Indemnity basis

Business Environment Bow Lane Ltd (formerly Ravencap (No 2) Ltd v Deanwater Estates Ltd (formerly Gooch Webster Ltd [2008] EWHC 2003 (TCC) QBD 31 July

A court can award indemnity costs under CPR 44.4 where the facts of the case and/or the conduct of the parties is such as to take the case out of the norm and the claimant landlord had acted in such a way so as to take the case out of the norm. The claimant had represented to the tenant both before and after the start of the litigation that it had a substantial dilapidations claim. The claimant had known what work it intended to carry out from the time when it made its initial claim and had persisted in making that claim at the time of the service of the particulars of claim. The statement of truth, made on its behalf on the claim form and in the statement of claim, had attested to the fact that it was a genuine claim for dilapidations and that the work claimed had been carried out. Any proper investigation of the claim both before the particulars of claim had been served and afterwards would have revealed that the external works had not been carried out and that it was not a genuine claim for dilapidations. Even in the schedule of dilapidations, the claimant had persisted in a substantial claim that it knew or ought to have known was unsustainable. In the circumstances, it was appropriate that the claimant would pay the defendant’s costs on the indemnity basis.