Key Takeaways
- A Calderbank offer is a formal, written settlement offer in UK law that influences which party pays legal costs if settlement discussions fail.
- The meaning of a Calderbank offer centres on “without prejudice save as to costs”—the offer remains confidential until costs are decided, then may be disclosed to the court.
- Essential elements include the settlement amount, a deadline, and clear wording that the letter may be referred to for costs purposes.
- Poorly constructed or misunderstood Calderbank offers create risk: you could lose settlement leverage and end up with significant legal costs.
- Calderbank and Part 36 offers differ under UK law; knowing which is appropriate improves your strategy in any dispute.
- Ignoring or unreasonably rejecting a Calderbank offer can result in the recipient being ordered to pay extra legal costs.
- Using a lawyer-approved template and ensuring all key clauses are present helps your offer stand up to legal scrutiny and protect your interests.
- Our platform provides step-by-step tools and expert-reviewed templates, making it easy to draft or respond to Calderbank offers with confidence.
- Go-Legal AI is rated Excellent on Trustpilot with over 170 five-star reviews from satisfied users.
What Is a Calderbank Offer in UK Law?
Negotiating a settlement in the midst of a business dispute can be daunting, especially when court costs hang in the balance. A Calderbank offer is a powerful tool that helps you settle disputes while protecting your rights—provided you understand and use it correctly.
A Calderbank offer is a written proposal marked “without prejudice save as to costs.” In practice, this means that your offer isn’t revealed to the judge determining your main case, but it can be shown to the court when it’s time to discuss who pays legal costs if a settlement isn’t reached.
Getting the wording and timing right is essential. A well-crafted Calderbank offer can protect your cash flow, minimise risk, and influence costs orders after litigation.
The Calderbank Offer Meaning Explained
A Calderbank offer is a settlement proposal that carries unique legal weight because of its label: “without prejudice save as to costs.” In England and Wales, this phrase means your offer will remain private during the trial, but can be disclosed after judgment for costs purposes.
This protection incentivises parties to negotiate in good faith. If a reasonable Calderbank offer is refused and the rejecting party later secures a less favourable outcome at trial, the court can penalise that party by ordering them to pay additional legal costs.
How Does a Calderbank Offer Work in Settlement Negotiations?
Calderbank offers are used in civil, commercial, and employment disputes across England & Wales. Here’s how they work step-by-step:
- You send the other side a formal written offer, marked “without prejudice save as to costs.”
- The recipient reviews your offer and can accept, reject, or negotiate further.
- If there’s no agreement and the dispute goes to court, your offer is only revealed after the judge reaches a decision on the main issues—specifically, when deciding costs.
- If you achieve an equal or better result at trial than what you offered, the court can make a favourable costs order for you, often requiring the other party to pay your legal fees from the offer date.
For businesses and individuals alike, this can significantly shift the financial risk in litigation.
Calderbank v Calderbank: The Legal Origin
The term “Calderbank offer” stems from the 1976 family law case, Calderbank v Calderbank. In this landmark decision, the court decided that genuine settlement offers should be taken into account when awarding legal costs—even if the offers were made “without prejudice.”
Before this ruling, such communications were normally seen as entirely confidential. The Calderbank judgment ensured that parties who try to end disputes sensibly are rewarded in the final costs order. The principle is now standard in all English civil proceedings, including commercial litigation, employment disputes, and contract claims.
Essential Clauses for Every Calderbank Offer Letter
Crafting a robust Calderbank offer is about precision. The following clauses are essential:
| Clause/Component | What It Means | Why It’s Important |
|---|---|---|
| “Without prejudice save as to costs” | Offer remains confidential except for court costs purposes | Ensures it can affect costs even if not accepted |
| Settlement Amount & Key Terms | The sum and any conditions attached to the settlement | Removes ambiguity and strengthens your position |
| Response Deadline | Date by which offer must be accepted | Applies pressure and protects you from delay |
| Right to Refer for Costs Decision | Clear statement the offer may be shown to the court on costs | Signals intent and legal basis for disclosure |
| Signature & Date | Confirmation of authenticity and timing | Prevents later disputes about validity |
How to Draft and Send a Calderbank Offer: Step-by-Step
A strong Calderbank offer follows a simple but precise pattern:
- Headline: Clearly mark your letter or email as a “Calderbank offer” and endorse it “without prejudice save as to costs.”
- Offer Details: State exactly how much you’re willing to pay or accept, plus any critical conditions (such as payment schedule or confidentiality).
- Set a Deadline: Specify a realistic timeframe to accept (commonly between 7 and 21 days).
- Reference on Costs: Make it clear that, if rejected, you will refer the letter to the court for costs determination.
- Authenticate: Sign and date the letter, including your role if acting for a company.
- Delivery: Send your letter by email (requesting a read receipt) or by recorded post, and keep evidence of delivery.
⚡ Get legal tasks done quickly
Create documents, follow step-by-step guides, and get instant support — all in one simple platform.
🧠 AI legal copilot
📄 5000+ templates
🔒 GDPR-compliant & secure
🏅 Backed by Innovate UK & Oxford
Calderbank Offer vs. Part 36 Offer: Key Differences
Understanding whether to use a Calderbank or Part 36 offer can impact your negotiation leverage and legal costs exposure.
- Calderbank offers are not governed by strict Civil Procedure Rules, instead following common law principles. Their content and format are flexible, making them ideal for arbitrations, tribunals, or commercial disputes outside formal court rules.
- Part 36 offers are governed by Part 36 of the Civil Procedure Rules, with specific wording and timelines. Accepting or beating a Part 36 offer at trial leads to automatic, more predictable cost consequences for both parties.
This difference is crucial. Choosing the wrong format can limit your ability to influence costs or even render your offer invalid for negotiation leverage.
| Feature | Calderbank Offer | Part 36 Offer |
|---|---|---|
| Governing Rules | Common law (Calderbank v Calderbank) | Civil Procedure Rules, Part 36 |
| Format Flexibility | High (set your own structure and terms) | Strict format and requirements |
| Use Outside Court | Yes (arbitration, employment tribunals) | Only in CPR-governed civil court proceedings |
| Costs Consequences | At court’s discretion | Automatic and rule-based |
| Withdraw or Amend | Freely, at any time before acceptance | Only as the rules permit |
| “WP save as to costs” Wording | Yes | No (format is standardised by rule) |
| Typical Use | Bespoke disputes, pre-action negotiation | County Court and High Court cases |
What Happens After You Make a Calderbank Offer?
After a Calderbank offer is made, several outcomes are possible:
- Offer Accepted: Settlement concludes on the terms you set, avoiding further dispute and added costs.
- Offer Rejected or Ignored: If you “beat” the offer’s value at trial, the court may penalise the other side by awarding you costs from the offer date.
Courts weigh factors such as reasonableness of the offer, clarity, and timing. Proper use increases your leverage and may shift significant litigation costs onto the opposing party.
How to Respond to, Withdraw, or Amend a Calderbank Offer
If you receive a Calderbank offer:
- Accept: Respond in writing and confirm agreement before the deadline.
- Reject or Counter: You may propose alternative terms, but be aware that rejecting a reasonable offer could work against you when costs are decided later.
- Do Nothing: Silence may be treated as a rejection; if you fail to achieve a better outcome at trial, adverse cost orders can follow.
As the sender, you retain the ability to withdraw or revise the offer before acceptance. All changes should be in writing, with clear reference to the original offer and updated terms.
Common Mistakes to Avoid with Calderbank Offers
Mistakes in your Calderbank offer can render it useless or even expose you to greater costs risk. Avoid these pitfalls:
- Not marking the letter as “without prejudice save as to costs.”
- Using vague or unclear language about amount, terms, or deadlines.
- Making or accepting offers verbally—lacking written evidence for court.
- Failing to notify that the offer may be disclosed for costs purposes.
- Overlooking the deadline or forgetting to sign and date the document.
Practical Scenario: Calderbank Offers in Action
How Our Platform Simplifies Calderbank Offers and UK Settlement Letters
Handling dispute resolution efficiently is vital in business. Our platform gives entrepreneurs, freelancers, and founders the advantage, by providing:
- AI-powered drafting tools: Produce clear, effective Calderbank offers and settlement letters in minutes, no jargon required.
- Lawyer-approved templates: Use fill-in-the-blank documents designed specifically for England & Wales, so nothing critical is left out.
- Automated contract reviews: Instantly scan your draft for risky clauses, missing deadlines, or unclear terms—protecting your legal position every time.
- On-demand legal expertise: Chat with one of our UK legal consultants for extra assurance before you send or respond to a settlement offer.
Struggling to draft an effective offer? Run an instant review with our contract analysis tool to highlight risks and ensure compliance before your letter goes out.
Frequently Asked Questions
Is a Calderbank offer legally binding in England and Wales?
Yes—if the offer is accepted exactly as written, it forms a binding contract. If rejected, there’s no legal settlement, but the offer may shape the final court ruling on costs.
What if the other side ignores or rejects my Calderbank offer?
If the offer is reasonable and you later achieve an equal or better result in court, the judge may order the other side to pay some or all of your legal costs from the date the offer was available to them.
How do I prove I made a Calderbank offer correctly?
Keep signed, dated copies and proof of delivery, such as a read receipt or postal confirmation. Always set out your terms and intentions in writing.
Should I use a Calderbank offer or a Part 36 offer?
Use Calderbank offers where the dispute is outside formal court proceedings or you require flexibility. Part 36 is best for county or high court litigation.
Do I need a lawyer to make a Calderbank offer?
No—using our smart template builder, most business owners and freelancers can draft their own compliant offer. For complex disputes, our on-demand legal consultants can review your draft to maximise its strength.
Can I withdraw or update my Calderbank offer?
Yes, until it’s been accepted. Withdraw or revise your offer by sending a new, clearly worded letter or email and retain proof.
How does a Calderbank offer impact my legal costs?
A well-worded and reasonable Calderbank offer increases your chances of being awarded your costs if litigation follows and you get an outcome at least as good as proposed in your offer.
What does “without prejudice save as to costs” mean?
This phrase keeps the offer confidential during proceedings, but enables the court to see it after trial solely for decisions about legal costs.
When can I use a Calderbank offer—are they just for court cases?
Calderbank offers are used in arbitrations, employment disputes, commercial contract negotiations, and any scenario where civil settlement is possible.
What could go wrong with a badly drafted Calderbank offer?
A vague or incorrectly labelled offer might not influence the court’s decision on costs, and could worsen your risks. Our templates and smart review tool help you avoid all common errors.
Send a Compliant Calderbank Offer with Confidence
Drafting a Calderbank offer isn’t just a formality—it can be the difference between expensive litigation and a swift, cost-effective settlement. A well-prepared letter influences the court’s approach to legal costs and signals that you’re acting fairly and professionally. Miss a key clause, and you risk losing this tactical advantage, potentially paying out far more than you should.
With our platform, any UK business owner or freelancer can prepare and send a Calderbank offer that ticks every legal box. Use expert-reviewed templates, step-by-step automation, and instant compliance checks—no legal background required.
Ready to settle your dispute on your terms? Start a free trial to create and review your custom Calderbank offer in just minutes.
⚡ Get legal tasks done quickly
Create documents, follow step-by-step guides, and get instant support — all in one simple platform.
🧠 AI legal copilot
📄 5000+ templates
🔒 GDPR-compliant & secure
🏅 Backed by Innovate UK & Oxford
Access to legal templates (3 downloads/month)
