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The Plaice to be!

Next week, QLP will be venturing down to Old Billingsgate (the site of the once famous fish market) to discuss all things funding and insurance at the NetLaw conference (come in and see us)

From one Market to another, you could say, as recent times have seen the emergence of the third party funding (TPF) market as a widely acknowledged method of financing cases. In fact, with an estimated £1 billion of funding available, the market is beginning to resemble Billingsgate in its prime; booming – though thankfully without the smell!

As Lord Jackson explained in his (infamous) review of civil litigation, the benefits of third party funding can be enormous. It provides an additional means of funding litigation and for some parties, the only means. It therefore promotes access to justice, helping claimants to overcome the cost and risk associated with litigation.

For many, the David and Goliath scenario will immediately spring to mind, however the role of third party funding is in fact much wider. Indeed, as the Association for Litigation Funders (ALF) notes: “the growth of litigation funding is to be encouraged as a means of ensuring access to justice by allowing corporations and others with meritorious claims to conduct litigation in a way that does not put undue strain on balance sheets.

In the Post-Jackson era, the TPF market has also seen the development of the rules and regulations required by any market to ensure it remains attractive and efficient. An ALF code of conduct ensures the self-regulation of the market around three core concepts: Funders must ensure that they maintain adequate financial resources to meet their obligations, sourced from investors including listed companies, hedge funds and private equity entities. Secondly, funders must behave reasonably and only withdraw from agreements in specified circumstances, and finally, funders are prohibited from taking control of litigation or settlement negotiations.

In addition, funds are also provided on a non-recourse basis. In short, this means it is an investment in your client’s litigation. Should the case be lost, the funder loses their investment and nothing is owed by the litigant. If the case is won, their reward is either a predetermined percentage of the damages or a multiple of the funds advanced.

Despite this, and the clear benefits for both lawyers and clients alike, third party funding remains an underutilised market (there is plenty of fish left in the sea, if you will)

QLP can help you and your clients to take advantage of this, broking access to funds which in conjunction with ATE insurance, mitigate the financial costs, risks and disruption of any commercial litigation.

Visit us online, or on LinkedIn to find out more