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Legal deals which helped sub-postmasters overturn Horizon scandal convictions to be protected

Tom Hedges outside the Royal Courts of Justice in London on April 23, 2021
Sub-postmaster Tom Hedges outside the Royal Courts of Justice after his 2010 conviction was overturned on April 23, 2021 - Tolga Akmen/AFP via Getty Images

No-win, no-fee legal deals that enabled sub-postmasters to take action against the Post Office are to be protected by a new law after the Supreme Court ruled that they were unenforceable.

Alex Chalk, the Justice Secretary, is to introduce a law that will return the legal situation to what it was before the Supreme Court issued its ruling.

The Supreme Court judges ruled that so-called third party agreements were unenforceable. These are legal deals where lawyers take on a case often for no or minimal funding on the basis that they will take a percentage of the damages even though they are not party to the dispute.

Mr Chalk said the new law would make it easier for members of the public, such as the sub-postmasters, to secure the financial backing of third parties when launching complex claims against moneyed corporations with sizeable legal teams which they could otherwise ill-afford.

“It’s crucial victims can access justice – but it can feel like a David and Goliath battle when they’re facing powerful corporations with deep pockets, Mr Chalk said.

“This important change will mean more victims can secure vital third-party funding to level the playing field and support their fight for justice.

“The sub-postmasters were able to secure third-party funding in their legal action against the Post Office. Now others will too.”

Lord Chancellor and Secretary of State for Justice Alex Chalk
Mr Chalk: 'It's crucial victims can access justice' - Anadolu

Therium Capital Management, a specialist litigation funder, backed the ‎compensation claim by 500 sub-postmasters against the Post Office after they were falsely accused of fraud because of its flawed Horizon IT system.

It was only because of Therium that the sub-postmasters were able to sue. Alan Bates, the sub-postmaster who led the campaign, has called for a change in the law to ensure similar David versus Goliath battles can go ahead.

Nick Emmerson, the Law Society president, welcomed the move. “Too frequently it is said that justice is not a priority for this Government, but we would hope recent events will call for reflection on how it supports access to justice through the court system for all those without independent financial means,” he said.

“The public do care about justice and are vocal when it is lacking.”

The Government is also considering options for a wider review of the sector and how third-party litigation funding is carried out.

This could consider whether there is a need for increased regulation or safeguards for people bringing claims to court, particularly given the growth of the litigation funding sector over the past decade.