A lot of what we do is assisting with the Scottish aspects of UK-wide insolvencies. It is in that light that we encounter a recurring question – is it cheaper to litigate in Scotland than in England? Our initial response was “yes” but that was based on anecdotal experiences. The following table shows how that “gut feel” can be justified.
|Value of claim||England & Wales||Scotland|
|Up to £300||£35||£19|
|Up to £5,000||£50-£205||£106|
|Up to £10,000||£455||£132|
|Up to £200,000||5% of the value of the claim|| |
£132 (Sheriff Court) or £319 (Court of Session if action is more than £100,000)
|Over £200,000||£10,000||£132 (Sheriff Court) or £319 (Court of Session)|
A claim worth £50,000 will incur a court fee for commencing action of £2,500 in England but only £132 in Scotland. While it will depend on the complexity of the claim, the total cost of commencing a claim for £50,000 in Scotland including solicitors’ fees can end up being in the region of the court fee incurred in England (i.e. a total spend of circa £2,500).
Whilst litigation may be unavoidable, it is always our preference and that of our clients as appointees, to reach a compromise settlement position without the need for protracted litigation. Indeed the majority of cases that we raise end up settling. From the table above, it is clear that in those cases the court fees for simply raising any form of financial action could have a massive consequence on the commerciality of a settlement.
You will, of course, need to have jurisdiction in Scotland to bring a claim here. For individuals, the starting point is domicile which is presumed (a rebuttable presumption) with three month’s residence. For companies or associations, a place of business in Scotland is enough to found jurisdiction north of the border. There are also “special” rules for jurisdiction including the place of performance of the contractual obligation. There can be more than one location for the place of performance as long as it is a place where the creditor in the obligation can insist on performance.
So if you do have any cases where jurisdiction could be based in Scotland, it may be worth speaking to us before raising an action. The up-front costs and therefore investment in pursuing an action could be significantly different!
If you would like further information regarding the topics discussed in this blog, please contact:
Eilidh MacEwan by email: firstname.lastname@example.org or by phone: 0131 285 1809 / 07376 192 463.
Steven Jansch by email: email@example.com or by phone: 0131 516 5361 / 07841 920 100.
You can visit our dedicated Insolvency page here.