European Small Claims Procedure - A Useful Alternative for Dispute Resolution

European Small Claims Procedure

The European Small Claims Procedure (“ESCP”) provides consumers and businesses across the EU with a quick and affordable dispute resolution process. The ESCP currently applies to claims up to €5000 in value and was introduced by EC Regulation 861/2007. The ESCP applies between all Member States of the EU except Denmark.

The general rule under the ESCP (although there are exceptions) is that proceedings must be issued against a defendant in the courts of the Member State in which they are domiciled. For England and Wales, this means that a claim must be issued in the County Courts. Some of the benefits of using the ESCP include:

· The fact that the procedure is conducted entirely in writing (unless the court deems an oral hearing is necessary);

· The courts will serve Defendants which dispenses with the cost and aggravation of applying to the court for service out of jurisdiction;

· ESCP judgments are automatically enforceable across the EU;

· Reasonable legal costs are recoverable (although parties do not necessarily require legal representation); and

· Interest is recoverable.

The ESCP requires a claimant to complete the relevant proforma containing details of the parties and the dispute. The Claimant is also expected to attach key documents to the proforma. On receipt of the proforma the court will initiate legal proceedings by issuing the claim and serving the proforma and Response Form on the Defendant(s) within 14 days.

The Defendant(s) will have 30 days to respond to the Claim and/ or issue any counterclaim.

Upon Expiry of the 30 day deadline the court must either give a judgment on the small claim, or request further details in writing from either party, or alternatively summon the parties to an oral hearing.

Once judgment is obtained under the ESCP it is automatically enforceable in all EU Member States. There is no scope to challenge the enforceability or recognition of a judgment obtained under the ESCP.

The benefits of having a uniformed procedure for small-claims proceedings and enforcement are clear. The UK is on course to leave the European Union, and the Brexit negotiations are well underway. The message from Government appears to suggest that there will be no change in the way EU and UK laws interact in the transition period (currently scheduled to end in December 2020). What remains unclear is whether any provision will be put in place post-Brexit to replace the ESCP, and if so what form that might take.

ENDS

Notes for editors

By Kumarlo Menns & Ellena Georgaki

Contact: E: kumarlo.menns@montpelier-solicitors.com

T: +44 (0)207 199 3611

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