High Court: reasons for withdrawal of part 36 offers must be disclosed


Royal Courts of Justice

Defendant could not conceal the way things had changed

Judges who give permission for the withdrawal of part 36 offers must disclose the arguments and evidence behind their decisions, the High Court has ruled.

Mr Justice Leggatt said that, in a “remarkable” personal injury case, a judge granted an order permitting the defendant NHS trust to withdraw a part 36 offer without the claimant being served with any evidence or any record of what was said at the hearing.

“Even now, the claimant and her representatives do not know the basis on which the ex parte order was made,” Leggatt J said.

“The only information provided to them has been a redacted version of the defendant’s skeleton argument for the hearing on 7 August 2014. This contains a submission that there was a change of circumstances which justified permitting the defendant to withdraw its offer.

“However, in the copy disclosed to the claimant, the parts of the skeleton argument which presumably explained the nature of this alleged change of circumstances have been blanked out.”

The court heard in Evans v Royal Wolverhampton Hospitals NHS Foundation Trust [2014] EWHC 3185 (QB) that the claimant responded by issuing an application to have the ex parte order set aside and for evidence in support to be served on the claimant.

Jayne Evans fell in the street while intoxicated and was discharged from hospital later in the day. The following day she was readmitted, but despite treatment, suffered a brain injury.

On July 3 this year, the defendant made an offer of £325,000 under part 36. Before the 21-day period for acceptance had expired, it served a notice of withdrawal. On the same day, the claimants served a notice accepting the offer.

Unknown to the claimant, on July 24 the defendant issued an application for permission to withdraw the offer, which was granted by Judge McKenna, sitting at the Birmingham District Registry of the High Court, at a hearing the following month.

The claimant complained that the procedure followed was contrary to natural justice and unlawful.

Setting aside Judge McKenna’s ex parte order, Leggatt J said: “It cannot be open to a party who did not have good reason to withdraw its offer at the time when it gave notice of withdrawal during the 21-day period and who would have been refused permission by the court on that date to justify the withdrawal by reference to matters discovered subsequently.

“This being so, I find it difficult to envisage what legitimate reason there possibly be for seeking to conceal from the offeree the way in which circumstances are said to have changed after the offer was made and before the notice of withdrawal was given.”

Mr Justice Leggatt ruled that unless the defendant served the evidence and disclosed the arguments on which it wished to rely, the claimant was entitled to judgment under part 36.

 

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