Litigation Loans And Adverse Cost Insurance - An Update - The Doctrines Of Champerty And Maintenance

• Published date: 08 April 2021
• Law Firm: McCague Borlack LLP
• Author: Mr Van Krkachovski and Ryan R. Taylor

Following the publication of the article Litigation Loans and Adverse Cost Insurance in March 2021, the writers received a question regarding the interplay between the doctrines of champerty and maintenance and its effect on litigation loans.

The Black's Law Dictionary definition of 'maintenance' is as follows:

An officious intermeddling in a lawsuit by a non-party by maintaining, supporting or assisting either party, with money or otherwise, to prosecute or defend the litigation.

'Champerty' is defined by Black's Law Dictionary as follows:

A bargain between a stranger and a party to a lawsuit by which the stranger pursues the party's claim in consideration of receiving part of any judgment proceeds; it is one type of 'maintenance', the more general term which refers to maintaining, supporting or promoting another person's litigation.

Both of these concepts are...