Description
Costs judgment following a successful dilapidations claim on the termination of a lease where the damages awarded were marginally more advantageous than a Part 36 offer raising the issue of the application of the 'near miss' rule.
Held: The court should resist invitations to speculate whether Part 36 offers to settle litigation which were not in fact made might or might not have been accepted if they had been made (
Johnsey Estates (1990) Limited v Secretary of State for the Environment, Transport and the Regions [2001] EWCA Civ 535). The principle that a party be penalised in costs where it rejects outright, without any attempt to negotiate, an offer which is near but not quite sufficient, should no longer apply (
Multiplex Construction (UK) v Cleveland Bridge UK [2008] EWHC 2280 (TCC) and
Carver v BAA Plc [2008] EWCA Civ 412 departed from). If there is an unreasonable refusal to negotiate then that is a matter which comes within the circumstances which the court can take into account under CPR 44.2(4): it is doubtful that a 'near miss' offer can add anything to what otherwise would be conduct in the form of unreasonable refusal to negotiate.
In the present case, the unsuccessful Part 36 offer could not be treated as a successful Part 36 offer: there was no unreasonable refusal to negotiate. Taking into account all the circumstances, the claimant was awarded 80 per cent of its costs to be assessed on a standard basis.
