Litigation funding is here to stay after the Civil Justice Council concluded that regulations governing litigation funding must remain as they are "in the interest of justice".
The advisory public body, which oversees the modernisation of the civil justice system, held that third-party litigation funding has a major role to play in facilitating access to justice.
The council, which made its decision at a recent cost committee forum, ruled that the existing regulatory framework set by the Financial Services Authority and the Solicitors' Regulation Authority are already adequate.
The Commercial Litigation Association (Clan) has welcomed the decision, claiming that any further regulations would be "unnecessary and a constraint" on "an already appropriately regulated market".
Clan chairman Tony Guise said: "The dangers in pursuing a heavily regulatory route are shown by the problems that have beset the funding of personal injury cases for so long, with interminable disputes over fixed recoverable fees. It's important that such mistakes are not made again."
The clarification of the council's feelings concerning litigation funding comes after the issue hit the headlines at the beginning of this year. As revealed on www.thelawyer. com (5 January), Norton Rose secured the largest, publicly known independent funding for dissolved company Stone & Rolls from specialist provider Insolvency Management in a $173.6m (£87.82m) negligence claim against City-based accountancy firm Moore Stephens.