Part 36 Offers

Question 1

What is a Part 36 offer?

Answer 1

• An offer to settle
• without prejudice save as to costs

Question 2

When can a Part 36 offer be made?

Answer 2

• Any time
• If a Part 36 offer is made less than 21 days before trial, the automatic costs consequences will not follow and its effect on costs will be at the discretion of the court

Question 3

What must a Part 36 offer contain?

Answer 3

• Be in writing
• State on its face that it is intended to have the consequences of Part 36
• Specify a period for acceptance of not less than 21 days within which the defendant will be liable for the claimant’s costs if the offer is accepted (the “relevant period”)
• State whether it relates to the whole of the claim or to part of it or to an issue that arises in it and, if so, to which part or issue
• State whether it takes into account any counterclaim
• Contain sufficient information to allow the offeree to consider the offer which will be necessary where the offer relates to a non-money claim.

Question 4

What are the costs consequences of a Part 36 offer?

Answer 4

If accepted within the relevant period:

• The claimant is entitled to his costs of the proceedings up to the date of acceptance on the standard basis
• The claim is stayed upon the terms of the offer.

If accepted after expiry of the relevant period:

• The parties must agree the liability for costs or, failing agreement, the court decides liability for costs
• The claim is stayed upon the terms of the offer.

Question 5

What if a Part 36 offer is not accepted?

Answer 5

• Adverse costs consequences apply if a defendant fails to accept a Part 36 offer and the claimant equals or betters that offer at trial.
• For a claimant who fails to accept a defendant’s Part 36 offer and then fails to better that offer at trial adverse costs consequences will apply.