Study Paper on Financing Litigation

Abstract

Access to the justice system is becoming increasingly difficult for many Canadians. The cost of litigation is an important factor that can determine how much and how often people can pay a lawyer for legal advice and representation. While some disputes can be resolved outside the courtroom, litigation is often the only means to achieve an equitable result. Commencing and participating in the litigation process is expensive and many people lack the financial resources to take on the full cost of bringing their matter to court. This can lead to potentially meritorious cases being barred from access to a just resolution.

This study paper examines the traditional and alternative methods litigants use to pay for litigation. It reviews five financing models that have emerged both in Canada and internationally: 1) unbundled legal services, 2) third-party litigation funding, 3) alternative fee arrangements, 4) crowdfunding, 5) legal expense insurance, and 6) publicly funded litigation funds. The paper identifies 18 opportunities and ideas to consider for structural, systemic or legal change in order to enhance the use of each financing option in British Columbia. It also briefly discusses five alternative ideas that could mitigate the rising cost of legal services, and improve access to justice generally.

Keywords: Civil Litigation, Self-Represented Litigants, Class Actions, Champerty, Maintenance, Legal Aid, Third-Party Financing, Unbundled Legal Services, Crowdfunding, Alternative Fee Arrangements, Legal Expense Insurance, Publicly Funded Litigation Funds, Access to Justice