Called out: Le Patourel v BT rulings offer key guidance for the opt-out regime
Two recent rulings in Mr Le Patourel’s collective action against BT - the first from the Court of Appeal dismissing BT’s appeal against certification and the second from the Tribunal following the subsequent CMC - provide important guidance for the development of the opt-out collective regime and are a further shot in the arm for existing and would-be claimants.
No general preference for opt-in proceedings
Earlier this month, the Court of Appeal rejected BT’s appeal against the certification of Mr Le Patourel’s claim on an opt-out basis, holding – significantly – that, despite the content of the Guide which states a general preference for opt-in proceedings, there is no general preference for opt-in collective proceedings over opt-out. Neither section 47B of the Competition Act 1998 nor the Tribunal’s Rules provide a policy basis to support a preference or predisposition for or against either opt-in or opt-out, the Court held, and the legislative starting point is thus properly one of neutrality. In this respect, the Court of Appeal noted that the Guide ought to be reconsidered.
In that context, the Court held that the assessment which the CAT ought to perform when evaluating the opt-in/opt-out question is a multi-factorial, balancing exercise and one which is able to take into account all the circumstances of a claim. In particular, the CAT is entitled to consider that:
- the size of a class may be limited should an opt-in action be favoured; and
- a claim may not be viable from the point of view of a litigation funder if reformulated on an opt-in basis.
The “strength of the claims” and “practicability” of the case proceeding on an opt-in basis, factors cited at Rule 79(3)(a) and (b) respectively, form part of the Tribunal’s balancing exercise but:
- the “strength of the claims” should not be interpreted such as to create an additional hurdle going to merits for opt-out claims; and
- “practicability” means more than just “do-able” but rather also includes the concepts of reasonableness, efficiency, expediency, proportionality and cost effectiveness.
Credit where it is due
The Court of Appeal’s judgment is also noteworthy for its content regarding the potential for a defendant to distribute damages to the class, which BT had argued the Tribunal lacked the jurisdiction to effect. The Court considered that the Tribunal’s powers going to the distribution of an aggregate award are wide-ranging (pursuant to Rule 93) and indeed include the potential for a defendant to assist with the same by crediting customers’ accounts.
Where distribution by a defendant is an appropriate means of class members receiving their share of damages, the Court added, the Tribunal could defray a class representative’s costs associated with the proceedings from the award prior to distribution (as opposed to taking the same from any undistributed damages following distribution).
Onwards to trial
At a CMC held by the Tribunal shortly after the Court of Appeal’s judgment was handed down, the Tribunal made clear its intention to proceed without delay and to set down a timetable to trial, which it is envisaged will take place in the first half of 2024.
The Tribunal also heard arguments going to the composition of the panel post-certification, which was the subject of the Tribunal’s subsequent ruling dated 20 May 2022. Highlighting another aspect of the Guide which could be revised, the Tribunal indicated that – contrary to paragraph 6.7 of the Guide – it considered it simpler for the existing panel to continue in post, including for trial, and for a separate panel to be appointed for the purposes of assessing any collective settlement application, should one be made.
Positive news for claimants
Beyond the obvious fact of the Court of Appeal’s ruling being good news for the consumers Mr Le Patourel represents, the Court’s clear statement that opt-in proceedings are not to be preferred over opt-out and the clarity offered as to the application of the provisions at Rule 79(3), are welcome. The former is particularly interesting considering the recent ruling from the Tribunal in FX, wherein certification on an opt-out basis was refused in favour of opt-in despite evidence that it would not be viable to run the claim on an opt-in basis.
Also good news, for the class in Mr Le Patourel’s claim, is the Tribunal’s willingness to set a timetable to trial and approach to the composition of the panel. Retaining the same Tribunal members who are already familiar with the case – as opposed to an approach in which a claim passes to a new, “trial tribunal” following certification – has the advantage of efficiency and, as the Tribunal commented, is in line with the overriding objective of allowing cases to be dealt with justly and at proportionate cost.
Lastly, a revised Guide which takes into account the Tribunal’s experience of the collective regime to date – in line with the Court of Appeal’s comments regarding the same – ought to be welcomed by litigants and practitioners alike. As the Court of Appeal noted, the Guide itself acknowledges that practical experience of what in 2015 was a novel jurisdiction for the Tribunal may necessitate future revision and, given the now fast-evolving procedural landscape of collective actions, an updated version is warranted.
With special thanks to Abigail Thrasher for her assistance.
  EWCA Civ 593
 Ruling dated 20 May 2022
 Parliament could have used several different drafting techniques to introduce a different presumption, had it sought to do so; but it did not, and such a preference cannot therefore be assumed - paragraph 61.
 Paragraph 112.
 Paragraph 68.
 Paragraph 77.
 Paragraph 83.
 Paragraphs 90-94.
 Paragraph 99.
 O’Higgins and Evans v Barclays Bank PLC and Ors  CAT 16