No liability for costs on a discontinued cross claim

Hamerco Pty Ltd v Cosentino Australia Pty Ltd [2026] NSWDDT 3

A Cross Claimant seeking to discontinue its Cross Claim brought against an alleged joint tortfeasor will not necessarily incur a liability for costs

In Hamerco Pty Ltd v Cosentino Australia Pty Ltd [2026] NSWDDT 3, the Plaintiff claimed damages in the Dust Diseases Tribunal in New South Wales (DDT) for injuries including silicosis, progressive massive fibrosis, attenuated psychosis syndrome and major depressive disorder. The Plaintiff maintained that these conditions were caused by his exposure to respirable crystalline silica dust (‘RCSD’) during his work as a stonemason.

Issue

The Plaintiff had been employed by Hamerco Pty Ltd (“Hamerco”) as a stonemason, where he was exposed to RCSD in the course of his employment.

Hamerco filed a Cross Claim seeking contribution to the Plaintiff’s damages from six suppliers of engineered stone products who were defendants to the Plaintiff’s claim. In addition, Hamerco brought a Cross Claim against Cosentino (the alleged joint tortfeasor) alleging the Plaintiff was exposed to RCSD from Cosentino products. Prior to the Trial of the Plaintiff’s claim for damages, Hamerco settled the Plaintiff’s proceedings and the second Cross Claim against six of the seven Cross Defendants sued but had not settled with Cosentino. The outstanding issue to be determined by the DDT was the entitlement to Hamerco to discontinue its Cross Claim without paying costs sought by Cosentino.

On account of the Cross Claim settling, Counsel for Hamerco applied for an Order dismissing Hamerco’s Cross Claim against Cosentino. The DDT made the Order pursuant to Rule 29.8 of the Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”) and in doing so, the Court was required to have regard to Rule 42.20 of the UCPR:

“(1) If the court makes an order for the dismissal of proceedings, either generally or in relation to a particular cause of action or in relation to the whole or part of any claim, then, unless the court orders otherwise, the plaintiff must pay the defendant’s costs of the proceedings to the extent to which they have been dismissed” (emphasis added).

Counsel for Cosentino accepted a relevant factor to determining costs was whether Hamerco acted reasonably in commencing and/or continuing the proceedings. In this regard, Counsel for Cosentino argued they were not a party to the Plaintiff’s proceedings and the Plaintiff did not allege that he was exposed to Cosentino engineered stone products.

Relevant Law

• Dust Diseases Tribunal Regulation 2019 (NSW) (“DDT Regulation”) (Clauses 86, 87, 88, 89, 95 – Offers of Compromise)
• Uniform Civil Procedure Rules 2005 (NSW) (Rules 29.8 – Dismissal of proceedings on plaintiff’s application and 42.20 – Dismissal of proceedings)

Held

The DDT found in favour of Hamerco, ordering the Cross Claimant and Cross Defendant to pay their own costs of and incidental to the second Cross Claim. His Honour, Russell J, held:

• Cosentino’s acceptance that it supplied engineered stone products to Hamerco and the Plaintiff’s allegation of exposure to RCSD during his employment with Hamerco could substantiate an ‘arguable case’ against Cosentino, despite the fact that he did not make a direct allegation of exposure to Cosentino’s products.
• Hamerco’s request for the Cross Claim against Cosentino to be dismissed could not be regarded as a surrender. The request for dismissal arose from an intervening event, being the settlement of the Plaintiff’s proceedings, as considered in One.Tel Ltd v Deputy Commissioner of Taxation [2000] FCA 548.
• Rule 42.20 of the UCPR does not create a presumption that costs will be ordered against the party seeking dismissal of an action.
• Clauses 86 and 90 of the DDT Regulation in respect of Offers of Compromise were designed to operate where there is a Hearing on the merits and a decision by the court based on the evidence heard. Similarly, the Calderbank offers made by Cosentino to Hamerco were premised upon there being a Hearing on the merits. As such, where the matter had settled prior to the hearing, a joint tortfeasor could not rely on their offer of compromise or Calderbank offers to seek an order for costs, in circumstances where the wording was as follows: “a less favourable result at the hearing of the matter” (emphasis added).

Implications

Where the joint tortfeasor is not named as a party to the Plaintiff’s proceedings, the continuance of the Cross Claim against that joint tortfeasor, if reasonably commenced, does not necessarily carry a liability for costs. The settlement of the Plaintiff’s claim whereby he recovered full damages obviating a hearing on the merits operated as the intervening event.  This was determinative of the Cross Defendant’s entitlement as to costs.

It should not be assumed that discontinuance against a Cross Defendant automatically carries with it an entitlement to costs.

Should you have any queries concerning a dust diseases matter, please contact our team on (02) 8297 5900.