Perhaps the courts would benefit from looking at the cost rules in UK employment tribunals. In the employment tribunals, each party bears their own costs unless the other party can show, once the tribunal has handed down Judgment, that the claim or defence was frivolous, vexatious or misconceived. An employment tribunal has the power to require one party to make a payment to another up to the value of £10,000 or order that costs be subject to detailed assessment by a county court if they exceed £10,000.I think this comment should be removed

1. Are costs of litigation too high?

The vast majority, over 95%, of all litigations settle before trial. Consequently a great deal of disputes are resolved at a very early stage without significantly high cost, but the process is often confidential so these cases are rarely reported. We focus on dispute resolution and prevention to keep costs to a minimum. For the small percentage of cases which do go to trial, the costs of any litigation can vary enormously and it is easy to generalise.

The critical thing is that costs are proportionate to the amounts involved. This is one of the first matters which we will discuss with you when advising on your dispute. Almost all my clients will have a keen sense of risk. They want to know (1) what are the percentage chances of success if it goes to court? (2) how much might they/their opponent get? (3) how much might it cost to fight? (4) what are the best and worst case scenarios? Armed with this information most commercial clients will be able to make their own decisions on whether to litigate or to settle – they remain in control.

2. Is there too much front loading of costs?

The point here is that the Civil Procedure Rules require litigation to be regarded as a last resort. The parties should try and identify and narrow the issues and hopefully settle the case before proceedings start. This requires early investment in legal advice. Gone are the days of “firing off a Writ”. Personally I think this is no bad thing. Before issuing proceedings a claimant can usually choose to discontinue his claim at any time with impunity. After proceedings however, the Claimant can only discontinue with the agreement of the Defendant or by filing a notice resulting in an automatic payment of the Defendant’s costs, Before pushing the button, a claimant should want to know as much as possible about its case and the risks involved.

3. Are “totally innocent” parties ensnared in expensive Court disputes they cannot afford?

If your hypothetical Claimant/Defendant indeed had what might be termed a “slam dunk” then there are procedures to strike out suspect claims or defences at a very early stage. If the case is stronger than that, your client has the option of making an offer of settlement which if rejected, may result in an adverse costs order against his opponent. The aim is to curtail litigation rather than prolong it.

4. Should we abolish costs shifting in most cases as in the US?

In England, the loser tends to pay the costs of the winner (known as “costs shifting”) in all except “small” claims.

As you say, the US courts in most states (except eg Alaska) do not award costs to the losing party. Lord Justice Jackson considered this possibility in his interim report on Civil Justice

http://www.judiciary.gov.uk/about_judiciary/cost-review/reports.htm

But he discounted it and I agree with him. A claimant with nothing to lose will naturally be far more inclined to fight his case in Court than one who fears costs – and your hypothetical innocent defendant would certainly be no better off.

And for small claims (ie commercial cases below £5,000)? This is the rough- and-ready end of commercial litigation in which the winner does not tend to be awarded costs. The procedure is truncated and user friendly and the trial is a very short hearing in front of a junior judge. Lawyers are rare. And by all accounts it works. Given that most individuals in this country will tend to fight contested disputes for less than £5,000, access to justice is not as bad as it is commonly perceived.

And finally, universal access to justice was a reality for a time in this country; under the old legal aid system the majority of costs were paid by the state. But successive governments whittled its funding to almost nothing. You can’t blame the lawyers for that.I think this comment should be removed