CJC calls for urgent legislation to reverse PACCAR effects

CILEX has welcomed the Civil Justice Council’s (CJC) final report on litigation funding, which called for urgent legislative action to reverse the effects of PACCAR, the Supreme Court’s 2023 ruling that prompted its review.

Among the other headlines from the 150-page report were the introduction of “light-touch regulation” of funding, rejection of a cap on funders’ returns, backing for hybrid damages-based agreements and a revival of the long-running idea of a contingency legal aid fund, here called the Access to Justice Fund.

The PACCAR decision rendered numerous third-party funding agreements unenforceable, undermining access to justice for many individuals and small businesses.

CILEX agreed that a stronger and more comprehensive regulatory scheme was essential to promote transparency, protect individuals and ensure that ethical standards across the funding sector were being upheld.

CILEX, however, expressed reservations about the Access to Justice Fund. While there was a desperate need for funding in civil litigation, it was concerned that the introduction of the fund might inadvertently discourage private litigation funding, leading to a reduction in the availability of funders for meritorious claims and ultimately hindering access to justice instead of promoting it.

The CJC’s suggested mandating of the use of King’s Counsel (KCs) for independent legal advice for funded cases also raised concerns. CILEX said this “could impose significant financial burdens on claimants and their legal representatives”, potentially leading to delays in the courts system. To ensure efficiency and maintain access to justice, CILEX advocated for a more flexible approach allowing for the appointment of qualified independent legal advisers, not limited to KCs.

Then CILEX president Yanthé Richardson urged the government to carefully consider the proposals “to ensure they do not hinder rather than help access to justice”.