Robert Gagliardi v Evolution Capital Management LLC

For the purposes of CPR Part 36, the start of a trial is ordinarily the first day on which the parties are required to attend court and the trial actually begins. Judicial pre-reading days do not alter that date, even where a court guide treats them as the start of trial for case-management deadlines. The interpretation of Part 36 should promote certainty because it operates as a self-contained code.

Where a compliant offer beats the judgment, the recipient bears a formidable burden of showing that the prescribed consequences would be unjust. Late procedural activity does not, without more, discharge that burden. Indemnity costs require litigation conduct outside the norm; hard-fought commercial litigation alone is insufficient.

The claimant had obtained judgment for approximately $5.38 million in the underlying commercial proceedings. He had made a Part 36 offer of $3 million on 12 September 2025, less than 21 days before judicial pre-reading but more than 21 days before the first day on which the parties attended court for the trial.

The defendant argued that judicial pre-reading marked the start of trial under CPR 36.17(7)(c), and alternatively that it would be unjust to impose the consequences of CPR 36.17(4). The claimant sought those consequences, indemnity costs, enhanced interest and permission to appeal was sought by the defendant. The court also considered whether the defendant’s litigation conduct justified indemnity costs.

1. Part 36 timing. The offer was not made less than 21 days before trial. The natural and objective meaning of “the start of trial” in CPR 36.17(7)(c) was 6 October 2025, the first day on which the parties and their lawyers were required to attend court. Judicial reading days could change, could occur during the sitting period, and did not provide a sufficiently certain basis for calculating Part 36 consequences. The Commercial Court Guide addressed practical case-management deadlines and could not alter the meaning of CPR Part 36.
2. Unjustness. Under CPR 36.17(5), the defendant bore a formidable burden of establishing injustice. The late stage of the offer, unfinished pleadings and witness evidence, and continuing trial preparation did not satisfy that burden. Earlier settlement offers, the defendant’s ability to assess the principal contractual construction issues, and the settlement-promoting purpose of Part 36 supported enforcement of the rule. The consequences under CPR 36.17(4) were therefore ordered.
3. Costs. The litigation was hard-fought but did not fall outside the norm. Standard-basis costs were appropriate generally. Indemnity costs were ordered for the discrete counterclaim allegations that the claimant’s conduct gave an impression of disreputable behaviour justifying immediate dismissal and loss of remuneration; those allegations had been effectively abusive.
4. Appeal and interest. Permission to appeal was refused on all four proposed grounds, which involved construction or findings already addressed by the court. Enhanced interest at 10 per cent above base rate was awarded under CPR 36.17(4), having regard to the settlement objective, the earlier offers, the relatively short period of enhancement and the defendant’s decision to reject a timely offer.

First-instance decision. The judgment records no prior appellate decision in this litigation.