The new fees are based on 5{0a6a65c996ed4169444354e707b897cdb00dbefc1d0429e8febb9bf11027ba53} of the claim’s value for all claims over £10,000 and could lead to an increase in costs by more than 600{0a6a65c996ed4169444354e707b897cdb00dbefc1d0429e8febb9bf11027ba53} for high value cases.
Law firm Bond Dickinson believes that the increased fees “will ultimately be passed on to defendants and their insurers which are likely to put some pressure on claim values, reserves and ultimately premiums.”
The Government’s proposals were set out in its response to its Consultation on Court fees and were introduced earlier than expected on 9 March 2015 according to The Law Society. The new fees, which are expected to raise an additional £120m for the court system, had been expected to start before the beginning of 2015/16 Parliamentary session.
Senior judges have expressed deep concern about the reforms, which they believe will disproportionately affect small and medium enterprises and litigants in person bringing claims. The Lord Chief Justice also warned that the “increase in fees could trigger commercial work moving elsewhere.” In his response to consultation he said that the fees proposed are 25 to 100 times greater than those payable in New York.
“The costs of defending larger professional indemnity claims in court will inevitably rise as a result of these new fees, which is likely to have a knock-on effect on some premiums,” said James Burgoyne, Director, Claims & Technical, Brunel Professional Risks. “We will work closely with our clients to identify the most appropriate and cost-effective cover from across the whole open insurance market to minimise any potential increases.”
Articles about the new fees have been published by The Law Society, Law Society Gazette and Solicitors Journal.
