Part 36 Offers - a vital tactic in litigation and out of court settlement

Summary

Part 36 offers are one of the most powerful tactical tools in English civil litigation. They provide a formal mechanism for parties to make settlement offers that carry significant costs consequences if unreasonably rejected. A well timed and well pitched part 36 settlement offer puts the opponent under pressure, can provide crucial protection on costs (which are often significant as legal disputes progress) and can lead to settlement. A Part 36 offer is a specific type of settlement offer which follows strict formalities and can triggers defined cost consequences if rejected by the recipient. A part 36 offer can be made by either claimant or defendant. The offer must :- * specify time period - must remain open for acceptance for at least 21 days (the 'relevant period') during which the cost consequences will apply. * be a genuine attempt to settle though it doesn't have to settle all aspects of the case (see below) * include clear terms capable of acceptance without further negotiation. If a Part 36 offer is rejected and at trial the claimant either loses or recovers less/only marginally more than the offer, they face serious costs consequences from the date the offer expired (in.

Key information

• •state that it is made under Part 36
• •specify time period - must remain open for acceptance for at least 21 days (the 'relevant period') during which the cost consequences will apply.
• •be a genuine attempt to settle though it doesn't have to settle all aspects of the case (see below)
• •include clear terms capable of acceptance without further negotiation.
• •being ordered to pay the defendant's costs (subject to assessment if not agreed) from the expiry date of the offer (typically 21 days after it was made), including interest.
• •they may be ordered to pay enhanced interest on those costs (up to 10% above base rate)
• •possibly have to pay an additional penalty of up to 10% of the first £500,000 awarded and 5% of any amount above that (capped at £75,000)
• •Individual issues/elements within a claim (e.g., liability only, or just quantum)
• •Specific heads of damage or parts of a claim
• •Specific issues in dispute (e.g., causation)
• •Individual claims within proceedings with multiple claims
• •Part 36 offers are one of the most powerful tactical tools in English civil litigation. They provide a formal mechanism for parties to make settlement offers that carry significant costs consequences if unreasonably rejected. A well timed and well pitched part 36 settlement offer puts the opponent under pressure, can provide crucial protection on costs (which are often significant as legal disputes progress) and can lead to settlement.

Practical guidance

• •Source: [Part 36 Offers - a vital tactic in litigation and out of court settlement](https://www.taylor-rose.co.uk/posts/part-36-offers)

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