Small Claims - when ignoring the 'normal' becomes the norm!

 

Lawyers who act for tenant’s in housing conditions cases need to be aware of and to understand the rules on allocation. Special rules apply because of the difficult nature of the cases, which normally involve an application for Specific Performance – an equitable remedy.

The rule is in effect that if you have a claim for a tenant where you are seeking an order for work to be done, the case will be allocated to the fast track if the estimated cost of the work is over £1k or if less than £1k, that the value of the damages claim exceeds £1k. In fact, what the rule says is that will the normal allocation. So it is not automatic. This is leading to some very questionable allocation decisions.

Despite the clear wording of the rule many courts are allocating to the small claims track anyway. The argument is that the cases are straightforward, in fact they aren’t. Other reasons given are that the value of the repair is only above the line by a bit (!). It was reported to me in one case that the judge observed that the court was familiar with dealing with these cases.

This is all very alarming and out of step with the rule itself, the practice direction and even some comments from the Court of Appeal.

Let’s start by looking at PD16 (1) –

 (1) Where the court is to decide whether to allocate to the fast track a claim for which the normal track is the fast track, it will allocate the claim to the fast track unless it believes that it cannot be dealt with justly on that track.

 

So, 26.9 says that the fast track will be the normal allocation. The Practice direction goes on to say that the court will allocate to the fast track – ‘unless it believes that it cannot be dealt with justly on that track’.

 

The main impact of Small Claims Court allocation is to deprive the tenant of legal representation. Recoverable costs are limited to £260 plus a payment of £750 for any expert report. In reality it means that an ordinary tenant of modest means is not represented. On which planet is it reasonable to say that the claim cannot be dealt with justly unless the claimant is deprived of the right to legal representation?

 

Housing Conditions cases are not straightforward. In the case of Birmingham City Council v Lee [2008] EWCA Civ 891, Hughes LJ observed –

 

‘It was accepted before us that, although of course the protocol is meant to be open for  operation by tenants in person if they wish to act alone, it was reasonably to be expected that many tenants would not be in a position to do so and would need legal help. For a layman, the requirements of the protocol are quite complex. The terms of the protocol make it clear that it anticipates that the tenant may incur legal costs in operating  it.’ (My emphasis)

This statement is not binding as the Birmingham case was about costs, but the principle is clear. Many, in fact most, tenants require legal help. Courts should take note of this comment from a senior appeal court. In the same case Hughes LJ also said in relation to Rule 26 –

The effect of that is: providing there is a claim for specific performance, a tenant's claim in a disrepair case will be a fast track case if either the cost of repairs or the consequential damages claim exceeds £1000. If, on the other hand, there is no specific performance claim, the ordinary rule in CPR 26.6 (3) applies and the claim will only be a fast track claim if its overall value exceeds £5000. (Now £10,000) (Para 7)

 

This is language similar to the practice direction 16. If the claim satisfies the criteria for the fast track, it will be allocated accordingly. This again is persuasive only. But if it good enough for the Court of Appeal, it is good enough for a District Judge on allocation.

 

For all of these reasons, I would strongly advise tenants’ advisers to oppose all attempts to dismiss perfectly valid cases as small claims. They are difficult enough. There can be few things worse than living in poor conditions. Tenants must be able to present their cases and to have access to legal assistance.