Part 36 Offer

Part 36 of the Civil Procedure Rules sets out a self-contained procedure for offers to settle. As CPR rule 36.1 states, this Part contains a self-contained procedural code about offers to settle made pursuant to the procedure set out in this Part ('Part 36 offers'). Either a claimant or a defendant can make one, and once the 'relevant period' for accepting it has expired without acceptance, the offer carries automatic costs and interest consequences designed to encourage settlement.

Under CPR rule 36.17, those consequences bite where a claimant fails to obtain a judgment more advantageous than a defendant's Part 36 offer, or where judgment against the defendant is at least as advantageous to the claimant as the proposals contained in a claimant's Part 36 offer. Where a defendant's offer is not beaten, the court must (unless it is unjust) order that the defendant recovers costs from the date the relevant period expired, plus interest. Where a claimant beats its own offer, the court must order that the claimant recovers costs (including any recoverable pre-action costs) on the indemnity basis from the date on which the relevant period expired, interest on the sum awarded, interest on those costs, and — subject to a cap of £75,000 — an additional uplift calculated as a percentage of the sum awarded.