Settlement offer to defendant

[MrNumbskull]

I believe this deserves its own thread as it's a discrete legal topic, although is related to another thread I have. Short version:

 

I started action against a garage over a car repair.

The garage filed a defence.

We had a mediation meeting where they offered ~25% of the claim to settle.

I rejected that offer and decided to end the mediation as it was clear our positions were (financially speaking) too far apart.

 

 

Obviously the content of the mediation is confidential so I cannot refer to it at the hearing.

Their offer was made 'without prejudice' but did not mention Part 36.

 

Due to a change in circumstance I have decided to accept their offer.

I wrote to them and said I will settle for £xxx (which is the same as their mediation offer) plus my £60 cost of the action,

though I did not mention in the letter the fact that they had offered this amount in mediation.

 

The letter I sent was NOT marked 'without prejudice' simply because I want to be able to show this at the hearing that I have offered to settle for significantly less than the claim (though I can't mention that they had already offered this?).

 

The rough outline of the letter was that after further consideration I am prepared to settle for £xx.

This settlement offer does not imply a strength or weakness in either parties' case.

This settlement will be full and final, and neither party will be able to pursue the other for costs etc etc.

 

I'm aware of the overriding preference to settle before a hearing if possible and as they've already offered this amount,

I see this as reasonable.

 

 

It's a little too late because it's done, but can anyone see a problem with this (letter)?

[BankFodder]

If you really feel that it is in your interests to settle in this way then I don't see anything wrong with the letter. I haven't read through the entirety of your thread but I think it is concerned with a clutch and other problems that you have experience with a vehicle which you bought.

 

I have to say that mediation usually doesn't work. It's not really suitable for small claims and mediators often encourage people to settle for far less than they are entitled to simply to get it out of the way. Many people see mediation as a way of getting a litigant in person to compromise on their rights.

 

I would very rarely recommend mediation to anybody.

 

You refer to part 36. Does this mean that the claim is more than the small claims limit? Part 36 offer is only refer to claims which are not allocated to the small claims track.

 

Have you sent the letter off yet? Even if you do send it off, you can withdraw the offer at any time before it is accepted as long as you make your withdrawal known to the other side in writing.

 

I'm not entirely sure what you're asking really. Are you asking whether we think it's a good idea to settle for 25% your claim? This is a matter for you to decide. If you are sufficiently convinced of the rights of the matter to issue a claim then 25% seems like a huge climbdown

[MrNumbskull]

Thank you for the swift reply BankFodder. The real question is whether I had committed a legal blunder by not formatting the letter correctly, or not including certain terms. The claim is about the clutch and associated fault.

 

Because the garage have refused to fix the issue and it's dragged on so long, I found it unbearable to live with the vehicle and so have traded it in. The idea (upon a successful claim) was to have the work done elsewhere and return the faulty parts to the garage.

 

Now I have got rid of the vehicle, I won't be doing this, but can I demonstrate a loss to the court? I intended to sell it privately as it's had a lot of expensive work done and parts replaced. This would be a good selling point for a private sale and got me more money for it (but made NO difference to the trade-in price I got), but I couldn't sell it privately with a clear conscience knowing it potentially had that fault.

 

This issue became the sole reason I sold the vehicle. I even spent £1500 on it back in April this year replacing something that wasn't broken or faulty to futureproof a weak point as I intended to keep it.

 

Life is busy, it's not something I've got time to pursue (now I don't have to). I didn't put a time limit on the offer, but I did ask for a response within seven days, and this was nearly two weeks ago. I've heard nothing.

[BazzaS]

I believe this deserves its own thread as it's a discrete legal topic, although is related to another thread I have. Short version:

 

I started action against a garage over a car repair. The garage filed a defense. We had a mediation meeting where they offered ~25% of the claim to settle. I rejected that offer and decided to end the mediation as it was clear our positions were (financially speaking) too far apart. Obviously the content of the mediation is confidential so I cannot refer to it at the hearing. Their offer was made 'without prejudice' but did not mention Part 36.

 

Due to a change in circumstance I have decided to accept their offer. I wrote to them and said I will settle for £xxx (which is the same as their mediation offer) plus my £60 cost of the action, though I did not mention in the letter the fact that they had offered this amount in mediation.

 

The letter I sent was NOT marked 'without prejudice' simply because I want to be able to show this at the hearing that I have offered to settle for significantly less than the claim (though I can't mention that they had already offered this?).

 

The rough outline of the letter was that after further consideration I am prepared to settle for £xx. This settlement offer does not imply a strength or weakness in either parties' case. This settlement will be full and final, and neither party will be able to pursue the other for costs etc etc.

 

I'm aware of the overriding preference to settle before a hearing if possible and as they've already offered this amount, I see this as reasonable. It's a little too late because it's done, but can anyone see a problem with this (letter)?

 

Problems:

1) It is disclosable in court, before judgment is reached.

Had it been marked "without prejudice save as to costs", it wouldn't have been able to be seen by the judge until judgment, and then it would be relevant to any costs decision (and this is the stage where you might want to be able to show you have been reasonable and tried to settle).

 

. I didn't put a time limit on the offer, but I did ask for a response within seven days, and this was nearly two weeks ago. I've heard nothing.

 

2) As it is for more than their offer (if the £60 costs wasn't included in their offer), it isn't accepting their offer, just making a counter-offer, which they are free to ignore.

They don't have to acknowledge it / reply.

[MrNumbskull]

Problems:

1) It is disclosable in court, before judgment is reached.

Had it been marked "without prejudice save as to costs", it wouldn't have been able to be seen by the judge until judgment, and then it would be relevant to any costs decision (and this is the stage where you might want to be able to show you have been reasonable and tried to settle).

Why is it a problem that it can be disclosed before judgement? It shows that I'm the only party attempting to avoid the increased costs of a hearing.

 

In contrast, the defendant has been very unreasonable in a number of ways in which they have behaved, which I intend to show in the chronology of my witness statement in terms of action they have / have not taken leading up to the claim.

[BankFodder]

I don't see why it should be any problem disclosing the offer to the judge. Frankly, without prejudice is use willy-nilly all over the place and half the legal profession have no idea what it means or why they are using it.

 

The important thing here is that you made, what sounds to me, like a very generous offer. You gave them seven days. 14 days later your offer has not been accepted. Your offer terminated after the seven days and is no longer available to be accepted. If they now want to write to you and accept, it is up to you to say yes or no. In essence, the roles are reversed and if they write a letter of acceptance to you – that amounts to another offer and then it is for you to accept. It's all a bit of a rigmarole.

 

If you are sure of your case, then why don't you just go ahead with it and go to court and see what the judge is prepared to say? If you put together a well thought out case then you should have some measure of success. If you can show the judge that you have been obliged to get rid of the vehicle and disadvantages price as a result of the impact on its value caused by the negligence or breach of contract of the defendants, then the judge may well award you the difference in price – plus all of the costs of your action.

 

If you feel like doing this, then for the avoidance of doubt I would send the other side a letter pointing out that they haven't accepted your offer within the seven days and say you are confirming that the offer is no longer on the table.

[BazzaS]

Why is it a problem that it can be disclosed before judgement? It shows that I'm the only party attempting to avoid the increased costs of a hearing.

 

In contrast, the defendant has been very unreasonable in a number of ways in which they have behaved, which I intend to show in the chronology of my witness statement in terms of action they have / have not taken leading up to the claim.

 

Because if the claim does now go to trial, you have effectively agreed that the claim has become (at most) for the amount they have offered (+ £60 court fee).....

that is why "without prejudice, save as to costs" is used (and had you used that, it wouldn't have had any adverse effect.....

 

As for the defendant being unreasonable, don't forget that you can't mention their behaviour during mediation, or any 'without prejudice' correspondence.

 

The court isn't interested in "who has / hasn't been reasonable" in reaching a judgment, the judgment is based on the facts found, and the law applied to those facts.

 

Once the judgement has been reached, THEN the court looks at the behaviour of the parties, when looking at who pays what costs.

So, there is no downside of making the correspondence "without prejudice save as to costs", but there is a potential downside of not marking it so.

[BankFodder]

Because if the claim does now go to trial, you have effectively agreed that the claim has become (at most) for the amount they have offered (+ £60 court fee).....

that is why "without prejudice, save as to costs" is used (and had you used that, it wouldn't have had any adverse effect.....

 

 

Sorry but I completely disagree that this is the effect of making non-without prejudice offers.

[MrNumbskull]

Sorry but I completely disagree that this is the effect of making non-without prejudice offers.

I think the same. We are now in a situation where if I am awarded greater than I have offered to settle for, the judge would be able to say that the defendant could have saved us all time and money by accepting my offer.

[BankFodder]

Yes, I'm sure that's right. Although part 36 offers don't apply to small claims, it might have the same effect. If the judge awarded you less than you originally asked defendant then objected to having to pay costs as well, I would expect that the judge would favour you over the defendant

[BazzaS]

Yes, I'm sure that's right. Although part 36 offers don't apply to small claims, it might have the same effect. If the judge awarded you less than you originally asked defendant then objected to having to pay costs as well, I would expect that the judge would favour you over the defendant

 

Correct that part 36 doesn't apply to the small claims track, but it wasn't a part 36 offer, it was a Calderbank offer (part 44).

Part 36 is one of the rules excluded for small claims by CPR 27.2(1)(g).

 

Part 44 isn't excluded by 27.2(1), so remains applicable to the small claims track.

 

Interestingly, the court can choose to infer that a communication was made "without prejudice, save as to costs" (that doesn't mean it has to, merely that it can!)

Rush & Tompkins v Greater London Council and others [1988] UKHL 7

http://www.bailii.org/uk/cases/UKHL/1988/7.html

As for:

Frankly, without prejudice is use willy-nilly all over the place and half the legal profession have no idea what it means or why they are using it.

 

Perhaps they are influenced by Griffiths LJ, who noted in Rush & Tompkins v GLC, at 1299

A competent solicitor will always head any negotiating correspondence "without prejudice" to make clear beyond doubt that in the event of the negotiations being unsuccessful they are not to be referred to at the subsequent trial.

 

So, they are concerned that they won't be seen as a competent solicitor if they don't follow his advice ........