MoJ could exclude insolvency in latest reforms

MoJ could exclude insolvency in latest reforms

U-turn on the cards over plans to stem tide of no-win, no-fee lawyers in insolvency litigation cases

THE MINISTRY OF JUSTICE has said it might exclude insolvency proceedings in the latest reform to curb no-win, no-fee litigation cases.

Earlier this year, the government-commissioned Jackson Report was published and included plans to abolish conditional fee arrangements (CFAs), better known as no-win, no-fee deals.

Restricting these types of deals could make it more difficult for insolvency practitioners to pursue fraudulent company directors, to recover greater funds for creditors.

HMRC, as a recurring unsecured creditor, could lose millions of pounds each year from the reforms as practitioners decide against pursuing company directors through the courts.

However, a MoJ spokesman told The Guardian: “We are considering the impact of abolishing CFA recoverability in insolvency and related proceedings. These proceedings can bring substantial returns to creditors, including HMRC.

“We are therefore discussing the specific implications with a view to reaching a satisfactory conclusion.”

The reforms were brought in to reduce the numbers of what are known as ambulance-chasing lawyers in litigation cases.

Related Articles

More bad news for Debenhams

Business Recovery More bad news for Debenhams

2m Emanuela Hawker, Reporter
Insolvency and corporate governance

Business Recovery Insolvency and corporate governance

2m Chris Laughton
Impact of Brexit on restructuring and insolvency

Business Recovery Impact of Brexit on restructuring and insolvency

4m Emma Smith, Managing Editor
Toys R Us UK and Maplin enter into administration after failing to secure buyers

Business Recovery Toys R Us UK and Maplin enter into administration after failing to secure buyers

10m Alia Shoaib, Reporter
How to avoid a Carillion collapse

Business Recovery How to avoid a Carillion collapse

11m Russell-Cooke
Carillion collapse: The week so far and industry reaction

Business Recovery Carillion collapse: The week so far and industry reaction

11m Emma Smith, Managing Editor
Carillion: PwC appointed as special managers – what happens now?

Business Recovery Carillion: PwC appointed as special managers – what happens now?

11m Emma Smith, Managing Editor
Investment firm acquires Avon Steel Company Limited

Business Recovery Investment firm acquires Avon Steel Company Limited

1y Emma Smith, Managing Editor