Part 36 offer not a “trump card” to thwart court orders

Calendar: Part 36 offer accepted 11 days after unless order deadline

A part 36 offer is not “some form of trump card” which overrides previous court orders, a High Court judge has made clear.

In a case where a claim had been struck out after an unless order had been breached, it was not for a judge to grant relief so a part 36 offer could be accepted, “thwarting the purpose and effect” of the order, said Mrs Justice Falk, approving the words of the judge at first instance.

Falk J said the request for the strike-out was made “against the background of continued delays in providing documents requested, including earlier failures to comply with orders for disclosure”.

She went on: “The breaches of the orders were serious, and it was wrong to test this, as counsel for the appellants sought to do, simply in the context of the part 36 settlement offer and purported acceptance.

“It was also wrong to conclude that because the unless order required early disclosure with a view to seeking to narrow the issues and hopefully to allow settlement to occur, that that somehow made the failure to comply less serious than a failure to make standard disclosure.”

Falk J was ruling in a negligence claim against London law firm Hugh Cartwright & Amin (HCA) brought by David and Anjana Devoy-Williams.

Falk J said the “immediate starting point” for the hearing was an unless order granted in favour of the law firm in September 2016, providing that the claim would be struck out if certain documents were not provided by 21 October 2016.

On 10 October, HCA’s insurers made a part 36 offer, which the claimants sought to accept on 1 November. HCA argued that this was of no effect because the claim was already struck out as at 21 October.

On 21 November, Her Honour Judge Baucher in Central London County Court formally ordered that the claim be struck out.

Delivering judgment in Devoy-Williams v Hugh Cartwright & Amin [2018] EWHC 2815 (Ch), Falk J said she did not agree with the claimants that the fact that a part 36 offer was made after the unless order was an indication that compliance was not material.

“Disclosure would have remained material if the claim had not settled, and the fact that the order for disclosure may have been motivated by the aim of facilitating settlement does not affect the question of whether there had been a material failure to comply.”

Falk J said: “I do not agree with counsel for the appellants’ submission that the judge was not entitled to have regard to the fact that relief from sanctions was applied for late.

“The appellants were aware by early November 2016 that the respondent’s position was that there had been breaches of the unless order.”

She went on: “Whilst it is certainly right that an unless order should not be made simply for good housekeeping purposes, and it is usual for there to have been a breach of a prior order before an unless order is made, the judge clearly took account of the history of the proceedings, with which she was extremely familiar, and specifically the appellants’ conduct in them.”

Falk J said the order was made in the light of previous delays and problems in disclosure. She said HHJ Baucher was entitled to conclude that the three-stage test in Denton did not lead to a conclusion that relief should be given.

She added that she disagreed that the claimants should be treated as “unsophisticated” litigants-in-person.

“They clearly were not unsophisticated and indeed, although they were acting as litigants-in-person through much of the process, they in fact benefited from professional advice at a number of stages.”

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