LIGHTMAN: system must 'throw away the shackles of past law'


A former High Court judge last week said a radical shake-up was needed in the funding of litigation, calling for contingency fees and for third-party funders to have control over cases they support.



Giving the keynote address at the first international conference on third-party funding, sponsored by the Gazette and its sister publication Litigation Funding, Sir Gavin Lightman said that 'throwing aside the shackles of the past law' on champerty and maintenance 'would release litigants and funders from rules which are positively damaging to the public'.



He added: 'It's only if we come up to date on matters of this sort that we will retain our pre-eminence as a trial centre.'



Lightman said contingency fees are 'eminently preferable' to conditional fee agreements, which he considered 'deficient, if not fatally flawed' for, among other reasons, the 'unprincipled conflict of interest' they cause lawyers when advising clients on whether to settle or discontinue an action.



He explained: 'First [contingency fees] allow lawyers to accept instructions in cases which would not otherwise be commercial for them, in particular under the current 100% uplift limit with conditional fee agreements; and second contingency fees are payable out of the winnings of the proceedings and not by the loser as part of the winner's recoverable costs.'



He described the 'mark of Cain' currently attached to a third-party funder either having a voice in the conduct of litigation or in conducting litigation itself as 'unreal and uncommercial'.



The conference will be reported in full in the April issue of Litigation Funding.



Neil Rose