Ontario Court recognizes litigation financing costs arising from delayed settlement payment
July 30, 2026
The recent Ontario Superior Court decision in Selleck v. Stanutz (Estate), 2026 ONSC 4219 reinforces an important principle: where a defendant's delay in paying settlement funds requires a plaintiff to incur interest on a litigation loan while awaiting the settlement funds, that interest may be fully recoverable from the defendant.
In this case, the Court applied the plaintiff's litigation loan interest rate to a portion of the delayed settlement funds. Importantly, the defendants had been provided advance notice of the terms and interest rate of the litigation loan when the plaintiff requested an advance payment… a request that was denied.
Per Justice MacLeod: “The plaintiffs argue that this higher rate should be used when calculating the interest due on the settlement funds. To do otherwise, rewards the defendant for delaying payment and penalizes the plaintiffs by eroding the value of the settlement. I agree with this analysis. The court has discretion in setting the interest rate to avoid unfairness and to reach a just result.”
This decision highlights the real financial impact that prolonged litigation and delayed settlement payments can have on injured plaintiffs. It also underscores the importance of ensuring clients have access to responsible financing solutions when circumstances require them.
At BridgePoint Financial, we've long believed that litigation funding plays an important role in preserving access to justice; helping plaintiffs meet financial obligations while allowing them and their counsel to pursue fair outcomes without unnecessary pressure to settle prematurely.
While every case turns on its own facts, Selleck is another useful authority for plaintiff counsel when addressing the consequences of delayed settlement payments and litigation financing.
Contact us to learn more about strategies that may help position litigation loan interest for potential recovery, as well as other important precedent decisions involving funding for personal and treatment needs.
Read the case summary of Selleck v. Stanutz (Estate), 2026 ONSC 3219 here:
https://www.minicounsel.ca/scj...
