WS8 - Settlement Flashcards
1
Q
Introduction to P36 Offers: What is the relevant CPR for P36 offers?
A
CPR 36.
2
Q
Introduction to P36 Offers - a) Role: What does P36 set out?
A
- Describes a kind of offer a party can make
- Sets out consequences if an offer of that kind is made and accepted; and
- Sets out difference consequences if offer is made and not accepted and matter proceeds to trial.
3
Q
Introduction to P36 Offers - a) Role: What is the difference between court discretion on costs and consequenes of P36?
A
- Court has wide discreiton for awarding costs and will consider conduct of both parties.
- However, advantage of P36 is that the financial incetive contained are more certain and go beyond what court can generally order.
4
Q
Introduction to P36 Offers - a) Role: What is the difference between P36 and a usual offer?
A
- P36 contains self contained procedural cover goerning offers made pursuant to the procedure.
- Normal contractual rules of offers and accepted do not apply.
5
Q
Introduction to P36 Offers - b) Who: Who can make?
A
Either party. (So rules refer to offeree and offeror.)
6
Q
Introduction to P36 Offers - b) When: When can they be made?
A
Any stage of proceedings,, including before they are issued.
7
Q
Introduction to P36 Offers - c) Difference from Calderbank offers: What is a Calderbank?
A
An offer, usually communicated in writing and written “without prejudice saver as to covers” such that it cannot be referred to judge until costs are considered, and therfore do not need to comply with P36.
8
Q
Making a P36 Offer: What are the relevant sections of CPR?
A
CPR 36.5-36.7
9
Q
Making a P36 Offer - a) How to make a valid P36: What do the rules in 36.5 set out?
A
36.5 for Claiamnts and Defendants, the offer must:
* Be in writing
* Make it clear it is made pursuant to P36
* Specify a period of not less than 21 days whithin which defendant will be liable for claimants costs if offer accepted (known as relevant period)
* State whether it relates to whole or part of claim and
* State whether it takes into account any counterclaim
10
Q
Making a P36 Offer - a) How to make a valid P36: What is the relevant period?
A
A period of not less than 21 days, specified in P36 offer within which D will be liable for C’s costs iff offer accepted.
11
Q
Making a P36 Offer - a) How to make a valid P36: What additional rules apply to Defendant P36’s?
A
CPR 36.6:
* With limited exception, P36 by Defendant to pay sum in settlement must be an offer to pay a single sum of money.
* A defendat’s offer that includes an offer to pay all or part of sum at date later than 14 days of acceptance will not be treated as P36 unless offeree accepts.
12
Q
Making a P36 Offer - a) How to make a valid P36: What format are they typically made in?
A
- Wide definition of writing means it can be by letter, which is usually the case.
- If letter used, somewhere is should state it is made pursuant to P36.
- Altneratively, there is a prescribed form N242A which if completed properly, would be a P36.
13
Q
Making a P36 Offer - b) When is P36 made: When is it considered made?
A
When it is served on the offeree - CPR 36.7(2)
14
Q
Making a P36 Offer - b) When is P36 made: What other rules therefore apply?
A
Rules of service - CPR 6.
15
Q
Making a P36 Offer - b) When is P36 made: What is position for consequences and pre-issue P36?
A
- They have the usual Part 36 consequences including recoverable pre-action costs upon acceptance after issue of proceedings or upon judgment.
- If P36 made and also accepted before proceedingd commence, the consequences CPR 36.13 and 36.14 considered later in this section have no effectand the consequences are depedent on existing proceedings.
16
Q
Making a P36 Offer - c) Clarifying a P36: How is a P36 clarified?
A
- Offeree can seek clarification of the terms of the offer such as a breakdown of the components within 7 days of service - CPR 36.8
17
Q
Withdrawing a P36 Offer: What if the offer has been accepted?
A
It cannot be withdrawn or its terms changed - CPR 36.9(1)
18
Q
Withdrawing a P36 Offer: What if the trial has already started?
A
Courts permission is required to withdraw the offer.
19
Q
Withdrawing a P36 Offer: What if the relevant period has expired?
A
- Offer can be withdrawn or terms changed without court permission if relevant period expired.
- Offer can also be withdrawn outmatically if terms state so, which allows offeror to make an offer that is time limited - CPR 36.9(4)
20
Q
Withdrawing a P36 Offer: What if notice is given during the relevant period?
A
- Any notice to withdraw/change during will take effect at the end of the relevant period, if the offeree do not serve notice of accepteance during the relevant period.
- If they do, despite the notice to withdraw/change, the offeror can either allow acceptance or must apply to court for permission to withdraw or change (within 7 days of notice of acceptance, or if earlier, beofre first day fo trial)
21
Q
Withdrawing a P36 Offer: When may court give permission to withdraw/change?
A
If satisfied here has been change of circumstance since offer and it is in interests of justice to give permission.
22
Q
Accepting a P36 Offer - a) How: How do you accept?
A
- Serve written notice of acceptance on offeror - CPR 36.11(1)
- If the case is issued, acceptance also needs to be filed at court (No form, letter suffice.)
23
Q
Accepting a P36 Offer - a) How: When can P36 be accepted? (Potential Q)
A
An offer remains open for acceptance unless withdrawn - CPR 36.11(2), which is the case even after relevant period expired, unless offer expressed to be withdrawn automatically at end of relevant period.
24
Q
Accepting a P36 Offer - b) Consequences of acceptance: What should be considered on acceptance?
A
- Stay - The claim will be stayed and not continue to trial - CPR 36.14(1)
- Settlement sum
(a) If P36 includes offer to pay/accept single sum of money, D has 14 days from acceptance to pay settlement amount agreed unless otherwise agreed in writing - CPR36.14(6), failing which, C can enter judgement against D.
(b) If P36 does not include offer to pay/accept, then in event party fails to comply with whatever was agreed, aggrieved party can apply to court to enforce terms without need for seperate proceedings. - CPR 36.14(7) - Costs - Costs consequences of acceptance depend on when the offer was accepted.
25
**Accepting a P36 Offer - b) Consequences of acceptance - i) During relevant period:** What is the position if accepted during?
* Claimant is entitled to its costs of the proceedings up to date notice of acceptance served - CPR 36.13(a).
* Rationale is that accepting an offer, claimant will receive sum of money in settlement and therfore "won its claim".
26
**Accepting a P36 Offer - b) Consequences of acceptance - ii) Outside relevant period:** What is the position if acceptance after expiry?
* Court will determine liaiblity for costs unless party agree them, **but**
* Court must unless it considers it unjust to do so, order:
(a) Claimant be awarded costs up to date relevant period expired.
(b) Offeree to pay offerors costs for period from date of expiry of relevant period to date of acceptance.
27
**Accepting a P36 Offer - b) Consequences of acceptance - iii) Special rules where offer made less than 21 days before trial** What must court do in this situation?
* If parties do not agree liability for costs, court must detmine - CPR 36.13(4)
28
**Accepting a P36 Offer - c) Only relating to part of claim** What are the rules of acceptance where P36 only relates to part?
* If at time of acceptance, C abandons remainder of claim, they will only be entitled to costs relating to part of claim contained on offer, unless court orders otherwise.
* If, at time of acceptance, C does not abandon remainder, liability for costs will be determined by the court, unless parties can reach agreement about liaiblity.
29
**Consequences of unaccepted P36 offers at trial:** What is the main rationale behind P36?
* Parties who make realistic proposals to settle should get some benefit if they are not acccepted and it turns out at trial, they should have been.
* Part who is dragged to trial having tried to be reasonable, should be compensated.
30
**Consequences of unaccepted P36 offers at trial:** How do courts approach if penalties should be imposed?
This will depend on if the offer concerns is a claimant offer or defendant offer.
31
**Consequences of unaccepted P36 offers at trial - a) Defendant's offer, not accepted:** What two issues must you consider?
* Trigger - Does failure to accept the D's offer trigger any consequences?
* Consequences - If so, what are they?
32
**Consequences of unaccepted P36 offers at trial - a) Defendant's offer, not accepted - i) Trigger:** What is the trigger?
* Where a claimant fails to obtain a judgement more advantagous than D's P36 offer.
33
**Consequences of unaccepted P36 offers at trial - a) Defendant's offer, not accepted - i) Trigger:** How do you determine if more advtangeous?
* This means better in money terms, however small, so unless result is better in money terms than D's P36, failure to accept will have consequences.
* TO determine, comparison is made at date of judgement and as P36 deemed to include interest up to relevant period, interest after this date is ignored.** (So compare sum in P36 offer with quantum award with interest up the end of relevant period)**
34
**Consequences of unaccepted P36 offers at trial - a) Defendant's offer, not accepted - ii) Consequences:** What is the penalty imposed by court?
**Unless it considers it unjust to do so,** Court must order:
* Claimant pays the D's costs from date of the relevant period expiring.
* Interest on those costs - CPR 36.17(3)
Claimant would also then have to bear their own costs for this period also.
35
**Consequences of unaccepted P36 offers at trial - a) Defendant's offer, not accepted - ii) Consequences:** What is position for costs prior to expiry of relevant period?
P36 does not set this out, so the usual costs rules apply - CPR 44 in which generally costs follow the action, **however, court has discreiton on this issue**
We will now appy the Penalty and costs prior to expiry of relevant period to some examples.
36
**Consequences of unaccepted P36 offers at trial - a) Defendant's offer, not accepted - iii) Application examples:** How will trigger and consequence apply if final judgement is less or same as P36 offer?
* Trigger - Claimant has failed to obtain judgement more advantageous than D's P36 Offer, consequences will therefore apply.
* Consequences - Defendant will get its costs from expiry of relevant period and interest on these costs, unless unjust - CPR 36.17(3)
Likely claimant will get its costs up to end of relevant period under normal costs rules, but this is at courts discretion.
37
**Consequences of unaccepted P36 offers at trial - a) Defendant's offer, not accepted - iii) Application examples:** How will trigger and consequence apply if final judgement made in favour of D?
* Trigger - Claimant has failed to obtain judgement more advantageous than D's P36 Offer, consequences will therefore apply.
* Consequences - Defendant will get its costs from expiry of relevant period and interest on these costs, unless unjust - CPR 36.17(3)
Likely claimant will get its costs up to end of relevant period under normal costs rules, but this is at courts discretion.
38
**Consequences of unaccepted P36 offers at trial - a) Defendant's offer, not accepted - iii) Application examples:** How will trigger and consequence apply if final judgement made in favour of C?
* Trigger - C did not fail to obtain judgement more advantagous than D's P36.
* Consequence - No consequences under P36 and likely Claimant will get costs for whole claim under normal cost rules.
39
**Consequences of unaccepted P36 offers at trial - b) Claimant's offer, not accepted:** What is the same as Defendant's?
You will consider:
* Trigger - Does failure to accept the D's offer trigger any consequences?
* Consequences - If so, what are they?
40
**Consequences of unaccepted P36 offers at trial - b) Claimant's offer, not accepted i) Trigger:** What is the trigger?
* Where judgement against defendant is at least as advangeous to the claiamnt as proposals in P36.
* So, if Claimant does **same or better (so can do same unlike above)** then you will consider consequences.
* The compairson for more advantegous is the same as above.
| Potential MCQ for knowing can do same for C but not for D
41
**Consequences of unaccepted P36 offers at trial - b) Claimant's offer, not accepted - ii) Consequences:** What penalty will be imposed on D in these circumtstances?
**Unless it considers unjust to do so, court must order:**
* Interest on the award at a rate not exceeding 10% above base rate for some or all of the period from expiry of relevant period. (Penalty as % is higher than usual rate)
* Costs from end of relevant period are to be assesed on indemnity basis rather than standard leading to significantly higher costs.
* Interest on those costs at a rate not exceeding 10% above base rate.
* An additional amount based on a % of the award, with % bein 10% up to £500,000 and 5% above with total additional amoutn capped at £75k. (If it is non-money claim, then the total costs awarded is used as a figure in place of award)
42
**Consequences of unaccepted P36 offers at trial - b) Claimant's offer, not accepted - ii) Consequences:** What if C does worse at trial?
Claimant P36 offer has no effect.
43
**Consequences of unaccepted P36 offers at trial - b) Claimant's offer, not accepted - ii) Consequences:** What if claims subject to FRC?
Instead of indemnity costs, additional costs awarded are on amount equivalent to 35% of the difference between fixed costs for stage applicable when relevant period expires and stage applicable at date of judgement.
44
**Consequences of unaccepted P36 offers at trial - b) Claimant's offer, not accepted - iii) Application examples:** What if final judgement for claimant more than offer?
* Trigger - Claimant obtained judgement at least as advangeous offer, in fact mure more.
* Consequence - Claiamnt gets:
(a) Indemnity costs from end of relevant period
(b) Interest on those costs up to 10% above base rate
(c) Itnerest on damages up to 10% above base rate (from end of relevant period)
(d) An additional amount (in this case) of £75,000 unless unjust.
45
**Consequences of unaccepted P36 offers at trial - b) Claimant's offer, not accepted - iii) Application examples:** What if final judgement for claiamnt less than offer?
* Trigger - Claimant has not obtained judgement at least as advantageous, C's offer has no consequences.
* Consequences - No consequence under P36.
46
**Consequences of unaccepted P36 offers at trial - b) Claimant's offer, not accepted - iii) Application examples:** What if final judgement for defendant?
* Trigger - Claimant has not obtained judgement at least as advantageous, C's offer has no consequences.
* Consequences - No consequence under P36.
Defendant likely get its costs for whole claim under normal costs rules as they have won the claim, but this at courts discretion.
47
**Consequences of unaccepted P36 offers at trial - c) Unless unjust to do so:** When is this relevant?
We set out above, where P36 consequences triggered,penalities will be imposed unless court considers it unjust to do so.
48
**Consequences of unaccepted P36 offers at trial - c) Unless unjust to do so:** What will court take into account when deciding what is unjust?
* Terms of any P36 offer
* Stage in proceedings offer made
* Information available to parties
* Conduct of parties in relation to giving/refusing information to enable offer to be made/evaluated.
* Whether offer was genuine attempt to settle.
49
**Consequences of unaccepted P36 offers at trial - d) Special rules for both C's/D's P36 not accepted:** What is the position if offer made within 21 days of trial?
* Even if applicable trigger set out above satisifed, there will be no P36 conseqeunces unless court abridges relevant period (shortens it)
* This is to ensure fairness as 21 day period not expired so offeree did not have fair opporunity to accept.
50
**Consequences of unaccepted P36 offers at trial - d) Special rules for both C's/D's P36 not accepted:** When else do P36 consequences not apply?
* If offer was withdrawn or
* P36 offer was changed so terms are less advantgeous to offeree and offeree has beaten the less advantageous offer.
51
**Consequences of unaccepted P36 offers at trial - e) Open C's/D's offers effective at same time** How must you approach this?
* Simply consider each offer in turn. See examples below
52
**Orders following settlement:** What are the relevant sections of CPR?
CPR 40
PD 40B
53
**Orders following settlement - a) Consent Orders** What is usual once matter settled between parties?
* Usual for that settlement to be recorded in consent order which has effect of nomrla court order but indicates parties agree the terms set out.
54
**Orders following settlement - a) Consent Orders** What are the two types?
* Consent order based on contract: The consent order is evidence of contract between parties and therfore, will be rarely interfered with by court.
* Consent order not based on contract - This is not a contract but simply parties agreeing terms of settlement, so such order may be varied by court.
55
**Orders following settlement - a) Consent Orders** What happens once consent order entered into?
A defence of estoppel may be avialable if fresh rpoceedings are brought regarding matters in agreement, but this will depend on exact wording.
56
**Orders following settlement - b) Tomlin Orders:** What is this order?
It is a type of consent order which is made up of two parts, the first part is the public part and the second the condiential par which contains details of agreement reached.
57
**Orders following settlement - b) Tomlin Orders:** What will part 1 of the order look like?
Known as the order -
* Looks like any other consent order
* Public
* Contains actions to be taken by the court and enforcable by it such as:
(a) Stay
(b) Permission to apply
(c) Detailed assessment of costs?
**Note - Any direction for payment of money out of court of costs assessment must be in Part 1 as requires action of court so much be in public part. **
58
**Orders following settlement - b) Tomlin Orders:** What will part 2 of order look like?
* Generally confidential
* Contains terms of agrement - enforceable with further court order
* Enables parties to include provisions beyond those a court order would order
59
**Orders following settlement - b) Tomlin Orders:** When are these orders generally used?
* Parties wish for key settlement terms to be confidential; and/or
* When the agreed settlement terms go beyond those that court could generally order in proceedings.
60
**Orders following settlement - c) Putting consent/tomlin order in place:** What is still required?
* While they felect agreement of parties, they still require court approval so must apply to court to ahve order made.
* If court makes the order, then it takes effect like any other order.
**Note, if settlement reached during stay, then application for consent/tomlin order treated as application to have stay lifted.**
61
**Orders following settlement - d) Recording a settlement before proceedings are issued:** What is the position for agrement pre-issue?
* If parties agree without proceedings, no need for consent order or Tomlin order.
* Instead, they will record it in settlement agreement, essnetially a form of contract.
62
**Orders following settlement - e) Consent orders and interim applications:** When else are consent orders relevant?
* Agreement can also be reached for interim applications.
* Such as, Claimant may need extension of time for exchange of witness statements if D willing, parties can agree up to 28 days without applying to court.
* However, if they want to agree longer, an application to court usually required.
63
**Orders following settlement - e) Consent orders and interim applications:** What will applicant do in addition to application to court?
* Consent order drawn up recording the agreement (e.g longer extension) and both parties indicate their agreemnt to this consent order.
* Consent order filed at court, ideally when application notice filed.
* Aplicant usually invite court to consider application on paper without hearing.
**Note - Court not obliged to approve such consent order and it is case management decision, but fact parties agreed it, makes it more likely.**
64
**Discontinuance:** What are the relevant sections of CPR?
* CPR 38
65
**Discontinuance:** What is discontinuance not?
* A form of settlement
* It is way for claimant to bring claim to end if it does not wish to proceed to trial but settlement not an option, such as weak case.
66
**Discontinuance - a) Nature of discontuance:** Who can discontinue?
* Only the Claimant
* They can do so at any time n which they choose not to pursue claim against D any further - CPR 38.2(1)
67
**Discontinuance - a) Nature of discontuance:** Can claim be discontinued in part?
* Yes and they can choose to discontinue against one or all D's.
68
**Discontinuance - a) Nature of discontuance:** What are the consequences?
* It ends proceedings in relation to claim/part of claim discontinued.
* Claimant is liable to pay D's costs to point of discontunance, unless court considers otherwise. (If part, then C only liable for costs relating to part disconinued.
69
**Discontinuance - a) Nature of discontuance:** Is courts permission needed?
Only in excetional circumstances, generally if C has already received some sort of remedy such as interim payment/injunction.
70
**Discontinuance - b) Procedure** What is the process?
