Despite the Australian Law Reform Commission’s (ALRC’s) recent recommendations to the Federal Attorney-General from its Inquiry into Class Action Proceedings and Third-Party Litigation Funders, Honan Insurance Group says change is still a way off.
Head of legal, Blair McNamara, said the ALRC’s recommendation to regulate third party litigation funding in Australian and to lift the prohibition on lawyers charging contingency fees would impact current conditions.
“I do not see contingency fees being for lawyers as a drastic or alarming development so long as the change is supported by appropriate safeguards”, said McNamara.
He said whilst corporate Australia may not universally see such a change as positive, it was important to note:
- The ALRC recommendation is limited to class action litigation only filed in Australian courts;
- A lawyer’s percentage-based fee should absorb all legal costs and disbursements; and
- Percentage-based fee agreements are only permitted with leave of the Court.
The head of legal said change was a way off given the reform proposal was at federal level, and any change to removing prohibitions on contingency fees would need to transpire at state and territory level.