Courts Bill may drive up legals costs, awards and insurance premiums

Minister for Justice Alan Shatter has said the existing monetary limits have rendered the District and Circuit Courts redundant in respect of some classes of civil proceedings. Photograph: Dara Mac Dónaill/The Irish Times

Minister for Justice Alan Shatter has said the existing monetary limits have rendered the District and Circuit Courts redundant in respect of some classes of civil proceedings. Photograph: Dara Mac Dónaill/The Irish Times

Sat, Jul 13, 2013, 09:38

Insurers have joined their voice to those warning the Government that increasing the monetary limits of cases dealt with by the District and Circuit Courts will drive up litigation, legal costs and awards.

Insurance Ireland has said increases from € 6,350 to € 15,000 for District Court cases and € 38,000 to € 60,000 for Circuit Court cases as set out in the Courts Bill 2013 should be postponed.

Minister for Justice Alan Shatter has said the existing monetary limits have rendered the District and Circuit Courts redundant in respect of some classes of civil proceedings.


Domestic market
Insurance Ireland, which represents 95 per cent of insurers in the domestic market, says better infrastructure is needed before the proposed increases can be introduced.

Increasing the limits without improving infrastructure will drive up awards, legal costs and litigation and reduce the number of cases dealt with by the Injuries Board, the body says.

This would in turn hike up premiums for consumers and businesses.

Insurance Ireland’s non-life manager Michael Horan says the Government should postpone the increases until a new legal costs regime, which will flow from the Legal Services Regulation Bill, is in place.

“It would be inadvisable and very costly, in our view, to increase the monetary limits of the District and Circuit Courts until the new regime is in place and is shown to be successful in controlling legal costs,” Mr Horan said.


Monetary limits
He also questioned the capacity of the lower courts to deal with the increased workload ensuing from increased monetary limits.

“Insurance Ireland has a strong concern that the District and Circuit Courts would not be able to cope with heavier caseloads based on present levels of resourcing.

“We believe that more consideration needs to be given to the capacity of the lower courts to cope before the proposed monetary limit increases are implemented.”

The statement follows similar calls from the Irish Brokers Association who this week said the Courts Bill, which passed second stage in the Dáil yesterday, would end up costing consumers approximately 30 per cent more in premiums.


Real danger
Chair of the Injuries Board Dorothea Dowling, agreed saying there was a real danger the Bill would reverse declines in the cost of insurance.

President of the Law Society James McCourt has said he has “grave concerns” about the measure.

The proposed law, he said, will probably increase delays not just for civil cases, but also for criminal and family law matters as resources are directed towards dealing with the increased civil caseload.