This is likely to have a significant impact on the insolvency sector, as we may now see a real reluctance from some insolvency practitioners in pursuing claims, particularly lower value ones.
This could play into the hands of the litigation funders, especially with the changes being introduced by SBEEA in relation the ability for insolvency practitioners to assign officeholder claims as well as Company claims.
Contentious insolvency lawyers could soon find themselves doing more and more work for litigation funders and less for insolvency practitioners.
The government has today announced that the insolvency exception to the Jackson reforms will come to an end in April next year. This means that CFA success fees and ATE insurance premiums will no longer be recoverable in proceedings brought by liquidators, administrators, trustees in bankruptcy, and companies in liquidation or administration. The change will bring insolvency proceedings into line with other types of claim, where recoverability was abolished from April 2013.