16 October 2008
Collective opt out actions will have far reaching consequences for litigants, say Neil Mirchandani & Dan Armstrong
In the dying days before the summer exodus from Whitehall, the Civil Justice Council (CJC) handed formal recommendations to the government proposing that new legislation be enacted to make collective, opt-out actions generally available in England & Wales. Despite going almost completely unnoticed outside legal circles, these recommendations, contained in a report entitled “Improving Access to Justice through Collective Actions”, could have far-reaching consequences for litigants in various areas including consumer credit, shareholder action, competition and product liability.
Under the present Civil Procedure Rules (CPR), collective redress is primarily pursued via a Group Litigation Order (GLO) or representative action, both of which allow the pooling of claims raising a common grievance or common issues of fact or law. GLOs, however, operate on an “opt-in” basis, meaning that members of the affected class who wish to benefit from the action must first commence their own lawsuits against the defendant, which are then managed collectively, but with the quantum of damages determined on an individualised basis. Representative actions, whilst able to operate
