The Issues:

During the course of litigation the defendant made a Part 36 offer of £360,000.00.  That offer was not accepted, it was not withdrawn.  The trial started and evidence was heard over two days.  During the trial the claimant applied for permission to accept the Part 36 offer.  The defendant objected.

The Rules – CPR 36.11 means that a party requires permission of the court to accept a Part 36 offer in certain circumstances.

(3) The court’s permission is required to accept a Part 36 offer where –

(d) a trial is in progress.

The Judge reviewed three authorities when considering this case: Capital Bank Plc v Stickland [2005], Sampla and others v Rushmoor Borough Council and another [2008] and Nulty v Milton Keynes BC [2012].  It was right that the rules under Part 36 were different at the time of those cases.  Version 1 was considered in the Capital Bank case; version 2 was considered in the two other cases. 

The Judge considered the approach in Sampla and Nulty and commented: “They indicated in strong and, I have to say persuasive terms that if an offeree, when he sees the way the wind is blowing in the trial changes his attitude and wants to accept an offer that he previously did not want to accept, that is a change of circumstances which means that it may no longer be appropriate to allow the offeree to accept the offer which is still on the table subject to the court’s permission”.

Held:

The Judge was asked to impose upon the defendant a liability to pay £330,000.00 which it was no longer willing to do as it had asked the Court to refuse permission.  The Judge when considering exercising the Court’s discretion held that where a claimant decides to take his chances with the trial and then repents his earlier decision to turn down the offer of settlement because the trial, he thinks is going less well or more badly than predicted, that the court will often take the view that it is not right to give permission to impose a settlement on the reluctant defendant.  The Judge concluded “Taking that approach does not mean that permission will never be given.  In the course of argument, examples were given of when permission would be appropriate, but those examples to not apply to this case.  Having endeavoured to assess the points in play, my overall conclusion is that the just result here is to refuse permission to the claim to accept the Part 36 offer”.

Comment:

The intention behind the introduction of QOCS was to negate the need for a Claimant to obtain ATE insurance.  However, this case again highlights the importance of ATE where a Claimant fails to beat a Defendant’s Part 36 offer and is again at risk for the Defendant’s costs from the relevant offer period.

[DOWNLOAD & VIEW JUDGMENT]

< Back to case list