Litigation Funding – a Tool for Creditors?

Litigation funding is a little used tool that can yield big benefits for unsecured creditors.

If employed strategically by creditors, litigation funding can enable the creditor to seek a priority payment, which may result in a significant recovery.

With the anticipated flood of new insolvencies as a result of the COVID-19 pandemic, being aware of the key factors and best practice has never been more important for creditors and insolvency practitioners alike, especially those creditors seeking to enjoy a priority.

Michael McDonnell, Principal of Results Legal recently published an article in the Australian Restructuring Insolvency and Turnaround Association (ARITA) journal that highlighted the tips and traps for practitioners where litigation funding is used.

These principles are also relevant for credit providers and business advisors.  Using these strategies can reset the balance of power in favour of minority creditors even in the face of what seems to be insurmountable disparities in voting power, having regard to the quantum of the debts.

To find out more, click here to view the full article.

Creditors and insolvency practitioners should obtain specialist advice regarding potential funding matters and the underlying claims and causes that are the subject of potential funding.

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If you require advice on insolvency or litigation funding, or have any questions regarding the article, please do not hesitate to contact our team on 1300 757 534 or via email at You may also use our contact form to send us your enquiries.