Coroners and Justice Bill — Report (4th Day) — 29 Oct 2009 at 13:07

Amendment 96

Moved by Lord Bach

96: After Clause 143, insert the following new Clause-

"Damages-based agreements

(1) The Courts and Legal Services Act 1990 (c. 41) is amended as follows.

(2) After section 58A insert-

"58AA Damages-based agreements

(1) A damages-based agreement which satisfies the conditions in subsection (3) is not unenforceable by reason only of its being a damages-based agreement; but any other damages-based agreement is unenforceable.

(2) For the purposes of this section, a "damages-based agreement" is an agreement between a person providing advocacy services, litigation services or claims management services and the recipient of those services which provides that-

(a) the recipient is to make a payment to the person providing the services if the recipient obtains a specified financial benefit in connection with the matter in relation to which the services are provided, and

(b) the amount of that payment is to be determined by reference to the amount of the financial benefit obtained.

(3) The agreement-

(a) must relate to proceedings or a claim of a prescribed description;

(b) must not relate to proceedings in a relevant court;

(c) must not provide for a payment above a prescribed amount or for a payment above an amount calculated in a prescribed manner;

(d) must comply with such other requirements as to its terms and conditions as are prescribed;

(e) must be made only after the person providing services under the agreement has provided prescribed information; and

(f) must be in writing.

(4) A description of proceedings prescribed under subsection (3)(a) must not include proceedings that are-

(a) criminal proceedings; or

(b) family proceedings (within the meaning given by section 58A(2)).

(5) For the purposes of subsection (3)(b) an agreement is not to be treated as relating to proceedings in a relevant court if the services to be provided under the agreement are services that are to be provided only in contemplation of such proceedings before they are commenced.

(6) Regulations under subsection (3) are to be made by the Lord Chancellor and may make different provision in relation to different descriptions of damages-based agreements.

(7) Before making regulations under subsection (3) the Lord Chancellor must consult-

(a) the designated judges,

(b) the General Council of the Bar,

(c) the Law Society, and

(d) such other bodies as the Lord Chancellor considers appropriate.

(8) In this section-

"claim" and "claims management services" have the same meaning as in Part 2 of the Compensation Act 2006 (see section 4(2) of that Act);

"payment" includes a transfer of assets and any other transfer of money's worth (and the reference in subsection (3)(d) to a payment above a prescribed amount, or above an amount calculated in a prescribed manner, is to be construed accordingly);

"proceedings" includes any sort of proceedings for resolving disputes (and not just proceedings in a court), whether commenced or contemplated;

"relevant court" means-

(a) a magistrates' court;

(b) a county court;

(c) the High Court;

(d) the Court of Appeal;

(e) the Supreme Court.

(9) In this section references to "advocacy services" or "litigation services" include a reference to services that it would be reasonable to expect a person who is acting (or contemplating acting) for another in relation to proceedings that do not take place in a court, to provide.

(10) Nothing in this section applies to an agreement entered into before the coming into force of the first regulations made under subsection (3)."

(3) In section 120(4) (regulations and orders) after "58(4)," insert "58AA"."

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