Matière Sas (a company incorporated under the laws of France) v ABM Precast Solutions Ltd

Hearing date: 2 July 2025

This judgment was handed down at 10:30am on 31 July 2025 by circulation to the parties or their representatives by e-mail and by release to the National Archives.

Alexander Nissen KC:

Introduction

This judgment concerns the consequential matters arising from the liability judgment handed down on 11 June 2025: [2025] EWHC 1434 (TCC). In very short order, in December 2021 Matière SAS (“Matière”), as claimant, instituted proceedings against ABM Precast Solutions Ltd (“ABM”), as defendant, for a balance owing on unpaid invoices in the total sum of £373,295.06. Those sums were said to be due under the Consortium Agreement. In the Defence and Counterclaim, dated February 2022, that claim for payment was the subject of a partial admission that, subject to set off, £157,241.91 was due. The balance of the claim was not admitted. The claim was also met with a counterclaim for damages for breach of express obligations of good faith owed under both the Consortium Agreement and a subsequent agreement known as the Collaboration Agreement. At that time, the counterclaim was quantified in the order of £4.8m. Later, the quantum was increased by amendment to £18.92m, alternatively £16.62m.

By the time of the trial, ABM had admitted all but £35,000 of the sum claimed by Matière on the invoices. In the event, I found that Matière was entitled to the full sum claimed and gave judgment in the sum of £373,295.06 and interest. I dismissed the counterclaim in its entirety.

On 4 April 2022, that is after service of the Defence and Counterclaim in its original form, Matière issued a Part 36 letter (“the Part 36 Offer”) expressed in the following way:

“…our client is aware that the costs of these proceedings will quickly become disproportionate to the value of their claim (disregarding in its entirety, of course, your client's unmeritorious and entirely speculative counterclaim, which is bound to fail). Our client is therefore amenable to the notion of settling the proceedings if an acceptable compromise can be reached with your client.

In the circumstances, we are instructed to make the following offer of settlement pursuant to Part 36 of the Civil Procedure Rules (the “Offer”).

The Offer is made by our client as claimant in these proceedings. It is therefore intended to have the consequences set out in Section I of CPR Part 36. In particular, your client will be liable for our client's costs up to the date of service of notice of acceptance, if the Offer is accepted within 21 days (the “ relevant period”). No doubt you will advise your client of the cost consequences of not accepting the Offer, either within the relevant period or at all.

Our client is prepared to settle the entire proceedings, including the whole of the claim and your client's counterclaim, for the sum of £350,000 (the “ Settlement Sum”) to be paid to our client in full and in cleared funds within 14 days of acceptance of this Offer. For the avoidance of doubt, the Settlement Sum does not include our client's costs. The amount is inclusive of interest until the relevant period has expired. Thereafter, interest at a rate of 8% p.a. will accrue.”

The letter went on to set out the consequences for which Matière would contend if it obtained a judgment which was equal to or more advantageous than the Part 36 Offer.

There was no response to the letter.

It is common ground that Matière's offer of April 2022 is a valid Claimant's Part 36 offer within the meaning of CPR 36.5 and that Matière achieved a more advantageous result than that which it offered to accept. That is because, whatever interest is awarded (see below), the principal sum for which judgment has been given exceeds, on its own, the amount in the offer.

Also relevant to the chronology is that, on 17 September 2024, that is shortly before trial, ABM issued its own Part 36 offer in which it expressed itself as willing to accept £5m in full and final settlement of the whole proceedings.

Any determination of Matière's entitlement to interest is itself dependent on the effect of the Part 36 Offer, so it is right to consider that question first.

The Part 36 Offer

CPR 36.17(1) applies because the judgment against ABM is at least as advantageous to Matière as it offered to accept. Accordingly, rule 36.17 is engaged.

CPR 36.17(4) is in the following terms:

“(4) Subject to paragraph (7), where paragraph (1)(b) applies, the court must, unless it considers it unjust to do so, order that the claimant is entitled to —

(a) interest on the whole or part of any sum of money (excluding interest) awarded, at a rate not exceeding 10% above base rate for some or all of the period starting with the date on which the relevant period expired;

(b) costs (including any recoverable pre-action costs) on the indemnity basis from the date on which the relevant period expired;

(c) interest on those costs at a rate not exceeding 10% above base rate; and

(d) provided that the case has been decided and there has not been a previous order under this sub-paragraph, an additional amount, which shall not exceed £75,000, calculated by applying the prescribed percentage set out below to an amount which is—

(i) the sum awarded to the claimant by the court; or

(ii) where there is no monetary award, the sum awarded to the claimant by the court in respect of costs:

…

Amount awarded by the court	Prescribed percentage
Up to £500,000	10% of the amount awarded”

CPR 36.17(5) is in the following terms:

“(5) In considering whether it would be unjust to make the orders referred to in paragraphs (3) and (4), the court must take into account all the circumstances of the case including:

(a) the terms of any Part 36 offer;

(b) the stage in the proceedings when any Part 36 offer was made, including in particular how long before the trial started the offer was made;

(c) the information available to the parties at the time when the Part 36 offer was made;

(d) the conduct of the parties with regard to the giving of or refusal to give information for the purposes of enabling the offer to be made or evaluated; and

(e) whether the offer was a genuine attempt to settle the proceedings.”

On behalf of Matière, Mr Lewis KC, who appears with Ms Ziebart, submits that Matière is entitled to all the beneficial consequences flowing from Rule 36.17 from the expiry of the relevant period, that being 25 April 2022. On his case, this includes an entitlement to indemnity costs in respect of the counterclaim from the expiry of the relevant period. That contention was the most significant issue between the parties at the hearing given that the trial process was almost exclusively concerned with the counterclaim and Matière's actual costs exceeded its cost budget by a significant amount (c. £700k).

In essence, Matière's submissions were as follows. Part 36 is a self-contained code. Following CPR 35.17(4), I must order the relief set out in Part 36 unless it would be unjust to do so. The burden is on ABM to demonstrate injustice which is a “formidable obstacle”. In anticipation of the points being argued by ABM, it contended that the Court's findings of fact against Matière in respect of breach of duty of good faith were not sufficient to make a different order. In addition, not all of ABM's allegations of breach were upheld and ABM was, itself, open to criticism. The full consequences of CPR 36.17(4) should be applied both to claim and counterclaim. The offer was a genuine attempt to settle the entire proceedings. ABM had sufficient information to accept the Part 36 Offer.

On behalf of ABM, Mr Lixenberg's principal contention was that, on a proper construction of the Part 36 Offer, it was not a genuine attempt to settle the proceedings, which is a factor which the Court should take into account: see CPR 36.17(5)(e). The overwhelming majority of the costs were incurred in relation to the counterclaim which was distinct in character from the claim. Matière's offer was to settle the whole proceedings including the counterclaim but was not, in that latter respect, a genuine one. As part of that submission, Mr Lixenberg emphasised that the Part 36 Offer described the counterclaim as “unmeritorious and entirely speculative” and “bound to fail”. ABM accepted that a sufficient concession on the value of the claim was made by Matière such that the Part 36 Offer amounted to a genuine offer to settle the claim, and, for that reason, that the 10% uplift on the sum recovered and additional interest should be awarded to Matière.

By way of further submission, ABM contended that the information available to ABM at the time when the offer was made was such that it would be unjust to visit the cost consequences of CPR 36.17(4) on ABM.

ABM also submitted that, in accordance with the principles set out in CPR 44.2, ABM should only be ordered to pay a proportion of Matière's costs. Reliance is placed on CPR 44.2(4)(a) and (5), given the Court's findings as to the extent and severity of Matière's breaches of duty. It is also said that the Court should take account of ABM's success on substantial parts of its case, namely in respect of the contractual issue of scope of duty and on breaches, where Matière...