148 Brunswick Street Pty Ltd v 5G Network Operations Pty Ltd (No 2) [2026] QSC 107

SUPREME COURT OF QUEENSLAND CITATION: 148 Brunswick Street Pty Ltd v 5G Network Operations Pty Ltd (No 2) [2026] QSC 107 PARTIES: 148 BRUNSWICK STREET PTY LTD AS TRUSTEE FOR THE 148 BRUNSWICK STREET DISCRETIONARY TRUST ACN 117 914 664 (applicant) v 5G NETWORK OPERATIONS PTY LTD ACN 620 305 393 (respondent) FILE NO/S: BS No 4573 of 2025 DIVISION: Trial Division PROCEEDING: Originating Application ORIGINATING COURT: Supreme Court at Brisbane DELIVERED ON: 4 June 2026 DELIVERED AT: Brisbane HEARING DATE: On the papers JUDGE: McCafferty J ORDER: 1. The applicant must pay the respondent’s costs of the proceeding up to and including 18 November 2025 on the standard basis. 2. The applicant must pay the respondent’s costs of the proceeding after 18 November 2025 on the indemnity basis. CATCHWORDS: PROCEDURE — CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS — COSTS — OFFERS OF COMPROMISE, PAYMENTS INTO COURT AND SETTLEMENTS — INFORMAL OFFERS AND CALDERBANK LETTERS — where the applicant’s originating application was dismissed — where the respondent made a series of offers to settle throughout the course of the proceeding, three of which were Calderbank offers — whether the applicant’s rejection of the earliest Calderbank offer was unreasonable — whether departure from the general costs rule is warranted in the circumstances Corporations Act 2001 (Cth), s 459P Uniform Civil Procedure Rules 1999 (Qld), r 698 -- 1 of 6 -- 2 148 Brunswick Street Pty Ltd v 5G Network Operations Pty Ltd [2026] QSC 76, related Calderbank v Calderbank [1975] 3 All ER 333, cited Stoyle v Govita Agencies Pty Ltd [2019] QSC 62, cited Todrell Pty Ltd v Finch; Croydon Capital Pty Ltd v Todrell Pty Ltd [2007] QSC 386, cited Wiggins Island Coal Export Terminal Pty Ltd v Civil Mining & Construction Pty Ltd (2021) 7 QR 1; [2021] QCA 8, cited COUNSEL: C J Jennings KC with A L Morrow for the applicant E J Goodwin KC for the respondent SOLICITORS: PHV Law for the applicant AJ & Co Lawyers for the respondent Introduction [1] On 22 April 2026, I made orders dismissing the applicant’s amended originating application and indicated that I would hear the parties as to costs.1 The parties have subsequently filed costs submissions. Position on costs [2] The parties’ respective positions on costs are as follows. [3] The respondent (5GNO) seeks an order for indemnity costs (of the proceedings, or, alternatively from 18 November 2025) on two bases. First, that the applicant unreasonably refused one or more Calderbank offers made by 5GNO. Second, because the applicant filed its application without seeking leave under s 459P of the Corporations Act 2001 (Cth) (Corporations Act) in circumstances where it should have known leave was required and would not be granted. [4] The applicant, with one exception, submits that the general costs rule should apply, and that it should pay 5GNO’s costs on the standard basis. The exception is the costs of the hearing which was adjourned on 29 January 2026. For this outing, the costs of which were reserved, the applicant submits that it should have its costs on the standard basis. The reason for this is that the adjournment was necessitated because of the late provision of material by 5GNO. Background [5] The proceeding was commenced on 9 October 2025. As I indicated in my reasons, as filed, the application sought orders winding up 5GNO in deemed insolvency under s 459C of the Corporations Act for a failure by 5GNO to respond to a statutory demand relating to the disputed debt. [6] That position subsequently changed. On the day of the hearing, the applicant made an oral application to amend the application to seek leave under s 459P. That 1 148 Brunswick Street Pty Ltd v 5G Network Operations Pty Ltd [2026] QSC 76 (reasons). -- 2 of 6 -- 3 application had been foreshadowed, but not made, in written submissions filed in January 2026 prior to the adjournment of the hearing.2 [7] It was not in issue that the only basis upon which the applicant was eligible to seek leave under s 459P for orders that 5GNO be wound up was the Costs Order referred to in my reasons. 5GNO indicated that it did not oppose the leave, subject to the payment of costs thrown away. Leave to amend was granted in effect on this basis. Offer(s) [8] 5GNO’s solicitors made various attempts to resolve the proceedings. The earliest known attempts were two letters sent on an open basis shortly after the application was filed. It is not suggested that these two letters, dated 17 and 24 October 2025, engaged the principles from Calderbank. That would be a difficult proposition to maintain in the absence of something manifesting an intention to rely on the correspondence to seek something other than the usual order for costs.3 [9] The first proper offer was made on 18 November 2025. This offer was made on a without prejudice basis (18 November offer). There is no dispute this offer was a Calderbank offer. Broadly speaking, it asserted that 5GNO would oppose the application, at a time when it still relied upon the presumption of insolvency under s 459C, on the basis that: (i) 5GNO is solvent; (ii) the applicant cannot rely on the presumption of insolvency; (iii) the debt claimed is subject to a genuine dispute; and (iv) the statutory demand is defective. [10] Each of these grounds was expanded upon in the body of the offer. It is unnecessary to reproduce all aspects of these grounds. But there is one which 5GNO places reliance upon: the detailed explanation as to why, in 5GNO’s view, the applicant could not rely on the presumption of insolvency. [11] As to this, the 18 November offer contained the following: “9. The presumption of insolvency under section 459C(2) of the Act, which starts the 3-month clock to commence a winding up proceeding arises, among other things, when a company has failed (as defined in section 459F) to comply with a statutory demand. The period for compliance is prescribed by section 459F in the following terms: (a) if an application is made in accordance with section 459G and the Court makes an order that extends the period for compliance, then the period as ordered or, otherwise, the period beginning on the day the demand is served and ending 7 days after the application under section 459G is determined or disposed of (section 459F(2)(a)); or (b) the statutory period for compliance (being the 21 days after service of the statutory demand) (section 459F(2)(b). 10. [5GNO’s] Originating Process filed in the Supreme Court of Victoria … (Set Aside Application) does not fall within section 459F(2)(a) of the Act 2 Paragraph 8 of the reasons contains an incorrect reference to 2025. 3 Wiggins Island Coal Export Terminal Pty Ltd v Civil Mining & Construction Pty Ltd (2021) 7 QR 1 at [68]. -- 3 of 6 -- 4 because it was served out of time … Accordingly, for the purpose of section 459F, the Set Aside Application was not ‘an application made in accordance with section 459G’. 11. In Golden Plantation Ltd v TQM Design & Construct Pty Ltd [2010] NSW 1453, the Supreme Court of New South Wales held that only an application made in accordance with section 459G may enliven extensions of periods for compliance with statutory demands under section 459F(2)(a). Where a section 459G application is irregular or defective, then section 459F(2)(b) fixes the time for compliance, being 21 days after service of the demand. 12. Accordingly, your client cannot rely on section 459F(2)(a) in order to provide a three-month period after disposal of the Set Aside Application within which a winding up application relying upon a statutory presumption of insolvency under section 459C could be filed.” [12] The ultimate terms of the 18 November offer were expressed as follows: “16. For the reasons detailed above, our client is confident of its position. Nonetheless, we are instructed to make the following offer of settlement, in the interests of a commercial resolution that avoids the incurrence of further costs: (a) the parties seek that the Application be dismissed by consent; (b) each party bear their own costs (Offer). 17. The Offer is open for acceptance in writing until 5.00pm on 2 December 2025.” [13] The 18 November offer was not responded to, and it lapsed accordingly. [14] 5GNO made three further Calderbank offers. It is unnecessary to set out the detail of these offers because ultimately, for the reasons that follow, I am satisfied that the applicant’s failure to accept the 18 November offer was unreasonable. Principles [15] The rejection of a Calderbank offer does not give rise to a presumption that the offeree is to pay the offeror’s costs on the indemnity basis. The principled approach is to consider whether the rejection, or failure to accept, the offer was unreasonable. This involves a matter of judgment and impression. But the court will, in assessing matters, ordinarily have regard to the following: 1. the stage of the proceeding at which the offer was received; 2. the time allowed to the offeree to consider the offer; 3. the extent of the compromise offered; 4. the offeree’s prospects of success, assessed as at the date of the offer; 5. the clarity with which the terms of the offer were expressed; and -- 4 of 6 -- 5 6. whether the offer foreshadowed an application for an indemnity costs order in the event of the offeree’s rejecting it. Consideration [16] The 18 November offer was sent the same day 5GNO filed and served the first report of Mr Connelly. This report opined that 5GNO was solvent. It was responsive to a report which the applicant had obtained from Mr Brennan which also expressed the opinion, albeit qualified, that 5GNO was solvent. Each of these experts provided further reports: Mr Brennan provided a supplementary report and Mr Connelly provided two further reports. [17] In consideration of the application of the principles to the exercise of discretion, the applicant contends that the 18 November offer was made at an early stage in the litigation, before it had the benefit of Mr Brennan’s supplementary report considering the opinions of Mr Connelly and before 5GNO had provided all its material. In these circumstances it is submitted that the failure to accept the offer was not unreasonable having regard to “the stage of the proceeding, the material then available to the applicant, and the applicant’s ability to then consider and deal with it.” [18] This submission does however overlook what in my mind is an important feature of this case. When the 18 November offer was made it ought to have been apparent to the applicant, not least because the offer identified why, that it could not rely upon the presumption of insolvency arising from the failure to respond to the statutory demand to seek the relief in the application. [19] This, in my view, is significant. The only basis upon which the application to wind up could have been maintained was to seek leave under s 459P. That leave was, as I have mentioned, eventually sought. However, as my reasons record, the only basis upon which the applicant was eligible to seek leave under s 459P was because it was a contingent creditor owed up to, but not more than, $70,000.4 [20] As to this, as I found, the disputed debt was, for the purposes of s 459P, to be disregarded. The difficulty for the applicant is that Mr Brennan, upon whose opinion emphasis is placed, considered that as at 9 October 2025, the date the application was filed, 5GNO was able to pay a debt of $70,000.5 Any supplementary opinion provided by Mr Brennan, with or without the benefit of further documents from 5GNO, did not alter this conclusion. [21] Even accepting that the 18 November offer was made at an early stage of the proceeding, and without the benefit of Mr Brennan’s supplementary report and 5GNO’s material, the point conveyed in the offer was a fundamental one: on no view could the applicant rely upon the presumption of insolvency. The fact that Mr Brennan’s evidence at the hearing was that 5GNO could pay the $70,000 underscores why the failure to accept the 18 November offer was unreasonable. [22] It follows that in all the circumstances this failure justifies a departure from the usual rule. 4 Reasons at [40]-[42]. 5 Reasons at [46]. -- 5 of 6 -- 6 [23] 5GNO’s primary position is that it is appropriate that the applicant pay indemnity costs for the proceeding. The basis for this submission is that the application should not have been run or persisted with by the applicant by reason of it being obvious that the presumption of insolvency was unavailable and 5GNO was solvent. In advancing this submission 5GNO relies upon the principles identified by Wilson J in Stoyle v Govita Agencies Pty Ltd6. [24] It may be accepted that within these principles is embraced the propositions that commencing proceedings for an ulterior motive, or which cannot succeed because of a known legal impediment or in wilful disregard of known facts or clearly established law are bases upon which indemnity costs may be warranted.7 [25] In my view, upon consideration of the matter, while it may readily be accepted that the applicant ought to have been aware that the presumption was not available, the awakening event from which this awareness should have arisen was the 18 November offer. It was persisting with the application after this time that was unreasonable. There is in my view an insufficient basis to conclude that there was some ulterior motive or improper purpose attached to pursuing the application. [26] It follows that the appropriate date from which indemnity costs ought to be paid is 18 November 2025. [27] The remaining issue for consideration is the costs that were reserved from the adjournment of the hearing on 29 January 2026. The applicant seeks its costs of this hearing on the standard basis by reason that the matter was adjourned following the late delivery of 5GNO’s evidence. That may well be the case. However, as events unfolded, further matters transpired from the applicant’s perspective that were not foreshadowed at the hearing on 29 January 2026: most notably, a proposal to amend the originating application to seek leave under s 459P, and, related to this, an abandonment of the reliance upon s 459C. Of course, to these matters may be added that ultimately the material provided in response to 5GNO’s evidence was not accepted. In these circumstances, in my view there is no reason why the reserved costs should not follow the event under UCPR r 698 and, in accordance with this rule, I decline to order otherwise. Conclusion [28] In the circumstances, I make the following orders: 1. The applicant must pay the respondent’s costs of the proceeding up to and including 18 November 2025 on the standard basis; 2. The applicant must pay the respondent’s costs of the proceeding after 18 November 2025 on the indemnity basis. 6 Stoyle v Govita Agencies Pty Ltd [2019] QSC 62. 7 See Todrell Pty Ltd v Finch; Croydon Capital Pty Ltd v Todrell Pty Ltd [2007] QSC 386 at [4]. -- 6 of 6 --