With these words the Government explained the basis for increasing Court fees:
“The case for revisiting the way we charge court fees is based firmly on the need to ensure that Her Majesty’s Court and Tribunal Service (“HMCTS”) is funded properly to protect the vital principle of access to justice.”
Readers will be forgiven for thinking this was taken from the Government’s August 2021 response to the Spring 2021 Court Fees Consultation. In fact this sentence appears in the August 2015 response to another consultation about increasing Court fees. Some will recall that following the 2015 review fees were increased in 2016 and which followed the introduction of so-called Enhanced Fees in March 2015. Each fee increase was and continues to be based upon the same rationale.
I do not propose to revisit the many excellent and sound arguments for not increasing Court fees, ably made by practitioners, representative bodies and the specialist associations. Those arguments are done and dusted, again.
Instead, in this month’s column, I consider a novel difference from previous fee increases. On the occasion of every previous fee review those increases were based on a relatively stable understanding of the number of cases being issued across all jurisdictions and the “growing costs” of servicing those case volumes; see para 4 of the August 2021 Response at https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1014021/6.7670_Court_and_Tribunal_Fees_inflationary_increases_consultation_response_13_Aug_FINAL_230821__002_.pdf).
The biggest jurisdiction by volume of cases is civil money claims. The volume of claims issued there ranges from 1.7m to 2.1m every year with the actual number each year dependent on the state of the economy. The fee receipts from that jurisdiction (mainly County Court cases) cross-subsidising the running of lower volume jurisdictions.
In the 2021 fee review no account appears to have been taken of the reduction of fee receipts arising from another policy being pursued with equal vigour by the Ministry of Justice (MoJ) namely the completion of Lord Woolf’s project to move the action in civil litigation from trial to pre-action.
Endorsed and encouraged by all four members of the senior Judiciary, their July 2021 Call for Evidence about Dispute Resolution in England and Wales makes for a most insidious paradox (apologies to W S Gilbert).
This shift from trial to Pre-Action is explained in the opening paragraph of the Call (p. 4) which is available at – https://www.gov.uk/government/consultations/dispute-resolution-in-england-and-wales-call-for-evidence. I believe this paradox has not been fully appreciated or its implications understood by policy-makers at the MoJ. Or perhaps they have just put off absorbing the implications of this fundamental shift away from disputants paying Court fees until the next fees review in ca 2027?
Of course the latest review was set in train before the Call for Evidence was published (July 2021) and it may be a few months before the outcomes of the Call begin to translate into change but let there be no doubt change is coming, and at pace. The postponement of the deadline for responses to the Call from 30 September to 31 October should encourage none to believe the recent, rapid pace of reform is slowing, far from it.
The object of all fee increases is to raise more money to finance the running of the Courts and Tribunals. This will be increasingly scuppered by the modern approach to dispute resolution which is to put resolution not confrontation at the heart of civil justice. In practice this envisages the Woolf Pre-Action project being front and centre in civil justice for the rest of this century. There will be no going back and the Call for Evidence envisages far fewer cases being issued and therefore far lower fee receipts from issuing cases, interlocutory applications and hearings.
The biggest “growing cost” for MoJ is of course people with their salary reviews. Not much progress has been achieved in fulfilling the agreement that was reached with HM Treasury in 2015 to reduce headcount at the MoJ by roughly one-third or ca 5,000 personnel. The effect of the latest direction of travel as set out in the Call for Evidence will surely only hasten the reduction of staff as cases reduce in line with the shift to a massive increase in the number of cases settling in Pre-Action, one way or another.
As court fees rise to compensate for reduced fee receipts those court users in lower and middle income brackets will only find in ever higher fees further incentive to settle in pre-action. Those users of the Commercial Court and other jurisdictions in the Business and Property Courts (the BPC) (both in London and the regional centres) will be unaffected by these considerations. However fee receipts from the BPC are hardly likely to help keep the MoJ afloat as case starts in the BPC only amount to ca 30,000 cases each year.
To conclude: a most insidious (and until now invisible) paradox arises from this clash of policies: fees increase but receipts reduce because the action in litigation is in Pre-Action.
Having murdered, by my poor literary appropriation, one of W S Gilbert’s most amusing phrases it seems only fair that I end with these strikingly context-appropriate (and unaltered!) lines from The Pirates of Penzance:
“How quaint the ways of Paradox!
At common sense she gaily mocks…”
Ah, the world of civil justice reform…
Tony Guise is the Director of DisputesEfiling.com the specialist provider of ADR management platforms. He is a Past President of the London Solicitors Litigation Association and former member of the Civil Justice Committee of the Law Society of England and Wales.