Potential Dramatic Rise in Court Fees

On 16 January 2015 the Government published its response to a consultation on “enhanced court fees”, announcing that the fee to issue a claim to recover more than £10,000 will rise to 5% of the value of the claim, up to a limit of £10,000. The cost to issue proceedings for less than £10,000 will be unchanged.

For example, once the changes are introduced the fee to begin proceedings in Court in a claim worth £100,000 will be £5,000 (current cost: £910); with proceedings for a claim of £200,000 or more costing a massive £10,000 to issue (currently, fees range from £1,315 to £1,920.)

The Government is anticipating that the changes will bring in an additional £120m per year in income and that it hopes to give effect to the new fees this April.

The Government states that the drastic rise in court fees is unlikely to put off potential claimants. Needless to say, this seems highly unlikely in practice, and it is the opinion of solicitors, barristers and Judges around the country that such a dramatic increase in upfront costs is very likely to turn away a vast number of potential litigants, who may have entirely reasonable claims but simply cannot afford to issue them. The changes will also undoubtedly lead to a further increase in the numbers of self-represented litigants as claimants are forced to spend their money on court fees rather than on legal representation. With the Courts already swamped with litigants in person as a result of massive legal aid cuts, the overall efficiency of the Court system is likely to fall even further.

Law Society president Andrew Caplin has stated: “We will not let these changes go through without challenge. Court fee hikes introduced by the government from April spell disaster for access to justice, pricing the public out of the courts and leaving small businesses saddled with debts they are due but unable to afford to recover.”

Keith Etherington, Society council member for solicitors in civil litigation has said: “Many [solicitors] complain that the punitive effect of the fees undermine the Jackson reforms. A whole new industry of ATE [After the Event insurance] and disbursement funding will arise making further inroads into the compensation that clients are entitled to. There are real concerns that the courts will be the domain of the rich only.”

It is worth noting that when Employment Tribunal Fees were introduced nearly two years ago it led to a drop in claims of 70%.

Oliver Kew
 

Published on 13/02/2015