International Litigation Partners Pte Ltd v Chameleon Mining NL

The dispute in *International Litigation Partners Pte Ltd v Chameleon Mining NL* concerned the interpretation of an early termination clause within a litigation funding agreement. International Litigation Partners Pte Ltd (the funder) sought to recover certain fees from Chameleon Mining NL (the company) following the termination of the agreement. The case came before the New South Wales Court of Appeal.

The primary legal issues before the Court of Appeal were whether the funder was entitled to certain supplementary fees after its funding obligations had ceased under the early termination clause, and whether the litigation funding agreement constituted a "financial product" or "derivative" under the *Corporations Act 2001* (Cth), thereby requiring the funder to hold an Australian financial services licence.

The Court of Appeal held that the early termination clause, when construed in its commercial context, meant that the funder's entitlement to fees ceased upon the termination of its obligations. The phrase "immediate payment of the Early Termination Fee" was interpreted to mean only the specified fee, and not to include supplementary fees that would have accrued had the agreement continued. Regarding the *Corporations Act* issues, the Court found that the litigation funding agreement did not constitute a financial product, derivative, or credit facility in a manner that would necessitate a licence, as any financial product involved was merely incidental to the primary purpose of the agreement.

Consequently, the appeal by the funder was dismissed, meaning it was not entitled to the supplementary fees it claimed. However, the cross-appeal by the company was allowed, confirming that the agreement did not require a licence under the *Corporations Act*. The parties were ordered to bear their own costs of the appeal and cross-appeal.