Late Acceptance of Part 36 Offer | Fixed Costs Apply at Relevant Period Expiry Despite Later Multi-Track Allocation

The Court of Appeal has clarified that a claimant who accepts a Part 36 offer late in an ex-Protocol claim is restricted to fixed costs applicable when the offer’s relevant period expired, even where the claim is subsequently allocated to the multi-track.

ATTERSLEY V UK INSURANCE LIMITED [2026] EWCA Civ 217

In Attersley v UK Insurance Limited [2026] EWCA Civ 217, the Court of Appeal determined the costs consequences of a claimant’s late acceptance of a defendant’s Part 36 offer in a personal injury claim that had started under the Pre-Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents. The claim had exited the Protocol, was issued under Part 7 CPR, and was later allocated to the multi-track. The defendant’s Part 36 offer was accepted after its 21-day relevant period had expired. The issue was whether the claimant’s costs were governed by the fixed costs regime in CPR 36.20 and Section IIIA of Part 45, or by the standard basis assessment under CPR 36.13. Overturning the High Court, the Court of Appeal held that CPR 36.20 applied. Lord Justice Miles, with whom Lady Justice Falk and Lord Justice Lewison agreed, reasoned that the claim fell within the scope of Section IIIA of Part 45 when the relevant period expired, as allocation to the multi-track occurred later. Following Qader v Esure Services Ltd [2016] EWCA Civ 1109, the phrase “for so long as the case is not allocated to the multi-track” in rule 45.29B operated prospectively, not retrospectively. The court found the defendant’s construction promoted certainty and the Part 36 objective of encouraging early settlement, preventing a claimant from improving their costs position via a later, uncontrollable event. The appeal was allowed, restoring the first-instance order that the claimant was entitled only to fixed costs under Table 6B of Part 45 for the stage applicable when the relevant period ended.

The principal issue on this appeal is whether the costs consequences of the Claimant’s acceptance of the Part 36 offer fall to be determined under rule 36.13 on the one hand, or under rule 36.20 on the other... In my judgment, in a case where, on the date on which the relevant period contained in a Part 36 offer expires the claim still falls within the scope of Section IIIA, the consequences of acceptance of the offer are governed by rule 36.20 rather than rule 36.13, even in a case which is subsequently allocated to the multi-track.

Citations

Qader v Esure Services Ltd [2016] EWCA Civ 1109 The fixed costs rules in Section IIIA of Part 45 cease to apply to claims allocated to the multi-track. Williams v Secretary of State for Business Energy and Industrial Strategy [2018] EWCA Civ 852 Williams concerned the discretionary assessment of costs at a level equivalent to fixed costs when a claimant’s conduct was deemed unreasonable. Solomon v Cromwell Group Plc [2011] EWCA Civ 1584 The more specific rule takes precedence over more general rules when resolving conflicts within the CPR. OMV Petrom SA v Glencore International AG [2017] EWCA Civ 195 Illustrated that Part 36 operates as both a carrot and stick by placing the costs risk onto the offeree to incentivise early settlement.

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Key Points

Where a Part 36 offer is accepted after the expiry of the relevant period, the claimant’s entitlement to costs is generally fixed by reference to the costs regime applicable on the date that period expired, not by any subsequent change in procedural track. [55-56, 63]
The specific costs consequences for accepting a Part 36 offer in a claim that started under but exited the RTA Protocol are governed by CPR 36.20, and this rule takes precedence over the more general provisions of CPR 36.13 where it applies. [49, 62]
The disapplication of the fixed recoverable costs regime in Section IIIA of Part 45 upon allocation of a case to the multi-track operates prospectively from the date of allocation; it does not retrospectively re-characterise the costs regime applicable to earlier stages of the litigation for the purposes of Part 36. [57, 59-60]
The principle of certainty in the operation of Part 36 supports an interpretation that anchors a defendant’s costs liability to the recoverable costs applicable during the offer’s relevant period, preventing uncertainty based on later, contingent events such as track allocation. [61, 63]
Where a potential conflict arises between a specific procedural rule governing a particular type of claim and a more general rule, the specific rule is to be given precedence. [62]

"In para 56 Briggs LJ said that the best way to give effect to the legislative intention was to insert 'and for so long as the claim is not allocated to the multi-track' into rule 45.29B... I am unable to accept this argument for the reasons already given. If rule 36.20 is the governing rule, it requires the application of the fixed costs rules in Part 45 applicable on the date on which the relevant period expires in any case which has not, by that date, already been allocated to the multi-track."

Key Findings In The Case

The Claimant accepted the Defendant’s Part 36 offer after the expiry of the relevant period without any explanation for the delay, and by that time, the case had been allocated to the multi-track [14].
The costs to which the Claimant was entitled were determined by the costs regime applicable on the last day of the relevant period for the Part 36 offer, which meant she was entitled only to fixed costs since the case had not yet been allocated to the multi-track at that time [55-56].
Rule 36.20, which specifically addresses the costs consequences for ex-Protocol claims like this one, took precedence over the more general Rule 36.13 regarding the costs consequences of accepting a Part 36 offer after the relevant period, limiting the Claimant to fixed costs [49].
The application of the fixed recoverable costs regime ceased to apply prospectively from the date of the case’s allocation to the multi-track; it did not alter the costs regime that was in place during the offer’s relevant period [57, 59-60].
The court emphasised the principle of certainty in the operation of Part 36, which supports anchoring the defendant’s costs liability to the applicable costs regime during the relevant period of the offer, thus avoiding uncertainty due to later procedural changes like track allocation [61, 63].

"In my judgment, in a case where, on the date on which the relevant period contained in a Part 36 offer expires the claim still falls within the scope of Section IIIA, the consequences of acceptance of the offer are governed by rule 36.20 rather than rule 36.13, even in a case which is subsequently allocated to the multi-track... It would be surprising if the Claimant were to become entitled to a substantially greater amount of costs by accepting the offer after the expiry of the relevant period by reason of events occurring after the end of that period, and outside the parties’ control."

The Court of Appeal’s decision in Attersley v UK Insurance Limited [2026] EWCA Civ 217 resolves an important question about the interplay between Part 36 costs consequences and the fixed costs regime for claims that exit the Pre-Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents.

Background

The claim arose from a road traffic accident on 9 March 2018. The claimant, Laura Attersley, initiated her claim under the Pre-Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents (the RTA Protocol) on 19 March 2018, valuing it at up to £10,000. The claim exited the protocol on 9 April 2018 after the defendant, UK Insurance Limited, disputed liability pending enquiries. Liability was subsequently admitted on 29 April 2019.

Shortly before limitation expired, the claimant issued a Part 7 claim form on 13 February 2021, now valuing the claim at up to £150,000 with reference to ongoing physical and psychological issues. The defendant filed a defence admitting liability on 4 March 2021 and, on the same day, made a Part 36 offer of £45,000. The 21-day relevant period for acceptance expired on 25 March 2021.

The case was allocated to the multi-track at a case management conference on 5 January 2022. A costs management order was made. It was agreed by the parties at the CMC that the case was suitable for the multi-track given the quantum claimed, the expert evidence required, and the time estimate for trial. On 8 July 2022, the claimant accepted the defendant’s Part 36 offer, which had not been withdrawn. The acceptance was late, occurring well after the expiry of the relevant period. A dispute arose as to the correct basis for assessing the claimant’s costs up to the date of acceptance, leading to a costs hearing.

Costs Issues Before the Court

The central issue was determining the costs consequences of the claimant’s late acceptance of the defendant’s Part 36 offer. The dispute turned on which rule in CPR Part 36 governed the situation. The claimant argued that because the case had been allocated to the multi-track by the date of acceptance, the fixed costs regime in Section IIIA of Part 45 was disapplied, and therefore her costs fell to be assessed on the standard basis under CPR 36.13. The defendant contended that the claim, having started under the RTA Protocol, was governed by the specific costs consequences for such cases set out in CPR 36.20, which provided for fixed costs even on late acceptance. The court had to decide whether allocation to the multi-track retrospectively ousted the application of rule 36.20.

The Parties’ Positions

The defendant argued that its construction was dictated by the plain wording of the rules. Rule 36.20(1) applied where a claim no longer continued under the RTA Protocol, which was the case here. Rule 36.20(4) specifically addressed late acceptance, entitling the claimant only to fixed costs for the stage applicable when the relevant period expired. It was submitted that rule 36.20 was a specific provision dealing with ex-Protocol claims, which should prevail over the more general rule 36.13. The defendant argued that the claimant’s interpretation would create a perverse incentive to delay accepting offers to try and secure a more favourable costs regime upon later allocation, undermining the purpose of Part 36 to encourage early settlement.

The claimant’s primary argument relied on the Court of Appeal’s decision in Qader v Esure Services Ltd [2016] EWCA Civ 1109. She submitted that the effect of allocation to the multi-track was to disapply the fixed costs regime in Section IIIA of Part 45 entirely. Consequently, the claim no longer fell within the scope of rule 36.20, and the default position in rule 36.13 applied, with costs to be assessed on the standard basis. The claimant emphasised that her claim was always suitable for the multi-track and she was not seeking a windfall, but rather the costs appropriate to such a case. She also advanced an alternative argument that even if rule 36.20 was engaged, rule 36.13(3) (“except where the recoverable costs are fixed by these Rules”) meant standard costs applied because allocation had disapplied the fixed costs.

The Court’s Decision

The Court of Appeal allowed the defendant’s appeal, restoring the order that the claimant was entitled only to fixed costs. Lord Justice Miles, giving the leading judgment with the agreement of Lady Justice Falk and Lord Justice Lewison, held that rule 36.20 applied and that the claimant was restricted to the fixed costs applicable at the date the relevant period expired.

The court found that the natural and straightforward reading of the rules was that where, on the date the relevant period of a Part 36 offer expired, the claim was still within the Section IIIA fixed costs regime (i.e., not yet allocated to the multi-track), the consequences of acceptance were governed by rule 36.20. Rule 36.20(4) expressly fixed the claimant’s entitlement by reference to the costs stage applicable at the expiry date of the relevant period. In this case, that date (25 March 2021) was long before allocation to the multi-track (5 January 2022).

The court confined Qader to its context and rejected the claimant’s broad proposition that it had retrospective effect for all purposes, including Part 36. It held that Qader decided that the fixed costs regime should not apply to a case once it was allocated to the multi-track, but it did not establish that allocation operated to treat the case as if it had never been within the regime for all purposes, retrospectively. The words “for so long as the case is not allocated to the multi-track” in rule 45.29B had a temporal meaning; the regime ceased to apply prospectively from allocation, not retrospectively. The court noted that Qader did not have to consider the interplay with other rules or the question of potential retrospective effect of allocation for other purposes.

The court emphasised that this interpretation promoted certainty and coherence with the purpose of Part 36. Drawing on the reasoning in Qader itself, where Briggs LJ had explained that requiring parties to guess whether a case which settled prior to allocation was subject to fixed costs would introduce damaging uncertainty, the court held that the claimant’s interpretation would similarly bring undesirable uncertainties into the operation of Part 36. It ensured that a defendant’s liability for costs was anchored to the costs environment applicable during the period when the claimant was deciding whether to accept the offer. It would be surprising and potentially unjust if a claimant could improve their costs position by accepting late, based on a subsequent allocation outside the defendant’s control. This would undermine the regime’s aim of encouraging early settlement.

The court rejected the claimant’s alternative argument based on rule 36.13(3). It gave two reasons: first, rule 36.13 is expressed to be “subject to” rule 36.20, so it was necessary to determine whether rule 36.20 applied before considering the specific wording of rule 36.13(3); and second, where a case continued to come within the fixed costs regime on the date when the relevant period ended, the recoverable costs were indeed “fixed” by the rules for the purposes of rule 36.13(3).

The court concluded there was no conflict between the rules, but if there were, the specific rule 36.20 would prevail over the more general rules in Part 45. The court also noted that the Rules Committee may wish to consider scenarios where a Part 36 offer is made after multi-track allocation or where the relevant period expires after such allocation, as the existing rules do not yield entirely straightforward answers in such cases. The court noted that at first instance, Stacey J had found that the claim was “always likely to be allocated to the multi-track” once the Part 7 form was issued, yet the court reached its decision favouring fixed costs even in such a case, underscoring the strength of the rule-based and policy reasoning.

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