“Scant evidence” for court fees hike

The Law Society has accused the government of basing controversial proposals to hike court fees on “scant evidence”.

The Ministry of Justice (MoJ) plans to charge a higher fee on money claims from April 2015 have virtually united the legal profession in opposition. Both claimant and defendant personal injury lawyers have expressed concern, as have the Lord Chief Justice, Bar Council and Civil Justice Council.

The new fee would be 5% of the value of the claim on claims worth more than £10,000, with a cap of £10,000 on claims for more than £200,000. The current maximum fee is £1,920, which means the proposals would hike court fees by as much as 420%.

Lawyers warn that small- and medium-sized businesses would be unable to take debtors to court while hospitals and other public institutions would bear the brunt of personal injury claimants who cannot seek redress.

Law Society president Andrew Caplen says: “It cannot be right that the government has based a decision with such wide-ranging consequences on limited small-scale research and scant evidence. The phrase ‘false economy’ does not even begin to describe this disastrous announcement from the government.”

The Law Society has asked to see the raw data and evidence used by the government to formulate its decision and will be asking members for data and evidence over the coming weeks.

The fee rise will affect money claims, including business debt owed under contract, personal debt, personal injury claims for unspecified amounts and international contract disputes.

Writing in NLJ this week, NLJ consultant editor David Greene, partner at Edwin & Coe, says the proposal “marks a sea change in court fees because, contrary to established policy, it allows the Lord Chancellor to make a profit out of the fees charged for seeking the public court to resolve a dispute, or again as some might put it, securing access to justice.

“Some suggest that the effect of hiking fees will be self-defeating because business will reduce. The government appears to accept this.

“As far as international business in the commercial courts is concerned it has ditched fee increases because it might dissuade international business from using our courts. The irony is extraordinary.”