Sutherland v Turnbull [2010] EWHC 2699 (QB)

[2010] EWHC 2699 (QB)

Case No 8NE90072

IN THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

NEWCASTLE-UPON TYNE DISTRICT REGISTRY

Newcastle Crown Court

Quayside

Date 26 October 2010

Before

THE HONOURABLE MR JUSTICE STADLEN

Between

TRACY SUTHERLANDClaimant

FRANK TURNBULLDefendant

MR JOEL DONOVAN (instructed by Irwin Mitchell LLP) for CLAIMANT

MR SIMON BROWNE (instructed by Keoghs LLP) for DEFENDANT

Hearing Hearing dates: 5 October 2010

Judgment

[1]I am required to adjudicate on a dispute between the claimant and the defendant in a personal injury action as to the costs consequences flowing from the acceptance by the claimant of a Part 36 Offer made by the defendant. The Part 36 offer was made in two emails from the defendant’s solicitor to the claimant’s solicitor dated 3 September 2010 and accepted in an email from the claimant’s solicitor to the defendant’s solicitor dated 15 September 2010. The matter comes before the court by way of an application notice issued by the defendant on 27 September 2010 seeking an order that costs in relation to what are described as “the issues of liability and causation” should be reserved until the conclusion of the issue of quantum which remains to be determined or in the alternative pursuant to CPR Part 36.10(2) an order for the court to exercise its discretion in relation to the costs of the proceedings in relation to “liability and causation”. The claimant resists the application on the ground that pursuant to Part 36.10(1) she is entitled as of right to an order that the defendant pay her costs of the proceedings up to 15 September 2010, the date on which notice of acceptance was served on the defendant.

Background

[2]The dispute arises in the context of an action brought by the claimant against the defendant for injuries sustained in most unusual circumstances. At approximately 11.50pm on 26 December 2005 the claimant, then aged 40 years, was being driven home from a party by her husband in their Peugeot 307 car. It is alleged by the defendant that they were both very drunk. Whilst travelling along Ouston Lane, near Chester le Street in County Durham the claimant fell out of the car from the front passenger seat into the road whilst it was still moving. It is alleged by the defendant that she jumped from the car. As she lay motionless in the road she was run over by the defendant’s Citroen Saxo which was travelling in the same direction but a long distance behind. By the time the defendant approached the claimant’s body her husband, subsequently the Part 20 defendant, had turned his car around and was flashing his lights towards the defendant, a manoeuvre designed to alert him to the presence of his wife on the road but which the defendant claimed only served to distract him from the road in front and make her body harder to see.

[3]The claimant sustained multiple injuries. In particular and most seriously she sustained a traumatic brain injury and complex fractures of the skull. These are said to have led to ongoing symptoms of cognitive impairment and personality change including irritability, loss of motivation and attention, vertigo and memory loss. A preliminary schedule of loss attached to the Amended Particulars of Claim claimed over £170,000 for past and future loss of earnings and un-quantified claims for personal care and other long term costs.

[4]In addition the claimant sustained other injuries. These were conveniently set out in a medical report prepared on behalf of the defendant by Doctor Alison Armour, a consultant Home Office pathologist. They constituted injuries to the claimant’s chest, abdomen and back, in the first two cases broken down into particular injuries including, in the case of her chest, bilateral scapula fractures.

[5]Proceedings were issued on 28 December 2008 with Particulars of Claim dated 16 January 2009. Before serving his Defence the defendant served a notice to admit facts asking if the claimant admitted that her head injuries were sustained in her fall from her husband’s vehicle as opposed to when she was run over by the defendant’s vehicle. The notice to admit was served on 27 February 2009 and on 1 April 2009 the claimant served a response in the form of a non-admission.

[6]On 12 May 2009 the defendant served a Defence denying negligence and denying that such injury, loss or damage as the claimant might prove was caused by any negligence on his part. He accepted that he ran the claimant over and that he did not see her lying in the road but averred that that was not because of any failure on his part to exercise reasonable care. He alleged that his attention was distracted by the claimant’s husband flashing the lights of his car which caused him to fail to see the claimant lying in the road. Further or alternatively he alleged that such injury as the claimant might prove was caused alternatively contributed to by her own negligence in allowing herself to become so intoxicated that she could not behave reasonably as a car passenger, allowing herself to be driven by her husband when she knew that he was intoxicated and jumping out of the car when it was moving. In the further alternative he alleged that such injury as the claimant might prove was caused or alternatively contributed to by the negligence of her husband as set out in a Part 20 claim against him which accompanied the Defence.

[7]It was admitted that the claimant suffered some injury in the accident but the nature and extent of such injury was not admitted. In particular it was pleaded that the fact that the claimant was conscious when she allegedly jumped from her husband’s car but lying unconscious in the road when the defendant ran her over is evidence that any head injury she may prove to have sustained was not the result of being run over but of jumping from her husband’s car.

[8]On 17 August 2009 Deputy District

Judge Silver ordered a split trial in the following terms:

“There be a split trial on the issue of:- (a) liability as between claimant and defendant in main claim (b) liability as between claimant and defendant in additional claim (c) claimant contributory negligence (d) injuries sustained by claimant as a result of the defendant’s vehicle running over her as opposed to claimant jumping out of the Part 20 defendant’s vehicle and all further directions be limited to that issue.”

Disclosure was ordered limited to “issues of liability”. Provision was made for the exchange of factual witness statements by 8 December 2009 and leave was given to each party to “instruct one expert in the field of (a) forensic pathology (b) neurologists (c) orthopaedic consultant and (d) consulting engineer to give written evidence only provided their reports are exchanged by 23 February 2010.” The Deputy District Judge directed that the hearing of “the trial of this matter” was to take place on 1 October 2010 with an estimate of 4 days.

[9]On 23 October 2009 the defendant obtained judgment in default on his Part 20 claim against the claimant’s husband, Mr Sutherland, for liability with damages to be assessed. On 8 June 2010 the parties were given permission to rely on oral expert evidence at trial in the fields of accident reconstruction, pathology, orthopaedics and neurology. Time for exchange of expert evidence was extended to 25 June 2010 and the parties were ordered to meet to consider possible resolution of “the liability issues or to narrow the issues” by 16 July 2010.

[10]By May 2010 the claimant and the defendant had exchanged expert evidence in all four areas of expertise save that the claimant did not serve a report from a neurologist.

[11]Prior to the defendant’s Part 36 offer of 3 September 2010 which was in due course accepted by the claimant on 15 September 2010, there had been Part 36 offers which had not been accepted and also two without prejudice offers made by the defendant which were not accepted. It is the defendant’s case that if the court retains a discretion under Part 36.10(2) as to the appropriate costs order to be made (which he submits it does), then the failure of the claimant to accept at any rate the second of his without prejudice offers is a matter to be taken into account in the exercise of that discretion.

[12]The defendant’s Part 36 order which was in due course accepted by the claimant was contained in an email dated 3 September 2010 from Rada Dragicevic, the defendant’s solicitor to John Davis, the claimant’s solicitor. The email contained two alternative Part 36 offers. The first was an offer to contribute 30% of the damages and consequential loss arising from a list of injuries sustained in the road traffic accident. That list critically did not include the bilateral scapula and head/facial injuries. In the email it was stated “for the sake of clarity” that those injuries were sustained as a result of the fall to the road on exiting the moving vehicle and before any subsequent “running over” by the defendant’s vehicle. It was this offer which was accepted by the claimant in her solicitor’s email dated 15 September 2010. The second Part 36 offer contained in the 3 September email, which was not accepted, was an offer to settle “the whole of the claimant’s claim” in the sum of £10,000 net of CRU. That offer was subject to three conditions including acceptance by the claimant that her costs would be capped at £50,000 including various items. It was stated that if the claimant accepted that offer the defendant would agree not to enforce the judgment obtained against her husband to the Part 20 defendant. The email expressed the hope that the offers would be accepted ideally before the hearing on 10 September which was scheduled for determination of the claimant’s husband’s application to set aside judgment against him in the Part 20 proceedings.

[13]The 3 September email from Ms Dragicevic to Mr Davis was in the following terms:

“Following our discussion earlier today I have taken instructions from my client. Taking into account that the offer that you will be making is unlikely to be much less than your previous Part 36 Offer as you say it seems that we will still be far apart on Tuesday making a settlement unlikely. There is clearly a significant difference between our experts in relation to causation and it seems unlikely that this will change post the joint statements. We feel that your client will struggle to prove her case on primary liability let alone causation. She relies on the evidence of her husband who lacks any credibility taking into account the evidence he gave to the police. In the circumstance, there seems to be little benefit in an actual meeting on Tuesday and instead we will provide you with what would have been our “best” offer on Tuesday. Please take instructions and give me/Andrew a call if you wish to discuss the offer. The offers are as follows:- Part 36 Offer 1 The Defendant offers to contribute 30% of the damages and consequential loss arising from the following injuries sustained in the road traffic accident 26.12.2005:- Multiple rib fractures to the left and right side Bilateral haemothoraces Pulmonary contusions Bruises and multiple abrasions to the left Retroperitoneal haemorhage Serosal tears to the colon and near to the pancreas Bruising and abrasions to the back Degloving injury to the right upper limb For the sake of clarity the bilateral scapula and head / facial injuries described at items 1 to 6 inclusive under the hearing “Head” in respect of Dr Armour dated 24.05.2010 were sustained as a result of the fall to the road on exiting the moving vehicle and before any subsequent “running over” by the Defendant’s vehicle. In the alternative we offer:- Part 36 Offer 2 The Defendant offers to settle the whole of the Claimant’s claim in the sum of £10,000 net of CRU benefit subject to the following conditions:- This offer is on the basis that the Claimant will agree a Tomlin order that reflects a 70% reduction in her damages for contributory negligence. This offer is also conditional on any CRU adjustment on review or appeal being retained by the Defendant and the Claimant assisting the Defendant in respect of the CRU appeal / review. This offer is also conditional on the Claimant accepting that her costs will be “capped” at £50,000 including profit costs, VAT, disbursement and all additional liabilities i.e. success fees and insurance premiums. If the Claimant accepts this offer the Defendant will agree not to enforce the judgment obtained against the part 20 Defendant. We looking forward to hearing from you as soon as possible and if you are unable to accept our offers, ideally before the hearing on 10 September in relation to Mr Sutherland’s application to set aside judgment. Kind Regards, Rada”

Part 36 Offer 1 Multiple rib fractures to the left and right side Bilateral haemothoraces Pulmonary contusions Bruises and multiple abrasions to the left Retroperitoneal haemorhage Serosal tears to the colon and near to the pancreas Bruising and abrasions to the back Degloving injury to the right upper limb In the alternative we offer:- Part 36 Offer 2 Rada”

Part 36 Offer 2

[14]Ms Dragicevic’s email was timed at 16.08pm. At 16.22pm Mr Davis replied as follows:

“…I will take instructions. I should point out that your second offer is not consistent with the provisions of Part 36 so I will treat that offer as a “without prejudice”, not a “Part 36” one.”

At 16.50pm Ms Dragicevic replied to Mr Davis:

“For the avoidance of doubt both offers are made pursuant to Part 36. The offers will remain open for acceptance for 21 days from receipt. The offers are intended to have the costs consequences of CPR Part 36. Sorry I did not make this clear in my previous email.”

[15]There followed negotiations conducted by email in which the claimant sought to persuade the defendant to improve the terms of the offers which were unsuccessful. During the course of those negotiations the claimant’s husband succeeded in setting aside the Part 20 judgment which the defendant had entered against him.

[16]On 15 September 2010 the claimant accepted the defendant’s first Part 36 offer in an email of that date from Mr Davis to Mr Underwood, another solicitor acting for the defendant. The email was in these terms:

“Sent on behalf of John Davis Dear Andrew The Claimant accepts your client’s Part 36 offer number 1 as follows:- The Defendant will contribute 30% of the damages and consequential loss arising from the following injuries sustained in the road traffic accident 26.12.2005:- Multiple rib fractures to the left and right side Bilateral haemothoraces Pulmonary contusions Bruises and multiple abrasions to the left side Retroperitoneal haemorrhage Serosal tears to the colon and near to the pancreas Bruising and abrasions to the back Degloving injury to the right upper limb In view of the settlement which has now been reached, we will inform the court and our experts that the trial listed for the 5th October will not now be proceeding. We will draft a consent order and send it to you for your approval later today. Please acknowledge safe receipt of this email John”

Dear Andrew The Claimant accepts your client’s Part 36 offer number 1 as follows:- Multiple rib fractures to the left and right side Bilateral haemothoraces Pulmonary contusions Bruises and multiple abrasions to the left side Retroperitoneal haemorrhage Serosal tears to the colon and near to the pancreas Bruising and abrasions to the back Degloving injury to the right upper limb Please acknowledge safe receipt of this email John”

Please acknowledge safe receipt of this email

[17]On 21 September 2010 the claimant’s solicitors sent a draft consent order to the defendant’s solicitors. It provided for judgment for the claimant against the defendant for a sum of damages to be assessed by the court on the basis that the defendant should pay 30% of the claimant’s damages and consequential loss arising from the injuries listed in the first Part 36 offer. Trial on liability between the claimant and the defendant listed to commence on 5 October 2010 was to be vacated. The matter was to be listed for a case management conference by telephone on the next available date for directions in relation to quantum. As to costs the draft consent order provided:

“The defendant shall pay the claimant’s costs on the issue of liability on the standard basis if not agreed to be subject to detailed assessment at the conclusion of this action.”

The defendant’s solicitor declined to agree to a costs order in those terms and that led to the issuing by the defendant of the application which is now before the court.

Discussion

[18]The essential dispute between the parties appears on analysis to turn on the question whether the defendant’s Part 36 offer which was accepted by the claimant “relates to part only of the claim” within the meaning of Part 36.10(2)(a). If it does not, then pursuant to Part 36.10(1) the claimant is automatically entitled to the costs of the proceedings up to the date on which notice of acceptance was served on the offeror. If it does, then pursuant to Part 36.10(2) if at the time of serving notice of acceptance within the relevant period the claimant abandoned the balance of the claim within the meaning of 36.10(2)(b) she is only entitled to the costs of the proceedings up to the date of serving notice of acceptance if the court does not otherwise order.

[19]Part 36.10 provides, so far as presently material, as follows:

“36.10- (1) subject to paragraph (2)… where a Part 36 offer is accepted within the relevant period the claimant will be entitled to the costs of the proceedings up to the date on which notice of acceptance was served on the offeror. (2) Where – (a) a defendant’s Part 36 offer relates to part only of the claim; and (b) at the time of serving notice of acceptance within the relevant period the claimant abandons the balance of the claim, (c) the claimant will be entitled to the costs of the proceedings up to the date of serving notice of acceptance unless the court orders otherwise.”

[20]The position is thus that where a Part 36 offer is accepted within the relevant period the claimant is entitled to the costs of the proceedings up to the date of notice of acceptance as of right unless(i) a defendant’s Part 36 offer relates to part only of the claim

(ii) at the time of serving notice of acceptance within the relevant period the claimant abandons the balance of the claim.

[21]On behalf of the defendant Mr Browne submitted that it is quite clear, given the injuries and the way the case was pleaded, that the offer made and accepted(a) related to only “part of the claim” and

(b) involved the claimant abandoning “the balance of the claim.” It is immediately apparent from that formulation that the second part of that submission does not directly engage the second condition precedent to the application of Part 36.10(2) and the creation of a discretion in the court as to costs, namely that the abandonment by the claimant of the balance of the claim must occur at the time of serving notice of acceptance of the defendant’s Part 36 offer (as distinct from occurring in the offer itself). By contrast Mr Browne’s submission was that the claimant’s abandonment of the balance of the claim was constituted not or not just by her acceptance of the defendant’s Part 36 order but by the making of the offer as well.

[22]Before considering whether the claimant at the same time as accepting the defendant’s Part 36 offer abandoned “the balance of the claim” it is necessary to consider the logically anterior question whether the Part 36 offer itself related to part only of the claim. If it did not and in fact related to the whole claim, then it must follow that the claimant cannot at the same time as accepting the offer have abandoned the balance of the claim since there would be no balance of the claim to pursue or abandon.

[23]Part 36.2(2) provides as follows:

“A part Part 36 offer must – (a) be in writing; (b) state on its face that it is intended to have the consequences of Part 36; (c) specify a period of not less than 21 days within which the defendant will be liable for the claimant’s costs in accordance with rule 36.10 if the offer is accepted; (d) state whether it relates to the whole of the claim or to part of it or to an issue that arises in it and if so to which part or issue;…”

[24]Part 36.2(5) provides that “an offeror may make a Part 36 offer solely in relation to liability.”

[25]It was not suggested by Mr Browne that the offer described as “Part 36 offer 1” in Ms Dragicevic’s first email dated 3 September 2010 was not an offer to settle made in accordance with rule 36.2. As to 36.2(2)(b), although that email did not on its face state that the offer was intended to have the consequences of Part 36 the email sent later that day in response to Mr Davis’s email pointing out that the second offer was not consistent with the provisions of Part 36 confirmed for the avoidance of doubt that both offers were made pursuant to Part 36 and were intended to have the costs consequences of CPR Part 36. While of course the latter reference begs the question whether the costs consequences of CPR Part 36 are those specified in 36.10(1) or 36.10(2), it is clear that it was accepted by Mr Browne that by reason of the second email dated 3 September 2010 the defendant’s offer satisfied the requirement of 36.2(2)(b).

[26]Nor was it suggested by Mr Browne that the Part 36 offer failed to satisfy the requirement in 36.2(2)(c). Although the second email dated 3 September 2010 did not in terms specify “a period of not less than 21 days within which the defendant will be liable for the claimant’s costs in accordance with rule 36.10 if the offer is accepted”, it did state:

“The offers will remain open for acceptance for 21 days from receipt. The offers are intended to have the costs consequences of CPR Part 36.”

In my judgment Mr Browne was right not to suggest that the requirement of 36.2(2)(c) was not satisfied. In Onay v Brown [2010] 1 Costs LR 29;

[2009] EWCA Civ 775

a defendant’s Part 36 offer included the following:

“This offer is made pursuant to Part 36 of the Civil Procedure Rules and is intended to have the consequences of that rule. The relevant acceptance period is 21 days from the date of receipt of this letter, namely to 26 September 2008.”

Goldring LJ in a judgment with which the other members of the Court of Appeal agreed stated: “The defendant’s letter of 5 September 2008. As was pointed out by my lord, Toulson LJ in the course of argument, the reference to the relevant (my emphasis) acceptance period of 21 days plainly pointed to CPR 36.2. Mr Davis [counsel for the defendant] accepted as much. Any reasonable solicitor reading the letter would in my judgment conclude that the writer’s intention was that Part 36.2(c) was to apply, in other words that if within 21 days the offer was accepted: ‘the defendant will be liable for the claimant’s costs in accordance with rule 36.10.’” (para 27). In my judgment any reasonable solicitor reading Ms Dragicevic’s second email dated 3 September 2010 would conclude that her intention was that Part 36.2(c) was to apply.

[27]Nor did Mr Browne submit that the defendant’s Part 36 offer failed to satisfy the requirement of 36.2(2)(d) by failing to state whether it related to the whole of the claim or to parts of it or to an issue that arose in it and if so to which part or issue. That is not withstanding the fact that unlike in the defendant’s Part 36 offer in the letter dated 5 September 2008 in Onay v Brown, the first Part 36 offer in Ms Dragicevic’s first email dated 3 September 2010 did not in terms state whether it related to the whole of the claim or to part of it or to an issue that arose in it and if so to which part of issue. In Onay v Brown the Part 36 offer letter stated:

“Our client offers to settle the issue of contributory negligence on the basis of a 25% reduction. In other words, if the offer is accepted, your client will receive 75% of his assessed damages.” (paragraph 5.) However it is in my view significant that in that case the Court of Appeal held that as a matter of analysis the defendant’s offer contained in that letter amounted to an offer to settle in relation to liability as a whole and not just the issue of contributory negligence to which in terms it referred. Although in terms couched as an offer to settle the issue of contributory negligence, on the facts of that case that amounted to an offer to settle liability as a whole since judgment had already been entered for the claimant “with damages and the issue of contributory negligence, if any, to be assessed”

. Thus the issue of contributory negligence was the only outstanding issue in relation to liability.

[28]Moreover Goldring LJ went on to hold that it would be inconsistent to regard an offer solely in relation to liability as an offer in respect of part of a claim whether in accordance with Part 36.10(2) or 36.11(3). I will return to Part 36.11(3). He held: “Neither do I accept that the appropriate provision under Part 36.11 was Part 36.11(3) but the offer related to part only of a claim. Part 36.2(5) specifically contemplates that a Part 36 offer may be made solely in relation to liability. That must be intended to relate to a Part 36.2 offer. It would be inconsistent therefore to regard an offer solely in relation to liability as an offer in respect of part of a claim whether in accordance with 36.10(2) or 36.11(3). This letter in my judgment amounted to an offer solely in relation to liability. It fell within 36.2(5) but that the context was contributory negligence does not seem to me to affect that. It therefore seems to me that the letter of 5 September 2008 was, and was objectively intended to be, a Part 36.2 offer, and that the entitlement to costs accordingly arose under 36.10(1).” (Paragraph 28).

[29]In my judgment an objective reading of the first Part 36 offer in the first email of 3 September 2010 leads to the conclusion that it was an offer to settle all outstanding liability issues including in particular the four issues ordered by the Deputy District Judge to be the subject of the first part of the split trial. Those issues included the disputed issue as to which of the injuries sustained by the claimant had been sustained as a result of the defendant’s vehicle running her over as opposed to the claimant jumping out of the Part 20 defendant’s (i.e her husband’s) vehicle. Mr Browne submitted that the offer related solely to the defendant’s disputed liability for the eight injuries detailed in the 3 September 2010 email. He relied on the concluding sentence:

“For the sake of clarity the bilateral scapula and head/facial injuries described at items one to six inclusive under the heading “Head” in respect of Doctor Armour dated 24.05.2010 were sustained as a result of the fall to the road on exiting the moving vehicle and before any subsequent “running over” by the defendant’s vehicle.”

He submitted that this makes it plain that the defendant was maintaining his denial of liability for having caused those injuries and that it follows that the offer related solely to that part of the claimant’s claim which claimed damages flowing from injuries one to eight. I do not accept that submission. In my judgment that sentence was intended to make it clear that the defendant was making no financial offer to compensate the claimant for any consequences following from her head and shoulder injuries. It does not follow from that in my view that the offer as a whole was confined to that part of the claimant’s claim which sought to recover damages in respect of the other injuries and did not extend to compromising that part of her claim which sought to recover damages for the head and shoulder injuries. The fact that the only money on offer was referable to the former injuries does not in my view carry with it the consequence that the offer as a whole was confined to the claim for damages in respect of the former injuries and did not extend tot compromising the claim in respect of the latter injuries.

[30]In my judgment the matter is put beyond argument when regard is had to the terms and effect of Part 36.11(1), (2) and (3). They provide as follows:

“36.11 – (1) If a Part 36 offer is accepted, the claim will be stayed. (2) In the case of acceptance of a Part 36 offer which relates to the whole claim, the stay will be on the terms of the offer (3) If a Part 36 offer which relates to part only of the claim is accepted – (a) the claim will be stayed as to that part upon the terms of the offer; (b) subject to rule 36.10(2), unless the parties have agreed costs, the liability for costs shall be decided by the courts.”

[31]If Mr Browne were right and the offer related to part only of the claim and in particular that part dealing with injuries one to eight, Part 36.11(3)(a) would apply and the claim would be stayed only in relation to the claim in respect of injuries one to eight. It would follow that notwithstanding the claimant’s acceptance of that offer in the email dated 15 September 2010 there would have been no stay in respect of the claimant’s claim for damages to compensate her for the injuries sustained to her head and shoulder. Thus all four of the issue required to be tried at the first stage of the split trial on 5 October 2010, namely liability as between claimant and defendant, (by which in my view was meant whether the claimant was negligent), whether the claimant was guilty of contributory negligence and in particular whether the injuries to her head and shoulder were caused as a result of the defendant’s car running over her as opposed to her jumping out of her husband’s car would all have had to proceed to trial, albeit the latter would have been confined to the injuries to the claimant’s head and shoulder. That in my judgment is plainly not what was intended or contemplated by the defendant’s Part 36 offer and not what would have been understood by any reasonable solicitor reading it. Nor did Mr Browne suggest that that was intended to be the effect of the Part 36 offer. His submission appeared to be that the Part 36 offer related only to the claim in respect of injuries one to eight and that by accepting the offer the claimant was abandoning her claim in respect of the head and shoulder injuries. In my judgment that is an unrealistic submission and would in any event, in order to trigger the provisions of Part 36.10(2) require a finding that the act by the claimant of accepting the defendant’s offer was itself in addition a separate act taken at the same time as accepting the offer, of abandoning the balance of the claim. In my judgment that also is unrealistic. In my view Part 36.10(2)(b) contemplates a separate distinct act of abandonment carried out at the same time as the act of accepting the Part 36 offer. There was in this case no such act by the claimant or her solicitors. In any event in my judgment no such act can be implied by the acceptance by the claimant of the Part 36 offer. By accepting that offer the claimant in my judgment was not accepting an offer to settle the claims in respect of injuries one to six and abandoning the claims in respect of the head and shoulder injuries. Rather she was accepting an offer to settle the whole of her liability claim, leaving only damages to be assessed.

[32]In my view these conclusions are supported by but not dependent on the fact that the defendant’s second Part 36 offer was said to be an offer to settle “the whole of the claimant’s claim in the sum of £10,000 net of CRU” subject to certain conditions. In my view the reference to “the whole of the claimant’s claim” was intended to be a reference to liability as well as quantum and was intended to distinguish the second Part 36 offer from the first Part 36 offer which by inference was intended to be an offer to settle liability only but not quantum. This distinction is reflected in the fact that implicit in the nature of the first Part 36 offer, namely to contribute 30% of the damages and consequential loss arising from injuries one to eight, was the assumption that quantification of the damages and consequential loss arising from those injuries remained to be assessed in the second part of the split trial. Both that assumption and the fact that both parties contemplated that the whole of the claimant’s claim as to liability would be stayed pursuant to the acceptance of the offer is confirmed by the fact that the draft consent order prepared by the claimant’s solicitor contained the following proposed orders, to neither of which the defendant’s solicitor objected:

“3. The trial on liability (as listed between the claimant and defendant) listed to commence on 5 October 2010 (time estimate four days) be vacated. 4. The matter shall be listed for a CMC by telephone on the next available date (time estimate of 20 minutes) to deal with directions in relation to quantum”

[33]Mr Browne submitted that the situation in this case is similar to that in E. Ivor Hughes Educational foundation v Leech

[2005] EWHC 1317 (Ch)

where the claimant had sought damages of over £610,000 but had accepted a payment in of only £5,000. Costs on each side were into six figures and the court ordered the claimant to pay the defendant’s costs of the claim save for that part of the claim that related to the payment in of £5,000. Mr Browne submitted that the acceptance of a far lesser sum can clearly amount to accepting only part of the claim and abandonment of the remainder. In the present case he submitted that it is clear that the claimant accepted causation and limited liability on limited and lesser injuries than those claimed and abandoned liability and causation on the head injury and scapula injuries.

[34]In my judgment it is clear that the decision of Peter Smith J in the Hughes case does not support Mr Browne’s submission and is wholly distinguishable. In that case the claimant made a series of discrete claims against the defendant. The nature of those claims was not spelled out by Peter Smith J’s judgment, but that there were discrete claims appears clearly from it. Under the provisions of Part 36 which were then in force the defendant served a notice of a Part 36 payment into court. It was made clear by Peter Smith J explicitly that the payment was in respect of one issue only namely a claim for false expenses which had been advanced in the sum of £87,000 or £60,000. It was also made plain that on the same date as the claimant accepted the £5,000 much to the defendant’s surprise “not only did it accept the £5,000 in respect of the part of the claim that it was tendered but they also as is its right, simultaneously elected to abandon the entirety of the rest of the claims. It is to be noted, therefore, that it abandoned all the other serious allegations of fraud in respect of amounts which, ignoring the expense claim, came to £610,000 odd and, in respect of the expense claim, which was between £87,000 and £60,000, it decided to take £5,000.” (see paragraphs 6 and 8).

[35]It was on that basis that Peter Smith J held that Part 36.13(2), (the predecessor of Part 36.10(2) was triggered with the effect that there was conferred on the court a discretion as to costs. Part 36.13(2) provided:

“Where a Part 36 offer or a Part 36 payment relates to part only of the claim and, at the time of serving notice of acceptance, the claimant abandons the balance of the claim, the claimant will be entitled to his costs of the proceedings up to the date of serving notice of acceptance unless the court orders otherwise.”

[36]Thus, in contradistinction to the present case, in Hughes the Part 36 payment was tendered “in respect of one issue only” and in a clearly separate act the claimant simultaneously elected to abandon the entirety of the rest of its claims. Thus in my judgment Hughes does not support Mr Browne’s submissions in any way. It was simply a case in which on the particular facts there was a finding that the Part 36 payment had been tendered in respect of one issue only and that simultaneously with the acceptance of that tender the claimant had abandoned the balance of its claims. The abandonment of the balance of the claims was not held to have arisen, as Mr Browne suggested it was, by reason of the mere acceptance of a far lesser sum than that claimed in the action, but by reason of a surprising and thus by definition separate, explicit election on the part of the claimant at the same time as it accepted the sum in respect of the partt of the claim in respect of which it had been tendered.

[37]Finally Mr Browne challenged the submission of Mr Donovan on behalf of the claimant, relying on Onay v Brown, that a Part 36 liability offer is not an offer which relates to “part only of the claim” for the purposes of Part 36.10(2). He joined issue on that submission “where both liability and causation are being contested; this case was listed for a trial on ‘liability and causation’ and the additional factor in a claim of causation is well capable of leading to departure from the normal rule that the claimant obtains all her costs, even if successful on liability.” I did not understand that submission. While it is true that the issues which were ordered by the Deputy District Judge to be tried first included the issues of whether and if so which of the injuries sustained by the claimant had been caused by her being run over by the defendant’s car as distinct from her act of jumping out of her own car, those were among the issues which, as I have found, were the subject matter of the Part 36 offer. Thus in respect of injuries one to eight, which the defendant accepts were compromised by the Part 36 offer, the effect of the offer being accepted was to settle the claimant’s claim that the defendant was liable for the damages and costs flowing from him having caused those injuries. All that remained to be decided by the court at the second stage of the trial was the quantum of those damages and financial consequences. The same applies to the injuries to the claimant’s head and shoulder. There is in my judgment no material distinction between this case and Onay v Brown.

[38]It follows from my conclusions that it is not necessary for me to decide whether the question of costs should be deferred until the end of the quantum trial or, if it should not, how the discretion conferred by Part 36.10(2) should be exercised since it follows that in my judgment I do not have such discretion. Reliance was placed in this regard by Mr Browne on two earlier without prejudice offers made by the defendant to settle the action both of which were rejected by the claimant. One was a Calderbank offer in that it was described as being without prejudice save as to costs. The other was not in that it was merely stated to be without prejudice. As such it would on ordinary principles have remained a privileged document, but for the fact that, as accepted by Mr Donovan, the claimant waived privilege in it by including it in a bundle of documents placed before me. There was a dispute between the parties as to whether, if I had had a discretion pursuant to Part 36.10(2), the making by the defendant of either or both of those without prejudice offers and their rejection by the claimant were matters which could properly be taken into account by the court in the exercise of the discretion conferred by Part 36.10(2), as submitted by the defendant, or whether they were overtaken by the making and acceptance of the 3 September 2010 Part 36 offer, as submitted by Mr Donovan. For the reasons already given it is not necessary for me to decide that question or indeed to resolve any of the other issues arising out of the competing contentions made by the parties as to when and how the Part 36.10(2) discretion should be exercised.

Conclusion

[39]For the reasons set out above in my judgment the claimant is entitled to the costs of the proceedings up to 15 September 2010 being the date on which notice of acceptance of the defendant’s Part 36 offer was served on the defendant pursuant to CPR Part 36.10(1).