If the defendant makes a Part 36 offer and the claimant ignores it, and the claimant obtains a judgment, what is the usual order on costs?

• A. The claimant pays indemnity costs
• B. The costs are capped
• C. The claimant pays the defendant's costs from the end of the relevant period
• D. The claimant pays the defendant's costs until Day 22

Answer: (C)

Part 36 offers create automatic costs consequences to encourage settlement. The relevant period is the time given to accept the offer (normally 21 days). If the claimant ignores the offer and goes on to obtain a judgment that is not more favorable than the offer, the usual outcome is that the claimant must pay the defendant’s costs incurred after the end of that relevant period, on the standard basis. This reflects the sanction for not beating a reasonable offer.

So, the claimant pays the defendant’s costs from the end of the relevant period onward. The day after the offer expires (roughly day 22) marks the start of those costs, not a fixed limit like “until Day 22.” The other options don’t match the standard Part 36 sanction: indemnity costs aren’t the usual outcome in this scenario, costs aren’t simply capped, and “until Day 22” misstates when the costs obligation begins.