Henderson & Jones Limited v Salica Investments Limited & Ors

The appropriate rate of interest on damages is determined broadly by reference to the general characteristics of the claimant, rather than its actual borrowing rate. For a claim assigned by an individual, the court may assess interest by reference to the realistic cost of unsecured borrowing by a private individual.

A Part 36 offer may remain valid despite an ambiguity or omission if, read objectively against the relevant correspondence and background, a reasonable solicitor would understand it as complying with Part 36. The court should prefer a construction that gives effect to an intended Part 36 offer where reasonably possible.

Following an eight-day trial, judgment had been entered for the claimant, a litigation funder and assignee, against the first and fourth defendants for breach of confidence, with negotiating damages of £2,154,285.

The consequential hearing concerned interest on the judgment sum, the validity and effect of the claimant’s Part 36 offer, indemnity costs, interest on costs, an additional payment, payment on account of costs and permission to appeal. The central issues were whether the offer’s reference to an undefined capitalised “Relevant Period” could be understood as referring to 21 days, and what financial and costs consequences followed.

1. The court awarded interest on the judgment sum at 5% above the Bank of England base rate from 9 March 2016 to 21 November 2023. The assessment was broad-brush and reflected the realistic borrowing cost for a private individual in the position of the original claimant. The court rejected the defendants’ proposed Commercial Court rate of 1% above base as unrealistic. It also declined to disapply interest for delay, because the claimant became aware of the breach in early 2018, the defendants’ conduct made the claim harder to establish and settlement efforts continued.

2. The claimant’s Part 36 offer dated 31 October 2023 was valid. Although the letter did not define “Relevant Period”, earlier Part 36 offers between the parties had defined that term as 21 days. Read objectively in that context, a reasonable solicitor would understand the reference to mean 21 days. The court applied the principle that an intended Part 36 offer should be validated where reasonably possible, while recognising the importance of compliance with the rules.

3. The offer was beaten. Under Civil Procedure Rules 1998, CPR r. 36.17(4), the defendants were therefore ordered to pay interest on the judgment sum at 10% above base rate from 21 November 2023, indemnity costs for the action, interest on incurred costs at 5% above base rate up to that date and 10% thereafter, and an additional £75,000.

4. The defendants were ordered to pay £927,310.55 on account of costs. Permission to appeal was refused. The costs of the consequential hearing were payable by the defendants on the standard basis, subject to assessment.

Not an appeal. The judgment determined consequential matters following the court’s earlier judgment after trial.