A move in the right direction
Lifting the maximum claim level of the Disputes Tribunal to $15,000, or $20,000 with the consent of both parties, is "a move in the right direction," according to Andrew Beck, Convener of the NZLS Civil Litigation & Tribunals Committee.
He was commenting on the 4 February announcements by Prime Minister John Key and Justice Minister Simon Power. The Prime Minister said the Government would expand the jurisdiction of the Disputes Tribunal and Simon Power announced the claim level increases.
The current maximum claim levels of $7,500, or $12,000 with party consent, have been in place since 1998.
“This is a matter that the Civil Litigation & Tribunals Committee has been agitating for for some time and as such it is to be welcomed,” Andrew Beck said. “However, I suspect that they have not gone far enough. It has certainly gone some of the way, though, and that’s got to be a good thing.”
In an issues paper about the Disputes Tribunal, the committee had sought a maximum of $15,000 or $25,000 with the consent of the parties and had written to the new Minister in November reiterating that view.
Andrew Beck said two matters relating to the Disputes Tribunal would still be of concern to the committee. One was that the maximum claim levels would still be too low. The other matter related to the qualifications of referees. Although many of the referees were legally qualified, that was not a requirement of the position, Andrew Beck said.
“The qualification of referees is one of the concerns, particularly if you are dealing with more money. There is a concern that if you don’t have legally qualified people, you could get maverick results,” he said.
When announcing the increases, Simon Power said: “Being tied up in District Court dealing with small claims is one of the trouble spots for small businesses – it costs them valuable time and money.
"This change will reduce costs in up to 3,600 cases a year which will now be able to be held in the Disputes Tribunal. Previously these cases would have been held in the District Court and many would not have been pursued due to the costs involved.
"This is designed simply to lighten the load on small and medium-size business so they can get on with the business of producing goods and services."
New legislation is required to raise the maximum claim levels, and the Minister of Justice’s office told LawTalk that Simon Power had asked for the bill expanding the Disputes Tribunal to be “pushed forward”.
The expansion is part of a five-part package. The other parts are tax changes, expanding the role of the Export Credit Office, expanding business advice services and creating a fast-payment requirement for government agencies.
Principal Disputes Referee Dr Peter Spiller, who wrote about the Disputes Tribunal’s ability to handle larger claims in LawTalk 722, (2 February 2009), has also welcomed the proposed increase, though he would also like to see a wider review of the tribunal.
“I am very supportive of the Government’s announcement. The proposal to increase the tribunal’s jurisdiction in the very near future addresses a problem of access to justice that has become pressing.
“The $7,500 limit, set in 1998, had become eroded in value and parties were increasingly having to abandon part of their claim because they could not afford to take their claim to the District Court. The increase to $15,000 more than addresses the erosion in value of the previous limit.
“However, I hope that the Government will soon undertake a broader review of the Disputes Tribunals Act, which is now 21 years old. The review needs to address issues such as allowing undisputed debts to be heard and expanding the grounds of appeal beyond procedural unfairness.
“In the light of this broader review, the stage could be set for a further and more significant increase in the tribunal’s jurisdiction,” Peter Spiller said.