Group Litigation Orders: Supreme Court Clarifies When Courts May Order That A Judgment On A GLO Issue Is Not Binding On Other Parties Due To A Subsequent Change In The Law

The case also shows that the court must interpret a judgment in a test case in context and without hindsight in determining the extent to which it binds other claims. 

The Supreme Court has dismissed an appeal against orders that decisions in test cases in the long-running CFC and Dividend GLO were not, or should not be, binding on other cases on the group register where there had been dramatic changes in the law since the test cases were decided: Axa Insurance UK Plc v Commissioners of Inland Revenue [2026] UKSC 24.

As the decision emphasises, the purpose of a GLO is to enable multi-party actions to be determined efficiently on a collective basis. To that end, under CPR 19.23(1)(a), a judgment or order in relation to a GLO issue automatically binds all other claims on the group register at the time, unless the court orders otherwise. As the court notes (citing the second edition of Class Actions in England and Wales, written by lawyers from HSF Kramer), this is seen as one of the key advantages of using a GLO to resolve multiple claims.

The Supreme Court identified two conflicting key considerations which it said are of great importance: the need to maintain the integrity of the GLO regime by treating a decision in a test case as binding; and a party's right to have their dispute decided according to a correct understanding of the law.

Balancing those considerations means that the court should order that a test case decision will not be binding, based on a subsequent change in the law, only where it has been clearly established that the legal basis for the test case decision was wrong. It is not enough that there is some doubt about its correctness or that the parties to the follower cases wish to raise different, and potentially better, arguments than were raised in the test case.

Even where the legal basis for the test case decision has been found to be wrong, the court will still need to consider whether, in the particular circumstances, it would be unjust to exercise the discretion to order that the decision will not be binding – for example because the result of doing so would be to impose on the parties further lengthy and costly litigation. All of this means that the discretion is likely to be exercised only in a rare case.

The decision also shows that, even where the court has made a decision on a GLO issue, the decision may not be binding on the follower claims because of the fact-specific nature of what was decided.

For more information see this post on our Litigation Notes blog.