How Do the Fiduciary Duties of Solicitors and Issues of Conflict of Interest Impact on Class Actions and Litigation Funding?
27 Pages Posted: 16 Sep 2021
Date Written: January 2019
Fiduciary duties and issues of conflict of interest heavily impact on class actions and litigation funding, by limiting the ability of lawyers and funders to act in their own self-interest. The fiduciary duties of solicitors require them to act in the interests of the entire class. There is also some academic support for the proposition that litigation funders owe fiduciary duties but the imposition of these duties may be too onerous for funders and a statutory duty of good faith, analogous to the duty imposed on insurers, may be more suitable. Despite the prevalence of conflicts of interest in class actions, the courts have demonstrated their ability to effectively manage such conflicts on a case-by-case basis. However, the courts may require assistance from third parties such as independent court-appointed costs assessors, contradictors, guardians or even a litigation committee in order to limit conflicts and ensure that there are no breaches of fiduciary duty.
Keywords: class actions; litigation funding; fiduciary duties; conflicts of interest
Suggested Citation: Suggested Citation