Cooper: Fairer and more efficient
The High Court has overturned a ruling that 5,823 people with motor finance commission claims have to file individual claims, rather than sue via eight omnibus claim forms.
The decision of Mr Justice Ritchie is likely to encourage more law firms to pursue claims actions against finance companies, according to the solicitors who won the ruling, Barings Law in Manchester.
It could also “steer major finance companies such as Black Horse, BMW Financial Services, and Volkswagen Financial Services towards early settlements”.
Ritchie J said: “The omnibus route would favour access to justice for those claimants with small claims track and fast track claims. There is an imbalance of financial power between individual claimants and the defendants.”
Even though defendants might in theory have to pay more in claimant legal costs through the omnibus route, given that many individual claims would be on the small claims track, they “may save costs overall due to the increased prospects of settling following cases once lead cases are tried”.
Barings Law initially issued the omnibus claim forms against eight different finance providers in November 2022. However, a year later, His Honour Judge Worster in Birmingham ordered that each claimant must issue a separate claim form within three months or be struck out.
He had already given permission to appeal and Ritchie J heard it in Birmingham last month. By then, the test HHJ Worster had applied, from the Divisional Court decision in Abbott earlier in 2023, had been overturned by the Court of Appeal last April in Morris.
This meant HHJ Worster’s decision was wrong and on its own was enough to allow the appeal.
Ritchie J also held that the judge was wrong to decide that the common issues determined in lead cases could not bind other claimants and that they would in any case only have an insignificant or limited impact on other cases.
Ritchie J continued: “I consider that omnibus disposal will assist in the appropriate choice of lead cases to determine the common broad and specific issues (to be determined later). Separate claims would make choosing lead cases less likely (or not likely at all as the judge envisaged it) and so random early trials would occur instead of lead case early trials.
“The significance of the lead case decisions would at least be persuasive. Choice of lead cases would lead to a greater likelihood of solving the main issues early and so settling following cases than random determination of early cases.
“Omnibus case management would be capable of enforcing issue estoppel on the parties for specific common issues which would be significant.”
Barings argued that issuing eight claims saved issuing fees for the other 5,815 claims and collective case management would save legal fees and court time.
Ritchie J agreed, citing the number of claimants, and the fact the claims related to the same or similar matters, and all contained the same cause of action – separate disposal “would lead to conflicting decisions”, he said. Omnibus claims would also likely require fewer judge hours.
He remitted the case to HHJ Worcester for case management under the omnibus claim forms.
Craig Cooper, managing director of Barings Law, said the omnibus approach would make access to justice “fairer and more efficient for everyone involved”.
The original decision “would have placed an enormous burden on both claimants and the courts, making legal action impractical for many”.
Ritchie J’s decision came in the wake of another circuit judge in Birmingham refusing to make a group litigation order in relation to thousands of Plevin claims. Her Honour Judge Emma Kelly also found the use of omnibus claim forms to be inappropriate. Ritchie J noted this ruling in his decision.
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