3

"In fact, English law is the preferred governing law for business transactions worldwide, even those that don’t have any geographic connection with the UK."

If too many litigants unconnected to the UK sue in UK courts, then they shall overwhelm the UK courts and unjustly crowd out UK taxpayers. Thus how does Her Majesty's Courts and Tribunal Service safeguard English courts from being overflowed with foreign litigants unrelated to the UK? HM Courts and Tribunal Service has to get more out of these litigants than these litigants pay????

More than £200,000 £10,000

For example, Soviet oligarchs have sued for way more than £200,000. Unquestionably, their complex litigation cost English judges, not to mention HM Courts and Tribunal Service, WAY more than £10,000.

I know that English judges don't bill by the hour, but I instance with billable hours. Most judges in the Senior Courts were QC's. Presuppose £500/hr as the average fee for a QC. Then £10,000/(£500/hr) = 20 hours. But these complex cases must have taken judges way more than 20 hours to hear! And these lengthy judgments take way more than 20 hours to write!

3
  • 2
    Why do you think a person who lives in London is unconnected with the UK?
    – Dale M
    Commented Aug 20, 2022 at 9:51
  • 1
    @DaleM I don't. I emboldened "those that don’t have any geographic connection with the UK." And why do you assume these oligarchs "live" in London? Perhaps they just bought freeholds in London, and/or stay there a few days a year.
    – user49089
    Commented Aug 23, 2022 at 9:51
  • 1
    and why wouldn’t that be a connection? If I own property in London I would expect to have access to UK courts.
    – Dale M
    Commented Aug 23, 2022 at 10:13

2 Answers 2

3

Courts are a public service

They run at a loss.

Notwithstanding, just because a contract is under English law doesn’t mean it will be heard in an English court. Other nation’s courts will determine disputes according to English law if the contract so stipulates.

Whether an English court will agree to hear a case depends on a) if there is a sufficient nexus with England or Wales to engage jurisdiction and b) if one of the parties argues that a court in another jurisdiction is a more appropriate venue, if the English court agrees.

5
  • Wow. That is surprising. Wouldn't it require much more training for a French or Kenyan court to be willing to hear/adjudicate cases according to English law as the judges would presumably have been trained in their respective local legal systems accordingly? Commented Aug 20, 2022 at 10:55
  • How is that a realistic faculty to offer? Presumably French courts can only judge according to French law? Commented Aug 20, 2022 at 10:55
  • 3
    @JosephP. The lawyers’ job is to make submissions on the English law. That is, both sides explain the English law to the French judge. Bear in mind the parties only have choice of law with respect to the contract - other law (French or English) still applies.
    – Dale M
    Commented Aug 20, 2022 at 11:39
  • @JosephP. The Judge might even throw out the submissions as insufficient for re-filing if he sees a problem with the briefs.
    – Trish
    Commented Aug 20, 2022 at 13:58
  • 1
    @JosephCorrectEnglishPronouns "Presumably French courts can only judge according to French law?" No. A court applies the law that governs the dispute which it determines using a body of law known as "choice of law" which is separate and distinct from the law of jurisdiction, which determines which court is allowed to hear a case.
    – ohwilleke
    Commented yesterday
2

Does HM Courts and Tribunal Service profit from court fees for litigants unconnected to the UK?

No.

In the 2022-2023 fiscal year, the English Court system has expenditures of £2,307,628,000 and income from court fees and other court charges of £782,685,000, and handled 3.8 million cases (38% of which were criminal). About 25% of overall court system operating costs are recovered from fees charged to litigants.

At a crude level, the system spends a little less than £400 per case, net of filing fees. But this varies wildly by case type.

In the U.K. Supreme Court and Judicial Committee of the Privy Council, which share a budget:

In financial terms, the Court's net operating expenditure decreased to £5,029k (from £6,218k in 2021-22). The Accounts show that the UKSC and JCPC incurred total expenditure of £13,116k during 2022-23 (£7,408k of which was judicial and staff costs) and recouped £8,087k in Court fees, contributions from the UK court services and other income. The Statement of Comprehensive Net Expenditure represents the net total resources consumed during the year. The results for the year are set out in the Statement.

This is not cheap for a court that conducts only 112 hearings and renders just 98 judgments per year, which is in the ballpark of £50,000 per case, although a significant minority of that court's expenditures are basically financing its role as a tourist attraction and public government information source for the court system as a whole.

According to the Ministry of Justice as of July 2021 (at pages 16-18), the Crown Courts handle and dispose of about 30,000 new cases a year, and have about 70,000 case backlog from prior years, while the Magistrate's Courts handle about 325,000 new cases a year, and have roughly 325,000 backlogged cases.

In Crown Court, there is a £280,000 average courtroom cost per year, and there are 664 judges who collectively handle about 30,000 cases a year, which is about 45 cases per judge per year. This is about £6,222 per serious criminal case.

Expenditures per case in civil cases are smaller and are offset to a much greater extent per case by court fees for litigants. In civil cases, fees are collected when cases are filed, for the most part, but a large percentage of those cases result in default judgments or settlements that require only minimal judicial resources. And, unlike criminal court costs which often go unpaid, in civil cases, the percentage of the fees imposed by the court system that are actually paid is very high.

Certainly, the percentage subsidy for each criminal cases is much larger than in civil cases. So the percentage of net judicial expenditures needed to pay for the criminal docket's 38% of the overall system case load is far in excess of 38% of the net court system budget.

Minor criminal cases in magistrate's court, and minor civil cases in county court, are much less expensive to the system per case than serious criminal cases in Crown Court, and it is hard to figure out what the net cost per case is for general jurisdiction court civil cases in High Court and for family law cases.

District court judges who serve in magistrate's court and county court are paid about £30,000 less per year than Crown Court judges, making the cost per courtroom about £250,000 per year, and there are about 400 of them. Assuming that 325 of them serve in Magistrate's Court and 85 serve in County Court (which is probably a modest overestimate of the staffing in Magistrate's Court v. District Court), each District Court judge handles about 1,000 minor criminal cases per year at an average cost of £250 per minor criminal case, and some small percentage of that cost is offset by collected fees and court costs in minor criminal cases.

The filing fee in a very small county court civil case in England is £35, which is probably some subsidy. But county court mostly handles routine small collection cases, so the percentage of county court civil cases which produce default judgments is very high (probably more than 90%). Default judgment cases involve minimal judicial effort so the subsidy in these cases might actually not be all that great.

And, in both Magistrate's Court and County Court, when these cases do go to trial, the judicial effort involved in the pre-trial procedures is often quite modest, and the trials themselves are often short (they average less than four hours each). Also, trials of minor criminal cases in Magistrate's Court are simplified and shortened because in the U.K. minor criminal cases are not tried to juries.

The concern in the question is mostly about High Court civil cases with large amounts in controversy. The filing fees in these cases are high and are almost always collected.

For example, while the filing fee in High Court, as noted in the question for a case involving "More than £200,000" is £10,000. Yet, an important minority of those cases will produce default judgments with a minimal expenditure of judicial effort, and far more than a majority of those cases will settle prior to trial with only fairly modest judicial effort.

So, after the costs of handling cases the produce default judgment or settle are considered, the amount of fee income left to finance the judicial effort of the big cases that go to trial or have to be litigated on the merits in expensive motion practice may be closer to £80,000-100,000, which is about a third the cost of maintain a judge with the judge's staff and courtroom per year. Thus, the subsidy per case in civil cases with a large amount in controversy is actually pretty modest on average.

In sum, the U.K. government no doubt subsidizes court fees for litigants unconnected to the U.K. But, it isn't really true to say that they are completely unconnected to the U.K., because there must be at least some connection to the U.K. for its courts to have jurisdiction over the cases, beyond just a choice of U.K. law in a contract.

The percentage of cases with weak U.K connections that are litigated in the U.K. is small, and the subsidy per case in civil lawsuits with a large amount in controversy is modest.

My back of napkin estimate is the "unconnected cases" make up less than 1% of the overall 3.8 million case criminal and civil case load of the English cases, and probably collectively cost taxpayers in the U.K. not more than £5 million to £10 million a year, which is money well spent in terms of developing the "soft power" of the U.K. internationally.

You must log in to answer this question.