IMF Bentham will seek to assist the ALRC inquiry into third-party funding and class actions

Contact:
Andrew Saker
Managing Director and CEO | +61 8 9225 2300 | [email protected]

PERTH, 20 December 2017On 15 December 2017, George Brandis QC, the then Attorney General announced an Inquiry into third-party litigation funding and class action proceedings, to be conducted by the Australian Law Reform Commission (ALRC). Class actions have become a familiar part of Australia’s legal landscape and the Turnbull Government wishes to ensure that the costs of such proceedings are appropriate and proportionate and the interests of plaintiffs and class members are fully protected.

The Inquiry will be a further review of litigation funding, following the Victorian Law Reform Commission review (currently underway) and the 2014 Productivity Commission Report. The 2014 report rejected contentions that litigation funding facilitates unmeritorious claims and that funders take advantage of plaintiffs, finding no evidence that would lead it to believe these are current or likely future problems, or that the courts and regulators are not able to address problems if they emerge. The Commission found that: "Litigation funding can promote access to justice by providing finance for the prosecution of genuine claims by claimants who would otherwise lack the resources to proceed."

IMF Bentham welcomes the Inquiry, and looks forward to assisting the ALRC to conduct a balanced, evidence-based review of the litigation funding industry. For many years IMF Bentham operated under ASIC’s licensing regime, and now does so under conflict regulations and other procedures and laws which apply to it. IMF Bentham has been a constant and enthusiastic proponent of regulation in a measured and proportionate manner, endorsing the 2014 Productivity Commission’s recommendation to introduce minimum capital adequacy requirements.   

IMF Bentham pioneered third-party funding in Australia and is a publicly listed company on the Australian stock exchange with a current market capitalisation of more than A$450m. We believe ethics and transparency are key components of third-party funding. However, the industry now has a global footprint with many new entrants, and the costs of litigation are increasing. It is in everyone’s interests to ensure industry participants, including funders and legal service providers, meet best-practice standards so that the legal system can more readily dispense justice in an efficient and accessible manner. The ALRC’s Inquiry offers the potential to establish a new regulatory regime which would not only apply to funders operating in Australia, but could be exported globally – another opportunity for Australia to innovate and lead the world in this sector.

Over 16 years, IMF Bentham has returned on average 62% of litigation proceeds (AUD$1.3billion in total) to our funded clients. Without third party litigation funding, many of Australia’s most prominent cases would not have proceeded and justice would have been denied to thousands of ordinary Australians.

IMF Bentham is available to assist the ALRC Inquiry, however it can.

Andrew Saker
Chief Executive Officer

Media/Further information:     
John Gardner Citadel-MAGNUS         +61 413 355 997