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Litigation Funding Reforms come into force


A radical overhaul of litigation funding comes into force on 1 April 2013, by virtue of provisions in the Legal Aid Sentencing and Punishment of Offenders Act 2012 (LASPO). The legislation gives effect to many of the proposals of Lord Justice Jackson in his report of January 2010, the purpose of which was to review the costs of civil litigation. Of particular significance to “no win no fee” funding is the fact that, where the reforms apply, it is no longer possible to recover from a losing opponent a success fee or After The Event [ATE] insurance premium. The losing opponent still has to pay the majority of the base costs. In practical terms, if a success fee and ATE premium is payable, it must be paid by the client- normally out of their damages. This has given rise to concern about access to justice in media cases ( including defamation and privacy) as damages in those cases are relatively low. The reforms have therefore been deferred for the time being in media cases. Carter-Ruck partner Alasdair Pepper is a member of the working group of the Civil Justice Council which is tasked to examine the need and possible mechanisms for providing costs protection for litigants in privacy and publication cases.

Carter-Ruck has long been a pioneer of Conditional Fee Agreements (CFAs) and we can now also offer in appropriate cases Damages Based Agreements (“DBAs”), in which the fee is calculated an agreed percentage of the damages if the case is won. Carter-Ruck is one of the very few firms in England and Wales still able to offer no win no fee funding with ATE insurance.

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