CPR 38 of the Civil Procedure Rules governs the procedure for discontinuing legal proceedings in England and Wales. Although discontinuance may appear to be a straightforward procedural step, it can carry important costs implications for the parties involved. For litigators and costs professionals, understanding how CPR 38 operates is essential when advising clients on litigation strategy, particularly where a party intends to discontinue a claim or withdraw all or part of a claim.

The rule determines not only the procedural steps required to bring proceedings to an end but also the circumstances in which a costs order may arise following discontinuance.

 

What CPR 38 Covers

CPR 38 forms part of the Civil Procedure Rules and deals specifically with the discontinuance of proceedings. It allows a claimant to discontinue all or part of their claim at various stages of litigation, provided the procedural requirements set out in the rules are followed.

In many cases the process is relatively straightforward. A claimant may file a notice of discontinuance and serve it on the other parties to formally end the proceedings or withdraw a specific part of a claim. Once the notice has been served, the claim will generally be treated as discontinued in respect of the issues identified in the notice.

However, CPR 38 also contains safeguards to ensure that discontinuance does not undermine earlier court orders or unfairly prejudice another party. In certain circumstances the claimant must obtain permission from the court before discontinuance can take effect.

 

When Permission of the Court Is Required

Although many claims can be discontinued by simply filing a notice, there are situations where the claimant must obtain the court’s approval.

For example, permission may be required where the claimant has received an interim payment during the course of the proceedings. In those circumstances the claimant cannot discontinue the claim unless the court has granted permission or the defendant consents in writing. This ensures that a claimant cannot simply accept funds during litigation and then bring the claim to an end without the court considering whether doing so would produce an unfair outcome.

Similarly, the court may need to review the position where the claimant has been granted an interim injunction or has provided an undertaking to the court. In these situations the court will often wish to consider the effect of discontinuance before allowing the proceedings to end.

These procedural safeguards help ensure that discontinuance is used appropriately within litigation and that previous court orders remain effective.

 

The Procedure for Discontinuing a Claim

Where permission is not required, the claimant may file a notice of discontinuance in accordance with CPR 38 and serve it on the relevant parties. Once served, the claim will be treated as discontinued either in full or in respect of the specific part of a claim identified within the notice.

In practice this means a claimant may discontinue all or part of the proceedings as litigation develops. For example, where a statement of case set out multiple causes of action, the claimant may decide to withdraw one aspect of the case while continuing to pursue another.

This flexibility allows parties to refine their litigation strategy as the case progresses, particularly where new evidence emerges or where certain elements of the claim are no longer considered viable.

 

Costs Consequences Under CPR 38

One of the most important aspects of CPR 38 concerns the costs consequences of discontinuance.

The general position is that costs arises on discontinuance. This means that where a claimant who discontinues proceedings does so, they will usually be responsible for the defendant’s legal costs incurred up to the date the notice of discontinuance is served.

In practical terms, the claimant will typically be ordered to pay the costs to be paid by the defendant for defending the claim up to that stage of the proceedings. These costs may include solicitors’ fees, counsel’s fees, court fees, and other litigation expenses associated with responding to the claim.

However, the rule is not absolute. The court retains discretion to depart from the usual position where appropriate, meaning that if the court orders otherwise the default costs consequences may be adjusted.

 

Discontinuance and Litigation Strategy

Discontinuance frequently arises as part of the wider litigation process, particularly where the parties approach settlement or where the claimant reassesses the strength of their case.

For example, it is common for proceedings to be discontinued after the parties agreed the sum payable in settlement, allowing the claim to be formally brought to an end without the need for a final hearing. In other cases, the claimant may choose to discontinue after the defendant has raised strong arguments in their defence or where new evidence affects the prospects of success.

Although discontinuance may be a sensible procedural step, courts remain aware that it can sometimes be used strategically, particularly where the defendant has already incurred significant legal costs preparing the case.

 

Special Considerations in Certain Types of Claims

The way CPR 38 operates may also depend on the procedural context of the case.

For example, discontinuance may arise in claims allocated to the small claims track, where recoverable costs are more limited than in other tracks. The court may also consider the procedural history of the dispute, including whether the claimant is discontinuing the entire claim or only a specific part of a claim arising out of the same facts.

In each case, the court will consider how the rule applies the court’s discretion and ensure the outcome remains fair to both parties.

 

Practical Importance for Costs Professionals

From a costs perspective, discontinuance often raises important questions regarding recoverability and enforcement.

Where proceedings are discontinued, the defendant will usually seek to recover the costs incurred in defending the claim, either through negotiation between the parties or through detailed assessment if agreement cannot be reached. The level of recoverable costs will often depend on the stage the proceedings had reached when the notice of discontinuance was served.

For costs draftsmen and costs lawyers, careful analysis of the procedural history and the work undertaken during the litigation is therefore essential when advising on the appropriate level of costs recovery following discontinuance.

 

FAQs

What does CPR 38 deal with?

CPR 38 forms part of the Civil Procedure Rules and governs how a claimant may discontinue proceedings, as well as the costs consequences that usually follow.

Can a claimant discontinue only part of their claim?

Yes. CPR 38 allows a claimant to discontinue all or part of the proceedings, meaning a specific part of a claim can be withdrawn while the remainder continues.

Do claimants need court permission to discontinue?

Not always. However, permission may be required if the claimant has received an interim payment or where earlier court orders require the court to review the position before discontinuance.

What happens to costs when a claim is discontinued?

In most cases, a claimant who discontinues proceedings will be responsible for the defendant’s costs incurred up to the date the notice of discontinuance was served, unless the court orders otherwise.

Can discontinuance happen after settlement?

Yes. It is common for proceedings to be discontinued after the parties agreed the sum payable in settlement, formally bringing the litigation to an end.

 

How Greener Costs Can Assist

Discontinuance under CPR 38 can create complex costs issues, particularly where proceedings have progressed and the defendant has already incurred significant legal costs. Understanding the procedural framework and the likely costs consequences is therefore important for practitioners seeking to protect their client’s financial position.

At Greener Costs, our experienced team of Costs Draftsmen and Costs Lawyers regularly assist practitioners with matters arising from discontinuance, including advising on recoverability, preparing bills of costs, and supporting negotiations following a costs order.

Greener Costs is also the UK’s first net positive legal costs company. Our operations are fully paperless, and we plant 25 trees for every instruction, helping law firms offset their carbon footprint while receiving specialist costs support.

If you would like to discuss a matter involving CPR 38 or require assistance with a costs issue, please contact our team on 01204 263047, email info@greenercosts.co.uk, or complete the enquiry form below.