Dilapidations claims & Part 36 offers:
A miss is as good as a mile (source Taylor Wessing real estate disputes team 0207 300 4199)
Hammersmatch Properties (Welwyn) Limited v (1) Saint-Gobain Ceramics and Plastics Limited (2) Saint-Gobain Abrasives Inc [2013] EWHC 2227 (TCC)
Summary
The Court had been asked to make a costs order following its earlier decision on a terminal dilapidations claim. The decision is a very useful reminder of how Part 36 will be applied by the Courts, and how serious the consequences can be.
In this case, the defendant tenant had made a Part 36 offer to settle, which was not accepted by the landlord. At trial, the landlord was awarded damages that were only slightly higher than the tenant's offer.
The tenant argued that the normal rule, that the winning party can recover its costs, should not apply because its offer was such a near miss. It argued that the Court should take account of its Part 36 offer in reducing the amount of the landlord's costs.
The Court did not accept the argument. It held that the Part 36 offer, although very near, was still not sufficient. The mere fact of a near miss was not sufficient to affect the costs order.
