Group litigation: High Court emphasises need for co-operation between claimant law firms
Shazia Yamin and Holly Hampton discuss the recent judgment of Senior Master Fontaine in the VW NOx Emissions Group Litigation following an application for relief from sanctions by a law firm to have their clients added to the Group Register after the cut-off date.
Posted on 12 May 2022
Under the Group Litigation Order (GLO) Leigh Day are the joint lead solicitors in the litigation and are responsible for establishing and maintaining the part of the Group Register that the firm’s clients should have been entered onto and were included as an interested party in the application.
Background to the application
The law firm acting on behalf the applicants refused to provide Leigh Day with the information required to add their clients to the Group Register in the format which had been agreed between all other claimant firms and the solicitors acting on behalf of the Defendants.
As a result, their clients were not added to Group Register by the agreed cut-off date in February 2019. The applicant lawyers sought relief from sanctions which was granted by consent by the lawyers acting on behalf of the Defendants.
However, the applicant lawyers failed to inform Leigh Day of this, meaning their clients’ claims were not added to the Group Register by the extended cut-off date and were struck out for having contravened an unless order.
The applicant law firm issued a second application for relief from sanctions in July 2019 which also sought a declaration that the clients were deemed to be included in the Group Register based upon the information that been provided to Leigh Day in advance of the original cut-off date. There followed a delay of some 2 and half years and the application was heard by the Senior Master in March 2022.
Judgment of the Senior Master
This aspect of the application was dismissed without hesitation. In doing so, the Senior Master held that it was “the responsibility of all claimant solicitors to cooperate with the Lead Solicitors to enable them to comply with their obligations under the GLO”.
The refusal of the applicant law firm to do so, without good or indeed any enunciated reason, was in breach of the obligation in CPR 1.3 to assist the court in further the overriding objective.
The Senior Master observed: “it is especially important in group litigation for parties to behave in a responsible and cooperative manner so that the litigation can progress in an orderly and proportionate way.”
The relief from sanctions
In dismissing this aspect of the decision, the Senior Master considered the decision of Denton and held:
- The failure to join a group register prior to a cut-off date is clearly a serious and significant breach of a court order, and it “was hardly likely that second breach of an extended cut-off date would not equally, if not more so, be a serious and significant breach.”
- The was no good reason for the breach. The reason for the breach was the applicant law firms “failure to comply with its obligations to the court and to act reasonably and proportionately in the group litigation.”
- The delay in seeking to list the application for over 2 and half years would be sufficient on its own not to grant the relief from sanctions.
- The other relevant circumstances in the case included: the complete lack of co-operation by the applicant law firm with Leigh Day “to enable them to fulfil their obligations to establish, manage and maintain the Group Register; it is obvious that Claimant solicitors need to co-operate with each other and with the Lead Solicitors in group litigation, and this is particularly the case, as here where claimant number are in tens of thousands”; “the wholly unjustified attempt” by the applicant law firm to blame Leigh Day “for their own failings, which I regard as reprehensible, and I make it clear that I am satisfied that LD fulfilled its obligations as Lead Solicitors to establish and maintain the Group Register and did so in an appropriate and efficient manner”; and that the Group litigation had progressed significantly in the time since the breach occurred including that lead claimants had been selected from a pool of claimants which did not include the applicant law firms clients.