How uncertain is uncertain?

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Posted on: July 14th, 2017 by Brett Anderson

In the case of Briggs V CEF Holdings Ltd (2017) CA (Civ Div), the Court of Appeal were required to consider again the grounds on which it would be “unjust” to apply costs implications of Part 36 under CPR 36.13(5). These cases are notoriously fact sensitive and, in this instance, the Court of Appeal declined to find it unjust to impose the ordinary consequences of Part 36, reversing the first instance decision.

The Claimant had injured his foot in January 2010 in a workplace accident while working for the defendant. He issued proceedings in January 2012, accompanied by an orthopaedic surgeon’s report with an unfavourable prognosis. In September 2012 the defendant made a Part 36 offer to settle the whole claim for £50,000. The 21-day period for accepting the offer expired on 9 October 2012. The Claimant did not accept or reject the offer. In May 2013 he was granted a stay of proceedings and had foot surgery. The stay was lifted in April 2014, after which the Claimant increased his damages claim to £248,000. He then had a new orthopaedic surgeon produce a report in October 2014, which had a slightly better prognosis while remaining unfavourable. However, a subsequent joint experts’ report between that surgeon and one hired by the defendant was far more favourable and considered that the Claimant would be able to work until retirement age. The matter was listed for trial in early 2015, but the Claimant applied to vacate the trial in February 2015 and accepted the September 2012 Part 36 offer on 2 June 2015.

The Claimant cited the case of SG (A Child) v Hewitt (Costs) [2012] EWCA Civ 1053 and successfully argued at first instance that until October 14 the Claimant could not properly consider the offer. The Court of Appeal distinguished SG on the basis that the prognosis in SG was, as a matter of fact, unknown where, in the instance case, there was a prognosis and it a merely a matter of litigation risk as to whether the experts would agree or who the Court would prefer.

My underlying reading is that there were issues with the Claimant possibly exaggerating their claim and pursuing a claim which did not enjoy reasonable prospects of achieving a level significantly beyond that of the accepted offer at any stage in the litigation. Therefore, this was not a matter of great uncertainty but of being over optimistic.

The case serves as a warning to Claimants in receipt of a Part 36 offer. It reiterates that a Part 36 offer will bite unless there is a clear uncertainty as to the prognosis or the facts required to consider the offer and, where a party takes an optimistic rather than realistic approach to their case, they can not rely on the argument that the costs consequences are “unjust”

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