Is litigation becoming more elitist?

Year Published: 2015

The reason I ask the question is because, from April 2015, the court fees payable to start litigation are set to sky rocket. The changes will affect all monetary claims over the small claims track limit (£10,000) meaning that it will cost anyone commencing court action, with the help of a solicitor or not, more to bring their claim.

The cost of issuing a claim over £10,000, as with all court fees, at present fall into brackets against which the appropriate court fee is charged. For example, any claim of between £150,000 and £200,000 would attract the current fee of £1,315. If you wait to issue a £200,000 claim until after the changes come into effect, that fee will be £10,000.

The changes mean that for any claim of between £10,000 and £200,000, the fee charged will be the equivalent of 5% of the total value of your claim. As such, a £150,000 claim would attract a court fee of £7,500 and a claim of £200,000 a fee of £10,000 rather than the flat fee mentioned above.

In addition to commencement fees, the fees for applications, filing settlement agreements and commencing possession claims against tenants are all set to increase too, although by smaller margins.

Once you get over the shock of the huge raises in fees being charged, which the Ministry of Justice indicates will effect less than 10% of claims commenced, the new system is inherently fairer to litigators as the costs to issue are in direct correlation to the value of the claim. However, does it promote the underlying rule of Access to Justice promoted by the English and Welsh legal system? I have my reservations. You will need to have a substantial bank balance, or a willing funder, to commence the litigation before you even look at the costs of continuing litigation and the adverse costs risks involved. It will undoubtedly result in a situation where those with good claims but limited funds will be put off or even priced out of taking further action. This cannot promote Access to Justice and this is a view that the President of the national Law Society, Andrew Caplen, shares. The national Law Society are urging members to mobilise against the changes.

The fees for commencing claims below £10,000 remain untouched and within the current “brackets”. Fees for claims of more than £200,000 will be capped at £10,000.

So, will this mean less litigation and more mediation or alternative methods of dispute resolution? Most likely.

Will this mean a sudden surge to issue proceedings before the price hikes? Most probably.

Will the changes have an impact upon the future of litigation? Most certainly.

My advice is speak to a litigator about your case today and do not rest on your laurels, if you are thinking of issuing a claim – lets get moving now!

For further advice on making a claim or any other dispute resolution matters, please contact our Dispute Resolution team on 0161 475 7676.

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