Legal Aid, Sentencing and Punishment of Offenders Bill

My Lords, I return to a subject which we addressed in Committee: proceedings brought by a liquidator of a company, the trustee of a bankrupt's estate or an administrator appointed pursuant to the provisions of Part II of the Insolvency Act 1986 to recover the assets of a business or company which has gone into liquidation or has become financially insolvent. The point is that insolvency practitioners who engage in that important work have to bring proceedings to recover the assets of the company, or money representing the assets of a company, from a company director or partner in the firm. They can be very expensive proceedings, because a lot of investigation has to be undertaken. Often, the director or partner who is in default has disappeared—or hopped it overseas—so it is not easy to bring those proceedings. The liquidators, and so on, cannot bring the proceedings themselves. They employ solicitors to do that and to carry out those investigations. From time to time, they are forced to go to court to try to get a court order against an individual. In so doing, a conditional fee agreement is entered into, and a success fee is part of that conditional fee agreement. As all of us will know, one of the major creditors is Her Majesty's Revenue and Customs. Consequently, it seems a little silly to employ insolvency practitioners to recover all this money and then to have a reduction, contrary to the interests of the Revenue and Customs, from whatever has been recovered in order to pay the success fee. It seems to me that the success fee, when these proceedings are successful, should be paid by the person who is in default—the person who has hopped it. That is the current situation. I mentioned earlier today that back in 1990 when the noble and learned Lord, Lord Mackay, introduced conditional fee agreements for the first time, there were three categories: personal injuries, insolvency proceedings and applications to the European Court of Human Rights. So from the very beginning, from the inception of this type of agreement, insolvency practitioners have had this protection for the proceedings that they have to bring. From the point of view of making sure that the defaulter pays and in the interests of the Revenue and Customs and perfectly decent creditors which may be a large firm or a small firm, it seems only sensible that the amendment should succeed. I beg to move.