Disputes Tribunal cap could double from $30,000 as new bill goes to first reading

The Disputes Tribunal's cap could be doubled from $30,000 to $60,000. Photo / Greg Bowker

A master’s student who was paid just $9000 for a full year’s worth of work had to cut her losses and abandon claiming for a quarter of the $41,000 she was owed.

This was because the Disputes Tribunal, where she took her fight for payment, has a cap of $30,000 on awards it can make.

However, today a piece of legislation which could see that $30,000 cap doubled to $60,000 will go to its first reading before Parliament.

The Disputes Tribunal, which is still colloquially known by its former title, the Small Claims Court, is one of the main ways in which roughly 11,000 New Zealanders every year access justice.

With claims costing as little as $59 to lodge and no lawyers allowed, the tribunal was designed as a quick and effective means through which to settle small disputes without clogging up the district and higher courts.

While many of the cases can seem trivial in nature – like that of a woman who sued her boyfriend for failing to take her to the airport on time, or a couple who took a restaurant to the tribunal after their bottomless brunch turned out to have a limit – the tribunal allows for people with limited means to seek justice on an equal footing.

“We need to improve court timeliness and access to justice so that Kiwis and get on with their lives,” Justice Minister Paul Goldsmith said of the bill.

“Court delays affect everyone, the profession included. It just takes one thing [being] out of place and everything grinds to a halt. Another adjournment. Justice delayed once more.”

“The tribunal is a quick and inexpensive way for New Zealanders to settle civil disputes without expensive legal fees. This comes at a time when low-cost dispute resolution is increasingly important for many.”

Goldsmith said Ministry of Justice modelling indicated roughly 2000 claims per year could benefit from an increase in the tribunal’s jurisdiction, including new claimants who would have abandoned part of their claim to fit within the $30,000 cap.

“Improving court timeliness is a key component to restoring law and order to New Zealand, and ensuring victims are returned to the hearth of the justice system,” Goldsmith said.

The Government has also agreed to change the law to allow Disputes Tribunal referees to order that losing parties must pay the cost of the filing fee back to the applicant. Filing fees can range from $59 to $234 depending on the size of the claim.

Associate Professor Bridgette Toy-Cronin is the director of Otago University’s Civil Justice Centre and told NZME awarding the filing fee to applicants was a symbolic gesture that helped people’s sense of justice.

Toy-Cronin said she saw raising the cap as a good thing and which would help bring the tribunal’s jurisdiction in line with inflation and ease the burden of cost of living difficulties in the country at the moment.

“The Disputes Tribunal is meant to be a cost-effective prompt way of resolving disputes, and it’s useful if it can hear a broader range of those disputes,” she said.

“I think this is a useful part of the overall puzzle of how we deliver civil justice in New Zealand.

“I think it’s a useful contribution to the cap to recognise a change in our financial circumstances.”

Last year, a Courts of New Zealand rules committee report recommended raising the tribunal’s cap to $70,000, and to $100,000 by consent from both parties to bring it in line with other civil tribunals like the Tenancy and Motor Vehicle Disputes Tribunal.

That report also recommended a general right to appeal orders between $30,000 and $100,000 made by the tribunal to the district court.

At present, the Disputes Tribunal cannot enforce its own orders and requires a separate debt enforcement order from a district court if a losing party fails to pay up. The Rules Committee suggested the courts think of a way to streamline this process.

Jeremy Wilkinson is an Open Justice reporter based in Manawatū covering courts and justice issues with an interest in tribunals. He has been a journalist for nearly a decade and has worked for NZME since 2022.