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Civil litigation has been the poor relation of the vast bulk of legal activities certainly when set against Commercial Intellectual Property and Construction Law.
The reason for this is that it is often funded by small and very small SEM’s and individuals.
The insurance market is riddled with pitfalls and is reactive rather than proactive.
The bulk funding insurers look at simple and straightforward cases.
They are farmed out to panel solicitors and notwithstanding that people have relied upon a legal expenses indemnity assurance by their broker or within their policy for many years, they are rarely fruitful when it comes to underwriting an action.
The future of litigation, its funding especially for small companies and private individuals may well be in the hands of the Crowd Funding industry.
Crowd Funding in all areas of investment has shown itself to be proactive, imaginative and constructive in dealing with issues. There is often a more personal touch as individuals speak or engage on a level playing field and od not hide behind the faceless bureaucratic and administrative systems which are often the first hurdle in dealing with an insurance company.
Crowd Funding itself needs to be approached carefully and the client given full advice in relation to 3rd party funding of actions and its implications in relation to any Costs Orders.
The Crowd Funding organisations of the individuals whom they represent need to be the subject of careful due diligence.
Not only in terms of their solvency but in terms of their transparency from a Money Laundering protection and Proceeds of Crime Act point of view.
This is the dark side of the spectrum where litigation has been used as a tool by money lenders to fund debt recovery actions that were non-existent in terms of their legal footing but were simply used to transfer funds from A to B.
Whatever the potential pitfalls it will not be long before Crowd Funding forms an initial part of any discussion with a client seeking to take matters forward. In the same way that insurance should be discussed now Crowd Funding should be similarly high on that agenda.