solving disputes in county courts
Browne Jacobson’s response
4 July 2011
Browne Jacobson has submitted its response to the Government
consultation ‘Solving disputes in the County Courts’. The
consultation aims to "tackle the perceived compensation
culture, restore proportionality in costs for court users… and
propose cheaper, quicker alternative dispute resolution where
appropriate". The consultation deals with many of the
procedural issues proposed by Lord Justice Jackson in his final
report.
The proposals include:
- extension of the existing road traffic accident (RTA) personal
injury claims scheme
- increases to the small claims and fast track limits
- fixed fast track costs
- mandatory pre-action directions
- mandatory mediation
- new restrictions on enforcement, and a streamlined process
- creation of a unified County Court system.
Procedure and costs
We support extension of the existing RTA Personal Injury (PI)
claim scheme to include higher value claims. The scheme has proved
effective as a means of promptly resolving a substantial proportion
of the claims passing through it and at a more proportionate cost
than would otherwise be the case. However, we are concerned that
any extension should be carried out in consultation with Portal Co
to ensure that the online portal which underpins the process is in
a position to handle the increased volume of claims. We favour an
increase to £25,000 in the first instance which would not require
substantive changes to the process. However, we do accept that it
may be appropriate to review stage 2 and stage 3 type B and C costs
as there is more likely to be increased volumes of quantum
evidence. We suggest that Prof Fenns' costs analysis, prepared for
Lord Justice Jackson's review, may be an appropriate starting
point.
We also consider that, with minimal modification, the process
can be made to accommodate employers' liability (EL) claims. These
have many similarities to motor claims, in terms of the existence
of mandatory insurance, the recently introduced Employers'
Liability Tracing Office (ELTO), and mandatory reporting, which
means that in many cases decisions on liability can be taken
promptly. We suggest that this be implemented initially for claims
worth up to £10,000 with the possibility to extend the value range
at a later date. Again, implementation should be in consultation
with Portal Co and other stakeholders.
We do not, as a matter of principle, oppose further extension,
for example to higher value claims or public
liability (PL) claims. Our proposals are intended to achieve
extension of the portal to those areas in which the cost: benefit
ratio is most favourable in the first instance, with the option of
extension to other areas at a later date.
For claims not falling within the portal scheme, the Government
proposes reform to the conventional small claims and fast tracks.
In particular, it is suggested that the small claims track limit
for non PI or housing disrepair claims should be extended. We
support an increase to £5,000 for housing claims and £10,000 for
other non-PI claims. The Government does not consult on extension
of the threshold for PI claims, but in any event the RTA scheme (if
extended) will capture a large number of those claims.
Extension of the fast track limit is also proposed. The limit
currently stands at £25,000. We support an increase to £35,000.
Beyond that level there is frequently a need for bespoke directions
and a one day trial is less likely to be adequate.
The Government also consults on implementation of fixed fast
track trial costs as proposed by Jackson. Fixed costs are an
effective means of providing both certainty and proportionality,
and are an approach we favour. Fixed costs will necessarily vary
according to the type of claim involved and to maximise costs:
benefits we suggest that the focus at the outset should be to
implement these in areas affecting large numbers of claims, such as
RTA, EL and PL claims.
We do not support mandatory pre-action directions. The courts
should exercise tighter control over pre-action behaviour under the
existing protocols, via costs sanctions. In particular a failure of
a party to engage in alternative dispute resolution (ADR) may, in
many cases, justify sanctions. However, mandatory directions will
tend to shift the focus from dispute resolution to complying with
procedure, which will not encourage settlement.
Mediation is a key feature of the consultation, with proposals
for compulsory mediation on the small claims track and 'mediation
information sessions' for all claims up to £100,000. No mention is
made as to how these will be paid for. While we support ADR, we
consider the Government has fallen into the trap of assuming
mediation is always the best option. In fact, negotiation is often
faster and more cost effective.
Enforcement
Regarding enforcement, the Government proposes a streamlined
system placing more responsibility on enforcement providers, while
also suggesting limits on the availability of certain enforcement
options as a consumer protection measure. While we do consider that
the court enforcement process can be streamlined, we do not
consider it appropriate to remove judicial scrutiny which provides
a necessary protection to debtors. On the other hand, we do not
consider it appropriate that creditors enforcement options be
subject to blanket exclusions. Judges' discretion in granting
remedies can be relied upon to provide the consumer protection that
must form part of the system.
Unified County Court
The consultation also deals with reform of the County Court
structure and system, to create a unified court with increased use
of electronic communications. Both are reasonable suggestions.
However our experience is that the courts already have difficulty
in promptly processing claims submitted online and we question
whether their systems can support a substantial increase in
electronic filing. If they cannot, it seems unlikely that funding
will be forthcoming to address this. Similarly, where courts
currently have centralised business centres, we often encounter
delays. A unified County Court may exacerbate the issue.
Conclusion
The consultation includes proposals which could bring real
benefits to litigants, through a streamlined claims system and
greater certainty on costs. However, the proposals are wide ranging
and to attempt to implement them as a single set of reforms is
likely to be both a length process, and one which risks 'teething
problems' such as those experienced when the RTA PI scheme was
first introduced.
We believe that the focus must now be on identifying those areas
where the benefits outweigh the cost so that these can be
prioritised. In our view, revised track limits, fixed fast track
costs and extension of the RTA PI scheme (at this stage to sub
£25,000 RTAs and sub £10,000 EL claims) should be treated as
priority areas for reform.
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of aspects of the subject matter and does not provide comprehensive
statements of the law. It does not constitute legal advice and does
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