Unit 3 AOS 2 Civil law - 3.2.9 Class Actions Flashcards
Define a class action
A group of 7 or more people that share a similiar claim against the same defendant/party
Lead plaintiff and group members
One person is allocated as the lead plaintiff, and will have their name on the case and bring the claim forward
Everyone else is known as a group member, and do not participate as much
Group members
Do not have to:
contribute to legal fees
play an active role
pay for a adverse cost order
participate in pre-trial proceudres
3 Different ways a class action can be funded
- Through the lead plaintiff
- Through a law firm
- Through a litigation funder
Funding through the lead plaintiff
The lead plaintiff will fund the legal proceedings, and they alone will be responsible for the adverse cost orders and other costs if the case if unsuccessful
Funding through a law firm
Law firms will generally offer a no-win-no-fee basis
If the class action wins, a large portion of the remedies awarded are given to law firms
The court decides what percentage of damages go to the law firm
Funding through a litigation funder
A private organisation that will pay all the costs
Take up to 40-45% of the damages awarded
If the class action is unsuccessful, they will have the financial burden
5 Factors to consider if a class action is appropriate
- 7 or more people
- Someone is prepared to take the role of a lead plaintiff
- Nature and size of the claim
- Whether a group member has suffered significantly more than others
- Whether a law firm, litigation funder of lead plaintiff is prepared to fund the civil claims
Class Actions under $1 million of damages are less likely to attract funds
Class Actions over $5 million in damages are more likely to attract funds
Strength of Class Action: Increase Access
More people can engage in the civil justic system if they do not have to pay for the litigation funds
Group members aren;t responsible for costs but still have access to damages
Cost-effective strength increases access
Weakness of Class Actions: Access (lead plaintiff)
If the lead plaintiff is funding the claim, they may face significant financial losses if the claim is not successful
Barrier of costs reduces the ability of class actions to commence if a person is not prepared to have the burden of costs, limiting access`
Strength of class actions: Efficiency
Class actoins handle numerous civil claims through a single lawsuit
Saves court time and resourecs, increases access for other people
Weakness of Class actions: Resource - intensive
Class actions can be resource intensive
Require significant court times
increases delays and reduces access
Strength of class actions: Financial supports
Litigation funders and law firms remove the financial risk
Encourages more people to pariticpate in the civil justice system
Increases fairness
Weakness of class actions: Litigation and law firms portions
Litigation and law firms take large percentages of the total awarded amount
Reduces the number of damages of group memebrs
Does not reflect actual losses, no adequate measures to ensure members are compensated
limits equality
