The court fee remission scheme is designed to provide access to justice to all, regardless of their financial circumstances. However, this scheme is also being used by insurance companies to make a profit.
The existence of the fee remission system means that insurers escape liability for court fees (in cases where the claimant is of limited financial means) and pass that particular liability on to the taxpayer.
Some might say ‘why does it matter who picks up the court fees as long as it isn’t the claimant?’ Well, it matters because in every case where the insurer secures such a saving, the public purse is being drained.
When legal aid existed, it assisted people who could not afford to finance a court action. It was an insurance policy in itself – but it meant that if the claim succeeded, all of the fees were recoverable from the tortfeasor and not from the public purse.
So, despite the existence of a tortfeasor and an insurance company standing in their shoes, the insurer is making substantial savings – that is profit, at the expense of the UK taxpayer.
The rules must be changed to ensure that the tortfeasor is primarily responsible for all fees even where there has been a fee remission. All of these losses could have been prevented had the rules been drawn up by someone who could have foreseen the potential for this abuse.
Guy Platt-Higgins is managing director, Law Costing Ltd, Birkenhead