The Court of Appeal has today handed down its judgment in
ChapelGate Credit Opportunity Master Fund Ltd -v- Money &
others. The Court of Appeal has upheld the decision of the High
Court not to limit a commercial funder's liability for payment
of the costs of the successful BDO administrators to the extent of
the funding provided. The judgment provides welcome clarity on the
status and application of the so-called "Arkin cap", and
is of significant interest to commercial funders of litigation and
to any professional services firm defending a claim which is, at
least in part, backed by a commercial funder.
Our view is that the decision helpfully clarifies that the Arkin
cap is only guidance and not a rigid rule. Whilst the
Court of Appeal has said that the cap might still be appropriate on
the facts of some cases, it is nevertheless clear that the Court
considered that the litigation funding market had moved on from the
early days when Arkin itself was decided, such
