Sweden
The basis for the judgements of Swedish courts is of course Swedish law. However, the Swedish Supreme court is increasingly turning to jurisprudence from other jurisdictions for case law interpretation and precedents, not least other Nordic countries, when addressing a case of first instance.
Trend-wise, in particular, we have seen an increase in professional liability cases over the last few years, including substantial litigation being brought against former company board members and auditors in Sweden, often related to withdrawal of banking licenses and alleged fraud.
M&A insurance has also seen significant growth in Sweden over the past few years with many disputes related to M&A typically being settled through arbitration.
With our close international collaboration, Eversheds Sutherland is in an excellent position to help our clients taking advantage of the trend of internationalisation.
1. Is third party funding permissible for disputes?
Yes, third-party funding is permissible for disputes in Sweden. Third-party funding is unregulated; there is no legislation or other mandatory rules in Sweden barring the use of third-party funding.
2. Are lawyers able to work on a contingent basis in the jurisdiction and are there any restrictions?
There are ethical standards applying to lawyers practicing in Sweden. The Swedish Bar Association’s Code of Professional Conduct (CPC) governs the financial interests of Swedish lawyers. Save upon a set of exceptional grounds, the CPC prohibits lawyers from executing “risk agreements” or work on a contingent basis, under which the reimbursement constitutes a percentage of the amount recovered by the client.
3. Can the court or tribunal order one party to pay the other’s legal costs?
The philosophy under Swedish law is that a successful party that has not been at fault should not suffer any loss in asserting or defending its right. Consequently, a party that is successful in full is entitled to be reimbursed for its costs relating to the proceedings. An unsuccessful party, on the other hand, is liable for its own expenses as well as those of the opposing party. However, the court or the tribunal may allocate the costs for the dispute differently if the parties, for example, have won in one part and lost in another part.
4. Is insurance available to protect against adverse outcomes for funded litigation?
We are not aware of any specific insurance available to protect against adverse outcomes for funded litigation. However, insurance is available in Sweden to protect against adverse outcomes in general and are known as legal assistance insurances (Swedish: rättsskyddsförsäkring).
Legal assistance insurances often form part of a regular business insurance. However, the legal assistance insurances often have a cap preventing the unsuccessful party from being reimbursed for the whole litigation cost through its insurance.
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