In our October 2012 legal update we reported on the Court of Appeal's decision in Contractors Bonding Limited v Waterhouse  NZCA 399. In that decision, the Court of Appeal ordered the plaintiff to disclose to the defendant certain details relating to its litigation funding arrangement including:
- The identity and location of the litigation funder
- Its financial standing and viability
- Its amenability to the jurisdiction of the New Zealand Courts, if that was relevant
- The terms on which funding could be withdrawn and the consequences of withdrawal.
That decision was then appealed to the Supreme Court. The Supreme Court modified the disclosure guidelines, noting that when proceedings are issued that are to be funded by an unrelated third party litigation funder, the funded party should disclose to both the court and the other party or parties, the identity and location of the funder, and whether or not the funder is subject to the jurisdiction of the New Zealand courts. This is necessary because the assistance of a litigation funder is relevant to applications for security for costs and costs. Generally speaking, however, there is no need to disclose litigation-sensitive material, including the terms on which funding may be withdrawn, or details of the financial standing of the funder.
The Supreme Court also emphasised that it is not the courts’ role to act as general regulators of litigation funding arrangements, or to give prior approval to such arrangements, at least in cases not involving a representative action. In doing so, however, the Supreme Court was careful to note that it was not commenting on the Court's supervisory role in representative actions.
See here for the full decision.