Pre-Issue Part 36 Offers
The recent confusion caused by the decision in Udogaranya v
Nwagw [2010] EWHC 90186 (Costs) regarding the costs consequences of accepting a
pre-issue Part 36 Offer appears to have been resolved by the recent case of
Thompson & Thompson v Bruce [2011]QBD (28.06.11). In this case Deputy High
Court Judge John Leighton Williams QC found that ‘proceedings’ in CPR r.36.10
should be given a wider meaning to include that which took place prior to the
commencement of proceedings.
He said that the intention of CPR r.36 was to create a more practical approach to the settlement of claims with CPR r.36.3(2)(a) permitting
Part 36 Offers to be made before proceedings were issued. If there was no
entitlement to costs pre-issue this would effectively frustrate the purpose of
CPR r.36 and would encourage parties to issue proceedings just to protect their
position on costs, thereby contradicting the overall intention of the rules which
was to promote early pre-issue settlement.
It is hoped that this decision will deter Defendants from
seeking to avoid their costs liabilities by relying on a technical and clearly
flawed argument in relation to the interpretation of CPR r.36.
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