The costs subcommittee of the Civil Procedure Rule Committee (CPRC) is apparently due to consider whether it should be possible to make Part 36 offers in relation to the costs of detailed assessment.
This follows the recent decision of Master Leonard in Best v Luton & Dunstable Hospital NHS Foundation Trust [2021] EWHC B2 (Costs) whereby he concluded a Part 36 offer could not be made in respect of the costs of the detailed assessment proceedings (although Part 36 offers can clearly be made in respect of the costs claimed in the Bill).
It will be a missed opportunity if the CPRC considers this narrow issue alone.
Part 36 offers in detailed assessment proceedings create a unique imbalance between receiving parties and paying parties.
Normally, the Part 36 benefits to claimants will only crystalise if a claimant wins on a Part 36 offer at trial. In relation to substantive matters, there is the process of disclosure. By the time a matter reaches trial, and usually long before then, both parties will have received disclosure of all relevant evidence and documents from the other side and will therefore be on a broadly equal footing in terms of considering the reasonableness of any Part 36 offers. The Part 36 sanctions therefore bite when a defendant has failed to accept a reasonable offer in circumstances where they were in a fair position to judge the reasonableness of that offer.
In detailed assessment proceedings, the receiving party is treated as the claimant for the purposes of Part 36. However, unlike in substantive proceedings, there is no disclosure process to the paying party of any kind during detailed assessment proceedings.
A paying party is required, for example, to consider the reasonableness of the number of communications and attendances on the claimant without sight of any of those communications or attendance notes. A paying party is required to consider the reasonableness and quantum of advices from, and conferences with, counsel, often with no information from the Bill or fee notes as to what they related to, much less copies of the advices or attendance notes themselves. And on it goes.
Paying parties are at a material disadvantage to the usual position that arises when Part 36 offers are made.
Rather than focus on the narrow issue of whether the scope of Part 36 should be extended in detailed assessment proceedings, surely the question is whether the continued existence of Part 36 offers can be justified in the absence of disclosure.
