The small claims track is governed by Part 27 of the Civil Procedure Rules.

When will a claim be allocated to the small claims track?

After a defence to a claim is sent to the Court, the parties to the claim will be sent an allocation questionnaire by the Court. Using this form, the parties will inform the Court of certain facts about the claim, including how many witnesses they intend to rely on, whether they intend to rely on expert evidence and how long the trial of the claim is likely to take. Using this information, along with the value of the claim as set out on the claim form, the Court will allocate the case to the appropriate track.

As a general rule, a case will be allocated to the small claims track when it has a value of not more than £5000. The exceptions to this rule are;

•(a) In personal injury cases, the claim will only be allocated to the small claims track if the value of the claim as a whole is not more than £5000 and the value of any claim for damages for personal injuries is not more than £1000; and

•(b) Claims by tenants against landlords for an order that the landlord carry out repairs will only be allocated to the small claims track if the estimated value of the repairs is not more than £1000 and the value of any other claim for damages is not more than £1000.

However, courts will also consider other facts in deciding what track to allocate a claim to, including its complexity, the number of parties, the amount of evidence required and the importance of the claim to the general public.

Accordingly, a straightforward claim following the breakdown of an agreement between two parties, with a financial value of less than £5000, will most likely be allocated to the small claims track.

How does the small claims track work?

The small claims track is designed to be quick and relatively uncomplicated. Accordingly, upon allocation to the small claims track, the Court will typically send to the parties a Notice of Allocation to the Small Claims Track. This notice will be endorsed with; a hearing date for the trial, an estimated trial length and details of the court at which the trial will take place.

The estimated trial length will usually only be a maximum of 2 or 3 hours. If longer than this is required to hear the case, it is likely that the case is too complicated/has too many witnesses to be properly dealt with on the small claims track.

The notice will often include a note that the judge who has allocated the case considers the case suitable for mediation. This is an alternative to trial that is often faster and cheaper, and is suitable for cases where the parties may be able to resolve their dispute relatively amicably. If the Judge does consider that this may be appropriate, he will direct the parties to contact the Mediation service and will provide their contact details.

The notice will also include directions; that is, the steps the parties must take in order to prepare their case for trial. It is very important that these directions are followed. Failure to do so may result in a party’s case being struck out or in the trial being delayed, with the party who has failed to comply with the direction being made to pay the costs caused to the other party by the delay.

Ordinarily, the directions the Judge will include on the notice will be standard directions. These are;

1. Each party must deliver to every other party and to the court office copies of all documents on which they intend to rely at the hearing no later than 14 days before the hearing. (This includes Witness Statements)
2. The original documents must be brought to the hearing.
3. No party may rely at the hearing on any report from an expert unless express permission has been granted by the Court beforehand. Anyone wishing to rely on an expert must write to the Court immediately upon receipt of this Order and seek permission, giving an explanation why the assistance of an expert is necessary.

The notice will also remind the parties that if they are able to settle the claim, which is encouraged, they must notify the Court as soon as possible.

Witness Statements

Witness Statements are among the documents that must be sent to the Court and to all other parties by no later than 14 days before the hearing. These documents are vital, as they are used, effectively, as the witness’ evidence in chief; other than to answer questions put by the Judge or another party, or to elaborate on something in the statement, the witness will not ordinarily be allowed to speak at the hearing.

If a witness attends a hearing without first filing a witness statement, it is likely that the Court will not hear the evidence of that witness. A party wishing to rely on the evidence of a witness who has not filed a statement may end up having to request that the case is adjourned, put off to another date, and may have to pay the other party’s costs of the adjournment.

The witness statement should clearly set out everything the witness believes is relevant to the case. The statement must include a Statement of Truth, confirmation that the maker of the statement believes the statement is true, and be signed by the person making the statement. A witness will be in contempt of court if they have knowingly made a false witness statement, verified by a statement of truth.

Witnesses must, in addition to filing statements, also attend Court for the trial. If they fail to do so, the Court may still take their statement into account, however, it may be given less weight by the Judge when he comes to make his decision.

The Trial

Whilst often taking place in Judge’s Chambers, small claims trials are open to the public. Whether or not the trial will follow the usual format is up to the Judge, as it may not always be the most effective approach in cases where parties are, for example, unrepresented. That being said, it is useful to expect the trial will follow the ordinary format, which is as follows;

1. Claimant’s opening speech, wherein the case is summarised
2. Claimant’s witness evidence in chief
3. Defendant’s cross-examination of the Claimant’s witnesses
4. Claimant’s re-examination of their witnesses
5. Defendant’s witness evidence in chief
6. Claimant’s cross-examination of the Defendant’s witnesses
7. Defendant’s re-examination of their witnesses
8. Defendant’s closing speech
9. Claimant’s closing speech

Please note that any of the above steps may be omitted, the Judge may step in with questions at any time, and the evidence in chief parts will usually be dealt with simply by the witness confirming that the statement they have filed with the Court was prepared by them and is true.

After the conclusion of the trial, the Judge will give his fully reasoned judgment.

Costs

The small claims track does not limit the use of legal professionals by either party, either in providing advice, preparing documents or representing them at trial. However, the Court may only award very limited costs unless the paying party has behaved unreasonably throughout the course of the proceedings. Unreasonable behaviour is not easy to demonstrate and is not exactly defined, but could, for example, include circumstances where a party files a defence but then fails to file any other evidence or to attend the hearing. This will be argument for the successful party to make to the Judge.

The Court may order that the winning party’s witness expenses are paid, that any court fees are reimbursed, and that expert fees (where permission has been given and limited to £200) be paid, but that only fixed costs be paid in respect of solicitor’s costs. In a claim worth between £1000 and £5000, this will be £80.

Despite the relatively straightforward nature of a small claim, a fair amount of time can be involved in preparing pleadings (particulars of claim/defences) and witness statements, not to mention corresponding with the Court and with other parties, or the actual attendance at Court for the hearing. Cases will often be ‘block-listed’ which could involve quite a bit of waiting on the day of the hearing. Given that solicitors charge hourly rates, the costs of a small claim will always exceed £80, usually by a very significant margin.

The same rule applies to Claimants and Defendants. As such, parties should consider very carefully whether they want to instruct a solicitor in respect of a small claim, when there is a risk that the costs of the claim may eclipse the amount they are claiming, or, in the case of a Defendant, seeking to avoid paying.

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In this case, the Claimant had waited for over five years before instructing solicitors to pursue a number of claims against various defendants arising out of a purchase of land. The claim against two of the Defendants, and estate agent and the firm for which he worked, was for professional negligence and the claim form was issued on 12 November 2012. It was served on 12 March 2013, by which point the solicitors acting for the Claimant should also have served Particulars of Claim. However, the solicitors had mistakenly believed they had another 14 days to serve the Particulars of Claim, with the effect that, in order to be allowed to serve the Particulars of Claim and pursue its claim, the Claimant would now require from the Court permission to extend time for service of the Particulars of Claim.

This was opposed by the two Defendants mentioned above because, due to the time taken for the Claimants to bring the claim, the Claimant would now be time barred from bringing fresh proceedings; in effect, if the application for an extension of time was refused, the Claimants would be unable to pursue these two Defendants now or in the future.

The application was considered in light of several new provisions to the Civil Procedure Rules, which require that the Court now take a much stronger and less tolerant approach to failures to comply with matters such as time limits.

The Judge considered various factors set out under CPR 3.9 (factors to consider when considering whether or not grant relief from sanctions), including; the interests of the administration of justice; whether the application for relief had been made promptly; whether the failure to comply was unintentional; whether there was a good reason for the failure; compliance with other rules; whether the failure to comply was caused by the party or his legal representative, and; the effect the failure had on each party.

He found the following;

1. The wholly unexplained delay in issuing proceedings was relevant, and, in general, it was not satisfactory or in the interests of justice to have claims brought in the closing weeks or months of a long limitation period. He found that, ‘the Court should adopt a stricter approach where a Claimant has, seemingly through its own choosing, left the start of proceedings until the last minute;’
2. The reason for the failure to comply with the time limit was a misreading of the rule by the Claimant’s solicitors;
3. The consequence of refusing to grant relief for the Claimant was the loss of a right to pursue the Defendants for all time, as against the consequence of granting relief for the Defendants, which amounted to the loss of an accrued limitation defence, with the result that ‘a professional man would have to endure having a claim hang over his head for much longer than would have been the case if the Claimant had pursued its case promptly and complied with the rules.’

The Judge found that, on balance, these factors were finely balanced in this case, and, all things being equal, he would have difficulty in seeing how it would be just or proportionate to allow a short delay to prevent the Claimant from pursing its claim against the Defendants.

However, the Judge found that, particularly in light of stricter approach that must now be taken by the Courts against those that fail to comply with the rules, permission to extend time should be refused because of;

1. The complete absence of an explanation for the delay in commencing proceedings;
2. The relative weakness of the Claimant’s claim against the Defendants, and;
3. The fact that part of the claim was only pleaded in vague terms.

Whilst the claim was not disallowed due the delay (and, so long as it was brought within the limitation period of six years, it could not have been), the fact of the delay likely caused the Court to adopt a stricter approach than it would have done if the claim had been brought at the earliest opportunity, or if a good reason for the delay had been advanced.

The case also underlines the new, less tolerant approach the Court will take to delays and failures to comply with rules, Order and time limits, following the Jackson report. Whilst this will certainly be true where solicitors are instructed, it is understood that Courts will adopt a similar position where litigants are in person; as such, care should be taken by litigants in person that rules and time limits are understood and complied with.

This article is for general information only and is not legal advice. Professional advice should be taken before taking action. No liability can be accepted for any action taken or not taken as a result of this information.

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Stage 1: Commencing a claim

In most cases the parties should take steps to try and resolve their dispute before a claim is commenced at court. Once those steps have been followed then a claim may proceed at court by issuing proceedings and paying the appropriate court fee. A claim is issued by lodging with the Court the claim form and particulars of claim, setting out the Claimant’s case. These documents must be served on the Defendant within four months of the claim being issued.

The defendant usually has 14 days to acknowledge receipt of the claim form and particulars of claim. If they file an acknowledgment they will have 28 days in which to file and serve a defence.

Stage 2: Allocation & Directions

Shortly after the defence has been filed and served the parties will need to complete Allocation Questionnaires and send these to the Court. The information in the Allocation Questionnaires will enable the judge to decide how the court’s resources should be used by allocating the claim to either the Small Claims Track; the Fast Track or the Multi Track. The Judge will also make an order setting out what steps need to be followed to bring the case to trial; these are known as Directions.

In more complex cases the Court may list a case management hearing to take place in order to consider what the issues in dispute are and consequently what Directions should be made.

Stage 3: Disclosure

The Court will order the parties to disclose relevant documents to each other at the disclosure stage. This usually takes place around 4 weeks after the case has been allocated.

Each party must carry out a thorough search of all documents that are relevant to the Claim, even if those documents are harmful to that party’s case. The search should include electronic documents. This is a very important part of the litigation process and there is a high duty on each side to ensure that it is carried out properly. There may be sanctions against a party who does not carry out this process properly and therefore legal advice should be obtained.

Once the search has been carried out then each party should set out on a List of Documents the description of all documents that are relevant to the claim that are either in the party’s possession or control or were once in that party’s possession or control. The List must be supported by a signed Statement of Truth.

Each party usually has 7 days from being served with the List of Documents to ask to inspect those documents referred to.

Stage 4: Witness Statements

About 6 weeks after disclosure has been completed, the parties will usually exchange witness statements. These statements should set out the facts as the witness honestly believes them. The statement is the evidence-in-chief of that witness. A party cannot usually call a witness to trial to give evidence unless their statement has been disclosed to the other side at the appropriate time.

The statement will need to be signed with a supporting statement of truth.

Stage 5: Trial

Preparing for Trial

Each party will need to complete and lodge a pre-trial checklist with the Court. The pre-trial checklist will confirm whether all Directions have been complied with and whether further Directions are required. It will also confirm the availability of witnesses and legal representatives which will enable the court to set a trial date, if it has not already done so. An estimate of costs and trial timetable are usually included within the checklist. A case summary may also need to be prepared.

If a barrister is instructed to represent you at the trial then a brief to counsel will need to be prepared. It may also be necessary to have a number of case discussions with counsel, known as “conferences”.

Between 3 – 7 days before the trial date the Claimant will need to file and serve a trial bundle. The trial bundle will contain key documents such as the claim form, particulars of claim, defence, disclosure documents with List of Documents, witness statements and court orders. The content of the bundle should be agreed with the other side wherever possible.

Trial

Depending on a number of factors such as the complexity of the case and whether Directions have been complied with on time, the trial of the matter will usually take place about 9 months after the case has been allocated. The duration of the trial also depends on a number of factors, such as the number of witnesses being called. Usually small claims track cases are listed for a half day trial; a fast track trial case may be listed for one day. A multi track case may be listed for a number of days or even weeks.

At the trial the judge will hear submissions (i.e. legal arguments) from both sides and witnesses will be called to give evidence.

At the end of the trial the judge will make a judgment. In some cases, usually those which involve complex issues, the judge will reserve judgment until a later date. The judge will also deal with the issue of costs at this stage.

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However, some claims may be run before an employment tribunal whilst an employee remains in their employment, for example unlawful deductions claims, breach of TUPE, and most notably discrimination claims, or where another employee is caused to be commented upon. It is foreseeable that in such circumstances an employer or a representative will state something which an employee may find disagreeable, for example it may justify a refusal or promotion on the grounds that an employee was not deemed to be sufficiently competent, or it may have decided not to up hold a complaint on the grounds that it found an employee to be disingenuous, etc.

In the event that such circumstances are made within the normal course of the employment, outside of the relevant procedure, or broadcast to a wider audience than was required to know such information (as an Employment Tribunal case would, given that it is open to the general public), such may be deemed to amount to a breach of Mutual Trust and Confidence and give rise to a claim for constructive dismissal. However, what happens where such statements are made in as part of the defence or supporting evidence within an Employment Tribunal?

The question was tested in Singh v Reading Borough Council.

On appeal the EAT confirmed the Tribunal’s decision that anything said during the course of a judicial proceeding, including an Employment Tribunal attracts an absolute legal privilege and as such was incapable of forming the basis of a claim. The logic behind this is that a party must be free to advance arguments in support of its defence, so long as they are honestly, genuinely and reasonably held, without fear from suffering adverse consequence, as to remove that would potentially leave parties exposed to claims and act as a limit the execution of justice. It therefore follows, that an employee cannot obtain any new claim, for example constructive dismissal, as a result of something which is said in the course of proceedings.

However, caution should be exercised and a distinction drawn when conducting such litigation. Whilst a claim for constructive dismissal may not arise as a result of anything that is said or implied before an employment tribunal, it is not to say that the provision of new evidence may in fact provide the Claimant with access to information and evidence upon which they were previously unaware regarding their treatment or as to how a decision was reached, and therefore claim Constructive Dismissal based upon such information. Further, this decision should not be viewed as a carte blanche for respondents to say what they like in the proceedings; a failure to make honest, genuine and reasonably held comments could be seen as an abuse of process, or as distinctly disingenuous which may in turn taint the Respondent’s evidence and lead to adverse conclusions been made by the Employment Tribunal. Further, deliberately and knowingly misleading a judicial body may have potential ramifications under criminal law.

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