Will small claims change be a big improvement?
I qualified as a solicitor in 1981. Since then I have acted in legal proceedings for debt recovery for small and large businesses who have delivered goods or provided services to customers without having received payment. In most cases there is no dispute the goods were delivered, or that the services were provided, and were satisfactory. The only problem is that the other party, for whatever reason, has not paid.
In 1981, procedures available were fairly straightforward. An action for £500 or less was a summary cause. All other actions were called ordinary actions, and were more formal. In 1988 small claims were introduced in addition to summary causes and ordinary actions. The limits for small claims and summary causes increased over the years and, latterly, were up to £3,000 for small claims and £5,000 for summary causes. There was almost no difference between small claim procedure and summary cause procedure.
In 2009, Lord Gill’s Scottish Civil Courts Review recommended small claims and summary causes be replaced by a single form of procedure, designed with the interests of unrepresented litigants in mind. The vast majority of small claims and summary causes were, in fact, dealt with by solicitors on behalf of their clients and most actions were not defended. On 29 November 2016 simple procedure was introduced, and must be used for debt actions up to £5,000.
The Scottish Civil Justice Council’s Access to Justice Committee was responsible for creating the new simple procedure rules. The committee decided to update obscure terminology. The party who raises the action is called the claimant rather than the pursuer. The other party is called the respondent rather than the defender. The document by which the procedure is instigated is called a claim form rather than a summons. Are these new terms any better?
The claim form itself is a lengthy 11 pages. It is designed to be completed online, with the lay litigant in mind. It contains more guidance and explanatory material than the forms it replaced. Is the new form an improvement?
A small claim summons was a relatively straightforward document, normally no more than two pages. A quick glance at the front page of the summons would tell you where the action was raised, who the parties were, and how much money was sought by the pursuer from the defender. The simple procedure claim form is more difficult to digest. The name of the claimant is on page 1. The name of the respondent is on page 3. The amount sought by the claimant is on page 7. The name of the court does not appear anywhere.
The form assumes all simple claims will be defended. Parties are encouraged to settle disputes by negotiation where possible, and require to set out the steps they have taken to settle, although the majority of actions will not be defended as there is no dispute. Parties also require to list the witnesses they will bring to a hearing, although the majority of cases will have no hearing.
Sheriffs, who will require to decide contested actions, are given wide-ranging powers. They can decide a case without a hearing. But will sheriffs be given time to consider the case properly so that they can decide a case without a hearing? If the sheriff is to reach a decision without a hearing, parties are likely to be expected to set out their case in detail. Will the new simple procedure form allow that to be done?
In a defended small claim the amount of expenses a successful party can recover is normally restricted to 10 per cent of the sum sued for, or £150, whichever is the higher. This rule is particularly unfair when a party paid £78 to raise the action. The fee for a simple claim is £100 (unless the sum claimed is £200 or less). Will the rules be changed to allow a successful party in a defended action to recover a more realistic proportion of his costs?
The Access to Justice Committee hopes simple procedure will be successful. They will monitor the implementation of the rules and consider the views of court staff, litigators and the public who use the new procedure. I think there is room for improvement.
Alan Jones is a Court Partner in Russel + Aitken LLP