The key document that governs the relationship between a third party litigation funder and a claimant is a litigation funding agreement (“LFA“).

LFAs are complex legal contracts, which are customised to the facts of each individual claim, but the following are the main key elements:

Termination rights

It might seem counter-intuitive to list termination rights as the first key element, but in practice this is one of the most important aspects of the LFA.

As a claimant (or the claimant’s solicitors) you need to be comfortable that once you have entered into a LFA, your funder will provide the agreed level of third party litigation funding until the conclusion of the claim and only pull out if certain objective tests are met.…