Civil Justice crisis deepens as courts risk a ‘tsunami’ of motor finance claims.
Record delays in the civil justice system could worsen dramatically in the years ahead if motor finance claimants are forced to use the courts to settle claims against their lenders.
Experts say the motor finance scandal could resulted in up to 30 million claims, many of which could end up in court unless regulators act quickly to agree a redress scheme which includes a fast-track process to get people repaid.
The latest Civil Justice Statistics Quarterly, published by the government today (5 December 2024), show the average time taken for small claims to go to trial was 50.7 weeks in the third quarter of the year, up slightly from the previous quarter (50.6 weeks). Meanwhile, the time taken for more serious multi/fast track claims to go to trial increased year-on-year by nearly a week on average, to 76.8 weeks.
Commenting on the figures, Matthew Maxwell Scott, executive director of ACSO, which represents civil justice consumers, said: “While political attention is always on criminal justice, these figures show that the civil courts are broken, and that is where the vast majority of citizens interact with the law. Wait times are long and often getting longer, with a huge risk on the horizon in the form of motor finance claims.”
Maxwell Scott warned that civil courts could face a “tsunami” from the latest scandal to hit the financial services sector, with consumers potentially forced to go to court if the Financial Conduct Authority drags its feet setting up a comprehensive redress scheme while it waits for the Supreme Court to decide whether or not to hear an appeal.
“Those wanting to make a complaint to the Financial Ombudsman while using a professional representative may soon have that avenue cut off as it is about to levy steep charges on such consumers, even, incredibly, if their complaint is upheld.
“With the average claim potentially worth around £2,500, people may understandably choose to go to court to make sure they get what they deserve. But if a courts system which receives 1.6m claims a year is suddenly faced with a tsunami of up to 30m cases in short order, imagine the chaos that will ensue.
“None of us want to see this happen and a struggling courts system to sink further into the mire, but the choices open to claimants are limited, and institutions may not be moving fast enough to implement a redress scheme that is accessible and fair to customers.”
Maxwell Scott added: “The new Civil Justice Minister Sarah Sackman needs to get a grip on the system, and fast. Her predecessor used her first speech on civil justice last week to make the right noises, but was then made Transport Secretary an hour later.
“She should also liaise with colleagues at the Treasury and the regulators to make sure that the car finance scandal doesn’t lead to even-greater consumer detriment.”
Following the recent general election, ACSO set out a five-point plan for the Ministry of Justice (MoJ):
- focus on civil justice, including new funding where necessary and fresh impetus behind the courts reform programme;
- adopt a range of models of dispute resolution, including new technologies where appropriate, working with the MoJ, the Master of the Rolls, service providers and others to build public awareness of and trust in new methods;
- be more transparent on waiting times, court and tribunal processes and the implications of delays, cancellations and arcane processes;
- set clear targets for getting delays down; and
- work with stakeholders across the legal and claims sector to achieve a coordinated, consensual approach.