Two former members of the Civil Justice Council’s (CJC’s) funding review working party have hit out at the continued lack of government action on its proposals a year after they were unveiled.
Nicholas Bacon KC and Dr John Sorabji both served on the CJC’s working party on litigation funding, which published its final report on 2 June last year, with Sorabji acting as co-chair with Mr Justice Simon Picken.
Alongside its core recommendation for the introduction of a “light touch” regulatory regime for litigation funders, the report called for legislation to be enacted “as soon as possible” to reverse the impact of the 2023 House of Lords PACCAR judgment.
The judgment is considered to have rendered thousands of litigation funding agreements (LFAs) unenforceable after ruling that they were damages-based agreements (DBAs).
A bill introduced by the last government to reverse PACCAR fell before the 2024 general election and although the Labour government vowed to introduce legislation in December 2025, a bill is yet to materialise.
In comments marking the report’s anniversary, Bacon warned that without urgent action, the UK "risks jeopardising" its dominance as a global venue for dispute resolution.
“A huge amount of work goes into producing reports of this kind and the lack of any progress on the recommendations which were welcomed by the government at the time, is terribly frustrating from a personal point of view,” he said.
He added: “Personal views aside, there are sound policy reasons why urgent steps should be taken to advance the CJC recommendations. The longer they are left unresolved, the greater the damage likely to follow. There are doubtless cases which remain bogged down in satellite litigation that would simply disappear with the implementation of the PACCAR recommendations.
He said the existing DBA regime was “not fit for purpose in a modern, accessible legal system”, warning that the UK risked losing its dominant position as a disputes centre due to the lack of “appropriate mechanisms for funding and the sharing of risk to pursue claims”.
Sorabji noted there was “continuing uncertainty in the litigation funding market and injustice continuing to arise where historic funding agreements are concerned”.
Those tensions were equally prevalent, he said, in relation to present and future funding, adding: “There is an ever-more urgent need for the Government to act, to implement the reversal of PACCAR both retrospectively and prospectively, to implement effective, proportionate regulation.”
Sorabji, a former senior advisor to the Lord Chief Justice, has authored a Nuffield Foundation report arguing that four major reviews of civil justice, from 1988 onwards, had also failed to address access-to-justice issues, exacerbated by a lack of institutional support.
During a session before the Justice Select Committee earlier this week, courts minister Sarah Sackman KC confirmed the UK government would overturn the PACCAR ruling alongside implementing the CJC review’s other recommendations.
Acknowledging “the many competing priorities the government has," she said, “one silver lining of the delay” was that it gave the Ministry of Justice “further time to consider more holistic or wholesale changes that might be desirable”.
When reform of PACCAR failed to make the latest legislative programme as set out in the King’s Speech last month, there was disappointment from across the disputes community.
Anthony Maton, senior partner at Hausfeld, saw this as a disappointing omission, decrying the fact there was no place “for what is a simple piece of legislation, drafted by the last government”.
“Meanwhile, access to funding and hence to justice continues to be significantly reduced. Absent change, the rights of consumers and small businesses will continue to wither on the vine.”
“Clarity in the law and consistency in its application is key to any modern functioning legal system. Uncertainty is undesirable,” he said.
Jeremy Marshall, chief investment officer of Winward Litigation Finance, agreed. He said the government had misunderstood “what increased uncertainty means in practice for the litigation funding industry and our appetite to invest in the UK’s legal economy”.
He added: “We take pride in the UK being the Rolls-Royce standard for legal services in the world, but they come with Rolls-Royce prices, which makes the need for funding legal actions brought by consumers and businesses in the UK even greater.”
The latest comments by two former members of the CJC review underline the frustration that continues to build over the government's inaction.
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