Civil justice systems that are underpinned by clear, enforceable law will generate and sustain inclusive, well-functioning communities in which people can exercise their legal rights and make others fulfil their responsibilities. They also ensure that we share understandings and expectations of our rights and responsibilities in everything we do - from buying something in a shop to making a business contract. Where a sound system does not exist, societies and economies collapse.
Our strategy for civil justice seeks to ensure that our legal aid and court systems and procedures are efficient - but we also go much further. People will only understand their rights and responsibilities, obey the law and prevent disputes if the law is fair, up-to-date, simple, clear and enforceable. They must have access to information about the law and the legal system; to advice on value for money and quality legal services; to efficient and proportionate court and other dispute resolution services; and to effective enforcement.
Civil law defines our rights and responsibilities in everything we do, including buying a home, making a will and making a purchase in a shop.
We are working with the Law Commission on a major family and civil law programme, to make the law more effective for enhancing social justice and achieving our other objectives.
Objective
To make civil and family law clearer and more easily enforceable - giving priority to key Government objectives in tackling social and economic issues (SO4).
Law reform aims to make the law fairer, simple and clearer, so people understand their rights and responsibilities. Simpler law reduces costs and burdens on citizens, businesses, taxpayers and the courts. Our work therefore also contributes to SO2 - to improve people's knowledge and understanding of their rights and responsibilities - and SO1 - to provide a fair, swift and effective system of justice which gives value for money.
We sponsor the Law Commission (see Section 8.VI), and work closely with it to ensure that its programme reflects the Government's objectives and priorities. Our common aim is for the Commission, so far as possible, to take on projects likely to result in recommendations that the Government can accept and implement. An important part of this process is the inter-Departmental Ministerial Committee on the Law Commission, established in 1999 and chaired by Baroness Scotland. The Lord Chancellor approved the Commission's 8th Programme of Law Reform in July 2001. We will undertake a review of the Commission this year.
We are taking forward a number of projects for reforming both substantive and procedural law, including a major review of the enforcement of civil judgments.
We are introducing commonhold tenure. This will give people occupying interdependent properties, in particular those living in flats, a way to own the freehold of their property without the disadvantages associated with 'flying freeholds' or long-term leases. The new scheme is based on standardised documentation and is less complicated. Where disputes do arise, for example about the management of common parts in a block of flats, the scheme provides for the use of Alternative Dispute Resolution (see Section 3.VII). The Commonhold and Leasehold Reform Act received Royal Assent in May 2002.
The Damages Act 1996 gives the Lord Chancellor power to prescribe a discount rate for calculating damages in personal injury cases when a lump sum is intended to provide for future care costs and loss of earnings. The discount rate will reflect the amount that the claimant could expected to earn from interest by investing the award in a low risk way. Too high a rate would mean that claimants could not be sure of receiving the income they need. Too low a rate would unfairly penalise defendants (including the NHS), and lead to higher insurance premiums. In June 2001, the Lord Chancellor set the rate at 2.5 per cent.
In February 2002, we published a consultation paper on whether the court should have power to order periodical payments instead of lump sums, when an injured person is awarded damages for future care costs and losses. We believe periodical payments are a fairer and simpler way to provide the right level of compensation in these cases.
Laws drafted in the past should not prevent our developing and using modern technology. We are contributing to the Government's initiative for Modernising Our Laws for the Information Age (MOLIA). Along with other government departments, we have considered all the Statutes for which we are responsible to identify any provisions that might require amendment. The Office of the e-Envoy made an initial report to Parliament in December 2001.
E-wills are one of the main issues in our MOLIA report. The world is moving online and in future people will be able to make their wills electronically. We must decide whether we need legislation to facilitate e-wills as we will need safeguards to ensure their validity and security. We will also make an Order under section 8 of the Electronic Communications Act 2000 to regulate the e-conveyancing process (see Section 3.X).
We introduced a series of reforms of the Civil Procedure Rules, Practice Directions and Pre-Action Protocols on 26 April 1999 (SDA31). These cover how civil court cases in England and Wales proceed, and the reforms were intended to lead to a fairer and more just system. We aimed to make costs and procedures more proportionate to the issues at stake, to deal with cases faster, to encourage earlier settlement (out of court, where possible), and to discourage ill-founded claims.
These reforms have been well received and the overall number of claims issued has fallen. Anecdotal evidence also suggests that pre-action protocols are working well to promote early settlements. The number of settlements made at the last minute has fallen and settlements before the hearing day have become more common. Part 36 of the Civil Procedure Rules, which allows claimants as well as defendants to make offers to settle, has been welcomed by all interested groups as a means of resolving claims more quickly.
It is difficult to assess the impact of the reforms on costs because a greater number of cases have been resolved more quickly before reaching the courtroom. We are using data from a variety of sources, including the Legal Services Commission and members of the Association of British Insurers, particularly on personal injury cases, to build up a full picture. The Civil Justice Council and the Law Society are sponsoring research into pre-action behaviour. Nottingham Law School is researching the use and effects of case management.
Links:
Emerging Findings: An early evaluation of the Civil Justice Reforms
Where a person obtains a judgment which involves another person paying him or her a sum of money, there are occasions when payment will be achieved only by way of enforcement. However, this happens in only about one in three cases. Both the private and the public sector offer a range of enforcement procedures for this purpose.
One method of enforcement is execution against goods. This is performed by bailiffs who visit the debtor and remove goods for sale at public auction. The proceeds of that sale are then used to settle the debt. However, a bailiff will always first try to obtain the payment by negotiation with the debtor, and will remove property only as a last resort.
If the person owing the money is employed, a creditor might apply to the court for an attachment of earnings order. Money towards payment of the debt will be deducted from wages or salary on a regular basis until the debt is paid.
Where a debtor is known to have property, usually a house, the creditor can apply to the court for a charge to the value of the debt to be placed on that property. This entitles the creditor to payment of the amount from the proceeds of sale when the property is sold, before those proceeds are paid to the vendor.
If a third party, such as a bank or building society, is known to be holding money on the debtor's behalf, a creditor can apply to the court for an order that the money in the account be frozen; this means that the debtor may not have access to that money. The court will then decide whether the amount frozen should be paid to the creditor rather than to the debtor.
County court judgments under £600 are enforced by county court bailiffs, while judgments over £5,000 are enforced through a High Court writ of fieri facias. Fieri facias comes from the Latin for 'make it happen', and is equivalent to a county court warrant of execution. For county court judgments between £600 and £5,000 creditors may, for the most part, choose between enforcement in the High Court or the county court.
Sheriffs are private sector enforcement agents who are also officers of the court. They have the monopoly to execute High Court writs of fieri facias and also writs for possession and return of goods. Where High Court judgments require enforcement by way of execution, sheriffs enforce them.
We want to ensure that when people have a judgment made in their favour, that judgment is properly enforced.
Target
To increase the enforceability of civil judgments by achieving a 10 per cent increase in the amount recovered per pound under executed warrants issued in the county courts in 2001-04, with this target to be reviewed and new targets set for 2002-04 by December 2001 (PSA7).
We will conclude our comprehensive review of enforcement this year (SDA17).
We want to make sure that we cover all methods of enforcement. We are discussing with representatives of private sector bailiffs a common method of recording statistics so that they can provide us with information on their rates of recovery. So far, we have agreed definitions of terms such as 'unenforceable' with the Sheriffs, and have agreed targets on enforceable writs (initially 35p/£ as from 1 July 2002), subject to review. We have also provided their representatives with draft copies of forms for recording statistics every quarter, with guidance notes, for them to review.
We have a challenging task ahead of us, but we are determined to give customers the information and support they need in choosing appropriate enforcement methods and service providers. The better people understand the system, the greater the likelihood of successful recovery. We are considering introducing other performance indicators relating to other types of enforcement.
The performance of county court bailiffs on warrant enforcement has improved steadily since 1998-99. They now collect 76p in every £1 of correctly directed warrants.
In the longer term, one option for progress is to bring in legislation to regulate the market and enforce information sharing. The exchange of information means that enforcement is fairer to those who cannot pay; it is also fairer to those who are seeking to enforce against those who can pay but are reluctant to do so.
In conjunction with HM Treasury's Evidence Based Policy Fund, we have commissioned a research project into mapping the 'can't pay/won't pay' divide among debtors. The project arose from an issue raised by the Report of the First Phase of the Enforcement Review, which identified that 'the system is not good at identifying which debtors have the ability to pay and which do not, so debtors may find themselves being pursued relentlessly for a debt that they have no means of paying. Equally, debtors who know the system's weaknesses are able to exploit them to avoid payment.' The research project will address the following questions: