Amid concerns that the existing collective action mechanisms in the UK restrict access to justice, with the consequence that meritorious claims are not being pursued, the Civil Justice Council (CJC) published a report in December 2008 proposing a generic collective right of action. The proposed right of action mirrors the existing UK mechanisms which allow claimants to "opt in" but would also allow claimants to "opt out" (along the lines of the US class action system).
On 20 July 2009 the Government responded to the CJC's report stating that a generic collective right of action would not be appropriate in the UK. It suggested that more extensive collective rights should only be introduced in certain sectors: those where government departments believe that they are the most cost effective way of increasing access to justice. The Government's response favoured a hybrid model where claimants can opt in at any time before a decision is reached on liability or before damages are quantified. Anyone who failed to opt in would still be able to bring their own action later.
This proposal is likely to mean potential defendants will face an increased number of claims. Better news for defendants is that the Government recognised the importance of a strict certification process for any collective action procedure whereby the court would have to approve each collective action in light of the legal merit of the claim and the likelihood that the defendant will be able to recover its costs should the claim be unsuccessful. The Government did agree with the CJC as regards the application of the usual "cost-shifting" principle ie that the losing party to the litigation should pay the winning party's costs;it suggested that this principle was a safeguard against unmeritorious claims.
The Government is to prepare a framework document later this year detailing the issues to be addressed by policy makers which we will report on in due course.