Litigation

A small claim is a claim with a financial value of less than £10,000.  Such claims are dealt with under a simplified and less complex procedure than would otherwise be the case.  Usually, only very limited, fixed costs are recoverable by a successful claimant.

Claimants need to be wary when issuing a claim just above the small claims limit.  It is possible for the Defendant to make a limited and partial admission at the outset to reduce the sum in dispute below the Small Claims limit.  This may result in the claim being allocated to the small claims track by the District Judge.

Usually, costs follow the event in a litigation claim. A successful claimant or a successful defendant will usually be awarded costs. If costs are not agreed between the parties the court rules provide for an assessment process. Experience dictates that even in the best run cases, with tight control of the fees and disbursements, a successful party will usually only be awarded something like 75%-80% of the overall costs claimed. All litigators should bear that in mind and also consider whether, in the event of such an award, the opposing party has or is likely to have the means to pay.

Rejecting an appropriate offer of mediation from an opponent can have costs consequences at the court. If the court considers that the rejection of the offer was unreasonable, then even a successful party may not be awarded all or part of his or her costs. If such an offer is made and is rejected, a thorough explanation of that decision should be made at the time. There will still be a risk of costs sanctions if the court subsequently finds the refusal is unreasonable. Always bear in mind, the assessment as to whether the refusal was reasonable or not will only take place at the end of the case and thus there is always an element of risk in rejecting such an offer.