No Cap On Simple Procedure Costs Where Claimant Accepts Tender (Part 36 Offer)

In Graham v Farrell 2017 SC EDIN 7 Sheriff McGowan sets out clear guidance on Simple Procedure costs. Although costs are limited to £300 in Simple Procedure claims; it is often argued that this limit should not apply where matters settle without a trial but after defences are lodged.

In Graham, the Claimant raised an action for payment in January 2017 and written defences were lodged. The action settled when the claimant accepted a tender (part 36 offer) for £3,000 in September 2017. The claimant argued that the limit should not apply because the respondent had lodged a defence and had not proceeded with that.

Sheriff McGowan accepted the claimant's submissions that the limit on costs was subject to the exception in S81(5)(ii) of the Court Reform Scotland Act; that is that the defender "having stated a defence has not proceeded with it". The Sheriff was not persuaded by the respondent's argument that the tender was made on a without prejudice basis and that the