5.4 Consequences of unaccepted Part 36 offers

Question 1

What are the costs consequences where judgment against D is at least as advantageous to C as the proposals in C’s offer?

Answer 1

CPR 36.17(4)
… the court must, unless it considers it unjust to do so, order that the claimant is entitled to—
(a)
[10% interest] for some or all of the period starting with the date on which the relevant period expired;
(b)
costs … on the indemnity basis from the date on which the relevant period expired;
(c)
[10%] interest on those costs; and
(d)
… an additional amount, which shall not exceed £75,000, calculated by applying the prescribed percentage set out below to an amount which is—
[10% on damages up to £500,000; 5% on damages over £500,000.]

Question 2

What are the costs consequences, where C fails to obtain judgment more advantageous than D’s Part 36 offer?

Answer 2

CPR 36.17(3)
… the court must, unless it considers it unjust to do so, order that the defendant is entitled to—
(a)
costs … from the date on which the relevant period expired; and
(b)
interest on those costs.

Question 3

What is a split costs order?

Answer 3

A split costs order occurs where -
(1)
under CPR 44.2 costs are awarded to C up to the end of the relevant period because C obtained damages; and
(2)
under CPR 36.17(3) costs are awarded against C after the end of the relevant period because C failed to obtain judgment more advantageous than D’s Part 36 offer.

Question 4

What will the court take into account when considering whether it is just to make special costs orders under Part 36?

Answer 4

CPR 36.17(5)
… the court must take into account all the circumstances of the case including—
(a)
the terms of any Part 36 offer;
(b)
the stage in the proceedings when any Part 36 offer was made, including in particular how long before the trial started the offer was made;
(c)
the information available to the parties at the time when the Part 36 offer was made;
(d)
the conduct of the parties with regard to the giving of or refusal to give information for the purposes of enabling the offer to be made or evaluated; and
(e)
whether the offer was a genuine attempt to settle the proceedings.

Question 5

What are the costs consequences where judgment against D is less advantageous to C than C’s Part 36 offer?

Answer 5

None - the court awards costs in its discretion under CPR 44.2.

Question 6

What are the costs consequences where C obtains judgment that is more advantageous to C than D’s Part 36 offer?

Answer 6

None - the court awards costs in its discretion under CPR 44.2.