Winner pays: An alternative method of public funding
-
Ronen Avraham
Abstract
Many meritorious claims do not reach the courts due to the prohibitive costs that are associated with access to justice. While third-party funding, through nonrecourse loans, is often available, the market cannot help all claims. For instance, where the claim lacks clear monetary value (e.g., an injunction), or has little monetary value, market-based funding seems futile.
Inspired by the third-party funding industry, we suggest public, nonrecourse funding. Contingent public funding could broaden access to justice; more importantly, it could bridge the gap between the social and private benefits of the use of the legal system. While private funders are profit-driven, public funding could take into account societal considerations, which should be reflected by the interest on the loan. Lawsuits that provide positive societal benefits—e.g., by clarifying the law and creating important precedents—deserve a lower interest rate.
We demonstrate our suggestion through a simple mechanism, which could easily be integrated into the current system—a conditional waiver of court fees. Under our proposal, at the beginning of a case, judges would be able to defer the payment of court fees. In that case, and similarly to third-party funding, losing lawsuits would be exempt from fees; however, successful plaintiffs would be obligated to pay those fees at the end of the case, multiplied by a certain factor that reflects its social value. We discuss the desirability of such a regime and the ways to mitigate notable concerns, such as a flood of weak cases.
© 2025 by Theoretical Inquiries in Law
Articles in the same Issue
- Frontmatter
- Third-Party Litigation Funding: Past, Present, and Future
- Introduction
- Agency costs in third-party litigation finance reconsidered
- What litigation funders can learn about settlement rights from the law of liability insurance
- Third-Party litigation funding: Panacea or more problems?
- Controlling the delegation of control
- Asking the right questions about legal finance in united states aggregate dispute resolution
- The WHAC-A-Mole game: An empirical analysis of the regulation of litigant third-party financing
- Consumer litigant finance and legal ethics: Empirical observations from texas
- Through a glass darkly: TPLF viewed through a procedural lens
- Third-Party litigation funding in the european union: Regulatory challenges
- Imagining how U.S. federalism would affect third-party funding regulation
- Winner pays: An alternative method of public funding
- The business ethics of litigation finance
- Concealed third-party litigation funding
Articles in the same Issue
- Frontmatter
- Third-Party Litigation Funding: Past, Present, and Future
- Introduction
- Agency costs in third-party litigation finance reconsidered
- What litigation funders can learn about settlement rights from the law of liability insurance
- Third-Party litigation funding: Panacea or more problems?
- Controlling the delegation of control
- Asking the right questions about legal finance in united states aggregate dispute resolution
- The WHAC-A-Mole game: An empirical analysis of the regulation of litigant third-party financing
- Consumer litigant finance and legal ethics: Empirical observations from texas
- Through a glass darkly: TPLF viewed through a procedural lens
- Third-Party litigation funding in the european union: Regulatory challenges
- Imagining how U.S. federalism would affect third-party funding regulation
- Winner pays: An alternative method of public funding
- The business ethics of litigation finance
- Concealed third-party litigation funding
