UK law firms prepare for Mazur Court of Appeal hearing as case threatens to reopen settled questions on professional liability and litigation funding
The Court of Appeal is set to hear the Mazur appeal next week, with law firms across the City closely monitoring proceedings. The case centres on questions of professional liability and has implications for how litigation funding agreements interact with solicitor obligations — an area where appellate guidance has been fragmented and long-awaited. The Mazur appeal has attracted significant industry attention because it sits at the intersection of two pressure points for commercial law firms: the scope of solicitor liability to third parties and the treatment of after-the-event (ATE) insurance and litigation funding arrangements in the context of adverse cost orders. If the Court of Appeal widens the circumstances in which solicitors can be held liable beyond their direct client, or clarifies the priority of funded litigation costs, the decision will reshape the risk calculus for both law firms running funded cases and the funders themselves. The case arrives at a sensitive moment for the UK litigation funding sector. The Supreme Court's PACCAR judgment in 2023 — which held that litigation funding agreements could constitute damages-based agreements (DBAs) regulated under the Courts and Legal Services Act 1990, potentially rendering many existing funding arrangements unenforceable — triggered legislative responses and market restructuring. The Mazur appeal is understood to engage related questions about solicitor duties in the context of funded multi-party litigation. The outcome will be carefully studied by disputes practices advising both funders and the funded.
Why this matters
Any Court of Appeal decision clarifying solicitor liability in the context of funded litigation lands at a moment when the market is still recalibrating from PACCAR and its aftermath. Disputes practices at large firms have a direct commercial interest in this outcome: clearer appellate guidance reduces the risk that funding arrangements are challenged mid-litigation, which has been a destabilising tactic in several high-value commercial cases. Litigation funders — including Burford Capital, Harbour, and others active in the London market — will also be tracking the judgment's implications for their portfolio risk assessments. The 'why now' trigger is the post-PACCAR uncertainty: the market restructured its documentation practices, but gaps remain, and the Mazur appeal may fill some of them. Firms with large commercial litigation and disputes practices, particularly those running funded group actions, face the most direct exposure.
On the Ground
A trainee working on a matter related to this appeal would be preparing a chronology of key procedural steps and relevant prior judgments for the skeleton argument team, and assisting with disclosure review and categorisation of documents relating to the funding arrangement structure under scrutiny.
Interview prep
Soundbite
Mazur could settle the remaining PACCAR-era uncertainty on solicitor liability in funded cases — the market is watching because the answer reshapes funder risk pricing.
Question you might get
“How did the Supreme Court's PACCAR decision affect litigation funding agreements in England and Wales, and what legislative or market responses followed?”
Full answer
The Court of Appeal is hearing the Mazur appeal next week, a case that law firms are watching closely because it engages solicitor liability in the context of litigation funding arrangements — an area left uncertain by the Supreme Court's PACCAR decision in 2023. PACCAR held that many litigation funding agreements might constitute DBAs under the Courts and Legal Services Act, potentially making them unenforceable as drafted; the market responded with documentation rewrites but legal uncertainty persists. Mazur, which raises related questions about the scope of solicitor duties to third parties in funded matters, may either resolve or deepen that uncertainty. For law firms, the practical stakes are high: widened liability exposure or clearer funding enforceability rules directly affect how disputes teams structure and price funded case mandates. This is one of the most commercially significant pending UK appellate decisions for the litigation sector in 2026.
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