Litigation Funding Agreements (Enforceability) Bill 2024

The government took action to resolve the disruption sparked by the Supreme Court’s decision in PACCAR by presenting a bill in the House of Lords.

Conservative peer Lord Evans of Rainow introduced a measure aimed at addressing the enforceability of litigation funding agreements and related services in a concise statement. The Litigation Funding Agreements (Enforceability) Bill has been officially released.

Nicolas Bacon KC, a prominent figure in costs and funding law from 4 New Square, expressed approval for the introduction of the bill, hoping it signals the resolution of issues stemming from the PACCAR ruling.

The litigation funding sector faced upheaval following the Supreme Court’s judgment in R (on the application of PACCAR Inc) v Competition Appeal Tribunal [2023] UKSC 28 last July, which deemed many such agreements unenforceable by categorizing them as damages-based agreements.

On March 4th, Lord Chancellor Alex Chalk announced plans to enact legislation reversing the contentious ruling. Chalk emphasized that the proposed legislation aims to facilitate public access to funding for legal battles against influential entities, such as those implicated in the Horizon scandal.

Speaking at Brown Rudnick’s litigation funding conference recently, Susan Dunn, chair of the Association of Litigation Funders, praised the government’s acknowledgment of the adverse effects of the PACCAR ruling.

The bill is expected to follow the regular legislative process and advance to the next stage as parliamentary scheduling permits.