New Appeal: Is third party funding of litigation unlawful?

In this determination (Persona Digital Telephony v Minister for Public Enterprise), the Supreme Court granted Persona leave to appeal the High Court’s finding that maintenance and champerty continue to be torts in Ireland and that there is a prohibition against third party funding of litigation for profit where the funder has no bone fide interest in the dispute.

Background

Persona was one of the unsuccessful bidders for the State’s second mobile phone licence in 1995, which was awarded to Esat Digiphone. Persona claims that the Minister interfered with the competition. But it cannot continue to fund litigation against the State through its own resources. Persona entered an agreement with Harbour Litigation Funding Ltd to enable the continued prosecution of proceedings and applied to the High Court for a declaration that the agreement is not an abuse of process and does not contravene the rules of maintenance and champerty. The High Court refused to grant the declaration sought. Persona sought leave to appeal directly to the Supreme Court, leapfrogging the Court of Appeal.

The Supreme Court determined that, in light of the constitutional principle of access to the courts, Persona raised an issue of genuine public importance which warranted an appeal to the Court. And as the case raised a single legal issue, and as it would be likely that any decision of the Court of Appeal would be appealed, it is a more efficient use of limited court time and resources to grant leave directly to the Supreme Court. The Court granted leave on the issue:

Whether third party funding, provided during the course of proceedings (rather than at their outset) to support a plaintiff who is unable to progress a case of immense public importance, is unlawful by reason of the rules on maintenance and champerty.

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