Litigation trafficking: A study on the legality of litigation funding that results into maintenance, champerty or assignment of bare right to litigate to third-party litigation funders taking into consideration the right to access to justice as a means of protecting liberty and nurturing prosperity under the rule of law
Date of Publication
College of Law
Defense Panel Chair
Demetrio C. Custodio, Jr.
Defense Panel Member
Lourdes E.B. Oliveros
Litigation Funding occurs when an assignor-plaintiff assigns his or her bare right to litigate to a third-party litigation funder because of inability to pursue and maintain a legal action due to lack of funds. With this, the third-party litigation funder then shoulders all judicial costs and other out-of-court expenses (e.g., procurement of evidence, representation fees of preferred counsel) arising from the legal action. In return, the third-party litigation funder will receive its share from the amount to be awarded in favor of the assignor-plaintiff should the latter be given a favorable judgment.
Litigation Funding is a tool to promote the Right to Access to Justice of all persons. However, it may result into commercialization of court proceedings lowering such to a mere commodity being passed from one investor to another. As a response, several foreign jurisprudences developed tests to assess the validity of Litigation Funding agreements and ensure that said agreements were entered solely to promote the Right to Access to Justice of a potential plaintiff.
This paper seeks to explore the regulation of Litigation Funding in foreign jurisdictions and incorporate foreign legal doctrines in the Philippine context. This paper assesses the applicability of the tests established by common law courts in determining the validity of Litigation Funding. Additionally, this paper tackles the Right to Access to Justice in relation to the Right to Liberty and Prosperity of the Filipino people. Finally, this paper analyzes relevant Philippine laws in addressing Litigation Funding, particularly the rule on “real party-in-interest” and other pertinent laws on assignment of claims.
Third party litigation funding; Maintenance and champerty
Limosnero, K. G. (2021). Litigation trafficking: A study on the legality of litigation funding that results into maintenance, champerty or assignment of bare right to litigate to third-party litigation funders taking into consideration the right to access to justice as a means of protecting liberty and nurturing prosperity under the rule of law. Retrieved from https://animorepository.dlsu.edu.ph/etdm_law/9
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