A Bad Bargain? Most Definitely Not.
Normally when a matter proceeds to Court for a point of principle you would expect that both parties have a reasonable expectation of success, given the costs involved. Occasionally however, there is a case that is proceeding towards a determination, where you are so sure of your position that you question yourself in relation to what possibly you may be missing. This was such a case, and it was a case proceeding primarily because the opponent did not apply contract law principles appropriately.
This case related to significant personal injury arising from a horse trek. Liability was denied and proceedings instituted. When, in the event, substantial damages had been agreed by way of Part 36 Offer and Acceptance, the Defendant had indicated that fixed costs applied as the matter had not been allocated. That was taken at face value by the Claimant solicitor, and the level of those costs, and all disbursements were therefore presented to the opponent, together with bank details, and payment was requested.
The Defendant responded by way of their own Calderbank Offer which accepted the profit costs as claimed but disputed the disbursements. The Claimant responded to this with reasons as to why the disbursements were reasonable, which prompted a further revised offer by the Defendant. This revised offer was still insufficient, so the instructed solicitor informed the opponent that Roundel Legal Costs Solicitors had been instructed to recover the missing disbursements.
Upon instruction Roundel Legal Costs Solicitors noticed that the case had in fact been allocated, a fact missed by both the conducting solicitors. Accordingly, for the avoidance of doubt it was confirmed that any previous offers were withdrawn, and a Bill would be prepared. Roundel Legal Costs Solicitors thereafter commenced the Detailed Assessment procedure by serving a Bill of Costs and N252 which sought Standard Basis costs.
Elsewhere, and in the Points of Dispute, the Defendant acknowledged surprise as they stated that there had been an agreement in good faith with respect of the profit costs as claimed. Roundel Legal Costs Solicitors responded to confirm that you cannot agree part of a contract and therefore there had been no agreement in whole or in part. Furthermore, it was contended that basic contract law principles of offer, counter-offer and acceptance applied and there was no agreement.
The matter proceeded to Court on the preliminary issue as to whether or not there had been a concluded agreement as to profit costs. In the Skeleton Argument the Defendant referred to Roundel Legal Costs Solicitors correspondence which stated that you cannot agree part of a contract and stated that this was Roundel Legal Costs Solicitors “attempt to free their client from what they plainly considered to have been a ‘bad bargain’ by” their client.
The Court's decision
At the Hearing the Court found that Roundel Legal Costs Solicitors were correct in their interpretation of the basic contract law principles of offer, acceptance, and counter-offer, and therefore the Court found there had been no concluded agreement. This was expected, but it would have been interesting for the Court to consider the Claimant’s other potential arguments raised. These included the doctrines of misrepresentation and/or mistake which could have led the contract to be voidable in any event, if of course it existed in the first place.
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