Changes to the High Court Rules could soon be made, following yesterday’s announcement of a consultation by the Rules Committee which intends to further facilitate the bringing of representative actions (or “class actions”) in New Zealand.
The Rules Committee is a statutory body charged with developing, reviewing and amending the procedural rules used in New Zealand courts.
The short consultation paper, along with a consultation draft of proposed amendments to the High Court Rules, can be found here. The amendments are focused on the manner in which representative proceedings are commenced. In particular, by supplementing the existing Rule 4.24 (which governs representative actions), the amendments include:
A specific rule that, for limitation purposes, a representation order will apply from the date the statement of claim is filed regardless of whether the court makes an order on after that date;
A requirement that an affidavit by a party making an application for a representative order must include specific information, such as the existence and identity of any litigation funder and a proposal to ensure all potential class members have been identified and notified of their right to join the proceeding ("opt-in");
Perhaps most significantly, a new provision that adopts principles developed in the Court of Appeal and Supreme Court relevant to determining if a representative order should be granted.
The way in which representative actions are currently commenced has largely evolved through case law, in particular the Saunders v Houghton case (the Feltex Litigation). The proposed changes intend to formalise and make that procedure more accessible.
These particular amendments are not intended to bring about significant reform to class action litigation. For example, the consultation paper specifically notes that the proposed rules do not address whether an opt-out procedure (where people are presumed to be part of the class unless they elect not to be), should be permissible under the High Court Rules. That is seen to be a matter for the legislature to address.
The amendments should, therefore, simply codify the existing case law requirements and position. Nonetheless, parties interested in the development of the law in this area - Bell Gully included - will be studying the proposed amendments and their implications carefully.
Submissions are due by 16 November 2018 and can be made by members of the legal profession or the wider public. Please feel free to contact the authors if you wish to discuss this development.
This publication is necessarily brief and general in nature. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.