What happens if a Part 36 offer is rejected?
If one party does not accept a Part 36 offer, then the claim may go to court.
The party who rejected what the Court deems to be a ‘reasonable offer’ as they did not obtain a better outcome than the Part 36 Offer will typically be ordered to pay an additional liability, which can include:
- Payment of additional compensation by way of uplift on the amount awarded.
- Interest on the compensation award.
- Additional costs.
If a claimant rejects a ‘reasonable offer’, the Court will often determine they have acted unreasonably, resulting in greater legal costs incurred whereby they should be liable for the additional legal costs.
If a defendant rejects an offer made by the Claimant, they may have to pay additional compensation to the Claimant plus legal costs.
How do you make a Part 36 offer?
A Part 36 offer can be made at any time before the Court makes a judgment. However, once a trial has commenced, the Court’s permission will need to be sought before a Part 36 offer can be accepted.
If you make a Part 36 offer as a claimant, it is important to ensure it is the right offer. An offer should only be made after all evidence to support your claim has been thoroughly analysed and assessed. It may not be in your interests to make an offer if the potential amount of compensation cannot be assessed, upon which our solicitors can advise you.
To be valid, an offer under Part 36 must be:
- Made in writing.
- Clearly specify that it is made under Part 36.
- State whether the offer is for whole or part of the claim.
- Specify a period of 21 days or more within which the offer can be accepted (this is called the ‘relevant period’). If an offer is accepted after the relevant period, then the party who accepted the offer may be liable for the costs incurred by the other party between the end of the relevant period to the date of acceptance.
The party who made the Part 36 offer may require permission to change or withdraw an offer during the ‘relevant period’.
Once an offer is accepted, the Defendant has 14 days from the date of acceptance to pay the Claimant the settlement sum agreed in full.
