# Part 36 offers: costs consequences of formal settlement offers

> **Key takeaway:** Valid Part 36 form (r.36.5) → relevant period → acceptance or judgment comparison → automatic costs consequences (rr.36.13–36.17), displaceable only if unjust. Self-contained code (Gibbon). Not the same as Calderbank.

- **Jurisdiction:** England & Wales
- **Practice area:** Civil Procedure
- **Last reviewed:** 2026-08-04
- **Interactive page:** https://kttclegal.info/library/notes/CivilProcedure/part-36-offers-overview
- **Keywords:** Part 36, CPR 36, settlement offer, costs consequences, more advantageous, Gibbon, claimant offer, defendant offer, civil procedure

## What is this about?

CPR Part 36 provides a self-contained regime for formal settlement offers with prescribed costs consequences if the offer is not accepted and the case proceeds to judgment. Correct formal validity, timing, and comparison of the judgment with the offer are essential — informal 'without prejudice save as to costs' offers remain useful but do not attract Part 36's automatic consequences.

## What is the core rule?

A valid Part 36 offer, made in accordance with the formal requirements of CPR 36, creates a costs framework: if the offeree accepts within the relevant period, costs usually follow the Part 36 acceptance rules; if the offeree rejects (or fails to accept) and then fails to obtain a more advantageous judgment, prescribed adverse costs and related consequences under Part 36 apply (including, where the offeror is a claimant who beats their own offer, enhanced interest and an additional amount in defined cases). The court retains limited residual discretion but Part 36 is intended to be a largely automatic code.

## What are the elements or test?

1. Is the offer a Part 36 offer in form (CPR 36.5 requirements: clear Part 36 statement, terms, relevant period, etc.)?
2. Who is the offeror (claimant or defendant) and what is the relevant period?
3. Was the offer accepted within the relevant period, after expiry, or never accepted?
4. At judgment: compare the outcome with the offer — has the claimant obtained a judgment more advantageous than a defendant's offer, or equalled/beaten their own claimant offer?
5. Apply the corresponding costs consequences (and any additional amount / enhanced interest where engaged); check exceptions and the court's limited power to order otherwise if unjust

## Which authorities matter?

- **Civil Procedure Rules, Part 36 (especially rr.36.5, 36.13–36.17)** — Primary code: form of offer, acceptance, and costs consequences following judgment.
- **Gibbon v Manchester City Council [2010] EWCA Civ 726, [2010] 1 WLR 2081** — Court of Appeal emphasises Part 36 as a self-contained code; ordinary contract offer-and-acceptance analogies are unsafe.
- **Carver v BAA plc [2008] EWCA Civ 412 (historical) / later rule reforms on 'more advantageous'** — Illustrates the importance of the current wording of the 'more advantageous' comparison — always apply the rule text in force, not outdated glosses.

## How does this apply in practice?

Part 36 is amended periodically; always check the current White Book/CPR text for form requirements, the additional amount percentage, and interest provisions. This note does not cover QOCS interaction in detail, fixed recoverable costs schemes, or detailed assessment procedure. Non-Part 36 Calderbank offers remain relevant where Part 36 is unsuitable.

## What are common pitfalls?

- Assuming any without-prejudice offer attracts Part 36 consequences
- Defects in form (missing required statements) that prevent Part 36 status
- Mis-comparing judgment and offer (interest, costs, non-monetary terms)
- Treating Part 36 like ordinary contract revocation/acceptance without reading the Part 36 code

## When would a practitioner use this?

Use when advising on settlement strategy, drafting offers, or preparing costs argument after trial or disposal.

## Quick reference

Valid Part 36 form (r.36.5) → relevant period → acceptance or judgment comparison → automatic costs consequences (rr.36.13–36.17), displaceable only if unjust. Self-contained code (Gibbon). Not the same as Calderbank.

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*Reference material from [KTTC Legal](https://kttclegal.info/), not legal advice. Work product supports instructing solicitors and barristers under their supervision. England & Wales.*