Funding For Insolvent Estates In Asia.
Legal News & Analysis - Asia Pacific - Insolvency & Restructuring
3 July 2020
Access to Justice for Insolvent Estates
Third-party funding has long been recognised as a tool enabling access to justice for impecunious claimants which would otherwise be unable to afford the significant legal costs involved in pursuing large commercial claims.
An insolvent estate is the quintessential impecunious claimant – it may have good claims against deep-pocketed defendants, but due to a lack of resource those claims may not be pursued at all or they may be settled for significantly less than their true value. Legal claims are often the most valuable assets in an insolvent estate and it benefits both creditors and insolvency practitioners to unlock and realise that value.
In 2015, following his review of litigation costs in the UK, Lord Justice Jackson noted, specifically in relation to insolvency claims and addressing the need to maintain access to justice, that:“In larger cases IPs will be able to take advantage of third party funding, which is a new arrival on the litigation scene”. In fact, litigation funding had been available to IPs for many years prior to 2015, but even in 2018 it is still a relatively under-utilised tool in an IP’s armoury.
Litigation funders and insolvency practitioners can be, and are, a very happy marriage; one has access to numerous legal claims but limited funds and the other has funds to unlock and support those claims. Where third-party funding has been used by IPs to date, the outcome has been beneficial for the funders, the IPs – particularly in terms of fee generation – and the creditors alike.
You can read our whitepaper, Funding for Insolvent Estates in Asia below or you can download the PDF here.
For further information, please contact:
Steven Savage, WoodsFord Litigation Funding