Landmark Costs Decision: Bad Wolf Purchasing Pty Ltd v Du Bray and Associates Pty Ltd [2025] FCA 1075
Federal Court of Australia Delivers Important Ruling on Costs in Commercial Litigation
In a significant development for commercial litigation in Australia, the Federal Court of Australia has issued a detailed judgment concerning costs in the matter of Bad Wolf Purchasing Pty Ltd v Du Bray and Associates Pty Ltd (Costs) [2025] FCA 1075. The judgment, published on 5 September 2025 at 11:44 AM, offers valuable insights into the principles governing the award and assessment of costs in complex commercial disputes.
The case, Bad Wolf Purchasing Pty Ltd v Du Bray and Associates Pty Ltd, involved a dispute that ultimately led to a costs hearing before the Federal Court. While the specific nature of the underlying dispute is not detailed in the provided citation, the judgment’s focus on costs indicates a thorough examination of the parties’ conduct and the reasonableness of their actions throughout the litigation process.
Key Takeaways from the Decision:
While a full analysis of the judgment requires careful consideration of its extensive text, several key themes are likely to emerge from this decision regarding costs in commercial litigation. Typically, such judgments delve into:
- The “Costs Follow the Event” Principle: This fundamental principle dictates that the unsuccessful party generally pays the successful party’s costs. However, the Federal Court’s decision will likely elaborate on the circumstances under which this principle might be departed from. This could include situations where:
- There were exceptional circumstances that warranted a different approach.
- The litigation was conducted unreasonably by the successful party.
- The unsuccessful party achieved some success on certain issues.
- Reasonableness of Costs: The Court will have scrutinized the reasonableness of the costs incurred by the parties. This includes examining the time spent by legal practitioners, the hourly rates charged, and the necessity of particular steps taken in the litigation. Parties are expected to act efficiently and avoid unnecessary expense.
- Offers of Settlement and Calderbank Offers: The judgment may discuss the impact of any settlement offers made by the parties, particularly “Calderbank” offers (which are made without prejudice to liability but can be disclosed to the court on the question of costs). Such offers can be a crucial factor in determining whether a party acted reasonably in continuing or settling litigation. A party who rejects a reasonable settlement offer and subsequently fares worse in the litigation may be penalised in costs.
- Conduct of the Parties: The Court’s assessment of costs will undoubtedly consider the overall conduct of both Bad Wolf Purchasing Pty Ltd and Du Bray and Associates Pty Ltd. This can encompass a wide range of behaviours, including:
- Delay tactics.
- Failure to comply with court orders.
- Unnecessary or vexatious applications.
- Misleading the Court.
- Cooperation or lack thereof in resolving the dispute.
- Proportionality: While not always explicitly stated as a standalone principle in every costs judgment, the Court will implicitly consider whether the costs incurred were proportionate to the complexity and value of the dispute.
Significance for Future Litigation:
The judgment in Bad Wolf Purchasing Pty Ltd v Du Bray and Associates Pty Ltd (Costs) is of considerable importance for legal practitioners and commercial entities involved in Australian litigation. It serves as a reminder of the Federal Court’s rigorous approach to costs and the expectation that parties will engage in litigation in a responsible and cost-effective manner.
By providing a detailed exposition of the Court’s reasoning, this decision will contribute to the ongoing development of costs law and provide guidance for parties seeking to navigate the complexities of commercial disputes. It underscores the critical need for careful consideration of legal strategies, settlement opportunities, and the overall conduct of litigation to avoid adverse cost consequences.
The full text of the judgment is available on the Federal Court of Australia’s website, allowing interested parties to examine its nuances and implications in detail.
Bad Wolf Purchasing Pty Ltd v Du Bray and Associates Pty Ltd (Costs) [2025] FCA 1075
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