(1) If an offer is made by a respondent and not accepted by an applicant, and the applicant obtains a judgment that is less favourable than the terms of the offer:
(a) the applicant is not entitled to any costs after 11.00 am on the second business day after the offer was served; and
(b) the respondent is entitled to an order that the applicant pay the respondent's costs after that time on an indemnity basis.
(2) If an offer is made by a respondent and an applicant unreasonably fails to accept the offer and the applicant's proceeding is dismissed, the respondent is entitled to an order that the applicant pay the respondent's costs:
(a) before 11.00 am on the second business day after the offer was served--on a party and party basis; and
(b) after the time mentioned in paragraph (a)--on an indemnity basis.
(3) If an offer is made by an applicant and not accepted by a respondent, and the applicant obtains a judgment that is more favourable than the terms of the offer, the applicant is entitled to an order that the respondent pay the applicant's costs:
(a) before 11.00 am on the second business day after the offer was served--on a party and party basis; and
(b) after the time mentioned in paragraph (a)--on an indemnity basis.
Note 1: Costs on an indemnity basis is defined in the Dictionary.
Note 2: The Court may make an order inconsistent with these rules--see rule 1.35.