Update and refresher on offers of compromise in civil litigation

I recently presented a seminar to several audiences on offers of compromise under Order 26 of the Supreme Court (General Civil Procedure) Rules 2005, offers to settle under Order 25 of the Federal Court Rules 2011, and "Calderbank" offers under the common law.

The take-home message from this seminar is that the amendment to the offer of compromise rules in the Supreme Court of Victoria to allow cost inclusive offers (now consistent with the Federal Court Rules 2011) has made offers of compromise more attractive, and arguably better than "Calderbank" offers. This is particularly so when taking into account the onus of proof for each: an offeree for an offer of compromise needs to prove "special circumstances" that demonstrate why an offer of compromise should not apply, whereas an offeror needs to prove that it was unreasonable for the offeree to have rejected a "Calderbank" Offer. That is, it is much easier for an offeror to obtain a costs benefit from an offer of compromise than from a "Calderbank" Offer, where the offer has bettered the result.

I've included below the Slides from the seminar, embedded from Slideshare.

I hope you find the slides informative and helpful.

2015 amendment: Victorian Supreme Court Rules jettison old summary judgment test

As of 4 May 2015 the Supreme Court (General Civil Procedure) Rules 2005 were amended by the Supreme Court (Chapter I Summary Judgment Amendment) Rules 2015.

These amendments made important revisions to the Rules including:

• To revise Order 22 to facilitate the new test for summary judgment in Part 4.4 of the Civil Procedure Act 2010 ("no real prospects of success"), and to maintain most of the previous procedure for making application for summary judgment (that is, to show cause in response).
• To remove from the scope of Rule 23.01 ("Stay or Judgment in proceeding") the ground that a claim or defence does not disclose a cause of action.
• To revoke Rule 23.03 altogether, which provided for summary judgment where the defendant has a good defence on the merits.

The summary judgment amendment was necessary because of the uncertainty of the process of obtaining summary judgment under Part 4.4 of the Civil Procedure Act 2010, including the interaction of Part 4.4 with the previous Order 22. For instance, Part 4.4 contains no requirement for a responding affidavit to show cause, nor does it require a particular standard of evidence in support of the application. The application of the procedures in Order 22 to Part 4.4, prior to the amendment, was unclear. The result was that it was possible to circumvent the strict requirements for summary judgment in Order 22 by making application under Part 4.4 of the Civil Procedure Act 2010 which arguably contains a more liberal test for obtaining summary judgment (see Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd [2013] VSCA 158).

Now Order 22 seeks to facilitate summary judgment under Part 4.4, in the following manner:

• it sets out what is required in a supporting affidavit, that is, verifying the facts and stating in the deponent's belief that the claim or defence has no real prospects of success;
• it sets out the evidentiary requirements for affidavit material in support of an application;
• it sets out a requirement for the respondent to show cause not less than 3 days before the hearing in the summons;
• it sets out the evidentiary requirements in showing cause;
• it allows cross-examination on the affidavit material;
• it provides for directions to be given where the application is not fruitful;
• it contains a provision for setting aside the judgment where there is no appearance by the respondent; and
• it sets out a process for third party procedure applications.