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A balance must be struck in legal funding arrangements – CORLA Co-President Martyn Day, writes for The Times

January 25, 2024 by CORLA

As Alan Bates, the leader of the sub-postmasters’ campaign, has noted, it was financial backing that allowed the case to go to the High Court, writes Martyn Day in The Times

Litigation funding is here to stay – so let’s make it work for everyone.

The ITV series on the Horizon/Post Office scandal has highlighted the crucial value of litigation funding to victims of wrongdoing. When all other avenues were closed, funding from investors allowed the sub-postmasters to bring their case to court and get justice.

The former Conservative MP Seema Kennedy, chief executive of the paradoxically named lobby group ‘Fair Civil Justice’ – backed by the US and British Chambers of Commerce – cited the Horizon scandal as a reason to restrain litigation funding.

Her view was because most of the £58m settlement in the 2019 High Court group action, depicted in the ITV drama, went to lawyers and funders (because of the Post Office’s intransigence in defending the claims) justice had not been done.

Crocodile tears from the representatives of large corporations lacks credibility, but there is a discussion to be had.

In this instance, the percentage taken by the lawyers and funders was high but, as the leader of the sub-postmaster’s campaign Alan Bates pointed out in the Financial Times, funders… “allowed us to take our case from Fenny Compton Village Hall to the High Court, securing justice, exposing the truth, and clearing our names and reputations.”

One of the aims of my organisation, The Collective Redress Lawyers Association (CORLA), is to make sure arrangements between litigation funders and claimants are reasonable.

A balance must be struck, specialist funders risk losing their investment if the case is lost, so rewards must be attractive enough to bring them into the market. Whilst their financial muscle is often the only way to take deep-pocketed businesses to court and obtain justice.

That is why the Lord Chancellor’s recent commitment to reverse the damaging impact of last year’s PACCAR Supreme Court judgment, as quickly as possible, is a welcome relief.

In its July 2023 ruling the court decreed that litigation funding agreements were unenforceable in competition cases – a blow to those without the finances to seek restitution.

Before the Lord Chancellor’s intervention, the clear implication of PACCAR was that a similar group to the postmasters would be prevented from overcoming a future miscarriage of justice.

While a recent amendment to the Digital Markets, Competition, and Consumers Bill -which allows the use of damages-based agreements in opt-out collective proceedings before the Competition Appeal Tribunal – has been a great start, we need greater focus on the ability for everyone to pursue their rights.

Last week the Appeal Court upheld the High Court’s decision to allow a claim in the case of Commission Recovery Limited v. Marks & Clerk LLP and Long Acre Renewals to go ahead, providing more clarity.

Yet more evidence that the government must consider measures to put all forms of collective redress actions on a firmer legislative footing.


For the full article written by Martyn Day, co-president of CORLA and co-founder of Leigh Day, and published by The Times on 25 January 2024, click here.

Published on January 25, 2024 by CORLA

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