The concept of a “genuine attempt to settle” has become an increasingly important feature of Part 36 jurisprudence under the Civil Procedure Rules. While the rules do not expressly define the term, the High Court has made it clear that not every Part 36 offer will attract the usual costs consequences.

The question of what constitutes a genuine attempt to settle Part 36 is therefore more than academic. It goes directly to whether an offer will trigger the powerful costs consequences associated with the regime and whether a settlement offer is genuinely aimed at resolving the dispute.

In practice, this has led to a growing body of case law examining whether offers made under Part 36 are genuinely aimed at compromise or whether they are purely tactical.

 

What is Meant by a “Genuine Attempt to Settle”?

Although not formally defined in the rules, the requirement that a Part 36 offer is intended to encourage parties to resolve disputes, not to reward purely tactical behaviour. An offer that has no real prospect of being accepted, or which is structured solely to secure costs advantages, may fall outside the intended scope of the regime.

This is where the distinction between a valid offer and an effective one becomes important. An offer may comply technically with Part 36, yet still fail to achieve its intended costs consequences if it does not reflect a real willingness to compromise.

 

The Rise of “Token Offers”

One of the most debated areas in this context is the use of so-called “token offers.”

These are typically par 36 offers to settle the proceedings made at a very high percentage of the claim, often close to the full value of the claim, with the intention of triggering indemnity costs if the claimant ultimately succeeds at trial.

From a purely technical perspective, such offers may appear compliant with the rules. However, courts have increasingly questioned whether they represent a genuine attempt at settlement or whether they are simply tactical devices.

The concern is that such offers do not meaningfully engage with settlement. Instead, they are designed to place the opposing party in a position where refusal carries disproportionate risk.

 

Key Case Law on Genuine Attempts to Settle

The courts have addressed this issue in several important decisions, helping to shape the modern approach.

In JMX v Norfolk Hospitals NHS Foundation Trust, the High Court emphasised that Part 36 is intended to promote genuine settlement, and that offers must be considered in that context. The court accepted that even a high-percentage offer may still represent a genuine attempt to settle, depending on the circumstances of the case.

Similarly, in Huck v Robson, an offer of 95% of the claim was upheld as a valid Part 36 offer, but the decision highlighted the fine line between a genuine attempt to settle and a purely tactical move.

Then again, in Rawbank SA v Travelex Banknotes Ltd, the court reiterated that there is no fixed rule as to what constitutes a genuine attempt to settle. Instead, the court must consider all the circumstances, including the information available to the parties at the time the offer was made.

These authorities demonstrate that the issue cannot be reduced to a simple formula. Whether an offer represents a genuine attempt to settle is a fact-sensitive assessment that depends on the context of each case.

 

When Does a Part 36 Offer Become “Non-Genuine”?

A Part 36 offer may be considered non-genuine where it lacks any real element of compromise.

This can arise where:

• The offer is so close to the full value of the claim that it offers no meaningful concession
• The timing of the offer suggests it is designed to secure costs advantages rather than promote settlement
• The offer is made without sufficient information to allow proper evaluation
• The offer is part of a wider tactical strategy rather than a genuine attempt to resolve the dispute

In such cases, the court may conclude that the offer should not attract the usual costs consequences, even if it is technically valid.

 

The Role of Judicial Discretion

It is important to note that the consequences of a Part 36 offer are not entirely automatic.

Under CPR 36.17, the court must take into account all the circumstances of the case when deciding whether it would be unjust to apply the usual consequences. This includes considering whether the offer was a genuine attempt to settle.

Where a claimant succeeds in beating its own offer, the court would ordinarily order:

• Costs on an indemnity basis
• Interest on those costs, often above the base rate
• An additional amount, subject to the statutory cap

However, where an offer is not considered genuine, the court may decline to award these enhanced benefits.

This acts as an important safeguard against misuse of the regime.

 

Practical implications for Litigants

For practitioners, the message is clear: Part 36 should not be treated as a purely tactical tool.

While strategic considerations are inevitable, offers must still reflect a genuine attempt to settle the dispute.

This requires careful thought about:

• The level of compromise offered
• The timing of the offer
• The information available at the time
• The overall context of the litigation

A poorly judged offer may not only fail to achieve its intended effect but could also undermine a party’s position on costs.

 

A Fine Balance Between Strategy and Substance

The tension at the heart of this issue is clear.

On the one hand, Part 36 is designed to encourage settlement through clear and sometimes harsh costs consequences. On the other hand, the courts are increasingly alert to the risk of parties exploiting the regime for tactical advantage.

The concept of a genuine attempt to settle sits at the intersection of these two principles.

Offers must be robust enough to protect a party’s position, but also realistic enough to demonstrate a genuine willingness to resolve the dispute.

 

How Greener Costs Can Help

Assessing whether an offer constitutes a genuine attempt to settle requires a detailed understanding of both a Part 36 and the developing case law.

At Greener Costs, we provide specialist advice on all aspects of Part 36 strategy, including:

• Evaluating whether an offer is likely to be considered genuine
• Advising on the risks of an invalid Part 36 offer
• Assessing exposure to adverse costs consequences
• Supporting arguments around costs at trial and on assessment

Whether you are making or responding to Part 36 offers, expert input can be critical in protecting your position.

Contact Greener Costs today via our enquiry form below, call 01204 263047, or email info@greenercosts.co.uk to discuss how we can support your case.