A consultation on court fees published by the Ministry of Justice (MoJ) proposes that parties to some civil and commercial claims could subsidise other cases, and pay for investment in the court system.
Running costs of civil courts in England and Wales add up to £600m a year. At present the service runs a £100m deficit, leaving taxpayers to foot the bill. The MoJ expects the changes to generate nearly £200m a year.
Family work in the civil courts costs more than the fees generated, while other areas such as injury and commercial claims have been broadly self funding. By grouping these together the Government seeks to achieve a self-funding system. a result, many will be disappointed to see proposals to add cost elsewhere in civil litigation.
Proposed changes include increasing fees paid by parties in commercial disputes to up to £20,000 and introducing a daily hearing fee of £1,000.
Fees for cases involving claims for money will increase on a sliding scale, with a maximum fee of £1,870. In future the government is to consider introducing a system where the fee is calculated as a percentage of the amount under dispute in a case.
It is proposed that a standard fee of £270 will be introduced for civil cases that are not about claims for money, instead of the current mixture of fees.
The consultation paper states there is a ‘pressing need’ to place HMCTS on a ‘solid financial footing’.
Courts minister Shailesh Vara said: ‘We have the best court system in the world and we must make sure it is properly funded so we keep it that way.
‘Hardworking taxpayers should not have to subsidise millionaires embroiled in long cases fighting over vast amounts of money, and we are redressing that balance.’
However, the fees proposed may force companies, that are owed money, into taking a commercial decision on whether or not it is cost-effective to pursue a debtor through the courts or not.
Whether this changes are implemented or not, anyone who is owed money must consider all avenues open to them. Taking someone to court may not be the best option.
For further information and advice please contact Paul Davies on 01489 550 496 or email email@example.com.