CA270580, Bares & 1735 Pty Ltd v NA286149 & NA286150: indemnity costs
Community Association DP 270580, Bares and 1735 Pty Ltd v Neighbourhood Association 286149 and Neighbourhood Association 286150 [No 2] [2026] NSWCATAP 292
In short
An unexplained 26-month delay, together with low or non-existent prospects of success, constituted special circumstances warranting a costs order.
The neighbourhood associations obtained ordinary costs to 27 January 2026 and indemnity costs thereafter.
Their Calderbank offers involved a genuine compromise, were timely and remained open for a reasonable period.
The community association was required to fund the costs through a special levy excluding both successful neighbourhood associations.
Background
The dispute arose in a riverside community scheme at Moama. The appellants were the community association, a corporate lot owner and two individuals with governance or ownership interests in that company. The respondents were two neighbourhood associations within the scheme.
The primary proceedings had been dismissed for want of prosecution on 8 August 2023, with costs ordered in favour of the neighbourhood associations. The appellants did not file their notice of appeal until 8 October 2025. On 29 April 2026, the Appeal Panel refused to extend time and said that it would also have refused leave and dismissed the appeal.
Decision
Section 60 of the Civil and Administrative Tribunal Act 2013 required special circumstances before costs could be awarded. The Appeal Panel found those circumstances in the extraordinary unexplained delay, the unreasonable prolongation of the proceedings and the appeal’s low prospects. The individuals and community association had no prospects because they lacked standing, while the corporate lot owner had not provided material supporting its case against both neighbourhood associations.
The respondents had made separate Calderbank offers on 26 January 2026. The Appeal Panel found that the offers involved a significant compromise, were made after the parties had exchanged material and allowed a reasonable period for consideration. Rejection of the offers was unreasonable.
Outcome
The appellants were ordered to pay the respondents’ costs on the ordinary basis up to 27 January 2026 and on the indemnity basis thereafter.
The Appeal Panel also noted that Community Association DP 270580 was obliged to comply with s 107 of the Community Land Management Act 2021. Under s 190, it ordered the community association to pay the costs from a special levy excluding Neighbourhood Association 286149 and Neighbourhood Association 286150.
