Detailed assessment offers
A recent email update from Costs Law Reports covered some of the recent changes to the Civil Procedure Rules. This included the following comment:
“Parties who wish to make offers to settle the costs can no longer do so by making an offer ‘without prejudice save as to the costs of assessment’. On 1 April 2013, CPR 47.19 was revoked and instead the provisions of Part 36 apply, so a paying party who wishes to protect himself against having to pay the costs of assessment must now make an offer under Part 36 (see CPR 47.20).”
If this is meant to represent a statement of the law, it is wrong (even ignoring the transitional provisions concerning cases where detailed assessment proceedings were commenced before 1 April 2013).
The new PD 8.3 to CPR 47.9 states:
“The paying party must state in an open letter accompanying the points of dispute what sum, if any, that party offers to pay in settlement of the total costs claimed. The paying party may also make an offer under Part 36”
Although it remains something of a mystery exactly what purpose the open offer is intended to fulfil, it is difficult to envisage a situation where a paying party “wins” on their open offer but is then not awarded their costs of the detailed assessment proceedings.
Further, in so far as “provisions of Part 36 apply to the costs of detailed assessment proceedings” that also includes CPR 36.1(2):
“Nothing in this Section prevents a party making an offer to settle in whatever way he chooses, but if the offer is not made in accordance with rule 36.2, it will not have the consequences specified in rules 36.10, 36.11 and 36.14.”
The right to make a “Calderbank offer” in costs proceedings (ie one “without prejudice save as to the costs of assessment”) remains.
Further, PD 14.3(d) to CPR 47.15 states that the following must be filed with the court when requesting a provisional assessment:
“the offers made (those marked ‘without prejudice save as to costs’ or made under Part 36 must be contained in a sealed envelope, marked ‘Part 36 or similar offers’, but not indicating which party or parties have made them)”
It is therefore clear that the rules envisage offers other than Part 36 ones being relevant to the costs of assessment; although it is perhaps rather alarming that those who drafted the new rules do not appear to appreciate the distinction between an offer that is “without prejudice save as to the costs of assessment” and one made “without prejudice save as to costs”.