In JLE v Warrington & Halton Hospitals NHS Foundation Trust [2018] EWCA Civ 2849, in the context of detailed assessment proceedings, the claimant presented a bill for £615,751 and then made a Part 36 offer to accept £425,000. At the detailed assessment, the court assessed the bill at £431,813, the claimant thereby beating its offer by approximately £7,000. In approaching the question of the cost consequences that follow an unaccepted claimant Part 36 offer – which the court must apply unless it considers it unjust to do so – the court held (1) those consequences are severable and (2) it would be unjust to award the additional amount specified in CPR 36.17(4)(d) given the small margin of success by the claimant.

On appeal, the court agreed that the costs consequences in CPR 36.17(4) are severable: it is open to the court to find that some consequences are unjust to award, while others are just. However, the court disagreed that it would be unjust in this case to award the claimant the additional amount in CPR 36.17(4)(d): it was not open to judges to take into account the amount by which a Part 36 offer was beaten.   

Points of note that arise from this judgment:

·        However small the margin by which a claimant’s offer is beaten is irrelevant. The court had regard to sub-rule CPR 36.17(1)(b) which emphasises that better in money terms means better by any amount, however small, and “at least as advantageous” should be construed accordingly.

·        For a judge to take this into account would risk reintroducing the Court of Appeal’s decision in Carver v BAA plc [2008] EWCA Civ 412. There the claimant beat the defendant’s Part 36 offer by £51 and the Court of Appeal upheld the trial judge’s finding that it could not be said that the final outcome was more advantageous than accepting the defendant’s offer. This ruling was subsequently reversed by the Civil Procedure Rules Committee on the recommendation of Jackson LJ.

·        The additional amount is not a “bonus” (as it had been characterised by the master); there is a penal element attached to it. It is also “all or nothing”; the wording of the rule is expressly prescriptive.

·        The claimant had had to seek permission to appeal out of time. This was because the court office had refused to accept the appellant’s notice in the absence of a sealed order (enquiries had been made of the master whereby it had been confirmed that the order had not been sealed). A sealed order was received 15 days’ later and the appellant’s notice was filed the next working day. The appeal court had “no hesitation” in granting permission in the circumstances, nor did the defendant oppose the extension of time.