Serving a Part 36 offer
What is service?
In court proceedings, relevant documents have to be filed at court and served to the other party. Section 6 of the Civil Procedure Rules (CPR) governs the rules on service. There are different rules depending on whether the document is a claim form and if it is within the jurisdiction or not.
CPR also sets out what methods of service can be used and the time for calculation of ‘deemed’ service. Methods of service include:
There is much litigation around issues of service, which are extremely pertinent when you are up against a deadline or limitation.
What is a Part 36 offer?
Within proceedings, parties are encouraged to try and settle claims without recourse to a final hearing. To encourage this, there are provisions in CPR 36 that give a party costs protection. This is where an offer is made to settle the whole or part of a claim/counterclaim.
There are very stringent criteria to comply with under CPR 36 before the costs protection applies. This area is a minefield for the unwary, as demonstrated by the amount of litigated cases reported on this subject.
How does service apply to a Part 36 offer?
It is clear in CPR 36 that offers, acceptances and withdrawals of CPR 36 have to comply with the general rules on service contained in CPR 6.
- CPR 36.11 (a) confirms that a Part 36 offer is accepted by serving written notice of acceptance on the offeror.
- CPR 36.9 (2) confirms that the offeror withdraws the offer by serving written notice of the withdrawal on the offeree.
- Practice Direction 6A para 4.1(1) confirms that service by e-mail is only effective if the other party has indicated in writing that it is willing to accept service by e-mail.
- CPR 3.10 allows a court to rectify an error of procedure such as a failure to comply with a rule or practice direction.
Part 36 offer example cases
Some cases have highlighted the issue with the interplay of Part 36 offers and service.
Sutton Jigsaw Transport Limited v Croydon London Borough Council
An important Part 36 offer example is the case of Sutton Jigsaw Transport Limited v Croydon London Borough Council (2013).
After the trial had commenced, the claimant sought to accept a Part 36 offer by a handwritten note. Two minutes later, the Defendant withdrew the offer by fax. It was held that the withdrawal was invalid, as personal service under CPR 6 is not permitted if a party has already given an address for service.
The judge held:
“…it does seem to me, on analysis, that CPR 36 does provide clear rules and the parties should be on a level playing field; both should be taken to know the rules and should comply with them if they wish to obtain the benefits which CPR 36 provides. To permit the claimant’s application…would, as it seems to me, to give the party, who did not comply with the rules…with an unfair advantage compared with the party that did comply with the rules.”
Thompson v Reeve
The more recent decision in the case of Thompson v Reeve (2017) contrasts with that decision. This followed:
- A withdrawal of a Part 36 offer was made by email on 28th February 2017.
- The Defendant then sought to accept the Part 36 offer on 2nd March 2017 by fax and DX.
- The Claimant accepted that service was invalid but sought to rely on CPR 3.10 to rectify that defect.
The argument was whether CPR 3.10 could be applied to CPR 36 (a self-contained code). The judge held that CPR 3.10: “has a wide effect and can be applied in the present circumstances” as CPR 36 was “not completely freestanding.”
He clarified that CPR 3.10 clearly could not be used to extend a statutory time limit or avoid service of a document required by statute.
Help and advice with Part 36 offers
It is increasingly common for settlement negotiations to be done by email – the trend for most communications. It is advisable from an early stage to establish with the other party that they are prepared to accept service (not just general communications) by email, to avoid arguments later.
The rules under CPR 6 and 36 are complex. To obtain the full protection afforded under CPR 36, it’s imperative the rules of service under CPR 6 are not overlooked, as the cases above have illustrated the serious consequences that can follow. This could lead clients to look to their legal representatives for redress.
For further help and advice relating to Part 36 offers, find out more about our legal services at Hodge Jones & Allen. Speak to one of our expert legal team today by calling 0808 252 5231 or request a call back.