MR v Commissioner of Police for the Metropolis

In assessing costs under Part 36, the financial value of a claim does not necessarily identify the successful party. Vindication and an admission of liability may form a significant part of the remedy sought. An offer to abandon all financial compensation in return for an admission of liability, with costs to be agreed or assessed, may contain a genuine concession and qualify as a Part 36 offer. Where such an offer is not accepted, the court should apply the consequences under CPR 36.17 unless that would be unjust. Criticism of a party’s failure to engage in without prejudice discussions does not necessarily justify departing from those consequences where the discussions could not realistically have resolved the central issue.

The appellant brought a claim arising from his arrest and was awarded damages of £2,750 after the arrest was found unlawful. The trial judge later made no order as to costs, despite finding that the appellant was the successful party. She considered an earlier monetary Part 36 offer, the appellant’s later offer to abandon damages in return for an admission of liability, and the appellant’s failure to respond to an invitation to without prejudice discussions.

The appellant appealed on costs. He argued that his later offer was a genuine Part 36 offer and that the mandatory consequences of CPR 36.17 should apply from expiry of the relevant period. The central issues were whether the offer contained a genuine concession and what costs order should follow.

1. The appeal succeeded in part. The order making no order as to costs remained unchanged for the period before 14 August 2017. For the period from that date, the appellant was entitled to reasonable costs on the indemnity basis and the other benefits provided by CPR 36.17(4), subject to assessment if not agreed.

2. The implications of costs should not overwhelm the issue at the centre of litigation. The appellant’s objective was to clear his name and obtain an admission that the arrest was unlawful. That objective could not realistically be achieved through the respondent’s earlier monetary offer or through pre-trial negotiations. The appellant was therefore vindicated at trial, notwithstanding that the damages awarded were lower than the earlier offer.

3. The appellant’s offer of 20 July 2017, which abandoned any financial remedy in return for an admission of liability and reasonable costs, constituted a significant concession. It was consequently a genuine Part 36 offer and engaged CPR 36.17.

4. The appellant was entitled to the ordinary consequences of CPR 36.17(4) from expiry of the relevant period. The failure to respond to the respondent’s invitation to a without prejudice discussion was a legitimate criticism, but it could not have had a direct effect on the litigation because the respondent was not going to make the admission sought and there was no realistic prospect of settlement on that basis.

5. The trial judge’s assessment of the earlier offers and counter-offers was within her discretion. Her conclusion concerning the costs incurred before the later genuine Part 36 offer was therefore left undisturbed.

• High Court (Queen's Bench Division): Following trial, the appellant recovered damages of £2,750. The trial judge subsequently made no order as to costs.
• High Court (Queen's Bench Division): The respondent’s appeal against the substantive finding was dismissed: [2019] EWHC 888 (QB).
• High Court (Queen's Bench Division): The present appeal on costs was allowed in part. The appellant recovered indemnity costs and the other CPR 36.17(4) benefits from 14 August 2017, while the earlier no-costs order remained.