Neuberger indicates support for contingent legal aid fund

Neuberger: for-profit funders a useful model

The president of the Supreme Court has indicated his support for some form of contingent legal aid fund (CLAF), using third-party litigation funders as a model.

The idea of the CLAF has been debated for decades and is currently being examined by a working party, set up at the urging of Lord Justice Jackson.

In a speech on access to justice this week, Lord Neuberger highlighted the idea of “a privately funded charitable scheme to enable poorer people and small businesses to obtain access to justice”.

Mooted most recently by Lord Justice Jackson in his 2009 report on civil costs, Lord Neuberger said: “It would have involved a substantial sum by way of ‘seed-corn’ funding followed by arrangements whereby, in return for funding litigation costs litigants agreed to pay a proportion (which many thought would not have to be very large) of their damages or other relief to the fund.

“At the time, I understood that the conclusion of those who looked into it was that this proposal was not financially feasible.

“But I wonder. A similar scheme, funded by the Jockey Club, has been running in Hong Kong for some time, although it is fair to say that I believe that it is on a fairly small scale.

“Further, a number of privately funded non-charitable organisations have been established in London over the past 10 years in order to facilitate (or, depending on your view, to cash in on) litigation in this jurisdiction.”

Lord Neuberger acknowledged that such organisations selected the cases which they fund on the basis of their potential profitability rather than merit, but said they may nonetheless represent “a useful model”.

The cross-profession working party is chaired by Justin Fenwick QC and includes representatives of the Law Society, Bar Council and Chartered Institute of Legal Executives.

Last November, it said the benefits of a CLAF were uncertain, with concerns over the need for substantial seed funding among the problems.

As reported on Legal Futures today, the speech also included a devastating critique of legal aid policy and strong support for the idea of “quick and dirty” online dispute resolution for smaller claims.

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