BCLI’s Study Paper on Financing Litigation: Recent Developments

BCLI’s Study Paper on Financing Litigation: Recent Developments

October 9, 2019

BY Valerie Le Blanc

It’s been two years since BCLI’s Study Paper on Financing Litigation was published. The study paper has been well received by stakeholders, legal academics, lawyers and legal advocates alike.

About the Study Paper on Financing Litigation

The study paper examines the traditional and alternative methods litigants use to pay for litigation. The cost of litigation is a significant barrier to accessing the justice system. While some disputes can be resolved outside the courtroom, litigation is often the only means to achieve an equitable result. However, a litigant’s ability to pay for the legal fees and expenses that come with litigation may become a concern before, or during, the process. Taking a legal dispute to trial is expensive. Many litigants lack the financial resources to take on the risk of an unsuccessful case.

The study paper reviews six financing models that have emerged both in Canada and internationally:

• Unbundled legal services;
• Third-party litigation funding;
• Alternative fee arrangements;
• Crowdfunding;
• Legal expense insurance; and
• Publicly funded litigation funds.

The study paper also identifies 18 opportunities and ideas to consider for structural, systemic or legal change to enhance the use of each financing option in British Columbia. It concludes with a chapter that briefly discusses five alternative ideas that could mitigate the rising cost of legal services and improve access to justice generally. The paper represents a brief introduction to each alternative financing option. The substantive content, research, case law, and other materials are not intended to be interpreted as an exhaustive representation of the information and resources available for study in this area. Research, law, policy and other initiatives continue to develop as more and more opportunities arise to further explore this area.

Noteworthy Updates and Some Recent Developments

Following its release, the study paper continued to generate interest from both the public and legal profession in British Columbia, across Canada, and in the United States. Since its release on October 4, 2017, website statistics report that for the study paper has been downloaded a total of 250 times from the BCLI website and 42 times from the Social Science Research Network (SSRN) website. It was also viewed an additional 295 times on SSRN’s website.

The BCLI remains interested in keeping up-to-date on key research initiatives, reforms and other projects that build-upon the topics covered in the study paper. Some recent updates include:

• Crowdfunding: The Alberta Law Reform Institute (ALRI) project on Informal Public Appeals to examine the use of crowdfunding to support creative ventures and, in some cases, respond to financial needs in case of emergency. The project will review the legal implications of appeals that raise excess funds, and situations where money raised cannot be applied for its intended use. The project page indicates both research and consultation data will be used to develop recommendations for legislation to “clarify the rights and responsibilities of organizers, donors, and beneficiaries.” As of December 4, 2018, the project has been placed on hold for further review by the Uniform Law Conference of Canada.
• Crowdfunding: The Uniform Law Conference of Canada (ULCC) has formed a 10-member working group to revise the 2011 Uniform Informal Public Appeals Act (UIPAA), promulgated in 2011, to address current issues arising from internet-based crowdfunding. BCLI’s Senior Staff Lawyer, Greg Blue, Q.C., who worked on the project to develop the 2011 UIPAA, is a member of the current working group. Mr. Blue has published a blog post on the project and consultation. The online consultation will run until 15 January 2020. A copy of the consultation paper and instructions on how to respond can be found here.
• Class Proceedings: In Fall 2018, the British Columbia Class Proceedings Act was amended to address the use of undistributed funds from class proceedings. Among the changes made is a requirement that a minimum of 50 percent of undistributed funds be allocated to the Law Foundation of British Columbia to address access-to-justice needs. For a comprehensive summary of the changes, see the May 2019 Issue of The Advocate, “The Attorney General’s Page: Class Actions” by the Honourable David Eby, Q.C., Vol 77 Part 3 (May 2019) at 415-420.
• Alternative Fee Arrangements: In Spring 2019, the Quebec Accessing Law and Justice Project (ADAJ) launched a new three-year project, Hub23, aimed at developing innovative practice and alternative billing models for legal services in the province. The goal of Hub23 is to create a modern business model for legal services to meet everyday client needs and ensure sustainable and fair compensation for lawyers.
• Unbundled Legal Services: In April 2019, the Law Society of B.C. established a Licensed Paralegal Task Force to “identify opportunities for the delivery of legal services by licensed paralegals that would benefit the public in areas where there is a substantial unmet legal need.” In consultation with members of the legal profession, the task force aims to determine the education, skills, qualifications, and credentials required for paralegals to deliver legal services.

Statistics on project publications and website engagement since release date

One of the goals of the project is to make its research widely known to interested readers. Here are some statistics, tracking how that information is made available to and accessed by the public, since its publication:

• Number of publications issued: 1, Study Paper on Financing Litigation
• Number of supporting documents issued: 22, including a media release announcing the publication of the Study Paper on Financing Litigation, a backgrounder on the paper, highlights and resources lists for each of the six financing models explored in the study paper and the final chapter on alternative methods of improving access to justice.
• Number of presentations and articles mentioning the study paper: 16
• Number of blog posts on the Financing Litigation Legal Research Project (including this one): 16
• Number of social media posts (Facebook and Twitter): 19
• Number of page views for the project page: 1,181 (between October 2, 2017, and September 4, 2019)
• Number of page views for the Financing Litigation Blog Posts (total): 2,134

This project was made possible thanks to the generous funding from the Law Foundation of British Columbia.