The Civil Procedure (Amendment) Rules 2013, otherwise known as ‘The Jackson Reforms’, come into force in England and Wales on 1 April 2013. One of the key effects of the reforms on debt recovery is the increase of upper limit of the value of cases which ought to be allocated to the Small Claims Track to £10,000.00.
The Small Claims Track is supposed to allow for claimants to manage the litigation without the use of a solicitor. The directions are less onerous, with more relaxed rules on evidence and disclosure, claims are brought to a final hearing more quickly, expert evidence is not generally utilised and most significantly, each party bears it’s own legal costs, even if successful. All of these factors are designed to make the Small Claims Track more user-friendly and to make it easier for parties to conduct litigation themselves, without having to incur the cost of legal representation.
Unfortunately the Jackson Reforms may not achieve this goal and may have the opposite effect. Whilst the Small Claims Track does make conducting litigation more straightforward, the process still requires legal expertise. There is still a large amount of work involved in readying a claim for the final hearing: statements of case, allocation questionnaires and witness statements all need to be drafted. Usually litigants in person do not feel confident in handling this work themselves or the relative complexity of a case requires expert input and so the litigants would wish to instruct solicitors. However the cost of instructing a solicitor and the inability to claim back legal costs often means that litigation will not be cost effective.
On the positive side the Reforms have clarified the area of debt recovery costs. The claimant is now able to add reasonable debt recovery costs to the debt. This means that Sterling Debt Recovery are able to charge our fee to the debtor, meaning that in most cases we are able to recover your entire invoice value free of charge.
Where legal action is required our hourly rates for an experienced qualified solicitor are far lower than the UK average. This means that we are able to give you a better result in litigation with lower risk of throwing good money after bad.