There has been a considerable amount of political and media discussion recently on the topic of multi-party or class actions and whether Ireland should introduce procedures to allow for such actions.
On 9 November 2017, Sinn Fein TDs, Donnchadh Ó'Laoghaire and Pearse Doherty introduced the Multi-Party Actions Bill 2017 in the Dáil. In doing so, they argued that the primary benefit of the Bill would be to reduce the cost of litigation, make better use of court resources, and improve access to justice.
The Bill is heavily grounded in the recommendations of the Law Reform Commission paper on multi-party litigation from 2005.
Multi-Party Actions Bill 2017
The Bill provides that proceedings which involve multiple parties, whether as plaintiffs or defendants, and which give rise to common or related issues of fact or law can be certified as a multi-party action by the Court.
A party must first consult with the Courts Service to see whether a previously certified multi-party action is relevant. If not, they may bring a motion seeking certification. The President of the High Court will nominate a Judge who will deal with the certification application and if the proceedings are certified, that Judge will deal with all subsequent matters arising in the multi-party action.
In deciding whether or not to certify, the Judge must consider whether it is likely that there will be multiple cases giving rise to multi-party action issues and if the procedure offers an appropriate, fair and efficient process for the resolution of multi-party action issues.
If the proceedings are certified, the Judge will make an order establishing a Register and setting out the issues which are likely to arise. The Judge will also set out the criteria for entry on the Register and specify a date after which parties may not be added to the Register. The Judge may also give directions on publicising the multi-party action order.
To join the Register for a multi-party action, a party will have to issue proceedings and apply to the nominated Judge to be entered on the Register.
The parties to a multi-party action shall endeavour to agree on the appointment of a lead solicitor for the action but if there is no agreement (or if the Judge fails to approve the agreed lead solicitor) the Judge shall appoint a lead solicitor following submissions from the parties. More than one lead solicitor can be appointed.
The costs of the multi-party action will be divided equally among the members of the Register who shall be jointly and severally liable for costs.
The TDs presenting the Bill have encouraged all parties to support the legislation and have noted that the principles in the Bill have been supported publicly in comments by members of Fianna Fáil and Labour. However, it is not yet clear what the Government's stance will be or whether the Bill will, in fact, be supported by the other political parties.
There are some issues with the Bill that will require clarification, namely:
The Bill seems to envisage that all multi-party actions will be brought in the High Court irrespective of their individual value. The question arises as to whether it would be better to have a multi-action procedure in each of the different courts to cater for claims of all sizes and ensure proportionate costs orders are made.
What will happen where there are related cases being taken outside the multi-party action? Is there a risk of duplication of costs or conflicting decisions?
Who will bear the costs of the application for appointment of the lead solicitor? Is it appropriate that the costs of this application should be costs in the proceedings?
In a speech in October 2017 the Chief Justice indicated that the Government should consider adopting a practice of auditing new legislation to ascertain the resources implication for the courts. Given the current issues facing the courts due to a lack of resources, such an audit of the Multi-Party Action Bill would be most welcome.
For further information, please contact Paula Mullooly or your usual contact in A&L Goodbody.