Court rules on costs management in student accommodation defects case

Introduction

The High Court, presided over by Mr Justice Constable, recently handed down a judgment concerning costs management in a case involving alleged defects in a block of student accommodation. The case, titled GS Woodland Court GP 1 Limited & Ors vs RGCM Limited & Ors, was heard in the Technology and Construction Court, with a focus on the costs management process.

Background

The claimants, GS Woodland Court GP 1 Limited and GS Woodland Court GP 2 Limited, acting as general partners on behalf of GS Woodland Court Limited Partnership, brought a claim against seven defendants, including RGCM Limited and Hadfield Cawkwell Davidson Limited. The case centred around numerous alleged defects in a student accommodation project, particularly concerning fire-safety attenuation measures.

Case Details

The project was constructed using a modular-unit approach, with the claimants alleging significant defects in the fire-safety measures. The defendants included the construction manager, architect, cladding contractor, modular unit supplier, developer, fire-stopping works contractor, and installer. The claimants argued that the construction manager should bear the full responsibility for the alleged defects.

Legal Arguments

During the proceedings, Ms Packman KC, representing the claimants, argued that the complexity of the case warranted the costs claimed. In contrast, Ms Stephens KC, representing the first defendant, contended that the case was not novel and should not require excessive legal costs. The court heard arguments regarding the incurred costs and the proportionality of the costs in relation to the complexity of the case.

Court's Analysis

Mr Justice Constable noted that the claimants' costs appeared potentially disproportionate compared to the defendants' costs. He emphasised the need for claimants to have a focused approach in such multi-defendant litigation. The judge also highlighted the excessive rates claimed by the claimants' solicitors, which were significantly above the guideline rates.

Judgment

The court ruled that the claimants' costs were excessive and granted an application for costs by several defendants. The judgment emphasised that parties should not assume they can proceed to a costs management hearing with an overly ambitious budget without potential consequences in costs. The court ordered the claimants to bear their own costs of the costs management hearing and to pay the reasonable costs of certain defendants.

Implications for Practitioners

This judgment serves as a reminder to legal practitioners about the importance of proportionality and reasonableness in costs management. It highlights the court's willingness to scrutinise costs claims and the potential for adverse costs orders when parties present unrealistic budgets.

Learn More

For more information on construction disputes, see BeCivil's guide to Resolving Construction Disputes.