How to Finance Litigation

Taking a case to court can be expensive, and many people or businesses worry about how to cover the costs. Litigation funding provides a way to pursue legal action without bearing all the financial risk.

What Is Litigation Funding?

Litigation funding is when a third-party funder agrees to pay the costs of bringing a legal claim in exchange for a share of any compensation or settlement. In most cases, this funding is non-recourse, meaning that if the case is unsuccessful, the claimant owes nothing.

How Litigation Funding Works

Specialist funders can cover a wide range of expenses, from legal and court fees to after-the-event insurance that protects against paying the opponent’s costs if the case is lost. In some instances, they may also provide security for costs when required by the court. Litigation funding is often used in commercial disputes, class actions, and insolvency cases.

Benefits and Considerations

One of the main advantages of litigation funding is that it improves access to justice by removing financial barriers. Claimants do not have to risk their own money to pursue a strong case.

Litigation Funding in the UK And Beyond

In the UK, securing litigation funding from a specialist agency such as https://www.novo-modo.co.uk/litigation-funding is a well-established practice and is supported by the courts as a way of ensuring fairness. It is also widely used in other jurisdictions, including Australia and the USA, where it plays a role in levelling the playing field between claimants and larger, better-funded opponents.

Litigation funding provides a practical solution for managing the high costs of pursuing legal action.