Lord Neuberger’s Lecture referenced in case discussing modern status of champerty and funding

6 June 2015 – In the recent judgment in JEB Recoveries LLP v Binstock, the Judge referred frequently to Lord Neuberger’’s remarks made in the inaugural Harbour Lecture in 2013, in explaining his thinking about the nature of funding and assignments of claims.

The case concerned an application to strike out a claim as champertous where it had been assigned to an LLP, which had been formed to pursue the assigned claim and in which the assignor had a one-third interest. The court declined to strike out the claim.

HHJ Simon Barker QC (sitting as a High Court judge) referred to Lord Neuberger’’s remarks in the Harbour Lecture that “public policy, which is the bedrock of maintenance, is never static” and his revival of “a question raised by Jeremy Bentham: why should individuals have to bring claims at their own expense? Lord Neuberger’s answer included the observations that one of the fundamental principles underpinning any self-respecting legal system is that rights must be capable of enforcement, and that it is ironic that the original medieval rationale for the prohibition (protecting the weak and the poor from exploitation by the rich and powerful) now has the opposite effect of affording wealth a monopoly of justice against poverty.”

After referring to the inroads made into the prohibition against maintenance, Barker HHJ cited Lord Neuberger’’s conclusion that “the public policy rationale regarding maintenance and champerty has turned full circle so that relaxation of the policy against maintenance and champerty may be justified to help safeguard the rule of law; and that, given the retreat from legal aid, the development of litigation funding as a means of securing access to justice may well gain more traction.”

This is very much consistent with Harbour’’s experience. As well as organisations looking to control their legal costs spend and manage downside risk, Harbour receives increasing numbers of applications for funding, both in the UK and worldwide, from those who would otherwise not be able to pursue their legal rights.

The judge has given permission to appeal on the basis that it involves an important point of law. Harbour will watch the progress of the case with interest.

View all news items