New ‘class action’ regime will help consumers

Government plans to introduce a new regime for ‘class actions’ will enhance access to justice for consumers who have suffered because of anti-competitive behaviour, the Law Society said today.
The planned changes will see the introduction of ‘opt-out’ collective actions, which means a legal action can be brought on behalf of all affected individuals, for example by a consumer body in relation to price fixing scandals.
Collective actions enable access to justice for individuals who would not otherwise be able to afford the legal fees.
The new regime will replace the existing ‘opt-in’ rule, whereby a body bringing a class action case has to get all affected individuals or consumers to join the action.
The change will benefit consumers, who, in future, will need to actively ‘opt out’ if they want to bring their own, separate case against a defendant. But this in turn will make the cases easier to bring for organisations like consumer bodies.
Responding to the proposals, Law Society President Lucy Scott-Moncrieff said the Government have proposed a position very close to the Law Society’s across most of the issues.
“We responded to the consultation on this last summer and we are very pleased with the key changes proposed, particularly the introduction of opt-out collective actions and the expanded role for the Competition Appeal Tribunal. The current system simply isn’t working.”
She added, “It’s disappointing that some kinds of fee agreements will not be available for these actions. Similarly, it’s a shame that law firms will not be able to bring opt-out actions themselves to help prevent anti-competitive behaviour. We supported the suggestion which would have permitted law firms to be certified by the courts with proper safeguards to ensure there was a genuine interest in bringing a case, but the Government decided against this.
“However, it is good news that further access to justice for the public will be supported by the fact that any compensation that has been awarded to affected individuals in a successful collective action but not claimed, will be paid to the Access to Justice Foundation, an independent charity.”
1 Feb 2013
Law Society, London

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