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You are in: Home Page | Other Services | Small Claims Court Fact Sheet for a Consumer Problem
This factsheet should be used as a general guide only - if you require legal advice you should consult a solicitor.
The small claims track provides a simple and informal way of resolving disputes with traders. This can be done without a solicitor. This fact sheet will explain the procedure if you wanted to make a small claim for a consumer problem.
The types of consumer problems that are likely to be allocated to the small claims track are:
• Problems with goods that have been bought from a shop that are faulty
• Problems with services e.g. such as builders who are doing work on your house
• Any other problems with goods and services
The small claims court can also be used for debt action, injunctions, disputes about ownership of goods and disputes between landlords and tenants about repairs, deposits and rent arrears etc.
Criteria for Small Claims Action
Procedure for Small Claims Action
Case Studies
Experts
Fees and Costs
The Hearing
Preparation
Appeals
Other Points to Consider
Alternatives to Court Action
Legal Advice
Your claim normally must be worth under £5000 to be allocated to the small claims track. Even if the claim is worth less than £5000 it may not go to the small claims on allocation if it is too complex.
If your claim is worth more that £5000 it can still be allocated to small claims if all parties and the court agree to this. This will usually only happen if the case is not too complex. It would be advisable to consult a solicitor if a claim is worth more than £5000.
The time limit for action is 6 years plus there are time limits at all stages of the action.
The courts expect parties to follow a reasonable procedure. Failure to follow this could result in financial penalties. The reasonable procedure includes:
• sending a letter before action to the trader / builder etc.
• parties conducting negotiations to settle without court proceedings
You will need to obtain and fill in the claim form (N1) and make a copy for each defendant and the courts. Forms can be obtained from your local County Court, court-service website or forms can be issued online. See www.hmcourts-service.gov.uk
The claim form asks for your name and address, the name and address of the trader or person being sued, a statement of what the claim is about, and how much the claim is for. In cases starting in England and Wales, the claim form asks for a statement of value of the claim and also the client has to include a statement of truth, stating that what she / he is saying on the claim form is correct.
The particulars of claim outline the details of the claim. You would state here exactly what happened and why you are making this claim. The claimant can fill in the relevant section on the claim form or she / he can complete a separate particulars of claim which can be sent to the defendant within 14 days of having sent her / him the claim form.
You can also claim interest from the defendant. Some written contracts include terms relating to interest. If there is not one it is set at 8% Per Annum under s69 County Courts act 1984 and calculated on a daily basis. If you want to claim interest you must say so on the claim form.
The completed claim form should be taken to the courts either in person or by recorded delivery. The relevant fee should also be enclosed. The fee depends on the value of the claim (see below) and can be waived in certain circumstances.
The case is likely to be heard in the county court where the defendant lives or is based. You may be able to apply to have the case transferred but there is no guarantee this will be successful.
The court will send a Notice of Issue (form N205) which shows the case number.
The court will usually post the claim form to the defendant although if the claim form is returned undelivered, the court will tell you and you must then take responsibility for serving it.
The trader has a number of options. She / he may want to:-
• admit all of the claim.
• ignore the claim form.
• admit part of the claim.
• deny the claim altogether.
• wish to make a counterclaim.
• negotiate with the client out of court.
The defendant has 14 days after the date of service of the claim form to respond, which is deemed to be the second day after the day of posting.
If the trader defends the claim, the court will then allocate the case to a track. The court will send you a copy of the defence. The court will make its decision after receiving the allocation questionnaire (N150) that is sent to you with the defence.
The judge will make their decision based on the amount of money in dispute, the type of claim (i.e. consumer claims) and the amount and type of preparation needed to be able to deal with the case justly. The judge will have in mind that this procedure is simple enough to prepare without a solicitor and therefore will only involve minimal preparation and few witnesses.
You will be notified if the claim has been allocated to the small claims track on form N157 (or N160 if the claim is worth more than £5000). This form will include the time, place and date of the hearing and what the claimant has to do next.
If you are successful, the judge will make an order requiring the defendant to pay. This is a judgement. At the end of the hearing, the client should ask the court to include the costs in the order. The amount of costs that can be claimed in a small claims case does not usually include solicitors' fees. The judge can ask the defendant to pay either immediately, by instalments or in full by a certain date. If the trader fails to pay the amount, the member needs to ask for enforcement of the judgement. There will be a further fee to get the judgment enforced and the amount will depend on the method of enforcement. The fee may be waived in certain circumstances.
If the trader does not pay immediately, you can also apply for an order to bring the trader to court so that the financial circumstances can be examined. This is an order to obtain information from a debtor and could help you decide whether it is worth taking further enforcement action and which method of enforcement would be most appropriate.
A lady had a problem with a finance company. She entered into and was accepted for a credit agreement at a photographers shop. The lady paid a £500.00 deposit in cash and she paid for the rest of the portraits on the finance agreement which said it was non cancellable. The lady decided she wanted to cancel and the finance company allowed this as a good will gesture; however, they would not give the lady all her deposit back. They wanted to charge the lady £300.00 for work that had been started on the pictures as she had already had them taken. Therefore they only refunded £200.00.
The lady was advised that the general rule is that if a deposit is paid, it will not usually be refundable. There are exceptions to this rule. The one that was relevant in this particular situation was that she had bought the goods and services on credit.
If someone has bought goods or services on credit, he / she will be able to get all of her deposit back where:-
• s/he has signed a regulated credit agreement at home following face-to-face negotiations with the credit provider's representative or the supplier of the goods or services, and s/he has cancelled the agreement within the cooling-off period
• s/he has made an agreement linked to the principal credit agreement signed at home and cancelled the principal agreement within the cooling-off period
• s/he has signed a credit agreement which is not cancellable, but told the credit company that s/he does not wish to go ahead before the credit company has finally agreed to accept the client for credit
• s/he has signed a credit agreement related to goods or services bought by distance sale, for example, by phone or e-mail, and s/he has a statutory right to cancel the contract
• s/he had signed a credit agreement and the credit company has refused her / him for credit.
Therefore, the lady was not legally entitled to any of her deposit back.
Experts can be used to help support your claim, but to use a witness would need the courts permission. Therefore, it is not recommended you get an experts report or opinion until you have got the courts permission. Courts generally expect parties to agree on expert witnesses. If you and the other party can agree to use the same expert this will save you both costs.
When you make a claim you will have to pay a court fee.
If you are claiming:
| Up | to | £300 | £30 fee |
| £301 | to | £500 | £50 fee |
| £501 | to | £1000 | £80 fee |
| £1001 | to | £5000 | £120 fee |
There is also an additional allocation fee of £100 for claims over £1500
You will have to pay a court fee unless:
• You or your partner receive Income Support.
• You or your partner receives Pension Credit guarantee credit.
• You receive Income based Job Seeker’s Allowance.
• Your gross annual income is below a set limit and you receive Working Tax Credit with a ‘disability element’.
• Your gross annual income is below a set limit and you or your partner receives Working Tax Credit and Child Tax Credit between you.
If you can show that payment of a court fee will cause hardship to you and your family, the court may waive the fee.
If you win, there are certain costs you can claim. These include:
• Any court fees you have paid
• An amount of not more than £50 per day each for you and any witnesses you may have for loss of earnings due to attending the court hearing
• Any additional travelling and overnight expenses
• Costs for use of an expert up to a maximum of £200
• The party’s own and any witnesses’ expenses in attending court, for example, fares and accommodation.
• Costs ordered by the judge if one of the parties behaved in an unreasonable way
Remember if you have had the opportunity to settle this out of court and haven’t, you may not get your costs back, even if you win your case.
Costs will not be awarded by the court unless the successful party asks for them. This should be done when the judge is giving judgment. If there has not been a hearing, the successful party will need to write to the court asking for costs.
If a claim for more than £5000 is allocated to the small claims track, the winning party will be able to claim costs including solicitors' costs against the losing party.
If there is a hearing date set, you do not have to attend the hearing and the case will be heard in your absence. You must notify the court and the defendant by letter if you will not be attending no later than 7 days before the hearing date. If you wish to attend but for some reason you cannot by the date given, you can apply to the judge for a later date to be set. You may have to pay a fee for this.
Instead of a final hearing, the judge may decide to hold a preliminary hearing or propose the claim be dealt with without a hearing using only written evidence. If you or the defendant objects to the judge's proposal to proceed without a hearing, your claim will be dealt with at a hearing.
The hearing will be informal, the strict rules of evidence will not apply and you will not be made to take an oath that you are telling the truth.
After the hearing you will be sent an order. The order, or the judgement, will set out the judge's decision.
The court will tell you what they want you to do and by when for the final hearing. This is called ‘complying with directions’. It is very important you comply with these directions to ensure you are not penalised by the court.
You should gather all relevant documentation together that you will use to support your claim. The defendants must have received all the evidence before the hearing or it may not be allowed. It may helpful to write down what you are going to say beforehand.
You can take someone with you to the hearing if you do not have a solicitor to speak for you. This is called a lay representative and can be any one you choose including a family member, a friend or a trade union representative. You will have to pay for a lay representative yourself even if you win the case.
If you lose and want to appeal, you can do so only with the permission of the court. You can ask for permission at the end of the final hearing where the judgment was made.
You must have proper grounds to appeal and cannot do so on the basis that you simply disagree with the judge's decision. Permission to appeal may be given only where the court considers that an appeal 'would have a real prospect of success or that there is some other compelling reason why the appeal should be heard'.
The time limit for asking for permission to appeal is 21 days from the date of the decision being appealed, unless the court specifies a different time limit. An application for permission to appeal must be lodged with the court which made the judgment and a fee must be paid (although this could be waived in cases of financial hardship).
If the other party is unlikely to be able to pay, there is little point in suing. You could check whether the individual has gone bankrupt or whether the firm or company has ceased to trade.
You could also start a small claim online using the Court Service’s Money Claim Online Service. See link below.
Dispute resolution schemes, e.g. those sometime provided by trade associations and mediation can be a good alternative to court action and should be considered before taking legal action.
For more information on how to make a small claim for a consumer problem please see:
Guidance form EX307 on the Court Service website at www.hmcourts-service.gov.uk or www.tradingstandards.gov.uk
This fact sheet is intended as a general statement of the Law and does not purport to render specific advice, legal or otherwise, specific advice on a particular problem should always be sought.
This is a self help document that is relevant at 10 July 2006.