Lumb v Hampsey

Late acceptance of a Part 36 offer ordinarily attracts the costs consequence prescribed by CPR 36.10(5). The court may depart from that order where it would be unjust in the particular circumstances, but such departure is exceptional. Relevant matters include the offer’s terms, timing, available information, and the parties’ conduct in providing information. A claimant’s protected-party status does not itself prevent the ordinary costs order. Nor will speculative valuation, rehabilitation, changing personal circumstances, or possible Court of Protection approval justify departure where the evidence permitted valuation and the relevant difficulties were not candidly raised.

The claimant suffered a traumatic brain injury in a road accident. Liability was admitted and judgment was entered for him. The defendant made a Part 36 offer of £900,000 in July 2010, clarified in August 2010. The claimant, then a protected party, rejected it and continued preparing for a quantum trial.

After further medical evidence and changes in the claimant’s personal circumstances, he accepted the offer shortly before trial. The parties disagreed about the costs consequences. The claimant sought permission to accept the offer under CPR 36.9(3)(b), referring to further deductible benefits, and argued that it would be unjust to make him pay the defendant’s costs after expiry of the relevant period.

1. Costs consequence. The claimant’s acceptance after expiry of the relevant period engaged CPR 36.10(5). The usual order was that he should pay the defendant’s costs from expiry of the relevant period to acceptance.
2. Applicable test. The court should depart from that order only where it would be unjust in the particular circumstances. Departure is exceptional. The approach is similar to that under CPR 36.14. Relevant factors include the offer’s terms, the stage when it was made, the information available, and the parties’ conduct concerning information needed to make or evaluate the offer.
3. Application. The medical and care evidence available when the offer was made gave the claimant’s representatives sufficient material to value the claim. Their own quantum summaries and later Part 36 offer demonstrated that they could do so. The claimant’s rehabilitation, protected-party status, anticipated marriage breakdown, and possible Court of Protection approval did not establish sufficient grounds for departure. No approval application had been made, and the claimant’s advisers had not candidly raised these matters with the defendant or sought an extension.
4. The claimant was entitled to reject the offer and seek a higher one, but the resulting litigation risk remained his. Accepting shortly before trial caused further costs to accrue. A new relationship did not reliably establish that commercial care would no longer be required.
5. The usual order was made under CPR 36.10(5). The judgment records, but does not separately determine, the application under CPR 36.9(3)(b).