Effective 4 December 2015 Thailand’s Civil Procedure Code will (*the civil procedure had already amended and it announced on the official gazette on 7 April 2015) include class-action lawsuit provisions previously not permitted under Thailand’s legal regime. A class action is a type of lawsuit in which one or a collective group of individuals sue a defendant on behalf of a larger group of persons (hence the “class” in class-action). Section 222/8 of the Civil Procedure Code will be Thailand’s first attempt at including class action lawsuits in its civil and commercial code. It is worth understanding how class actions work how they can be beneficial and what the introduction of this new law will have on business operators in Thailand.
Common Elements in All Class Action Lawsuits:
The subject matter of class action law suits generally relate to topics which involve a certain degree of “public interest” whereby a “class” can be created. While the subject matter of class action lawsuits can vary, there are two common elements present in every class action lawsuit (across all jurisdictions where such laws exist). The two issues include:
- Dispute issues are common to all members of a class; and
- Persons affected are so large in number, such that it would be impractical (and a waste of the Court’s time) for each person to bring a separate lawsuit.
What are some good examples of class actions?
- Consumers harmed by defective products (e.g. a car model with an inherent manufacturing defect);
- Homeowners affected by environmental development projects such as dams and factories;
- A group of employees being subjected to racial, age, or gender discrimination by their employers.
The inclusion of class action legislation would introduce positive developments in the Thai judiciary, such as:
- Increases in the efficiency of courts dealing with actions as a group rather the individuals;
- Allow the filing of “good” lawsuits where the individual cost of litigation would be too high;
- Lowers individual costs (similar to No.2, the cost of litigation is shared amongst the “class”);
- Provides a degree of certainty to plaintiffs and defendants, once the class action lawsuit has entered judgment, the issue would not be heard again. It also provides certainty that individual actions may result in varying rewards;
- Provides for alternative methods of regulation outside standard governmental regulatory regimes.
While class action litigation is generally understood to be advantageous to the court process, it is subject to criticism because of the limited monetary rewards resulting from a judgment.
- If a judgment is made in favor of the class action, class members receive minimal awards, as the payout is distributed among the class.. Thus individuals may be likely to receive higher awards if they were to bring action as an individual rather than part of a class.
- As Thailand does not have a jury system, it is expected that class action awards will be highly predictable and limited in monetary value;
- High legal fees.
Thailand’s introduction of class action laws is a welcome inclusion into Thai jurisprudence, but what effect will such laws have on individual businesses?
While at this early stage it is unknown what the precise impact of the amended law . Though, the scope of a class action law’s impact can only be determined after testing in the courts, there are businesses which may be at a higher risk after the passage of this law.
This higher risk means that such businesses will also be subject to higher insurance premiums. Smaller businesses are at greater risk for increases in insurance premiums. Unlike bigger corporations, small businesses may not have the luxury of in-house counsel to handle class-actions. As such, higher costs will be involved in engaging outside counsel who would be better suited in terms of experience and expertise. However, businesses currently operating in sales will not be subject to higher risks.
Commentators have argued, that the introduction of class action law in Thailand will decrease Thailand’s attractiveness as a business destination and impact future foreign investments. As class action laws exist all over the world, many companies have acclimated to the concept as well as the risks behind establishing operations in a country with class action law.
How to Bring a Class Action Lawsuit in Thailand (a step by step guide):
Thailand’s class action legislation includes elements mentioned above though it will vary from other U.S. and Common Law class action legislation. Numerous international statutes permit class actions to brought in regard to any subject matter, Thailand has decided to limit its focus on tortious claims (negligence etc.), breach of contracts and regard to “claims of legal rights” (which are laws generally passed to protect the public (i.e./such as environmental law, consumer protection, labor, securities and exchange and trade competition laws). The first step is to find a “class” of individuals and then, determine whether the courts will permit a class action in relation to such an action.
Which Court do I bring my potential class action to?
If you have decided that a class action law suit is appropriate for you and your group’s claims,(and you have established that the courts will be willing to hear on the issue) the next stage is to approach the courts. But which Court?
The jurisdiction for class actions is subject to the Court which is empowered to hear an individual on the same matter *except municipal court (kwaeng court).The class actions involve with specific matters such as the administrative decisions, the labor dispute and trade protection dispute shall be brought to the specific courts (i.e. the Administrative Court, Labour court and the Intellectual Property and International Trade Court).
The Pre-Class Action Phase:
Before proceeding with legal action, the class of plaintiffs, who have now determined which Court to proceed under, must demonstrate to the Court that there exists a “group of people” who carry common rights, facts and base their legal claims on common ground (despite their “injury” varying from person to person). The second point demonstrated to a Court under Section 222/8 of the Civil Procedure Code is that bringing individual actions (as opposed to actions brought as a class) would be “troublesome and inconvenient” and that bringing the action as a class of individuals will result in “better justice and efficiency”. Subject to these conditions, the Court consider whether the class action should be heard.
While there may be instances where the court prevents the class action from moving forward, the Civil Procedure Code states that an interlocutory appeal can be filed to ensure that the class’ facts are heard thoroughly.
Obtained Certification, Now What?
Once the “pre-class action phase” is successfully completed y and the class action has been certified by the court, the next stage is to submit to the court the plaintiffs desired remedy.. The Court, prior to the trial, will appoint a “class action office” (sometimes referred to as an “executing officer”) whose job involves assisting the Court by attempting mediation, collecting and verifying evidence, meeting with witnesses and taking statements before and during the trial.
During this phase, if “class members” decide that the class action remedy does not best suit their needs, they have a period of forty-five days to withdraw from the “class”. It is not uncommon for individuals to withdraw from a “class” following a few rounds of mediation between the parties.
Before the trial, it is required that notification be provided to the public that a class action lawsuit is taking place and any individuals (with the same facts and grievances) may apply to be a part of the lawsuit. Notification is expected to be provided in a public newspaper for a period of 3 days. The court may, in its discretion, permit such notice to be distributed via mass media or in any other form deemed appropriate by the court.
Obtaining a Judgment:
Congratulations, you and your “class” have made it this far. From a procedural standpoint, the trial portion of class actions are not very different from ordinary civil actions. You can expect the same process of mediation, submission of evidence, hearing of witnesses and finally a delivery of judgment.
If the court decides in the favor of the “class” of plaintiffs, then a judgment will include the class’ lawyer fees along with the payment of damages to all class members individually (based on the formula submitted to the Courts). Section 222/37 authorizes the court can consider and prescribe percentage of total monetary awards up to 30% as the attorney fee.