Indemnity costs awarded to JMW client

Associate Solicitor Ben Blatch-Hanlon has had a positive result in defending a legal claim and, thanks to JMW’s strategic advice, was able to protect its client’s position in circumstances where the matter ended up going all the way to trial.

Background

JMW represented the defendant client, a company that specialises in the sale of new and used leisure boats. The claimant paid a deposit on the purchase of a boat, which was ordered to its custom specifications, but later tried to cancel the order after it had been confirmed. The claimant alleged that the payment was a refundable ‘goodwill payment’ and brought a legal claim to recover the deposit.

JMW’s client had retained the deposit and defended the claim on the basis that the claimant had known that it was a deposit which was non-refundable. JMW’s client made a counterclaim to recover its loss of profits as a result of the cancellation.

Nearly two years before the trial, JMW’s client had made an offer to settle the matter.

How did JMW help?

Associate Solicitor, Ben Blatch-Hanlon, advised the director of the client company on the legal position and strategy. The client subsequently made the offer to settle on behalf of the claimant company, as well as further offers in attempts to settle the dispute before trial, which, despite not being accepted by the claimant, proved to be crucial to protecting the client’s entitlement to recover its legal costs.

What was the outcome?

Ben followed the claim to trial, where the court held in JMW’s client’s favour, finding that the payment made by the claimant was in fact a deposit which was forfeit on cancellation, allowing the client to retain the deposit and awarding damages in relation to the counterclaim.

Significantly, JMW’s client was awarded indemnity costs of nearly double the value of the deposit due to the claimant’s failure to accept the offer that had been made in 2024, nearly two years prior to the trial.

Indemnity costs are the harshest form of costs and are usually only imposed when a party has behaved unreasonably in litigation.

Ben said: “Our client made pragmatic efforts to settle this legal claim at various stages in the litigation process, including in the build-up to the trial itself. The fact that these commercial offers, which our client viewed as very reasonable, were not accepted by the claimant highlights the importance of making sensible settlement offers early in the litigation process, both in terms of the costs protection it can give parties that make offers but also the risk that parties face when rejecting offers.”