“As you were”, No change in the small claims limit

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Personal injury solicitors around the country heaved a big sigh of relief when the Ministry of Justice decided not to increase (for the minute) the small claims limit on the 23rd October 2013.

What does the current law say?

At the moment, if a Claimant’s personal injury claim is worth in excess of £1,000 their solicitor will be able to recover his or her costs from the opponent, if they are successful. If a claim is worth less than £1,000, then only fixed costs of £70 are recoverable. This means that Claimants with claims worth less than £1,000 have found that it is often not cost effective to instruct a solicitor to act on their behalf.

What would the proposed changes have meant?

The Ministry of Justice has long been considering the increase of the small claims limit from £1,000 to £5,000 or even £15,000 which was mentioned by Justice Secretary Chris Grayling at one point.

This would have meant that the vast majority of personal injury Claimants would have been denied the opportunity of pursuing a claim unless they were prepared to fund it themselves. This would have involved either an upfront payment of fees or a deduction from any damages recovered.

However in cases worth £1000-£3000 it may not been cost effective to pursue the claim thus leaving those who have been injured through no fault of their own without recourse to any compensation.

“A victory for common sense”

Law Society chief executive Desmond Hudson hailed the Ministry of Justice decision to heed the warnings of the transport select committee and maintain the small claims limit at its current level for personal injuries as “good news for accident victims and a victory for common sense”. “It reduces the risk of people with real injuries being fobbed off with less than they are entitled to,” he said.

Anne Thomson, Head of Travel Law at Farnworth Rose Solicitors, said: “No matter whether a client’s claim is worth £1,000 or £10,000 they should have the opportunity to instruct a specialist solicitor to act on their behalf.

“If the small claims limit had increased then in many cases we would have had to turn clients away. Unless they were in a position to finance a claim themselves it would not have been cost effective for us to become involved. Many innocent, injured clients would have been denied access to justice.â?