Jones v Associated Newspapers Limited
Reference:  EWHC 1489 (QB);  1 AllER 240;  EMLR 6
Court: Queen's Bench Division
Judge: Eady J
Date of judgment: 25 Jun 2007
Summary: Libel - Costs - Claimant's Part 36 offer - CPR 36.14 - CFAs
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Instructing Solicitors: Carter-Ruck for the Claimant; Foot Anstey for the Defendant.
The Claimant sued in defamation in regard to an article in the Mail on Sunday entitled “Labour MP in foul-mouthed outburst at police guard”. It alleged that he had twice told a House of Commons security guard to “Fuck Off” and had bawled and shouted at him when requested to show his security pass and had refused to show the pass at all. In July 2006 the Claimant made a Part 36 offer to settle his claim in return for damages of £4,999, an apology and an undertaking not to repeat the words complained of. The Defendant did not accede to this offer and mounted a justification defence through to trial. On 14 June 2007 a jury found in the Claimant’s favour and awarded him £5,000 in damages.
The Claimant contended that the jury verdict in his favour meant that he had beaten his Part 36 offer and therefore that, further to CPR 36.14, he ought to have his costs incurred since the offer had expired assessed on the indemnity basis and that he ought to receive interest on those costs at the base rate plus 4%.
(1) That the Claimant had not beaten his Part 36 offer. Whilst he had achieved a greater financial amount, in the round he had not secured more from the jury verdict than he would have achieved if his Part 36 offer had been accepted. Whereas the apology sought had been complete (“no truth at all in the allegation”), at trial the Claimant had admitted that he had been rude to the security guard (although considerably less so than as alleged in the article). (2) The judge indicated that even if the Part 36 offer had been beaten by the Claimant, whilst he would have awarded costs to be assessed on the indemnity basis, he would not have awarded enhanced interest on those costs. This was because: the Claimant had been funded by a CFA and therefore had not personally been out of pocket from funding his litigation costs; if awarded the interest would have been paid to his lawyers who were to receive a 100% success fee in any event; and because of the particular circumstances of this case.
This decision makes it clear that it will not be enough for a claimant to beat a part 36 offer made by him simply by achieving a higher award of damages than offered by way of settlement. The court will scrutinise all the terms of a part 36 offer. Perhaps even more importantly, whilst the judgment makes it clear that interest would not have been awarded merely because the Claimant had been funded by a CFA, the fact that the Claimant had been funded by a CFA was one of the reasons for rejecting, in the circumstances of this particular case, the Claimant’s application for enhanced interest.