should continue to be computed from the date of payment of each interim invoice rendered by its lawyers until the present day, unaffected by Players offers. It notes that the Court has already held that it was appropriate for interest to be applied from the date of payment of interim invoices rendered by its lawyers, and it argues that this ruling should be carried into effect. It opposes the concept of disentitling conduct by reason of its failure to accept Players offers, and argues that the determination of interest from the time of payment of interim invoices should not be disturbed merely by reason of such offers, which have no status under any relevant rules of court, nor has any case been identified where the refusal of an offer concerning costs was considered in respect of the assessment of interest on costs. It submits that the offers did not comply with the Court’s rules, that they were not bettered because globally they amounted to materially less than the taxed costs inclusive of interest, that it was artificial to separate them into their constituent parts by reason of the close relationship between the taxation of the costs of solicitors, counsel, and other disbursements, that looking at them individually two were never bettered, and that even if they were not bettered or were unreasonably refused, the long delay occasioned by Players set aside proceedings should not warrant the deprivation of interest. 280 Further, Clone submits, the effect of Hargrave AJ’s 2015 orders and the High Court’s 2018 reversal of them, meant that monies paid by Players consequent upon the orders of Vanstone J and the Full Court, meant that it had to refund such monies with interest to Players in 2015, and then, following the High Court’s reinstatement of Vanstone J’s judgment, Players had to disgorge those monies, together with interest, in March 2018. Accordingly, what was in issue was a tiny fraction of Clone’s overall interest entitlement accruing after 2018. Clone submitted that the determination of Stage 2 had to occur against the background of Stage 1 already determined. 281 In response, Players pointed out that in each of Reasons (No 13), (No 14) and (No 15), the Court had already approached the exercise of its discretion as to interest on the basis that all three costs offers were to be individually considered. They submit that this the correct approach, being aligned with the guiding principle governing the exercise of the unfettered discretion to award interest on costs which is that that interest should be considered holistically in order to inject flexibility into the process, and that costs offers would be a relevant factor in assessing any interest payable on a lump sum basis. 282 On consideration of these submissions, and having regard to the authorities, I have determined that in the light of the established principles, costs offers are relevant in determining any interest payable on costs. Players, arming themselves with all available tools, had advanced costs offers to compensate Clone for its legal -- 59 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 58 costs, but these were effectively rejected, no response ever being received. Accordingly, and importantly (subject to an analysis of further relevant considerations), it cannot be said that Clone was kept out of its money, which is a guiding consideration as to an award of interest. 283 To award interest against Players in the face of their offers would be to act on an unprincipled basis, because a party liable to pay costs can do no more than to make an offer and to seek to put the cost recipient in its funds. Regard should also be had to the fact that s 114(2)(b) of the Supreme Court Act confers a discretion upon the taxing officer, often described as unfettered. 284 Further, from an examination of the authorities, it appears evident in any event that the relevance of costs offers in relation to the question of interest on costs has been judicially recognised. I refer to the reasons of Matheson J at page 225 in Burford v Allan, when he referred to the observation of King CJ in Digging v Brunotti that “ it follows that if the plaintiff is kept out of the money due to his own default, he should not be allowed interest during that period”, and those of Smith DCJ in Malaugh Holdings (No 2) Pty Ltd & Anor v Seal & Anor (No 2), discussed above. 285 I have determined that it is appropriate and relevant to consider the effect of Players offers in regard to Clone’s interest on costs claim. Are multiple offers permitted? 286 Players submitted that it was appropriate for a party to make multiple offers for costs. In a sense the Court had already accepted this position by reason of the way it had dealt with the issue, particularly in Reasons (No 15), when it had apportioned the Stage 1 interest award of $125,000 amongst the components set out in the three offers. This was a correct approach, as quite apart from the rules position, three separate offers had been made, each being capable of individual acceptance. If only one of these offers had been accepted (for example solicitors’ fees), then Clone could not contend that it had been kept out of its money, which was the guiding principle, namely that interest was compensatory. 287 In its written submissions at para [61], Players referred to the taxation of costs subrule 271 which included subrules (1A), (1B), and (2). However, as Clone correctly pointed out in its Reply submissions at paragraph [39], this version of the rule was not in operation at the time the offers were made. 288 Nevertheless, I observe that the then applicable Rule 271(2)(a) required that the claim for costs must include a notice in the approved form, and subrule (2)(b), required a general description of how the claim was made up including a statement of all counsel fees and other disbursements. These rules clearly supported the proposition that claims could be made for these separate components. Further, subrule (4)(a) provided that the respondent to a claim must respond by filing a notice admitting the claim in full, alternatively subrule (4)(b) provided for the notice to admit the claim to an extent stated in the response, and subrule (4)(c) -- 60 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 59 provided that the response could reject the claim in its entirety. Subrule 271(4) accordingly permitted acceptance of part of the claim, which might be the counsel fees, or the disbursements, or the solicitors’ fees. 289 Subrule 271(5) then provided that the Court would, on administrative request, make an order for payment of costs to the extent they were admitted or presumed to be admitted under subrule (4) Subrule 271 (6) provided that if the claim was not admitted in full, either party may apply for a preliminary assessment of the issues in dispute, which meant that after the earlier process had been disposed of, there might be some remaining issues in dispute and the Court could then embark upon resolving these in whole or in part on a detailed taxation. 290 Clearly, the then rules contemplated that it was open to a party to offer or compromise a part of the costs, which allowed for separate offers to be made and considered individually, and accepted, or rejected, as the case may be 291 Clone, however, disputed that the offers could be considered separately. First, it contended, all that had been held in paragraph [101] of Reasons (No 14) was that offers were a relevant factor in the unfettered discretion to award interest. Players had overstated the significance of offers and what the Court had said about them. What had been decided was that there was the need for a second hearing for the Court to weigh as part of its unfettered discretion what the offers meant in terms of that overall exercise of discretion. It was not a question of the Court having already determined that offers had been bettered and that Clone would not recover interest. This would be inconsistent with the reference in the reasons to the discretion being broad, unfettered, and weighing up all of the circumstances and the justice of the case, which was primarily to be addressed by reference to the compensation principle. 292 Clone addressed the schedule tabled on behalf of Players by Mr Zappia during the hearing, relating to the effect of the three offers, arguing that the application in that material of the sum of $125,000 interest solely to counsel fees had inappropriately endeavoured to reduce the amount where Players were conceding the greatest exposure. The fact was that this interest award had been fixed following the analysis of all three claims up and until the time when the offers were made. There was no basis for Players selective application of this component to counsel fees alone. 293 Clone submitted that Rule 271(4) related to the short form bill procedure whereby a party receiving such a bill was required to respond by admitting each item, admitting it in part, or disputing it. Insofar as matters had been admitted, or admitted in part, relating to individual items in the short form bill, these would sound in an interim allocatur. The taxation would then proceed confined to those items not admitted or were only partly admitted – the items truly in issue. Instead, Players had disputed every item contained in the short form bill and had then made a rules offer. They had not admitted counsel fees or other disbursements, much less individual solicitors’ fees, because this would have sounded in a judgment on -- 61 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 60 an interim allocatur. Rather they had chosen to deal with the short form claim in a different way. 294 In response to Players submission that Reasons (No 14) had already determined that separate offers were relevant, Clone replied that what had been held at [101] was that this fact was a relevant factor to the unfettered discretion to award interest. 295 Players had accordingly overstated what the Court had said about offers. The Court had instead determined that there was need for a second hearing to weigh, as part of its unfettered discretion, what the offers meant in terms of the overall exercise of that discretion. 296 A further reason not to permit multiple offers was because as the taxation of counsel fees drew heavily from the concurrent taxation of solicitors’ fees, and vice versa, these were inextricably linked, such that the process and work associated with each could not have been conducted separately. 297 I have considered these submissions. 298 I accept that what was determined in Reasons (No 14) was that there was need for a second hearing to weigh, as part of the Court’s unfettered discretion, what the offers meant in terms of the overall exercise of the discretion, primarily to be addressed by reference to the compensation principle. The Court had left open the question whether ultimately a finding might be made that multiple offers were acceptable. 299 As I have discussed above, the rules are clear in their purport. 300 Rule 271(2)(b) requires that a claim must include a general description of how the claim is made up including a statement of all counsel fees and other disbursements. It emphasises that claims are made for separate and different components, including, specifically, solicitors’ fees, counsel fees and disbursements. 301 Subrule (4)(b) allows a respondent to a claim for costs to respond by filing a notice admitting the claim to the extent stated in the response. (emphasis added). This permits an acceptance of part of the claim, which might be the counsel fees, or the disbursements, or the solicitors’ fees, or parts thereof. 302 Subrule (6) provides that if the claim is not admitted in full, either party might apply for a preliminary assessment of the issues in dispute. This means that after the earlier process has been disposed of, there might be some remaining issues in dispute which the Court can then deal with in whole or in part, on a detailed taxation. 303 Although Players’ response to Clone’s notice was to dispute all claims made by it, the fact is that, it is clear that the taxation rules contemplate that it is open -- 62 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 61 for parties to claim, and for the other parties to then accept or reject, components of the costs. This permits the making of and the individual consideration of multiple claims, and admissions or rejections in response. There is nothing stated in the taxation rules that exclude the use of multiple components. 304 A consistent approach should be taken with respect to both the offers rules and the taxation rules. It is to the mutual interest of the Court and the parties that the time and expense involved in taxations be kept to a minimum. There is a strong public interest in resolving costs claims as far as possible. The resolution of individual costs, or discreet components of a claim for costs, should be encouraged, and it would be contrary to the public interest if multiple offers were not permitted. 305 Finally, I note Clone’s submission that a further reason not to permit multiple offers by Players was because the taxation of counsel fees (or disbursements) drew heavily from the concurrent taxation of solicitors’ fees, and vice versa, and that these were inextricably linked, such that the process and work associated with each could not have been conducted separately. 306 However, I do not see any difficulty arising in the course of a taxation by reason of the Court having to cross reference any individual claim for counsel fees (or disbursements) to the equivalent or matching claim or claims in the solicitors’ fees component of the bill, even if the latter have been agreed. Such comparisons and cross-referencing are frequently undertaken during a taxation without difficulty. 307 Even though all of the claimed solicitors’ fees might have been settled by agreement, the fact is that any bill of costs claiming such items remains before the Court during the taxation of only counsel fees, or disbursements, or both. The Court can nevertheless examine and consider those items that had been claimed under solicitors’ fees, (even if they had been allowed, disallowed, or agreed), in order to determine what to allow or disallow for counsel fees (or disbursements) without difficulty. I see no reason in this regard to disallow the use by Players of multiple offers to Clone for its costs. 308 To require the taxation of solicitors’ fees, even if a figure could be agreed for this component, simply to expedite the taxation of counsel fees or disbursements would be wholly unnecessary, wasteful and expensive to the parties and the Court. Should the Court have regard to Players offers in aggregate, or look to the effect of the individual offers. 309 Clone contended that because in aggregate Players three offers amounted to materially less than its taxed costs inclusive of interest, it was artificial to separate them into their constituent parts, by reason of the close relationship between the taxation of costs of the solicitors’ fees, counsel fees, and other disbursements. -- 63 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 62 310 It contended that the fact was that two of the offers were not bettered, and in the case of the solicitors’ fees component, providing that the costs of the taxation to the point where the offers fell for consideration was brought into account, it was overwhelmingly probable that the offers would not have been bettered by Players. It had certainly not been established that even the third offer was greater than the amount taxed for solicitors’ costs plus interest plus costs. 311 Accordingly, the Court could not conclude that it was unreasonable for Clone to reject the offers. It was inappropriate for Players to argue that the Court should individually segment each of the three offers and then assess them one by one. The purpose of offers was to resolve a matter as a whole and to avoid the consumption of court resources. 312 Clone provided this table in support of its submissions. Component Amount awarded for costs and interest Amount Offered Solicitors fees $249,034.45 $265,000.00 Counsel fees $388,441.94 $295,000.00 Disbursements $117,948.41 $115,000.00 Total $755,421.80 $675,000.00 313 I note that this table contained a minor arithmetic error, in Clone’s written submissions, it had shown $755,421.81 as the total awarded whereas the correct figure is $755,421.80. These figures are not in dispute. 314 Clone reiterated that it had bettered the offers in total, and also two of the three offers on an individualised basis, even putting to one side the significant failure of Players to make an offer inclusive of the costs of the taxation itself. 315 If the Players offers were implicitly intended to comprise an all-up figure, inclusive of costs, then they were not to be treated as effective, Clone referring to Waller and Waller v Flinders Medical Centre (No 4) and Associated Confectionery (Australia) Ltd v Mineral and Chemical Traders. It would be necessary to isolate any costs component within the offers: Van Zonneveld v Seaton; Smallacombe v Locker Investment Co Pty Ltd and Hanave Pty Ltd v LFOT Pty Ltd (formerly Jagar Pty Ltd). To notionally tax the costs of taxation between the short form and the costs offers would be wholly contrary to the existing rationale behind the rule. 316 All that been determined to date was that costs offers may be a relevant consideration to be weighed in all the circumstances, but no more. The starting point should not comprise an assessment of the components on an individualised basis, rather the three offers of settlement should be viewed in the aggregate. Players had advocated that rule 187 should be interpreted as being permissive of multiple offers, however, on their proper construction the rules did not support this, and rule 188 contemplated a single offer. -- 64 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 63 317 Players failure to offer a global sum would have avoided the taxation, and this had to weigh heavily. While notionally the Court could have undertaken a taxation limited to counsel fees and other disbursements, it was necessarily the position that the approach to dealing with the solicitors’ fees were relevant to the way in which counsel fees and/ or disbursement were to be assessed. 318 Players disputed these contentions. 319 They noted that in a sense the Court had already accepted their position by reason of the manner in which it had dealt with the issue in Stage 1, and particularly as set out in Reasons (No 15). This was the correct approach, as quite apart from the position arising from the rules, three separate offers had been made, and each was capable of individual acceptance. If it had occurred that only one of these offers was accepted (for example solicitors’ fees), then Clone could not then contend that it had been kept out of its money, because it would then be entitled to payment by reason of, and upon, its acceptance. This was the guiding principle, namely that interest was compensatory. 320 Players also referred to the effect of the rules themselves. Rule 271(2) required that a claimant must file a claim for costs in an approved form with a general description of how the claim was made up, including a statement of all counsel fees and other disbursements. This clearly supported the proposition that claims could be made for separate components. Likewise, subrule (4)(b) required a respondent to file a notice admitting the claim to an extent stated in the response. This permitted acceptance of part of the claim, which might be the counsel fees, or the disbursements, or the solicitors’ fees. Further, subrule (6) provided that if a claim was not admitted in full, either party might apply for a preliminary assessment of the issues in dispute, which meant that that after the earlier process had been disposed of, there might be some remaining issues in dispute, and the Court could then then embark upon resolving these in whole or in part upon a detailed taxation. 321 Clearly, Players contended, the rules at the time contemplated that it was open to a party to offer or compromise part of the costs, which allowed for separate offers to be made and considered individually. 322 I have considered these submissions. I have determined that the offers can be considered individually rather than in aggregate. 323 Although Clone referred to rule 188 as providing for “an offer”, meaning a single offer, even in its own terms the rule permits the filing of multiple offers. Subrule (1)(b) provides that if the offer relates to both the principal relief and costs, and the offeror has not indicated that the offer may only be accepted in its entirety, the offeree may accept the offer so far as it related to principal relief. The terms of this subrule mean that the offeror may offer two separate things, first either the offeree can accept only the offer in its entirety, or secondly that it might be accepted so far as it relates to principal relief. -- 65 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 64 324 Importantly, if it occurred that only one of Player’s three offers was accepted (for example solicitors’ fees) then Clone could not then contend that it had been kept out of its money, which is the guiding principle that interest is compensatory. 325 The terms of rule 271(2) are also pertinent. This requires that a claimant must file a claim for costs in an approved form with a general description of how the claim was made up, including a statement of all counsel fees and other disbursements. This supports the proposition that claims can be made for separate individual components. 326 Likewise, subrule (4)(b), requires a respondent to file a notice admitting the claim to an extent stated in the response (my emphasis) which permits the acceptance of part of the claim, which might be the counsel fees, or the disbursements, or the solicitors’ fees, or other parts. Subrule (6) is also pertinent, as it provides that if a claim is not admitted in full, either party might apply for a preliminary assessment of the issues in dispute (again my emphasis) which means that after the earlier process has been disposed of, there might be some remaining issues in dispute, and the Court can then then embark upon resolving these in whole, or in part, upon a detailed taxation. 327 In Reasons (No 15) at [96]-[111] I accepted that multiple offers for a claim for costs were required to be considered. During this argument, the parties’ submissions on this issue were noted, and in the reasons, reference was made to Reasons (No 13) where the Court had determined that Clone’s entitlement to interest was to be determined in two stages, and that the bifurcation of the interest argument resulted from the making of three offers, for solicitors’ fees, counsel fees, and disbursements. Following argument on Stage 1, a single award of interest was made, however in the review judgment (Reasons (No 15)) the Court recognised that this ruling had been inappropriate and varied it so that separate awards for costs and interest for the three components were made, so that their effect could be considered in Stage 2. 328 Having now heard detailed argument on the issue of multiple offers, I find that they are permissible. 329 Clone has contended in its submissions that if in the case of the solicitors’ fees component, the costs of the taxation to the point where the offers fell for consideration had been brought into account, it would have been overwhelmingly probable that the offers would not have been bettered by Players. However, this submission is entirely speculative. These costs have never been identified or placed into evidence by Clone. The only reference to them is the drawing fee, referred to in both the short and long form claims, and a few very minor additional items in the long form claim. Further, an inference can be drawn from Mr Hamilton’s affidavit, referred to earlier in these reasons, that these costs were being kept to a minimum. -- 66 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 65 330 A final factor, which is compelling in my view, is the practical utility of allowing the use of multiple offers. There is a benefit to both the parties and the Court in minimising the costs of a taxation. The use of multiple offers contributes greatly to this benefit. They have the potential of shedding off considerable components of a claim for costs, leaving only disputed items which truly need to be taxed, thus saving the expenditure of time and resources of both the Court and the parties by dealing with those costs that are able to be resolved by negotiation. The lengthy process of this taxation over several years graphically illustrates this benefit. 331 I accordingly confirm that multiple offers are permitted by both the offer rules and the costs rules. This proposition is consistent with the approach taken in previous reasons in this matter, and the finding assists to achieve the practical benefit of minimising both the time and costs of a taxation to the parties and the Court. 332 Based on these findings, it is inappropriate to award interest to Clone based on the aggregate amount allowed for the total of Players three offers. Rather, regard should be had to the individual results of the three individual offers which they had made. Delay caused to the taxation process by reason of inadequacies in Clone’s record keeping and /or inability to substantiate items as a disentitling factor in its award of interest 333 I have discussed elsewhere the judicial recognition of disentitling conduct of a party claiming interest on costs including circumstances in which this has been established. 334 Players have explicitly raised this issue in the context of what they assert is the delay occasioned in the time expended on the taxation by reason of Clone being unable on occasions to substantiate its claims in the bill caused or contributed to by reason of the poor or inadequate record keeping of its legal costs. 335 Although assessing the costs of this taxation is a separate exercise, and is not before the Court at this time, Players submit that the record keeping issue is presently relevant because it has caused the prolongation of the taxation beyond what it may otherwise have taken, and thereby should reduce Clone’s interest entitlement. 336 Players submit that just as was the case when assessing the lump sum interest payable to Clone in Stage 1 the Court had had regard in Reasons (No 14) to delays caused to the completion of the taxation brought about by reason of Players set aside proceedings as being a relevant factor in determining interest, it should likewise have regard to the findings made concerning Clone’s record keeping which likewise extended the time spent on the taxation. In this regard Players referred to previous judgments on this taxation to support their contention. -- 67 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 66 337 In Clone Pty Ltd v Players Pty Ltd (No 3)73 at [109] I observed that the progress of the taxation had on many occasions been delayed by reason of Clone having to go back to hunt up records to justify the items it claimed. An application by Players for the production of electronic records, although not ultimately pursued, had been issued to render the taxation process more efficient and to assist the court as to whether individual items could be substantiated or rejected, and to thereby minimise the time spent on the adjudication. Notwithstanding that Players did not proceed with their application, I declined to award Clone its costs thereof and instead ordered that there be no order as to the costs of this application. 338 In Clone Pty Ltd v Players Pty Ltd (No 4)74 at [23] I made similar observations. Although Clone had complained that Players set aside proceedings had caused it delay in substantiating its claims for solicitors’ fees, I rejected this submission and ruled that this did not excuse it from its inability to substantiate its claims. I made further observations at [54]-[60] as to Clone contributing to delays in the taxation and wrote that as a party to the proceedings it had an obligation to maintain an adequate record of its costs pursuant to 6R 262. This required a party to ensure that its records to substantiate any claim for costs in its favour were to be properly kept and maintained whatever twists and turns the case might take, and however long the period may be between the undertaking of the work and the eventual taxation. The consequences for a party which was unable by reason of its own actions or lack thereof to properly substantiate its costs, could not be visited on the paying party which was not privy to the details of the claiming party’s costs, and how they were recorded and substantiated, until the taxation process commenced. 339 Deficiencies in Clone’s records often delayed the hearing of the taxation. On one occasion cross-examination of two of its solicitors as to their record keeping and the content of their cost entries became necessary. On another occasion, the failure to establish whether solicitors, on the one hand, or counsel, on the other, had engrossed certain documents necessitated a full argument followed by a written judgment, disallowing the claims (Clone Pty Ltd v Players Pty Ltd (No 8)).75 340 Players submissions on this issue have substance. Clone’s failure to accept the solicitors’ fees offer, which it did not better even though it included interest, had a cascading effect on the length of the taxation, which has extended over several years. Had the taxation been limited to only counsel fees, or counsel fees and disbursements, it would likely have finished in a very much-abbreviated time span, reducing the interest portion of all three components of its costs. 73 [2020] SASC 29. 74 [2022] SASC 51. 75 [2023] SASC 160 at [17]-[23]. -- 68 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 67 341 The delay in the length of the taxation caused or contributed to by Clone’s record keeping deficiencies further extended its duration. I will have regard to this finding when assessing Clone’s claim for interest on its costs. The closeness of the disbursements offer, and its adequacy 342 The “closeness” of Players disbursements offer comes into consideration. Clone’s claim for disbursements totalled $134,378.20. However, after taxation, the amount was reduced to $98,431.51, excluding interest, a substantial reduction of $16,568.49. Players offer for this component was $115,000, accordingly exceeding Clone’s recovered disbursements by a significant margin. By reason of the interest component of $19,516.90 added in Stage 1, however, Players offer has been “beaten” by Clone’s recovery, but only by $2,948.41. 343 Clone addressed this issue, noting that the concept of closeness had been referred to in Burford v Allan (Matheson J) , but it observed that in their context those statements had been made in the negative rather than in the positive, and that that decision did not stand for the proposition that the closeness of an offer was material, saying that in fact the finding was to the opposite effect - the primary judge had observed that the defendant’s offers were significantly below what could have been considered reasonable, so accordingly they did not need to be taken into account. In summary, it submitted, Burford v Allan could not be relied upon as a proposition stemming from the closeness of the offer. Players offer had been beaten by it, so it should be awarded interest on its disbursements for the whole period involved in Stage 2. 344 Players submission was that in determining whether they had kept Clone out of its money in respect of disbursements, it would be artificial to adopt a strict arithmetical calculation based on the lump sum determination made in Reasons (No 14) and (No 15). The closeness of an offer was a relevant consideration. If, contrary to this contention, the Court were to apply the lump sum award as a basis against which to consider Players offer on disbursements in determining the amount of interest, then Clone should not be awarded any interest on disbursements other than up to 20 February 2008 already awarded to it. 345 This was for four reasons. 346 These were first, that the Court’s discretion with respect to interest on costs did not require that the offeror (namely Players) better the settlement offer in nominal terms to justify or enliven a favourable exercise of the discretion with respect to interest in Players favour. The fact was that the interest discretion under s 114(2)(b) was broader than this. Players referred to Matheson J’s reasons in Burford v Allan at [225] where His Honour observed that while the offer was not close, it might have become relevant if there had been an error in the amount allowed for the expert’s fees. 347 Secondly, in Reasons (No 15) I observed that the virtue of assessing interest by way of a lump sum approach was that it “enabled flexibility into the process” -- 69 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 68 and “would avoid artificial arithmetical arguments over choices of dates”. As Players offer on disbursements was only minimally short, then having regard to the lump sum interest attributed to disbursements, it should not be wholly discounted. 348 Thirdly, based on an application of the ruling with respect to lump sum interest, and the apportionment of that interest attributable to Clone’s disbursements, it had only been “kept out” of $2,948.41 since February 2008 by virtue of its own election not to accept the disbursements offer. In those circumstances, it would be punitive to require Players to pay interest as if it had been kept out of $117,948.41 since February 2008 owing to some conduct attributable to them. 349 Fourthly, it was relevant to note that whereas Clone’s disbursements claim totalled $134,378.20, ultimately it had only been only awarded $98,431.51. This demonstrated a significantly excessive amount claimed for its disbursements claim relative to the actual amount ultimately awarded to it on the taxation. This served to underscore the fact that its conduct was not without relevance in determining its entitlement to interest in respect of this component of its costs. 350 Clone had failed to respond at all to Players disbursements offer. The inference put by Players was that this was due to a significant overreach in what it was claiming for this component. It could therefore readily be inferred that it would not have accepted an offer only slightly higher than that made by Players. 351 I have considered these submissions. 352 Although the discretion to award interest is primarily conferred by s114 (2)(b) it is appropriate to have regard to the case law on this topic as has been referred in the “Principles” section of these reasons. 353 The relevant rule as to the consequences of an offer, rule 188, does not rely on a purely arithmetical computation to determine the effectiveness of an offer. Rather, it uses the term “no more favourable”. As noted, the then learned author of Legal Costs SA Judge RM Lunn observed in his Commentary on the rule that the court exercised its discretion upon its assessment of the adequacy of the offer, and not on whether the judgment equaled or exceeded the amount of the offer, which was an arithmetical approach. In Australian Education Union (SA) v Grieve the trial judge found that although an offer filed was “realistic” it was not “adequate” in terms of the rule, however in that case the proposed award was $14,000 more than the defendant’s offer. 354 Here the opposite occurred. Disregarding interest, Players offer exceeded Clone’s claim by more than $16,000, and including interest, in the context of the claim as a whole it was very close to the mark. The calculations show that of the claim, a total of $35,946.69 was taxed off. Prior to the interest award, Players disbursement offer of $115,000 exceeded Clone’s award by $16,568.49. Even with -- 70 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 69 a substantial interest award of $19,516.90 being allowed, it only bettered Players offer by the comparatively small amount of $2,948.41. The fact is that the overall result has been clearly skewed by reason of the interest calculation, which was necessarily somewhat of a crude exercise. 355 In general terms, in the context of litigation, a settlement offer described as “very close” generally indicates that both parties have moved past extreme initial positions and are negotiating within a range that justifies avoiding the costs and risks of continued litigation, namely if settlement on those terms generates more value for a party than the alternative of litigation. There are no conventionally used methodologies, however, for quantifying the value of this litigation alternative. 356 Having regard to all these matters, I have determined that on any view, the disbursements offer made by Player’s was adequate. Leaving aside interest, had Clone promptly accepted the offer, it would have received $115,000 for disbursements. Instead, following the taxation of its disbursements, it only recovered $98,431.51. The reduction of $16,568,49 was substantial. Notwithstanding its interest award, Clone only “bettered” Players offer by less than $3,000. 357 The adequacy principles discussed in Cretazzo v Lombardi and Australian Education Union (SA) v Grieve and other cases and commentary are relevant. As Bray CJ wrote in Cretazzo, the court should strive to be even-handed, and if the facts and the amount of the offer were of such crucial importance on the question of costs when the offer was more than enough, that they ought not to be wholly left out of account when it was less. 358 I will have regard to these considerations in the overall approach taken when assessing interest on Clone’s disbursements. Effect of the delay in Clone’s costs recovery occasioned by Players set aside proceedings 359 As appears from the chronology, following the confirmation of Vanstone J’s original judgment by the High Court on 10 November 2006, Clone commenced the recovery of its costs. Further processes, including court hearings, continued, a short form and then a long form bill were filed, and then the taxation of costs commenced before Judge Withers, the initial taxing officer, progressing through to 2010. 360 However, on 17 December 2010 Players applied for a re-trial of these proceedings and they issued fresh proceedings to set aside the judgment, alleging malpractice. These proceedings resulted in a long adjournment of the taxation, which was delayed for several years, while multiple appeals and hearings including a second trial were held. It was not until 21 March 2018 when the High Court allowed Clone’s appeal, set aside the orders of Hargrave AJ, and reinstated Vanstone J’s orders that Players pay Clone’s costs, that the taxation was resumed. -- 71 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 70 361 In its submissions Clone seeks the payment of interest continuing from the date of payment of each interim invoice rendered by its former lawyers until the present day, including this long delay occasioned by the set aside proceedings, and based on the compensatory principle. It has emphasised this delay in paragraphs 14 and 47 to 50 of its written submissions, referring also to the orders made by Hargrave AJ requiring a repayment to Players by Clone in consequence of the set aside orders. It submits that the Stage 1 ruling in Reasons (No 14), which incorporates interest running from the date of payment of its lawyers’ invoices, should be continued into effect until the present time, and that the long delay was substantially contributed to by Players unsuccessful set aside proceedings. 362 Players have also addressed the effect of the set aside proceedings in paragraphs 104 to 108 of their submissions. They contend that this delay is irrelevant to the significance of the costs offers, because had Clone accepted the solicitors’ fees and disbursements offers, it would not be kept out of its money by reason of any subsequent delay in the determination of the proceedings after that date. 363 They address, however the question of what if any orders could and would have been made by Hargrave AJ in the set aside proceedings relating to such compromises (agreements) had they been made. Clone had assumed that Hargrave AJ could and would have required it to refund the monies under those offers (plus interest for the seven years during which Players had not had use of the money), and on this scenario it might be assumed that it would have been kept out of its solicitors’ fees and disbursements only, for a period of three years between 2015 and 2018, the High Court having overturned the set aside judgment and Players having refunded all the monies received from Clone back to it. 364 However, they say, this should not mean that Clone was at least entitled to interest for the three years between 2015 and 2018 during which it may have been kept out of its costs offer money. This is because in 2018, when Players refunded monies to Clone, they included a payment of interest thereon, by agreement. Accordingly, it could be assumed that they would have done the same in refunding any monies paid to Clone under the costs offers. Thus, even if orders had been made by Hargrave AJ relating to cost orders following any acceptance of the offers, Clone would not ultimately have been kept out of its money, because its position would have been fully restored in 2018, as was the case with the costs monies it had paid to Players in 2015. 365 Players conclude that what had occurred in 2015 as a result of Hargrave AJs orders, and what subsequently occurred in 2018 as a result of the High Court’s orders, was that the “round robin” repayments merely resulted in the status quo ante being restored in 2018, with the addition of interest made on those payments by them. Accordingly, in net monetary terms, the result was as if the repayments had never occurred in the first place, and the same would have occurred had Clone accepted Players offers relating to solicitors’ fees and disbursements. In these circumstances, Clone would not have been kept out of its money had it accepted -- 72 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 71 the costs offers, notwithstanding the set aside proceedings. Accordingly, Players submit, the “round robin” repayments did not support Clone’s submission that it is entitled to interest on costs relating to solicitors’ fees and disbursements in the period after the costs offers of 20 February 2008. 366 These matters were further canvassed in counsel’s oral submissions. 367 In Mr Roberts’ oral address he noted that in Reasons (No 14) at [160], I had already found that Players delay was a foundation for the award of interest, reiterating that any non-payment of interest would reward Players for the long delay thereafter, and would punish Clone for not having had its money. Even if Players offers had been bettered, or unreasonably refused, when this was weighed in terms of the mix of the delay and period after they were made, this should not warrant the deprivation of interest on its costs in the circumstances of the case. Again, he emphasised that the set aside proceedings were highly relevant, because in the course of these proceedings Hargrave AJ had ordered Clone to refund all monies paid by Players relating to both the trial and the initial Full Court appeal, together with interest. Clone had in consequence refunded $274,882.09 to Players. However, when in 2018 following the High Court judgment these orders were overturned, the original allocaturs in Clone’s favour were reinstated, and Players had returned the refunded amount, plus interest to the date of refund, to Clone. 368 He contended that even if Clone had accepted Players offers in 2008, the fact was that by reason of the set aside proceedings it would not have received interest until 2018. There was every reason for it to be compensated by an interest award for not having the use of its money. 369 In Mr Zappia’s oral address he submitted that had the offers made on 20 February 2008 been accepted then it would not really matter how long the proceedings went after that, as Clone would not have been kept out of its money, save for one qualification. This was that if Hargrave AJ, in setting aside the judgment, had made similar orders to those which he had made in respect of moneys which had been paid over, then this would have not changed the position. 370 What had occurred was that in consequence of Hargrave AJ’s orders, Clone had handed back money to Players in 2015, so it was accordingly kept out of that money for three years. However, in 2018 following the High Court’s orders, that money was repaid back to Clone by Players, including, in addition, interest as agreed between the parties. Accordingly, one could assume (although this would necessarily be speculating), the same treatment would have occurred, in exactly the same manner, in relation to any offers accepted by Clone, had Hargrave AJ determined that those offers should likewise be set aside and refunds made. 371 In considering these submissions, I have regard to the authorities in relation to interest on costs including Burford v Allan (Full Court) where Doyle CJ wrote that all sorts of matters could be relevant to the question of interest, Hunt v R M -- 73 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 72 Douglas (Roofing) Ltd76 where Lord Ackner observed that if interest was not payable on costs between judgment and the completion of the taxation there would be an incentive to delay payment, and Minister Administering the Environmental Planning and Assessment Act 1979 v Carson77 where Young A-JA law wrote that interest was a compensation for delay. 372 In Osborne v Kelly account was taken of the delays in payment of the amounts payable under the interim allocaturs, and interest was awarded on the basis of an unjustifiable delay in making payments to the plaintiff on account of costs once the defendant was in possession of a bill in taxable form. 373 However, in the present case (other than in respect of counsel fees, where Players offer was inadequate), the delay in Clone’s recovery of payments for solicitors’ fees and disbursements cannot be sheeted home to Players, as in accordance with my findings, both of Players offers for these two components were adequate. 374 Clone was kept out of its money by its own disentitling conduct in not accepting these offers, so the compensatory principle which stands behind the rationale for the award of interest on costs does not apply with respect to those components. 375 As Mr Zappia has submitted, had Players offers for solicitors’ fees and disbursements made on 20 February 2008 been accepted by Clone, then it would not really matter how long the proceedings went on after that, as it would not have been kept out of its money. 376 The only qualification to this would have been had Hargrave AJ, in setting aside the judgment, made similar orders to those which he had made in respect of other moneys which had been paid over to Clone. What had in fact occurred as a result of the set aside proceedings trial was that in consequence of the orders made after the conclusion of that trial, Clone had handed back money to Players in 2015 (as indicated in Clone’s submissions at paragraph 49.1, these moneys appear to be a mixture both in relation to both the trial and the 2006 Full Court appeal). It was accordingly kept out of that money for three years. However, in 2018 following the High Court’s orders, it was repaid back to Clone by Players, including, in addition, interest as agreed between the parties. Although necessarily speculative, the same treatment would presumably have occurred, in exactly the same manner, in relation to any money paid to Clone following acceptance of Players offers, had Hargrave AJ determined that those payments should likewise be set aside and refunds made. Clone would have been refunded its moneys, together with interest, covering that period. 76 [1990] 1 AC 398. 77 35 NSWLR 342. -- 74 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 73 The consequences of Clone’s not accepting Players solicitors’ fees and disbursements offers 377 Players have argued that had Clone accepted their solicitors’ fees offer, which was markedly greater than it recovered, and the disbursements offer, which came arithmetically close to what it recovered (but which I have found to be adequate), then the very lengthy taxation which has extended over several years would clearly have been considerably shortened, because such acceptance would have eliminated from the taxation by far the largest component of the claim, the solicitors’ fees, both in terms of the number of items, the monetary amount, and the time taken. Clearly, the taxation of solicitors’ fees took up by far most the time spent during that hearing. 378 In response, Clone submitted that this proposition was not open for Players to contend, and that it was manifestly unsafe. The fact was that the taxation proceeded in a mixed way, and that the establishment of many counsel fee items had occurred by reference to the taxation of solicitors’ fees components, and vice versa. The integrated way in which the whole taxation unfolded meant that it would have been impossible to dissect or safely conclude what any shortening process would be, if there could indeed have been any. 379 I have considered these submissions. I first address Clone’s submission that because the taxation proceeded in a mixed way, the establishment of many counsel fee items would need to have been decided by reference to the taxation of solicitors’ fees components, and vice versa, so that it would be impossible to dissect or safely conclude what any shortening process would be. 380 However, in my experience as a taxing officer the assessment of counsel fees (and disbursements) is a relatively simplistic process. Frequently, the three components of a claim for costs are taxed in sequence, rather than concurrently, and to a large extent that is what has occurred in this taxation. Indeed, by reason of the provision by Clone of its counsel fee accounts as a supplement to its long form bill, these were used on their face to allow, disallow, or reduce the amounts claimed. This process occurred during the later stages of the taxation. 381 On occasions, it becomes necessary when taxing a counsel fee or disbursement to examine and consider the corresponding solicitors’ fee description or charge, but that is not a difficult process. Clone’s long form bill was comprehensive and detailed (as was the short form bill) and it was before the court throughout the taxation, so even had solicitors’ fees been settled, the details would have been available to the Court and counsel for reference during any taxation of counsel fees only. 382 Further, and significantly, for the Court to require a full taxation of all components of the claim merely to facilitate the taxation of only counsel fees would have imposed a significant, costly and wasteful burden on both the Court and the parties. -- 75 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 74 383 I next consider Players submission that had Clone accepted their solicitors’ fees offer on 20 February 2008, the taxation thereafter, being confined to disbursements and counsel fees only (or counsel fees only), would have been shortened to a very large extent. 384 I also accept this submission. The consequence would inevitably have been that such a taxation would have considerably shortened in its length and duration. In consequence, as a result this would have greatly diminished Clone’s interest entitlement, because it could not then complain that it had been kept out of its money during the time taken to tax the bill. The time remaining would have been confined to counsel fees and disbursements only, or counsel fees only. The length of this time will be necessarily a matter of conjecture, but I am able both to look at the court record of what occurred, and to rely on my own experience as a taxing officer in making an estimate of this. 385 The Court record establishes the progress of the taxation from when it commenced before Master Withers in 2008 until the date of the set aside proceedings, and then resumed before myself on 4 March 2019 and continued until 2025 and continuing this year. 386 I have examined Clone’s long form bill, the subject of the taxation. It contains 6009 items in 2 volumes. Of these, only 36 relate to counsel fees and 267 to disbursements (of which the substantial majority of the latter were relatively small in amount), totalling 303 items for both counsel fees and disbursements. The separate counsel fee accounts schedules only comprise 50 pages, several of which are very short. 387 There is a Court record of the taxation before Master Withers from the filing of the long form bill by Clone on 27 March 2008 onwards. This was followed by multiple hearings thereafter, which continued sporadically until the set aside proceedings were instituted in December 2010. From the record it is difficult to identify the specific dates of the taxation hearings, as other related matters were proceeding concurrently. However, during the period when Master Withers was assessing the costs, he taxed close to 639 items - a number considerably exceeding the total number claimed for both counsel fees and disbursements. He disallowed or reduced 256 items relating to solicitors’ fees and 3 items of counsel fees. He also determined, as a general issue, the charging rates fixed for counsel. 388 I taxed the remainder of the bill, including most of the solicitors’ items and the majority, if not all, of the counsel fees and disbursements. 389 From my own records and from the Court file, which includes transcripts of the taxation on some occasions, I note that following the conclusion of the taxation of solicitors’ fees in late August 2023, the taxation of Clone’s counsel fees commenced on 7 November 2023. It continued on 8 November 2023, resuming with all day hearings on 6 May 2024, 7 May 2024, and 24 July 2024, with shorter -- 76 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 75 (one hour or so) hearings on 13 February 2024, 14 February 2024, 27 February 2024, and 8 May 2024, totalling about 6 days of hearings, albeit over a few months. 390 Some of the counsel fees were large in quantum (for example, item 4597, a counsel fee of Mr McNamara, totalled $48,400), but most took not long to tax. One detailed argument was heard on counsel fees (Clone Pty Ltd v Players Pty Ltd (No 10))78 involving an assertion by Players that counsel fees in general should be reduced by reason of an allegation as to “serious malpractice” (this did not succeed). A further argument related to a claim for preparation time by counsel, but this was resolved expeditiously- it was argued in early May 2024 and my reasons were delivered on 29 May 2024. 391 In relation to disbursements, I note that of the 267 items claimed, the large majority (155 items) related to courier fees (each of only about $5, all appear to have been allowed), and of the remainder, only 50 or so exceeded $100 in amount (a limited number were for larger amounts). 392 The remaining 5707 items all related to solicitors’ charges. These occupied most of the very long time expended on the taxation. I have examined the various published rulings I gave during the taxation, commencing in March 2019 and continuing to 24 September 2024 (prior to the present arguments concerning interest on costs). Of the 13 published reasons during this period, only two or three substantially related to issues other than solicitors’ fees. The large majority of the minor, and substantial, arguments during the taxation were confined to claims for solicitors’ fees. 393 In hindsight, a taxation of counsel fees and disbursements at the outset would have been preferable. However, this is not what occurred. Clone’s bill of costs was taxed in its entirety, largely in chronological sequence, by both Master Withers at the outset, and then before myself. With some limited exceptions, the Court was not asked to tax the counsel fees and disbursements first. The Court was unaware, of course, during the taxation of the fact of offers having been made, or of their amounts. Summary of findings as to the matters argued by the parties 1. The delay by Clone in the formulation of it claim for costs was earlier raised by Players as a disentitling factor. Although there was a considerable delay by Clone in the institution of its claim for costs, its bill was lengthy, and in any event any delay was taken into account in Stage 1 of the interest assessment, as has been acknowledged by Players. It is unnecessary, accordingly, to consider this issue as part of the present stage. 2. Players cost offers were compliant with the rules. They made clear, in explicit terms, that they were offers made under the rules. There could be no reasonable doubt about the consequences of their acceptance. Having 78 [2024] SASC 72. -- 77 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 76 regard to the background history they dealt with the issue of Clone’s claimed costs of the taxation and were valid as to the date for service under the rules. 3. The fact that the interest component of the offers might have been made as a gross sum rather than as fixed by the Court did not invalidate the offers. This issue only goes to whether or not the offers were reasonable or adequate. 4. Clone’s submission that Players offers for the three components of costs was non-compliant with the rules because they did not specifically provide for its costs of taxation is rejected. Clone’s short form claim for costs specifically included a component relating to the drawing of its bill of costs. Players offer specifically responded to this, they having been provided with no further information from Clone as to what such costs were or might have been. 5. Further, Clone failed to raise this issue or notify Players of any such omission following receipt of the offers. Nor has it ever done so prior to the present arguments. Nor has it ever quantified these costs despite submitting that they are substantial. Further, there is evidence from Clone’s solicitor, Mr Hamilton, that at the time, Clone was endeavouring to keep its costs to a minimum. 6. Even were Players offers to be non-compliant with the rules, they could still have effect. Notwithstanding any procedural irregularity the Court has a discretion to waive such irregularity under rule 12, and a dispensation is permitted under rule 117(2)(a). Insofar as it may be necessary, it is appropriate to grant such a dispensation as it is in the interests of justice for settlement offers to be given proper effect. 7. Although it is unnecessary to decide in the light of the above findings, I reject Players submission that the acceptance by Clone of its offers would constitute a binding contract. 8. It is appropriate and relevant to consider the effect of Players offers in regard to Clone’s interest on costs claim. 9. Clone’s submission that the case law indicates that “bundled” offers combining both principal and costs cannot have effect is rejected. The case law referred to is distinguishable because it relates to bundled offers for a judgment and costs. Players offers relate to cost claims and the costs of taxation of those claims, which is a different situation. In these circumstances the effect of the offers are all determined by the taxing officer instead of by a trial judge and a taxing officer. 10. Further, there is other authority that bundled offers can have effect, as referred to in Elite Protective Personnel Pty Ltd & Anor v Salmon. -- 78 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 77 11. Despite Clone’s submission that Players offers lapsed by reason of Players set aside proceedings, the rules make no provision as to offers lapsing and there is case law contrary to this submission. 12. Multiple offers for costs are permitted by the rules. Separate offers may be made and considered individually. There is good reason for this to be permitted, as these facilitate settlement which is the intent and purpose of the rules and is in the interest of both the Court and the parties. They likewise facilitate the shortening of, and accordingly the costs, of a taxation. 13. Clone’s submission that multiple offers should not be permitted because a taxation of counsel fees should not be isolated from the solicitors’ fee component is rejected. To require the taxation of counsel fees and disbursements concurrently with solicitors’ fees would be unnecessary, wasteful and expensive for both the parties and the Court. 14. Where multiple offers are made for different components of a bill of costs the results of the offers should be considered separately, rather than in aggregate. Likewise, this facilitates settlement. 15. Because Players bettered their offer to Clone for its solicitors’ fees this is appropriate to be taken into account as a disentitling factor in the award of interest to Clone. 16. Players disbursement offer was substantially higher than the awarded amount for Clone’s disbursements, and although by reason of the addition of interest awarded in Stage 1 Clone recovered arithmetically more than the total of the offer, in the whole of the circumstances the offer was nevertheless adequate, and it is appropriate be taken into consideration as a disentitling factor in the award of interest to Clone. 17. Players counsel fees offer was “bettered” by Clone, both with and without the interest component, so accordingly Clone is entitled to interest on those fees, however subject to further relevant factors. 18. As has been considered, there was delay caused in the taxation process by reason of inadequate record keeping and/or inability to substantiate items by Clone. This should be taken into account as a disentitling factor in the assessment of its interest award. 19. Further, and significantly, in the assessment of Clone’s interest entitlement, in consequence of its non-acceptance of Players solicitors’ fees and disbursements offers, the taxation of its costs occupied a greatly extended period, substantially longer that would otherwise have been the case. Had these offers been accepted by Clone this would have very substantially shortened the length of time taken for the taxation. This will be taken into account in the Court’s overall assessment of Clone’s interest on its claim. -- 79 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 78 20. Players set aside proceedings caused a long delay in the progress of the taxation. However, the fact is that had Players offers for solicitors’ fees and disbursements been accepted when they were made, then it would not have mattered how long the proceedings continued thereafter, because Clone would not have been kept out of its money with respect to those components. 21. Had Players offers or any of them been accepted by Clone, then having regard to what occurred in the set aside proceedings Clone would not have been disadvantaged. After the set aside proceedings were heard and determined, Clone was ordered to repay moneys to Players, and did so, including costs. This order was later reversed, following the High Court judgment, and Players repaid these monies, together with agreed interest. Although it is necessarily speculative, had Clone accepted Players offers and then been paid, then a repayment to Players would be consistent with the other orders Hargrave AJ had made. Likewise, a refund to Clone, with interest, following the High Court judgment would no doubt have occurred. 22. Had Clone accepted Players solicitors’ fees and disbursements offers, the taxation of its costs would have concluded much earlier than it did, reducing its interest entitlement. 23. Having regard to the multiplicity and complexity of the factors relevant to fixing the interest on Clone’s costs in Stage 2, as analysed above, and in accordance with the observations of Doyle CJ in Osborne v Kelly at [68] it is appropriate to assess this interest in a lump sum. Evidence as to Players offers and their effectiveness 394 The parties have provided a summary of the evidence relating to the effectiveness of Players offers. Solicitors’ fees 395 Clone’s claim for solicitors’ fees was $377,711.85. With respect to these, Players solicitors’ fees offer (including interest) was $265,000. The amount allowed to Clone on the taxation for solicitors’ fees was $207,826.77 (exclusive of interest). This was a very substantial reduction from its claim, and was presumably the basis of Mr Zappia’s assertion that there was an overreach by Clone. The proportion of the Court’s $125,000 lump sum interest award attributable to Clone’s solicitors’ fees, based upon an application of the methodology of Reasons (No 15) was $41,207.68, providing a total award to Clone for solicitors’ fees, inclusive of interest, of $249,034.45. In these circumstances Players “bettered” their solicitors’ fees offer of $265,000 - by the amount of $15,965.55, after taking this into consideration. 396 Accordingly, the Court determined the proceedings relating to Clone’s solicitors’ fees claim on the taxation in terms that were “no more favourable” to -- 80 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 79 Clone than the terms of Players solicitors’ fees offer within the meaning of rule 188(8). Disbursements 397 Clone’s claim for disbursements (other than counsel fees) was $134,378.20. Players disbursements offer (including interest) was $115,000. The amount allowed to Clone on the taxation for disbursements was $98,431.51 (exclusive of interest). This was a substantial reduction from the claim, a difference of $16,568.49. The proportion of the Court’s $125,000 lump sum interest award attributable to Clone’s disbursements was $19,516.90, providing a total award to Clone for disbursements, inclusive of interest, of $117,948.41, which was $2,948.41 greater than Players offer. 398 Although arithmetically the Court therefore determined the proceedings relating to Clone’s disbursements claim in an amount greater than Players disbursements offer, in my view in all the circumstances, Clone ought to have accepted Players disbursements offer. In my view it was an adequate offer having regard to the difference between the amount of the claim and the amount awarded. Had Clone promptly accepted this offer, it would have received $134,378.20 for disbursements. In fact, it only eventually recovered $98,431.51, excluding interest. Notwithstanding its interest award, it only “bettered” Players offer by $2,948.41. The offer, although arithmetically beaten, was adequate. Counsel fees 399 Clone’s claim for counsel fees was $414,472.30. Players counsel fees offer (including interest) was $295,000. The amount allowed to Clone on the taxation (exclusive of interest) was $324,166.53. The amount taxed off was $90,305.77, a substantial figure. The proportion of the Court’s $125,000 lump sum interest award attributable to Clone’s counsel fees however was $64,275.41, providing a total award to Clone for counsel fees, inclusive of interest, of $388,441.94, which was $93,441.94 greater than Players offer. The Court accordingly determined the proceedings relating to Clone’s counsel fee claim on the taxation, in terms that were “more favourable’ to Clone than the terms of Players offer within the meaning of rule 188(8). Submissions of the parties’ as to Clone’s interest entitlement 400 The parties have lodged extensive written and oral submissions and have provided a number written calculations as to the interest which they contend should be awarded to Clone. 401 Clone’s calculations are contained in the Schedule 1 attached to its written submissions. These are premised on its submissions that the interest should be awarded on all three components of its costs, commencing from 1 December 2008 and continuing until 11 February 2026, the date of the argument. The Schedule identifies 24 discrete time periods identifying the start and end dates, the then outstanding costs, the applicable post judgment Court interest rates (both under the -- 81 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 80 2006 rules and the Uniform Civil Rules), the number of days for each period, and the interest component. 402 Clone’s total interest claim is $724,712.59 calculated by adding the interest from 1 December 2008 to 11 February 2026, namely $582,680.58 to the interest accruing from the date of interim payments until 30 November 2008 (as detailed in its submissions of 2 May 2026 which are not disputed, namely $142,032.01). 403 Players calculations within their written submissions are premised on their liability to pay interest on Clone’s counsel fees (only). They are set out in the attached Schedule 1. As with Clone’s submissions, this Schedule covers the period commencing 1 December 2008 and continuing to 11 February 2026, and likewise these include 24 discrete time periods identifying the start and end dates, the then outstanding costs, the applicable post judgment Court interest rates (both under the 2006 rules and the Uniform Civil Rules) the number of days for each period, and the interest component, which totals $227,115. The Schedule factors in reduced principal amounts by reason of payments of interim allocaturs on 1 July 2009 and 2 October 2018. It also adds a component of interest accrued to 30 November 2008 on Clone’s counsel fees as detailed in Schedule 1 to Clone’s submissions dated 2 May 2025 (referring to Reasons No 14 at [29]) in the sum of $79,167, leading to a total interest calculation of $306,282 being the total of $227,115 and $79,167. 404 During Mr Zappia’s oral submissions, he tabled a Summary of three different potential interest scenarios for use at the second stage hearing. These related to counsel fees (only), counsel fees and disbursements (only) and the total interest on costs as set out in these three annexures. 405 Scenario 1, counsel fees only, provided a total interest figure from 1 December 2008 to 11 February 2026 of $227,115 plus the $125,000 lump sum award, totalling $352,115. 406 Scenario 2, counsel fees and disbursements only, provided a total interest figure from 1 December 2008 to 11 February 2026 of $314,127 plus the $125,000 lump sum award, totalling $439,127. 407 Scenario 3, total interest on costs, provided a total interest figure from 1 December 2008 to 11 February 2026 of $582,680.58 plus the $125,000 lump sum award, totalling $707,680. 408 Mr Zappia submitted (T59.14-24) that the above Counsel fees only table used essentially the same integers that Clone had used in the annexure to its written submissions, the only difference was that this had inserted the interest awarded by way of a lump sum at the bottom (being the court’s lump sum award of $125,000). They were figures arithmetically calculated using the same integers that Clone had used. 409 Mr Roberts responded. In his submissions at T26.10-31 as to these three scenarios tabled by Mr Zappia, he indicated that there were errors in relation to the -- 82 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 81 counsel fees only component. Players had commenced their interest calculations in January 2009 basing these on the Stage 1, $125,000 lump sum interest award. The Court had not dealt with this calculation on the basis that it meant to 31 December 2008 - on the contrary it was based on an award up and until two months after the date of the offers. Accordingly, Players had in round figures deducted six months’ worth of interest at the beginning. 410 Secondly, he said, the allocatur paid on 2 October 2018 had been applied in Players counsel fees table solely for that component of Clone’s costs, rather than on a pro-rata basis over all three categories, which they should have done. This was so because Players had recognized that the interest on Clone’s counsel fees was their worse point. There was no basis for their doing so. 411 Both of these propositions were incorrect and I will pay regard to this. 412 Further, Mr Roberts at T70.2-19, again referred to the application of the $125,000 interest, pointing out that this related solely to the counsel fees. He said this was because it was a device to try to reduce the figure said to be the one where Players were conceding the greatest exposure. In fact, the $125,000 interest dealt with all three claims up to the point where the offer was made. There was no basis for this style of selective application for counsel fees, and there was a material vice in these calculations. 413 I acknowledge Mr Roberts’ submissions on these matters, and have had regard to them. The assessment of Clone’s interest as a lump sum 414 As in the case of Stage 1, I have determined that it is appropriate to assess Clone’s interest entitlement following the date of the offers as a lump sum. As discussed above, in Osborne v Kelly79 at [68], Doyle CJ wrote that adjusting interest was in many circumstances a rather crude device, and that it was undesirable that a question of interest should give rise to lengthy argument about the selection of a date which would fairly compensate a plaintiff. The power to award a lump sum would inject flexibility into the process. 415 As has been summarised above, there are numerous considerations which need to be taken into account in fixing the figure. 416 I have had regard to each of them. 417 These include the long period between the award of costs and the conclusion of the taxation. 418 However, there are other, in my view significant, factors. 79 (1999) 75 SASR 392. -- 83 of 84 -- [2026] SASC 96 Auxiliary Associate Justice Norman 82 419 I have concluded that Players solicitors’ fees and their disbursements offers were both adequate. However, despite this, they were not accepted by Clone. In consequence, only counsel fees would have been required to be taxed. This would have led to a very greatly shortened process, more likely taking months from the date of the offers rather than years to finalise. This would have substantially reduced the period over which interest would run. Had these offers been accepted by Clone, it would have been kept out of its money for a greatly reduced period. 420 Clone’s inadequate record keeping and/or inability to substantiate costs records delayed the taxation on many occasions. This should also be taken into account as a disentitling factor in the assessment of its interest award. 421 Stage 1 interest was awarded in the sum of $125,000. 422 Taking all these matters into consideration, I award Stage 2 interest to Clone in the global sum of $225,000. Summary of Orders 1. I assess interest on Clone’s costs for the Stage 2 period in the global sum of $225,000. 2. Insofar as may be necessary, if Players costs offers were non-compliant with the rules, then pursuant to 2006 rule 117(2)(a), I dispense with any procedural irregularity thereof nunc pro tunc. 3. I direct the parties to contact the Court within 21 days of the delivery of these reasons to provide suitable availability dates for the next directions hearing, or an agreed program for the further hearing of this matter. -- 84 of 84 --