The new issue fee
The changes to the issue fee for claims worth over £10,000, especially if they are also over £20,000 or so, are eye watering.
This is, I understand, expected to come in for 2015/2016. The government has decided to press ahead with this and no more consultation is needed on these changes.
Claims worth less than £10,000 will remain unchanged. At £10,000 or more a new way of calculating the fee is to be introduced. In these cases, the fee is going to be 5% of the size of the claim, up to a top limit of a fee of £10,000.
To get a feel for the new issue fees, I looked at a range of five cases from £11,000 in size to £180,000. At around £20,000 the new issue fee really starts accelerating away from the values we have at present on the scale set down by HMCTS.
Amount of claim Issue fee now Issue fee now online New issue fee
11,000 455 410 550
17,500 610 550 875
40,000 610 550 2,000
75,000 910 815 3,750
180,000 1,315 N/A 9,000
For a claim of £180,000 the new fee is nearly SEVEN times the value at present!
The maximum fee at present is £1,920 for a claim of £300,000 or more. Under the new system, the fee for a claim this size is £10,000 - that is more than five times as much.
Under the new system, the maximum fee is £10,000 and this is reached at a claim of £200,000 or more.
These new fees are massively higher than the fees at present. It is true that most claims are less than £10,000. It is also true that generally all claims, no matter what size, are important to Claimants (otherwise why bring them) and to Defendants, who find themselves having to fight them.
Yet claims of £10,000 or more are to most people involved very significant legal challenges or even battles. If it's a personal injury claim, a case of this size may involve a very serious injury or a substantial loss of earnings or both. In commercial litigation, to many businesses a claim of £10,000 represents a serious threat to their livelihoods and continued existence, whichever side they are on.
These greatly increased fees, following a whole series of previous reforms to legal costs, are another deterrent to people who might otherwise have recourse to our legal system to settle their disputes.
Points for consultation
The Ministry of Justice wishes to consult on changes to the issue fees for possession cases, the consent order fee and application fees. Unsurprisingly all of these involve increases to the existing fees.
The
government proposes increases the fee for possessions claims by £75.
In the County Court the current fee is £280 so this will increase to
£355. At £355 this becomes a rather substantial amount of money to a landlord who may well already be out of pocket from a defaulting tenant who is failing to pay their rent properly. It must make it more tempting to landlords to try alternative, unlawful means to rid themselves of defaulting tenants.
Applications by consent are due to increase from £50 to £100, obviously a doubling of the existing fee. This is not just an increase - it is akin to fining parties who have the temerity to reach a settlement.
The
fee for making most applications to Court used to be £80 for a long
time. It was then increased to £155 and the government is now proposing
to increase it to £255. To my mind, £255 is a very large sum for an
application at Court. £80 is a sensible value in my view; big enough to make you think seriously before applying but not so big as to put you off making an application when you need to just because of the size of a Court fee. The figure
of £255 is more than the issue fee for claims less than £5,000.
It's worth remembering that this will apply to cases of all sizes, even in the lower end of the personal injury claims, say £3,000 or so. In those cases, a figure of £255 looks very high when compared to the fixed inter-partes costs a successful party can recover from the opponent at the end of the case.
These reforms are a further erosion of people’s ability to stand up for themselves using our legal system. The senior judiciary have produced a response to the reforms that sets out in beautifully precise language the full ramifications of the government's approach to this issue and this is available here: http://www.judiciary.gov.uk/wp-content/uploads/JCO/Documents/Consultations/senior-judiciary-response-court-fees-proposals-for-reform.pdf.
The rule of law on which a democratic society is founded rests on citizens having access to the courts. A Court system has to be a service provided by the state in a democracy and this is not reliant on the costs involved. The reforms undermine that in a practical sense and, which is more worrying, the government's philosophy that has lead them to this position is an attack on the nature of our democracy.
At One-Stop-Law we recognize that every Personal Injury claim is different. We are passionate in ensuring that every Personal Injury claim that we accept is actively pursued to the highest professional standards. That is why we only select the best legal professionals to represent our customers. We ensure that the legal professional we appoint to represent you is appropriately qualified and experienced to deal with your claim.
ReplyDeleteGood share. Court fees have always been a staple of American laws firms and also have helped drive mass tort and class action litigation forward in America.
ReplyDeleteIn payment terms, it's proven itself to be a great marketing tool to be used in drawing in new clients. Accepting payments only when you win your client's case allows people less costly options when seeking to file case. Recently i read a very good blog on this. You can also have a look on it bkwlawyers.com/blog/.
http://bkwlawyers.com/
DeleteNice Post!! These court fees are technically still under review. If the new system is seen to be ineffective, then the new fees will not be kept in place, but as it stands they cannot be challenged in any civil or family law cases.
ReplyDeleteThe increase in the fee amount has been justified by Lord Faulks as a fair way of gaining back some of the costs encountered in the legal processes pertaining to justice.