Small claims threshold to double
The Government is expected to announce today that the threshold for a civil (money) claim in the County Court for a case to be classified as a small claim will rise from £5,000.00 to £10,000.00.
The small claims court is not a separate court as such, the system works by a claimant issuing a claim in any county court of their choice. The court then sends a response pack to the defendant. If a defence is filed the court then decides, with representations from the parties in a questionnaire known as a an allocation questionnaire, whether the claim should be a small claim or otherwise. the vast majority of claims within the financial limits detailed above will be allocated as small claims, but if a counterclaim is filed by the defendant which may exceed the value of the claim or if the case is very technical, it is possible the court will decide that the case is not suitable for the small claims court.
As with all things, there are advantages and disadvantages of the small claims system. On the one hand, the system fundamentally helps access to justice in that there is a general no costs rule in the small claims court for legal fees, regardless of which side wins or loses the case. This enables more claimants or defendants to fight a case without fear of being financially bullied by the risk of paying a rich opponent’s expensive legal fees. On the other hand, this doesn’t mean a big company defendant won’t use a lawyer in the small claims court. The potential drawback is that the court must still apply the law and many personal or business users of the county courts still need legal advice on the law or court procedures. So, a claimant with a very strong claim which feels he, she or it needs a lawyer will end up having to pay legal fees out of any monies recovered from using the court.
Do you have a view on the small claims court, the doubling of the financial threshold or perhaps you have experiences, good or bad, of using the small claims court. If so, please provide your comments.