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ARTICLE · 02 FEBRUARY 2015

Changes To UK Tactical Settlement Offer Rules

Following criticism in the past few years and some inconsistent judgments, Part 36 has been amended with changes to come into effect on 6 April 2015.

United KingdomLitigation, Mediation & Arbitration

A Part 36 offer provides parties with one of the most important tactical steps in litigation in the UK courts, attaching important cost implications should a settlement not be achieved.

Following criticism in the past few years and some inconsistent judgments, Part 36  has been amended with changes to come into effect on 6 April 2015.  These changes address the following:

  • Whether time-limited offers are valid Part 36 offers – new CPR 36.9(4)(b) allows a Part 36 offer to be automatically withdrawn after expiry of the relevant period in accordance with its terms
  • Improved offers - new CPR 36.9(5) provides that an amended offer to make terms more advantageous to the offeree is treated as a new offer rather than a withdrawal of the original offer
  • Part 36 offers in the context of appeal proceedings – new CPR 36.4 makes specific provision for appeal proceedings
  • Difficulties in dealing with split trials or trials of preliminary issues – new CPR 36.16 addresses this and permits the trial judge to be told of the existence of any offer but not the terms
  • Clarifying Part 36 in relation to counterclaiming defendants – new CPR 36.2(3) confirms that a Part 36 offer may be made in respect of a counterclaim or other additional claim

This is a comprehensive overhaul of Part 36 and in addition to the key changes outlined above the amendments go some way to codifying recent case law in this area to provide a "self-contained procedural code about offers to settle made pursuant to the procedure set out in [Part 36]" as stated in new CPR 36.1.

See the amendments in full here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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