A High Court Judge has ruled that a claimant’s 90/10 liability offer did not meet Part 36 requirements.

By way of background the claimant Mundy pursued a holiday sickness claim against TUI and in the course of litigation the defendant made a Part 36 offer to settle for £4,000.00.

The claimant’s representatives had sought an award of general damages of between £25,000.00 and £35,000.00 following his infection through the ingestion of contaminated food on a TUI holiday in Mexico.  The judge found that whilst the illness had been ‘very unpleasant’, it was not as severe or long-lasting as Mundy had claimed.  The judge awarded £3805.00 in damages.

As the claimant’s representatives had made an offer previously on liability at 90/10 it was submitted that the claimant had effectively ‘beaten’ this offer by securing a 100% liability outcome.

However, the judge did not agree that the split liability offer could be applied to Part 36 rules and as the claimant’s damages were less than the defendant’s monetary Part 36 offer, and he ruled that the claimant should meet the costs incurred after that offer was made.

The judge in his ruling commented:

‘Trying to do so strains the language of the provision, undermines its careful balance, and introduces a degree of complexity and uncertainty which I am not persuaded is within its contemplation,’ she said. ‘The effect proposed by Mr Mundy in this appeal goes far beyond incentivising the avoidance of a liability trial. It makes a 90/10 liability offer into a means for a claimant, who fails to beat a money offer to settle his claim, to recoup a substantial premium for "winning" the case nevertheless.’

It has been for some time the practice of claimant lawyers to make split liability offers in an attempt to secure costs advantages.  The most important lesson arising out of this judgement is that such a split liability offer may not confer the benefits of Part 36 on the claimant where there are other effective Part 36 offers in play.

Cases of this kind will depend on the precise wording and terms of the Part 36 offer and taking into account the upcoming QOCS changes coming into effect from 6^th April 2023, it would prudent for claimants to simply make sensible monetary offers or quantifiable offers on parts of claims.

Practitioners will also be wise to consider whether they have the increased need for ATE cover to protect their clients against adverse costs claims.

---------------------------------------------------------------------------------------------------

Here at Box Legal we have been offering after the event legal expense insurance since 2004 and have a wealth of experience. We have competitively priced ATE insurance policies available for all types of personal injury claims (including policies priced and suitable for the new whiplash regime) and can also arrange legal expense insurance cover for non-personal injury claims such as housing disrepair and financial mis-selling matters.

The number and variety of cases we arrange cover for is always increasing and so please contact us to discuss any after the event insurance requirements. We are happy to discuss and develop ATE insurance for case types we do not already insure.

If you would like to speak to us or obtain further information then please call on 0870 766 997, or email info@boxlegal.co.uk