Bovis Homes Ltd v Kendrick Construction Ltd

Bovis Homes Ltd v Kendrick Construction Ltd

Kendrick Construction Limited should have raised the arbitration point during the Pre-Action Protocol process, given their knowledge of the likely arbitration clause and absence of any request for the contract. Their failure to do so justifies an order that they pay Bovis Homes Limited the costs thrown away since 18th December 2007, subject to assessment after arbitration. However, only costs truly wasted are recoverable, and a summary assessment at this stage is inappropriate.

Parties
Claimant: Bovis Homes Limited; Defendant: Kendrick Construction Limited
Jurisdiction
England and Wales
Judgment Date
09 June 2009
Procedural Posture
Civil (construction Dispute) / Application for Stay of Proceedings Pending Arbitration and Determination of Costs
Outcome
Stay of proceedings granted; costs thrown away to be paid by Kendrick to Bovis, subject to assessment; Kendrick awarded costs of stay application up to 14th April 2009; Bovis awarded 50% of costs incurred since 14th April 2009.
Legal Topics
Stay of Proceedings, Pre Action Protocol Compliance, Costs Thrown Away, Jurisdictional Objections
Civil Procedure Arbitration Construction Law Stay of Proceedings Pre Action Protocol Compliance Costs Thrown Away Jurisdictional Objections

Case Brief

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Parties

Bovis Homes Limited

Claimant

Kendrick Construction Limited

Defendant

Procedural Posture

Civil (construction Dispute) / Application for Stay of Proceedings Pending Arbitration and Determination of Costs

Legal Issues

  1. 1 Whether the defendant's failure to raise arbitration at the Pre-Action Protocol stage should affect costs
  2. 2 Whether costs incurred by the claimant after the defendant's late invocation of arbitration are recoverable as costs thrown away
  3. 3 Appropriate timing and assessment of costs thrown away

Ratio Decidendi

Kendrick Construction Limited should have raised the arbitration point during the Pre-Action Protocol process, given their knowledge of the likely arbitration clause and absence of any request for the contract. Their failure to do so justifies an order that they pay Bovis Homes Limited the costs thrown away since 18th December 2007, subject to assessment after arbitration. However, only costs truly wasted are recoverable, and a summary assessment at this stage is inappropriate.

Court Disposition

Stay of proceedings granted; costs thrown away to be paid by Kendrick to Bovis, subject to assessment; Kendrick awarded costs of stay application up to 14th April 2009; Bovis awarded 50% of costs incurred since 14th April 2009.

Orders

  • Proceedings stayed pending arbitration under section 9 of the Arbitration Act 1996.
  • Kendrick Construction Limited to pay Bovis Homes Limited the costs thrown away since 18th December 2007, to be assessed if not agreed after arbitration.