Sunday 18 February 2018

Firm that funds cases eyes Dublin move as litigation ban tipped to go

Judge Aileen Donnelly
Judge Aileen Donnelly
John Mulligan

John Mulligan

Anglo-US Burford Capital - the world's largest litigation finance provider - is gearing up to establish an office in Dublin in anticipation of a major change to Irish law that would enable firms to provide third-party finance to clients to pursue legal cases.

Burford, with a €1.9bn market capitalisation, provides finance for commercial litigation cases.

Commercial finance provision by a third party to a litigant in the hope of sharing any financial reward, called 'champerty', is prohibited in Ireland. However, lawyers expect the Supreme Court to rule that it will be permissible in future.

Last year, High Court Judge Aileen Donnelly refused permission for a UK firm to fund a legal action being taken by a company co-owned by businessman Tony Boyle against billionaire Denis O'Brien, former Fine Gael minister Michael Lowry and the State.

Mr Boyle has claimed that his company, a consortium called Persona Digital Telephony, failed to secure a mobile phone licence in 1996 that was awarded to Mr O'Brien's Esat Digifone consortium because, he claims, Esat won the licence by bribing Mr Lowry. The politician was the Minister for Communications at the time.

The defendants in the case have all strongly denied the allegations made by Mr Boyle.

Mr Boyle told the High Court that he needs €10m to pursue his case and had sought to use third party funding to do so.

Refusing Mr Boyle's efforts to resort to champerty, Judge Donnelly said last year that such recourse remains unlawful in Ireland. However, she also left it open to an appellate court to determine whether the law should move away from such a prohibition.

The Supreme Court permitted an appeal by Mr Boyle's legal team directly to it, rather than to the Court of Appeal, signifying that the issue is one of significant public importance.

"Burford does not comment on its corporate plans and strategies," said a spokesman for the firm. "However, we have heard repeatedly from Irish companies who are constrained by the absence of litigation finance solutions in Ireland and we hope the Supreme Court in the pending Persona case takes the opportunity to join with the rest of the common law world and endorse litigation finance and the much-needed economic flexibility it provides for lawyers and clients alike."

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