Unresolved claims are an asset but are often perceived as risky, expensive and time consuming to pursue. Many businesses can’t – or don’t want to – commit the resources, both human and financial, to pursue a claim and are deterred by the risk of losing and having to pay their opponent’s legal costs in addition to their own.
We are experts at providing innovative solutions to these problems, so that our clients can pursue claims at little or no upfront cost or risk to them.
Our team of over 40 lawyers has a wealth of experience of assessing, running and winning claims where part or all of our fees are only paid on a successful outcome and providing litigation finance and insurance solutions to guard against litigation risk.
Litigation funding involves a party unconnected to the claim (such as a hedge fund) taking the following financial risks in return for a payment if the claim is successful:
The amount to be paid to a litigation funder on the successful outcome of a claim is agreed with them at the outset and varies depending on the type of claim, the choice of funder and their risk analysis as well as our assessment of the claim. The payment to the funder is typically comprised of: (i) the return of what they paid out during the claim; and (ii) a multiplier of the amount of the funding requirement or a percentage of the amount recovered from the opponent. Such multipliers or percentages often increase in stages as the claim progresses.
We have over 12 years’ experience of using litigation funding to run our own client’s claims as well as helping institutional litigation financiers to assess and monitor cases referred to them by other law firms. We also advise funders and other professionals on the regulatory aspects of litigation funding and how to structure funding, insurance, contingent fee agreements and litigation management agreements.
In 2016, we collaborated with a hedge fund to improve access to justice by providing faster claim assessments and more competitive financial terms. This was designed for those with claims of a value traditionally ignored by other funders (e.g. claims under £10m). We were highly commended by The Financial Times Innovation Awards, The Lawyer, and The Legal Week. Our lawyers have also been recognised by the Legal 500 as forerunners in the use of litigation funding.
We also have an in-depth knowledge of the ‘after-the-event’ insurance market where we aim to complement any funding and fee arrangement with an appropriate insurance product to cover the financial risk of losing the claim and having to pay an opponent’s legal costs. Through years of working with these insurers, we know what they are looking for and can expedite insurance applications ranging from traditional forms of adverse costs protection to more bespoke coverage such as obtaining ‘cross undertaking’ insurance as part of a court application to freeze an opponent’s assets.
‘We were the first client to use Capital's litigation funding and within 5 months of entering into the funding agreement, we achieved a fantastic settlement at mediation – a result that we are delighted with.
Without the litigation fund, we would not have been able to unlock our claim which was clearly an asset to our company. Our opponent had deep pockets, but the backing of Capital’s fund gave us gravitas and access to justice that we would not have otherwise had.’