Lloyds Developments Limited v Accor Hotel Services UK Limited [2026] EWHC 1238 (TCC)

Ref. HT-2022-000022
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (KBD)
Venue 7 Rolls Buildings, Fetter Lane,[2026] EWHC 1238 (TCC)
London
Before THE HONOURABLE MRS JUSTICE JEFFORD
IN THE MATTER OF
LLOYDS DEVELOPMENTS LIMITED
-v-
ACCOR HOTEL SERVICES UK LIMITED
MR T LAZUR, appeared on behalf of the Claimant
MR M ESLY; MR J SPENCE, appeared on behalf of the Defendant
JUDGMENT
12 th MAY 2026
(AS APPROVED)
__________________
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Between
Lloyds Developments LimitedClaimantAccor Hotel Services UK LimitedDefendantDate 2026-05-12
[1]The background to this application dates back to 2023, when in email exchanges between Haynes Boone, Accor’s solicitors, and Spencer West, then representing Lloyds, the claimant, Mr Esly proposed a methodology to be followed in relation to disclosure which included that “Document families (eg. emails and their attachments) should not be broken up on production. All family documents to responsive documents should prima facie be disclosed”. That was agreed to by Spencer West. Although that was an agreed process between two firms of solicitors as to the production of documents, it does not as such bind the court, which has at all times required that disclosure should be properly carried out. Once Hill Dickinson had become involved and further substantial disclosure had been given, the evidence is that there were complaints from Haynes Boone to Hill Dickinson as to the volume of material that was being disclosed including irrelevant material. Mr Lazur submits that Hill Dickinson have sought to address complaints of that nature by adopting a different methodology in which in many instances documents were disclosed with, if you like the head of the family document being disclosed, but not any attachments or other family documents for which there is a place holder simply marked not relevant.[2]Mr Esly in his 25th witness statement at paragraph 114 said this:
“Given Lloyds' failure to properly determine whether documents attract privilege, Accor does not have confidence that Lloyds has properly considered whether documents are relevant to the matters in dispute. Lloyds has not disclosed full families (for example attachments of or cover emails to relevant documents). Over 48,000 documents, family members of produced documents have been withheld on the basis that they are supposedly not relevant. In many cases this leaves Accor unable properly to interrogate the significance of the documents which have been disclosed.”
He then proceeds to say that there are thousands of potential examples, which I take to refer to the head of the family documents, and in the interests of brevity gives three examples.[3]The over-arching premise of the application was, therefore, that Lloyds’ approach to whether documents attracted privilege caused Accor to lack confidence in the review of documents that had been undertaken for relevance. One of the examples given in the statement has been addressed by Mr Lazur and quickly dismissed as not properly reading the description of the attachment. Another is payment run spreadsheets referred to as an attachment, and then there is a description which I do not propose to read out in paragraph 118 of Mr Esly's statement as to why such documents may be relevant. What is not submitted is that there is reason to believe from other documents which have been disclosed that the attachments to such emails are, in fact, relevant. But what there is is a degree of speculation as to relevance and a lack of confidence in the approach that has been taken by Lloyds' solicitors because of what has happened in relation to privilege. Mr Lazur rightly points out that Hill Dickinson have, so to speak, held their hands up to those failings and mistakes, but do not, in contrast, do so when it comes to the identification of relevance. He also submits that there is a point at which the court should say that a line has to be drawn, particularly having regard to proportionality and the overriding objective.[4]In my judgment, absent any clear evidence that the approach taken to the assessment of relevance is itself wrong, and given the high level of disclosure already given, I do not regard it as proportionate, or in accordance with the overriding objective, to require Lloyds to produce all of the documents which their solicitors have concluded are not relevant. Were there applications in respect of individual documents the relevance of which could be indicated from surrounding material - bearing in mind that one cannot judge the relevance of documents that one has not seen - that would be a different matter. But this is a comprehensive application for the disclosure, essentially, of everything falling within the family groupings, if I can put it that way, which is likely to run, on both parties' cases, to somewhere between 48,000 and 50,000 further documents. I simply do not regard that as sufficiently supported by the evidence to be something that in the interests of proportionality the court should order. (Following further submissions)[5]This was an application issued on 25 March of this year - as is common in this case, a composite application for additional security for costs for production of documents that were withheld for privilege; an unless order in respect of certain so-called trust instruments; an application for the production of so-called family documents; and an application in relation to, adopting Accor’s terminology, the Cooperation Agreement.[6]For reasons that will become apparent, I am going to take the submissions of counsel in reverse order. Accor submit that it ought to be the beneficiary of the costs order because it has been successful on this application to a very considerable extent. It has obtained additional security;. I have made the order for the documents withheld on grounds of privilege to be reviewed by the Independent Reviewer proposed by Accor. The trust instruments have been produced without the need for an order. I have made several directions in relation to the reconsideration of the redaction of the Cooperation Agreement and an explanation for the redactions that have been made, not least against the background where in the form originally disclosed, what might be thought to be the most relevant clause, namely clause 4.3, had been redacted. The only element of the application on which Accor has been entirely unsuccessful is the application relating to family documents, that is for the disclosure of those withheld from production and replaced, so to speak, by a non-relevant placeholder.[7]Mr Lazur submits to the contrary that Lloyds have been the successful party and ought therefore to receive an order in their favour. He makes that submission against the background of a chronology which is essentially as follows. In December and January there was a significant further tranche of disclosure from Lloyds to Accor and Accor demanded or asked for £600,000 for further security for costs relating to that disclosure. By 23 March 2026 that amount which Accor sought had increased very substantially to £3.7 million in respect of disclosure and, in addition, a request for £2.9 million additional security was made in respect of experts’ report. Mr Lazur said that two days later, on 25 March, the application was issued Mr Lazur submits that it must have been in contemplation at the time the request was made, leaving Lloyds with no reasonable opportunity to respond to the request that had been made.[8]In due course Lloyds offered £850,000 by way of additional security. That offer was rejected and Accor continued to ask for £3.3 million in respect of disclosure alone. However, since then, on 21 April 2026, Lloyds offered, in total, £2.15 million by way of additional security. That was responded to by Haynes Boone a few days later still asking for £4.4 million of additional security. Following a final attempt from Hill Dickinson to reach agreement and making an offer of £2.3 million, there was settlement of the security application by the acceptance yesterday of that offer.[9]Mr Lazur’s submission is that in those circumstances, the court should approach the matter on the basis that the application was premature or unnecessary and that had Accor given Lloyds an appropriate and reasonable opportunity to enter into discussions about the provision of additional security, that position could have been reached without the need for any application and the costs dependant on that application. In any event, the amount of additional security that Accor has obtained is only slightly more than that that was offered on 21 April 2026. In those circumstances he submits both that Lloyds should be regarded as the successful party and/or that taking account of the conduct of Accor and the exaggeration of the claim for security, the order ought to be in his favour. He submits that about 80 per cent of all the costs were expended on the security application, all the other matters were relatively minor matters and indeed on one of the matters the production of the family documents, Lloyds have been entirely successful.[10]Persuasive though that submission is, I am afraid that I do not accept it. In my judgment Mr Spence is right to say that this application had to be issued in order to obtain substantial further security. As he rightly says, the first request for further security was in January 2026 and there was simply no response or no attempt to engage. The next request which preceded the application - even though shortly before the application - was, of course, for a very, very substantially greater sum but no offer was made until 8 April in response and that was then in a wholly different sum of £850,000 which is nowhere near the amount of £2.3 million that was eventually offered and agreed.[11]I have some sympathy for the suggestion that there ought to have been more engagement prior to the application being issued in March but what happened after it demonstrates, to my mind, that the application was necessary in order to bring the matter to a head, even taking account of the observations made by Constable J at a previous hearing that the parties should seek to reach agreement before proceeding to issue applications to the court.[12]I therefore regard Accor as having been the successful party on the security application. Given the amount of security that has been obtained, there is inevitably some merit in the submission that the amount that was claimed was exaggerated. Otherwise, as Mr Lazur has said, quite simply Accor would not have accepted an agreed figure of £2.3 million additional security. But that can be taken into account in a percentage reduction to the recovery of costs or in the summary assessment.[13]Insofar as the other matters are concerned, it seems to me that although they might have been relatively minor matters and have not troubled the court to a great extent, that is in almost every instance ,apart from the matter of the family documents, because of offers that were made or steps that were taken very close to the time of the hearing and that ought to be reflected in an order for costs. It is right that Lloyds have been successful on the matter relating to the family documents. That took up relatively little time in the witness evidence, unlike the more general issues of the privilege review which took up a very substantial part of the witness evidence and on which Lloyds essentially conceded that they had got something wrong and that the independent review needed to proceed.[14]In those circumstances and taking account both of the issue of “exaggeration” and the lack of success in relation to the family documents, I am going to deal with the matter of costs by ordering Lloyds to pay 75 per cent of whatever the sum is that I am about to summarily assess in relation to the costs bill. So I am going to take a percentage approach to a reduction to the recovery of costs to reflect the matters I have referred to. (Following further submissions)[15]On the statement of costs, Mr Lazur makes three submissions, the first is that the number of letters to opponents or the time spent on corresponding with opponents is excessive, was almost entirely spent on quantum of security and should be reduced from approximately £14,000 to £10,000.[16]I think there is merit in that submission to the extent that there is and always has been in this case a quite extraordinary level of correspondence but, at the same time, the matters that have been addressed have been dealt with in some degree of detail and contributed to by what Mr Spence described as the last minute scattergun approach. It is apparent that those matters could have been dealt with much earlier and in a much more orderly fashion and not doing so is not the fault of Accor and is likely to have generated more correspondence. I will therefore make a reduction but only of £5,000, not £10,000.[17]The second two points that Mr Lazur takes I will myself take together. The first is that there is, in terms of work on documents, too much time spent by too many people, including three grade A fee earners although at slightly different hourly rates. It is, I am afraid to say, a feature of this case that every witness statement is extremely long and is then accompanied by a skeleton argument, or a so-called skeleton argument, that, in very large measure, repeats the contents of the witness statement. That has happened again here and it seems to me that some reduction to the work and hourly rates ought to be made to reflect that.[18]At the same time Mr Lazur submits that Mr Spence’s hourly rate is above the guideline rate for a grade C fee earner. Mr Spence, in his own defence, says that he hoped that the work that he had done is of a standard and a value that may be greater than expected of a grade C fee earner and I would very much hope that that is right. But the rather more significant point is that the more work that is done by a junior person the more supervision is required by more senior people. So, taking those two points together, I will make the reduction that Mr Lazur asks for to the sums claimed in respect of Mr Spence’s work, that is a reduction of £7,000, making it clear that that has absolutely nothing to do with the quality of his work, but I will not make the reduction to the work done on documents by the grade A fee earners to reflect the fact that they are supervising and checking the work of someone significantly more junior. Therefore, taking those two together, that is a reduction of £12,000. --------------- This transcript has been approved by the Judge