The UK government’s delay in legislating on litigation funding issues following the Supreme Court’s ruling in PACCAR Inc v Competition Tribunal has caused frustration in the litigation funding sector. Justice minister Lord Ponsonby indicated that no action will be taken until after the Civil Justice Council (CJC) completes its review of litigation funding, with a full report not expected until mid-2025. As a result, any new legislation is unlikely before 2026, see further regarding the Judgement PACCAR disguised DBA?
Reported in the Law Society Gazette This delay creates uncertainty around the enforceability of litigation funding agreements (LFAs), even those structured around safer financial models. With appeals challenging the validity of LFAs awaiting a hearing in the Court of Appeal, litigation funders are struggling to ensure the security of their agreements. To navigate this, many are shifting toward funding law firms directly, rather than individual cases. However, this approach introduces new challenges, as evaluating a firm’s financial health differs from assessing the merits of a legal case.
The delay raises concerns about access to justice, as funders hesitate to support claims without legal clarity, potentially leaving many claimants unable to pursue their cases.
