THE NEW PART 36: PART 9: HOW IT REFLECTS AND CHANGES THE EXISTING CASE LAW
This is the 9th in the series on the new Part 36. Here we deal with the relevant case law which may be changed by the new rules.
THE EXPLANATORY TEXT
Rule changes are usually accompanied by helpful explanatory notes. The Explanatory Note accompanying the new Part 36 is of no help at all. It states that the new rule operates by:-
“substituting for Part 36 (offers to settle) a revised Part (together with consequential
changes elsewhere in the CPR) which aligns the rules with case law developed since the
Part was last amended and re-arranges the order of the rules in the Part;”
In fact the new rules go beyond that, they introduce new concepts and, in some cases, amend existing case law.
A SELF-CONTAINED CODE
The new introduction to the rule reflects the principles set out in Gibbon -v- Manchester City Council  EWCA Civ 726.
“36.1.—(1) This Part contains a self-contained procedural code about offers to settle made
pursuant to the procedure set out in this Part (“Part 36 offers”).”
SPLIT TRIALS AND DISCLOSURE OF PART 36 OFFERS
The new rules on unaccepted offers allow a judge, after a split trial, to be told of the existence of a Part 36 offer in relation to issues not covered by the trial but not the details of the offer. See the discussion in the third post in this series.
Amending the existing law?
The existing case law was different
1. In Beasley -v- Alexander  EWHC 2715 (QB) Sir Raymond Jack held that a judge could not be told of the existence of a Part 36 after a trial on liability “until the case has been decided” meant that the whole action had to be concluded.
This new rule has, therefore, changed the pre-existing situation.
“GENUINE” OFFERS TO SETTLE?
The introduction of a new rule which, expressly, states that when considering whether it is unjust to apply the Part 36 consequences the court should also consider “whether the offer was a genuine offer to settle proceedings” most probably introduces nothing new into the law. This principle was made clear in Huck -v- Robson  EWCA Civ 398 and is considered at length in the fifth post in this series.
THE WITHDRAWAL OF OFFERS DURING THE “RELEVANT PERIOD”
The new rules make express provision for the withdrawal of a Part 36 offer.
36.9 deals with withdrawing offers generally.
36.10 allows an offeror to apply to court to withdraw the offer within the initial “relevant period”
“(3) On an application under paragraph (2)(b), the court may give permission for the
original offer to be withdrawn or its terms changed if satisfied that there has been a change
of circumstances since the making of the original offer and that it is in the interests of
justice to give permission.”
So the applicant has to show:
- A change in circumstances.
- That it is in the interests of justice to give permission.
This is to deal with the Evans -v- Royal Wolverhampton Hospitals NHS Foundation Trust  EWHC 3185 (QB) situation.
The previous rule was silent on the criteria to be applied when a party made an application in these circumstances.(However it does not allow a party to make an ex-parte application and seek to withhold the evidence from the opposing party as happened in Evans).
THE “21 DAYS” RULE
The question of whether an offer complied when it said an offer was open for with Part 36 exercised the Court of Appeal in C -v- D  EWCA Civ 646. The new rules deal, expressly, with the circumstances in which an offer can be withdrawn.
- C -v- D makes it clear that a Part 36 offer remains open for acceptance until withdrawn.
- Gibbon makes it clear that there is no concept of an “implied withdrawal” in Part 36. Withdrawal must be express.
THE “MITCHELL” PROBLEM: COSTS AFTER COSTS BUDGET ASSESSED AT NIL
The rules allow a party whose costs budget is assessed at nil to recover 50% of their costs if their Part 36 offer is not beaten. See the discussion in the fourth post in this series.
NEW PART 36 OFFERS NEEDED FOR APPEALS
The new rules state, expressly, that a new Part 36 offer is needed for an appeal. This reflects previous case law, East West Corporation -v- P O Nedlloyd BV