A director of a company that funds litigation on behalf of the company (either by paying the solicitors directly, by making a loan, or by injecting capital into the company) can end up being personally liable not only for the costs of fighting the company’s case, but also for the opponents’ adverse costs.

Where the company itself cannot pay an adverse costs order, the opponent will want to see if another party, such as the director, ought to be paying the adverse costs.

So when can an opponent look to a director to pay those costs, and what should directors be aware of before deciding to fund litigation?

The background

Generally, the loser of litigation is expected to pay (part of) the...

To continue reading

This article is part of our subscription-based access. Please pick one of the options below to continue.

Already registered? Login to access premium content

Not registered? Subscribe