England and Wales
Every year thousands of people represent themselves in small claims hearings, though until recently they have not often been used by energy consumers. In England and Wales, small claims are heard in the county court which deals with civil cases where up to £100,000 is involved (claims of £100,000 or more are heard in the High Court). See CPAG’s Debt Advice Handbook for detailed information. It is available free at .
Where a dispute involves less than £10,000 – as with many consumer matters – it is dealt with under a simplified procedure known as ‘arbitration’, ‘the small claims track’ or ‘a small claims hearing’, normally taking the form of a hearing in private in chambers – ie, the judge’s private room.
All designated money claims in civil cases in England and Wales are issued in the Civil National Business Centre in Northampton. The centre is supported by a dedicated contact team that deals with all telephone queries relating to claims. You are encouraged to begin your claim online, although forms may be downloaded or are available from local county courts which are designated as hearing centres.
Proceedings may be brought against a supplier which is in breach of contract (eg, overcharging or wrongly withholding a refund) and for any harm or damage it may cause, either by itself or through its employees or subcontractors.
The small claims court is a relatively informal procedure, suitable for people who are not represented by a solicitor. This might be appropriate if an unlawful disconnection has caused you a relatively small loss or your landlord has been charging more than the maximum resale price for gas or electricity.
Other claims might include where you have a dispute with an energy company about the amount you have paid or where there has been a failure of supply which has resulted in damage such as loss of frozen food. Or you may have a dispute about the amount of fuel consumed at your home which you cannot resolve with the supplier.
Neither side can claim legal costs beyond the court fees involved and, as a result, suppliers tend to settle these cases rather than spend money on contesting them which will not be recoverable.
When the claim form is issued, a court fee is normally payable. However, if you are on universal credit (UC), income support (IS), income-based jobseeker’s allowance (JSA), income-related employment and support allowance (ESA) or pension credit (PC), you may be exempt from paying any fee on application to the court (see here). If you are not receiving any of these benefits, you can apply for remission or reduction of a fee if you would otherwise suffer undue financial hardship because of the exceptional circumstances in your case. If you succeed in your claim, the court fee is added to the amount which the other side has to pay you. Unlike other court proceedings, only limited costs can be reclaimed. This means that, even if you lose, you will not have to pay the other side’s own legal representation costs – ie, each side is responsible for its own costs. If the case is settled or discontinued, there may be a full refund of the hearing fee if you notify the court in writing, at least seven days (excluding the date of receipt and date of hearing) before the trial date or start of the trial week.
The claim form requires you to set down the details of your legal claim. Copies of the form are then lodged in court on payment of the fee (unless this is waived) and a copy is sent to the other side (known as the ‘defendant’). The issue of the form requires the defendant to either admit the claim or defend it. In either case, the defendant must reply to the issue of the proceedings. If the defendant does nothing, after 21 days you may be entitled to claim judgment in default. This means you can obtain your judgment without having to argue the case in court, simply because the defendant has failed to reply.
Experience suggests that fuel suppliers rarely contest proceedings in the small claims court, especially in cases involving relatively small sums (eg, less than £500), as the cost of sending someone to attend the hearing often exceeds the amount of money concerned. This factor encourages the settlement of a dispute. Small claims may be particularly suited to the recovery of deposits.
The court will issue a set of directions which should be followed.
In any case, it is important to exchange copies of all documents which you seek to rely upon with the other party before the hearing. This gives the other party the opportunity to settle the case ahead of any hearing.
Under the rules of civil procedure, each side is entitled to see the written evidence and documents used in a claim before the hearing according to the timetable. Each side is expected to list its documents and make copies available. Neither side should be taken by surprise by written evidence at the hearing.
In bringing a claim relating to overcharging or a failure to supply for which you have been charged, you should gather together all your energy bills. If you no longer have them, request them in writing from your supplier. Also bring a copy of all correspondence and the contract with the energy company. These documents should be organised in date order.
Look at the agreed price for supply and work out whether the company has charged the correct rate for units over 12 months. Check whether it has charged more. Use April 1 to March 31 as the start and finish dates. Look especially at any periods where there may have been overcharging. You must produce these documents if a case goes as far as court; before any hearing, you should also send the other side copies of all documentary evidence on which you intend to rely.
For each year, work out how many units over the limit you have been charged and multiply them first by the higher rate and then by the lower rate. The difference is the amount that you should claim for overcharging.
Check whether the supplier has ever given you an explanation of its charging methods. If not, state that you believe you have been wrongly charged from when you became a customer, to the present day. Calculate your entire usage over the period and work out how much it would have cost when your supply started. Then work out how much you have actually paid. The difference between the two figures is what you should claim. Such cases may also arise from undercharging, leading to the supplier suddenly trying to recover money with a demand for a lump sum.
The rules of court encourage parties to try to settle their cases without recourse to court proceedings – at any stage parties can negotiate and make settlement proposals to each other to avoid litigation.
If the matter goes as far as a small claims court hearing, each side can present their case. Any written evidence which is presented should normally be served on the other side well before this final hearing takes place.
Transfer of proceedings
If you become involved with litigation with an energy supplier, it may be important to ensure a transfer of proceedings to your nearest county court (your ‘home court’) or the High Court if the claim exceeds £100,000. An application may be necessary to the court.1s42 County Courts Act 1984 When considering whether to grant a transfer, the court must consider:2CPR Part 30.3 •the financial value of the claim and the amount in dispute (if different);
•the convenience of moving to another court;
•the availability of a judge specialising in the type of claim in question;
•whether the facts, legal issues, remedies or procedures involved are simple or complex;
•the importance of the outcome of the claim to the public in general.
Methods of service
The Civil Procedure Rules set out the various methods of service that can be used. The usual method of service is by first class post, with the documents deemed served two days after posting. Service may also be by email, fax or through a document exchange.
Witness statements and all documentary evidence should also be sent to the other side before the hearing. For example, you might wish to call an electrician or meter reader as a witness in a case, in which case it will be necessary to submit a written witness statement of what they will say first. Documentary evidence should normally be exchanged between both sides in a case before the hearing, subject to directions by the court. Each side gives its evidence to the court and has an opportunity to question the other (a process known as cross-examination). The judge may also ask questions of the parties at the hearing.
Representation
You are entitled to ‘quiet assistance’ from a friend to help present your case. The friend can take notes, suggest questions and give you advice and moral support. The friend may be legally qualified, but this is not essential. Such assistance is known as having a ‘McKenzie friend’3McKenzie v McKenzie [1970] 3 WLR 472 (or ‘courtroom supporter’ or a ‘lay supporter’ in Scotland), and courts are generally familiar with the concept. McKenzie friends often assist debtors in debt recovery proceedings in certain courts. The McKenzie friend has no right to address the court but, in practice, the courts may allow a McKenzie friend to address the court if you have difficulties. The right to speak is discretionary, and anyone granted the right to speak must not abuse the privilege. In particular, it is crucial that any statements made to the court relate to the facts and points of law in the case and are not directed as a general attack on the energy company and its policies. If the right to a McKenzie friend is abused (eg, by making political or personalised attacks), it may be withdrawn. It is important to be polite at all times.
The judgment
A small claims court judgment takes effect like any other county court judgment. Enforcement action can be taken if the party does not follow the terms of the judgment – eg, in a claim for compensation by paying the money owed or awarded.