Part 36 gets a makeover

The new look Part 36, due to come into force on 6 April, addresses some of the most pressing problems encountered in practice, a QC has said.

Ed Pepperall QC, a commercial silk at St Philips Chambers and a member of the Civil Procedure Rule Committee (CPRC) which drew up the new Part 36, provides “an insider’s guide” to the new rules, in NLJ this week.

Part 36 is used in virtually every case, from modest-value fast-track claims to billion-pound litigation, he writes, and it is important “that its sophisticated system of carrots and sticks is fit for purpose”.

The new rules offer greater clarity on split trials and the extent to which a judge may be told about an offer. Litigators will be able to make time-limited offers, and offers are less likely to be discounted for technical reasons.

Another change is that notice to make an offer more advantageous will be treated as the making of a new offer on the improved terms rather than the withdrawal of the original offer.

The new Part 36 even takes account of the notorious Mitchell case—a new rule provides that litigants whose budget has been limited to court fees can nevertheless recover 50% of their costs assessed without reference to the limitation if they make an effective Part 36 offer.

Pepperall writes: “This solution is intended to ensure that the miscreant is still punished for the default that led to the sanction while the innocent party does not have a blank cheque to turn down reasonable settlement offers.”