A recent Court of Appeal decision sheds light on how the court will determine the effect of a decision in a test case on other claims pursued under a group litigation order (GLO): Axa Sun Life Plc v Commissioners of Inland Revenue [2024] EWCA Civ 1430.
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 allow for the efficient case management of claims which give rise to common or related issues of fact or law, known as the GLO issues. Under the relevant court rules, a judgment or order in relation to a GLO issue is binding on the parties to all other claims on the group register at the time, unless the court orders otherwise (CPR 19.23(1)(a)). Those parties may, however, apply for permission to appeal against the order (CPR 19.23(2)).
Where GLO issues are decided by reference to test cases, it can sometimes be less than straightforward to determine the impact of the court's findings on the other claims in the GLO. The Court of Appeal in this case held that the court's order on a GLO issue as to limitation was fact specific to the test claims and could not properly be interpreted as applying to all other claims on the group register. As the court commented, this case underlines the need to define GLO issues "with precision and in a way that means that they can be answered as GLO issues".
The decision also considers when it might be appropriate to order that a judgment or order on a GLO issue, which would otherwise bind all parties, should not do so. The Court of Appeal noted that in some cases it may be apparent that the facts or circumstances of different claims on the group register may warrant a different approach. Where, however, the issue in question is one of pure law, so that factual differences are not relevant, the court may "order otherwise" if there are special circumstances that would create injustice if the order were binding on all claimants. It emphasised, however, that in most cases parties to group litigation should expect to be bound by decisions on GLO issues.
For more information on this decision, please see our Litigation Notes blog.
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