Giles v. Thompson [1993] 3 All ER 321

 Giles v. Thompson [1993] 3 All ER 321

Parties:  

Plaintiff: Giles  

Defendant: Thompson

Facts:  

This case revolves around the legal concepts of champerty and maintenance. Maintenance refers to the improper support of litigation by a third party, while champerty is a specific type of maintenance in which the third party finances the litigation in exchange for a share of the proceeds.

Giles, the plaintiff, was involved in a road traffic accident and pursued a personal injury claim. Thompson, the defendant, alleged that the claim was funded by a third party who was not involved in the dispute but who had an interest in the outcome of the case. Thompson argued that this arrangement was champertous and therefore rendered the entire claim invalid.

The court had to decide whether the third-party funding arrangement constituted champerty, and if so, whether this should invalidate the claim.

Issues Before the Court: 

1. Whether the third-party funding of the litigation amounted to champerty or maintenance.

2. Whether such an arrangement would invalidate Giles' personal injury claim.

3. How modern legal attitudes toward third-party funding should influence the interpretation of champerty and maintenance.

Decision of the Court:  

The Court of Appeal ruled that while third-party funding arrangements like the one in this case could amount to champerty or maintenance, this alone would not necessarily render the claim invalid. The court recognized that while these doctrines were still part of English law, they had to be applied in a more flexible and pragmatic way, taking into account the evolving nature of litigation funding in modern times.

The court held that not all instances of third-party support of litigation are improper. It noted that the law of champerty and maintenance must adapt to contemporary practices, where third-party funding is often essential to allow individuals access to justice. Thus, the mere fact that litigation was being supported by a third party for financial gain did not automatically make the claim void.

Case Analysis:  

Giles v. Thompson is a significant case in the development of the modern approach to champerty and maintenance in English law. Traditionally, both were viewed as criminal offenses or torts that could invalidate claims. However, this case reflects the evolving attitude of the courts, where the focus has shifted from a blanket prohibition to a more nuanced analysis of whether the arrangement actually corrupts the legal process.

The ruling signals the courts' recognition that third-party litigation funding is not inherently wrongful and can be legitimate, particularly when it helps ensure access to justice for claimants who might otherwise be unable to afford litigation. This case demonstrates the courts' efforts to strike a balance between preventing abuses of the legal process and acknowledging the realities of modern litigation, where third-party funding is often necessary.

Importance:  

Giles v. Thompson is frequently cited in discussions about the modernization of the doctrines of champerty and maintenance. It represents a departure from the strict historical interpretation of these doctrines, acknowledging that third-party involvement in litigation, if properly regulated, can be beneficial and necessary.

The case is especially relevant in the context of contemporary litigation funding and access to justice. It paved the way for the gradual acceptance of third-party funding agreements in the legal system, a trend that has gained further acceptance in jurisdictions like the UK, Australia, and Canada, where litigation funding is now a common practice.

This case serves as a turning point in understanding how the courts apply traditional legal doctrines in the face of changing social and economic realities. It underscores that while champerty and maintenance remain part of the law, their application must be flexible to avoid unjustly barring valid claims.