Indemnity Costs after offer was 'ignored'
Posted on 29th July 2021 at 09:00
By Sean Linley, Costs Draftsman
The High Court made an order for costs on an indemnity basis after the Defendant ignored an offer made by the Claimant.
In Private Joint Stock Company Pharmaceutical Firm "Darnitsa" v Metabay Import/Export Ltd [2021] Costs LR 457, the High Court considered what the appropriate costs order would be in relation to an application for a freezing injunction.
Sir Michael Burton GBE (sitting as a judge of the High Court) noted that the Claimant had made, what was in his view, a sensible offer "to seek to save costs and court time". It was noted that had the offer been accepted "not only would both sides’ costs of the hearing before me have been saved, but the defendant would have ended up in a far better position than it is now, facing a substantial order for costs to be paid."
The Court was critical of the failure of the Defendant to not respond at all to the offer. It was noted that "there was no reply at all to this letter. I am clear that such sensible offers should be encouraged and that there should be some penalty for refusing them or, as in this case, ignoring them." It was concluded by the Court that "the conduct of the defendants in taking that course was unreasonable, and out of the norm.". Indemnity costs were ordered from 14 May "i.e. giving a time for the Claimant's offer to be properly considered."
The lesson is to ignore offers at your peril.
Tagged as: indemnity costs
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