Justice Secretary announces changes to the civil justice system

Justice Secretary Kenneth Clarke recently announced that the limit of £5000 on small claims in the county court is to be doubled to £10,000 as part of steps by the Ministry of Justice (MoJ) to expedite civil litigation. Mr Clarke announced plans to divert up to 80,000 more cases to a small claims quick telephone-based mediation service.

Mr Clarke stated that:

“…Without effective civil justice, businesses couldn’t trade, individuals couldn’t enforce their rights, and government couldn’t fulfil its duties. But individuals and businesses tell me that the civil justice system at the moment can sometimes be intimidating and that they don’t know if using the system will be worth the time, expense and hassle of going to court. I want to make the system as easy and transparent as possible. I want people to be able to resolve their disputes cheaply and simply through the courts’ very successful mediation service and I want judges freed up to make quick and effective judgments based on the facts of a case, without unnecessary legal complication. These changes will produce a service that helps people to resolve their disputes effectively and in the simplest and quickest way possible so they can get on with their lives and businesses…”

The proposals are set out in the MoJ’s response to its consultation paper on reforming civil justice in England and Wales: ‘Solving disputes in the county courts: creating a simpler, quicker and more proportionate system’,

The main proposals of the government’s response to the paper include plans to:

  • Simplify the majority of cases: The limit for small claims is to be increased from £5,000 to £10,000 with a view to raising this limit to £15,000. All small claims will automatically be referred to the Small Claims Mediation Service, though mediation will not be mandatory. Small claims cases going forward are not expected to require comprehensive legal preparation.
  • Modernise and streamline the County Court system: A single county court is to be introduced. This will allow claims to be processed electronically and to then be allocated across neighbouring courts according to demand. Restrictions will be lifted on High Court judges sitting in County Courts while waiting to take cases in the High Court.
  • Free up the High Court to only deal with necessarily complex cases: The level below which non-personal injury claims cannot be heard in the High Court will rise from £25,000 to £100,000. Equity cases will only be referred to the High Court where the property is valued at £350,000 or more, rather than the current limit of £30,000.
  • Extending a web-based scheme which controls legal costs for the majority of personal injury cases: The portal scheme will now apply to employer and public liability personal injury cases and road traffic accident (RTA) cases worth up to £25,000, up from the current £10,000 limit.

Iain Stark, chairman of the Association of Costs Lawyers, says: “The portal scheme was designed for low value RTA claims:

“There appears to be nothing in the government’s response about the potential increased costs relating to this. It is effectively asking solicitors to undertake the same work at £25,000 as they would have for £10,000…The impact will be two-fold: a sausage factory approach with one senior litigator overseeing work carried out by inexperienced staff; and an increase in litigants in person, which will be a disaster in this specialist area…”