Part 36 Offer vs Calderbank Offer
Comparing the automatic costs consequences of a CPR Part 36 offer with the discretionary costs effect of a Calderbank (without prejudice save as to costs) offer.
Overview
Offers to settle civil proceedings can take two main forms: a Part 36 offer compliant with CPR Part 36, or a Calderbank offer (a 'without prejudice save as to costs' letter). Both are designed to encourage settlement, but their costs consequences differ fundamentally. A valid Part 36 offer triggers automatic costs consequences under CPR r.36.17 if the offeree fails to beat the offer at trial. A Calderbank offer (originating from Calderbank v Calderbank [1976] Fam 93) is shown to the costs judge after trial and may influence the exercise of the court's general costs discretion under CPR r.44.2, but carries no automatic consequences. Part 36 applies to claims in the County Court and High Court, but not (in its full form) to arbitration or most tribunal proceedings, where Calderbank offers remain the primary settlement tool. Since the 2013 reforms, Part 36 also applies to appeals. From April 2023, fixed costs under CPR Part 45 have affected the Part 36 uplift in fixed-costs cases.
Side-by-Side Comparison
Part 36 Offer (CPR Part 36)
Pros
- Automatic costs consequences under CPR r.36.17 if the offeree fails to beat the offer — offeree pays offeror's costs from end of relevant period, plus interest on costs and an additional amount (up to £75,000)
- Certainty — the consequences are set by rule, not judicial discretion
- Can be made by either claimant or defendant; different (and powerful) consequences apply to claimant Part 36 offers
- Widely understood — judges and costs officers are familiar with the regime
Cons
- Strict formal requirements — non-compliance (e.g. wrong relevant period, missing elements) invalidates the offer
- The 21-day relevant period must expire before costs consequences arise
- In fixed costs cases (CPR Part 45), the Part 36 uplift is limited to a percentage of fixed costs, not assessed costs
- Cannot be used in most tribunal proceedings or arbitration
Best For
All County Court and High Court litigation where you want certainty of costs consequences if the other side fails to accept a reasonable offer.
Calderbank Offer (Without Prejudice Save as to Costs)
Pros
- Flexible — no strict formal requirements; can be used in tribunal proceedings, arbitration, and family cases
- Can be tailored to include non-monetary terms that a Part 36 offer cannot easily accommodate
- Admissible before the costs judge and may result in a costs order against a party who unreasonably refused
- Useful where CPR Part 36 does not apply (Employment Tribunal, arbitration, FOIA appeals)
Cons
- No automatic costs consequences — the judge has full discretion and may decline to penalise the refusing party
- Less predictable than Part 36 — the costs consequences depend entirely on judicial discretion
- Less well understood outside civil litigation — its effect in some tribunals is uncertain
Best For
Settlement offers in tribunal proceedings, arbitration, family cases, or where the claim involves complex non-monetary terms that do not fit neatly within CPR Part 36.
Key Differences
Our Recommendation
In County Court and High Court proceedings, always consider making a Part 36 offer where you want to exert maximum pressure on the other side, since the automatic costs consequences are a powerful incentive to settle. Use a Calderbank offer where CPR Part 36 does not apply (for example, in Employment Tribunal proceedings), where the offer involves complex non-monetary terms, or as a supplementary offer alongside a Part 36 offer. If you have any doubt about compliance with CPR r.36.5, take legal advice — a non-compliant Part 36 offer carries no automatic consequences.