Collective Redress & Class Actions 2023 Comparisons

Law of Equity

A mechanism for collective redress has existed in England for over 200 years. It originated under the law of equity in the chancery courts so that a group of parties with “a common interest and a common grievance” could be represented by one or more members of that group. One of the earliest instances of such an action was where certain creditors of a deceased debtor were able to bring a claim on behalf of all the creditors.

Rules of the Supreme Court

Eventually, towards the end of the 19th century, the Rules of the Supreme Court were introduced to codify the law and to bring the common law and the law of equity in this area, and generally, into line. The rules stated that where there are numerous persons with the “same interest”, one or more of those persons may sue or be sued for the benefit of all the interested persons.

Civil Procedure Rules

While English courts were, and still are, able to use their case management powers to manage a group of claims informally, other formal mechanisms became available following the introduction of the Civil Procedure Rules in 1999 (CPR). The introduction of these mechanisms under the CPR was largely in response to an increase in multiparty litigation throughout the 1980s and 1990s.

Amendments Since 2000

Representative actions procedure

Rule 19.6 was added to the CPR in May 2000 and provides for a representative actions procedure which, similar to the earlier Rules of the Supreme Court, permits a party to sue, or be sued, as the representative of a class of individuals, provided that one or more of the persons in that class has the same interest as the representative. Historically, this mechanism has been used infrequently due to the strict interpretation and limited scope of the phrase “the same interest”.

However, it was put under the spotlight by virtue of Lloyd v Google (2021) UKSC 50 (“Lloyd”), a high-profile, large-scale data breach action that came before the UK Supreme Court (UKSC) in April 2021. In its long-awaited judgment handed down on 10 November 2021, the UKSC overturned the ruling of the Court of Appeal, thereby disallowing data privacy actions that require an individual assessment of loss or damage to be brought on an “opt-out” basis pursuant to the representative actions procedure. The UKSC’s decision affirms the court’s stringent approach to the “same interest” test. Subsequent representative actions that had been brought against other global technology companies in relation to alleged breaches of data protection rules were later withdrawn by the claimants due to legal uncertainty around privacy class actions in the wake of Lloyd – see 1.2 Basis for the Legislative Regime, Including Analogous International Laws and 4.4 Class Members, Size and Mechanism (Opt In/Out).

Group litigation orders (GLOs)

The amendments to the CPR in May 2000 also introduced group litigation orders (GLOs) in response to the perceived inadequacy of the existing collective action mechanisms and in order to allow the court to properly manage claims brought by a large number of claimants whose claims shared common issues of fact and law. 

Collective proceedings orders (CPOs)

In a similar vein, in 2015, an opt-out collective proceedings regime was established by the Consumer Rights Act 2015 (CRA) for bringing private competition claims in the Competition Appeal Tribunal (CAT) as the existing regime for such claims, which operated on an opt-in basis only, was considered to be too narrow to provide effective redress to claimants. Similar to the representative actions procedure, this regime has been used relatively infrequently, although there has been an increase in applications for collective proceedings orders (CPOs) following the UKSC decision in Merricks v Mastercard (2020) UKSC 51 (the “Mastercard litigation”). The UKSC ruled that the matter was suitable for a hearing under the regime and on 18 August 2021 the first-ever CPO, since the introduction of the regime in 2015, was granted by the CAT. 

In the above case, the UKSC rationalised the “opt-out” collective proceedings regime by quoting from Judge Posner in a US case: “The realistic alternative to a class action is not 17m individual suits, but zero individual suits, as only a lunatic or a fanatic sues for $30.”

The regime now is seeing an increasing number of standalone actions rather than just “follow-on” claims which rely on a decision made by a competition authority. Since the UKSC’s decision in the Mastercard litigation, 31 CPO applications have been filed, with several having been granted by the CAT on an opt-out basis. Many of these actions are being pursued against global technology companies in relation to alleged breaches of competition law.

Representative actions and GLOs in the UK are not modelled on the regime of any other country, having arisen spontaneously and then been enshrined in law.

The representative action and collective proceedings regimes are similar to the US class action regime as they are opt-out regimes. However, both are more limited in scope than the US class action regime, as representative actions are subject to the “same interest” requirement, and only private competition claims can be brought under the collective proceedings regime.

There is no applicable information in this jurisdiction.

The court can use its case management powers pursuant to CPR 3 to manage claims brought by multiple claimants without the use of a formal mechanism. Multiple claimants can bring their claims by issuing a single claim form against one or more defendants. The court also has power under CPR 3.1 to:

• consolidate multiple, similar individual claims into a single set of proceedings (CPR 3.1(g));
• try two or more claims on the same occasion (CPR 3.1(h)); or
• add new claimants to existing proceedings (CPR 19.4).

These types of actions are referred to in this chapter as “informal group action mechanisms”. 

Test cases may be utilised as part of a GLO, but as noted above, they can also be used outside the GLO regime.

Representative Actions

Representative actions are governed by CPR 19.6, while CPR 19.6(1) sets out the “same interest” test outlined above. 

GLOs

The rules governing GLOs are set out in Part III of CPR 19, and Practice Direction 19B. CPR 19.10 defines a GLO as an order “to provide for the case management of claims which give rise to common or related issues of fact or law (the ‘GLO issues’)”.

CPR 19.11 empowers the court to make a GLO where there are, or are likely to be, a number of claims giving rise to the GLO issues, and it states that a GLO must:

• contain a direction to establish a group register listing the relevant claims;
• specify the GLO issues which will identify the claims to be managed as a group under the GLO; and 
• specify the court that will manage the claims on the group register.

Collective Proceedings

Collective proceedings before the CAT are governed by the Competition Act 1998 (“CA98”) as amended by the Consumer Rights Act 2015. All referenced sections below are to the CA98.

Section 47B(1) provides that collective proceedings may only be brought before the CAT in relation to two or more claims to which Section 47A applies, namely:

• a claim for damages;
• any other monetary claim; and
• a claim for an injunction within proceedings in England and Wales or Northern Ireland.

Collective proceedings may continue only if the CAT makes a CPO (Section 47B(4)). 

Section 47B(6) provides that claims are eligible for inclusion in collective proceedings “only if the Tribunal considers that they raise the same, similar or related issues of fact or law and are suitable to be brought in collective proceedings”. Pursuant to Section 47B(7), a CPO must include the authorisation of the person who brought the proceedings to act as representative, a description of a class of persons whose claims are eligible for inclusion in the proceedings, and it must specify whether an opt-in or opt-out mechanism is to be used. The CAT may authorise a person to act as the class representative even if the representative does not fall within the class itself, provided that the CAT considers it just and reasonable for that person to be appointed as representative (Section 47B(8)). 

Opt-in collective proceedings are defined as collective proceedings which are brought on behalf of each class member who opts in by notifying the representative, in a manner and by a time specified, that their claim should be included in the collective proceedings (Section 47B(10)). 

Opt-out collective proceedings are those where any class member can opt out by notifying the representative, in a manner and by a time specified, that their claim should not be included in the collective proceedings, although Section 47B(11)(b) excludes class members who are not domiciled in the UK at the time specified and who do not opt in to the proceedings in a manner and by a time specified. 

Schedule 8 of the CRA 2015, the Competition Appeal Tribunal Rules 2015 (“CATR” or the “CAT Guide”) set out the relevant procedure for bringing claims in the CAT, as described in 4.2 Overview of Procedure. 

In principle, there is no limitation on the areas of law or types of dispute in relation to which informal group action mechanisms or representative actions can be brought. 

In practice, representative actions have, to date, only been brought in a small number of claims, although they have included claims by stallholders seeking to restrain the owner of Covent Garden from overcharging them (Duke of Bedford v Ellis (1901) A.C. 1); ship-owners against a lead underwriter and the subscribing market for payment of sums ordered to be paid under an arbitration agreement (Irish Shipping Ltd v Commercial Union Assurance Co plc (1991) 2 QB 206); by both owners and housing association sub-tenants living in a block of flats, in relation to generic defects in the block (Millharbour Management Ltd v Western Homes (2011) EWHC 661 (TCC)); and, more recently, although so far unsuccessfully, large-scale data breach actions.

GLOs can be brought in respect of claims in a variety of areas, including product liability, shareholders’ actions, pension disputes and financial services. They are frequently brought in relation to product liability claims, often those involving pharmaceuticals and medical devices, care home or school abuse claims, taxation disputes, environmental cases (eg, claims relating to landfill and bad odours), and employment-related personal injuries.

Collective proceedings may be brought in relation to two or more claims for damages, another sum of money, or an injunction in relation to competition claims regarding, among other things, agreements preventing, restricting or distorting competition and abuse of dominant position.

Representative Actions

CPR 19.6 defines representative actions as: “Where more than one person has the same interest in a claim (a) the claim may be begun; or (b) the court may order that the claim be continued, by or against one or more of the persons who has the same interest as representatives of any other persons who have that interest.”

The term “same interest” has been considered by the courts on numerous occasions in cases going back over 100 years. The Court of Appeal’s judgment in Jalla v Shell International Trading and Shipping Co Ltd (2021) EWCA Civ 1389, sets out the following requirements and limitations with regard to representative actions, which also includes a helpful summary of the relevant case law.

• A representative action requires congruity of interest between representative and represented and the need for certainty at the outset about the membership of the represented class.
• The representing parties must have “the same interest in a claim” as the parties they represent.
• “The same interest” is a statutory requirement which cannot be abrogated or modified and has been described as “a non-bendable rule”.
• The represented parties need to have the same interest in a claim as the representative because they are bound by the result of the representative action.
• The court will adopt a common-sense approach to this issue. It must be the same interest “for all practical purposes” (Irish Shipping) or it must be “in effect the same cause of action or liability” (Millharbour Management).
• In cases where “the wrong is the same, the loss claimed is the same” (Lloyd v Google (2019)), the parties do have the same interest.
• A representative action is not precluded simply because the represented parties have separate claims for damages, especially where the damages claimed are secondary to, for example, injunctive relief (Duke of Bedford).
• It is necessary to consider the available defences and if different defences are available in each claim, it is unlikely the represented parties have the same interest.

The UKSC’s judgment in Lloyd v Google (2021) provides clarity on the interpretation of the “same interest” requirement in the context of large-scale data breach actions. In this action, Mr Lloyd brought a claim against Google alleging that it had breached its duty as a data controller under the old Data Protection Act 1998 (DPA 1998) by tracking the internet activity of Apple iPhone users, without their knowledge, and thereafter selling the acquired data. Mr Lloyd brought a representative action on behalf of the class of affected iPhone users (estimated to be approximately 4.4 million), claiming damage for distress and anxiety in relation to the loss of control of the data. The Court of Appeal held that (i) damages are, in principle, capable of being awarded for loss of control of data, even where there is no pecuniary loss or distress suffered by an individual claimant; and (ii) Mr Lloyd met the requirements of a representative action on the basis that those he sought to represent did have the “same interest”. The Court of Appeal held that “the data in possession of Google will be able to identify who is, and who is not, in the class”. 

Google appealed to the UKSC, which unanimously allowed the appeal. The UKSC held that to bring a claim for compensatory damages for a breach of the DPA 1998, a claimant must establish that there has been a breach, and that damage, in the form of material damage or distress, has been suffered as a result. As this would involve an assessment of individual damages and loss, the claim could not proceed as a representative action under CPR 19.6 as the “same interest” requirement had not been met. In cases requiring an individual assessment of damages, the UKSC suggested that the representative action procedure could still be used to determine common issues of fact or law, leaving issues that require individual determination to be dealt with subsequently.

Since Lloyd, two more decisions have addressed the “same interest test” under CPR 19.6.

The High Court’s decision in Commission Recovery Ltd v Marks & Clerk suggests the courts may take a more flexible approach in interpreting the “same interest” guidance for representative actions under CPR 19.6. This case concerned proceedings brought by Commission Recovery Limited (CRL) against Marks & Clerk LLP, a law firm specialising in IP services, and its associated firm, Long Acre Renewals, in relation to alleged undisclosed commission payments. After considering the approach taken in Lloyd v Google, J Knowles concluded that “we are perhaps still in the foothills of the modern flexible use of CPR 19.6, alongside the costs, costs risk and funding rules and practice of today and still to come”. More specifically, the court will not allow its analysis of the “same interest” requirement to be diminished by the apparent complexities of a case, nor the fact that there may be insufficient factual information about each claim. The court also suggested that varying levels of quantum claimed will not prevent the court from finding that the same interest requirement has been met. Where there is uncertainty over whether the opt-out representative action procedure is appropriate, but where there is no alternative, the judgment suggests that the court is more likely to exercise its discretion to allow the action to proceed on an opt-out basis. Indeed, this flexible interpretation of CPR 19.6 may well be used more frequently as the digitalised world is increasingly likely to give rise to mass harms, resulting in affected claimants seeking legal redress.

The High Court’s ruling in Prismall v Google UK Limited & Deepmind Technologies (2023) was, however, more akin to the decision in Lloyd. This representative action was brought on behalf of 1.6 million people whose medical records were used by Deepmind (a Google subsidiary) for the development of an app. The court ruled that the claim did not satisfy the “same interest” requirement under CPR 19.6 and the claimants were required to establish individual damage or distress. Here, the claimant faced similar difficulties as Mr Lloyd. The court ruled that claimants need to demonstrate that each member of the claimant class has suffered more than a trivial loss and damage in order for the representative action to proceed. 

GLOs

CPR 19.10 defines a GLO as: “an order made under rule 19.11 to provide for the case management of claims which give rise to common or related issues of fact or law (the ‘GLO issues’)”.

CPR 19.11 gives the court the discretion to make a GLO when “there are or are likely to be a number of claims giving rise to the GLO issues”. The granting of a GLO is at the discretion of the court rather than the parties’ right. The court may set up a GLO of its own volition.

There is no minimum number of claims required before the court can grant a GLO: it must be “far more than two” (Alyson Austin v Miller Argent (South Wales) Limited (2011) EWCA Civ 928) but can be fewer than 20 (The Corby Group Litigation).

The test of “common or related issues” is not as narrow as the “same interest” test for representative actions. By way of example, the following were found to fulfil the test:

• claims to establish whether British Airways (BA) was liable to the claimants, or any of them, in relation to breaches of BA’s IT systems and, if so, which claimants were entitled to damages;
• claims against the Post Office regarding false allegations against employees resulting in the suspension or termination of their employment and the pursuit of civil proceedings and/or criminal charges against them; and
• claims brought by Zambian claimants against a local Zambian mine operating company and its English parent company in relation to injuries caused to the claimants as a result of pollution arising from the mining activities of the local Zambian company.

The following were found not to be suitable for a GLO:

• unfair contract claims by borrowers against a bank, as it would be necessary to examine each claimant’s individual circumstances (Tew v BOS (Shared Appreciation Mortgages) No 1 plc (2010) EWHC 203 (Ch));
• claims against a hospital regarding a wide range of complaints (Various v Barking, Havering & Redbridge University Hospitals NHS Trust (2014) (QB)); and
• “[a]typical” claims in relation to hip replacements by anonymised and foreign claimants (Schmitt and others v DePuy International Ltd (2016) EWHC 638 (QB)) (although GLOs have been granted in relation to a number of other actions concerning allegedly defective hip replacements).

Despite the GLO regime being introduced over 20 years ago, only 114 GLOs have been recommended or granted by the court (currently 112 GLOs are reported on the High Court’s website, while two others have been recommended). Only 32 of those were granted between 2012 and 2022. The High Court recommended a GLO in the claim of Tongue & Others v Bayer Public Ltd Company & Others (2023), one of only two GLOs authorised by the High Court in 2023. This case confirmed some of the factors it would consider when exercising discretion to make a GLO:

• the claims give rise to common or related issues of fact or law; and
• there are a sufficient number of claimants who seriously intend to proceed in their claims giving rise to those issues.

The Tongue judgment also discusses a new form of collective case management which it labels “GLO Lite”. This suggests the development of a new informal mechanism for managing class actions. A GLO Lite is intended by the court to “manage the cases in a similar way to a formal GLO but without making the order”. A GLO will provide for a group register, a cut-off date, and significantly, that findings on generic issues are binding on all the parties, whereas a GLO Lite will not.

Collective Proceedings

Section 47B(6) of CA98 states that claims are eligible for inclusion in collective proceedings “only if the Tribunal considers that they raise the same, similar or related issues of fact or law and are suitable to be brought in collective proceedings”.

This is supplemented by Rule 79(1) of the CATR which states that the CAT must be satisfied that the claims “are brought on behalf of an identifiable class of persons... raise common issues... and... are suitable to be brought in collective proceedings”.

When deciding whether the claims are suitable, the CAT takes into account all matters it sees fit, including a number of specific matters:

• whether collective proceedings are an appropriate means for the fair and efficient resolution of the common issues;
• the costs and benefits of continuing the collective proceedings;
• whether any separate proceedings making claims of the same or a similar nature have already been commenced by members of the class;
• the size and nature of the class;
• whether it is possible to determine in respect of any person whether that person is or is not a member of the class;
• whether the claims are suitable for an aggregate award of damages; and
• the availability of alternative dispute resolution and any other means of resolving the dispute, including the availability of redress through voluntary schemes.

This definition was recently interpreted by the Supreme Court, and applied by the CAT, in the Mastercard litigation, which made the following findings.

• The evident purpose of the statutory scheme for collective proceedings was to facilitate rather than to impede the vindication of the rights of consumers arising out of a proven infringement.
• Both of the main issues in the case were common issues, which was an important plus factor in the balance.
• The matters listed in Rule 79(2) were not to be treated as hurdles but rather, as factors to be weighed in the balance.
• The court should construe suitability in the relative sense, and take into account the need to consider whether individual proceedings were a relevant alternative (which they were not in the particular case).
• The court must do what it can with the evidence available when quantifying damages, and not allow forensic difficulties and shortcomings in the likely availability of data to lead it to a conclusion that claimants with a real prospect of (some) success should be denied a trial by the only practical procedure available to them.

It should be noted that the claimants in the Mastercard litigation already had a finding of breach of statutory duty in their favour which may have assisted their case for collective proceedings.

The various mechanisms for bringing a collective redress/class action in the UK have already been described, but are summarised here.

In England and Wales

• A representative action can be brought in the court pursuant to CPR 19.6 by one or more claimants on behalf of an undefined set of claimants who are purported to have the “same interest” in a claim. Representative actions have, to date, been pursued in the High Court but they can also be brought in the county court.
• A GLO can be requested pursuant to CPR 19, Section III, where claims give rise to common or related issues of fact or law. GLOs are typically issued and managed in the High Court but they can also be brought in the county court.
• The court can use its case management powers pursuant to CPR 3 to informally manage claims brought by multiple claimants without the use of a formal mechanism. This enables the court to manage the claims flexibly and to retain control over the litigation.

Across the UK

Section 47B of the CA98, as amended by Schedule 8, paragraph 5 of the Consumer Rights Act 2015, enables consumers and businesses to bring collective proceedings in the CAT in relation to infringements of UK competition law that raise “the same, similar, or related issues of fact or law” (Rules 79(1)(b) and 73(2) CATR). 

Informal Group Action Mechanisms

There is no specific or special procedure governing claims pursuant to informal group action mechanisms. As set out in 1.1 History and Policy Drivers of the Legislative Regime, the courts will use their case management powers under the CPR to manage claims brought by multiple claimants, which will give the courts flexibility and control over the litigation.

Representative Actions

Other than that set out in CPR 19.6 and discussed in previous answers, there are no other specific rules governing the procedure of representative actions.

GLOs

Practice Direction 19B sets out the procedure for applying for a GLO, the operation of the group register and how the GLO will be managed by the court.

Individual claimants are required to issue their own respective claim forms and apply to join the group register. If a party applies to the court seeking approval for a GLO, a claimant must demonstrate that there are “common related issues of fact or law”.

Where appropriate, the court may make a GLO of its own initiative. For example, in Dominic Lis Waniso Lungowe & Others v Vedanta Resources PLC & Another (2020) EWHC 749 (TCC), the court, of its own volition, made a GLO in circumstances where two claimant law firms commenced separate proceedings for two sets of claimants. Both proceedings shared common issues of fact and law and were therefore suitable for a GLO. Accordingly, Mr Justice Fraser held that the defendant should only have to deal with one single set of proceedings and not two considerable-sized ones. 

GLOs benefit from active case management by the court. Upon the granting of a GLO, a case management conference will be fixed at which the court may give directions:

• varying the GLO issues;
• providing for one or more claims on the group register to proceed as test claims (commonly referred to as “lead claimants”);
• appointing the solicitor of one or more parties to be the lead solicitor for the claimants or defendants;
• specifying the details to be included in a statement of case to show that the criteria for entering the claim on the group register have been met;
• specifying a date after which no claim may be added to the group register unless the court gives permission; and
• allowing the entry of any particular claim which meets one or more of the GLO issues on the group register.

The group register is usually maintained and kept at the court but the court may direct that solicitors for one of the parties take responsibility for it. 

GLOs are automatically allocated to the multi-track, which is the track suited to high-value, complex and multiparty litigation. A managing judge will be appointed to manage the GLO and hear the GLO issues. To support the judge with the administration of a GLO, a master or district judge may also be appointed to deal with procedural matters in accordance with directions given by the judge. A costs judge may also be appointed, particularly if the GLO is subject to costs budgeting.

Collective Proceedings

Collective proceedings are a form of procedure and do not establish a new cause of action; each individual claim must be a claim to which Section 47A of the CA98 applies (see 2.1 Collective Redress and Class Action Legislation). 

Collective proceedings are governed by rules 75–93 of the CATR. There are four stages to a collective proceedings action:

• the making of a CPO;
• a trial of the common issues;
• determination of any individual issues; and
• the distribution of any damages.

Unlike ordinary civil proceedings under Section 47A of the CA98, collective proceedings must be approved by the CAT, with such approval comprising authorisation of the class representative and certification of the claim as eligible for inclusion in collective proceedings. The claim can only proceed if a CPO is issued by the CAT.

Similar to GLOs, collective proceedings (particularly under the opt-out regime) are subject to intensive case management by the CAT so as to ensure that the interests of the CAT are adequately protected.

The CAT issued a new Umbrella Proceedings Practice Direction in 2022. Under that practice direction, where one set of proceedings raises issues, matters or features which are shared with otherwise unrelated proceedings, the CAT may group the proceedings together under a common designation or “umbrella”. From that point onwards, the CAT will deal with and dispose of these matters in the “umbrella proceedings”.

There is also a procedure governing collective settlements, which is described in further detail in 4.12 Settlement and ADR Mechanisms.

Informal Group Action Mechanisms and GLOs

There are no rules or restrictions on standing, where multiple claims are managed by way of informal group action mechanisms or a GLO. Claimants are to commence their own individual actions, before they are managed in accordance with these mechanisms. 

In certain GLOs, it may be appropriate for the court to select a sample of the claimant group to act as test claims that will give rise to sufficient common findings to apply to the remaining cohort of claimants.

Representative Actions

In contrast, a representative action must be brought by, or against, one or more persons who have the “same interest” in a claim, as discussed in 1.1 History and Policy Drivers of the Legislative Regime.

Collective Proceedings

Collective actions brought in the CAT may be brought by a claimant, or a class representative who need not be a class member. The class representative must be certified by the CAT before it is permitted to commence proceedings. In so doing, the CAT will consider whether it is just and reasonable for the class representative to be appointed, having regard to specific criteria, including whether the proposed CAT representative would act fairly and adequately in the interests of the class members and to ensure that, in relation to the common issues of the class members, it does not have a material interest that is in conflict with the interests of the class members.

In determining whether the proposed class representative will act fairly and adequately in the interests of the class members, the CAT will have regard to a number of circumstances, including:

• whether the proposed class representative is a member of the class, and if so, its suitability to manage the proceedings;
• if the proposed class representative is not a member of the class, whether it is a pre-existing body and the nature and functions of that body; and
• whether the proposed class representative has prepared a plan for the collective proceedings that satisfactorily includes –
1. a method for bringing the proceedings on behalf of represented persons and for notifying represented persons of the progress of the proceedings;
2. a procedure for governance and consultation which takes into account the size and nature of the class; and
3. any estimate and details of arrangements as to costs, fees or disbursements which the CAT orders, and which the proposed class representative will provide.

Informal Group Action Mechanisms

These procedures operate on an opt-in basis, meaning that claims are brought on behalf of identified claimants who have authorised the claims to be brought on their behalf. There are no limits on the number of claimants using these mechanisms. Indeed, they have been used to manage claims brought by very large numbers of claimants. 

In Weir v Secretary of State for Transport (No1) (2005) EWHC 812 (Ch), approximately 48,000 shareholders of Railtrack brought an action against Stephen John Byers, the then-Secretary of State for Transport, in relation to his decision to force Railtrack into administration. A group of claimants formed an “action committee” that brought a single action in which the 48,000 shareholders were all parties to the proceedings.

GLOs

Parties whose claim gives rise to the GLO issues must issue a claim and be entered into the group register to be part of the GLO. There is no limit on the number of eligible claimants that may join the group, although the court may give directions that specify a cut-off date after which no claim may be added to the group register unless the court gives permission (CPR 19.13).

Representative Actions

There is no limit to the number of eligible claimants that may join a representative action. 

Representative actions are based on an opt-out regime. An opt-out action is one that is brought on behalf of those who fall within the class, unless they express their wish not to be represented. 

There is no requirement for the represented class to be joined as parties to the action, or to be identified individually. Any judgment or order made by the court is binding on all persons represented in the claim but may only be enforced by or against a person who is not a party to the claim with the permission of the court.

Collective Proceedings in the CAT

Collective proceedings can be brought on either an opt-in or opt-out basis. Historically, collective actions brought in the CAT were only conducted on an opt-in basis. However, this changed following the introduction of the CRA in October 2015, which provides for an opt-out regime. A CPO will state whether the collective proceedings are opt in or opt out and specify the time and manner by which, in the case of opt-in collective proceedings, a class member may opt in and, in the case of opt-out collective proceedings, a class member who is domiciled in the UK on the domicile date may opt out.

Parties can be added to an issued claim form, although the court’s permission is required if the claim form has been served (CPR 19.4(1)). 

See 4.4 Class Members, Size and Mechanism (Opt In/Out) which notes that there is no limit on the number of eligible claimants that may join a GLO or representative action.

For collective proceedings, an application can be made to the CAT for permission to add a party to the proceedings (Rule 38 CATR). An application for permission must be served on all the parties and may be made by an existing party or a person who wishes to become a party. Before the expiry of the relevant limitation period, the CAT may order a person to be added as a new party, if adding that party can help the CAT to resolve the matters in dispute, or if there is an issue involving the new party and an existing party that is related to the matters in dispute.

The court’s case management powers under CPR 3 are described in the responses above and apply generally to the informal group action mechanisms, GLOs and representative action procedures.   

GLOs are subject to more stringent case management by the court. In addition to the case management powers provided by CPR 3, the court is empowered to give directions, including varying the GLO issues, providing for one or more claims on the group register to proceed as test claims, and appointing the solicitor of one or more parties to be the lead solicitor for the claimants or defendants (CPR 19.13). Where the court has given directions for a claim or claims in the group register to proceed as a test claim to address a specific issue or fact or law, the outcome will be applied to the cohort of remaining claims. Should a test claim be resolved, the court may order that another claim in the group register be substituted as the test claim. 

As with GLOs, collective proceedings are subject to extensive case management. The CAT has broad case management powers and may, at any time, give directions for case management, order similar claims to be heard together, and add or substitute parties. It also has the power to strike out claims.   

The length of, and timetable for, group actions and collective proceedings brought in the court or the CAT are subject to various factors, including the number of parties, the complexity of the issues, the volume of factual and expert evidence, and the collective value of the claims. 

Although representative actions are few and far between, recent actions have lasted several years. In Jalla & Others v Shell, the Court of Appeal’s judgment was handed down in September 2021, nearly four years after the commencement of proceedings. 

GLOs have also been known to span several years. For example, the DePuy Pinnacle Metal on Metal Hip Group Litigation Order was granted on 31 July 2014 but the trial did not commence until October 2017. The trial was listed for the entire Michaelmas term (four months), with judgment handed down in May 2018.

Collective proceedings are less drawn out as the procedure is more streamlined in accordance with the CATR. Where appropriate, certain collective proceedings may be appropriate for the CAT’s fast-track procedure. Rule 58 of the CATR empowers the CAT to make an order, either on application by a party or on its own initiative, that the proceedings be subject to the fast-track procedure. In determining whether the fast-track procedure is suitable, the CAT will take into account all relevant circumstances, including:

• whether one or more of the parties is an individual or a micro, small or medium-sized enterprise;
• whether the time estimate for the main substantive hearing is three days or less;
• the complexity and novelty of the issues involved;
• whether any additional claims have been or will be made in accordance with Rule 39;
• the number of witnesses involved (including expert witnesses, if any);
• the scale and nature of the documentary evidence involved;
• whether any disclosure is required and, if so, the likely extent of such disclosure; and
• the nature of the remedy being sought and, in respect of any claim for damages, the amount of any damages claimed.

Acceleration of Claims

While the courts in England and Wales operate quickly in comparison with many other jurisdictions, litigation can span several years. In accordance with the overriding objective, the court has a duty to actively manage cases to ensure that they are dealt with expeditiously and fairly. However, in circumstances of real urgency, the court can order an expedited trial. When considering an application for an expedited trial, the court will have regard to:

• whether there is good reason to expedite a trial;
• the administration of justice;
• whether there will be unfair prejudice to the other parties; and
• any other relevant circumstances, such as whether the applicant acted quickly when conducting its claim.

The CAT provides for a fast-track procedure as described above.

Summary Disposal

The court can use its case management powers to:

• strike out a case (CPR 3.4);
• order default judgment, ie, judgment without a trial (CPR 12.1);
• order summary judgment, ie, decide a claim or a particular issue without a trial (CPR 24); or
• order a trial of a preliminary issue or issues (CPR 3.1).

The CAT has similar powers pursuant to Rules 41–43 of the CATR.

Costs

Informal group action mechanisms, GLOs and representative actions

CPR 44 sets out the rules governing costs in England and Wales. The court has discretion to award a party costs and to determine the amount of those costs and when they are to be paid (CPR 44.2). Costs may be awarded on a “standard basis”, that is, costs are recoverable only in so far as they are reasonably incurred and proportionate to the issues, or on an indemnity basis, that is, they are presumed to be reasonably incurred and proportionate. 

The general rule is that the losing party pays the costs of the successful party, in addition to bearing their own costs. Given the significant costs typically generated by group actions, this general rule has been a factor in deterring unmeritorious group actions from being pursued through the courts. 

Parties to group actions brought in the High Court after 1 April 2013 may be required to submit a costs budget. In the context of a complex group action, these can be subject to intense scrutiny by the court. In Maurice Hutson & Others v Tata Steel UK Ltd (2020) EWHC 771 (QB) which involved a GLO of more than 300 claimants, the High Court rejected an application by the claimants to retrospectively revise a previously approved costs budget and reduced a future budget by more than half. 

In addition to the general rules on costs, there are specific rules for GLOs set out in CPR 46.6. GLOs will generate individual costs, being the costs incurred in relation to an individual claim on the group register, and common costs, which comprise:

• costs incurred in relation to the GLO issues;
• individual costs incurred in a claim while it is proceeding as a test claim; and
• costs incurred by the lead legal representative in administering the group litigation. 

Generally, group litigants on the register are severally liable in respect of an order for common costs, with each litigant bearing an equal proportion of the common costs, unless the court orders otherwise. 

In addition to their share of the common costs, group litigants are also liable for the costs of their own individual, respective claims.

CAT

Like the court, the CAT has discretion as to costs and at any stage of the proceedings may make an order it considers fit in relation to payment of costs for the whole or part of the proceedings. In making such an order, and to determine the amount of costs, the CAT may take into account:

• the conduct of all the parties in relation to the proceedings;
• any schedule of incurred or estimated costs filed by the parties;
• whether a party has succeeded on part of its case, even if that party has not been wholly successful;
• any admissible offer to settle made by a party which is drawn to the CAT’s attention and which is not a “Rule 45 Offer”, to which cost consequences apply;
• whether costs were proportionately and reasonably incurred; and
• whether costs are proportionate and reasonable in amount.

Third-party litigation funders who have provided funding to losing claimants may be liable to pay significant litigation costs. In Sharp and others v Blank and others (2020) EWHC 1870 (Ch), the court ruled that the funder was jointly and severally liable for the defendants’ costs in shareholder litigation subject to a GLO and ordered it to pay GBP17 million.

Funding

There are various methods of funding available to claimants in England and Wales.

• Conditional fee agreements (CFAs) or a collective conditional fee agreement (CCFA): a party’s solicitor’s fees are payable only in circumstances agreed with the client, that is, the fee payable by the client is conditional upon agreed outcomes of the claim. If a claimant succeeds, the CFA may provide for a success fee in addition to base costs. A CFA or CCFA is usually coupled with “after the event” (ATE) insurance to cover any potential costs liability.
• “Before the event” (BTE) insurance: claims are funded through a legal expenses insurance policy purchased before an accident occurs. Many people have BTE insurance as part of their home or motor insurance policies. These policies are often used in personal injury claims.
• Damages based agreement (DBA): the representative lawyer is not paid if the claimant(s) loses their claim but may take a percentage of the damages recovered, if successful. DBAs are usually backed by a DBA or ATE insurance policy.
• Government-funded legal aid: following cost reforms which came into effect on 1 April 2013, this now has limited use in civil claims and is usually means tested. 

Third-party litigation funding

While these funding methods continue to be available to claimants bringing group actions, the emergence of third-party litigation funding (TPLF) over recent years and, in particular, the proliferation of US funders in England and Wales, has resulted in an increase in group actions being funded on this basis.

Indeed, the increased availability of such funding (and the growing presence of US law firms with class action expertise), coupled with what appears to be a cultural shift by claimants in favouring it over traditional methods of funding, can be said, among other factors, to have facilitated the proliferation of group actions brought in England and Wales in recent years. 

TPLF is self-regulated by the Association of Litigation Funders. Nevertheless, TPLF arrangements are subject to close scrutiny by the court. In the Mastercard litigation, the CAT was keen to ensure that the proceedings were to be conducted in the best interests of the class members, which should prevail over the interests of the funder, while at the same time recognising that the funder is entitled to protect its legitimate commercial interests. The CAT independently scrutinised the funding agreement, particularly in relation to provisions that permitted the funder to terminate the agreement should it consider that the proceedings were no longer commercially viable. The CAT was concerned that this put Mr Merricks at risk of his funding arrangements being terminated during the course of the proceedings and ruled that the terms of the funding agreement should include a requirement that the funders’ views had to be based on independent legal and expert advice. 

Furthermore, the CAT considered the ability of the proposed class representative to pay any adverse costs order made against it and ruled that Mr Merricks should be authorised as the class representative, providing that his litigation funders provided a suitable undertaking to Mastercard that they would discharge a liability for costs ordered against Mr Merricks. 

On 26 July 2023, the UKSC handed down its decision in the PACCAR Truck Appeal (R (on the application of PACCAR Inc and others) v Competition Appeal Tribunal and others), ruling that Litigation Funding Agreements, which allow the funder to receive a percentage of any damages award, constitute a damages-based agreement within the meaning of Section 58AA of the Courts and Legal Services Act 1990 (CSLA). Accordingly, funders will be required to comply with Section 58AA of the CSLA and the Damages-Based Agreement Regulations 2013. The judgment is expected to have significant implications for group litigation where, historically, there have been economic barriers to pursuing such actions. In particular, the impact will be felt by those pursuing collective proceedings brought in the CAT, as many of these actions are funded by third-party funders.

Disclosure

The disclosure of documents forms part of all civil claims brought in England and Wales and is governed by the rules of civil procedure. Although there are no specific or special rules governing disclosure in group or collective actions, the ordinary disclosure rules provide the court and CAT with the necessary flexibility to determine how disclosure is to be managed in group and collective actions, which are often complex in nature and involve multiple parties. 

Pre-action disclosure

The court and CAT have power to order pre-action disclosure where the applicant can demonstrate that they and the respondent are likely to be a party to subsequent proceedings and that disclosure sought extends to the documents, or classes of documents, that would have been provided by the respondent by way of standard disclosure, had the proceedings started. Standard disclosure requires a party to disclose the documents on which it relies and the documents which adversely affect its own case or another party’s case, or which support another party’s case.

The applicant must also demonstrate that the provision of pre-action disclosure will:

• dispose fairly of the anticipated proceedings;
• assist the dispute to be resolved without proceedings; or
• save costs.

Disclosure during proceedings

For informal group action mechanisms, GLOs and representative actions brought in court, once proceedings are issued, the court may make an order for either standard or specific disclosure. A party’s duty of disclosure is limited to documents which are or have been in their control. When giving standard disclosure, a party is required to conduct a reasonable search for documents, with the “reasonableness” of the search determined by the number of documents involved, the nature and complexity of the proceedings, the ease and expense of retrieval of any particular document, and the significance of any document located. 

For collective proceedings brought in the CAT, the CAT will decide at a first case management conference whether and when a disclosure report and Electronic Documents Questionnaire should be filed. At a subsequent case management conference, the CAT will decide what orders to make for disclosure, having regard to the need to limit disclosure to that which is necessary to deal with the case justly. At any point, the CAT may give directions as to how disclosure should be given, including the nature of the searches to be undertaken, whether lists of documents are required, the format in which the documents are to be disclosed, and whether disclosure is to take place in stages. 

Although the rules governing disclosure in the court and CAT are similar, their application varies between the different regimes. For example, since the represented class in a representative action is not party to the proceedings, the members of the class are regarded as third parties for the purposes of disclosure. Accordingly, the represented class is not subject to the usual standards of disclosure and will be subject to the specific requirements governing disclosure by third parties (CPR 31.17).

The CAT has the power to order disclosure to be given by any party to the proceedings – the class representative and any represented person to any other represented person (including a person within a different sub-class), the class representative or the defendant – on any terms it deems fit.

Privilege

There are no special or specific rules governing privilege in group or collective action proceedings so the standard rules governing privilege apply. 

Parties can withhold documents from inspection on grounds of legal professional privilege. This comprises:

• legal advice privilege, which applies to confidential communications between a client and their lawyer where such communications came into existence for the purpose of giving or receiving legal advice; and
• litigation privilege, which applies to confidential communications or documents created by a client and/or their lawyer in reasonable contemplation of litigation.

Parties may disclose a privileged document to a co-party or a third party on grounds of “common interest privilege” where the co-party or third party has a common interest in the claim.

Parties can also withhold “without prejudice” communications which were produced as part of a genuine attempt to resolve issues in dispute.

The types of remedies and relief available will depend on the type of action brought, as well as the basis of the claim. 

Broadly, the following remedies are available to claimants in all aforementioned group action regimes brought in England and Wales, save as noted below.

• For tortious claims, the law aims to restore a claimant to the position they would have been in had the tort not occurred. Compensatory damages may be awarded by the court. Punitive damages are permitted but are rarely awarded and are usually restricted to cases of deliberate torts, such as where a defendant has calculated that the financial gain from the wrongdoing is likely to exceed any damages payable to a claimant. In actions involving multiple defendants, liability for the same damage can be joint and several. 
• For contractual claims, the law aims to restore a claimant to the position they would have been in had the contract been properly performed. The remedies available will depend on the contractual term breached. A claimant may be compensated for financial losses arising from the breach. A claimant may also seek an order for specific performance of the contractual terms to be carried out by the defendant.
• Interim relief, including specific disclosure, interim payments and injunctions, are at the discretion of the court, which will have regard to the overriding objective of dealing with cases justly and at a proportionate cost.
• Declaratory relief may be granted by the court as a sole remedy or in conjunction with another remedy such as damages.

Remedies – Application to Group Action Regimes

Representative actions

In Lloyd v Google (2021), the UKSC held that the potential for claiming damages in a representative action is limited by the nature of the remedy of damages at common law, that is, to put the individual claimant in the same position as if the wrong had not occurred. As this requires an individual assessment of loss and damage that raises no common issue and cannot be carried out without the participation in the proceedings of the individuals concerned, the representative action procedure is not the correct mechanism for bringing such claims. 

GLOs

Although a GLO may address common issues of fact or law relating to the losses claimed by the claimants, damages are calculated on an individual basis for each claimant. Damages are not awarded on a combined basis, nor are they aggregated.

CAT

Damages can be awarded on an aggregate basis, either by way of a lump sum or by reference to a formula to determine the sum due to each claimant, without requiring individual claimants to prove their losses. Punitive damages may not be awarded in collective proceedings. The CAT does not have jurisdiction to grant declaratory relief.

There is no cap on the level of damages awarded by the court in any of the above group action mechanisms.

ADR

As for all civil cases, ADR is available for all types of group actions. Forms of ADR may include mediation or informal without-prejudice round table meetings between the class representatives and defendants.

During the course of proceedings, parties are encouraged to consider the possibility of ADR and settlement. The overriding objective (CPR 1) provides that the court must actively manage cases by encouraging parties to use an ADR procedure if the court considers this appropriate, and facilitating the use of such procedure. 

The CPR Practice Direction on Pre-action Conduct and Protocols also states that before commencing proceedings, the court will expect the parties to have exchanged sufficient information to understand each other’s position, to try to settle the issues without proceedings, consider a form of ADR to assist with settlement and reduce the costs of resolving the dispute. Litigation should be a last resort.

Where appropriate, the court may order that the parties take steps to engage in ADR. A party may risk adverse costs consequences for unreasonably refusing to engage in ADR. 

While the CATR do not expressly provide that the class representative or class members engage in pre-action ADR, they state that the CAT may encourage and facilitate the use of an ADR procedure if it considers it appropriate to do so. Furthermore, the CATR provide that:

• when determining whether claims are suitable to be brought in collective proceedings as part of the certification process, the CAT will take into account the availability of ADR and any other means of resolving the dispute, including the availability of redress through voluntary schemes;
• on the commencement of proceedings, the collective proceedings claim form requires the parties to state whether they have used an ADR procedure (rule 75(1)(g)); and 
• at a case management conference, the CAT may give directions as to a stay of proceedings while the parties attempt to compromise the proceedings by ADR or other means.

Settlement

Settlement of claims subject to a GLO and representative actions is no different to settlement in ordinary, individual civil claims brought in the court. Generally, the CPR contains no express provisions or guidance in relation to the management of settlements or settlement agreements.

To the contrary, the CA98 contains express provisions governing settlement in both opt-in and opt-out collective proceedings brought in the CAT.

• In opt-in collective proceedings, if the class representative is a member of the class and settles, in whole or part, its personal claim included within the collective proceedings, it is required to promptly give notice of the fact of settlement to all represented persons and the CAT. The CAT is not required to approve the settlement.
• For opt-out claims, the rules are more stringent in that collective settlements may only be settled by a collective settlement approval order issued by the CAT. The CAT will only make such an order if it considers the terms to be “just and reasonable” (CATR 94(8)) by having regard to all relevant circumstances, including the amount and terms of the settlement, the number or estimated number of persons likely to be entitled to a share of the settlement and the opinion of any independent expert and any legal representative of the applicants. 
• The approved settlement will bind all represented persons, except persons who have opted out by a time specified in the collective settlement approval order, and persons who are not domiciled in the UK at a specified time and have not opted in to the collective settlement by the time specified in the collective settlement approval order.

A judgment issued by the court in an informally managed group action will be binding on all named parties to the proceedings.

A judgment issued by the court in respect of a GLO issue will be binding on all other claims on the group register, unless otherwise ordered by the court. A claimant who was entered on the group register post-judgment may apply to the court for an order that the judgment is not binding on them. The court may also give directions as to the extent to which a judgment or order is binding on parties to any claim that is subsequently added to the group register. Parties have the power under CPR 19.12(3) to appeal any judgment or order if they consider that they are adversely affected by it.

Similarly, unless the court directs otherwise, any judgment given in a representative action is binding on all persons represented in the claim, but it may only be enforced by or against a person who is not a party to the claim with the permission of the court (CPR 19.6(4)). 

A judgment made by the CAT in collective proceedings may specify the sub-class of represented persons or individual represented persons to whom it does not apply. The class represented is required to give notice of any judgment to all represented persons in a manner approved by the CAT.

There are growing calls from claimant law firms and consumer action groups for a generic opt-out class action regime beyond the scope of competition law claims in the CAT. However, in light of the developments noted in 5.2 Legislative Reform, these calls are likely to go unanswered in the short term.

Nevertheless, there has been a marked increase in group actions in recent years and an apparent willingness on the part of the courts to approve such actions, including those pursued by foreign claimants seeking redress from UK parents companies in respect of the actions of their foreign subsidiaries. An example is the recent decision of the Court of Appeal in Municipio de Mariana v BHP Group UK Ltd (formerly BHP Group Plc) & another (2022) EWCA Civ 951, in which the court granted permission for more than 200,000 Brazilian claimants to proceed with their claims against the defendant UK parent company arising from the catastrophic collapse of the Fundão Dam in South-East Brazil.

On 20 July 2021, the Department of Business, Energy and Industrial Strategy (BEIS) published a consultation, “Reforming competition and consumer policy”, to assess, among other things, whether there is a case for strengthening the UK’s collective redress regime. However, as noted in the government’s response published in April 2022, given the differing perspectives presented during the consultation, the government does not intend to take any action in relation to the UK’s collective redress regime, save for extending the CAT’s jurisdiction to grant declaratory relief.

As a result of Brexit, the UK will not be required to implement the Directive of the European Parliament and of the Council on representative actions for the protection of the collective interests of consumers (2020/1828) into UK national law. 

Nevertheless, it is clear that the UK is following in the same direction of travel as the EU, as there has been a marked increase in group actions in recent years, as well as a drive towards widening the scope of opt-out actions in the UK.

Concerns around ESG and increasing compliance requirements attached to these issues have resulted in the commencement of a number of collective redress actions as investors, consumers, and activists continue to scrutinise the actions companies are taking to address climate change, tackle human rights abuse and improve environmental compliance.

Environment-Related Claims

Cases against UK-headquartered companies with foreign subsidiaries

In particular, there has been a surge in environment-related claims. There have been several cases brought in the English courts against UK-based companies with subsidiaries operating in foreign jurisdictions. The claimants in Lungowe and others v Vedanta Resources plc and another (2019) UKSC 20 and Okpabi and others v Royal Dutch Shell plc and another (2021) UKSC 3 both sought to recover damages from UK-based parent companies, alleging environmental violations by its subsidiaries abroad. The UK Supreme Court provided useful guidance in Lungowe as to when parent companies will be held responsible for breaches by overseas subsidiaries. It confirmed that responsibility would largely be determined by the extent to which the parent company was involved in the control, supervision and management of operations of the subsidiary. Responsibility would also be assumed where a parent company publicly demonstrated involvement. Okpabi followed this reasoning; the extent of Shell’s duty of care here was determined by how its corporate structure operated in practice.

In Mariana and others v BHP plc and BHP Ltd (2022) EWCA Civ 951, the Court of Appeal delivered a long-awaited judgment, permitting 202,600 claimants to proceed in their group action claim against BHP, an international mining company, regarding the collapse of the Fundão dam in Brazil in 2015. The decision anticipates that UK-headquartered companies may increasingly find themselves the subject of group litigation in England and Wales due to the actions of their overseas subsidiaries, particularly as greenwashing and environmental damage become fertile areas for claimants and claimant law firms to bring about class actions.

Cases against UK water companies

In the UK, an environmental collective action was launched in 2023 at the CAT against Severn Trent Water and is due to be followed by five others against UK water companies on behalf of 20 million customers. This opt-out, standalone competition damages claim alleges that several water and waste management companies in England have unlawfully discharged wastewater and untreated sewage into waterways and have failed to comply with their obligations to report these incidents. The CAT’s handling of this environmental class action will be pivotal in determining the outcome of similar claims in the near future.

US influence

The trend for ESG litigation is expected to continue on an upward trajectory in light of experienced US class action law firms and third-party litigation funders having entered the UK market in recent years.