Third Party Funding in Australia and Europe

Third party litigation funding (TPLF) arises when someone not otherwise involved with a particular litigation2, pays the cost of the litigation for one party, and may also accept the risk of paying the other party's costs if the case fails. 3 In return, if the case succeeds, the third party litigation funder is usually paid a success fee, usually a share of the proceeds (and usually after reimbursement of costs). TPLF is thus to be distinguished from legal expenses insurance (LEI) where an insurer is paid a premium for either before the event (BTE), or after the event (ATE) insurance of legal expenses. TPLF is also to be distinguished from situations where lawyers for a claimant may accept a conditional fee agreement (CFA)4 or a contingency fee.