Pre Action Protocols – what the hell are they, and how are they helpful to Wedding Suppliers?

I posted earlier in the week in #yourlegalfairygodmother Facebook group about how the Pre Action Protocols (PAP) might be a useful tool for Wedding Suppliers if you have a customer who is pressing you for a response or a repayment within an unreasonably short period of time – or is being unnecessarily aggressive about their pursuit of a repayment in this Covid 19 madness.

The PAP will not help you much if you really do owe the money back, but where there is a genuine dispute about whether a sum is refundable or not, or if a contract is truly ‘frustrated’,  it can help to slow down a rushing and aggressive opponent, who is threatening to sue you “tomorrow” without having properly undertaken any pre issue actions. That is what the PAP sets out.

So how does it apply?

Almost all claims for the recovery of money when someone alleges breach of contract are started in the County Court. Where they are issued and how they are run in the court will usually depend on the amount of money claimed. In simple terms, if your claim is below £5,000.00 it will usually fall into the Small Claims Track of the County Court.

I’m going to deal with the sorts of claim in this blog – similar rules apply for claims of a larger amount in different Tracks, but there are significant differences: so be careful!

Before someone can issue a claim for breach of contract (in the current situation, this would probably be a claim for a refund of monies already paid to a supplier for services ‘not now rendered’…) the Civil Procedure Rules  and the associated Practice Directions  set out the procedures they must follow BEFORE and once they issue a formal claim. The PAPs are set out in Practice Directions which detail their purpose, and what information needs to given to a prospective Defendant in an action by the prospective Claimant before the case is issued.

  • It includes information about how the claim arose, what the factual and legal basis for the claim is, and how the loss is calculated.
  • It puts duty on both parties to explore if the dispute can be resolved by any other method than a formal claim, sometimes called ADR (Alternative Dispute Resolution)

The main purpose of the PAP is to make prospective Claimants set out their case properly, to give a prospective Defendant a reasonable opportunity to consider their case and if they chose to take legal advice, engage in meaningful attempts to settle without the need for a court action, and to be clear about the legal and factual basis of their claim.

The CPR rules that apply to all civil actions only really kick in once the claim has been issued, but the Practice Directions and the PAP applies to pre issue behaviour.

There are some specific PAPs which apply to different sorts of claim – probably the most commonly encountered one for small businesses is the PAP for debt claims which MUST be followed where a business may have provided goods and/or services, invoiced for them, but has not been paid – you can look at that here.

There is NO specific PAP for a small claims action, but the court has a Practice Direction that applies to any claim where no specific PAP exists – it can be viewed here – and it will expect parties to comply in a way that is proportionate to the complexity and value of the claim ( put simply if the claim is for a small and simple amount you need to have less pre issue activity). Most importantly if a party does not comply with the Practice Direction, it sets out what sanctions the court could impose.

If you have a customer who is aggressively threatening a claim, and giving you unreasonably short timelines for response, you may like to remind them of the obligations under the PAP in words something like this:

I understand that parties to a potential claim should comply with the Practice Directions, where relevant, the correct Pre Action Protocol,  and the Civil Procedure Rules, and must set out the legal and factual basis of the claim, and any defence, and try to see if a settlement can be reached, and to avoid unnecessary litigation if at all possible.

I am trying to comply with these rules and you also need to comply with your obligations under the Practice Directions before you issue a claim in the court. There are consequences for non-compliance. I will draw this correspondence and any other pre action behaviour to the attention of the court if a formal claim is issued.

Other helpful info on money claims on line can be found here: https://www.moneyclaim.gov.uk/web/mcol/welcome

Remember: some words of warning:

  • The Small Claims Track is designed to be a forum for parties to claim without using lawyers, and is, in many ways, a simplified process and a bit of a ‘down and dirty’ way to get to a judgment.
  • A party can bring a claim for breach of contract at any time within 6 years of the date of the breach – in simple terms – so any formal claim arising from a dispute does not need to be issued immediately, or even this year.
  • The Court Service and the Claims Online Service are currently struggling with the effects of Covid 19 too, and most civil processes have been interrupted or suspended so that the court can concentrate on only vital hearings and processes.
  • Please check carefully if you are intending to issue a claim, or if you have received notification of a claim against you, to ensure you comply with any deadlines by which you may have to act. There MAY be changes as a result of the limitations imposed on the Court Service: PLEASE CHECK