9 May 2013Print This Post

Neuberger: "quick and rough justice" may be way forward for smaller claims

Neuberger: litigation funding is not without risks

“Quick and rough justice” may be a better solution for relatively small claims than invoking the full force of the Civil Procedure Rules and requirements such as disclosure and cross-examination, the president of the Supreme Court has suggested.

Delivering Harbour Litigation Funding’s first annual lecture in London – ostensibly charting the history of barretry, maintenance and champerty to litigation funding – Lord Neuberger expressed concern over access to justice for small claims where legal aid has been withdrawn and the economics do not work for conditional fee agreements (CFAs), damages-based agreements (DBAs) or third-party funding.

He said the responsibility for addressing the problem does not just lay with the government: “All those involved in the legal system, that is litigators and judges, have a vital role to play in improving access to justice. And that means cost-effective justice. The reforms propounded by both Woolf and Jackson are based on the need for proportionality. So far as is consistent with it being even-handed, principled, and clear, justice must be practical and realistic…

“Quick and rough justice is better than no justice, and for many people with relatively small claims, no justice may be all that is on offer, unless one is prepared to take a disproportionate risk. And, in ordinary cases, quick and rough justice, whose costs are commensurate with the issues involved, may actually mean better justice than would be achieved by incurring cost and delay by invoking the full force of the Civil Procedure Rules.”

Echoing comments he first expressed more than a year ago, the judge continued: “Disclosure and cross-examination may alter the outcome in a few cases, but I do wonder how cost-effective they are in the great run of average cases in which ordinary citizens are involved. But these general comments are much, much easier to express than they are to put into effect.”

On litigation funding, Lord Neuberger said the original, medieval rationale for maintenance and champerty – as a means to help secure the development of an inclusive, pluralistic society governing by the rule of law – had turned full circle and “the exact reverse of the prohibition is justified for the same reason”.

He recognised that it is still early days for the Association of Litigation Funders and said developing and promoting any form of litigation funding is “not without risks”, such as being used to bring unmeritorious claims in the expectation that, once the opposing side is aware of the existence of funding, they are more likely to be brought to settle in order to buy off the claim.

“The problems which arose after the 1999 [Access to Justice] Act’s amendments to CFAs could be replicated if less than scrupulous funders provide funding… The ethical pressures on lawyers to which any of these funding arrangements may give rise must also be acknowledged. The pressures will presumably be heavier with CFAs and DBAs where there is a real opportunity for conflict of interest for the lawyers, as they have a financial stake in the outcome of the litigation concerned…

“Third party litigation funding does not give rise to such problems, but the commercially driven pressures from expert serial litigation funders on lawyers could be significant.”

By Neil Rose