The Court of Appeal has given judgment in Broadhurst v Tan and it’s some good news for Claimant’s. As an ATE Insurance provider, here is our view:

The Issues

The Court heard appeals on two cases (Broadhurst v Tan and Smith v Taylor) as to whether fixed costs should apply when a Claimant beats their own Part 36 offer.

In Broadhurst the judge held that fixed costs continued to apply. Whereas in Smith the judge held that fixed costs were inconsistent and did not apply before awarding the Claimant indemnity costs. So which is the right policy to adopt?

The Result

The Court of Appeal upheld the decision in Smith and allowed the Claimant’s appeal in Broadhurst.

Comment

Don’t get too carried away with these decisions.

Essentially, where a claimant makes a successful Part 36 offer in a section IIIA case, fixed costs will be awarded to the last staging point provided by rule 45.29C and Table 6B. The Claimant will then be entitled to costs to be assessed on the indemnity basis in addition from the date that the offer became effective.

The onus remains on the Claimant to make their Part 36 offer as attractive and as early as possible, preferably before proceedings have been issued in order to gain the full benefit of indemnity costs.

Defendants will need to be alive to the fact that the fixed costs will cease to apply if a Claimant beats their own offer. The upshot is that Claimants could obtain a generous result in terms of costs if their Part 36 offers are pitched correctly.

If your client fails to recover more than the defendant has previously offered, does your After the Event Insurance policy provide any cover (ie. fails to "beat a Part 36 offer"? Ours does!