Litigation Funding In Jersey

The recent case of Barclays Wealth Trustees (Jersey) Limited as trustee of the R2R Bulgaria Property Fund & Others v Equity Trust (Jersey) Limited & Others [2013] JRC094 provides further clarification as to the position of third party litigation funding in Jersey. The claim itself was by the current trustee and manager of certain funds which had been invested in land in Eastern Europe. The claim was against the former trustee and manager and was for breach of trust, breach of contract and breach of fiduciary duty.

After the commencement of proceedings, the Plaintiffs entered into a third party funding agreement with Harbour Litigation Investment Fund LP.

On being informed of this, the Defendants issued a summons seeking to strike out or stay the proceedings on the basis that their continuance with the funding agreement was contrary to the law of Jersey and/or an abuse of the Court's process. The matter was originally heard before the Master who dismissed the summons. The Defendants then appealed to the Royal Court arguing that the matter should be stayed (rather than struck out) so that it could be permitted to continue without the benefit of funding.

The basis of the Defendants' application was that it was contrary to the Code of 1771 (an early codification of the Island's laws and ordinances). The Code was in French and the...