COUNTY COURTS JURISDICTION (Hansard, 7 December 1965)

§ The Attorney-General (Sir Elwyn Jones)
I beg to move, That the County Courts Jurisdiction Order, 1965, a draft of which was laid before this House on 22nd November, be approved. This Order increases from £400 to £500 the jurisdiction of the county courts in actions founded on contract or tort and actions for money recoverable by Statute. It makes the necessary consequential amendments in the County Courts Act, 1959, and the Solicitors Act, 1957. The House will not need me to remind it that there has been a substantial fall in the value of money since 1938, when the upper limit of the jurisdiction of county courts in the actions that I have mentioned was fixed at £200. Taking the value of the £ in 1938 to be 20s., in 1955 it was worth 7s. 10½d. and now it is worth only 6s.
The effect of this fall in the value of money has been to take away from the jurisdiction of the county courts cases which would formerly have been within their jurisdiction and to place a corresponding burden on the High Court. The problem was looked at in 1955, and in that year Section 1(1) of the County Courts Act raised the limit to £400. Section 1(5) of that Act enabled the jurisdiction of the county court to be further increased to £500 and provided for the necessary consequential provisions to be made by Order in Council, provided a draft Order was laid before Parliament and approved by Resolution of each House. This provision was replaced by Section 192 of the consolidating County Courts Act, 1959, and it is under that Section of that Act that the present Order is made.
As I have said, the £ of 1938 was worth 7s. 10½d. in 1955 and at present it is worth 6s. The House will readily see that a greater increase than 100 per cent. would have been justified in 1955. Indeed, the jurisdiction would have had to be raised to £666 were it intended that it should keep pace with the decline in the value of the £ since 1938. However, the Administration at that time thought that it was desirable to proceed by stages, so as to give county courts time to absorb any additional work.
284 The increase to £500 now will therefore do little more than restore the jurisdiction of the county courts to what it was in 1955. The House may care to know that it is estimated that the result of this increase of jurisdiction will be about 200 cases more each year to be tried in the county courts.
I now turn to the details of the Order. Paragraph 1 substitutes £500 for £400 in Sections 39 and 40 of the 1959 Act. Those Sections deal respectively with the jurisdiction of the county court in actions of contract or tort and in actions for money recoverable by Statute. In addition, Paragraph 1 makes several consequential amendments in other provisions of the 1959 Act and of the Solicitors Act, 1957. Perhaps the House will want me to deal briefly with those consequential amendments, although I cannot pretend that it is material for excitement.
First, in Section 41 of the 1959 Act, which enables a plaintiff to abandon the excess of his claim over £400 in order to bring his action in the county court, £500 is substituted for £400. In Section 44 of the same Act, which enables a defendant to require a county court action for more than £40 to be transferred to the High Court on giving security for the amount claimed and costs not exceeding £450, £550 is substituted for £450.
In Section 45 of the 1959 Act, which deals with the transfer of an action from the High Court to the county court where the claim does not exceed £400, £500 is substituted. In the important Section 47 of the 1959 Act, which provides that, if a plaintiff in the High Court recovers less than £300 he shall not be entitled to more than county court costs unless the High Court otherwise orders, £400 is substituted for £300.
In Section 80 of the Act, which enables an infant to sue in a county court for wages not exceeding £400 as if he were of full age, £500 is substituted, in Section 136 of the Act of 1959, which enables an application for the attachment of a debt or for leave to issue execution in respect of a debt not exceeding £400 to be transferred to the county court, £500 is substituted for £400.
In the entry in the First Schedule to the 1959 Act, which gives the county court jurisdiction under Section 136 of the Law of Property Act, 1925, to receive into court a debt not exceeding £400 where 285 there are conflicting claims to it, £500 is substituted. In Section 33(2) of the Solicitors Act, 1957, which gives the county court jurisdiction to allow an action to be brought out of time for the recovery of a solicitor's charges and to make an order for the taxation of a solicitor's bill on the application of the party chargeable, the solicitor or a third party, where the costs relate to contentious work done in the county court and do not exceed £400, £500 is substituted.
It is intended that the draft Order should come into force on 1st January, 1966. The Schedule to the Order, as the House will see, contains transitional provisions authorised by Section 192(3) of the 1959 Act. These are modelled on the provisions contained in paragraph 3 of the First Schedule to the County Courts Act, 1955.
In general, the amendments made by the Order will apply to proceedings begun before, as well as after, 1st January, 1966, but I must emphasise that the amendment made in Section 47 of the Act of 1959—dealing with the provision that if a plaintiff in the High Court recovers less than £300, he shall not be entitled to more than county court costs unless the High Court otherwise orders—and raising the figure to £400 will not apply to proceedings begun before 1st January, 1966. The result is that a plaintiff in an action brought in the High Court before that date who recovers judgment even after that date for a sum exceeding £300 but not exceeding £400 will not be restricted to county court costs.
Paragraph (5) of the Schedule deals with the effect of the Order on the jurisdiction of the Mayors and City of London courts.
The Order does not deal with the costs recoverable in cases brought in the county court under this extended jurisdiction. This is a matter for the County Court Rule Committee, which, at its meeting on 19th November, 1965, passed an amendment of Order 47, Rule 21(3) which will enable the registrar, when taxing the costs in such a case, to allow such larger sums as he thinks reasonable in respect of the principal items in scale 4 of the scales of costs.
That seems to be a reasonable way to meet the problem of costs resulting from 286 the increase in jurisdiction. Accordingly, I commend the Order to the House as a useful and necessary measure.

§ Mr. Peter Thomas (Conway)
I am sure that the whole House will be grateful to the Attorney-General for his careful and lucid explanation of the Order. I have no doubt that the House will also wish to approve the Order. When the jurisdiction of the county court in actions founded on contract and tort was extended in 1955 from £200 to £400 by the County Courts Act, consideration was then given to whether or not the upper limit should be £500. However, it was then felt that to increase the jurisdiction so considerably at that stage might invite the risk of swamping the county courts with too much extra work, and, possibly, altering their traditional character.
It was, therefore, decided that the upper limit should be £400, but that that figure should not be inflexible. Also, in case it was felt in future that an increase was justified, Parliament was given the right, by affirmative Resolution, to increase the amount to £500. That is what the Order is about. It is now more than 10 years since that Act came into force and I think it will be agreed that the county courts had responded efficiently and effectively to the increase in jurisdiction that then was obtained.
The Attorney-General will, I am sure, agree that this increase in jurisdiction in 1955 would have been given much earlier to the county courts if the provisions of the Legal Aid and Advice Act could have been extended to the county courts earlier than was the case. Be that as it may, the case for increasing the jurisdiction to £500 is a strong one and the right hon. and learned Gentleman put that case most fairly as the fall in the value of money and the continuing trend in that direction. That means that this increase in jurisdiction does little more than restore the jurisdiction of the county courts to what it was in 1955. Since the Administration of Justice Act, 1964, many additional county court judges have been appointed and further appointments can be made under this Measure should the need arise.
I am grateful to the Attorney-General for what he said about costs and the 287 decision of the County Court Rule Committee. County court scales have been out of date for some time. This increase in jurisdiction makes them even more so and while I do not want to say anything more at this stage on this matter, I merely point out that there is an extremely strong case for a review of these scales. It would not be helpful to the House if, at this stage, I went further into the Order, which is justified and for which a case has been made out.

§ Mr. Daniel Awdry (Chippenham)
I intervene briefly to ask whether the Government have any intention of lifting the figure of jurisdiction beyond £500 in the fairly near future. I realise that this would need legislation but, nevertheless, the question needs to be asked.
The figure of £500 is, I suggest, far too low for some contracts, bearing in mind the change in the value of money to which the right hon. and learned Gentleman referred. I have had some experience of county court procedure. It is a good procedure because it is quick and fairly cheap for litigants. I am certain that greater use could be made of it. In my part of the world the court lists are by no means over-full and I am therefore sure that more use could be made of the county court.
To give a typical example, I have had some experience of building disputes—arguments about building contracts. Often the amount in dispute in these cases is over £500 but a little less than £1,000. If these sort of cases could go to the county court instead of the High Court a great deal of help would be given to litigants. Let us face it, going to the High Court today in these cases is a rather long-drawn-out procedure, and there are complicated pleadings which do not arise in the county court. If these sort of building disputes—involving sums of between £500 and £1,000—could go to the county court a great deal of time would be saved.
In their enthusiasm for law reform, the Government have increased the jurisdiction of the county court and I now ask the Attorney-General to let us know whether there are any intentions in the mind of the Government to increase it still further.

§ The Attorney-General
I am grateful to the right hon. and learned Member for Conway (Mr. Peter Thomas) for giving a fair wind to the Order and for his remarks. I can reply briefly to the hon. Member for Chippenham (Mr. Awdry) by saying that I do not think that there is any present intention on the part of the Government to raise the jurisdiction beyond £500. However, this is clearly something which will have to be considered as part of the inquiry recommended by the Law Commission into simplifying the procedure relating to actions for personal injuries. Our minds are certainly not closed to this possibility, but the limit of £500 contained in the Order is all that is presently contemplated.