Kerry Underwood

ACCEPTING PART 36 OFFER DURING TRIAL

with 2 comments


In Houghton v PB Donoghue (Haulage & Plant Hire Ltd) and others [2017] EWHC 1738 (Ch) (13 June 2017)

the High Court refused the Claimant permission to accept a Defendant’s offer two days after the trial began, in circumstances where the Part 36 offer had been made nearly six months earlier.

The judge recognised that allowing acceptance of the offer would settle the matter and save the court’s time but against that was the fact that the attempt to accept had been left very late and that the Defendant now wished to take its chances at trial, meaning that for all intents and purposes the settlement would be court imposed rather than voluntary.

The court said that where a claimant decided to take its chances at trial, and then changed its mind because the trial was going less well than predicted, then the court would often conclude that it was not right to allow acceptance.

The court considered two Technology and Construction Court authorities relating to earlier version of Part 36

Sampla and others v Rushmoor Borough Council and another [2008] EWHC 2616 (TCC); and

Nulty v Milton Keynes BC [2012] EWHC 730 (QB).

Comment

I have no problem with this decision, but the Defendant who wishes to take its chances at trial could withdraw the offer and thus remove any risk of the court allowing acceptance of the Part 36 offer, as there will be nothing to accept.

True it is that the Defendant would not automatically get the benefits of Part 36 if the Claimant failed to beat its offer.

This throws up one of the many problems with Part 36.

Supposing in this case the claimant says   “Okay – we are part way through the trial – we wish to accept the offer of £100,000.00.”

The judge refuses. He will not know the value of the offer. He then goes on to award more than £100,000.00. Arguably, there is no problem as the Defendant will then have to pay all of the costs of trial.

But supposing the judge awards £98,000.00 and there had been a further £75,000.00 of costs occasioned by the judge’s refusal to allow the Claimant to accept the Defendant’s Part 36 offer of £100,000.00, which has never been withdrawn.

Why should the claimant be forced to pay all of those costs?

Why is it not reasonable of a claimant, realising the way the matter is going, to seek to end further costs by accepting the offer?

How is this different, in principle, from the court’s general refusal to punish discontinuing QOCS Claimants on the basis that it is better to discontinue than to go to trial and lose?

The policy of the judiciary needs to be thought through in relation to these matters, which I accept involve conflicting public policy principles.

As in most things in life and law, certainty either way has a great deal to be said for it.

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Written by kerryunderwood

July 21, 2017 at 11:14 am

Posted in Uncategorized

2 Responses

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  1. Do we know what the outcome of the actual trial was?

    Pro Bono

    July 21, 2017 at 1:02 pm


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