Nothing but Positive News for Consumers in Scotland

Beginning with August 2020 consumers in Scotland will have the opportunity to bring group proceedings at the Court of Session. An Act of Sederunt was passed by the Court of Session, in approving the corresponding draft submitted by the Scottish Civil Justice Council. It brings amendments to the Rules of the Court of Session 1994 under the provisions in Part 4 on Group Proceedings Civil Litigation (Expenses and Group Proceedings) (Scotland) Act 2018.

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Breviter

This SSI[1] aims to implement the rules found in Part 4 of the 2018 Act. Part 1 contains general provisions on interpretation and application, whereas in Part 2 to Part 4 we find provisions on representation, permission to bring group proceedings, and introduce a new “opt-in model” for such proceedings.

One, or more individuals, can apply via a motion to act as a representative party in connection with the same issue which may be subject to group proceedings. Lord Ordinary shall then determine suitability to represent based on several factors set out in Section 26A.7 (2). Equally, it is within his discretionary power to refuse an application where the criteria set in the provision are not satisfied. Nonetheless, once granted, the authorisation to represent lasts until the proceedings are concluded, if permission is withdrawn. Similarly, a representative party or a member of the group I question can apply to court via a motion to seek permission from the Lord Ordinary to replace the representative party.

Similarly, permission to bring group proceedings is to be sought through a motion served to the Lord Ordinary by the applicant or the representative party. If satisfied, the Lord Ordinary will make an order granting permission for group proceedings, or he may ask for further information to be provided in the interim, and fix a further date and time for the hearing of the application for permission. Appeals against both the award and/or refusal of permission are allowed by submitting a reclaiming motion.

Part 4 makes provision for the opt-in procedure. Following this model, the court proceedings and outcomes, both negative and positive, are said to extend and benefited only to those parties who have adhered to the action. Hence, those who wish to be part of the group proceedings, or conversely wish to withdraw their consent to participation, can do so via a notice of the representative party. All of those who are participating in the action will be counted in a group register lodged in the General Department by the representative party.

Subsequently, Parts 5 to 10 contain detailed provisions on procedural matters. Part 7 sets out the provisions on the procedure. Particularly, the rules with regards to preliminary hearing and case management hearing. With respect to the debates, per S26A.23.(1) a party intending to proceed to this stage must submit an application stating the legal argument on which preliminary pleas are to be sustained or repelled including all relevant statutory and case authorities on which the argument is based. Before consenting, the Lord Ordinary shall call upon the parties to address the possibility of reaching an agreement on the matters in question. When that fails, the action is to be appointed to debate.

Finally, Part 10 contains provisions regarding settlements. It places a statutory duty on the representative party and establishes that those acting as a presentative party must, before any distribution of damages, consult all the group members on the terms of a proposed settlement.

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Summatim

The rules on group proceedings will come into force on July the 31st, 2020, only a few months following the enactment of the Consumer Scotland Act 2020. Arguably, these recent rules will boost confidence among consumers in Scotland; they aim to better consumer protection and further advance consumer rights and interest in Scotland through the established of a new agency that shall oversee that merchants and service providers act in their best interest, but also by allowing those who have had their rights infringed upon to bring proceedings against businesses by joining their powers and create leverage acting in their favour.

Lord Carloway, the Lord President and chair of the Scottish Civil Justice Council, saluted the work of the Council and stated that the clarity and flexibility of the rules will prove utile for those consumers who will want to raise actions against businesses by way of this new civil procedure. The cost-effectiveness of ‘class actions’ have a positive track record in other jurisdictions and are considered instrumental to those seeking to access and bring about justice. It is hoped that they will be equally utilised by Scottish consumers in their attempt to seek compensation for any abuse of their rights in their procurement of goods and services in Scotland.

The Act of Sederunt (Rules of the Court of Session 1994 Amendment) (Group Proceedings) 2020 could truly mark the beginning of an era of class action litigation in Scotland.

[1] Scottish Statutory Instrument