When has a Claimant beaten its own offer?

31st July, 2016

Where a Claimant makes a Part 36 offer to accept ‘x’ inclusive of interest and proceeds to trial where he recovers ‘y’ inclusive of interest, where ‘y’ is greater than ‘x’, he’s beaten his offer hasn’t he? Not, necessarily.

In Purrunsing v A’Court & Co [2016] EWHC 1528 it was held that whether a judgment sum was more advantageous in money terms than a Claimant’s Part 36 offer, it was necessary to eliminate from the comparison the interest that had accrued on the award after the Part 36 acceptance period had expired.

Otherwise, whether or not the consequences of Part 36 applied, primarily the 10% uplift on damages, would partly depend upon the date the trial took place and judgment handed down which would be arbitrary. In Purrunsing, after deducting interest accruing after expiry of the relevant period gave a figure less than ‘x’ and therefore judgment was not “as least as advantageous”.

A Part 36 offer is deemed to be inclusive of interest. A party can provide some certainty by stating expressly how much of the offer represents interest or, alternatively, a Part 36 offer can be silent as to interest in which case various scenarios could play out. For instance, the parties may have vastly differing views on the level of interest recoverable, if any, and when it ought to run from (see Involnert Management Inc v Aprilgrange Limited & Ors). In those circumstances, determining whether an offer has been beaten or not may become a difficult prospect.

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