Litigation funding

Have you ever felt you have a strong claim, but no clear way to fund it? For many individuals and businesses involved in civil litigation or commercial disputes, cost can be a significant barrier.

You are not alone. Many people and businesses step back from good claims simply because the financial burden feels too high. That reaction is common, and it is understandable.

What is litigation funding?

Litigation funding allows a third party to pay some or all of the costs of a legal claim. That includes legal fees and the expenses that come with running a case.

In most arrangements, the funding is provided on a “no recovery, no return” basis. This means the funder carries the financial risk. If the claim does not succeed, the funded party usually does not need to repay the funding.

Funding often also protects against adverse costs. That can remove the risk of having to pay the other side’s legal costs if the claim does not succeed.

In return, the funder is paid if the claim succeeds. That payment usually takes the form of either a multiple of the costs they have funded, or a share of the proceeds recovered from the claim.

The result is a shift in risk. Claims can be pursued on their merits rather than being limited by a claimant’s ability to fund a civil dispute or court proceeding.

Who uses litigation funding?

Litigation funding is often associated with people who cannot afford to bring a claim at all. That remains an important use. It can open a path to justice that would not otherwise exist.

But that is only part of the picture. Businesses and individuals also use funding where they could pay, but prefer to preserve cashflow while pursuing commercial litigation or other recovery actions.

It is a way of managing risk. Even strong claims carry uncertainty, and funding can reduce the financial exposure that comes with taking that step.

Is litigation funding right for your claim?

Funding is not available for every case. Funders usually look for claims with a strong likelihood of success, clear evidence and a realistic recovery outcome at the end of the litigation process.

They will carry out their own assessment before agreeing to fund a claim. As part of that, they may require information about the case and its prospects.

A funder may also have some input into how the case is run. That can include oversight of key decisions, although the claim remains in the hands of the client and their legal team.

The key is structure. A well-prepared claim, with clear evidence and a defined outcome, is far more likely to attract funding and proceed smoothly.

Talk to us

Litigation funding can change what is possible. It can remove barriers, manage risk, and allow claims to proceed that might otherwise sit unresolved.

Holland Beckett’s civil litigation and dispute resolution team has experience working with litigation funders and structuring funded claims across a range of disputes

If you would like to explore your options, contact us for a confidential discussion.

Learn more about funding options for different disputes:

• Challenging a Will – Family Protection Act Claims and Litigation Funding
• Construction Payment Claims – and cost options
• Directors’ Duties and Insolvency Recovery Claims
• Leaky Homes and Defective Building Claims