A recent High Court decision illustrates the complexities that can arise in determining the effect a decision in a test case will have on all the other claims pursued under a group litigation order (GLO): Axa Sun Life Plc v Commissioners of Inland Revenue [2023] EWHC 944 (Ch).
The case will be of particular interest to financial institutions following developments in securities class actions, and collective proceedings more generally.
The purpose of a GLO is to enable the court to determine the common or related issues that arise in multiple similar claims, known as the “GLO issues”, more efficiently and cost effectively than if the claims were dealt with individually. With that aim in mind, CPR 19.23 (formerly 19.12) provides that where a GLO has been made, a judgment or order in a claim on the group register in relation to one or more GLO issues is binding on the parties to all other claims on the group register at that time, unless the court orders otherwise.
However, where the court determines GLO issues through the use of sample or test cases, it is not always straightforward to discern precisely what impact the court’s decision will have on the other claims under the GLO. A distinction may be drawn for these purposes between issues which are truly common, in the sense that they apply in precisely the same way to all the claims – eg whether a product supplied by the defendant was defective – and those which are common or related in a looser sense. A classic example in this latter category is limitation, as it is often included among the GLO issues but its determination will often vary at least to some extent by reference to individual circumstances.
The decision in the present case underlines the importance of ensuring that the GLO issues are properly and adequately defined, before the court tries any test claims, so that it is clear what the judge is deciding and disputes do not later arise as to the broader impact.
For more information on this decision, please see our Litigation Notes blog.
Note: In July 2023, the claimant applied to the Court of Appeal for permission to appeal.
In October 2023, the Court of Appeal allowed the claimant's application for permission to appeal. The hearing is fixed for 15 October 2024.
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