A basic guide to Litigation

16 Sep 2009

Much has been said about the ‘compensation culture’ which has developed over recent years in this country and that we are becoming more and more like the USA where people are much more assertive about their rights and will not hesitate to sue if they think that their rights are being abused.

In 1999 Lord Wolf introduced the “Access to Justice” reforms which brought about the complete revision to the entire civil justice system in this country since 1875. In referring to the ‘civil justice system’ I am referring only to the County Courts and the High Courts; the ‘criminal justice system’ on the other hand has its own courts, namely, the Magistrates and the Crown Courts; there are also a number of other forums which fall outside the reforms such as the Employment Tribunal and the Ombudsman which are governed by their own procedures.

The purpose of the reforms as its title suggested was to do away with the shroud of mysticism which surrounded the law and to encourage people to access the courts directly. Lord Wolf completely modernised the language of the law replacing words like “Writ” with “Claim Form”; “Plaintiff” with “Claimant” and “Tomlin Orders” with “Consent Orders”. A real attempt had finally been made to do away with the stuffy and pompous image which unfortunately had been built up over many years by the lawyers themselves. It is the legal jargon itself which often confuses people and enables lawyers to hold a monopoly over the law. Law and justice ought not to be that complicated or distant. Lord Wolf recognised this and in his reforms, procedures were simplified and streamlined and rather than having to rely on laws and procedures which had been built up over many years of practice in a piece meal fashion and by case law, the whole civil justice system was neatly and concisely summed up in the Parts of the Civil Procedure Rules (CPR). People can now simply pop in to their local County Court and fill in a simple Part 7 Claim Form claiming anything from breach of contract, an unpaid debt, negligence, nuisance or personal injury without having to feel obliged to engage solicitors or barristers. You can now log on to ‘money-claim-online’ and issue court proceedings over the internet for unpaid invoices. We now have electronic filing and management of documents in court and telephone hearings. Things have come a long way since Dickens’ Jarndice and Jarndice although some would argue that there is still a long way to go.

Under the current regime brought about by the reforms, claims are now categorised in three types: small claims (claims below £5,000 and £1,000 for personal injury cases); fast track (claims between £5,000 and £15,000) and multi-track (claims over £15,000). Multi-track cases can be started in the High Court and any claim worth £50,000 or more must be started in the High Court. In the old days, you could start any value claim in the High Court. During my days as an outdoor clerk in London, I remember often going down to the High Court to issue batches of ‘Writs’; often, many of these would just be issued as threats with no intention of embarking on lengthy and expensive court proceedings. Nowadays this is simply not done. If you sue someone, you’d better make sure you have a good case or there will be costs consequences! This is because in the old days it was the claimant’s (or rather the plaintiff’s) responsibility to run the case. This is not so under the new CPR. Under the new regime, the judge runs the case and sets the timetable, not you. I have found that some of the more proactive judges would not hesitate to phone me up out of the blue to discuss the progress of a particular case; something which was unheard of before the reforms.

Although as a general rule, in ‘small claims’ no solicitors costs are allowed, the court can nevertheless award costs if it thinks that a party to the proceedings has acted unreasonably or in bad faith. The courts do not take kindly to having their time and resources wasted by someone who wants to play games. Indeed, since the reforms were introduced, ‘Pre-Action Protocols’ have been developed which provide guidance to both claimants and defendants alike as to what needs to be done before a particular type of court claim is launched. Failure to adhere to those protocols could result in adverse costs consequences. So, in a sense the ‘access to justice’ vision has been watered down somewhat by the introduction of these new protocols or at least it is delayed in order to provide some time for careful consideration of one’s case.

Generally speaking, you have 6 years to sue someone or you will be time barred. For personal injury actions, the time limit is 3 years; this can be a tight deadline because sometimes, the effects of an injury do not come to light until long time after the accident and so careful consideration needs to be given early on as to whether or not you intend to sue. Another common misconception which has brought about the label “compensation culture” is that you are entitled to compensation merely because you have had an accident or suffered some sort of injustice. Don’t believe the hype is my advice. No one is just going to hand over a cheque without a fight! If you are going to sue someone, you need to be able to show with some certainty that they have done something wrong to you – whether it is a contract which they have not honoured or a duty of care which they failed to provide. In addition, you will need to be able to show that as a result of this negligent or unlawful act or omission that you have suffered loss. If you sue someone for breach of contract or in tort but you have actually suffered no loss as a result of such breach, you could well end up with a Piric Victory (from the Roman General ‘Pirus’ who lost the war for the sake of winning a battle). We have all heard and read about those high profile cases where a tabloid newspaper is ordered to print an apology and pay £1 in damages to the celebrity Claimant for some untrue story but with the celebrity picking up the bill for millions of pounds in wasted legal costs. Despite the good intentions of the reforms, litigation remains fraught with all sorts of pitfalls and difficulties which is why sound and professional advice is indispensable.

So once you have complied with all the pre-action protocols and issued your Claim Form in the Court, then what? Do we all then thrash it out in a Rumpole of the Bailey style hearing? Hardly. The hearing is usually many months away if not years. You can’t just turn up to a hearing and conduct ‘trial by ambush’. Every shred of evidence upon which you intend to rely on at trial will have to be disclosed well in advance and indeed well before witness statements are exchanged. It is the intervening period between the issue of the claim and trial itself where most of the hard work is done. The trial is just the ‘show down’; the final act to a long fought out battle or as some solicitors might grumble, is where the barristers’ get all of the limelight for the solicitors’ hard work leading up to that point. It is during the period leading up to this point, where the case gets first examined and dissected; where applications and cross applications are made for extensions of time, for further evidence or information to be provided, for experts to prepare reports on matters requiring expert evidence etc. Most claims are either abandoned or settled at this stage because the closer a case gets to trial the more costly things become and the more risky the outcome is likely to be. The costs of the trial will often double the costs of the action as a whole and you just never know how it might be decided on the day or how a witness will perform for you. One Judge may see things entirely differently to another; a bit like a referee on a football pitch. The emotional rollercoaster ride of litigation is like no other and it can cripple you financially and permanently if you lose. The general rule is that if you lose, you end up paying not only all of your own costs but most of those of the other side as well. This is why before embarking on any litigation, it is absolutely crucial to know how it is going to be funded what ever the outcome; no win no fee agreements and legal costs insurance policies for instance.

You also need to consider what will happen if you win the case. Sometimes, winning a case is just the beginning of your troubles, for instance – what if the defendant doesn’t have enough money to meet the award? If the defendant is a limited company in particular, it might not have any assets and the liability of its directors are limited by the very nature of the ‘limited liability company’. This brings us back to the victory of Pirus! And what about where the defendant does have the assets to meet the award but still refuses to do so. You will then have to start another set of proceedings namely ‘enforcement proceedings’ in order to recover your money – you might be able to send in the bailiffs or apply for an order of sale of property. These are all things which need to be considered at the outset because once you have started a claim it is not always easy to extract yourself and certainly not without costs consequences. Other considerations are whether the defendant carries appropriate insurance; are there any other avenues you can pursue apart from litigation such as alternative dispute resolution; mediation; Ombudsman proceedings; Tribunal proceedings; bankruptcy or insolvency proceedings?

Statistically, there is no question that we are becoming more and more litigious and indeed the reforms which continue to be made encourage us to be so. However, the word of caution is that litigation is not to be taken lightly. It can be costly; it is always stressful and there is no such thing as an open and shut case! Before considering litigation, come and see us first for a free consultation, whether or not you then decide to do it yourself or instruct someone else or ourselves to do it on your behalf. It pays to make an informed decision at the outset.

For a general opinion on the merits and the costs of your case without obligation, please email Marco Dellapina or call on 01565 634 100 or you can simply visit our office at Caledonian House, Tatton Street, Knutsford, Cheshire, WA16 6AG.

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Category: Litigation, Services

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