Farrar v Miller. One to watch on champerty and litigation funding in the form of assignment.

In Farrar & Anor v Miller [2022] EWCA Civ 295, the issue is whether a firm of solicitors which has been acting for a claimant in litigation pursuant to a damages-based agreement can validly take an assignment of their client’s cause of action.

It is the common law of champerty which militates against law firms acting ostentatiously as a party with a purely commercial interest in the litigation and it is their role as officers of the court which is cited as being core of the hesitation (see inter alia the EP study on third party litigation funding here). In England and Wales it was the rules against maintenance and champerty that, prior to 1990, led to solicitors ia not being able to conduct litigation pursuant to conditional fee agreements -CFAs.

Statute then intervened to change this in narrowly defined circumstances  (CFAs and damages-based agreements only) however that did not lift the common law’s general opposition to same and it is this opposition which both the first instance judge and the Court of Appeal refer to to reject the possibility of assignment: [52]

the Assignment is neither a conditional fee agreement nor a damages-based agreement: what section 58(1) and section 58AA(2) show is that Parliament, being well aware of the common law rules, decided to go so far towards relaxing them as sections 58 and 58AA provide and no further.

Permission to appeal with the Supreme Court is being sought.

Geert.

A few recent examples of English Courts and English law’s knack for regulatory competition.

Update 26 11 2021 for the Law Commission’s advice to the UK Government on smart legal contracts see here. It includes a section on jurisdiction and applicable law.

Update 02 April 2021 for a review of the EC consultation on the issues see Matthias Lehmann here.

Update 13 October 2020 for the New Zealand view holding that that a cryptocurrency constitutes property at common law and is therefore capable of being held on trust, see [2020] NZHC 728 Ruscoe v Cryptopia Limited (in Liquidation) and see here and here.

Update 27 May 2020 for the French view on the nature of Bitcoin, see the decision of the courts at Nanterre of February 2020.

Update 21 January 2020 for the cryptoassets issue, see AA v Persons Unknown & Ors, Re Bitcoin [2019] EWHC 3556.

Happy 2020 reading, all!

At the back of my mind I have a number of interesting examples of the English Courts and English law’s awareness of the relevance of courts and substantive law in regulatory competition. I post them here together by way of illustration.

Sir Vos’ speech on how English law on cryptoassets should develop so as to boost the confidence of would-be parties to ‘smart’ legal contracts; a further analysis of same by the  UK jurisdiction taskforce’, and Outer Temple’s reaction to ditto.

Also however RPC’s review of Davey v Money [2019] EWHC 997 (Ch), in which Snowden J declined to cap a litigation funder’s liability for adverse costs at the amount of funding provided: essentially adding a potential risk to be considered by third-party litigation funders and illustrating that attractive as England may be as a forum for litigation, the sector is not a free for all.

Finally, the English courts are not of course alone in the realisation of the issues: witness this 2017 report by the French Supreme Court: ‘”Le juge et la mondialisation”.

Geert.

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