Gibbon v Manchester City Council

26 July 2010
By Michael Hayes

Gibbon v Manchester City Council [2010] EWCA Civ 726, has clarified the use of Part 36 of the Civil Procedure Rules (“CPR”) relating to the offer and acceptance of settlements under the CPR. Part 36 was held by the Court of Appeal to be a “self contained code” which did not include any other law unless the CPR expressly included it. According to the Court of Appeal the CPR was specifically designed to be clear and certain so that ordinary people, with no legal training, could follow it without expert advice.
Part 36 allows a party to make multiple offers to settle for different amounts depending on how strong they feel their case is at that any given point in time. If an offer is rejected and the rejecting party fails to win a larger amount than that offer at trial they will have to pay the other side’s costs plus interest from 21 days after the date of that rejected offer. Under Part 36 offers remain on the table unless expressly withdrawn in writing and later offers do not revoke or amend earlier ones. This is in contrast to general contract law where only one offer can be valid at any one time. According to the Court of Appeal, the purpose of this multiple offer approach is to allow a party to leave various settlement offers on the table which, despite being initially rejected, can tempt the other side into acceptance later in the litigation process.