This time last year, we were reeling from Jackson LJ’s proposal to extend fixed recoverable costs across all types of cases under £250,000; which, he said in his speech to the IPA in January 2016, could be implemented by the end of 2016, if the political will was there. Perhaps unsurprisingly, given last year’s events, the political will appeared to be (at least temporarily) elsewhere. But what might the future hold for litigation?
The only certainty is that things will change. In September 2016, the Lord Chancellor, Lord Chief Justice and the Senior President of Tribunals (their Lordships) published 'Transforming Our Justice System', a paper setting out the Government and the judiciary’s shared vision for change. The introduction states that they have the will and the means (£700 million) and the 'shared commitment' to make this vision a reality.
The overall aim is clear: a courts and tribunal system that is just, proportionate and accessible to everyone (page 3 of the 'Transforming Justice' paper). These three core principles will underpin the transformation of our justice system.
Their Lordships characterise a just system in several ways. Firstly, that judicial decisions and outcomes of cases should be regarded as just by all parties. Secondly, that the judiciary is supported by modern, consistent and transparent processes. Thirdly, the judiciary and the legal profession should be drawn from the widest possible pool of talent, including women, BAME candidates and those from a socially disadvantaged background.
Not much to quibble with there, although there is little in the way of detail as to how these outcomes are going to be achieved or what the processes might look like. Neither are the proposals in the Ministry of Justice’s summary of reforms and consultation document, published at the same time, any more detailed.
A proportionate system will save parties time and money and reduce the impact of legal proceedings on their lives. Disputes should be resolved out of court where possible, and their 'unnecessary escalation' should be 'emphatically discouraged' (page 5). The Civil Procedure Rules already require that litigation should be viewed as a last resort (paragraph 8, Practice Direction on Pre-Action Conduct and Protocols).
We are further reminded that the cost, speed ‘and complexity’ should be proportionate to the scale and substance of the case. It is assumed that the complexity relates to the system itself. While there is little doubt that cost and speed can be managed with an eye on proportionality, it is harder to see how it is within any party’s gift to control the innate complexity of a dispute (beyond refraining from intentionally exacerbating it).
So how might justice be delivered in a proportionate way? Their Lordships suggest that procedures will be made simpler and more user-friendly in 'day to day, straight forward cases' (page 5). While most stakeholders would welcome procedural simplification, why differentiate on the basis of complexity? Who will assess whether or not a case is straightforward, and how? What if the parties don’t agree?
Suggestions to make the justice system accessible include streamlining the court structure, and making procedures and remedies available and intelligible to non-lawyers in clear language. Measures will be taken to ensure that people with disabilities and people who are not comfortable with new technology are not excluded. The consultation also notes that the new system must also ensure open justice (paragraph 1.8(ii)).
Very little is said about our justice system being accessible to all, whatever their financial means.
Their Lordships suggest a move away from the adversarial, courtroom based approach. For civil cases, this will involve ‘new, often less combative methods’ (page 6). It will be interesting to see which 'new' methods their Lordships have in mind, and/or whether we will see a formalisation of the CPR’s increasing fondness for mediation, early neutral evaluation etc. Either way, litigators need to ensure that they have several, recently tuned, strings to their dispute resolution bow.
The reform programme 'assumes a wholesale shift to accessing justice digitally' (page 7). A single online system will be introduced to allow criminal, civil, family and tribunal cases to be started and managed online. This will be supported by robust document and case management systems, to replace the paper filing systems currently in use. There will be a structured system of online pleading, and greater use of virtual hearings throughout all jurisdictions.
The aim is for more and more cases to be carried out either wholly or partly virtually or online. Ultimately, all cases are to be started online, whether or not they are scheduled for online or court based resolutions. Equally, some cases will be completed entirely online – for example, lower value debt and damages claims.
All of which sounds great, as long as the technology on which these new systems are based is stable, compatible with other operating systems, and future proof. A workable alternative must also be available to those without the technological know-how. A cynic might also mention that government IT projects do not have an unblemished record of success… How will the system and its users cope with routine outages and hard and software failures? How can we ensure our system remains accessible to all if there is a longer term or recurring technical problem?
Their Lordships’ ambition for the civil courts is that they 'retain and enhance their world-class position as the trusted jurisdiction of choice for international disputes, while becoming easier to use for everyone, and more proportionate in resolving simpler legal disputes' (page 11, emphasis added). It is not as yet clear what the practical consequences of that little word 'simpler' might be.
The reforms to the civil courts will move away from 'combative hearings', offering instead a number of options: dispassionate evaluation, followed by negotiation, conciliation, mediation or a tailored, issues based hearing. The aim is to reduce time, costs, stress and acrimony, be it for individuals or multi-national corporations. Cases may be resolved on paper, on-line, or face to face, depending on the complexity of the case and the needs of all involved. Digital working will help speed up the whole process (in theory, at least).
Perhaps the most eye-catching and 'SMART' objective is their Lordships’ commitment to 'automate and digitise the entire process of civil money claims by 2020' (page 11). Civil money claims are largely (83%) uncontested, and equate to more than 80% of the county and High Courts’ caseload, so the logic and commensurate benefit is evident. However, even the optimistic Lord Briggs acknowledged in his Review (on which these reforms are partly based) that this deadline was 'a real challenge' (paragraph 6.46). Time will tell.
Unsurprisingly, their Lordships believe that costs need to be better controlled so that they are proportionate to the case, and more certain from the outset. Fixed recoverable costs (FRC) are intended to protect losing parties from disproportionately high costs, and allow people to make more informed decisions about whether to take or defend legal action. The MoJ agrees. FRC 'provide transparency and certainty for all parties and are designed to ensure that the amount of legal work done is proportionate to the value of the claim. We are keen to extend the fixed recoverable costs regime to as many civil cases as possible' (paragraph 3.1(iii)).
Proportionality of costs is a laudable aim, although quite what constitutes proportionate costs or recovery remains the million dollar (fixed for certainty) question. Nobody should be put off bringing a just claim, or running a justified defence, because of their potential liability for costs. (Nor indeed because of excessively high court fees, but that ship has long since sailed.) FRC give parties certainty as to their liability for their opponent’s costs; but they will instead have to cover a larger proportion of their own costs, even if they win. Does this really make costs any more certain or proportionate? Will it not simply make many cases not worth the financial candle, effectively depriving people of access to justice?
Blunt tool or not, the significant extension of FRC appears inevitable. The senior judiciary has commissioned Jackson LJ (whose views are well-known) to develop proposals for extending the current regime and to consider the types and the areas of litigation to which it should apply. In his invitation for written evidence and submissions, he noted that ’the momentum is heavily for reform’, although he also made clear that there is ample scope for practitioners, court users and other interested parties to feed into the review before he reports back to the senior judiciary in July 2017.
Their Lordships acknowledge that the proposed reforms will have a major impact on our work. To move with the times lawyers will need to innovate: 'to find new ways of delivering services, of simplifying working practices, of focusing more on meeting the needs of all their clients, from defendants to families and civil claimants. Much is already being done… but the reforms will enable them to be much more ambitious' (page 7). The ball will soon be in our (virtual/online) court.
This article was published in Commercial Litigation Journal in February 2017.