CASE TRACKING FOR LAWYERS

CASE TRACKING FOR LAWYERS




Case Track Limits 
Background
The Civil Procedure Rules
(CPR), implemented following Lord Woolf’s report, Access to Justice, provide a
single set of rules that apply to claims both in the High Court and the county
courts. Their purpose is to ensure that cases are dealt with in a way that
upholds the principles of ‘equality, proportionality and expedition.’1 They
provide for a system of case management tracks that have different rules to
ensure that cases are dealt with in a manner appropriate to their value and
complexity. . All defended civil claims are allocated to one of three tracks:
the multi-track, the fast track or the small claims track. The courts’ powers
in relation to the allocation of claims to tracks can be found in Part 26 of
the CPR. There are several factors that the court can take into account when
allocating a claim to a certain track, for example, the views of the parties
and the nature and complexity of the claim. However, the most straightforward
way for the courts to distinguish between cases is on the basis of monetary
value, so each different track has a financial limit, which determines what the
normal track for a claim will be.
3. Currently cases
allocated to the small claims track are those with a monetary value of less
than £5000. There are two exceptions to this general rule. The first is
personal injury claims where a limit of £1000 applies (this amount relates to
the damages awarded for pain, suffering and loss of amenity (PSLA) only and
excludes any other damages claimed). The second exception is housing disrepair
where the limit of £1000 applies for the cost of the disrepair and £1000 for
any other damages arising from the disrepair. Claims that are allocated to the
fast track are those with a value that exceeds the limit of the small claims
track, but is less than £15,000. The multi-track is the normal track for any
claim that does not fall within the scope of the small claims or fast track
(i.e. predominantly with a value exceeding £15,000). 4. The purpose of the
small claims procedure has always been to provide an informal environment in
which disputes can be resolved in a simple, straightforward way that is
accessible and proportionate to their low value. This means that the normal
procedural rules and the strict rules of evidence do not apply (for example
witnesses do not have to give evidence on oath). The presence of expert
witnesses is subject to the agreement of the court and hearings are conducted
in an informal manner, often with parties sitting around a table.
5. The cost rules relating
to recoverable costs for the small claims differ greatly from those of the fast
track and multi-track. In the latter two tracks the successful party is
generally able to recover their costs, including the cost of legal
representation, from the unsuccessful party. In the small claims track the
costs that can be recovered from the other side are strictly limited. The usual
rule is that the court may only award fixed costs attributable to issuing a
claim, any courts fees, reasonable travelling expenses for a witness or party
and limited costs for loss of earnings for a party or a witness (up to £50 per
day per person). In addition fees of any permitted experts (currently limited
at £200 per expert) can be claimed and an amount up to £260 can be claimed for
legal advice and assistance in claims including an injunction or specific
performance. No costs can be claimed for legal representation or for the
services of a lay representative. 6. This part of the consultation paper
considers all the case track limits.
The Financial Limit of the
Small Claims Track 7. The small claims procedure was first introduced in 1973,
and evolved out of a judge’s statutory power to refer a case to arbitration.
The limit was originally set at £75 but this has increased over time. In 1991
it was set at £1000. In 1995 Lord Woolf published his Interim Report and the
following year the limit was raised to £3000. 8. It was at this time that the
system of differential limits was introduced. Some groups, including lawyers
who specialised in personal injury claims, argued forcibly that the complexity
of these claims meant they could not be dealt with within the small claims
procedure. In particular, attention was drawn to the difficulty claimants have
in assessing the value of their claims and the worry that they may
substantially underestimate the value of their claim. The then Lord Chancellor
felt that claims with a value below £1000 were being dealt with fairly but
decided that the limit should not be raised further for this type of claim.
Similar arguments were raised in relation to housing disrepair cases. This
initially led to specialist cost provisions (to reflect the fact that these
cases involve bringing an injunction) but later to the different limits of
£1000 for the disrepair and £1000 for any other damages claimed. 9. In April
1999 the track limits for small claims were examined again. Research had
indicated that the rise to £3000 was generally considered to have been
successful and the decision was taken to raise that limit again to £5000. At
the same time the limits for personal injury and housing disrepair claims were
reviewed. The limit for personal injury claims remained at £1000, but it was
decided that it should apply to general damages only (i.e. the money awarded
for PSLA) rather than the value of the entire claim.
. In May 2004 the Better
Regulation Task Force (BRTF) published the report, Better Routes to Redress. As
part of their report they examined the small claims procedure. They concluded
that the costs rules mean that claimants in person have the ability to bring
claims against represented defendants, as they know they will not have to pay
their costs if a claim is unsuccessful. The BRTF considered that there was an
argument for raising the current limit for the small claims track for personal
injury claims. They recommended that the Department for Constitutional Affairs
(DCA) should carry out research into what the small claims limit for personal
injury claims should be ‘but justify any limit lower than £5000.’2 11. The BRTF
stated that research carried out on the rise to the limit from £3000 to £50003
demonstrated two positive and significant points. The first was that the rise
did not result in a dramatic increase in the number of cases being litigated in
the small claims track, as was feared before the limit went up. The second was
that both litigants and the judiciary expressed approval in the small claims
process. The BRTF cited this approval as supporting the idea that raising the track
limit for personal injury claims would improve ‘access to justice for many as
it will be less expensive, less adversarial and less stressful.’4 12. The Civil
Justice Council (CJC) considered the matter of raising the track limit for
personal injury claims in the report Improved Access to Justice – Funding
Options and Proportionate Costs (published in August 2005). The CJC stated it
was necessary to focus on achieving proportionality of costs within every track
and cited as a positive example the fixed costs for fast track road traffic
accidents (RTAs). They recommended developing fixed costs for a wider range of
cases. 13. The CJC did not agree with the BRTF that the track limit for
personal injury claims should be raised. They expressed concerns that raising
the limit would mean that claims would be dealt with either by claimants in
person who may find the complexities of personal injury law difficult to grasp,
or by unregulated claims management companies. On the latter point the
Compensation Act 2006 provides for the regulation of these companies.
The Constitutional Affairs
Select Committee (CASC) considered the small claims limit in The courts: small
claims (published in December 2005). This report stated that the central issue
was whether legal representation was necessary for those personal injury claims
with a value at the higher end of the scale. There was a wide range of evidence
put forward from the organisations whose views were sought. CASC was concerned
that many of the injuries originally intended to fall within the small claims
bracket (minor injuries with no long-term effects) no longer do so, due to
inflation in damages. It was on this basis that the Committee recommended that
the limit be raised to £2500. The report also recommended that in order to
ensure consistency of approach, it would be sensible if the limit for housing
disrepair cases was raised by the same amount. It added that when considering
the housing disrepair limit, however, it would be essential to ensure that
vulnerable tenants were not unduly disadvantaged by any change.
Small Claims Limit for
Personal Injury Claims 15. In its response to the BRTF report the Government
recognised that there are concerns that the processes and costs in lower value
cases are often the most disproportionate. Raising the limit for the small
claims track would be a way of resolving this problem. However, the Government
also recognised concerns about the potential lack of legal representation for
claimants if the small claims limit for personal injury claims was raised to
£5000. The Government therefore undertook to consider other options for dealing
with these claims in a more timely, proportionate and cost-effective way. These
options have been considered and proposals for improving the system are set out
in the second part of this paper. First we consider whether the small claims
limit for personal injury cases should be raised. 16. Following the various
recommendations on this subject, the Government has received a considerable
number of submissions and correspondence from stakeholders, the majority of
which have strongly opposed any increase in the limit. Various organisations
have also published their proposals. The arguments for and against raising the
limit are summarised below.
Arguments in favour of an
increase in the limit • Insurers are concerned that the fast track system is
not working well for personal injury claims with a value at the lower end of
the scale. They cite the disproportionately high costs that have been recorded
as proof of this. It has been contended that rather than the fast track, the
proper forum for hearing low value personal injury claims is the small claims
track, which is viewed as a more efficient system. If the limit on the small
claims track was raised it would lead to a more predictable process. • An
increase in the limit would lead to a decrease in the amount of money paid out
by insurers (as they would not be burdened with paying the claimant’s legal
costs) which in turn may lead to a decrease in insurance premiums. Raising the
limit is a simple way of solving the issue of disproportionately high costs as
it would mean that the majority of personal injury claims would be taken out of
the fast track. • Since 1991 there have been developments in the type of lower
value injuries, which are the focus of many personal injury claims, For example,
there has been a large increase in claims for injuries such as whiplash. These
injuries are considered simple and straightforward for a claimant in person to
understand. It is argued that these injuries should fall within the remit of
the small claims track but do not do so because the limit was set so long ago.
There is a blanket
assumption put forward by claimant lawyers that personal injury cases are more
complicated than other types of claims. Insurers believe that this is an
assumption that needs testing. • Although claimants may find it difficult to
bring a claim without legal representation, it has been pointed out that there
is already support and assistance available to them. For example, there are
leaflets published by Her Majesty’s Courts Service, specifically designed for
the claimant in person, which contain information about the small claims track.
These contain advice on the eligibility of cases for the small claims track and
preparation for a hearing. It has been suggested that if the limit was raised,
an increase in this type of literature could be very helpful to claimants. •
CASC stated that raising the limit to £2500 would be a reasonable compromise
between no change at all and a dramatic increase to £5000. They stated that an
increase to £2500 would bring the minor claims that Lord Woolf had in mind back
into the scope of the small claims jurisdiction (this issue is examined later
in the paper).



An increasing number of
claimants now have the benefit of Before The Event insurance (BTE) which is
often purchased as an addition to a motor or household insurance policy. These
policies can give assistance in a variety of ways such as offering legal advice
or help with paying disbursements. If a claimant already has BTE as part of an
insurance package then they may be able to bring a claim without engaging a
solicitor. • Unrepresented parties are not necessarily disadvantaged when
against a party with legal representation as often the majority of work in
establishing a claim is carried out before the hearing takes place. In
addition, to level the playing field greater use could be made of opportunities
for unrepresented parties to obtain advice prior to hearings through the
voluntary sector. CASC considered that any disadvantage to claimants in raising
the limit could be ameliorated by better provision of advice and support before
the parties attended court. • District judges have the responsibility of
equalising the uneven playing field in claims not involving personal injury
where one party is unrepresented. This is often achieved by adopting a more
interventionist approach. They should be able to carry out the same function in
relation to personal injury claims. • The impact of inflation should be taken
into account and that raising the limit to £2500, or £5000 would make
allowances for inflation proofing.
Arguments against raising
the limit • Claimant representatives indicate that personal injury claims are
complex and often require independent legal guidance and expert evidence, the
cost of which would be prohibitive if the limit were raised. The substantive
law involved in a personal injury claim can be complicated and a claimant in
person may not be aware of regulations or statutory duties that could apply to
their claim. In addition issues such as identifying the right defendant and
establishing a breach of duty of care can be difficult for an unrepresented
claimant to understand. It can also be hard to collate the necessary evidence,
medical and otherwise, to prove a claim. Potential claimants could be put off
by the work involved and would not bring a claim • In a vast majority of claims
the defendants to personal injury claims are insured and the insurance
companies can afford to be legally represented or will use expert claims
handlers, even in lower value claims. If the limit was raised the claimant
would often not be able to afford legal representation and would have no prior
knowledge of establishing a claim. This could lead to inequality of arms.
There is the added concern
that potential claimants could have strong claims but be unable to afford legal
representation or conduct their own claims either because they are poorly
educated or because they do not have English as their first language. These
people are often the most vulnerable in society. There is a real danger that
they will be deprived of access to justice. • Although these claims are
referred to as low value, a sum of £1000 or £2000 is a significant sum of money
to the overwhelming majority of the population. • It is estimated that as many
as 80 per cent of claims brought on behalf of trade union members have a value
of less than £5000. The trade unions are concerned that raising the limit would
mean that their members would no longer be legally represented but would be
claiming against insurance companies who would be represented. The current
situation allows the trade unions to offset claims for less than £1000 (where
costs for legal representation cannot be claimed) against the majority of cases
with a value between £1000 and £5000. If the limit were raised then they would
be unable to afford to provide legal representation for all personal injury
claims brought within the small claims track.

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