What Is Litigation Funding
The third-party funding or litigation funding is the process where a third party offers the financial assistance for the process of a costly litigation or say arbitration cases to forward it. In this process, the complainant receives the finance to cover its full or partly legal cost from a commercially registered litigation funder. And if the case goes in the favor of the complainant then he receives mutually agreed share from the claim. In opposite to that if the case goes the other way when he loses the money and the litigant does not have to pay anything. This is the process of litigation funding.
Benefits of Litigation Funding
Litigation funding also known as Litigation financing is a good financial tool which offers a superior way for those to go for justice who don’t have funds with them. As of now, the tool is limited to those high commercial cases, but it will play a significant role when I will be accessible to consumer cases, injury cases as well. It undoubtedly provides a worthy financing tool for the plaintiff and attorneys.
Advancement of litigation funding
The litigation financing industry is growing rapidly all around the world. As of now many business houses, making themselves as the providers of capitals for litigation claims. The thing has started in the England & Wales, but spread all over the world within a few years. The role of the Association of Litigation Funders also has become crucial and significant to regulate and check the credibility of the companies in the related field.
Types Of Litigation Funding
There are mainly two parts of litigation funding. They are
- Consumer Funding
- Commercial Funding
Consumer funding is also known as pre-settlement funding. It normally settled within an amount of $500 to $2000. There are many leading consumer financing companies available for the complainants like LawCash, and Oasis Financial company. On the other hand, the commercial funding is all about financing for the firms for their legal claims in terms of their attorney fees and litigation costs. Burford Capital Ltd, IMF Bentham are the key players in the field of Commercial litigation funding.
Litigation funding is not new, as it had started in England & Wales in the year 1967. On the other hand, in Australia, it had started at the dawn of 1990. In England the financing tool can be categorized into four different forms like a conditional fee agreement, damage based agreements, fixed fees and last but not the least third party funding.