The utility of offers of compromise in Class 3 compensation proceedings

On 13 March 2014, the NSW Land and Environment Court dismissed a costs application made by the acquiring authority, Sydney Water Corporation (SWC), following the Court's determination of the substantive Class 3 proceedings: Tempe Recreation Reserve Trust v Sydney Water Corporation (No 2) [2014] NSWLEC 23. In particular, the costs application sought an order that the dispossessed landowner, Tempe Recreation Reserve Trust, pay SWC's costs of the proceedings on an indemnity basis from the day after SWC's offer of compromise.

Despite the fact that SWC's offer of compromise had the "hallmarks of compliance" with rule 20.26 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) and was a genuine offer, the Court held that SWC was not entitled to its costs on an indemnity basis under rule 42.15 because the Court's determination was not "less favourable" to the Trust than the terms of the offer. If the Court was in error and rule 42.15 was in fact engaged, the