Part 36 Offer to Settle: Beware the consequences of withdrawing the offer
Part 36 of the Civil Procedure Rules (the rules of procedure used by the courts) is designed to encourage parties to settle by making offers. Part of the encouragement is the prescribed costs consequences if an offer is not accepted or beaten at trial. They can mean a bigger bill for the ‘loser’.
The High Court has refused to grant indemnity costs (which would benefit the ‘winner’), where a Part 36 offer was not accepted and was withdrawn 21 days after it was made. At trial, the claimant beat her own offer and sought indemnity costs. The Part 36 consequences no longer applied because the Part 36 offer had been withdrawn. A withdrawn Part 36 offer could play a part in assessing the reasonableness of the defendant’s conduct, but it’s not comparable with a “living Part 36 offer” just because it had been beaten. Gulati and others v MGN Ltd  EWHC 1805 (Ch) (24 June 2015) (Bailii).
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