Part 36 uplift is “all or nothing”, rule committee confirms

Stewart: Part 36 decision backed by committee

The 10% uplift on costs for beating a part 36 offer is ‘all or nothing’ and judges cannot award less, the Civil Procedure Rule Committee (CPRC) has confirmed.

At its meeting in November, the committee left in place Mr Justice Stewart’s ruling last year in JLE v Warrington [2019] EWHC 1582 (QB).

The issue was brought to the attention of the CPRC’s lacuna sub-committee after Stewart J effectively overruled the decision of Deputy Master Friston – author of Friston on Costs – in White v Wincott [2019] EWHC B6 (Costs), in which he held that the court has power to award less than the specified 10% uplift on the sum awarded, but said it was a difficult question.

The minutes of the November meeting, released just before Christmas, noted: “The ‘all or nothing’ approach lacks flexibility but may be more consistent with the underlying policy of part 36… It was recommended that the CPRC leaves the decision in JLE in place and this was agreed.”

The CPRC will liaise with the White Book and Green Book editors to incorporate relevant commentary on this.

In JLE, Stewart J – speaking obiter – noted that rule 36.17(4)(d) was “expressly prescriptive”, scaled down the uplift in higher-value cases and did not incorporate any ‘good reasons’ type of exception.

“One can see a very good policy reason for the present rule, as I interpret it, namely to discourage further satellite litigation on the appropriate extent of the additional award,” he said. “Further, there would be no points of orientation as to what would be a proper amount of reduction.”

The lacuna sub-committee also highlighted the question of rule 52.22 and the disclosure of part 36 offers on appeal. It was raised by Mr Justice Birss, following his decision in Ubbi v Ubbi 2019 EWHC 2333.

Rule 52.22 provides for non-disclosure of part 36 offers on appeal (and on applications for permission to appeal), whether made on appeal or in the court below, “until all questions (other than costs) have been determined”. An exception is if they are relevant to the substance of the appeal.

However, the CPRC heard that where both a merits and costs ruling are appealed, this is often done in a single notice of appeal with a single set of grounds. A single appeal bundle is prepared that includes the part 36 material. The CPR are silent on this situation.

The CPRC decided to amend rule 52.22(1) to add “unless the appeal court otherwise orders”. This will come into effect in the next update in April.

Further, Birss J and John Dagnall – a barrister member of the CPRC – would liaise regarding whether to make any recommendations “regarding the more general issues of both theory and practicality as to the revealing or not revealing of offers made in proceedings in the court below the appellate court”.

Separately, the CPRC has indicated that it accepts in principle the case made by the Bar Council and Personal Injuries Bar Association for a review of fixed advocacy fees on the fast-track in personal injury claims worth up to £25,000. They are now more than a decade old.

The minutes said: “The Chair [Lord Justice Coulson] agreed in principle and said that he anticipated a CPRC sub-committee would likely need to be formed in the future, but given that the [Ministry of Justice is] in the process of considering the responses to the consultation Extending Fixed Recoverable Costs in Civil Cases: Implementing Sir Rupert Jackson’s proposals, the expectation is that the CPRC will not become involved until there is a much clearer indication of timing from the MoJ, who will need to set out a way forward in response to that consultation in due course.”

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