W8 Flashcards

1
Q

What is the purpose of serving notice of withdrawal or change during the relevant period?

A

Serving notice of withdrawal or change during the relevant period allows the offeror to either allow the acceptance or apply to the court for permission to withdraw the offer or change its terms.

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2
Q

What is Part 36 and what does it describe?

A

Part 36 is a self-contained procedural code that describes a kind of offer, sets out consequences if an offer of that kind is made and accepted, and sets out different consequences if any offer of that kind is made and not accepted and the matter proceeds to trial.

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3
Q

What is the purpose of interest on costs in a legal case?

A

Interest on costs is meant to compensate the party for the time value of money and any financial losses incurred due to the delay in receiving the costs awarded.

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4
Q

What is the purpose of a Part 36 offer in a legal case?

A

A Part 36 offer is made by any party involved in a legal dispute. If accepted within the relevant period, the defendant will pay the claimant’s costs. If accepted after the relevant period, the usual rule is that the offeree pays the offeror’s costs after the expiry of the relevant period.

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5
Q

What is the aim of Part 36?

A

If an offer is accepted despite a notice of withdrawal or change being served, the offeror can either allow the acceptance or apply to the court for permission to withdraw the offer or change its terms.

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6
Q

How is the rate of interest on costs determined?

A

The rate of interest on costs is typically set at a rate not exceeding 10% above the base rate. However, this rate may be higher than the usual rate.

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7
Q

What is a Part 36 offer and can it be time-limited?

A

A Part 36 offer is a type of offer made in legal proceedings. It is possible to make a time-limited Part 36 offer, which means that the offer is only open for acceptance for a specified period of time.

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8
Q

What are the consequences of accepting a Part 36 offer in a legal case?

A

o Stay - The claim will be stayed and will not continue to trial – CPR 36.14(1)).
o Settlement sum - For any Part 36 offer which is, or includes, an offer to pay / accept a single sum of money, the defendant has 14 days from acceptance to pay the settlement amount agreed unless otherwise agreed in writing (36.14(6)), failing which the claimant can enter judgment against the defendant (CPR 36.14(7)).
o If the Part 36 offer does not include an offer to pay / accept a single sum of money, then in the event that a party fails to comply with whatever was agreed, the aggrieved party can apply to court to enforce the terms of the offer without the need to start separate court proceedings (CPR 36.14(8)).

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9
Q

How do Part 36 offers differ from Calderbank offers?

A

Part 36 offers are a specific type of offer governed by Part 36 of the Civil Procedure Rules. Calderbank offers, on the other hand, do not need to comply with Part 36 and have more flexibility in their drafting. However, the court will consider Calderbank offers when exercising its discretion on costs.

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10
Q

Is it possible to withdraw a Part 36 offer once it is made?

A
  • A Part 36 offer cannot be withdrawn after it is accepted, and there are limits on withdrawing it within the relevant period.
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11
Q

What are the consequences of accepting a Part 36 offer?

A

The consequences of accepting a Part 36 offer depend on whether it is accepted before or after the expiry of the relevant period. If accepted before the expiry, the claimant is entitled to its costs of the proceedings up to the date the notice of acceptance was served on the offeror. If accepted after the expiry, the court will determine liability for costs, with the claimant being awarded costs up to the date the relevant period expired and the offeree being liable for the offeror’s costs from the date of expiry to the date of acceptance.

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12
Q

How can a time-limited Part 36 offer be withdrawn?

A

If a Part 36 offer is time-limited, it can be automatically withdrawn in accordance with its terms, at the end of a specified period of time.

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13
Q

What is the likely impact of a Part 36 offer if a claimant does not accept it?

A
  • -If the claimant fails to beat a defendant’s offer, the penalty is the claimant being ordered to pay the defendant’s costs from the date the relevant period expired, and interest on those costs.
    o D’s Part 36 offer only ‘bites’ if C wins the same or less than D’s offer
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14
Q

What is the likely impact of a Part 36 offer if D does not accept it?

A
  • If the claimant does the same or better than its own offer, the penalty is the defendant being ordered to pay enhanced interest, indemnity costs and interests on those costs from the date the relevant period expired, plus a lump sum.

The Claimant’s Part 36 offer only ‘bites’ if the Claimant wins and receives the same or more than its offer.

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15
Q

Under what circumstances does a claimant’s Part 36 offer have no effect?

A

If the ‘trigger’ is not met, such as when the claimant does worse at trial than it offered to accept, then the claimant’s Part 36 offer has no effect.

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16
Q

How should a Part 36 offer be accepted?

A

o Serve written notice of acceptance on the offeror (CPR 36.11(1)).
o If the case is issued the acceptance also needs to be filed at court.
o There is no prescribed form for this - a letter will be sufficient.
 Important: An offer remains open for acceptance unless it has been withdrawn (CPR 36.11(2)). This remains the case even after the relevant period has expired, unless offer is expressed to be withdrawn automatically at the end of the relevant period.

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17
Q

Can a time-limited Part 36 offer have a time limit that is less than the relevant period?

A

Yes, a time-limited Part 36 offer can have a time limit that is less than the relevant period.

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18
Q

What is the likely impact of a Part 36 offer if a claimant accepts it?

A

If a claimant accepts a Part 36 offer, they will get their damages and a split costs order. This means that the defendant will have to pay the claimant’s costs until the relevant period expires, and thereafter, the claimant will have to pay the defendant’s costs plus interest.

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19
Q

What happens if an offer remains open for acceptance after the relevant period has expired?

A

If an offer remains open for acceptance after the relevant period has expired, it can still be accepted unless it is expressed to be withdrawn automatically at the end of the relevant period.

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20
Q

What are the requirements for a valid Part 36 offer?

A

ANSWER

A Part 36 offer must be marked as such, be in writing, state whether it applies to the whole or part of the claim or any counterclaim, and specify a period of at least 21 days when the defendant will be liable for the claimant’s costs if accepted. These rules apply to both claimants’ and defendants’ offers.

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21
Q

When can a Part 36 offer be made?

A

Part 36 offers can be made at any stage of proceedings, including before proceedings are issued. They can be made by either party and must conform to certain formalities to be considered valid.

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22
Q

What is the purpose of mediation in alternative dispute resolution (ADR)?

A

Mediation is a confidential process intended to facilitate the resolution of disputes through the medium of an impartial third party, known as the mediator. The mediator helps the parties reach a compromise or agreement to the satisfaction of both parties. The mediator does not have the authority to make any decision that is binding on the parties.

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23
Q

What is the role of an independent party in early neutral evaluation (ENE)?

A

In early neutral evaluation, an independent party is appointed by the parties involved in a dispute. The independent party provides a non-binding assessment of the matter referred to them. The assessment provides an impartial ‘opinion’ which might influence the parties in future decisions. The parties will have to pay the independent party for their time and costs.

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24
Q

What factors does the court consider when deciding what is unjust in relation to Part 36 offers?

A

When deciding what is unjust, the court will take into account the terms of any Part 36 offer, the stage in the proceedings when the offer was made, the information available to the parties, the conduct of the parties in relation to giving/refusing information for the purpose of enabling the offer to be made/evaluated, and whether the offer was a genuine attempt to settle.

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25
Q

What happens if an offeree accepts a Part 36 offer made less than 21 days before trial?

A

If an offeree accepts a Part 36 offer made less than 21 days before trial, the court must determine liability for costs unless the parties agree on them. The court must order that the claimant be awarded costs up to the date the relevant period expired and that the offeree pay the offeror’s costs for the period from the date of expiry to the date of acceptance, unless it considers it unjust to do so.

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26
Q

What is the purpose of arbitration in alternative dispute resolution (ADR)?

A

Arbitration is a process by which a dispute is resolved by an impartial adjudicator whose decision the parties to the dispute have agreed will be final and binding. By agreeing to arbitrate disputes, parties are agreeing to oust the jurisdiction of the court and give the jurisdiction to a different impartial party, the adjudicator.

27
Q

What happens if a Part 36 offer relates to part of a claim only?

A

If a Part 36 offer relates to part of a claim only, the consequences depend on whether the claimant abandons the remainder of the claim or not. If the claimant abandons the remainder, they will only be entitled to the costs relating to the part of the claim contained in the offer, unless the court orders otherwise. If the claimant does not abandon the remainder, the liability for costs will be determined by the court, unless the parties can reach an agreement.

28
Q

What is the process of med-arb in alternative dispute resolution (ADR)?

A

Med-arb is a process where parties initially try to resolve a dispute through mediation. If mediation does not result in a satisfactory resolution, the matter moves on to arbitration, where a binding determination is made. Med-arb combines the attempt at mediation with the option of arbitration if mediation fails.

29
Q

What is the purpose of conciliation in alternative dispute resolution (ADR)?

A

Conciliation involves an independent neutral third party in helping parties resolve their dispute. The process is usually facilitative, like mediation, but may occasionally involve more evaluation. The details of conciliation may vary depending on the specific nature of the process, as it often forms part of a statutory or regulatory scheme.

30
Q

What happens if a Part 36 offer is accepted before proceedings are commenced?

A

If a Part 36 offer is both made and accepted before proceedings are commenced, the Part 36 consequences of acceptance, including recoverable pre-action costs, apply upon acceptance after the issue of proceedings or upon judgment being given.

31
Q

What are the consequences of accepting a Part 36 offer in relation to a claim?

A

If a Part 36 offer is accepted, the claim will be stayed and will not continue to trial. For any Part 36 offer which is, or includes, an offer to pay or accept a single sum of money, the defendant has 14 days from acceptance to pay the settlement amount agreed, failing which the claimant can enter judgment against the defendant. If the Part 36 offer does not include an offer to pay or accept a single sum of money, the aggrieved party can apply to court to enforce the terms of the offer without the need to start separate court proceedings.

32
Q

What are the advantages of alternative dispute resolution (ADR)?

A

Advantages of ADR include saving time and money, privacy and confidentiality, greater empowerment and involvement of the parties, and a broader range of potential outcomes. Legal representatives must consider and advise their clients on ADR options when resolving civil disputes.

33
Q

What are the specific rules for defendants’ Part 36 offers?

A

Defendants’ Part 36 offers must be an offer to pay a single sum of money, with limited exceptions. If the offer includes payment at a date later than 14 days following acceptance, it will not be treated as a Part 36 offer unless the offeree accepts the offer.

34
Q

What happens when both the claimant and the defendant have made Part 36 offers that have not been accepted?

A

If both the claimant and the defendant have made Part 36 offers that have not been accepted when the matter goes to trial, each offer is considered separately. The consequences of the offers will depend on whether the judge awards an amount that is the same or more than the respective offer.

35
Q

How can a Part 36 offer be clarified?

A

The offeree can seek clarification of the terms of a Part 36 offer, such as a breakdown of the components of the offer, within 7 days of service.

36
Q

What factors should be considered when choosing a dispute resolution procedure?

A

When advising a client on a dispute, it is important to identify the most effective dispute resolution procedure, taking into account the nature of the dispute and the client’s commercial interests. A solicitor must consider and advise on the alternative dispute resolution (ADR) options available.

37
Q

What happens if a Part 36 offer is accepted after the relevant period?

A

If a Part 36 offer is accepted after the relevant period, the court will determine costs unless the parties agree otherwise. Unless unjust, the court must award the claimant its costs up to the expiry of the relevant period and the offeror its costs from that point onwards.

38
Q

What are the different types of ADR processes without third-party intervention?

A

Negotiation is a communication process between parties intended to reach a compromise or agreement. It is an ADR process without third-party intervention. Other types of ADR processes involve third-party intervention, such as mediation, early neutral evaluation, expert appraisal, and conciliation

39
Q

What is the purpose of negotiation in alternative dispute resolution (ADR)?

A

Negotiation is a communication process between parties intended to reach a compromise or agreement to the satisfaction of both parties. It is an ADR process without third-party intervention.

40
Q

What is the purpose of expert determination in alternative dispute resolution (ADR)?

A

Expert determination is a process where an independent expert on the subject matter is appointed by the parties to determine the dispute. The procedure is determined by the contract between the parties. This form of ADR is particularly suitable for disputes requiring technical knowledge but may not be suitable if the parties wish to be fully heard and there are issues of credibility.

41
Q

What is the purpose of Calderbank offers in relation to Part 36?

A

Calderbank offers do not need to comply with Part 36 and offer more flexibility in their drafting. Although the specific consequences of Part 36 do not apply to Calderbank offers, the court will consider them when exercising its discretion on costs.

42
Q

What are some potential advantages of using Alternative Dispute Resolution (ADR)?

A

Some potential advantages of ADR include better relationships, cost savings, time savings, greater privacy/confidentiality, less disruption, a range of outcomes, outcomes that reflect risks, parties in control, and parties being more involved.

43
Q

What is the purpose of a case management conference in relation to alternative dispute resolution (ADR)?

A

At a case management conference, the court is likely to want to know what steps the parties have taken to explore alternative dispute resolution (ADR). The court can give directions that are aimed at encouraging ADR.

44
Q

How does the court encourage parties to engage in ADR?

A

The court can provide information about ADR and encourage parties to consider ADR and engage in it. However, the court cannot generally compel a party to engage in ADR.

45
Q

What is the effect of discontinuance in a legal case?

A

Discontinuance takes effect from the date of service.

46
Q

What are the potential cost savings associated with ADR?

A

ADR can lead to cost savings compared to litigation. It can result in a resolution at a lower cost and can also conclude more quickly than litigation.

47
Q

What factors does the court consider when making a costs order in relation to ADR?

A

When making a costs order, the court considers the conduct of the parties, including compliance with pre-action protocols. The court can encourage parties to engage in ADR by rewarding positive ADR behavior and punishing poor behavior in costs.

48
Q

What happens to the costs order upon discontinuance?

A

Upon discontinuance, a costs order is deemed to have been made in the defendant’s favour on the standard basis.

49
Q

Under what circumstances might a party be penalized for refusing to engage in ADR?

A

If a party refuses to engage in ADR, the court will consider whether that refusal was reasonable. If the refusal was unreasonable, the court might impose a costs penalty. The burden of proof is on the unsuccessful party to show why it should depart from the general rule on costs to deprive the successful party of some or all of its costs.

50
Q

How does ADR allow outcomes that reflect risks?

A

In non-binding forms of ADR, the parties can agree on a settlement that reflects the risks to each side. For example, they can agree on a settlement amount that takes into account the possibility of winning or losing the case.

51
Q

What is the default costs order upon discontinuance?

A

Upon discontinuance, a costs order is deemed to have been made in the defendant’s favour on the standard basis.

52
Q

What are the consequences for a party that fails to suggest ADR?

A

The court will not refuse to award costs to a successful party simply because it did not positively suggest ADR. However, silence in the face of an offer to engage in ADR is likely to be considered unreasonable and may be sanctioned in costs.

53
Q

What are the main types of ADR?

A

the main types of ADR are negotiation, mediation, expert appraisal, conciliation, arbitration, and expert determination.

54
Q

Why is engaging in ADR early beneficial?

A

Engaging in ADR early leads to greater cost savings in the event of success and can start court proceedings off on a better footing. Even if unsuccessful, it can provide better relationships, useful information, and a clearer understanding of the case.

55
Q

Who can discontinue the claim?

A

The claimant

56
Q

Procedure for discontinuing the claim?

A
  • File a notice of discontinuance at court (CPR 38.3(1)(a)) (This must make clear which part of the claim is discontinued (if only part)).
  • Serve a copy on every party (CPR 38.3(1)(b))
  • Discontinuance takes effect from the date of service (CPR 38.5(1))
  • Upon discontinuance, a costs order is deemed to have been made in the defendant’s favour on the standard basis (CPR 38.6 and 44.9(1)(c)).
57
Q

How should a settlement be recorded?

A

A settlement should be recorded in writing, either in a settlement agreement or a consent order/Tomlin order. A consent order is an order drafted by the parties to reflect their agreement, while a Tomlin order includes a schedule that sets out terms that cannot go in a consent order.

58
Q

What are the various ways in which the court rules and courts can encourage ADR?

A

The court rules and courts can encourage ADR by including provisions in pre-action protocols, requiring provision for settlement negotiations in budgets, and confirming the need to try to settle a dispute in the Directions Questionnaire. The court can also penalize a party that unreasonably fails to engage in ADR.

59
Q

What is the nature of discontinuance in relation to a claim?

A

Discontinuance is when a claimant chooses not to pursue the claim against the defendant any further. It can apply to the whole claim or part of the claim. Discontinuance ends the proceedings in relation to the claim or part of the claim discontinued, and the claimant is liable to pay the defendant’s costs up to the point of discontinuance.

60
Q

A claimant is bringing a civil action against a defendant for £400,000. After exchange of witness evidence, the defendant serves on the claimant a Part 36 offer to settle in the sum of £300,000. The claimant rejects this offer and the case proceeds to trial where the claimant is awarded £300,000 (all figures are inclusive of interest). Which ONE of the following statements best describes the likely costs consequences?

A The defendant will pay the claimant’s costs before the expiry of the relevant period, and the claimant will pay the defendant’s costs from the expiry of the relevant period, pursuant to CPR Part 36, because the claimant failed to beat the defendant’s offer.

B The claimant will pay the defendant’s costs before the expiry of the relevant period, and the defendant will pay the claimant’s costs from the expiry of the relevant period, pursuant to CPR Part 36, because the claimant beat the defendant’s offer.

C The claimant will get its costs pursuant to the general rule because it has been successful at trial.

d The claimant will have to pay the defendant’s costs of the proceedings pursuant to the general rule because the claimant has refused a reasonable offer.

e There are no part 36 costs consequences, because the claimant rejected the defendant’s offer within the relevant period.

A

A

his is a Defendant’s part 36 offer. The claimant has failed to obtain judgment more advantageous than the offer (CPR 36.17(1)(a)) as it has obtained a judgment the same as the offer. This triggers Part 36 and it is likely that a split costs order (CPR 36.17(3)) may apply where the claimant will get its costs from the defendant up to the date on which the relevant period expires and the defendant will get its costs from the claimant thereafter. Note, however, that this outcome is not guaranteed – the court will not impose these Part 36 consequences if it considers them to be unjust.

61
Q

Your client, a supermarket, is about to enter into a contract with a new supplier of almonds and other nuts based in the USA. The supplier has proposed including an arbitration clause in the contract to resolve any disputes that may arise in future. The arbitration will have its legal seat in England. Your client is more familiar with litigation in the English courts and has generally been happy for its previous contractual disputes to be adjudicated with legal expertise to provide correct legal solutions. It has asked for your advice on arbitration. Which one of the following potential benefits of arbitration is likely to be most attractive to your client in its dealings with this supplier?

A Arbitration allows your client to have some input into the process

B Arbitration allows for easier international enforcement than litigation in the English courts

C The arbitrator can be experienced in the area of food supply.

D Arbitration is likely to be cheaper for your client than litigation in the English courts.

E Arbitration is likely to enable a legally correct solution to be achieved.

A

B

Correct. It is often easier to enforce an arbitration agreement (the reason for this is that the vast majority of countries are signatories to the New York Convention which means arbitration awards can be enforced internationally, whereas court judgments are more difficult to enforce and usually depend on there being a specific agreement between the two countries). This is important to the client given the supplier is in another jurisdiction because any judgment/award needs to be enforceable. In relation to the other answers, arbitration is rarely cheaper than litigation if the parties follow a very long and complicated process and the client has not said it is concerned about costs. Whilst the arbitration process allows for some flexibility in the process (subject to the mandatory rules in the Arbitration Act 1996 which provides a framework where the seat of the arbitration is in England/Wales), this is not a benefit of arbitration that is likely to be ‘most attractive’ to the client on the facts. Whilst arbitrators can have more expertise if available in the particular field (and this is a major benefit of arbitration), in this case, it is not something the client has mentioned it is concerned about. In fact, the client has previously been happy with judicial adjudication in the courts. Finally, arbitration allows for a legally correct solution to be achieved if the parties agree this, but so do court proceedings. So again this is not a benefit of arbitration that is likely to be ‘most attractive’ to your client.

62
Q

Your client is a producer of high-quality furniture. One of its long-standing suppliers provided it with sub-standard leather to cover its sofas. This resulted in the recall of the sofas and significant losses for your client. Your client has recently commenced court proceedings against the supplier to recover these losses. The supplier has proposed that the parties try to resolve the dispute by mediation and your client asks for your advice. Your client is not yet concerned about the increasing costs of the litigation as it has put aside a small fund to pay for it. The client believes it has a strong case so that any legally correct solution would be decided in its favour. It would like to continue to work with the supplier in future. Which of the following is most accurately describes the greatest benefit of mediation to your client?

A Mediation is a less adversarial process than court proceedings so it will enable the parties to maintain their commercial relationship in future.

B Mediation will save your client costs.

C Mediation will shorten the time spent on the dispute because the mediator can make a decision which will bring the dispute to a conclusion.

D Mediation is confidential.

E Mediation is more likely to provide a commercial resolution.

A

A

Correct. Mediation is less adversarial than court proceedings and so is a good choice if the parties wish to maintain their commercial relationship after the dispute has been resolved. In terms of the other answers, mediation will save costs if successful (although probably not otherwise), but this does not appear to be a key concern for your client. It will shorten the dispute if successful, but not because the mediator can make a decision – they cannot, they simply facilitate settlement. One of the benefits of mediation is that it is more likely to be a commercial resolution rather than a legally correct one, but this is not a clear benefit to our client who believes it has a strong case that will be decided in its favour. Mediation is indeed confidential, but your client has not identified this as a significant concern – perhaps the product recall has already publicised this issue so that this is no longer a critical concern

63
Q

The Claimant issues proceedings against Company A and Company B for breach of contract. Company A and Company B instruct their own solicitors and serve separate defences. Company A and Company B had worked together in a joint venture partnership and initially appeared equally liable for the breach of contract. On receipt of Company B’s defence, it becomes clear to the Claimant that there was no joint venture agreement and on re-assessing the documentary evidence, the Claimant only has a contract with Company A. What is the best course of action for the Claimant to take?

A Discontinue the claim against Company A and company B and issue new proceedings against Company A

B Apply for a stay of proceedings

C Discontinue the claim against Company B

D Apply for summary judgment against Company A

E Apply to strike out the particulars of claim against Company B

A

C

Correct. The Claimant can discontinue its claim against Company B by filing a notice of discontinuance at court and serving a copy of it on every other party to the proceedings (CPR 38.3(1)). Where there is more than one defendant, the notice of discontinuance must specify against which Defendant(s) the claim is discontinued (CPR 38.3(4)). The Claimant is likely to be required to pay Company B’s costs, but better to face that now than after losing against Company B at trial. In terms of the other answers, discontinuing against Company A and Company B and issuing new proceedings against Company A is going to be much more costly, and could be an abuse of process. A stay of proceedings would not solve the problem, nor are there grounds for summary judgment. The Claimant would not apply to strike out its own statement of case.

64
Q

You represent a claimant company which is bringing an action alleging negligence against its former surveyors, the defendant. The defendant makes an offer pursuant to Part 36 in an attempt to settle the action before the issue of proceedings. The next day, the claimant issues proceedings, but shortly afterwards decides it should accept the defendant’s offer.

Which one of the following is the best advice to the claimant should it wish to accept the defendant’s offer?

A Provided that the claimant accepts the offer within the relevant period, it will be entitled to damages and all of its costs up to the expiry of the relevant period.

B The claimant may accept the offer within the relevant period, but as the offer was made before proceedings were issued, Part 36 will not apply.

C The claimant may accept the offer within the relevant period and obtain damages and costs to the date the notice of acceptance is served.

D The claimant can accept the offer by filing a written notice of acceptance at court.

E The claimant must accept the offer within the relevant period or else the offer will automatically be withdrawn at the end of that relevant period.

A

C

Correct. A Part 36 offer may be made at any time, including before the commencement of proceedings (CPR 36.7). Pre-issue Part 36 offers have the usual Part 36 consequences, including recoverable pre-action costs, upon acceptance after issue of proceedings (or upon judgment being given).