The property consultants Strutt & Parker have been ordered to pay £550,000 for the negligent advice it gave the Earl of Malmesbury over the lease of an airport car park. This is in addition to a £450,000 interim payment they were ordered to pay in June pending the damage assessment. The High Court Judge, Mr Justice Jack ordered the payment after he found Strutt & Parker liable to Malmesbury for £915,000 in damages for negligence plus interest.
The Earl of Malmesbury owned an agricultural estate bordering Bournemouth International Airport. He leased 9 acres of land to the airport on a 24 year lease for the purpose of airport car parking. He sued Strutt & Parker, who negotiated the lease, for professional negligence on the basis that the rent agreed was a fixed rent renewable by reference to an index when normal commercial practice would have been to reserve turnover based rent or a rent renewable to market value.
After the judgement, John Gallagher argued that the payment should not be ordered because Malmesbury will be receiving less than 1% of his total £100m claim and “that could not possibly be said to have amounted to success.” He also commented “disproportionate is the word that screamed out from the rooftops in this case” and if Malmesbury had not run a “grossly over-inflated claim” Strutt & Parker would have taken a totally different approach to the litigation and would not have had to incur £3m in legal costs.
Mr Gallagher stressed that the “overwhelming likelihood “ was the net result of a costs hearing scheduled for 19-20 February 2008 would be that Strutt & Parker will be owed money by Malmesbury rather than the other way round.