Metzler v. Gildan Activewear
Irish funder to give adverse costs indemnity in exchange for 7% after legal fees and disbursements.
No cap on recovery to funder.
Defendants were “affected” by the agreement, and entitled to notice of motion and to make submissions on it (para. 3).
“The ability to terminate the Agreement without cause should  be deleted with the result that [the funder] may only terminate its obligations if the plaintiff fails to fulfil its obligations under the Agreement or appoints different lawyers to replace the present lawyers as the Agreement now provides” (para. 60).
“This plaintiff is not impecunious and may well have the means to pursue litigation. However, I do not find it improper that it seeks to reduce the risks which a class proceeding exposes them to” (para. 67).
Could not determine if the agreement was champertous at this stage, because do not yet know if the fees received will be fair and reasonable. . . funder might be “overcompensated” (para 70-72).
Because Court could not assess whether compensation was fair and reasonable, without knowing what that compensation would be, would not approve funding agreement in advance. Agreement therefore not approved.
Action settled in 2011.