The delay of the introduction of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LAPSO) indicates that the government is simply looking after its own interests, it has been suggested.
The no-win, no-fee regime will not “for the time being” be applied to insolvency proceedings, Shailesh Vara, Parliamentary Under-Secretary of State for the Ministry of Justice with responsibility for the Courts and Legal Aid, has announced.
It was explained that the delay of LAPSO application has been given in order for insolvency practitioners to have extra time to prepare and adapt to the removal of no-win, no-fee arrangements.
John Hyde, deputy news editor at the Law Gazette, has given his thoughts on the development in an opinion piece for the publication.
“This is an act that came into force in April 2013. The Jackson report on civil litigation was published in 2010. If insolvency practitioners aren’t ready for the change by now, they never will be,” he commented.
Mr Hyde goes on to suggest that “money has talked” in this moment of indecision.
The government itself, in the form of HMRC, would be the most affected unsecured creditor, he suggests.
“The MoJ would, in effect, be cutting off the Treasury’s nose to spite its face.”
The government, he continues, feels it necessary to protect creditors from LAPSO, but not people suffering catastrophic injuries.
“The exemption will be widely welcomed by most in the insolvency sector, but it leaves a bitter aftertaste. It is literally one rule for creditors owed money and another for the rest.”
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