In theory, it is possible for class actions to be brought without debt financing if claimants are willing and able to bear the costs on a traditional basis, including their own attorneys` and payment fees and their possible liability in the event of the failure of the claim. However, in most cases, a group action can only be possible with some form of funding mechanism. Otherwise, potential complainants are unlikely to join the complaint unless their individual rights are important and the chances of success are very high. In response to the defendant`s accusations of ethical incongruity, Gamble`s applicants filed a motion under Rule 16 and the court`s intrinsic power to review the conduct of lawyers appearing before it. As described by the Tribunal, the applicants sought an order „dictating in advance the parameters of any settlement with the defendant“ and asking the court to „give its imprimatur to the applicants` lawyer`s fee agreement and confirm that it does not constitute a conflict of interest with those applicants or the class“. ATE insurance is very often used by plaintiffs in group disputes. The lack of coverage of the ATE may even constitute a factor in the rejection of an application for collective litigation, as this may raise doubts as to the ability of the group of applicants to bear the defendant`s costs if the action fails. The basis for calculating attorneys` fees depends on whether the agreement is a conditional fee agreement (CFA) or a damages-based agreement (DBA). A contingency or contingency fee agreement is usually a „No Win, No Fee“ agreement that provides that the lawyer is only paid if the case is successful. In some cases, it is possible to have a „No Win, Lower Fee“ agreement, but this is less common in the context of class actions.

Similarly, a party using third-party funds is not obliged to inform the opponent of the existence or conditions of the financing agreement. However, the court may order a party to disclose the identity of those who are funding the dispute so that the opponent can verify whether he can claim security for the costs it bears against it. This power has been exercised in the context of collective disputes (see here). The main sources of funding that can be used individually or in combination to fund a class action are: a Federal Court decision provided new guidelines for potential fee agreements stipulating that if a lawyer`s financial performance is to the detriment of his or her client`s recovery, such an agreement may constitute an unacceptable conflict of interest. While lenders of disputes in the UK courts are not allowed to remove control of the dispute from the funded party, they likely wish to contribute to decisions relating to the transaction. The Code of Conduct requires that, if the funder reserves the right to contribute to settlement decisions in the financing agreement, the agreement must also provide that in the event of a dispute between the funder and the party financed on the settlement, a binding opinion from the QC is requested. . .