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	England and Wales High Court (Technology and Construction Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Technology and Construction Court) Decisions >> Jaevee Homes Ltd v Fincham (t/a Fincham Demolition) [2025] EWHC 1134 (TCC) (12 May 2025) URL: https://www.bailii.org/ew/cases/EWHC/TCC/2025/1134.html Cite as: [2025] EWHC 1134 (TCC)

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IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (KBD)

		Royal Courts of Justice Rolls Building London, EC4A 1NL
		12 May 2025

 
This judgment was handed down by the court remotely by circulation to the parties' representatives by email and released to The National Archives.

Mr Roger ter Haar KC :

1. On 16 April 2025 my judgment on the Claimant's Part 8 claim was handed down. I do not repeat the contents of that judgment in this judgment.
2. The order consequent upon my judgment on the Part 8 claim has been agreed in all respects save for two issues as to costs:

(1) The costs of a stay application made by the Claimant;

(2) The costs of these proceedings (other than the costs relating to the stay application).

The Costs of the Stay Application

3. The present proceedings were commenced by the filing of the Claim Form dated 16 December 2024.
4. On 28 January 2025 the Claimant applied for a three month stay of the proceedings which it had commenced.
5. The application was supported by a witness statement from Mr. Benjamin Smith. That statement said that there were two material "updates" since the proceedings had been commenced that would impact upon the determination of these Part 8 proceedings and necessitate a stay and/or extension of time:

(1) That the Claimant had entered into a settlement agreement with a third party assignee of any debts alleged to be owed to the Defendant under the contract between the Parties;

(2) In any event, following receipt of responsive evidence filed by the Defendant on 9 January 2025, it was apparent that there was potentially a single dispute of fact between the parties in relation to the date on which the Defendant commenced the demolition works which could have a significant impact upon these proceedings including whether they could continue "in the Part 8 process".

6. On 4 February 2025 Waksman J. dismissed the application for a stay and reserved the costs to the hearing of the Part 8 Claim. The reasons given by the learned judge for his order were as follows:

8. There is no need for a stay here. Despite the matters raised by Mr Smith's witness statement dated 28 January 2025 (and it is noted that he has provided no evidence of the Claimant's payments to the alleged assignee, whereas Mr Fincham has offered disclosure of his bank statements) the core question remains that of contract formation on the basis of the documents referred to by the Adjudicator.

9. Nor does the question of the actual start date appear to affect that core question.

10. In a situation where the Defendant presently has an enforceable judgment against the Claimant made by DJ Baldwin on 9 December 2024, and where the Claimant now seeks to demonstrate that the Adjudicator's decision is wrong, albeit that there is no stay of DJ Baldwin's judgment, it is essential that these matters are determined as soon as possible. As it happens, because of when the Court is able to accommodate this matter, the Claimant will have a month since it made its application for a stay to file any further evidence.

11. If, despite all the above, the judge at the hearing takes the view that the matters cannot be resolved by the Part 8 Claim and a Part 7 claim is more appropriate, he can order to that effect at that time.

7. As I recorded in paragraph 67 of my previous judgment, the suggestion that there had been an assignment was not pursued before me, and, as I recorded in paragraph 68 of the judgment, neither was the suggestion that this matter could not be determined by way of Part 8 proceedings.
8. The Defendant seeks his costs of the stay application on the indemnity basis in the sum of £6,881, net of VAT (which is not now claimed).
9. The Defendant submits:

20. The Defendant was successful on the Stay Application, which was refused by Waksman J. The Claimant has not identified any grounds as to why the costs of the Stay Application should be subject to no order for costs.

21. Where the Defendant has succeeded in the overall proceedings, the presumption should be that these are treated as costs in the case, with the Claimant ordered to pay the Defendant's costs.

22. If the Stay Application is still considered separately, it is clear that the Claimant should still be ordered to pay the Defendant's costs of it, and do so on an indemnity basis.

23. The Defendant was successful on the Stay Application. The Claimant's request for an open ended stay of at least 3 months was refused; see the order including reasons at [MB/985-6].

24. Turning to the factors in CPR 44.2(2)(b):

24.1 Conduct: there can be no complaint as to the Defendant's conduct. The Claimant's conduct can be criticised. The two grounds on which the Claimant sought a stay were that (a) there was an alleged settlement agreement with a third party assignee, and (b) there was a dispute of fact as to when the works commenced (Smith 2, §10-11 [MB/900]). Neither argument was pursued by the Claimant at the hearing.

24.2 Partial success: there was no success by the Claimant. The Defendant succeeded in full.

24.3 Offers: there were no admissible offers in respect of the Stay Application.

10. The Claimant submits:

2. After the first round of witness evidence was exchanged in the part 8 proceedings, the Claimant applied to stay the proceedings [962], on two grounds. First, that the debt arising from the enforcement of the adjudicator's decision had been assigned from the Defendant to a third party and that the Defendant had reached a full and final settlement with (and had paid) that third party. Secondly, that there appeared to be a potentially significant dispute of fact (and that the Parties ought to be given time to ascertain whether this could be resolved so as to ensure that the claim could be heard on a Part 8 basis). This was explained in Mr Smith's evidence for the application [898], which exhibited supporting evidence for the assignment and settlement. By an Order on 5 February 2025, Waxman J refused the stay application but reserved the costs of and incidental to his directions (including the costs of the stay application) [985].

3. There was indeed a potentially material factual dispute at that point (regarding the start date of the works). Insofar as the stay application temporarily delayed the listing of the Part 8 claim, the impact was salutary because the Parties were ultimately able to use that time to agree a Statement of Facts.

4. Whether the debt was assigned as alleged is a live issue between these Parties in parallel proceedings. On 22 April 2025 and before District Judge Baldwin in the TCC (HT-2024-LIV-000020), there was a hearing of the Defendant's application to finalise a third-party debt order in respect of the sums due under the 11 December 2024 enforcement order. The alleged assignment arose at the hearing and the Judge ordered that the Claimant and Defendant must serve evidence on this issue. A hearing with cross-examination is to be listed for the first date 6 weeks after the filing of evidence (which is to be completed within 28 days from 22 April). It is therefore submitted that the assignment is a very real issue between the Parties and one that another TCC Judge has determined requires to be fully ventilated in witness evidence and cross examination. It may therefore be expected that this will be resolved by a judgment several months from now.

5. For those reasons, it is submitted that the proper order is that costs of the application should be reserved pending the outcome of the hearing to determine whether the debt was assigned. There is no real prejudice in that delay (and none that could not be compensated by interest on the costs). In the alternative, there should be no order as to the costs in respect of the Order of Waxman J and the stay application (on the basis that it would not be fair and proper to resolve those costs absent a determination of the underlying merits of the assignment allegations).

11. I accept the Defendant's submissions set out above. There were significant issues between the Parties which the Defendant was entitled to have resolved. The application for a stay failed, and there is no ground for departure from the starting point under CPR 44.2 that the unsuccessful party should pay the successful party's costs.
12. As I have said, the costs are sought by the Defendant on the indemnity basis. I do not accept that the Claimant's conduct has been such as to justify departure from assessment on the standard basis.
13. The Claimant suggests that the costs claimed are excessive, and that a reasonable figure would be £3,500.
14. It is correct that the hourly rates charged are in excess of the guideline rates for the Colchester area in which the Defendant's solicitors are based, but I accept the Defendant's submission that this is specialist litigation in respect of which it was and is reasonable for the Defendant to engage a specialist firm of solicitors.
15. I do not regard the time spent by the Defendant's solicitors as recorded in the Statement of Costs as being unreasonable.
16. Accordingly, I assess the costs payable by the Claimant to the Defendant in respect of the stay application in the sum of £6,881.

The Costs of the Proceedings

17. The Defendant seeks his costs of the proceedings to be assessed on the standard basis in the sum of £48,145; alternatively he seeks an order that the Claimant should pay 90% of his costs of the proceedings.
18. The Defendant submits:

10. Under CPR 44.2(2)(a) "the general rule is that the unsuccessful party will be ordered to pay the costs of the successful party."

11. There can be no dispute that the Defendant is the successful party in these proceedings.

11.1 The Claimant brought a Part 8 on two issues: (1) the terms of the Sub-Contract, and (2) the validity of 4 invoices relied on by the Defendant as payment applications.

11.2 The Defendant succeeded on issue (1), the terms of the Sub-Contract. This was the main issue dealt with in the witness evidence and the Defendant's submissions. It was important to the parties, given the Claimant had raised potential claims based on the terms of the Sub-Contract which it alleged applied (such as for liquidated damages).

11.3 The Defendant succeeded on issue (2) for 3 out of 4 invoices. By value, the invalid invoice represented:

11.3.1 19.8% of the value of the invoices (the total value of the 4 invoices was £195,857.50, invoice 1081 which the Court held to be invalid was for £38,750).

11.3.2 30.8% of the sum claimed (the sum claimed, following the payments made by the Claimant, was £125,650.38).

12. Under the general rule, the Defendant should be entitled to its costs of the proceedings.

13. Under CPR 44.2(2)(b), the Court may make a different order. CPR 44.2(4) sets out that in doing so "the court will have regard to all the circumstances, including –":

"(a) the conduct of all the parties;

(b) whether a party has succeeded on part of its case, even if that party has not been wholly successful; and

(c) any admissible offer to settle made by a party which is drawn to the court's attention, and which is not an offer to which costs consequences under Part 36 apply."

14. CPR 44.2(5) provides guidance on what the "conduct of the parties" for (a) includes.

15. The Claimant has not made any criticisms of the Defendant's conduct and there are no admissible offers to settle which have been drawn to the Court's attention.

16. If there is to be any criticism of conduct, it would be against the Claimant, including for (a) being in breach of the Enforcement Order, (b) only issuing the Part 8 after the enforcement resulting in duplicative proceedings, (c) the Stay Application (see below), and (d) raising new arguments, such as the challenge to the contracting party, at the hearing.

17. The Claimant's only argument for a different order is under (b) that it succeeded in part.

18. The fact that the Court found one of four invoices was invalid is not sufficient to justify departing from the general rule:

18.1 As set out above, the Defendant succeeded on the sub-contract issue.

18.2 On the invoices issue, the Claimant raised various different grounds as to why it said the invoices were invalid. All of these failed, save for one, which was in fact the Defendant's alternative position.

18.3 In circumstances where the Claimant has failed to pay the sums due under the Enforcement Order and appears will seek to avoid paying the Defendant, an order reducing the Claimant's liability by £38,750 is not, in practical terms, a loss to the Defendant or a success for the Claimant.

19. Alternatively, if the Court considers it does justify a departure from the general rule, the appropriate order is to reduce the percentage of the Defendant's costs which the Claimant is to pay, without any countervailing order for payment of part of the Claimant's costs. The Defendant considers that the appropriate percentage is, at most, 90%:

19.1 The Defendant succeeded on the sub-contract issue, which accounted for the majority of parties' evidence and costs. As a rough analysis, say 65% to 70% of the costs.

19.2 The invoice issue, therefore, accounts for 30 to 35% of the costs. The invalid invoice is, by value, 20% to 30% of the invoice issue. At its highest, 30% of 35% = 10.5%. A deduction of 10% of the total costs, produces an order for the Claimant to pay 90%.

19. The Claimant submits:

6. As to the costs of the claim generally (i.e. excluding the costs associated with the stay application), the Claimant submits that: (i) the Defendant should pay one-third of the Claimant's costs and (ii) the Claimant should pay two-thirds of the Defendant's costs, in both cases on a standard basis.

7. The Claimant was successful in part in these proceedings. In the 11 December 2024 Order enforcing the adjudicator's decision, the balance due to the Defendant was £137,412 (paragraph 6). As a result of the judgment in the Part 8 claim, that sum has been reduced to £89,739 (paragraph 3.5 of the draft Order). That is approximately a 35% reduction in the sum originally ordered (or, put another way, a £47,673 reduction). These Parties are both small businesses and a reduction of almost £50,000 is, in context, significant.

8. This reduction in the sum due would never have been achieved had the Part 8 Claim not been brought. The Defendant at all times maintained its entitlement to the full amount in the adjudicator's decision and 11 December 2024 Order. Indeed, it was not until its skeleton submissions that the Defendant mooted the third invoice might be invalid, but that was only if its primary case was rejected. The bringing of the Part 8 Claim in order to determine what invoices were properly due and (in the event) to reduce the sum due by one-third was, on any view, a legitimate and reasonable course of action for the Claimant to have taken.

20. I accept that the Defendant was the overall winning party in these proceedings and that the starting point is therefore that the Claimant should pay the Defendant's costs of the proceedings. However, I also accept the Claimant's submission that the Defendant lost on a significant issue which to an extent caused the Claimant to incur costs which would not otherwise have been incurred.
21. In those circumstances I accept that there should be a reduction in the amount of costs otherwise payable to reflect the Claimant's success and the Defendant's failure on that issue. In my judgment the reduction should be 15%, so that the Defendant will receive 85% of his costs.
22. As I have said, the amount sought is £48,145. Whilst the Claimant again submits that the costs are excessive, I do not accept that submission. I assess the costs on a 100% basis in the sum of £48,145.
23. The result is that the Claimant is ordered to pay the Defendant £40,923.25 in respect of his costs of these proceedings.

Time to pay

24. Accordingly the amount payable by the Claimant to the Defendant is £47,804.25.
25. The Defendant seeks an order that this sum be paid by the Claimant by Friday 2 May 2025. The reasons given are as follows:

28. Under CPR 44.7 an order for costs is to be complied with within 14 days of the amount of costs being determined unless the Court orders otherwise. The Court should order otherwise to do justice in this case:

28.1 The Claimant will have known since receipt of the draft judgment on 2 April 2025 that it will be the paying party. The question is how much.

28.2 The Claimant has caused delays since the draft judgment by (i) not providing a draft order, (ii) not responding to the Defendant's draft order, and (iii) only requesting further submissions on costs after the Judgment was handed down and immediately before the Easter weekend.

28.3 The Claimant has refused to pay the costs due under the Enforcement Order since 9 December 2024.

28.4 There is a winding up hearing involving the Claimant on 7 May 2025.

26. The Claimant submits:

20. It is submitted that any sums due on costs should be payable within 21 days of the date of the Court's Order. It is understood that the Defendant contends for a significantly shorter period. Whilst there has been some delay in dealing with the consequentials for this hearing, it is not inordinate and was largely driven by availability the Easter vacation period. It is further submitted that, were it not for the Defendant insisting upon being paid the entirety of its costs (despite the Claimant's partial success) it is probable that costs would have been capable of being agreed in full.

27. I accept the Defendant's submissions save that the latest date for payment will be Monday 5 May 2025. In setting that date, I note that the Claimant has not put forward any grounds for suggesting that it will have difficulty making the payment, and I regard it as appropriate that the Court considering the winding up application should know whether the order I have made has been honoured.
28. For the avoidance of doubt, I give permission for the contents of this judgment, even if not yet formally handed down, to be made known to the judge hearing the winding application.