The North American-style class action has been largely rejected throughout Europe. In the past 10 years, however, many European countries have developed unique approaches to collective redress. This article is the fifth in a series of articles which examine the development of multi-party litigation in specific jurisdictions outside North America.1

Until recently, the collective redress regimes of most European countries appeared particularly foreign to Canadian lawyers. The Group Litigation Orders of the U.K., the Dutch Collective Settlements Act, which authorizes class action settlements but not class actions, and the test case model of Germany bear little resemblance to the North American-style class action. However, Norway's class action legislation, in force since 2008, is strikingly similar to Ontario's Class Proceedings Act ("CPA").

The Introduction of, Class Actions in Norway

Historically, Norway resisted the North American-style class action. For the last century, Norway only permitted a form of "representative litigation," in which interest organizations .may bring an action for non-compensatory relief to protect the interests of a group or the general public. In 2001, however, Norway's law reform commission proposed changes to the Dispute Act 1915, which governed civil procedure in Norway. This proposal included the addition of special rules permitting class actions for compensatory relief.2

The commission's recommendation to introduce class actions to Norway was not welcomed with open arms. A hearing on the issue .was held. Critics argued that existing procedures such as representative litigation, joinder, consolidation and test cases were adequate modes of collective redress. Other opposition included concerns that class actions would create an overly litigious society and that collective redress was not in accordance with the fundamental "right to be heard" principle of Norway's civil law system.3

Despite this resistance, the Ministry of Justice ultimately adopted the proposal of the commission. The new legislation, the Act Relating to Mediation and Procedure in Civil Disputes (the "Act"), came into force on January 1, 2008.

Chapter 35 of the Act

Norway's class action regime is found in Chapter 35 of the Act.4 A "class action" is defined in the Act as "an action that is brought by or directed against a class on an identical or substantially similar factual and legal basis, and which is approved by the court as a class action.5. Sections 35-2 to 35-15 set out the rules that govern a class proceeding in Norway.

Similarities to Ontario's Class Proceedings Act

In many ways, Chapter 35 mirrors Ontario's CPA. A class action may be brought by anyone who is qualified to be a class member or an appropriate interest organization.6 Like in Ontario, the court must approve the class action before it may proceed, There are four requirements for court approval:

  1. several legal persons have claims or obligations whose factual or legal basis is identical or substantially similar;
  2. the claims can be heard by a court with the same composition and in the main pursuant to the same procedural rules;
  3. class procedure is the most appropriate way of dealing with the claims; and
  4. it is possible to nominate a class representative pursuant to section 35-9.7

Once a class action is approved, the court has a series of other decisions to make. It must describe the scope of the claims that may be included in the class action,8 which is similar to the statement of common issues in an Ontario class action. The court may decide that a class be broken into subgroups if necessary.9 The court must also nominate a class representative.10 This class representative is obligated to safeguard the rights of the class and ensure that the class members are kept properly informed of the action.11 Finally, the court decides the form and content of the notice that must be provided to potential class members.12

Differences From Ontario's Class Proceedings Act

The key distinction between the class action regime in Norway and the regime in Ontario is that Norway. permits both opt-in and opt-out class actions.13 In addition to the other decisions that the court must make, as described above, the court must decide whether the class action should proceed on an opt, in-or opt-out basis.14 An opt-in class action requires that class members add their names to the registry, which is maintained by the court.15 Like in Ontario, an opt-out class action assumes that persons within the scope of the class action are members without requiring registration.16 A class action can proceed on an opt-out basis only if the claims meet the following two criteria:

  1. the claims on their own involve amounts or interests that are so small that it must be assumed that a considerable majority of them would not be brought as individual actions; and
  2. the claims are not deemed to raise issues that need to be heard individually,17

Based on this test, it. is likely that small breach of contract class actions could proceed on an opt-out basis while mass tort personal injury claims would proceed on an opt-in basis. Depending on how literally courts interpret part (b) of this test, it might be nearly impossible to establish that the claims do not raise issues that need to be heard individually since damages are most often individualized.

Perhaps the most interesting distinction between the Act and Ontario's CPA is Norway's approach to costs of class counsel. Like in Ontario, the basic approach to costs in Norway is the 'loser pay' principle18 and the class representative is responsible for the costs of an unsuccessful class action.19 However, section 35-6(3) creates a special rule for the funding of class Counsel costs in opt-in class actions. On an application by the class representative, the court can decide that as a condition of registering into an opt-in class action, class members must accept liability for a specified maximum amount of costs.20 The court can also require that the money be paid to class counsel before registration. Section 35-14(2) provides that former class members of an opt-in class who have withdrawn .by deregistration are also liable for the liability imposed under section 35-6(3), unless ordered otherwise.21

This model is a unique alternative to the contingency fee agreement model, However, requiring class members to "buy-in" to the litigation might discourage participation in the class action.

One area of .concern is that, unlike Ontario's CPA, the Act does not contain a clear division between the adjudication of common issues and individual issues. The legislation states that subgroups might require a different hearing from the main class. However, there is no discussion of what happens after a trial of the claims common to the class. Section 35-11 comes closest to contemplating the adjudication of individual issues, which provides that the court may Split the adjudication and. role on the claims of one or more of the class members and then follow the first judgment to subsequent proceedings. However, this approach appears to be more of a test case approach than the common issues and individual issues approach in Ontario. As a result, it is unclear how the assessment of damages of each class member will occur.

The Future of Class Actions in Norway

Norway's relatively new class action legislation is the closest Europe has come to a North American-style class action. The Act shares many of the same or similar features of Ontario's CPA" an approval hearing (much like certification); a .statement of the common claims; subgroups, where necessary; class representative; notice program; and the basic "loser pay" principle. The only difference of any significance is that Norway is both an opt-in and opt-out regime. Unfortunately, according to current reports, few class actions have been launched in Norway since the Act came into force.22 It remains to be seen whether this slow start is due to the infancy of the legislation and Norway's lack of experience or the hybrid nature of the legislation.

Footnotes

1 See James M. Newland, Brian P, Moher and Donna A. Polgar, "Group Litigation in the United Kingdom: a Sheep in 'Woolf's' Clothing'.' (2006) 5 Class Action 310; James M. Newland, Brian P. Moher and Jason W. Reynar, "A Touch of Dutch: Group Actions in. the Netherlands" (2007) 6 Class Action 394; James M. Newland, Brian P. Moher and Rosie J. Kogan, "Group Actions in France and Current Initiatives for. Reform" (2007) 5 Class Action 338; and James M. Newland, Louise F. Moher and Lynda Morgan, "Multi-party Litigation in Germany: the KapMug in Action" (2008) 6 Class Action 424.

2 Camilla BerntsHamre, "Class Actions, Group Litigation & Other Forms of Collective Litigation in the Norwegian Courts," Centre for Socio-Legal Studies, University.of Oxford, at 4 ["Bernt-Hamre"].

3 Bernt-Hamre, ibid. at 5-7.

4 LOV-2005-06-17-90, Act Relating to Mediation and Procedure in Civil Disputes, (The Dispute Act) 17 June 2005 no. 90 ["The Dispute Act"] (English translation).

5 The Dispute Act, ibid., s. 35-1(2).

6 Ibid., s. 35-3.

7 Ibid., s. 35-2.

8 Ibid., s, 35-4(2)(a).

9 Ibid., s. 35-10(2).

10 Ibid., s. 35-4(2)(e).

11 Ibid., s. 35-9.

12 Ibid., s. 35-5.

13 Note that this legislation is very similar to that of Denmark, also in force since January 1, 2008. See Erik Werlauff, "Class actions in Denmark from 2008," Centre for Socio-Legal Studies, University of Oxford.

14 The Dispute Act, supra note 4,s. 35-4(2)(b).

15 Ibid., s. 35-6.

16 Ibid., s. 35-7.

17 Ibid., s. 35-7(1).

18 Ibid., s. 20.

19 Ibid., s. 35-12.

20 Ibid., s. 35-6(3).

21 Ibid., s. 35-14.

22 Fred Arne Gade, "Norway" from the International Comparative Legal Guide to Class and Group Actions 2009, published by Global Legal Group, found at http://www.iclg.co.uk/khadmin/Publications/pdf/2325.pdf.

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