The Ministry of Justice hopes it will help Britain become the \”largest specialist centre for the resolution of financial, business and property litigation anywhere in the world\” and on the face of it, there seems little to object to in that. I have many criticisms of the judiciary, but I have never entertained the notion that an English judge would take a bribe or succumb to pressure from the state. You cannot say the same of judges in Moscow, New Delhi or Beijing. The incorruptibility of the judiciary and the work ethic of the lawyers ensure that more international commercial disputes take place in London than in any other city in the world. And of course we need whatever taxes the lawyers\’ accountants condescend to pass to the Revenue.
We have an honest judiciary that Johnny Foreigner wishes to use.
Sounds like a matter for congratulation really.
See what I did there?
In the right place, this time 🙂
English is the world language and nobody in his right mind would trust the American courts. You don’t want to use the system in a country so small that it would be overwhelmed, or too remote, or too backward, so the choice is pretty obvious. Canada may have missed a trick but perhaps has no centralised legal city to compare to London. There must be a nice living in it. Good.
‘Sumption found that the modern British state celebrates the accumulation of money by whatever means necessary. The richer you are the more deserving of honours you become.’
Sumption accumulated his wealth by being repeatedly very good at what he does. Do we want some left-over from a Local Authority legal department to sit on the bench of the highest court in the land. Far better to have a poacher turned game-keeper, I’d have thought.
As an aside, someone will correct me for sure, but I think I’m right in saying that Partnerships, including LLP’s, cannot have ‘service companies’ as partners. Thus all fees are taxed at U.K. rates, so huge fees = huge tax bills. Bully for them staying here, I say.
I like the idea of selling legal conflict resolution services to the world, but should be be subsidizing this trade by providing courts and judges almost free?
His complaint is clear – these foreigners get to use the English legal system for practically nothing.
They have to hire the lawyers of course but the court facilities aren’t charged out at a commercial cost.
“the court facilities aren’t charged out at a commercial cost”: then get on with it pronto.
With PaulB, though I think it’s a hard question to answer without knowing a) the cost of running a typical court case of the required type. b) the average tax income resulting from such a case and c) the elasticty of foreign legal disputes resolving in lonson to the cost of it. But i doubt that we’re maximising that objective function currently.
This makes me giggle though;
“The credit crunch was so severe in Britain because the Wimbledonisation of finance ended when the crash forced all the foreign banks the government had encouraged to come to these islands to head home and take their credit for families and businesses with them.”
And, actually, we need to add in the tax reveunes from cases solved under UK law but through arbitration, as they’ll have much lower costs to the public purse. But could potentially be scared away if the cost of using uk courts is raised.
I think no group in the UK is less in need of subsidy than lawyers, the last closed shop! Agree with PaulB (for once) -Foreigners using the courts should be expected to defray costs….
Paul B and Matt on subsidising courts/lawyers.
For info, it costs £1670 to issue proceedings for over £300,000, £1060 to set it down for trial, and there’s a pretty unavoidable fee of about £220 early in proceedings. It can cost over £5000 if you want the court to assess costs (that’s to start the process, it’s not refundable if you compromise).
The overwhelming majority of cases settle without trial, so those (to some extent) subsidise the minority that do go to trial.
I don’t know how much the civil courts are self funding. I don’t see how the mega disputes in the Commercial Court can be – trials are longer where they do happen, and relatively few cases are started in the Commercial Court, apparently 1331 in 2011 http://www.macfarlanes.com/media/622222/the%20state%20of%20litigation%20-%202012.pdf
The more mid-size commercial cases may be more self-funding – more proceedings issued, shorter trials, higher proportion settled (my guess), less judicial involvement prior to trial, and higher issue fees in proportion to claim. Also more likely to be UK based litigants, so they’ll have to pay VAT on lawyer’s fees.
Family/matrimonial/small claims obviously won’t be self-funding. But I’m guessing you don’t paying for them.
Total annual expenditure on civil courts (including non-cash items) = £612.5m
Annual fee income from civil cases = £463m, and there’s another £66m from “warrant enforcement” which I think is also civil, so in total £529m.
So not much shortfall; an increase in fees of 15% (or a cut in their notoriously useless bureaucracy) would cover it.
But actually, as Luke (#11) guessed, it’s the family courts that lose the money. The higher courts pretty much break even (see page 52). And even there they’ve included the Court of Protection, which I suspect is where most of the deficit is.
So there may be arguments about particular cases, but overall these cases seem to pay their way, even before you include the tax paid by the lawyers on their fees.
English judges are successfully leant on by the government. The court service is a good example of what I think economists call “producer capture”, particularly in the context of taxpayer-funded services. Due process suffers as a result.
Edward Lud @13
And your evidence is what?
(I don’t actually know what your conclusion is, but first things first.)