Class Actions: Are We Moving Towards an Opt–out Regime?

Abstract

Summary There appears to be a growing momentum toward the introduction of an “opt–out” regime for pursuing litigation on behalf of a number of parties who share similar grievances: so–called “class actions”. A Research Paper by Professor Rachael Mulheron,which was commissioned by the Civil Justice Council (CJC) and published on 8 February 2008, has concluded that: (a) there is a need for reform of collective redress mechanisms in English civil procedure; and (b) this need should be filled by the introduction of an “opt–out” regime, whereby an action can be pursued on behalf of a class of unnamed, or even unidentified, claimants who are deemed included in the action unless they have specifically opted out. The Paper has however consciously avoided consideration of either: (i) the actual design of such a regime; and (ii) importantly, how litigation conducted pursuant to such a regime should be funded and how costs should be dealt with, including to what extent the current costs shifting rules should be retained. The CJC commissioned the Paper as part of its investigation into whether initiatives should be proposed to improve collective redress mechanisms. The CJC is expected to make recommendations to the Ministry of Justice on this matter during 2008.