15. Part 36 Offers

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It is by no means unusual during the course of litigation for an offer to settle or indeed several such offers to be made.

Under Part 36 of the CPR and the accompanying Practice Direction, a formal offer to settle all or part of the dispute can be made in any type of case except those allocated to the small claims track.

If a Part 36 offer is made, it must be given careful consideration in view of the cost penalties associated with the rejection of a reasonable offer.

Under CPR 36.2(2), a Part 36 offer must:

(a) be in writing;

(b) state on its face that it is intended to have the consequences of Part 36;

(c) specify a period of not less than 21 days within which the Defendant will be liable for the Claimant's costs in accordance with rule 36.10 if the offer is accepted;

(d) state whether it relates to the whole of the claim or to part of it or to an issue that arises in it and if so to which part or issue; and

(e) state whether it takes into account any counterclaim.

Under CPR 36.2(4), a Part 36 offer must contain such further information as is required by rule 36.5 (Personal injury claims for future pecuniary loss), rule 36.6 (Offer to settle a claim for provisional damages), and rule 36.15 (Deduction of benefits).

Furthermore, under CPR 36.2(5) a Part 36 offer can be made solely in relation to liability.

Part 36 offers are made ‘without prejudice save as to costs’.

This means that third parties, including others involved in the action and even the judge in the case are not entitled to know the details of the offer.

These are kept between the offeror and the offeree.

If a defendant makes a Part 36 offer, their liability for costs ceases once the offer is accepted.

Accepting a Part 36 Offer

Whether or not to accept a Part 36 offer is ultimately the decision of the client, following advice from their solicitor.

If the client decides to accept, this can be done at any time as long as the offer has not been amended or withdrawn.

Acceptance should be in writing.

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