Negotiating a Settlement as the Defendant Before a County Court Hearing
Filing a defence does not mean you have to go to a hearing. Many defendants discover that the smartest move, after responding to the claim and understanding it properly, is to negotiate a settlement on terms they can live with.
When settling makes sense
Settlement is not the same as giving up. A defendant settles when the cost and stress of fighting the claim outweigh the benefit of winning — or when the claim has some merit but the amount is wrong.
Situations where defendants commonly settle:
- You owe some of the money but not all of it. The claimant is claiming £4,500 and you believe you owe £2,800. Settling at £3,000 closes the case faster and cheaper than a hearing.
- The evidence is uncertain. You have a defence, but the documents are incomplete, a key witness has moved abroad, or the facts could go either way. A judge might find for you or might not.
- The claim is small and the hearing costs are disproportionate. Taking a day off work, travelling to court, and the stress of a hearing for a £1,200 dispute may not be worth it, even if you would probably win.
- You want to avoid a CCJ. A CCJ can stay on the Register for six years, affecting your credit record; paying it in full within one calendar month lets you apply to have it removed. A settlement that avoids judgment entirely avoids a registered CCJ.
How to make an offer
Contact the claimant (or their solicitor) directly — by letter, email, or through the OCMC portal if the claim was filed online. Set out your offer clearly:
- The amount you are offering
- Whether it is a full and final settlement (meaning the claimant drops the claim entirely in exchange for your payment)
- The payment terms (lump sum, or instalments over a specified period)
- A deadline for accepting the offer
Write "without prejudice" at the top of the letter. A genuine without-prejudice offer is generally kept from the judge when deciding liability, though it may be relevant to costs or whether a settlement was reached. The judge decides liability on the evidence.
If you want the protection of a formal Part 36 offer (CPR Part 36), it must comply with specific requirements: it must be in writing, state it is a Part 36 offer, give a relevant period of at least 21 days for acceptance, and state whether it relates to the whole claim or part of it. Part 36 does not apply to claims allocated to the small claims track.
Recording the agreement
If the claimant accepts your offer, record the agreement properly. There are three ways to close the case:
Notice of Discontinuance (Form N279): the claimant discontinues the claim. This is the cleanest outcome for you — no judgment, no CCJ. The claimant files the notice with the court and serves a copy on you. The usual rule is that the claimant pays your costs up to discontinuance; on the small claims track, recoverable costs are limited to the categories in CPR 27.14, including court fees and, where allowed, reasonable witness travel and loss of earnings.
Consent order: both parties agree a draft order setting out the settlement terms, and the court seals it. This creates a court order, but is not automatically a CCJ. If it includes a judgment for a sum, the usual CCJ registration rules apply; if either side breaches it, the other may enforce the order or take the steps its terms provide. Use this when you need structured payment terms.
Tomlin order: a consent order where the substantive settlement terms are set out in a confidential schedule rather than in the order itself. The order stays the claim on terms that the parties have agreed. If either side defaults, the non-defaulting party applies to enforce the schedule. Tomlin orders are common in commercial disputes and cases where the parties want to keep settlement figures private.
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When the claimant will not negotiate
Some claimants refuse all offers, particularly if they believe they have a strong case or if a solicitor is advising them to pursue the full amount. If settlement fails, continue preparing for the hearing. File your evidence bundle on time, attend the HMCTS telephone mediation if your claim is referred under PD 51ZE (the session can last up to one hour), and be ready to present your case to the judge.
Even at the hearing, settlement remains an option. Judges routinely ask both parties at the start whether any further settlement discussions have taken place. Cases settle on the day of the hearing, in the corridor, more often than people expect.
The county court money claim response guide covers the full range of defendant options — from filing a defence through negotiating a settlement to preparing for a hearing — with decision frameworks to help you work out which route makes the most financial sense.
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