The decision in Jalla v Shell might be said to represent a step back for UK "class-action" style claims in its stricter interpretation of CPR 19.6. In reality, though, it simply highlights the difficulties in satisfying the "same interest" condition in non-data protection claims, as well as providing some helpful clarity and guidance for those who attempt to do so in future.
In August of this year, the High Court struck out the representative element of a claim brought on behalf of various Nigerian individuals and communities, seeking redress for damage allegedly caused to land and water supplied by a 2011 oil spill. The defendants applied to strike out the proceedings on various grounds, including that they could not properly constitute a representative action because the lead claimants and those they purported to represent did not all have the "same interest" as required by CPR 19.6.
Pending the hearing of the defendants' strike-out application, and in an attempt to circumvent it, the claimants issued fresh proceedings which largely mirrored the initial claims, with the exception that their additional proceedings (the "Protective Proceedings") were brought in the name of each individual and community. The claimants then applied to consolidate the two actions and submitted that the Protective Proceedings should be reserved for the "individualised" claims for damages, and that the original action need only address the claimants' remediation relief.
The High Court held that the proceedings could not continue as a Representative Action because the claimants did not satisfy the "same interest" condition; the representative element of the proceedings were therefore struck out, leaving the personal claims of the two lead claimants as well as the Protective Proceedings. Notably, Mr. Justice Stuart-Smith acknowledged that there could be no doubt that the claims raised common issues of law and fact, but that those alone would not give rise to a right to relief. Each individual claimant or community would have to prove that the oil spill caused them damage, a requirement which could not be reconciled with the "same interest" condition. Mr. Justice Stuart-Smith did, however, hold that were the "same interest" condition satisfied, the representative proceedings would not have been struck out on the basis of failure to ascertain the relevant class.
Mr. Justice Stuart-Smith helpfully distilled the relevant principles on the "same interest" condition in CPR r. 19(6)(1) as follows:
- The “same interest” condition is statutory and should not be abrogated or substituted by reference to the overriding objective. It is, however, to be interpreted having regard to the overriding objective and should not be used as an "unnecessary technical tripwire".
- The “same interest” which the represented parties must have is a common interest, which is based upon a common grievance, in obtaining relief that is beneficial to all represented parties. It is not sufficient that multiple claimants wish to bring claims which have some common question of fact or law.
- The existence of individual claims over and above the claim for relief in which the represented parties have the same interest does not necessarily render representative proceedings inapplicable or inappropriate. The question is whether the additional claims can be regarded as “a subsidiary matter” or whether they affect the overall character of the litigation.
- Similarly, while the court will pay little attention to potential individual defences that are merely theoretical, the existence of potential defences affecting some represented parties’ claims but not those of others tends to militate against representative proceedings being appropriate.
- There need not be a congruity of causes of action between the lead claimants and those they represent, so long as there is no conflict between them, and the causes of action are "in effect" the same for all practical purposes. This was the case in Millharbour Management Ltd v Weston Homes Ltd ( EWHC 661 (TCC)), a rare example of a representative action granted in a non-data protection claim, involving allegations of defects in a block of flats.
- If the criterion of “the same interest” is satisfied, the court’s discretion to permit representative proceedings to continue should be exercised in accordance with the overriding objective.
What can we take from Jalla v Shell?
The decision in Jalla v Shell reflects a continued strict interpretation of the "same interest" condition required for a Representative Action, but the following useful guidance can be gleaned for future purposes:
- Individual elements over and above the claim in which the parties have the "same interest" will not preclude a Representative Action, so long as the individual elements are "subsidiary" to the main issue. In this case, individual issues of causation and damage were held to be integral to the issues raised.
- Claimants are more likely to satisfy the "same interest" condition if the claimants are seeking a uniform amount of damages, without having to prove damage for each individual.
- The defendants' ability or requirement to advance individualised defences will militate against the appropriateness of a Representative Action, although it will not automatically preclude one.
- Claimants should not forget that there are alternative, perhaps more easily sought, mechanisms by which they can commence multi-party proceedings.