The importance of the provisions of Part 36 offers has been a prevalent issue in the legal field in general for a long time, particularly given the consequences that can arise from ‘beating’ a compliant Part 36 offer. Most recently issues have been determined by the Courts in relation to the application of the Part 36 provisions to non-monetary claims, the determination of ‘advantageous’ and the importance of ensuring the relevant time period is observed.
In the recent case of Rahman -v- Hassan & Ord (2024), it was determined that the consequences of a Part 36 offer would apply even when the claim was not for a monetary award.
The Claimant had been determined to be the successful party where he had taken beneficial ownership of significant assets of the Deceased. The Claimant’s Part 36 offer had been made in respect of the whole claim and counterclaim and was for the Claimant to receive furniture and some personal chattels of a property, along with some bank accounts. In fact the Claimant was ultimately awarded two properties, the combined value of which would be much higher than the value of the items specified in their own offer.
The Claimant had therefore ‘beaten’ their own offer, however the Defendant argued that CPR 36.17 would not apply because no monetary award had been made to the Claimant – it was the Defendant’s position that the provisions of CPR 36.17(2) restricted the rule to monetary claims only.
HHJ Matthews considered this but noted that ‘more’ or ‘less advantageous’ were terms that do not only apply to money-based claims, but instead should be interpreted in the ordinary sense of the words. The consequences of Part 36, where the Claimant had achieved a ‘more advantageous’ outcome at trial, therefore applied here.
This highlights the key importance and advantage of advancing a Part 36 offer in all types of claims, not limited to those only relating to a monetary value.
The principles of this case are echoed in the case of Grierson -v- Grierson (2024) where the Claimant had again made a Part 36 offer which was not a monetary offer but proposed terms that were more advantageous to the Defendant than the ultimate outcome at trial.
This was a case involving a Will dispute, where the Claimant had made a Part 36 offer which, alongside other things, offered the Defendant an additional pecuniary legacy of £20,000.00. The final Judgment did not provide for such a legacy and therefore had the Defendant accepted the Claimant’s offer, the Claimant would have been financially worse off than he was following the eventual Judgment. In light of this, the Judge noted that the Defendant should have accepted the offer “rather than requiring this matter be taken to trial and his failure to do so has led to substantial costs being incurred”.
The principles of CPR 36.17(4) were therefore applied, leading again to the indication that advancing a protective and reasonable Part 36 offer can stand a party in good stead ahead of a trial or final hearing.
However, it remains an important consideration to ensure a Part 36 offer is compliant and made in a timely manner, allowing the opponent time to properly consider the merits of accepting or rejecting the same.
The recently reported case of Henderson & Jones Ltd -v- Price (2020) considered this in further detail.
In summary, the claim regarded sums due on a director’s loan and the Claimant obtained Judgment at £94,596.10 plus interest following a Trial which started on 14th October 2020. The Claimant had made a Part 36 offer of £40,000.00 on 23rd September 2020, which they accepted could only be deemed as served on 24th September 2020 as it had been sent by email after 7pm. The Claimant clearly ‘beat’ this offer at trial, however the offer was made within 21 days of trial, therefore the usual Part 36 consequences did not automatically apply.
CPR 36.17 (7) provides the Court with the discretion to abridge the acceptance period, however the Judge refused to do so, noting that the Claimant was professionally represented and would therefore be familiar with the requirements relating to service and the relevant period. The Court also noted that the Defendant, who was a litigant in person, was entitled to have the appropriate time to consider the merits of the offer.
The making of a Part 36 offer could be key to establishing ‘victory’ where a more advantageous result has been obtained, whether this involves money-based claims or other matters, but the importance of observing all requirements of CPR 36 does however remain at the forefront of developing case law in the area.