UK Litigation Funding – A New Approach?

The growth and evolution of third party funding or "litigation funding" has been one of the most significant developments in the litigation market over the last 10 years or so. Typically, litigation funders provide funding on a case-by-case basis, however there now appears to be a growing shift by funders and corporates who are seeking to structure their funding arrangements on a portfolio basis.

What is litigation funding?

Litigation funding is where a third party (unconnected to the legal proceedings) agrees to finance all or part of the legal costs of a claim. In return for the funding, the "funder" will (if the claim is successful) typically receive either a share of any monies recovered from the litigation or their contribution to the legal fees will be returned with an agreed uplift. If the claim is unsuccessful however, the initial investment is lost and the funder may be liable to pay any adverse costs awarded against the funded party, capped at the amount