Lawyers have reportedly recently rushed to file civil claims to beat the introduction of a new, more costly charging regime for civil courts. The new fees, which came into force on 9 March, were announced just weeks earlier and have been roundly criticised by the legal profession.
The court service now levies a fee of 5% on every civil claim that is worth over £10,000. Though this fee is capped at no higher than £10,000, it apparently led many lawyers to quickly file claims ahead of 9 March, prompted by fears that failing to file under the older, lower fees could mean that they were breaching their duty to their clients.
During the seven-week period between the announcement of the new fees and their enactment, many legal groups, including judiciary and representative groups for defendant and claimant lawyers, have reacted in condemnation.
According to the Ministry of Justice, civil courts have been suitably prepared for the new fees. A spokesperson claimed that there have been alterations “to HM Courts & Tribunals Service’s computer systems and relevant public-facing leaflets”, adding that court staff have also been briefed.
Though these charges are predicted to raise £120m annually to assist in paying for the courts service, they also mean that fees have multiplied by more than seven for claims worth £200,000.
The Law Society has launched a legal challenge to the new fees system, but this challenge is ongoing. Therefore, practitioners will, at least for the time being, have to turn to litigation funders, after-the-event insurers, or their own financial reserves to fund fresh civil claims.
Keith Etherington, Law Society council member for civil litigation, has warned that law firms are already “working in overdraft” and that costs of the new fees will ultimately be incurred by the NHS and local authorities.