In the UK there are two legal definitions of insolvency. The first is where an individual or...
Small claims - the costs issue
On 1 April 2013 there was a change to the threshold for claims in the small claims track. Until this date a small claim was deemed to be one where the value of the claim was £5,000 or less; from 1 April this has increased to £10,000.
The implication is that the cost recoverability rules, which are presently applied to cases up to £5,000, will extend to cases worth up to £10,000. These rules are that legal costs and disbursements are not recoverable from the other side, even if you are successful.
The result is that the benefit of issuing a claim will need to be considered very carefully; unrecoverable costs could quickly exceed the value of a claim.
In the light of the new threshold it will become even more important to consider alternative means of settling disputes at an early stage.