Most civil disputes settle without a final trial, even where court proceedings have already started. Effective litigation therefore involves much more than preparing legal arguments and presenting a case in court. Negotiation, timing and tactical judgment are fundamental to achieving a successful outcome.
Part 36 offers are one of the most important tools available to litigation solicitors. They allow both claimants and defendants to propose a settlement, with potentially significant consequences for legal costs if an offer is rejected and the case proceeds to judgment.
A carefully judged Part 36 offer can put your opponent under pressure, protect your position on costs and help achieve a favourable settlement without the expense and uncertainty of trial.
At Taylor Rose, our commercial litigation solicitors consider settlement tactics throughout a dispute. Knowing when to make an offer, how much to offer and whether to accept, reject or counter one is a core part of effective litigation strategy.
What is a Part 36 offer?
A Part 36 offer is a formal settlement offer made under Part 36 of the Civil Procedure Rules.
Both claimants and defendants can make Part 36 offers, before or during court proceedings. An offer can relate to the whole dispute or a particular part of it.
Unlike an ordinary settlement proposal, a valid Part 36 offer can have significant consequences for legal costs if it is rejected and the eventual judgment meets the relevant conditions.
For example:
If you are bringing a claim: You might offer to accept less than the full amount claimed. If the defendant rejects your offer and you subsequently obtain a judgment at least as advantageous, you may benefit from enhanced costs consequences.
If you are defending a claim: You might offer an amount you consider reasonable, even if you dispute liability. If the claimant rejects it but fails to obtain a more advantageous judgment, they may have to pay your recoverable legal costs from the end of the relevant period, subject to the applicable rules.
Making an offer does not mean admitting liability or accepting that your case is weak. Both sides can use Part 36 to encourage settlement and improve their position on costs.
Out-of-court settlements – why tactics matter in litigation
Most civil disputes are resolved through settlement rather than a final trial. This remains true even where formal proceedings have started and the parties have spent considerable time and money preparing their cases.
Settlement can happen at almost any stage, from early negotiations to shortly before trial. Sometimes it follows mediation or direct discussions between solicitors. In other cases, a carefully timed offer prompts one side to reconsider the risks of continuing.
Effective litigation is therefore as much about strategy, negotiation and timing as it is about legal arguments and preparing for court.
An experienced litigation solicitor will continually assess the evidence, likely outcome, costs and commercial pressures affecting both sides. The aim is to identify opportunities to improve your negotiating position and achieve a favourable settlement, while remaining prepared to proceed to trial if necessary.
Part 36 offers are particularly valuable because they combine a settlement proposal with potentially significant consequences for legal costs.
A good litigator does not simply wait for the other side to propose settlement. They actively consider when and how to create the best opportunity to resolve your dispute on favourable terms.
Strategic timing – when should you make a Part 36 offer?
The timing of an offer can be just as important as the amount.
An early offer can encourage settlement before significant costs are incurred and may provide valuable costs protection. However, an offer made before you properly understand the evidence may be too generous or too unrealistic to be effective.
A Part 36 offer may be particularly useful:
Early in the dispute: To test whether settlement is possible before substantial legal costs arise.
After disclosure: When important documents reveal strengths or weaknesses in either party's case.
Following witness statements or expert evidence: When the likely outcome becomes clearer.
Before a significant hearing: When both parties face further costs and may be more willing to negotiate.
Before trial: When the financial and commercial consequences of continuing are becoming immediate.
An experienced litigator considers not only what offer to make, but when it will have the greatest impact.
Sometimes the right approach is to make an offer early. In other cases, waiting for a particular document, expert report or procedural development may substantially improve your negotiating position.
Can you make several Part 36 offers during a case?
Yes. Both claimants and defendants can make successive Part 36 offers as a dispute develops.
You might make an early offer to encourage settlement, then make a different offer after disclosure or expert evidence changes your assessment of the case. You may also make offers addressing different issues or parts of the claim.
This can be particularly effective because litigation rarely remains static. New evidence emerges, legal costs increase, witnesses may prove stronger or weaker than expected, and the commercial circumstances of either party may change.
However, making a new offer does not necessarily cancel an earlier one. Previous offers may remain open for acceptance, and withdrawing or changing an offer can affect their costs consequences.
A skilled litigation solicitor will review settlement strategy throughout the proceedings and consider whether a further offer could improve your position.
The objective is not to make offers repeatedly for their own sake, but to use them when they are likely to influence the other side or strengthen your protection on costs.
Does making a Part 36 offer make you look weak?
No. Making a Part 36 offer does not mean you expect to lose or believe your case is weak.
A claimant with a strong case may deliberately offer to accept less than the full amount claimed to encourage settlement, avoid further expenditure and potentially obtain enhanced costs protection if the offer is rejected.
For example, you may believe you will recover £250,000 at trial but offer to accept £225,000 now. That may be a commercially sensible decision rather than a concession about the merits of your claim.
Similarly, a defendant who believes a claim is exaggerated may make a realistic offer to expose the claimant to adverse costs consequences if they continue and fail to achieve a better result.
Whether you are the claimant or defendant, a carefully judged offer can demonstrate confidence in your assessment of the case and put the other side under pressure.
The important question is whether the amount, timing and terms improve your overall position.
How long does a Part 36 offer remain open?
A Part 36 offer made at least 21 days before trial must normally specify a relevant period of at least 21 days. During this period, the usual prescribed costs consequences apply if the offer is accepted.
However, a Part 36 offer does not automatically expire after 21 days.
Unless it has been withdrawn or its terms provide for automatic withdrawal, it may remain capable of acceptance after the relevant period.
Accepting an offer late can have significant costs consequences. In some circumstances, the court's permission may be required.
Offers made shortly before trial, and offers that are withdrawn or changed, are subject to additional rules.
You should therefore obtain advice before assuming that an offer has expired, withdrawing it or accepting it after the relevant period.
What happens if you reject a Part 36 offer?
The consequences depend on who made the offer and what happens at trial.
If you reject a defendant's Part 36 offer - If you are bringing a claim and fail to obtain a judgment more advantageous than the defendant's offer, the court will generally order you to pay the defendant's recoverable costs from the end of the relevant period, together with interest on those costs, unless it would be unjust. For example, suppose you reject a defendant's offer of £150,000 but ultimately recover £130,000 at trial.Although you have won your claim, you may face a substantial costs liability because you failed to achieve a better outcome than the offer.
If the defendant rejects your Part 36 offer - If you are the claimant and obtain a judgment at least as advantageous as your own Part 36 offer, you may become entitled to additional benefits, subject to the applicable rules and the court's assessment. These can include eEnhanced interest on damages, costs assessed on the indemnity basis from the end of the relevant period, enhanced interest on those costs and an additional amount calculated by reference to the award, subject to a maximum of £75,000.
Different provisions apply in certain fixed-cost cases.
These potential consequences are what make Part 36 offers such a powerful negotiating tool. They can alter the financial risks of proceeding to trial, even where one party remains confident of success.
Should you accept, reject or counter a Part 36 offer?
If you receive a Part 36 offer, the amount proposed is only one part of the decision.
You should consider:
Your realistic prospects of achieving a better result.
The likely costs of continuing the litigation.
The potential Part 36 costs consequences.
Whether further evidence may strengthen or weaken your position.
Your opponent's ability to pay a judgment.
Whether a counteroffer might produce a better settlement.
An offer that initially appears unattractive may become commercially sensible when you consider legal costs, uncertainty and enforcement risks.
Equally, you should not accept an inadequate offer simply because it has been made under Part 36.
We can assess the offer against the likely outcome of the dispute and advise whether accepting, rejecting or making your own offer is the better course.
Can a Part 36 offer cover only part of a dispute?
Yes. A Part 36 offer can relate to the whole claim, part of it or a particular issue.
For example, you might make an offer concerning liability, the amount of damages or one claim within wider proceedings.
This can help narrow the issues and potentially avoid unnecessary costs, even where the entire dispute cannot be resolved.
However, the wording must be clear about what is being settled, and the costs consequences of partial offers can be more complicated.
Are Part 36 offers confidential?
Part 36 offers are generally treated as confidential from the trial judge until the relevant issues have been decided.
This allows the parties to explore settlement without the offer improperly influencing the court's determination of the dispute.
Once the relevant issues have been decided, the court can consider the offers when determining costs.
There are exceptions, particularly where only part of the proceedings has been determined.
How experienced litigators use Part 36 offers
The most effective litigation solicitors do more than prepare a case for trial. They continually assess how evidence, timing, settlement offers and costs risks can be used to improve their client's position.
At Taylor Rose, we consider:
The strength of your case: What are your realistic prospects of success, and on which issues?
The likely value of the outcome: What might a court actually award, rather than what either side initially demands?
The evidence: Is your position likely to improve or weaken as the case develops?
The costs: What will each side spend if proceedings continue, and how might Part 36 alter those risks?
Your opponent's circumstances: Are there financial, commercial or procedural pressures that may influence settlement?
The timing: Would an offer be more effective now or after a particular stage of proceedings?
Sometimes a well-pitched offer leads directly to settlement. In other cases, it strengthens your position on costs if the dispute proceeds to judgment.
Case study – using a tactical offer to protect the client's outcome
Taylor Rose acted for a homeowner pursuing a claim exceeding £14,000 over defective drainage and septic tank works.
Although the client's prospects on liability were strong, there was concern that the defendant might become insolvent if faced with a substantial judgment and costs order.
Our litigation solicitor, Daniel Worsley, developed a strategy involving a £1 Part 36 offer, alongside arrangements with the client's insurer designed to secure a £10,000 recovery for the client if the offer was accepted.
The defendant accepted the offer after the relevant period and subsequently challenged the costs consequences. The court upheld the approach, and that decision was upheld on appeal, although the published case study records a further appeal being sought.
The strategy was designed to secure a real financial outcome, reduce the risk of non-payment and avoid the costs of a full trial.
Read our case study – Strategic Litigation Offer Secures and Protects Client.
This illustrates why effective litigation strategy is not always about obtaining the largest possible judgment, but securing the best realistic result for your client.
How Taylor Rose can help
Our commercial litigation solicitors advise claimants and defendants on Part 36 offers at every stage of a dispute.
We can help you:
Assess the strength and realistic value of your claim or defence.
Decide when to make an offer and how much to offer.
Review offers received and explain the costs consequences.
Make further offers as the evidence and risks develop.
Negotiate settlement while protecting your position.
Evaluate whether proceeding to trial is commercially justified.
We understand that legal costs, timing and commercial outcomes matter. Our approach is to provide experienced, practical advice and use litigation tactics where they can make a genuine difference.
If you are involved in a dispute or have received a Part 36 offer, early advice can help you avoid costly mistakes and identify opportunities to strengthen your position.
Contact us to discuss your options.
