How do you know if you have beaten a Part 36 offer in a personal injury claim?
October 8, 2025
It is 4.30pm in a County Court somewhere in England. It has been a long day, but the Judge has just handed down their judgment, and the Claimant has been successful. The costs need to be assessed, but this will either be a short summary assessment, or, in a fixed costs case, a slightly more complex calculation. But hopefully, everyone can be out of the court room before 5pm, and thereby avoid the wrath of the court staff.
Then, someone says the fatal words – “a Part 36 offer has been beaten”.
The Claimant had made a Part 36 offer in the sum of £11,000, and the judgment sum is £11,500. The Claimant is delighted. They have beaten their offer. The Judge will be awarding them an additional 10% on their damages, along with penalty interest on their damages, and an uplift to their costs. The Defendant looks glum.
But is this right? Has the Claimant actually beaten their offer at all?
Disclaimer
This article is meant to be a helpful introduction to the topic and is not legal advice to be relied upon. The law changes all the time and the facts of every case are different.
If any solicitors reading this would like some advice, please feel free to contact my clerks (info@exchangechambers.co.uk).
The starting point – the Civil Procedure Rules
CPR 36.17 sets out when a Part 36 offer has been beaten:
(1) Subject to rule 36.24, this rule applies where upon judgment being entered—
(a) a claimant fails to obtain a judgment more advantageous than a defendant’s Part 36 offer; or
(b) judgment against the defendant is at least as advantageous to the claimant as the proposals contained in a claimant’s Part 36 offer.
(2) For the purposes of paragraph (1), in relation to any money claim or money element of a claim, “more advantageous” means better in money terms by any amount, however small, and “at least as advantageous” shall be construed accordingly.
We can see that we are looking for an offer which is at least as advantageous to the party making the offer, than the terms of the judgment.
The basic idea inherent in Part 36 is that if you reject an offer, and fail to beat it, the costs consequences get triggered. You are effectively being punished for failing to accept a better deal when it was offered to you.
We are assuming for the purposes of this article that we are dealing with an offer which is compliant with Part 36.
The first way to trip up – post-expiry interest
The judgment sum will usually include a number of different components:
- General damages;
- Interest on general damages (2% per annum, running from the deemed date of service of the claim form);
- Special damages;
- Interest on special damages (usually running at the Special Account Rate, for non-continuing losses, from the date when the loss was incurred).
The interest will run up to the date when the judgment is being handed down. The longer that you wait for the final hearing, or the judgment (if it is being reserved), the greater the interest which will accumulate. You can have exactly the same damages being awarded, but the longer you wait for the case to conclude, the greater the interest will be. The judgment sum that the court will award is therefore getting bigger over time.
However, the Part 36 offer is not getting bigger over time. There is a danger that the Part 36 offer might end up being beaten simply because of the interest which has accumulated after the expiry of the offer.
The High Court in the case of Purrunsing v A’Court & Co (a firm) & Anor [2016] EWHC 1528 (Ch) made clear that in order to work out whether a Part 36 offer has been beaten, you have to ignore any interest accumulating after the expiry of the offer:
“As is apparent from the extract from the Rules set out above, by CPR r.36.5(4) a Part 36 offer to pay money is deemed to include all interest down to the date when the relevant period for acceptance of the offer expires. In order to work out whether a judgment is more advantageous than such an offer it is necessary to ensure that the offer or the judgment sum is adjusted by eliminating from the comparison the effect of interest that accrues after the date when the relevant offer could have been accepted. In my judgment this is the effect of the words “… better in money terms …” in CPR r. 36.17(2). If that is not done then comparing the offer with the judgment is not comparing like with like and thus it is not possible to assess whether the judgment is “… more advantageous …” in money terms than the offer. Interest compensates for the loss of use of money over a given period. In theory at least interest that accrues due for the period between the last date when the offer could have been accepted and the date of judgment is neutral and so immaterial in deciding the question whether a subsequent judgment is “… more advantageous …” than a previous offer. The only interest that is material is that included or deemed included within the offer.” [paragraph 15]
The High Court noted that under CPR 36.5(4), a Part 36 offer is deemed to include interest up to the expiry of the relevant period:
(4) A Part 36 offer which offers to pay or offers to accept a sum of money will be treated as inclusive of all interest until—
(a) the date on which the period specified under rule 36.5(1)(c) expires; or
(b) if rule 36.5(2) applies, a date 21 days after the date the offer was made.
Note that there is an additional subsection, (5), which was added after Purrunsing, and which allows the party making an offer to specifically deal with post-expiry interest:
(5) A Part 36 offer to accept a sum of money may make provision for accrual of interest on such sum after the date specified in paragraph (4). If such an offer does not make any such provision, it shall be treated as inclusive of all interest up to the date of acceptance if it is later accepted.
So, in order to work out whether a Part 36 offer has been beaten, assuming the offer only includes interest up to the expiry of the relevant period, you are comparing two things:
- The sum offered in the Part 36 offer;
- The judgment sum minus any post-expiry interest.
Does this mean that you need to work out (1) the interest on general and special damages as a whole, and (2) the interest on general and special damages until expiry of the offer? Yes it does! What a pain.
So, in our example, if the judgment sum of £11,500 includes £600 of post-expiry interest, the Part 36 offer in the sum of £11,000 has not been beaten, and there should not be any Part 36 consequences.
The second way to trip up – CRU
CRU is a complex topic, and anyone wanting to know more is welcome to read my article ‘A practical guide to CRU: the recovery and offsetting of state benefits in personal injury claims’. The article sets out in detail how the recovery and offsetting of state benefits works in practice, the meaning of ‘gross of CRU’ and ’net of CRU’, and so on.
The main thing to remember is where there are recoverable benefits, you may need to work out how the offsetting of these benefits affects (1) the judgment sum, and (2) the terms of the offer, before deciding whether an offer has been beaten.
The way I would try and work out whether a Part 36 offer (for simplicity, a Defendant’s offer) has been beaten in a case where there are recoverable benefits is as follows:
Net of CRU: We compare the sum which the Judge gives the Claimant in their hand (that is, after any deductions of recoverable benefits, and post-expiry interest), to the sum which the Defendant wanted to give them in their hand.
Gross of CRU: This is not very clear – Crooks v Hendricks Lovell Ltd [2016] EWCA Civ 8 suggests that you compare the overall judgment sum (that is, before any deductions of recoverable benefits) to the gross sum which the Defendant offered, but I prefer CPR 36.20(8), which suggests that for a Defendant’s offer, you look at the net figures (as you would for an offer net of CRU).
If either party intends to review or appeal a CRU certificate, this may lead to the sums on the CRU certificate being amended, and so there may be uncertainty over whether a Part 36 offer in a case where there are recoverable benefits has been beaten. It may be necessary to apply for an adjournment after the judgment is handed down to allow the CRU certificate to be reviewed or appealed.
Conclusion
It is always worth checking carefully whether a Part 36 offer has been beaten. This can be quite a difficult job. It is often those who do not realise how difficult a job it is, who try to rush the process. You always need to be able to stand your ground.
N.B. This article was amended in October 2025 to amend the wording of the line which starts ‘We can see that we are looking for an offer…’.
