The High Court has ruled that a formal settlement offer made under section 17 of the Civil Liability and Courts Act 2004 cannot be accepted unilaterally after it has been lodged in court. The court also held that an offer may be withdrawn at any time, although the reasonableness of the parties’ conduct may be considered when costs are decided.
Mr Justice Gilligan delivered the judgment on May 3, 2012, in a case between Amy Lackey and Patrick Kavanagh. The judgment addresses how section 17 operates; it does not record a decision on the underlying personal injury claim or make a costs order.
Section 17 requires parties in personal injury actions to serve formal offers after the prescribed date. In High Court and Circuit Court proceedings, the prescribed period ends 14 days after service of the notice of trial. Offers are then lodged in court, and their terms are not disclosed to the trial judge until after judgment, when costs are considered.
The judge said the legislation does not require a withdrawal to be in writing or to have court approval. In ordinary practice, counsel may communicate a withdrawal to counsel for the other party. But the court may later consider whether the withdrawal, and the conduct around making the offer, was reasonable when deciding costs.
On whether an offer remains open indefinitely, the judgment considered the statutory scheme alongside other settlement mechanisms, including lodgements and tender offers. The judge concluded that allowing a section 17 offer to remain open for acceptance throughout a trial could undermine those mechanisms and conflict with the provision that section 17 operates in addition to, rather than instead of, them.
The ruling therefore treats the prescribed period as a window for acceptance or rejection. Once an unaccepted offer is lodged, its function is in relation to costs; it cannot then be accepted unilaterally, including on the morning of a hearing after the case has been called on and before assignment to a court. The judgment leaves the assessment of conduct and any resulting costs consequences to the court in the relevant proceedings.