Martin Partington: Spotlight on the Justice System

The Civil Justice Council has just published an important report on the potential for the use of new processes to deal with disputes in small value claims, under £25,000.

In summarey, the report states:

‘Our principal recommendation is that HM Courts & Tribunals Service (HMCTS) should establish a new, Internet-based court service, known as HM Online Court (HMOC). We recommend that HMOC should be a three-tier service.

•  Tier One of HMOC should provide Online Evaluation. This facility will help users with a grievance to classify and categorize their problem, to be aware of their rights and obligations, and to understand the options and remedies available to them.
•  Tier Two of HMOC should provide Online Facilitation. To bring a dispute to a speedy, fair conclusion without the involvement of judges, this service will provide online facilitators. Communicating via the Internet, these individuals will review papers and statements and help parties through mediation and negotiation. They will be supported where necessary, by telephone conferencing facilities. Additionally, there will be some automated negotiation, which are systems that help parties resolve their differences without the intervention of human experts.
• Tier Three of HMOC should provide Online Judges – full-time and part-time members of the Judiciary who will decide suitable cases or parts of cases on an online basis, largely on the basis of papers submitted to them electronically as part of a structured process of online pleading. This process will again be supported, where necessary, by telephone conferencing facilities.
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The establishment of HMOC will require two major innovations in the justice system of England and Wales. The first is that some judges should be trained and authorized to decide some cases (or aspects of some cases) on an online basis. The second innovation is that the state should formally fund and make available some online facilitation and online evaluation services.

To ensure the implementation of our principal recommendation, we propose three supporting recommendations:
• that HMCTS introduces an ODR stream into its current programme for the reform of civil, family, and tribunal work, and allocates a modest fraction of its £75 million annual reform budget (over five years) for the establishment of HMOC;
• that all political parties offer in-principle support for HMOC, as a viable way of increasing access to justice and reducing the cost of the resolution of civil disputes; and
• that the Civil Justice Council invites the ODR Advisory Group to commence a new phase of work, collaborating with HMCTS and the Judiciary in formally piloting ODR, designing HMOC, and raising awareness of this new approach to the handling of civil disputes.

Although our terms of reference are restricted to civil claims under the value of £25,000, we believe that that the jurisdiction of HMOC should also be extended to suitable family disputes and to appropriate cases that come before today’s tribunals.’

It seems to me that developments on these lines are inevitable, for two particular reasons:

First, there are already in existence in the UK a number of dispute resolution procedures that are efficient and very cost effective using modern IT. Examples mentioned in the report include the Financial Services Ombudsman scheme, the Traffic Penalty Tribunal scheme, and Resolver.co.uk. However the majority of live examples are currently operating abroad. It is a pity that other similar procedures already operating in UK are not mentioned – for example the tenancy dispost dispute resolution schemes, all of which operate online and are free to appellants. (I am Chair of the Board of one of the companies offering this service.)

Second, the EU is in the final stages of ensuring that new forms of consumer ADR and ODR will be in place in member countries in the near future.

However, I also think more work needs to be done on considering the sources of the resources needed for running the service. Will this all come from the state? from users? from insurance companies needing to get disputes resolved? from industry bodies?

It also needs to be asked who the adjudicators should be. The report talks about members of the judiciary. But large numbers of disputes do not involve complex questions of law – they depend on the finding of facts based on evidence provided. It is not self evident to me that the only people capable of reaching sensible conclusions are judges. Indeed the existing schemes demonstrate that this is not the case.

Further development will be noted here as they occur.

Meantime, the CJC report is available at http://www.judiciary.gov.uk/reviews/online-dispute-resolution/odr-report-february-2015/

It is accepted that the courts have power to declare a statutory instrument invalid where it has been made outside the powers (ultra vires) provided in the Act of Parliament. In practice this happens rarely – not least because officials usually ensure that they do not act beyond their powers.

However, in July 2014, in The Queen on the Application of the Public Law Project -v- The Secretary of State for Justice and The Office of the Children’s Commissioner [2014] EWHC 2365 (Admin), the Administrative Court did find that a regulation had been made ultra vires.

The issue arose from the desire of the present Government to cut public expenditure on legal aid. Arguing that what money was available should go to those most in need, the Government proposed that there should be a ‘residence’ test for civil legal aid. This would mean that, with some exceptions, 12 months continuous residence in the UK would be required before someone could be eligible for public legal aid funding. The rule was set out in a Draft Regulation, that was due to come into force in August 2014.

The problem arose because the Legal Aid, Sentencing and Punishment of Offenders Act 2012, in Part 1 of Schedule 1, list types of  case that remained potentially covered by the civil legal aid scheme.  Funding remains in place because the listed cases are regarded as having the greatest need for legal aid. In short, the Act limited entitlement according to criteria based on need and not on any other basis.

It was argued that, by seeking to prevent those coming new to the UK from getting legal aid, their needs might be just as urgent as those affecting people already here, but they would be denied legal aid because they did not meet the residence test. It was argued that the attempt to introduce this test by regulation was outside the scope of the Act. It was also argued that the effect of the regulation would, if upheld, be to discriminate unlawfully against those recently come from abroad. The Division Court agreed with these arguments and declared the Draft Regulation of no effect.

The Government announced that it would appeal the decision, but in the meantime, they would not go ahead with implementation of the draft Regulation.

The text of the decision is at http://www.judiciary.gov.uk/judgments/the-queen-on-the-application-of-the-public-law-project-v-the-secretary-of-state-for-justice-and-the-office-of-the-childrens-commissioner/

The Government response is at https://www.justice.gov.uk/legal-aid/newslatest-updates/civil-news/update-on-civil-legal-aid-residence-test