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Published 5 March 2015
The Ministry of Justice (MOJ) has announced increases to the court fees charged on civil claims issued on or after 9 March 2015.
The new fees which apply to money claims will be as follows:
Value of claim
up to £
Increase in fee
The increases have been controversial and opposed by many professional associations including The Law Society, The London Solicitors Litigation Association (LSLA), the Bar Council, the Forum of Insurance Lawyers (FOIL) and the Association of Personal Injury Lawyers (APIL). On 22 February 2015, The Law Society issued a pre-action letter seeking judicial review of the MOJ's decision, and this challenge is ongoing.
Opponents have argued that litigation will be prohibitively expensive for many private individuals and small and medium sized businesses, that the enhanced fees will lead to a substantial front loading of costs in the litigation process, and the fee rises go beyond what is necessary for the civil courts to be self-funding. Some have also raised concerns that the rises will make the English courts, and particularly London which is a leading centre for commercial dispute resolution, less attractive to domestic and international court-users, and that parties may look to other jurisdictions to resolve their disputes.
For defendants and their insurers, the impact of the fee rises could produce two effects. If opponents of the fee rises are correct, then there will be a reduction in the number of claims being litigated generally, and this reduction may off-set or dilute the impact of the enhanced fees incurred in litigated claims where insurers do pay out. Claimants may be also more willing to engage in early, pre-action settlement discussions in appropriate cases to avoid incurring the court fees altogether. Some claimant firms will however simply maintain their aggressive litigation policy and hope to ride out the adverse cash flow consequences, secure in the knowledge that the higher court fees will be met by defendant insurers and have to be passed on to policyholders.
One thing is clear. The effect of these changes will be immediate, applying to any proceedings issued from Monday 9 March onwards, and in marked contrast to the pace at which other reforms filter through to the bottom line.
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