Vol 15 (2018) - Issue 2

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Manolete Partners’ Funding Approved in Royal Courts of Guernsey

Summary

The Royal Court of Guernsey has considered for the first time in open court whether a litigation funding agreement was lawful in its jurisdiction or whether it contravened the principles of champerty (i.e. the public policy restrictions on supporting a third party’s litigation in exchange for a share of the proceeds). The decision approved the terms of the standard funding agreement of Manolete Partners PLC ('Manolete'), finding that the agreement was valid and that there was no basis to question the decision of the office holders to enter into a funding arrangement with Manolete. The decision is an important one, as it provides some certainty on an issue which many assumed they knew what the Court’s views would be but did not have any authority from the Court confirming the same. Now they do.