Most of our readers will know that we recently had a General Election in the United Kingdom. The electorate was subjected to a blizzard of warnings about what would happen if this party or that party was elected or held the balance of power; what one might call the “what if” scenario.
Now that we know the result, a Tory win, we’re wondering how things will pan out. When with the passage of time we know the answer to that question, no doubt we’ll be examining what would have happened if the result had been different and Labour was in power, almost certainly propped up by the Scottish Nationalists. We’ll be comparing what did happen with what would or could have happened; the factual with the counter-factual.
We all spend a lot of time thinking about what might or what would have happened if……. Authors do it. Think of Robert Harris’s novel Fatherland, which imagines life here if Germany had been victorious in the Second World War. Song writers do it. Think of John Lennon’s song Imagine, which looks at what life would be like if people didn’t fight with each other and lived in harmony. Sports Enthusiasts do it. Think of the 1966 World Cup Final, and whether England would have won if the referee had ruled that England’s third goal hadn’t crossed the goal line. Even comedians do it. Think of the joke about the US Senator who was asked what would have happened if Nikita Khrushchev and not John F Kennedy had been assassinated, and answered that he didn’t know, except he could say for sure was that Aristotle Onassis wouldn’t have married Mrs Khrushchev.
But few people do it more than trial lawyers, and certainly no-one does it more inventively. The whole process of proving loss is about convincing the judge or the arbitrators about what would have been happened if the wrong about which complaint is made had not occurred. In an English law breach of contract claim for example, the Court looks at what would have occurred if the contract had been performed; in a tort claim, it looks at what would have happened if the tort hadn’t been committed.
And this is where the inventiveness comes in. How often do we see a list of highly imaginative and even implausible what ifs strung together to lead to an enormous claim for loss of profits on, for example, a failed joint venture, when the less imaginative and more plausible value of the claim is the sunk costs?
Yet one shouldn’t be too certain logic will always prevail. Some readers may remember the Carlos Tevez affair a few years ago, when West Ham United were in breach of the Premier League rules against third party ownership when they played Tevez. In the final matches of the season, Tevez hit form and scored in a series of matches that West Ham won. West Ham secured three more points over the season than Sheffield United, who were relegated. Sheffield United successfully sued West Ham for breach of the contract to observe the Premier League’s rules which, by virtue of being in the League, all member teams promised each other they would comply with.
To conclude in Sheffield United’s favour, the Tribunal must have decided that, if West Ham had complied with the Rules and Tevez had not played, then in his absence West Ham would not have won at least one of the games they did in fact win. They may have reached that conclusion, because Tevez scored the only goal in the last match of the season against Manchester United, who finished first. But one possible counterfactual would have been whether West Ham would have won that game, or any of the other games they did win with Tevez in the team, if in fact he hadn’t been playing. Who can say? Another counterfactual would have been what would have happened if Sheffield United had won more games than they did win. As it turned out, if they’d won their last game, they would have secured another three points and avoided relegation.
If either of those counterfactuals had commended themselves to the Court, then one assumes Sheffield United would have gone down in the proceedings, as well as from the Premier League.
Entertaining though it is, what does the above have to do with third party funding? To answer that, consider the counterfactual that in his Review of the Costs of Civil Litigation in 2010 Lord Justice Jackson had not supported third party funding but instead concluded it was not in the public interest. If that had happened, there is no doubt that all sorts of meritorious claims would have fallen by the wayside, because the claimants had insufficient funds to pursue them. Access to justice, which must be the prime objective of any legal system rooted in the rule of law, would have been denied. But because that counterfactual did not happen, we see many claims supported by funders such as Vannin going forward and leading to success at trial or settlement, which in the absence of funding would never have been pursued. Defendants would have prevailed when they should not have, and justice would not have been done.
Additionally, we see the UK’s lead being followed abroad. The Jersey court has recently given third party funding its seal of approval, and there are moves afoot in Singapore, as it seeks to establish itself as major arbitration and litigation centre, to the same end. The counterfactual of the UK taking a negative view of third party funding would be surprise and disappointment that a jurisdiction with a worldwide reputation for legal innovation and inventiveness had so surprisingly lost its way.
We at Vannin are delighted that such a counterfactual has been stillborn.
For more information on Vannin Capital, please contact: Leanne Harker, Marketing at Vannin Capital, T: +44 (0)1624 615 111, E: email@example.com