WASTED COSTS AND THE PRE-ACTION PROTOCOL

Bovis Homes Ltd v Kendrick Construction Ltd [2009] EWHC 1359 (TCC), [2009] All ER (D) 157 (Jun)

In Bovis Homes Ltd v Kendrick Construction Ltd [2009] EWHC 1359 (TCC), [2009] All ER (D) 157 (Jun), Mr Justice Coulson held that the Pre-Action Protocol for Construction and Engineering Disputes requires the parties to exchange fully their views not only on the substance of the underlying dispute but also on the procedure to be adopted in seeking to resolve the dispute. On the facts he held that the defendant should have drawn attention to its reliance upon the arbitration clause in the contract at an earlier stage. While Mr Justice Coulson held that the defendant was entitled to a stay of the present proceedings under s9 of the Arbitration Act 1996, he held that the claimant was entitled to recover 50% of the costs it had incurred in relation to the present application after the claimant had accepted that the defendant was entitled to a stay, although the assessment of the costs thrown away could not be done until the outcome of the arbitration was known.