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Thursday, June 21, 2012

County Courts - a Danger to Society?


County Courts – A Danger to Society?

This is probably a fairly inflammatory title to have for an article but I feel very strongly about this issue and the danger that county courts offer to a society in general if they continue to be run in their current state and decline further.

You may have read in my blog in recent years of our company’s frustrations at dealing with the county courts. We have seen sheer incompetence, intransigence, arcane and antiquated procedures and staff who are either so demoralised they don’t care or simply can’t be bothered in any event.

Our most recent run-in with the county courts has been in a case where a law firm owed us an amount less than £5,000 which put us well and truly within the Small Claims Track, which is where we are quite happy to be.

Unfortunately the law firm we were suing had worked out that the courts are so incompetent that they could simply counter-claim against us for £50,000, not pay their issuing fee, fail to pay their allocation fee and still get a case management conference hearing booked in before a Judge in Chambers.

As we are a Limited Company, although we are based up in North Wales (with a satellite London office) the case was transferred to the solicitors’’ firm local court, which of course meant that the case management conference took place in South London and if we had decided to attend ourselves would have cost in the region of about £400, almost 10% of the cost of our claim.

Fortunately on this occasion we were able to instruct an outdoor clerk to attend for us and surprisingly enough (or not) the solicitors’ firm failed to attend and we got judgement in our favour with the counter-claim being dismissed.

The frustrating point about this was that the Case Management Conference should never have taken place. I telephoned the court to ask if the defendants had paid their allocation fee and issuing fee and the court informed me that they did not need to and that the case was going ahead in any event.

Please correct me if I am wrong, but my understanding of the CPR rules was that you need to pay an issue fee if you counter claim and this has to be done before the hearing takes place. That has always been my experience and we have fallen foul of this a few times over the years when we have forgotten to pay.

However on this occasion the county court in question decided that it would be appropriate for everyone to attend court and for a case management conference to occur even though we were the only ones who had paid our fees.

I find this very difficult to fathom as county court staff appear to be well paid civil servants with excellent pensions, and should understand the process (and in fact almost every time we have any dealings with the courts seem to understand the process better than anyone else including the Judges).

Our second recent run-in has been with an application fee. We issued proceedings against a solicitors’ firm in January for failing to pay a bill (you may notice a common theme in solicitors’’ firms failing to pay bills!) and sat back and waited for the Small Claims procedure to kick in for the case to go ahead, with a hearing date and the offer of mediation etc to take place. We heard absolutely nothing after we sent in our allocation questionnaire - the court have still not responded.

About 6 weeks ago I telephoned the court in question, which was a County Court in North London, and was informed that they were still waiting for the Salford County Court Centre to send them the allocation questionnaire of one of the two defendants we had issued proceedings against.

I asked what would happen if they did not receive this from the Salford Centre and was advised that the court would have to wait for it.

Now as any fool knows, justice delayed is justice denied and if you are chasing a debt there is nothing worse than waiting 6 to 12 months when the defendants have quite happily shut office and moved on to other and better things leaving a trail of creditors in their wake.

It is one thing to get frustrated by the defendants at enforcement stage, but another thing entirely to get frustrated by the courts being so incompetent and slow that nothing happens in the case for well over 5 months.

I have written to the court a couple of times in this time but unsurprisingly have received absolutely no response.

In order to get things moving I put in an N244 Application to have the case listed before a District Judge and to air my grievances in writing in the hope that the District Judge would list the case and set out directions accordingly.

However, after sending my cheque for £45 with the form N244 I was astonished to receive it back again approximately 3 days later (how is that for efficiency) with a curt note to inform me that the HMCS is no longer called HMCS (Her Majesty’s Court Service) as it is now called Her Majesty’s Courts and Tribunal Service and any cheque payable to HMCS will be returned because it ought to have been payable to HMCTS.

I am absolutely gobsmacked that a government department the size of the Court Service could possibly just decide unilaterally at some stage that they were going to change the name on their bank account to HMCTS from HMCS. This is complete and utter madness. The court have had to process my application, send it back to me, with the cost of postage and take the time to write a letter which surely has cost in the region of about £30-£40 in admin costs, when if they had two bank accounts, one with HMCS and one with HMCTS they could continue to cash the cheques sent to them in error and everything would run a little bit more smoothly.

However this is not to be and some nameless official somewhere has clearly decided that it is to cost the taxpayer even more money and insist that everybody gets their cheques returned to them.

I hope I do not have to say anything else about the county courts and my experience of some of them has been absolutely excellent, but there seems to be a whole sway of county courts in the London area where the whole process is nothing but sheer incompetence from start to finish on the part of the court and the court staff.

This gets me back to the point of this article. This utter incompetence impacts on the reputation of the County Courts as functioning state institutions for rectifying matters in disputes. It will eventually impact on society in general. Let me give you an example.

There was a businessman I know who ran a perfectly viable company. He got into a dispute with a haulage company for around £25,000.

The obvious remedy for the haulage company would be to go for a claim in the county court to recover the money from the company on the back of their contract, using the county court structure to enforce judgement once they had it.

There is a much more (highly illegal) effective method of getting paid, and one that could be argued to be an indirect result of the inability of the County Courts to provide an acceptable level of service.

The haulage company had obviously worked out that there are so many loopholes in closing down companies and taking money out without having to pay creditors and that the county court structure is so useless it is incapable of providing them with any compensation in these circumstances that they took another option.

One of the hauliers simply telephoned the directors of the companies concerned and advised them that their legs would be broken if they did not pay the full amount within 7 days. Furthermore, the haulage company knew where the directors lived and would be coming round to see them very shortly to collect the money. As they would be driving a large lorry, this could accidentally flatten any cars parked outside the directors' houses.

The directors of this company decided that they could not trust the police to protect them in these circumstances (another example of breakdown of trust in the ability of the state to provide a functioning service?) and paid out from their own accounts straight to the haulage company to avoid any pain to their legs or damage to property.

This is a damage that the county court structure not functioning and providing the rule of law has on society. If we carry on the way we are then nobody will have any trust at all in the county courts or the structure and this type of action by the haulage company in question will become the norm.

I hope that someone from the court service and the government reads this blog and takes this into consideration when they next decide to cut services, or to let staff either be too demoralised to work, or provide such a terrible service that it brings the whole of the court process into disrepute.

Jonathan Fagan,

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Tuesday, June 12, 2012

Removing the Trainee Solicitor Salary Cap - a good idea?

The Solicitors’ Regulation Authority have recommended the removal of the training contract minimum salary, something that appears to have been broadly welcomed by a large number of organisations which include a significant number of vested interests, such as LPC providers. 

Is this a good thing? I don’t think so.  Probably a very controversial opinion, but I don’t think the legal profession as a whole can be trusted not to exploit potential trainee solicitors and take advantage of large numbers of desperate students and graduates who believe they need a training contract at all costs.

Furthermore, what on earth is the point of permitting law firms to effectively take on large numbers of low paid workers who can then be permitted to carry on and qualify as solicitors? Where does this leave the status of a newly qualified solicitor? Already in debt to the tune of around £25,000, NQ salaries in non-commercial practices are almost certain to plummet.

There are a good number of law firms out there whose sole purpose is to exploit just about everybody they have any contact with including their own workers, their clients and any third party such as the Legal Services Commission. These firms have to be regulated and monitored closely and the Solicitors’ Regulation Authority appears to spend its vast majority of time trying to avoid undertaking too much work and keeping very close tabs on firms.

One area where a vulnerable workforce is in dire need of an external organisation keeping close tabs on their employer is trainee solicitors. Trainee solicitors are particularly vulnerable because they invariably have large debts, are in need of a training contract in order to progress their career and fairly naïve in terms of the work place and any work they are asked to do.

By removing the minimum salary cap from trainee solicitors the Solicitors’ Regulation Authority will be giving these firms carte blanche to recruit as many trainee solicitors as they wish on a ridiculously low salary, provide a so-called training contract which in reality is anything but and to send these people out into the work place 2 years later as fully qualified solicitors.

The SRA have had no thought at all into the future large numbers of trainee solicitors who are going to struggle to get a newly qualified position. Furthermore they have had no thought at all to the likely future salary of any newly qualified solicitor as chances are firms will be able to drop newly qualified salaries even further than they currently have because there will be so many desperate trainee solicitors looking for their first newly qualified position.

We already have a profession where entrants into the profession are some of the lowliest paid. It made me laugh recently to hear of the Police Federation vehemently protesting that they thought a fairly recently qualified police officer could be earning as little as £22,000, when I am regularly dealing with 5 year PQE conveyancing solicitors who earn less than that because their firms have either taken the opportunity to mercilessly exploit them by claiming they cannot afford any more or because market forces dictate that there is so little work out there at present, they simply cannot justify a salary higher than this.

I don’t think the legal profession is responsible enough to regular itself with minimum salaries for trainee solicitors and I think the removal of  the minimum salary is nothing short of a catastrophe for generations of younger potential solicitors to come.

Jonathan Fagan - MD of Ten-Percent Legal Recruitment 


Ten-Percent Legal Recruitment - Online Legal Recruitment for Solicitors, Legal Executives, Fee Earners, Support Staff, Managers and Paralegals. Visit our Website to search or download our Vacancy Database or view our Candidate Database online.
Our Legal Careers Shop has eBooks on CV Writing for Lawyers, Legal Job Interview Guide, Interview Answers for Lawyers, NQ Career Guide, Guide to Finding Work Experience or a Training Contract and the Entrants Guide to the Legal Profession. To visit our Sale/Clearance section please click here.
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