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Pre Action Protocol

Commencement:

The Pre Action Protocol came into force on 6 April 2009 as part of the 49th Amendment to the Civil Procedure Rules.

Background:

This protocol is important to landlords and agents as it will apply to possession and money-claim court actions. Specific area protocols have been part of the Civil Procedure Rules (CPR) for many years. These Rules control the operation of the court system and those who use it. However, the significance and importance of these are that they apply to ALL cases other than those where there are specific protocols. The objectives of pre-action protocols are to encourage the exchange of early and full information about the prospective legal claim, enable parties to avoid litigation by agreeing a settlement of the claim or by using a form of Alternative Dispute Resolution (ADR) before the commencement of any proceedings and to support the efficient management of proceedings where litigation cannot be avoided. Protocols are intended to be enforced by the courts using costs and other penalties.

Scope of new Protocol:

This protocol will apply to all potential legal actions not specifically covered by individual area protocols and those specifically excluded in the Protocol. For more details of these areas and the rules as a whole see the CPR website at www.justice.gov.uk/civil/procrules_fin/menus/rules.htm. All money claim and possession actions will be covered by these catch-all provisions. The impact on section 21 and 8 claims will be limited.

Principles of this protocol
The parties should before starting an action:

  1. exchange sufficient information about the matter to allow them to understand each other’s position and make informed decisions about settlement and how to proceed, and
  2. make appropriate attempts to resolve the matter without starting proceedings, and in particular consider the use of an appropriate form of ADR in order to do so.

The parties should act in a reasonable and proportionate manner in all dealings with one another. In particular, the costs incurred in complying should be proportionate to the complexity of the matter and any money at stake. The parties must not use this Practice Direction as a tactical device to secure an unfair advantage for one party or to generate unnecessary costs.

Information exchange
Before starting proceedings:

  1. the claimant should set out the details of the claim by sending a letter before claim to the defendant, and
  2. the defendant should give a full written response within a reasonable period.

A ‘reasonable period of time’ will vary depending on the matter. As a general guide –

  1. the defendant should send a letter of acknowledgment within 14 days of receipt of the letter before claim;
  2. where the matter is straightforward, for example an undisputed debt, then a full response should normally be provided within 14 days;
  3. where a matter requires the involvement of an insurer or other third party or where there are issues about evidence, then a full response should normally be provided within 30 days;
  4. where the matter is particularly complex, for example requiring specialist advice, then a period of longer than 30 days may be appropriate;
  5. a period of longer than 90 days in which to provide a full response will only be considered reasonable in exceptional circumstances.

Annexes A & B
Annex A sets out detailed guidance on a pre-action procedure that is likely to satisfy the court in most circumstances where no other pre-action protocol applies and where the claimant does not follow any statutory or other formal pre-action procedure. Annex B sets out the specific information that should be provided in a debt claim by a claimant who is a business against a defendant who is an individual.

Alternative Dispute Resolution
Starting proceedings should usually be a step of last resort, and proceedings should not normally be started when a settlement is still actively being explored. Although ADR is not compulsory, the parties should consider whether some form of ADR procedure might enable them to settle the matter without starting proceedings. The court may require evidence that the parties considered some form of ADR

The Legal Services Commission has published a booklet on ‘Alternatives to Court’, CLS Direct Information Leaflet 23 (www.clsdirect.org.uk) which lists a number of organizations that provide alternative dispute resolution services. The National Mediation Helpline on 0845 603 0809 or at www.nationalmediationhelpline.com can provide information about mediation.

Annex A:

This Annex sets out detailed guidance on a pre-action procedure that is likely to satisfy the court in most circumstances but it is not intended to apply to debt claims covered by Annex B.

Claimant’s letter before claim
The claimant’s letter should give concise details about the matter. This should enable the defendant to understand and investigate the issues without needing to request further information. The letter should include:

  1. the claimant’s full name and address;
  2. the basis of the claim;
  3. a clear summary of the facts on which the claim is based;
  4. what the claimant wants from the defendant, and
  5. if financial loss is claimed, an explanation of how the amount has been calculated.

The letter should also—

  1. list the essential documents on which the claimant intends to rely;
  2. set out the form of ADR (if any) that the claimant considers the most suitable and invite the defendant to agree to this;
  3. state the date by which the claimant considers it reasonable for a full response to be provided by the defendant, and
  4. identify and ask for copies of any relevant documents not in the claimant’s possession and which the claimant wishes to see.

Unless the defendant is known to be legally represented the letter should—

  1. refer the defendant to this Practice Direction and in particular draw attention to the court’s powers to impose sanctions for failure to comply with the Practice Direction, and
  2. inform the defendant that ignoring the letter before claim may lead to the claimant starting proceedings and may increase the defendant’s liability for costs.

Defendant’s acknowledgment
Where the defendant is unable to provide a full written response within 14 days the defendant should, instead, provide a written acknowledgment within 14 days.

The acknowledgment should:

  1. state whether an insurer is or may be involved;
  2. state the date by which the defendant will provide a full written response; and the defendant should give reasons why a longer period is needed.

If the defendant does not provide either a letter of acknowledgment or full response within 14 days, and proceedings are subsequently started, then the court is likely to consider that the claimant has not complied with the Protocol.

Where the defendant is unable to provide a full response within 14 days because the defendant intends to seek advice then the written acknowledgment should state from whom the advice will be sought and when this is likely to occur, usually within 14 days.

Defendant’s full response
The defendant’s full written response should accept or deny the claim.

Unless the defendant accepts the whole of the claim, the response should:

  1. show the reasons for not accepting;
  2. any counterclaim with supporting information;
  3. if the defendant alleges that the claimant was wholly or partly to blame for the problem that led to the dispute, summarise the facts relied on;
  4. state whether the defendant agrees to the claimant’s proposals for ADR and if not, state why not and suggest an alternative form of ADR or state why none is considered appropriate;
  5. list the essential documents on which the defendant intends to rely;
  6. enclose copies of documents requested by the claimant, or explain why they will not be provided, and
  7. ask for copies of any further relevant documents, not in the defendant’s possession which the defendant wants.

If the defendant does not provide a full response and a claim is subsequently started, then the court is likely to consider that the claimant has complied with the Protocol.

Claimant’s reply
The claimant should provide the documents requested by the defendant within as short a period of time as is practicable or explain in writing why the documents will not be provided. If the defendant has made a counterclaim the claimant should provide information equivalent to the defendant’s full response.

Annex B:

Information to be provided in a debt claim where the claimant is a business and the defendant is an individual.

The claimant should:

  1. provide details of how the money can be paid, for example the method of payment and the address to which it can be sent;
  2. state that the defendant can contact the claimant to discuss possible repayment options, and provide the relevant contact details, and
  3. inform the defendant that free independent advice and assistance can be obtained from organizations including those listed below.

The information set out here may be provided at any time between the claimant first intimating the possibility of court proceedings and the claimant’s letter before claim.

Where the defendant is unable to provide a full response within the time specified in the letter before claim because the defendant intends to seek debt advice then the written acknowledgment should state from whom the advice is sort and when this advice is expected, usually within 14 days.

But the claimant need not allow the defendant time to seek debt advice if the claimant knows that the defendant has already received relevant debt advice and the defendant’s circumstances have not significantly changed, or if the defendant has previously asked for time to seek debt advice but has not done so.

Practicalities:

All potential court users are now going to have to fit into the constraints set out in this protocol when either seeking possession of a property or rent arrears. It may therefore be necessary to change the contents of standard letters to accommodation these requirements. The following checklists, overleaf, indicate those requirements for information set out in the Protocol.

For further information:

This summary is intended to assist landlords and letting agents to understand the effect of the these provisions. It is not an authoritative interpretation - this is a matter for the courts. For more detail, you should refer to the text of the protocol.

Checklist:

First letter of claim – should contain the following:

  • your full name and address;
  • the basis of the claim;
  • a clear summary of the facts on which the claim is based;
  • what you want from the defendant;
  • if financial loss is claimed, an explanation of how the amount has been calculated.
  • list the essential documents on which you intend to rely;
  • if any ADR is suitable invite the defendant to agree to this;
  • state the date you consider it reasonable for a full response to be provided by the defendant;
  • identify and ask for copies of any relevant documents not in your possession and which you wish to see, and
  • unless the defendant is known to be legally represented the letter should refer the defendant to the Practice Direction, in particular drawing attention to the court’s powers to impose sanctions for failure to comply with the Practice Direction, and inform the defendant that ignoring the letter before claim may lead to the claimant starting proceedings and may increase the defendant’s liability for costs.

Debt claims by a business should additionally:

  • provide details of how the money can be paid, for example the method of payment and the address to which it can be sent;
  • state that the defendant can contact you to discuss possible repayment options, and provide the relevant contact details, and
  • inform the defendant that free independent advice and assistance can be obtained from organizations including those listed in the Protocol.

Second Letter
You should provide any documents requested by the defendant within as short a period of time as is practicable or explain in writing why the documents will not be provided. If the defendant has made a counterclaim, for example that you have on protected the deposit, you should provide information equivalent to the defendant’s full response.

This means that you need to:

  • show the reasons for not accepting the counterclaim;
  • if the defendant alleges that you were wholly or partly to blame for the problem that led to the dispute, summarise the facts you rely on for countering their assertion, and
  • list the essential documents on which you intend to rely to counter their assertion.