Court fees for claims over £10,000 are set to dramatically increase in April 2015. The controversial move, which has drawn criticism from Judges as being a restriction on access to justice, will see fees charged at 5% of the value of the claim, with a cap at £10,000 for claims with a value of £200,000 plus.
By way of illustration, a claim for £10,000 currently has a fee of £455. The new proposed fee would be £500. A claim worth £20,000 currently has a fee of £610; the new increased fee would be £1,000. The true effect of the increase can however be seen in higher value claims, i.e. a £100,000 claim has a current fee of £910 but the new proposed fee would be £5,000.
Whilst wealthy companies and individuals may not be deterred from pursuing claims as a result of the fee increase, individual claimants or SME’s may be put off pursuing claims because of the increased court fee.
Prior to April 2015 we may well see a clamour to issue claims at the Court before the fee increase comes into force. It may force the claimant to issue proceedings sooner that anticipated, just to avoid pay the increased court fee. However, it should also bring into focus the importance of Alternative Dispute Resolution (ADR), and in particular mediation.
While mediation does not provide a guarantee of a resolution, it does provide litigants with an opportunity to reach an early settlement in a more cost effective manner than through the Courts. Whilst this was the case prior to the proposed increase in fees, it brings it into even sharper focus how important it is to consider ADR and explore whether settlement can be reached without the need to issue proceedings.
The Dispute Resolution Team at Steele Raymond has a wealth of knowledge and experience of the mediation process and can advise and assist parties in bringing a dispute to mediation. Should you wish to discuss the potential impact of the proposed increased, or explore ADR, please do not hesitate to contact a member of the Dispute Resolution Team on 01202 294566.
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