Litigation Funding Agreements (Enforceability) Bill [HL]

Lord Carlile of Berriew Excerpts

2nd reading
Monday 15th April 2024 Lords Chamber

[Lord Carlile of Berriew (CB)]

My Lords, it is a tremendous privilege to follow the noble Lord, Lord Arbuthnot. He has shown, in his conduct in connection with the Horizon case, the courage, rigour and persistence that we all should aspire to and yet do not always achieve.

Like the noble Lord, I welcome this Bill. I have fond memories as a baby barrister of taking over preparing small cases that the noble Lord, Lord Thomas of Gresford, as he now is, was far too successful to deal with by then. I used to sit in the spare bedroom at home, very early in the morning, drafting pleadings in personal injury cases. Some of them were for the defendants—the employers or their insurers—but not a small number of them were for individuals who could get legal aid to bring those cases before the county court, where I often appeared to present them if the wicked insurers did not pay up. At the end of every quarter, as I am sure the noble Lord will remember, we used to receive a payment for our civil legal aid work, from which 10% was deducted because it was legal aid. Justice was obtained by very large numbers of people through that legal process, which obviously involved solicitors instructing us as well. It was another era, and I suspect we were far too successful in the work we did for claimants and legal aid became too expensive—but there we are. We have been left with the loss of legal aid for the bulk of such cases. Litigation funding is what has replaced it and it is here to stay. I was astonished by the PACCAR ruling, because it removed the enforceability at a stroke. I do not understand how it happened—and I have read the PACCAR judgment in the Supreme Court on several occasions. There we were, with those who were funding a lot of small cases not able to recover any costs when they won.

I also recall, much later in my life as a barrister, being what one might call a jobbing, part-time chairman of the Competition Appeal Tribunal under the rigorous but agreeable presidency of the noble and learned Lord, Lord Bellamy, when the CAT, on which I sat for 10 years, started to receive cases for bulk claimants. I now declare an interest, having been involved as an adviser in two such groups of cases that went before the Competition Appeal Tribunal. One group involved people who really could not afford to bring their own cases, but, taken together, the whole claim amounted to hundreds of millions of pounds. It is right that, where justice is on the side of such claimants, they should be able to bring their claims. Above all those commercial interests, it is right that people such as postmasters and postmistresses can recover damages.

There was a time in my life as a barrister when I used to do prosecutions for the Post Office on the Wales and Chester circuit, as it was then known. I do not know if I prosecuted any Horizon cases—I think not, because I took Silk a very long time ago and did not do it after that—but there was no doubt that, when instructions were presented to me as a prosecutor and when cases were presented to a court, there was a view that on financial matters the Post Office was infallible. It had a status which had an air of infallibility around it, and that has been proved to be horribly wrong. It is absolutely right that we should be supporting, in the right circumstances, those who will allow such cases to come to court. I very strongly support the principle behind the Bill and its very short provisions.

I want to express two lurking concerns, if I may, both of which have been dealt with in this debate already, so I will be brief. The first is that lawyers are regulated by statute but litigation funders are not. There is an organisation called the Association of Litigation Funders, but I have noticed that its 2018 code of practice has barely been mentioned in any publicity about this matter. My view is to welcome the CJC inquiry very strongly and that we should be prepared, if absolutely necessary, to provide statutory legislation for litigation funders—though I suspect from what I have seen that they will be willing to move voluntarily to a proper level of regulation, which is in some ways much better than statutory legislation because it is much more flexible.

Another point that has come to light came to my attention this morning, when I received a very large amount of information from an interested party, who I think instructed the noble Lord, Lord Macdonald—who has been mentioned and for whom I have immense regard—as legal counsel to provide an opinion on whether the Bill falls within the European Convention on Human Rights. The Minister has certified that it does and that it is in the Bill, which would not be here if it did not—except in the one case that we will be discussing tomorrow. I simply ask the Minister, at the appropriate time, which may not be this afternoon, whether he has had more than the three or four hours that I have had to consider what was presented to me by another person as very opportunistic lobbying, including the opinion of the noble Lord, Lord Macdonald, and whether he will advise the House on whether there are any ECHR problems.

I note that, at the end of his opinion, the noble Lord, Lord Macdonald, described the case against the ECHR as “arguable”. That was the word that he used, I suspect with great care. We have all used it from time to time in our legal lives, and it does not express the highest level of conviction. I am sure that the House would like to be sure that we are not, by accident, falling foul of the European convention, to which, in most respects at least—I cannot help saying this—the Government are devoted.

Litigation Funding Agreements (Enforceability) Bill [HL]

Lord Carlile of Berriew Excerpts

Committee stage
Monday 29th April 2024 Grand Committee

I am sorry to have gone over my time, but I hope that may have been helpful.

[Lord Carlile of Berriew (CB)]

My Lords, I will say a very few words that may help the debate. I wholly support the government amendments spoken to by the noble and learned Lord; they clarify the Bill in a way that was required.

I will just go back to something the noble and learned Lord said about what I had said at Second Reading about the Human Rights Act consequences. I referred to the opinion that had been given to us—again, very late in the day, like most representations in this matter—written by my noble friend Lord Macdonald of River Glaven. I am sure we all understand why he is not taking part in these debates; he feels that professionally he cannot because he gave an opinion, a view that I think all practitioners here would support. He said in that opinion that the convention rights arguments with which he was presented in his instructions were “arguable”—that was his word. That is not the highest level of certainty that those of us who have written a lot of opinions would ever put at the end of an opinion if we felt sure. They may be arguable, but they are not strong, and the Government are perfectly entitled to act as they are in that regard.

Then there is the question of retrospectivity. The answer to that is very simple. The Bill would be absolutely pointless if it were not retrospective, because it was created to right a wrong that nobody expected, and it is simply restoring to people the legal rights which they already had. I hope that we will not spend an awful lot of time in other stages of the Bill talking about retrospectivity.

I note that the Civil Justice Council’s new review—I agree with what the noble Lord, Lord Marks, said about its terms of reference—has had support from the Bar Council and the Bingham Centre, in a very well-argued piece that I think was circulated to most Members of the Committee. It was also supported by what we might call the interest groups: the Association of Litigation Funders and the International Legal Finance Association, which have taken a pretty objective view of the proposals in this Bill. All are of the view that the Civil Justice Council, as it is set up by the terms of reference, is the appropriate place for the review to take place. Of course, it leaves some flexibility and some obligation, because a rule-making body such as the Civil Justice Council can change the law in small ways to ensure that appropriate procedures are followed.

For reasons which some noble Lords will recognise, I am an enthusiast of independent reviewers—because I have been one—but I am not an enthusiast for an independent reviewer in this situation. Although an independent review would undoubtedly be fascinating, it would have no power whatever. We need to get nearer to the rule-making powers to ensure that the law in this area is clear, followed, applied by the judges and, above all, understood clearly by the courts.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I rise very briefly, acutely aware of the legal weight in the Room, to which I add not a gram—although I cannot help noticing the gender balance. I apologise for not speaking at Second Reading. My noble friend Lady Jones of Moulsecoomb spoke in the Second Reading debate but she is currently taking part on the Leasehold and Freehold Reform Bill in the Chamber. I listened very carefully to the words of the noble Lord, Lord Marks of Henley-on-Thames, who is satisfied with the review process that we have going forward, and I will be guided by that.

I want to stress that where we are going now is still not an adequate solution to the problems at hand. At Second Reading, my noble friend said that we need to put

“energy into thinking about a better solution”.—[Official Report, 15/4/24; col. 810.]

We have to do that in the context where we have a crucial, huge inequality of arms—Horizon is the obvious example—in an economy dominated by an increasingly small number of oligarchic, giant, often multinational companies that are deciding how things work in our economy and society, of which people are very often the victims. We have a structural problem: the law now is not equipped to deal with the structure of our economy and society. I conclude only by noting that justice unfunded is justice denied, and there is far too much justice denied to individuals in our society when they are crushed by the weight of corporations or the state.