LITIGATION FINANCE: A NEW TOOL FOR ACCESS TO JUSTICE

INTRODUCTION

Litigation finance is a relatively new concept in India, which has the potential to revolutionize access to justice for the common man. This essay will discuss what litigation finance is, the current state of access to justice in India, how litigation finance can benefit the common man, and how it can help improve access to justice.

LITIGATION FINANCE

Litigation finance is a form of financing that allows individuals and companies to fund legal proceedings. It involves a third-party investor providing funds to cover legal costs and other expenses associated with a case. The investor receives repayment with interest only if the case is successful. This type of financing enables individuals and companies who may not have the financial resources to pursue their legal rights in court.

ACCESS TO JUSTICE IN INDIA

The Indian legal system has long been plagued by delays, backlogs, and a lack of resources. This has resulted in millions of cases being stuck in court for years without resolution or closure. This has made it difficult for ordinary citizens with limited resources to get their cases heard or get justice from the courts.

Access to justice is a fundamental right of every citizen of India, enshrined in the Constitution. However, the reality is that most citizens lack the resources to pursue their legal rights due to financial constraints. This has led to a situation where access to justice is limited only to those who can afford it. Litigation finance provides an opportunity for citizens who cannot afford legal fees or other costs associated with litigation, such as expert witness fees or court filing fees, to obtain financial assistance from third-party investors who are willing to fund their cases in exchange for a portion of the potential award or settlement.

Litigation finance

HOW CAN THE COMMON MAN BENEFIT FROM LITIGATION FINANCE?

Litigation finance can be beneficial for those who cannot afford legal fees or other related costs associated with pursuing their case in court. It allows them to have access to funds that would otherwise be unavailable due to their financial constraints. This can enable them to pursue their legal rights without having to worry about financial considerations getting in the way. Furthermore, litigation finance also helps reduce delays as it provides an incentive for lawyers and law firms to work on cases more quickly since they are assured of payment if they win the case.

HOW DOES LITIGATION FINANCE HELP IN ACCESS TO JUSTICE?

Litigation finance helps provide access to justice by providing an alternative source of funding for those who cannot afford expensive legal fees or other related costs associated with pursuing their case in court. Additionally, it encourages lawyers and law firms to take up cases that may not have been taken up due to financial constraints as they are assured of payment if they win the case. Furthermore, litigation finance also helps reduce delays as it provides an incentive for lawyers and law firms to work on cases more quickly since they are assured of payment if they win the case.

LegalPay has emerged as an answer in this regard, it is an Indian startup that provides legal and compliance services to businesses and individuals. It aims to simplify legal processes and make them more accessible and affordable for everyone. Some of the services offered by LegalPay include Litigation Finance, BNPL and LegalPay Max.

CONCLUSION

In conclusion, litigation finance is a relatively new concept that has potential benefits for those seeking access to justice in India. It provides an alternative source of funding which allows individuals and companies who may not have had access otherwise due to financial constraints, enabling them to pursue their legal rights without worrying about financial considerations getting in the way. Additionally, it encourages lawyers and law firms to take up cases that may not have been taken up due to financial constraints as they are assured of payment if they win the case thus helping reduce delays as well as improving access to justice overall.

REFERENCES:

1) Kumar S., (2020). Litigation Finance: A New Tool for Access to Justice in India? Available at: https://www.lexology.com/library/detail.aspx?g=e2b6a7e2-c1d0-4f44-9fb9-fcec68b6a817 [Accessed 22 Jan 2021]

2) Iyer S., (2020). Litigation Financing – A New Tool for Access to Justice in India? Available at: https://www.mondaq.com/india/litigationdisputeresolution/956873/litigation-financing--a-new-tool-for-access-to-justice [Accessed 22 Jan 2021]

Comments

Post a Comment

Popular posts from this blog

Investments in a new way - Alternative Investment Funds (AIF)

Image
An Alternative Investment Fund or AIF is an investment vehicle that privately pools investments from sophisticated investors, whether Indian or foreign, for investing according to a defined investment policy for the benefit of its investors. These funds are typically used by high-net-worth individuals and organisations since, unlike Mutual Funds, they require a sizable initial investment. AIF as a fund, is typically established or incorporated in India in the form of a Limited Liability Partnership (LLP) or Company or Trust or Body Corporate.[1] Incorporated in 2012 by the Securities and Exchange board of India, the market regulator's intent was to make equity markets more sophisticated for investors with a massive volume of wealth and distinct goals from the average Indian investor. Investors are cautioned not to confuse AIFs with the following financial instruments: Mutual funds, Collective investment schemes, Employee Stock Options Trusts, Employee welfare trusts or gratuit...
Read more

A brief overview - Litigation Funding

Image
“Litigation funding allows lawsuits to be decided on their merits, and not based on which party has deeper pockets or stronger appetite for protracted litigation”   Bond and stock markets both witnessed bull runs from 1980 to 2021, resulting in higher returns for investors. These strong returns have made equity valuations at historically high levels and bond yields at historically low levels, implying that expected returns are currently lower than their historical averages. As a result, the current situation presents difficulties for conventional portfolios, such as a "balanced" 60 per cent equity/40 per cent bond portfolio.   This has caused numerous investors, both institutional and retail, to search for a variety of alternative investments , each with its own set of risks and returns. As a result, they have dramatically increased their allocations to alternative investments, which have significantly less exposure to the economic cycle risk of stocks and bonds as well a...
Read more

Assignment of NRRAs under Regulation 37A

Image
On 13 th November 2020, Insolvency and Bankruptcy Board of India (“ IBBI ”) issued the Insolvency and Bankruptcy Board of India (Liquidation Process) (Fourth Amendment) Regulations, 2020. One of the major purposes, for which this amendment was brought in was to ease the process of sale of liquidation assets. As we all are aware that realization  of some assets (such as continent claims, disputed receivables, disputed assets, refund from government etc.) have been an uphill task for any liquidator. Since realization  of these assets may take quite some time, they are referred in these regulations as ‘Not Readily Realizable  Asset’ or NRRA, which term has been introduced by inserting Regulation 37A. There is always a sense of urgency in a liquidation process and liquidator tries to ensure that the creditors of corporate debtors are able to realize maximum value of the assets of corporate debtor. However, these NRRAs create a sort of hurdle in this urgent process. Regul...
Read more