The European Law Institute (ELI) project on Third Party Funding of Litigation recently concluded with the publication of Principles Governing the Third Party Funding of Litigation. Written in recognition of the rapid expansion of third party funding agreements, these Principles are relevant to litigants, funders, legal advisors, regulatory bodies and any dispute resolution body determining issues on third party funding. They are also essential reading for anyone considering the Civil Justice Counsel’s review of litigation funding in the UK.

Risk and Funding partner Julian Chamberlayne was invited to speak at ELI’s first official webinar addressing the publication, to give the perspective of the legal industry. The participants debated the necessary compromise between improved access to justice, and the requirement for funding agreements to be fair for all participants.

The other speakers included:

• Pascal Pichonnaz (ELI President; Professor, University of Fribourg)
• Susanne Augenhofer (Co-Reporter; Professor, Universität Innsbruck; Visiting Professor and Senior Research Scholar in Law, Yale Law School)
• Pia Lindholm (Deputy Head of Unit for Civil Justice, Directorate-General for Justice and Consumers, European Commission)
• Elizabeth Bragina (Senior Legal Officer, The European Consumer Organisation (BEUC))
• Danguolė Bublienė (President of the Supreme Court of Lithuania)
• Dame Sara Cockerill (Co-Reporter; Judge of the High Court of England and Wales, Judge in Charge of the Commercial Court 2020–2022)

What essential principles are needed to govern third-party litigation funding?

Julian’s starting point was that “the ELI Principles provide a powerful blueprint for guidance, advice and decisions on third party funding. They helpfully assume and allow for flexibility between different jurisdictions and practice areas rather than seeking to impose a one- size fits-all approach.” Proposing that the Principles could work effectively to address a ‘skills gap’ among European lawyers to equip them to advise their clients on  funding agreements, he also concurred that funded parties should retain control over litigation as proposed by the ELI.

Julian also addressed potential issues raised by the draft commentary to the Principles on who can provide ‘independent legal advice’ to prospective funded parties. These issues will be  addressed more fully in his article for the next issue of Litigation Funding magazine.

Watch the video in full below.

Third-party funding has a long tradition in jurisdictions including England and Wales, and has been consistently touted as a key tool in ensuring access to justice in particular for potential claimants without the means to bring claims independently. As lawmakers across the world grapple with how to regulate the growing industry, the ELI has issued what is intended to be a “blueprint for guidance, decisions or light-touch regulation”. In particular it highlights that too heavy-handed an approach “may well lead to funders ceasing to offer funding in the regulated territory – with consequent impact on access to justice issues”.

The second in this series of webinars takes place on 11 November – register here