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New Cap Reinsurance Corporation Limited (in Liq) v Azmin Firoz Daya [2012] NSWSC 1205Brereton J.

7 The effect of the rules is that if some other order is to be made, the discontinuing party will have to show some proper justification for a different costs consequence [Bitannia Pty Ltd v Parkline Constructions Pty Ltd [2009] NSWCA 32; Australiawide Airlines Ltd v Aspirion Pty Ltd [2006] NSWCA 365].

Some circumstances in which it has been held appropriate to depart from the prima facie position include where the plaintiff has already achieved practical success in the proceedings, or where costs have been significantly increased by the unreasonable conduct of the defendant, or where the proceedings have been rendered futile by circumstances beyond the plaintiff's control [Metsikas v Quirk [2010] NSWSC 756].

Thus, while UCPR, r 42.19, provides what is in effect a default position upon discontinuance, it does not create a presumption, and if it can be shown, for example, that the plaintiff has discontinued because it has, by reason of action taken by the defendant in the meantime, achieved practical success in the proceedings, the Court may nonetheless order the defendant to pay the costs [see, for example, Cummins v Australia Jockey Club Ltd [2009] NSWSC 254, [22-23]].

On the other hand, where there is in effect a capitulation by the plaintiff, it will not be appropriate to depart from the default position [see Bitannia v Park Lane Constructions].

In some cases, where the plaintiff has neither wholly achieved practical success nor capitulated, the position may be intermediate, and where a plaintiff obtains a measure of success short of complete success in respect of the relief it seeks, an appropriate outcome may be that there be no order as to costs [East Mark Holdings Pty Ltd v Owners Strata Plan 74602 [2009] NSWSC 1483]. In such cases, an approach akin to that espoused by McHugh J in Re Minister For Immigration and Ethic Affairs Ex Parte Lai Qin[1997] HCA 6; (1997) 186 CLR 622 may be appropriate [East Mark Holdings, at [5] - [7]].

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