The Supreme Court of Appeal has provided guidance for
prospective litigants intending to institute class actions in
relation to breaches of the Competition Act. The SCA's judgment
relates to a class action brought in 2010 by NGOs and consumers
against bread producers, who were found guilty of fixing the bread
price in 2007.
The SCA extended the right to bring class actions in the case of non-constitutional rights matters, and provided certain guidelines that should be followed.
In deciding whether or not to permit a class action, the SCA has prescribed that courts should determine whether the following features to the proposed class action are present:
- an objectively identifiable class;
- a cause of action raising an issue that a court may consider;
- common issues to be dealt with in the interests of all of the members of the identified class;
- appropriate available procedures for distributing damages to the members of the class; and
- the persons bringing the action are suitable representatives for the class.
If these features exist, the court issues a class certificate
and the action can be formally instituted.
The SCA referred the matter back to the Western Cape High Court, which refused to issue a class certificate to NGOs and consumers against bread producers in 2010. The Western Cape High Court will now have to determine, on the basis of the guidelines above, whether to certify the class action.
Click here to read the judgment of Nugent JA.
Click here to read the judgment of Wallis JA, wherein class actions are discussed in detail.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.