Wednesday, September 12, 2007

Justice Secretary's raising of small claims limit falls short of England & Wales

It took the Scottish Government 19 years to raise the small claims limit from a meager £750 to £3,000.

Not quite in line with the rest of the country (there always seems to have to be a Scottish drawback of sorts when it comes to all things legal) but we are getting there ....

Perhaps fair play will prevail and the limit eventually raised to £5,000, which England & Wales enjoy without any problems ...

If you want to read more about some of the 'obstacles' which have been put in the way of the raising of the small claims limit over the years, we suggest you read Peter Cherbi's interestingly titled piece from last year : Small claims limits in Scotland restricted to £750 for the last 18 years by the legal profession for their own interests.

Today's Press Release from the Scottish Government :

Small claims limit increased


A fourfold increase in the limit for small claims cases will benefit many more people throughout Scotland.

Justice Secretary Kenny MacAskill today announced that from next January someone taking a small claims action in the sheriff court will be able to do so up to a maximum of £3,000. The previous limit was £750. This will mean that cases such as disputes about houshold goods and bank charges could be dealt with in the relatively simple, quick and easy to use small claims procedures of the sheriff court.

In addition, all personal injury cases are to be removed from the small claims procedure to enable anyone pursuing such a claim to obtain the necessary medical evidence and legal representation required.

Mr MacAskill also announced a number of other changes to sheriff court jurisdiction limits as follows:

Summary cause actions - Over £3,000 up to £5,000 (previously over £750 up to £1,500)

Ordinary cause rules will apply in cases over £5,000

Privative limit (any cases below this figure must be raised in the sheriff court) - £5,000 (previously £1,500).

Kenny MacAskill said:

"This government is committed to improving access to justice for all. This includes access to a quicker, simpler and cheaper small claims procedure.

"Hard-working Scots who have perfectly valid claims are currently being denied accessible justice due to the existence of an artificially low small claims limit.

"It is now 19 years since the limits were last increased and I believe the time has now come to set more realistic limits.

"These new limits will mean that many more people will be able to make use of the less complicated small claims system within the Sheriff Court to resolve such claims. People, who in the past were prevented from pursuing a claim against a business or individual will now be able to do so without having to employ a lawyer with all the extra expense that entails.

"As part of the package of new measures announced today, I have decided to remove all personal injury actions from the small claims procedure. This will mean that anyone pursuing such a claim will be able to obtain the necessary medical evidence and legal representation required.

"From next January, many more Scots will have better and cheaper access to justice thanks to this government."

Martyn Evans, Director of the Scottish Consumer Council, said:

"This is good news for Scottish consumers. We are delighted the Scottish Government has taken this decisive step to increase access to justice for people who buy goods and services. We have been lobbying hard for a realistic small claims limit for a number of years, and this is a welcome early decision by the new administration.

"Every day people in Scotland buy computers, holidays, three-piece suites and other items that cost much more than £750. Now they will be able to seek legal redress against businesses which do not comply with the law, without having to face the choice of suing for less money than they are owed or paying a solicitor to go to court.

"We also expect an increase in the limit will be an important additional incentive to ensure companies act in a fair dealing manner."

CASE STUDIES - Below are a couple of mock examples of how the increase in the small claims limit will allow many more people to bring such actions.

Household Goods

Mrs X bought an oak dining table for £1,200. On closer inspection, following delivery, she noticed that there was a scratch down one of the legs of the table. The company refused to replace the table. Mrs X decided not to bring a summary cause action in case she lost and had to pay unknown amount of expenses. The increase in the small claims limit means that Mrs X is able to bring a small claims action without worrying about how much it might cost her.

Bank Charges

Mr Y wanted to take court action to recover £2,250 worth of bank charges paid over the last three years. He didn't want to use the ordinary cause procedure because of the expense involved so he decided to make three separate small claims of £750. The sheriff ruled against Mr Y making a multiple claim concerning the same bank account. Increasing the small claims limit to £3,000, means that anyone in Mr Y's position would only have to use the small claims procedure once to reclaim bank charges up to £3,000.

There are three procedures in dealing with sheriff court civil actions. These are small claims actions, summary cause actions and ordinary cause actions. Where cases relate to recovery of a sum of money, that sum determines which procedure the case should follow. A small claim is a claim of value of £750 or less. Summary cause procedure applies for actions more than £750 but less than £1,500. Ordinary cause actions deal with cases of value more than £1,500.

There is a choice for litigants as to whether they litigate in the sheriff court or in the Court of Session. So as not to have too many low value claims in the Court of Session, there is a limit below which that choice does not exist and where it is necessary to raise actions in the sheriff court. That is known as the sheriff court privative limit and this is at present £1,500. Therefore any actions which are raised for a value of less than £1,500 can only be raised in the sheriff court and cannot be raised in the Court of Session. These levels are collectively known as jurisdiction limits.

Normally financial limits of this nature would be uprated periodically in an uncontentious way. However, in this case, it has now been 19 years since the jurisdiction limits were last increased.

No comments: