Sanctions against a defendant who ignores a letter before claim (PD Pre-Action Conduct, para 16)
Amira Haddad, a sole trader, supplied bespoke shop fittings to Brightwater Interiors Ltd, which has not paid the £150,000 price. No pre-action protocol applies. In January 2026 Amira's solicitors sent Brightwater a detailed letter before claim complying with the Practice Direction - Pre-Action Conduct and enclosing key documents. Brightwater did not reply at all. Amira issued proceedings in May 2026. Brightwater defended the claim, but Amira was awarded £150,000 after a multi-track trial. The judge finds that Brightwater's failure to respond was unreasonable non-compliance with the Practice Direction.
Which of the following orders may the court make because of Brightwater's non-compliance?
Choose one answer to see the reasoning.
Worked answer
Correct answer A: An order awarding Amira interest on the £150,000 for a specified period at an enhanced rate, not exceeding 10% above base rate.
THE RULE TO REMEMBER
For pre-action non-compliance the court may order costs (including indemnity costs) and adjust interest; a defaulting defendant may pay enhanced interest of up to 10% above base rate.
Sanctions against a defendant who ignores a letter before claim (PD Pre-Action Conduct, para 16)
Paragraph 6(b) of the Practice Direction - Pre-Action Conduct expects a defendant to respond to a letter before claim within a reasonable time, which is 14 days in a straightforward case and no more than three months in a very complex one. Brightwater did not respond at all. Under para 13 the court takes non-compliance into account when making costs orders, and para 16 lists the sanctions the court may impose. These include an order that the party at fault pays costs, an order that it pays costs on the indemnity basis, and, where the party at fault is a defendant and the claimant has been awarded a sum of money, an order awarding interest on that sum for a specified period at a higher rate, not exceeding 10% above base rate, than would otherwise have been awarded (para 16(d)). Option A therefore describes an order open to the court.
Why B is wrong: Depriving a party of interest is a sanction for a claimant at fault (para 16(c)), not one used against the innocent claimant.
Why C is wrong: An additional amount of 10% is a Part 36 consequence under CPR 36.17(4)(d), not a pre-action conduct sanction.
Why D is wrong: Enhanced interest under para 16(d) is capped at 10% above base rate and is awarded for a specified period.
Why E is wrong: The court may impose sanctions, including costs and interest orders, when it decides the case, not only by staying proceedings.
A little more practice done.
Related questions
Failure to file a costs budget on time (CPR 3.13 and 3.14)
Unless the court otherwise orders, what is the consequence for Dunmore?
Claimant fails to beat a defendant's Part 36 offer: costs consequences (CPR 36.17(1)(a) and (3))
Which of the following best describes the order the court must make, unless it considers it unjust to do so?
Court's power to order ADR and costs consequences of refusing to engage (CPR 3.1(2)(o), 44.2(5)(e))
Which of the following best describes the position?
A GOOD HABIT, DELIVERED
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