The Andrews Labor Government will look at ways to better protect Victorians from unfair risks and disproportionate costs when they seek to enforce their rights in court using litigation funders.
Attorney-General Martin Pakula has asked the Victorian Law Reform Commission (VLRC) to review the rules covering litigation funders to prevent unfair conduct in civil proceedings, such as class actions.
Litigation funders generally agree to fund part or all of a plaintiff’s costs of a civil court proceeding in exchange for a share of any award to the successful plaintiffs.
The review will look at circumstances where a successful outcome may be unduly eroded by fees, leaving plaintiffs with virtually nothing despite successfully arguing their case.
The review will also consider whether some third parties are unfairly profiting from successful actions, denying Victorians access to justice.
Consideration will also be given to the existing prohibition on law firms charging contingency fees and whether, and in what circumstances, that prohibition should be retained.
The VLRC will provide its report to Government by 30 March 2018.
Quotes attributable to Attorney-General Martin Pakula
“This review will consider how we can better protect Victorian consumers from unfair costs, while ensuring that law firms and litigation funders continue to support worthwhile claims.”
“It is incredibly frustrating when a person wins a case, only to walk away almost empty-handed because the money has been soaked up by unfair legal fees.”
“The days of some litigation funders charging such excessive fees need to come to an end.”
Reviewed 19 August 2020