A litigation expert says it has become more important than ever to consider alternative ways to resolve disputes after the cost of starting court action was significantly increased.
Robert Richards, partner in the Litigation team at Napthens solicitors, has highlighted that following the Government’s recent increase in court fees for certain financial disputes – known as money claims – it will cost thousands of pounds just to start the legal process. Money claims are used when money is owed by one party to another, and Robert warns that the increased cost will make it more difficult for claimants, particularly small businesses, to start claims.
Under the changes to the fee structure, fees for claims from £1 to £9,999 will stay the same, but claims for £10,000-£199,000 will be five percent of the claim, and for claims above £200,000 will be £10,000.
Robert said: “The changes include significant increases. Claims of £200,000 or more are not uncommon, and under the old system cost £1,515 to begin the process. Now the cost is £10,000, an increase of almost 600 per cent.
“The increases will of course make money for the Government, which has been a very controversial topic, but for those using the legal system it will place greater emphasis on the need to find alternative ways to resolve disputes.”
He added: “Taking advice early on in a claim rather than waiting for the 11th hour will provide a better opportunity for claimants to consider alternative methods such as arbitration, mediation and settlement meetings.
“The best thing to do is always to take legal advice from someone experienced in the process who can help claimants understand it.”