Litigation Assistance Fund

The Litigation Assistance Fund (LAF) is a non-profit charitable trust for which the Law Society acts as trustee. It began operations in 1992. Since then, it has provided funding assistance to approximately 1,500 civil claimants in South Australia. The damages ultimately received by those claimants totals in excess of $300 million.

Rule 16A of the Australian Solicitors’ Conduct Rules requires South Australian solicitors to inform their clients about LAF in certain circumstances.

As legal practitioners know, government-funded representation is often available to under-resourced litigants in criminal matters and family matters. When it comes to civil matters, this is not usually the case. Civil litigants can access a variety of free or low-cost services offering one-off general advice but often not ongoing representation. In many instances, this gap is filled by civil litigation practitioners prepared to act on a contingency or even pro bono basis. The profession is well aware of the valuable role played by JusticeNet in the pro bono context.

However, this is not a complete answer. In some cases, firms are able to act on a contingency basis, but not able to incur disbursements on behalf of their clients. Sometimes the scale of a matter, or its longevity, will make it impossible for a firm to act on a contingency basis. The list of potential hurdles is a long one. In some such cases, LAF is able to assist.

Funding Eligibility and Application Requirements

LAF receives applications for funding assistance from solicitors on behalf of civil claimants seeking compensation/damages who are unable to meet the fees and/or disbursements of prosecuting their claim. The applications are subjected to a means test and a merits test, and the final decisions on the applications are made by Assessment Panels and/or the Advisory Board of LAF, which are constituted of senior practitioners. Applications can be made at any time during the course of a claim. If funding is granted, it is granted on a 'stage by stage' basis. Small or large amounts of funding can be sought - including for only some of the claim's disbursements.

An application form (see below) must be completed by both the applicant and the applicant's solicitor. There is no application fee for Pension Card or Automatic Issue Health Care Card holders, but otherwise the application fee is $100, or $250 for an urgent application. Solicitors should have regard to section 14A of the Legal Practitioners Act 1981 (SA).

LAF cannot assist in family law or defacto relationship law matters including those involving property issues.

Most applicants to LAF are personal injury claimants. LAF suggests that claimants/solicitors with a different type of civil claim, who are considering applying, first contact the LAF Manager, Annie MacRae, for a brief discussion.

Types of Available Funding

LAF provides two different forms of funding – Disbursements Only Funding (DOF) and Full Funding. The distinction is important.

In summary, in DOF matters, claimants receive funding only to meet disbursements, and this does not include counsel fees. In DOF matters, it is a condition of the grant of assistance that the solicitor (and any counsel) enter into a contingency fee agreement with the claimant which establishes that in the event of the action being unsuccessful the solicitor and counsel will not charge the claimant.

In Full Funding matters claimants receive funding to meet solicitor/counsel fees as well as any disbursements. The Fund pays "solicitor/client costs" (not "solicitor/own client" costs) on the scale appropriate to the jurisdiction.

Most of the matters currently funded by LAF are DOF matters. LAF suggests that claimants/solicitors who are considering applying for Full Funding, first contact the LAF Manager, Annie MacRae, for a brief discussion.

How the LAF itself is funded and how this affects claimants

LAF received an initial grant of funding upon its inception in 1992, but does not receive any ongoing government funding or any donations or grants. Instead, it funds itself by receiving a relatively small portion of the monetary proceeds (usually damages) achieved by the claimants whom it assists. Claimants who received DOF funding repay the amount received, plus an uplift of 100% on that amount. However, for new applications received from 1 January 2023 where liability is already admitted (and where LAF decides to grant funding due to being satisfied as to the other usual requirements, eg: quantum), that uplift figure will be 50% rather than 100%. Claimants who received Full Funding repay the amount received, plus 15% of their damages. This ensures LAF’s ability to continue to provide assistance. Claimants whose claims are ultimately unsuccessful are not required to make any repayment to LAF (and nor are their solicitors). However, the Fund does not pay costs awarded in favour of another party against the claimant.

Assessment of LAF Applications

LAF’s need to earn income is one of the reasons applications to LAF are subjected not only to a means test but also to a merits test. In essence, a decision is made as to the likelihood of the claim succeeding (as well as its likely quantum and the recovery prospects) because LAF can only continue to assist claimants if it regularly receives the repayment and uplift amounts which flow from successful cases. The repayment and uplift amounts received are used entirely for the continued operation of LAF. This, of course, is the crucial difference between LAF, which is a non-profit charitable trust, and commercial/private litigation funders, which can receive vastly higher portions of claimants’ damages for commercial profit purposes.

To satisfy the means test, the applicant can have a family income of up to $150,000, and assets of “reasonable” value including a house and car.

Important Considerations

LAF recommends that claimants who are considering applying to LAF ask/remind their solicitor to consider carefully whether an application to LAF is the most appropriate course in the circumstances of the claim. In particular, claimants/solicitors should investigate whether there may be other and better potential methods of obtaining funding/representation in relation to the claim.

It should be noted that, if an application to LAF is approved, claimants and their solicitors are asked to enter into a Funding Agreement with LAF. This gives LAF certain rights and powers, including that funding can be withdrawn and/or varied.

Further, it should be noted that, in relation to DOF funding, if during the life of the claim the claimant can afford to fund some of the disbursements themselves, it may be in their interest to do so, due to the 100% uplift.

Case Studies of LAF Funding Outcomes

Case Study #1

Jane (name changed for privacy purposes) spent much of her 20s, 30s and 40s plagued by health problems. She was told these were a series of separate issues. Then, in her mid-40s, she suddenly discovered that a brain scan taken 20 years earlier had clearly demonstrated that she was suffering from a neurological condition – but due to a baffling oversight, that diagnosis was not communicated to her and was not acted upon.

Jane and her solicitors (Nick Xenophon & Co) faced an uphill battle to establish that the hospital had breached its duty of care to her and also that her health outcomes would have been significantly better if the diagnosis had been acted upon earlier.

What impact would earlier treatment have had? Would her neurological condition have responded well to the treatments available at the time? As in almost all medical negligence matters, obtaining a number of expert reports dealing with these and other issues was critical, but Jane could not raise the funds required to pay for these.

On Jane’s behalf, Nick Xenophon & Co applied to LAF for these disbursements to be funded, and this was approved. In total, LAF then paid just under $25,000 for expert reports from two neurologists, a psychiatrist, a rehabilitation specialist and an occupational therapist.

In June 2024 Nick Xenophon & Co wrote to us to let us know that the matter settled for a satisfactory sum and “thank you for funding this case; our client is very appreciative of LAF’s support”. LAF is proud to be able to help claimants achieve results like this one.

Case Study #2

In 2006, Deakon Schwarze was delivered by emergency caesarean section at the Women’s & Children’s Hospital. He was eleven weeks premature and as soon as he was delivered, he was observed to be having difficulty breathing spontaneously. A specialist resuscitation team was called to attend but the equipment used was not immediately effective.

Deakon survived but was subsequently diagnosed with cerebral palsy, chronic lung disease, autism spectrum disorder (ASD), severe intellectual disability and an inability to swallow. For the rest of his life, Deakon will require supervision 24 hours a day.

Deakon’s parents engaged DBH Lawyers and lodged a claim for damages arising out of the failure to resuscitate Deakon effectively. As in almost all medical negligence matters, obtaining a number of expert reports dealing with this and other issues was critical, but Deakon's parents could not raise the funds required to pay for these.

On Deakon's behalf, DBH Lawyers applied to LAF for many of these disbursements to be funded, and this was approved.

In May 2021, the Honourable Chief Justice Kourakis awarded Deakon damages amounting to $9,500,000. Although the sum awarded in damages cannot make up for the injuries Deakon suffered through no fault of his own, the money does at least bring some peace of mind in that his complex and ongoing care needs will be met in the future.

Case Study #3

Luke* is a 5 year-old boy who suffers from severe brain damage, resulting in very severe developmental delay. He is going to remain fully dependent on others for his whole life. His family’s commitment in caring for him and ensuring his safety is remarkable.

This is the reality for Luke and his family because his birth did not proceed as expected. Monitoring of Luke’s vital signs during labour began to show that he was in distress. Eventually a decision was made by the hospital staff to proceed to an emergency Caesarean Section, but this happened too late to avoid the brain damage to Luke. As soon as he was born, he required resuscitation with intubation, ventilation and adrenaline. He went into cardiac arrest. He survived, but the brain damage suffered was irreversible.

Luke’s parents engaged Mellor Olsson Lawyers and lodged a claim for damages against the hospital. Pursuing this claim was a long, complicated and contested process. As in almost all medical negligence matters, obtaining a number of expensive expert reports was critical. On Luke's behalf, Mellor Olsson Lawyers applied to LAF for many of the disbursements in his case to be funded, and this was approved – including disbursements for a trial if necessary.

In the end, Luke’s case was fully resolved after mediation, only weeks before a trial was set to begin. Through the expert reports, Mellor Olsson were able to establish that on the balance of probabilities, Luke’s catastrophic injuries and disabilities were caused by negligence at the hospital. Luke was awarded damages exceeding $16,000,000 and his parents also received compensation for their psychological injuries.

Although the sum awarded in damages cannot make up for the injuries Luke suffered through no fault of his own, the money does at least bring some peace of mind in that his complex and ongoing care needs will be met in the future.

*Luke’s name changed to protect privacy

Application Forms and Rules

For DOF applications:

For Full Funding applications:

Further Information

Please contact the Manager of the Fund, Annie MacRae, on (08) 8229 0263 or [email protected].

Send Annie an email