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PILOT PROJECT FOR A FAST TRACK SMALL CLAIMS PROCEDURE IN JERSEY

September 2001

Purpose of this paper

This paper describes a pilot project promoted by the Jersey Legal Information Board (JLIB) for the establishment of a special small claims procedure intended to provide for an accelerated process by which small claims would be resolved in a simple, inexpensive and speedy manner.  

The intention

It is intended that a pilot small claims procedure will be established in early 2002 under the existing Petty Debts Court legislation. It is anticipated that the pilot scheme will run throughout 2002, its success and effectiveness being monitored during and evaluated at the end of that period.  

Background

For some years there have been calls in Jersey for the introduction of a simplified procedure for the handling of small claims; in 1993 the Trading Standards Office put together detailed proposals for a specialist small claims tribunal to deal with commercial disputes; in 1998 the Jersey Consumer Council recommended the setting up of a small claims court to deal with disputes up to a value of £2,500; the Attorney General commissioned some research into the issues in 1999 and the Magistrate himself considered the issues further in a draft paper submitted to the Attorney General in November 1999 and a renewed paper submitted to the Bailiff in July 2001. 

In addition, the recently released Report on the Review of Tribunals in England and Wales by Sir Andrew Leggatt concluded that there is, from a wider perspective, a need to ensure that adjudicatory processes become as simple, proportionate and flexible as possible. Great emphasis is placed in the Leggatt Report on effective time and case management and the need for adjudicatory processes to be coherent and user friendly. 

The situation elsewhere

It is apparent that the need for some type of  procedure to speed up and simplify the  handling of small claims has been recognised and acted upon in other jurisdictions around the world. Mindful of the need to provide a practical means of administering justice in the service of the community the United Kingdom has already established a fast track procedure through the County Court system; the Isle of Man set up a small claims procedure as long ago as 1985 and in Singapore small claims tribunals were established, also in 1985, to deal with consumer issues. All these schemes have varying financial and other jurisdictional limits. In Singapore the procedure is essentially available to claimants in consumer disputes with a value of up to about £8,000 (indeed there is a special accelerated fast track procedure for claimants who are tourists); but in the Isle of Man the system applies to all claims whether liquidated or unliquidated up to a value of £5,000.

The existing Petty Debts Court procedures

The Petty Debts Court was originally established in the mid-nineteenth century. It currently has a jurisdictional limit of £2,500, due to be raised to £10,000 when the Petty Debts Court (Miscellaneous Provisions) (Jersey) Law 2000 comes into force. Currently, the filing of a claim with the Petty Debts Court results in the parties being called to appear before the Petty Debts Court on a Wednesday morning. If an action is defended at that time the matter is sent to proof with the result that a contested hearing will take place at an unspecified future date following the exchange of pleadings and the making of discovery between the parties. Lawyers are entitled to represent their clients in the Petty Debts Court and considerable legal costs can be incurred by the parties, especially as legal aid is not available in the majority of cases. In addition, there is no active case management policy and no mediation services are provided within the Court. According to available records there were some 5,432 Petty Debts Court actions filed in 2000. For the first nine months of 2001 4,365 cases were listed, 3,374 judgements were given and 131 cases were sent to proof.

Notwithstanding the suggestions in the recently published Review of Consumer Protection in Jersey (a Report commissioned from Mr Mark Boléat by the Industries Committee and published in July 2001), JLIB considers that the current procedures in the Petty Debts Court cannot realistically be expected to provide a speedy, user friendly and cost effective system suited to the handling of small claims in the 21st century.

The pilot project

Improvements must be made to the current Petty Debts Court procedures for dealing with small claims so as to ensure that a modern, efficient and user friendly service is in place. In a small community it is very desirable that disputes should, if possible, be settled by agreement between the parties. It is intended therefore that all claims for less than £2,500 will be referred first to mediation by a judge/mediator. Only in the event of continuing disagreement will the dispute return to the adjudicatory process. In each phase strict time limits will apply so that small claims are speedily resolved.

The authority required to implement this pilot project will be provided by Practice Direction(s) to be issued by the by virtue of Rule 21 of the Petty Debts Court Rules 1992. 

Details of the pilot project

It is anticipated that the pilot small claims procedure for Jersey will include the following:

  • actions with a financial value of up to £2,500 will qualify to be dealt with under the pilot project;

  • an action will be commenced in the usual way by issuing a summons in accordance with the current Petty Debts Court procedures;

  • when a defended case is first called before the Petty Debts Court the Magistrate will decide upon a claim’s suitability for progression through the small claims procedure and will direct the parties accordingly;

  • claims deemed suitable will be allocated for a Mediation and Directions Hearing which will take place within ten days before a nominated Relief Magistrate;

  • claims that are not allocated for progression under the pilot scheme will be dealt with in accordance with the existing Petty Debts Court procedures;

  • lawyers will not be expected to participate at the Mediation and Directions Hearing but with leave parties may be assisted by a friend; 

  • the pilot scheme will adopt a “no-costs” rule, and costs will not therefore generally be awarded in relation to the Mediation and Directions Hearing;

  • it is proposed that the Mediation and Directions Hearing will be as brief (no longer than 45 minutes) and informal as possible; the Relief Magistrate will not be bound in the Mediation Hearing by strict legal forms and technicalities. The parties will be expected to give a brief summary of the grounds of their respective cases, whereupon the Relief Magistrate will assess the merits of the arguments and will attempt to achieve a settlement by which the parties will agree to be bound. If the mediation is successful the Relief Magistrate will record the terms of the settlement on the appropriate court form which will be signed by the parties, each of whom will receive a copy;

  • any sum due under the settlement will be paid within seven days, or such other time as may be agreed and the action will be adjourned sine die;

  • the mediated settlement will remain confidential between the parties unless either party fails to comply with its terms in which case it may come back before the Magistrate for enforcement;

  • no formal judicial determination of legal rights will have taken place by virtue of the mediation process. Therefore one of the advantages of a mediated settlement to the defendant is that such an agreement will not result in the party’s name being included on any list of judgement debtors. The parties will be afforded the opportunity to negotiate openly;

  • in the event that consensus cannot be reached the Relief Magistrate will then proceed to a Directions Hearing. He will give such directions as may be required in order to prepare the case for trial including, as appropriate, orders for pleadings or for dispensing with them, orders for the mutual disclosure of documents, the exchange of expert reports and the production of court bundles and the fixing of a court date.

Resources

It is anticipated that the pilot project will be operated out of available judicial resources. However, depending on the uptake of the scheme, this issue may need revisiting.

Consultation and evaluation

The success and usefulness of the pilot project will be monitored by JLIB. A consultation process involving interested parties will be undertaken during the life of the pilot study by JLIB’s consultation project board. If, at the end of the study period the pilot project is found to be successful, it is anticipated that it will either be continued as currently proposed and/or enhanced by additional resources and legislation.

For and on behalf of the JERSEY LEGAL INFORMATION BOARD

October 2001

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