UK: Fixed Costs In Litigation – Why We Need To Fix The Civil Court System To Reduce Costs In Litigation

Last Updated: 16 March 2017
Article by Luke Harrison

If Lord Justice Jackson is to implement fixed costs reform for cases in the lower echelons of the multi-track this needs, in my view, to take place simultaneously (or after) wide sweeping reforms have to be made to the civil courts. 

In his review on the civil court structure published in July 2016 Lord Justice Briggs acknowledged Jackson's view that changes to the civil court structure would be necessary as part of the package of costs reform. He said "His general approach, which he has been kind enough to share with me in outline, is that he regards the pursuit of an extended fixed costs regime, the further development, improvement and streamlining of costs budgeting and costs management, and the introduction of modern IT into the process of costs assessment as all working alongside the introduction of an Online Court as measures which contribute in a complementary way, rather than in competition, to the provision of an effective overall remedy for the adverse effects upon access to justice constituted by the continuing disproportionality between costs and value at risk in large parts of the workload of the civil courts." 

But what are the drivers of costs in the civil courts? What changes need to be made to stamp them out and has Briggs gone far enough in his recommendations? In this article I won't be looking at the procedural codes of the civil court system but rather focusing on the way in which the civil courts operate. 

Much of lower value litigation in the multi-track takes place in the county court. Recent cuts and supposed efficiency moves have led to a fragmented county court system. Money claims (essentially any claim for a financial remedy) are issued centrally out of the Northampton County Court (which incidentally operates from Salford), known as the 'Money Claims Centre'. When defences are filed cases are transferred to either the defendant's local court (if the defendant is an individual) or the court chosen by the claimant. These reforms have, in my view, worked well to cut the volume of work undertaken by local county courts around the country. 

Problems arise, however, once a case is transferred into a county court. County courts have no way of gauging the number of cases that will come to them and so managing staff workload is extremely difficult. This could be resolved by working out each county court's capacity levels and ensuring that cases are allocated more evenly on transfer. Such a system requires an understanding from the Money Claims Centre of the existing levels of business being undertaken by each county court and an effective system of archiving / case closure in county courts so that case volumes are accurate. 

The centralised 'helpdesk' for the county court system is also an oxymoron. Often described by practitioners as the 'unhelpful desk' its staff, who are also centralised, can do little other than read off pre-prepared scripts, provide basic information on procedure and information from the centralised computer system. Calls to the helpdesk by practitioners and litigants often involve chasing the progress of applications or some other aspect of a case that is awaiting court or judicial intervention. It is all too common for the helpdesk to inform a practitioner or litigant that a file is with a judge with no further information being proffered. What this often means is that the file has been checked out but this doesn't actually necessarily mean that something is happening. There are frequent requests from practitioners to reconstitute the court file because it has been lost. Practitioners also have the impression that more complicated applications or issues are put to the bottom of the judge's work pile. Unlike the High Court it is rarely possible to speak face to face to court staff as many county courts simply have a 'drop box' facility. 

Correspondence to the county court also often goes unanswered. The courts bemoan practitioners chasing them for a response as it adds to their workload yet they fail to acknowledge (save for automated an email acknowledgement) correspondence or indicate any timescale in which the correspondence will be addressed. Again chasing sometimes yields no fruit but other times it is the chasing that reveals that the file has been lost. 

Cases are often adjourned. The court regularly lists cases from the small claims track to the multi-track in bulk lists hoping that some of the cases will settle. When they don't, practitioners receive a call, often a day before trial, to advise that the trial is to be relisted "due to lack of judicial availability". In the last two years I have seen two trials out of maybe four or so that I had conduct which were heading to trial in the county court adjourned this way. These two cases were adjourned twice with one of the cases specifically listed on what Birmingham County Court called a "must heard basis". 

Cases often get adjourned at the hearing because the judge "doesn't have enough time to deal with it". These adjournments, granted, occasionally lie at the door of the practitioner who has failed to adequately estimate the time required for the hearing. However, they sometimes arise out of an earlier overrun or where the judge hasn't had sufficient pre-reading time or because the opponent 'ambushes' the hearing with late submissions of evidence. Such adjournments are all too common in cases where one party is a 'litigation in person' (LIP). 

There is a tendency for the courts to reserve judgments following trial. Judgments are supposed to be handed down within a reasonable period of time (Article 6 of the European Convention of Human Rights) but often take several months. In simple cases the handing down of a reserved judgment involves a further attendance at court, further sets of submissions for consequential orders and the associated preparations. Oral judgments (judgments ex tempore) delivered immediately following trial would greatly reduce the level of costs involved. They have the advantage of enabling the parties to make submissions to consequential orders on their feet and reduce the time lag for resolving litigation.  

The way in which the court conducts the business of litigation can have significant impacts on the level of costs a party incurs. Delays in processing claims, when the ball is in the court's court (if you pardon the pun) can involve several hours of practitioner time chasing the court, updating and explaining the situation to the client and dealing with the opponent over the issue. Adjournments of trials and hearings are particularly costly. They result in abortive or increased counsel fees and further preparatory costs for the hearing. Judges ought to be encouraged to deliver more ex tempore judgments. In my view these issues need to be incorporated into a package of reforms if the cost to clients is reduced. Briggs acknowledges in his report that this is an issue which the MoJ and HMCTS don't recognise, "This subject remains a matter of real concern, not least because it has yet to be agreed at senior judicial level, or within HMCTS or MoJ, that this is in fact a weakness in the structure of the civil courts at all". 

More worryingly Brigg seems to view problems in the court system as London and High Court centric (see paragraph 8.2 of his report) whereas they are pervasive, in my experience, throughout England and Wales. Granted Central London County Court may be renowned for being particularly problematic, but in my experience regional county courts (Watford, Birmingham, Luton etc.) have similar issues. The answer is not, in my view, to push work out of the High Court and into the county but to (a) properly equip the county court for its expected workloads (b) set a base level of defined service levels and (c) manage performance against those service levels. 

I am due to meet with Lord Justice Jackson this month at a round table meeting as part of his consultation into fixed costs reform. Feedback from practitioners and users of the civil courts would be much appreciated. Please email any comments to lth@debenhamsottaway.co.uk

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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