India
Answer ... There is no specific concept of litigation funding in India.
However, debts and actionable claims are normally assigned in
financing transactions, such as assignment of debts and actionable
claims from banks to asset reconstruction firms. Further, in A
K Balaji, third-party funding was duly recognised by the
Supreme Court, which held as follows:
In India, funding of litigation by advocates is not
explicitly prohibited, but a conjoint reading of Rule 18 (fomenting
litigation), Rule 20 (contingency fees), Rule 21 (share or interest
in an actionable claim) and Rule 22 (participating in bids in
execution, etc.) would strongly suggest that advocates in India
cannot fund litigation on behalf of their clients. There appears to
be no restriction on third parties (non-lawyers) funding the
litigation and getting repaid after the outcome of the
litigation. In U.S.A., lawyers are permitted to fund the entire
litigation and take their fee as a percentage of the proceeds if
they win the case. Third Party Litigation Funding/Legal Financing
agreements are not prohibited. In U.K., Section 58B of the Courts
and Legal Services Act, 1990 permits litigation funding agreements
between legal service providers and litigants or clients, and also
permits third party Litigation Funding or Legal Financing
agreements, whereby the third party can get a share of the damages
or "winnings".
In 1955, in Re: Mr 'G', a Senior Advocate,
the Supreme Court held that:
- the rigid English law rules of champerty and maintenance do not
apply in India; and
- "A contract where one party agrees to fund litigation for
certain benefits would be legally unobjectionable if no
'lawyer' was involved and it was between third
parties."
In 1876, in Ram Coomar Coondoo v Chunder Canto
Mookerjee, the Privy Council permitted third-party funding on
the grounds of promoting access to justice, but held that:
agreements of this kind ought to be carefully watched, and
when found to be extortionate and unconscionable, so as to be
inequitable against the party; or to be made, not with the bona
fide object of assisting a claim believed to be just, and of
obtaining a reasonable recompense therefore, but for improper
objects, as for the purpose of gambling in litigation, or of
injuring or oppressing others by abetting and encouraging
unrighteous suits, so as to be contrary to public policy, effect
ought not to be given to them.
India
Answer ... There is no legal finance regime in India. In fact, there is no specific law on legal finance; instead, agreements such as the assignment of debts and actionable claims are governed by the Contract Act, 1872.
Also, please see question 2.1.
India
Answer ... Depending on the nature of the claim, the dispute and the debts, the courts/authorities responsible for enforcing the applicable law and regulations are numerous and diverse. For instance:
- in case of an acknowledged debt, the authority responsible for enforcing the applicable law is the National Company Law Tribunal; and
- if the dispute arising from the agreement specifies resolution by way of arbitration, the courts responsible for enforcing the applicable law are the arbitral tribunal, the district courts, the high courts or the Supreme Court, as the case may be.
India
Answer ... There are no such organisations or professional associations for legal finance in India at this stage.
India
Answer ... As legal finance is currently evolving, there are divergent views among supporters and critics on the desirability of this practice in India. Despite implicit recognition by Indian courts, there is no express legislation regulating third-party financing of litigation. Under Order XXV of the Civil Procedure Code, 1908, some states (Maharashtra, Madhya Pradesh, Gujarat and Karnataka) have acknowledged the concept within their territories and have stated the circumstances in which financiers may be impleaded as parties to the dispute and can be induced to furnish security on behalf of the plaintiff.
Third party legal finance also received a favourable reference in the report of the High-Level Committee on the Institutionalisation of the Arbitration Mechanism in India (2017).
India
Answer ... No. Please see questions 1.4, 2.1 and 2.2.