Collective Redress in Scotland: an Introduction

Collective redress mechanisms, also known as group or class actions, are essential for ensuring access to justice and efficiency in cases involving multiple claimants with similar grievances. These mechanisms allow individuals to combine their claims into a single court action. Historically, Scotland lacked a formal class action regime, making it difficult for groups of people to pursue their claims effectively.

Following the passage of the Civil Litigation (Expenses and Group Proceedings) (Scotland) Act 2018, Scotland introduced its first formal group proceedings mechanism in 2020. This regime enables individuals to opt into group claims, improving access to justice for those with smaller or otherwise impractical individual claims. The introduction of this system marked a significant shift in the Scottish legal landscape, aligning Scotland more closely with other jurisdictions that have long-established collective redress systems.

This article explores the trends and developments in Scotland’s group proceedings regime since its introduction. It examines early cases, procedural challenges and the effectiveness of the new framework. It also considers how Scotland’s system compares to other jurisdictions, such as England and the USA, and looks ahead to potential future reforms in the collective redress landscape.

Pre-2020 landscape

Before 2020, Scotland lacked a formal framework for collective legal action, making it tough for groups of claimants to seek redress effectively. Individuals affected by the same issue had to rely on traditional litigation methods, pursuing individual claims. This approach was inefficient and often led to inconsistent outcomes. High costs and risks discouraged claimants with smaller claims from seeking justice.

Some alternative approaches were developed, such as the use of “test cases”, which allowed a single typical case to be taken forward to establish a precedent for others to follow. However, while test cases could streamline some litigation, they did not bind non-parties, leaving many claimants without a clear path to redress.

This pre-2020 landscape often resulted in access-to-justice barriers, especially for consumers, employees or vulnerable groups facing large institutions. The absence of a unified mechanism also led to inefficiency in resolving mass claims, with courts burdened by the need to adjudicate similar cases individually.

Recognising these issues, the Scottish Parliament passed the Civil Litigation (Expenses and Group Proceedings) (Scotland) Act in 2018, paving the way for the introduction of opt-in group proceedings in Scotland in 2020. These reforms aimed to align Scotland with jurisdictions like England and the USA, where class action frameworks were more developed.

The introduction of group proceedings in 2020

The introduction of formal group proceedings in Scotland, through the Civil Litigation (Expenses and Group Proceedings) (Scotland) Act 2018, marked a significant development in collective redress. Coming into effect in 2020, this legislation created an opt-in group proceedings mechanism, allowing multiple claimants with similar factual or legal issues to combine their claims into a single court action.

The new procedure was designed to improve access to justice, particularly for those with small or individual claims that would not be financially viable to pursue independently. By consolidating claims, group proceedings also help to reduce legal costs, increase efficiency and ensure consistency in judicial outcomes for claimants.

Under the new regime, group proceedings are initiated in the Court of Session, Scotland’s highest civil court, which has exclusive jurisdiction over such claims. A lead representative is appointed to represent the group, acting on behalf of all claimants. The process operates on an opt-in basis, meaning individuals must actively join the proceedings in order to participate. The legislation also gives the court broad case management powers to oversee group proceedings, ensuring the process remains fair and efficient, and preventing abuse of the system.

While still in its early stages, the introduction of group proceedings represents a critical step forward for collective redress in Scotland.

Initial trends and cases

Since the introduction of group proceedings in 2020, several significant cases have been brought under Scotland’s new collective redress mechanism. These early cases provide insight into the types of claims likely to dominate the group proceedings landscape, and highlight both the opportunities and challenges in using this legal tool.

One prominent area involves historic abuse claims. In the Celtic PLC Group Proceedings, about 20 former players at Celtic Boys Club are seeking damages for alleged abuse by former coaches and officials. Commenced in early 2022, this action reflects the new regime’s potential to provide access to justice for vulnerable groups who might otherwise struggle to bring individual claims. While the action is currently paused, it has been reported that a settlement is near, giving some insight into the effectiveness of the new process and the possible timescales for a negotiated resolution.

Another significant area involves consumer claims. Following allegations of diesel emissions test manipulation by some car manufacturers, group proceedings have been initiated in Scotland, echoing similar cases across Europe. Thousands of Scottish claimants have joined group actions against manufacturers, seeking compensation for the alleged misrepresentation of vehicle emissions. These cases highlight the ability of Scottish group proceedings to manage large-scale, technical claims involving substantial numbers of consumers.

A particularly notable development involves a personal injury group action brought by approximately 3,500 Kenyan-based tea pickers against a Scottish-headquartered company. The claimants allege that they sustained injuries while working on tea plantations in Kenya due to unsafe working conditions. This case has drawn international attention, as it raises questions about corporate accountability for actions taken abroad by companies with Scottish links. While the case is currently paused pending the claimants seeking redress through Kenya’s Work Injury Benefits Act, it demonstrates the growing reach of group proceedings in Scotland, potentially extending the jurisdiction to claims involving multinational corporations and human rights violations.

These early cases illustrate the versatility of group proceedings in handling a diverse range of claims, from historic abuse and environmental damage to complex transnational human rights and personal injury cases. However, challenges remain, particularly in managing the process of informing potential claimants and encouraging them to opt into group actions. The opt-in nature of Scotland’s group proceedings requires claimants to be actively engaged, which can limit participation compared to opt-out systems in other jurisdictions.

As more cases progress, these trends will offer valuable lessons in refining Scotland’s group proceedings framework for broader and more effective use.

Procedural and policy challenges

While Scotland’s group proceedings regime has introduced important reforms, several procedural and policy challenges have emerged.

One key issue is the opt-in system, which requires claimants to actively join a group action. Although this gives individuals more control over participation, it can limit the overall number of claimants, as some may be unaware of the proceedings or discouraged by the effort involved. In contrast, opt-out models in other jurisdictions, like the USA, automatically include all affected individuals unless they choose to opt out, potentially resulting in broader participation.

Another challenge is defining and managing the class of claimants. Identifying those who belong to the relevant class can be a complex procedure, especially in cases involving large or dispersed groups, such as international claims like the Kenyan tea pickers’ case. Ensuring proper notice and effective communication with potential claimants is resource-intensive and may slow down proceedings.

The role of third-party funding in group actions also raises questions about costs and fairness. While external funding can facilitate access to justice, it may also introduce complexities regarding the distribution of costs and awards. Furthermore, courts must carefully manage these cases to balance efficiency with the need to ensure fair outcomes for all parties.

Comparative analysis with other jurisdictions

Scotland’s introduction of group proceedings in 2020 aligns it with other jurisdictions that have established collective redress mechanisms. However, there are notable differences between Scotland’s opt-in system and the approaches adopted elsewhere, particularly in England, the United States and the European Union.

In England and Wales, collective redress is available through representative actions and group litigation orders (GLOs). The GLO system is like Scotland’s opt-in model, where claimants must actively join the litigation. However, one key difference is the scope of claims: while Scotland’s group proceedings are relatively broad in their application, the English GLO system has more specific requirements and is less commonly used. Across the UK, there is a separate collective redress mechanism for competition law, which has seen significant developments in recent years.

The USA uses an opt-out class action model, where all affected individuals are automatically included in the action unless they choose to opt out. This system allows for broader participation, particularly in cases involving large institutions, consumer rights or employment disputes. The USA class action regime is well established, with a long history of handling large-scale litigation. One criticism, however, is that the opt-out model can lead to cases involving claimants who may be unaware of their involvement, raising concerns about fairness and agency.

In the European Union, collective redress is still developing. In 2020, the EU introduced a directive on representative actions for consumer protection, which should have been implemented in member states by mid-2023; it is understood that this timescale has slipped in several jurisdictions. The directive allows for both opt-in and opt-out systems, giving countries flexibility in their approach. This hybrid model reflects ongoing debates over how best to balance access to justice with procedural fairness.

Comparatively, Scotland’s opt-in system provides claimants with more control, ensuring that only those who actively wish to participate are involved. However, this can limit the number of claimants, reducing the overall impact of the collective action, particularly in cases with dispersed or less-informed groups. As the system evolves, Scotland may look to other jurisdictions, especially the USA and the EU, for lessons on how to streamline procedures and encourage participation

Outlook and potential reforms

As Scotland’s group proceedings mechanism is still in its infancy, there is considerable room for development. Early cases suggest the potential for growth in a range of sectors, particularly in consumer law, environmental claims and human rights-related litigation, such as the Kenyan tea pickers’ case. Looking forward, several trends and potential reforms may shape the future of Scotland’s collective redress system.

One key area for potential reform is the opt-in model. There is ongoing debate over whether Scotland should adopt an opt-out mechanism, as seen in the USA. The Scottish Civil Justice Council has indicated that it may establish a working group to explore this option further. An opt-out system could enhance access to justice by including all potential claimants unless they choose to opt out, increasing the size and impact of group actions. However, such a shift would also raise concerns about claimants’ autonomy and the risk of passive involvement in legal actions.

Third-party funding is another area that could see development. While third-party litigation funding is allowed in Scotland, its use in group proceedings could increase as claimants seek ways to manage legal costs. Once implemented, Section 10 of the Civil Litigation (Expenses and Group Proceedings) (Scotland) Act 2018 will require any third-party funding arrangements in group proceedings to be disclosed. Policymakers may also need to consider more specific regulations around funding arrangements, to ensure that funders do not unduly influence litigation strategies.

More generally, Scottish Ministers are required to review the group proceedings rules and their impact on access to justice and the administration of Scottish courts after five years. This review, scheduled for 2025, must result in a report being laid before the Scottish Parliament, including a statement on whether any modifications to the provisions in the Civil Litigation (Expenses and Group Proceedings) (Scotland) Act 2018 on group proceedings are proposed. This review may identify additional areas for improvement and potential action to enhance the framework for group proceedings.

In terms of sectoral growth, areas like data privacy and climate litigation are likely to become increasingly important. With rising concerns over data breaches and corporate accountability in environmental harm, collective redress could provide a tool for affected individuals to seek compensation. Other emerging risks that may become focal points for group actions in Scotland include claims related to allegedly defective products, greenwashing breaches under Sections 90 and 90A of the Financial Services and Markets Act (FSMA), and personal injury claims against sports governing bodies. Trends in class action litigation from jurisdictions like the USA and England and Wales will also influence Scotland. Claimant firms are expected to replicate successful claims from these regions in Scotland, provided there are grounds to do so.

Overall, while Scotland’s group proceedings mechanism is still in its early stages, the potential for future reform and expansion is significant. As claimants, practitioners and courts gain experience with the system, it is likely that procedural refinements and legislative adjustments will emerge to ensure that group proceedings provide fair and effective access to justice for all.

Conclusion

Scotland’s introduction of group proceedings in 2020 marked a significant shift towards improving access to justice for collective claims. Although still in its early stages, the system has already demonstrated its potential through cases involving historic abuse, consumer rights and international human rights claims.

Compared to other jurisdictions, Scotland’s opt-in model offers more claimant control but faces challenges in attracting large numbers of participants. As the system evolves, debates over the potential introduction of an opt-out mechanism are likely to shape its future.

The courts’ role in managing these complex cases will be pivotal to ensuring fairness and efficiency, with potential for further judicial guidance and procedural reforms. Looking ahead, group proceedings are expected to expand into areas such as data privacy, greenwashing and personal injury, providing a balanced approach to addressing mass harm while ensuring accountability and fairness for all parties involved.