United Kingdom

On behalf of the team


On 5 March 2021, the UK Court of Appeal ruled that DAF will not be allowed to challenge a ruling from the Competition Appeal Tribunal (“CAT”) on a case in which DAF disputed the validity of the litigation funding arrangements of two mass follow-on damages claims based on the truck cartel decision and argued that the claims should therefore be denied. In general terms, the issue at hand was whether a litigation funding agreement entered into with claimants by third parties who play no part in the conduct of the proceedings, but whose compensation is fixed as a share of the damages recovered by the client – which party is normally the funder – are “damages-based agreements” (“DBAs”) within the meaning of the relevant legislation which regulates such agreements (Section 58AA of CLSA 1990). If such agreements are considered DBAs, the likely consequence is that they will be unenforceable, unless the agreements comply with particular conditions set out in Section 58AA. The CAT did not concur with DAF on this, and now the Court of Appeal has ruled, after careful consideration of the relevant legislation and case law, that the CAT did not err in law in its interpretation of the relevant provisions. DAF’s application for judicial review on the merits was therefore rejected.[1]

[1] Court of Appeal, appeal against the Competition Appeal Tribunal’s ruling, 5 March 2021, [2021] EWCA Civ 200.