Small Claims Court's remit to cover small firms

THE REMIT of the Small Claims Court is to be extended to include small businesses, the Minister for Justice, Equality and Law Reform, Dermot Ahern, has announced.

Under the new legislation businesses can file claims against other businesses in respect of goods or services purchased up to the value of €2,000. However, claims cannot be made in respect of debts, personal injuries or breach of leasing or hire purchase agreements.

The Small Claims Court was introduced on a pilot basis in 1991 with the aim of offering consumers a way of pursuing complaints without recourse to a solicitor.

In 1993 the scheme was extended nationwide. It is administered through the District Court office.

Mr Ahern said yesterday that the extension of the scheme to businesses will provide a choice of legal routes to small businesses who want to pursue a small claim, as the current civil bill system will also remain available.

“This will allow a business choose whichever route, small claims or civil bill procedure, it considers most economic and appropriate to its circumstances.”

The Minister also said that he has requested the Company Law Review Group to review the current system whereby limited liability companies must engage legal representation for court-based proceedings.

The announcement of the extended scheme, which will come into effect on January 11th, was broadly welcomed by groups representing the small business sector yesterday.

Mark Fielding, chief executive of ISME, said that while the announcement was “a very small step in the right direction” and would help resolve smaller claims, ISME had hoped that the extended small claims procedure would cover claims up to €6,000, the current district court limit.

Fine Gael’s spokesman on enterprise, trade and employment, Leo Varadkar, who had called for the expansion of the scheme to include businesses last year, also expressed disappointment at the €2,000 limit.

He said that Fine Gael had been expecting a cap of €3,000 to be introduced.