Do you or your business have a claim for compensation, which you wish to bring, but you are wary about doing so because of the costs and risks? Are you tempted just to ‘put it down to experience’ despite the fact that you would really rather not?
If so, you are not alone in thinking this way. However, our team of Dispute Resolution solicitors can advise you on a range of funding, risk sharing and insurance options, to help reduce the upfront cost, and the downside risk of pursuing a claim.
You can be sure that whatever your claim (whether for breach of a contract, negligent advice, infringement of your intellectual property, fraud or breach of trust), your opponent is less likely nowadays to roll over, bearing in mind the large court fee of £10,000 which you will have to pay if you wish to issue court proceedings for claims worth £200,000 or more.
Even if you have a good case, your opponent may just do the minimum that it has to do in response to your solicitors’ pre-action letters and then just tough it out, to see if you are prepared to take the plunge and start court proceedings. When acting for claimants, we are certainly seeing more of this type of behaviour on the part of defendants and their insurers.
Of course it is not just court fees that need to be paid. Your solicitor will usually charge their fees as you proceed and there are other expenses, too. In particular a barrister will need to be instructed and you may well need to engage an expert. If you lose, you would almost certainly have to pay a sizeable proportion of your opponent’s costs.
That is where 3rd party litigation funding comes in - if you have a good claim worth around £350,000 or more against a financially secure (or insured) opponent, funding may be available. Funding is also available for a portfolio of lower value claims that collectively have a value which make them economic to fund. The solution can provide funding to meet the cost of high value, complex and heavyweight litigation, too.
Most types of claim for compensation are eligible to apply, except for personal injury or clinical negligence claims.
We have partnered with Augusta Ventures to provide a litigation funding and insurance solution for our clients. The funding can be structured in different ways, but typically Augusta would be willing to fund all of your legal costs, so you would not have to pay anything at all as the case proceeds.
Depending on the nature of the case, however, it may be preferable for you to make a small contribution to the case costs, and for us to put some of our fees at risk. This sort of scenario involves you paying a percentage, say 30% of our fees as the case proceeds, with Augusta paying another 30% of our fees, together with all expenses. We put the remaining 40% of our fees at risk, so that if the case is lost, we do not get paid that 40%.
This is “non-recourse” funding so if the case is lost, Augusta writes off its entire investment and you will not have to repay any of the funding it has paid towards your case. The insurers will meet your liability for the opponent’s costs up to the limit of the policy indemnity, and any fees you have paid to us which are also covered by the costs insurance policy.
The downside? If there is a court award of damages, or a negotiated settlement, Augusta will take its investment and a success fee from the damages or settlement sum recovered. We will take the remaining 40% of our costs and a success fee from the damages or settlement sum if we have put any of our fees at risk, and you receive the rest. In most cases you should receive at least 50% of the overall damages or settlement sum, but the exact percentages will vary from case to case.
So there is a price to pay, but if you do not wish to put your own resources at risk to pursue a good claim, or if you simply cannot afford to do so, funding can still help you to recover a good proportion of the claim value – winnings that you would not have had if you had not been able to launch the claim at all.
We call it “virtually risk-free litigation.” Assuming the costs are proportionate to the value of the claim, it means that you can have access to high quality solicitors, barristers and experts to take your claim as far as necessary to get the right result, whether by negotiating a settlement, or pursuing the case to its conclusion – a true David and Goliath claim can be run at minimal risk. No longer is there a need just to ‘put it down to experience’.
If you would like to discuss whether funding may be available for your claim, please contact Partner, Douglas Skilton, from our Dispute Resolution team by email at firstname.lastname@example.org, or by telephone on 01322 623700.