Article 6 of the European Convention on Human Rights states that every citizen has the right to unimpeded access to the courts. Citizens of modest means who cannot afford an attorney might say that principle falls short in practice.
An LFJ Conversation with Michael Kelley, Partner, Parker Poe
Article 6 of the European Convention on Human Rights states that every citizen has the right to unimpeded access to the courts. Citizens of modest means who cannot afford an attorney might say that principle falls short in practice.
Legal Futures explains that the insurance market and third-party legal funding both have a crucial role to play in collective actions, and for individuals who cannot afford to pursue their claims. Yet, there’s an imbalance between access to justice and cost protection. This imbalance has led to claimants, particularly those in class actions, feeling frustrated.
After-the-event insurance is typically used as protection against an adverse costs order, but can also be deployed for the defendant’s costs. But ATE may not always be enough to cover security for costs. So, who bears the financial risk when a David takes on a Goliath? Do the courts ultimately favor the clients with the biggest war chest? What happens when securities for costs are ordered against a third-party funder?
In the so-called Ingenious litigation, a funded case with over 500 claimants sought to recover losses. Defendants filed for security against a litigation funder, requiring that Justice Nugee revisit specific legal points. He ultimately found that ATE policies, in this case, did not provide sufficient protection.
Is the only option for claimants to purchase an anti-avoidance endorsement so that insurers cannot void or terminate a policy? Some say so, despite the significant financial outlay for such an endorsement. Such an expense would ultimately be counted against any future recovery.
