Court of Appeal rules Litigation Funding Agreements are not subject to regulation as Damage-Based Agreements


Re: Paccar Inc. v RHA and UKTC [2021] EWCA Civ 299.

The case concerned the question of whether litigation funding agreements were to be classified as ‘damages-based agreements’ falling within the terms of section 58AA(3) of the Courts and Legal Services Act 1990 and were therefore unenforceable unless they conformed with Damages-Based Agreements Regulations 2013 (and were altogether unenforceable in competition law ‘opt out’ damages claims, an increasingly important form of redress for victims of anti-competitive conduct).

Held: The Court of Appeal unanimously upheld the ruling of the Competition Appeal Tribunal, finding that there was no jurisdiction to entertain an appeal from the Tribunal on this issue and (reconstituting itself as a Divisional Court) dismissing an application for judicial review of the Tribunal’s decision.

The judgment is of great importance to the litigation funding industry, which is an important mechanism supporting access to justice, as well as for UKTC’s application for an ‘opt-out’ order allowing it to pursue its action for damages arising out of the long-lasting trucks cartel.  Both Nicholas Gibson and Rhodri Thompson QC are representing UKTC in the hearing of this application, which is listed for 19-27 April 2021.  This is one of the first and largest collective claims to be brought under a new regime introduced in 2015 by the Consumer Rights Act 2015.


Rhodri Thompson QC was involved in this case.