[2014] EWHC 2016 (TCC)

The dispute here related to the design and construction of a car  park in North Cheam. Two of the Defendants successfully brought  applications to strike out the claims against them. They then  applied for their costs on an indemnity basis because , they said,  Sainsbury’s had failed to follow the pre-action protocol process. 

Mr Justice Stuart-Smith allowed the first application, noting that  no good reason had been shown for the failure to implement the  Protocol before issuing the Claim. Had Sainsbury’s done so, the  Judge was of the view that it would have obtained all the relevant  information it needed to reassess whether proceedings should  have been brought against that party.

The second application was allowed in part. Here the Judge felt  that the party seeking indemnity costs had himself not engaged  in the pre-action correspondence “as constructively” as he might  have done and had further given inaccurate information during  that process. However, the position changed once a Defence had  been served. Sainsbury’s ought to have reassessed its position.  Had it done so, it should have realised that its claim was liable to  be struck out or be the subject of an adverse summary judgment  application. The Judge made it clear he was not saying that a party  automatically has to accept assertions made in a defence, but it  must consider them in terms. Accordingly, the second party was  allowed its costs on an indemnity basis but only from the date of  the first Case Management Conference.