Third-Party Litigation Funding: Current State of Affairs and Prospects for its Further Development in Spain

EUROPEAN REVIEW OF PRIVATE LAW Vol. 22, 2014

MAASTRICHT EUROPEAN PRIVATE LAW INSTITUTE WORKING PAPER No. 2014/20

36 Pages Posted: 11 Nov 2014

Date Written: November 10, 2014

Abstract

Third-party litigation funding (TPLF) is a promising and fascinating practice that is receiving increasing attention. However, TPLF is still a novel institution, and hence there exists certain controversy as to what it actually stands for. In order to bring some clarity in this regard, a definition of TPLF will be provided. This definition will be used to compare TPLF with other ways of funding litigation disputes, to investigate its origins, and to examine its advantages and disadvantages. Nonetheless, the main purpose of this article is to shed light as to two supplementary issues. On the one hand, this article will show what is the current state of affairs of TPLF. For that purpose, a comparative analysis of several countries will be provided. This will show that TPLF is commonplace in common law countries such as Australia, though virtually non-existent in civil law countries. On the other hand, in order to determine the prospects for TPLF to expand into jurisdictions in which it has not developed so far, Spain will be taken as an example. This analysis will show that the possibilities for TPLF to grow in Spain are rather promising as TPLF may help overcome some of the challenges currently faced by the Spanish civil justice system. In addition, TPLF seems to be legally viable under Spanish law.

Keywords: Litigation costs, litigation funding, comparative law, Spanish law

JEL Classification: K12, K41

Suggested Citation

Cojo Manuel, Oliver, Third-Party Litigation Funding: Current State of Affairs and Prospects for its Further Development in Spain (November 10, 2014). EUROPEAN REVIEW OF PRIVATE LAW Vol. 22, 2014; MAASTRICHT EUROPEAN PRIVATE LAW INSTITUTE WORKING PAPER No. 2014/20 . Available at SSRN: https://ssrn.com/abstract=2521347

Oliver Cojo Manuel (Contact Author)

Arias SLP ( email )

Calle Velázquez 18, 3D
Madrid, 28001
Spain

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