Speaking to Lawyers Weekly, Burford Capital CEO Chris Bogart said Aussie lawyers’ appetite for litigation funding has grown substantially, with more seeing it as a necessity in the business of law.
“Every year Burford commissions a ‘Litigation Finance Survey’ which closely monitors global industry trends. The survey, which involves 495 lawyers in Australia, Britain and the United States, found that 83 per cent of Australian respondents expected litigation funding to be increasingly important in the business of law, compared to 73 per cent in the US and 78 per cent in Britain," Mr Bogart said.
“Among those lawyers whose organisations have not used litigation funding, 72 per cent of Australians were likely or very likely to make use of it in the next two years.
“Clearly this shows an appetite in the Australian legal market for increased use of litigation finance and an increased appreciation for its potential benefits.
“Although litigation finance is already widely used to fund class actions in Australia, I would expect to see more and more diversity in the kinds of matters which we are funding, for example an increased uptake in commercial litigation finance on a single-case and portfolio basis.”
Mr Bogart also offered some insight into the Australian Law Reform Commission’s (ALRC) Inquiry into Class Action Proceedings and Third-Party Litigation Funders.
“As the world’s largest provider of third-party litigation finance Burford Capital welcomes the ALRC’s June 2018 Discussion Paper which aims to clarify the position for litigation funders particularly in reference to the role that funders play in the class action landscape,” he said.
“Litigation finance as it exists today in Australia focuses substantially on class actions and it has flourished in that segment of the legal market because Australia permits class actions but does not permit contingency fees.
“However, class actions count for less than 1 per cent of Australian civil litigation and we encourage the ALRC to bear in mind the full potential scope of litigation finance activity. Especially, as I have already noted, that there appears to be a burgeoning client demand for litigation finance of non-class action commercial litigation.
“The business of financing non-class civil litigation does not in itself call out for regulation and we are heartened by the suggestions in the discussion paper that without the overlay of class action considerations, there would be little or no case for intervention. No common law country has seen fit to engage in any significant regulatory activity around single-party commercial litigation finance and we encourage the ALRC not to over-regulate here and that professional litigation funders should not be penalised with regulations that are more onerous than other providers of comparable services.
“In general, we acknowledge that the ALRC has already recognised the need to give credit to funders who have met comparable standards overseas to those here proposed and we endorse that view.”