Sensible steps on litigation funding

Litigation funding is definitely a growth area and represents a very sensible option in many cases. The one potential drawback at the moment is that the funding is generally only available for bigger cases, and this represents a fairly small section of the commercial litigation market.

Having said this it appears, according to the Civil Justice Council, that consensus has been reached on a set of rules which the major funders are likely to voluntarily adopt, which will address many of the concerns about litigation funding. The main points which will apparently be in the code of conduct are :-

• For membership the members will have to prove solvency and adequate funding for cases.
• Model litigation funding agreements will contain a type of arbitration clause where if the funder and fundee disagree on settlement or termination of litigation a senior lawyer will determine the issue.
• an Association of Litigation Funders will be set up to give further credibility to the funders who are members and top the litigation funding concept generally.
• Brokers for funding will be eligible to also join the new Association as associate members.

We are fans of litigation funding generally, what do you think and do you think litigation funding can be utilized in the smaller value commercial litigation cases or in other categories. Most of the current funders will only look at cases with a value of over £250,000.00.