Adjustment in the Norwegian Dispute Act – chasing efficiency and reduced costs

Several changes to the Norwegian Dispute Act have recently entered into force. The adjustments aim to enhance efficiency, the court's involvement and to reduce costs. What will the changes imply for those seeking assistance from the courts in civil disputes?

The Norwegian Dispute Act establishes the procedural framework for how civil cases are handled by Norwegian courts. In May 2023 the Norwegian Parliament adopted a bill introducing several adjustments to the Dispute Act of 2005. The majority of these changes entered into force on 1 July 2023 and the remaining changes will enter into force on 1 January 2024.

The overall purpose of the proposals is according to the Ministry of Justice and Public Security's ("MJP") white paper to achieve a more efficient administration of justice, more active case management and a greater degree of proportionality in the process. The ultimate goals are thus to contribute to lower costs for the parties and society and secure access to court for the public.

In short, the main adjustments in the Disputes Act can be summarized as follows:

1. More active case management (will enter into force 1 January 2024)
   In order to achieve a more efficient process, the courts are requested to put more focus on the initial case management conference where the plan for the administration of the case is discussed between the parties and the court. The changes will highlight the court's obligation to clarify the disputed issues at an early stage. The courts will also have an obligation to initiate early discussions on limiting the amount of documentation/evidence
   
   
2. Advanced deadline for end of preparations for trial (will enter into force 1 January 2024)
   Currently the deadline for end of preparatory proceedings is set to two weeks before the oral hearing is scheduled. This will now be changed to three weeks in order to prevent late submissions of evidence and late (new) argumentation.
   
   A deadline of three weeks instead of the ordinary two has already in practice been an established norm in several courts. The adjustment will therefor only have limited impact.
   
   
3. Claim for legal fees shall be substantiated/specified in more detail (in force from 1 July 2023)
   The court will when deciding the main issues of the case also assess the parties claim for legal costs. Under Norwegian law, the starting point is that the winning party is entitled to coverage of his legal costs (lawyers' fees, cost of expert witnesses, travel costs etc). Until now, the Dispute Act has requested that all claim for legal fees should be specified in order to give the court a sufficient basis to assess the claim. In the adjusted version of section 20-5 the parties are now not only requested to specify their claims, but also to substantiate them. This will imply the parties will have to give more information on what elements and what kind of work the case preparation has involved. The objective of the adopted change is to give the court a better basis for assessing whether the claims are justifiable. The rationale behind the adjustment is understandable as long as the exercise does not become too time consuming in itself. Another potential problem with the adjustment is that a party can have legitimate reasons for not wanting to reveal all details from its preparations.
   
   Another change when it comes to legal costs, is that the Dispute Act now dictates that the court in its decision should reference the possibility of having legal costs assessed/decided by the court if the costs significantly exceed what is considered reasonable.
   
   
4. Reduced threshold for refusing appeals (in force from 1 July 2023)
   The Court of Appeals have the authority to refuse an appeal and thereby stop the case from being reheard. Until now, the key requirement for refusing an appeal has been that the Court of Appeal could refuse an appeal if it was found "clear" – based on the appeal/defence pleading – that the appeal would not succeed.
   
   This threshold has now been slightly lowered and the stated objective is to slightly limit the number of cases being heard by the appeal court. The condition has been changed so that the Court of Appeal now can refuse an appeal if it finds that there is a "clear preponderance of probability" that the appeal will not succeed.
   
   
5. More use of court assisted mediation (in force from 1 July 2023)
   On of the dispute resolution tool on the court's "menu" in civil cases is court assisted mediation where a judge act as a mediator and tries to assist and gently "push" the parties to reach an amicable solution. The courts' experience is that such mediations have a high success rate measured on the basis of how often such mediations result in a settlement (approx. 70 percent of cases mediated by the courts).
   
   Until now, mediation has in practice been reserved for cases where both parties agree to mediate. The Dispute Act has provided that court assisted mediation against the will of the parties can only be decided when special reasons dictate it. This provision has however now been removed, and the Dispute Act now states that the courts are obligated to decide on mediation if the court finds that the case is suited for mediation.
   
   The objective of the change in wording, is to try to increase the number of cases where mediation is attempted. Time will show to what extent the courts in fact will instruct the parties to participate in court assisted mediation against their expressed will. The chance of reaching a settlement will here have to be measured against the possible added costs of an unsuccessful mediation attempt.

The adopted changes have alle been introduced in order to enhance efficiency and potentially reduce costs. Several of the adjustments appears to be well considered and reasonable. However, both increased documentation/substantiation requirements, requirement on finalizing case preparations earlier and the possibility of deciding court assisted mediation against the will of the parties comes with a cost. Time will tell whether the imposed changes have managed to strike the right balance between cost and effect.