The implementation of Lord Justice Jackson's reforms of "no win, no fee" conditional fee arrangements (CFAs) has been pushed back for six months until April 2013.
The Ministry of Justice announced the delay Monday, with the decision taken to allow law firms and legal businesses more time to prepare themselves for the implications of the changes.
The civil litigation reforms, contained within the second part of the Legal Aid, Sentencing and Punishment of Offenders Bill, had been scheduled to come into force from October 2012.
The government has already announced that it is to delay part one of the bill, which deals with legal aid reform.
The civil litigation reforms -- which include the abolition of the recoverability of success fees and associated costs in "no win, no fee" CFAs, with claimants to pay their lawyers' success fees instead -- were confirmed in June last year.
The bill is largely an implementation of Lord Justice Jackson's recommendations for civil litigation costs reform published in 2010.
However, Jackson openly criticized the controversial government cuts to legal aid last year in a speech to the Cambridge Law Faculty, warning the reforms were "contrary to [my] recommendations."
A Ministry of Justice spokesperson said: "We are committed to reforming the 'no win no fee' system so that legal costs for reasonable compensation claims will be more proportionate, and avoidable claims will be deterred from going to court. This will help us to move away from the current unacceptable situation where, for example, the NHS paid £200m to claimants' lawyers for compensation cases in 2010-11 -- around three times more than it paid its own lawyers.
"This will require changes to legal rules and regulations and we want to give sufficient time to get the complex details right. We are also conscious that legal businesses will need sufficient time to plan for the changes, alongside other forthcoming regulatory and funding changes to the industry. We will therefore implement the new measures, subject to Parliamentary approval, in April 2013."