Third-Party Funding Under The New Arbitration And Mediation Act 2023

INTRODUCTION

Individuals and businesses find themselves involved in legal disputes that demands substantial financial resources to cover legal fees, court expenses and other related expenses. Consequently, securing financial support to initiate and sustain legal proceedings till resolution is not just an option but a necessity. Third-party funding (TPF) – a practice where an external financier steps in to provide financial assistance to either party to a dispute in exchange for share of the potential judgment or settlement sum, has therefore gained popularity as a means of financing legal claims. This can be crucial for ensuring access to justice, particularly in cases where financial resources might otherwise be a barrier.¹Historically, the practice of third-party funding was considered contrary to public policy and therefore deemed illegal. The principle of maintenance and champerty², historically rooted in English common law, refers to the unethical and often