On 11 December, in a long-awaited judgment (and in maybe distinctive circumstances), the Supreme Court docket dismissed Mastercard’s attraction within the ‘gargantuan’ collective motion introduced by Walter Merricks CBE. In doing so, the courtroom has markedly lowered the bar to be utilized on the certification stage for competitors collective actions. This judgment may have a major affect on collective actions – that are nonetheless of their relative infancy – for years to return. Merricks’ declare will now return to the Competitors Attraction Tribunal (CAT), which is able to determine once more (now with clear steerage from the Supreme Court docket) whether or not to certify the declare by granting a collective proceedings order (CPO). 

Louise freeman

Harry Denlegh-Maxwell

The judgment additionally implies that different collective motion claims, which had both been stayed or are ready within the wings pending Merricks – together with these associated to vans, railway tickets and FX – will now additionally have the ability to proceed.


Merricks, the previous head of the Monetary Ombudsman Service, is the proposed class consultant for 46.2 million individuals who, between 22 Could 1992 and 21 June 2008, bought items and/or providers from companies within the UK that accepted Mastercard. Merricks has valued that declare in extra of £14bn (this sum will possible now be even better, with curiosity having continued to run for the reason that declare was filed in September 2016).

Final result

To certify a declare, the CAT have to be glad that the 2 fundamental standards have been met: that it’s simply and cheap for Merricks to behave as the category consultant (part 47B(5)(a) of the Competitors Act 1998 as amended (the act)); and that the claims are eligible for inclusion in collective proceedings (part 47B(5)(b) of the Act). The CAT refused to certify the declare on the bottom that the claims failed this second requirement, as a result of they weren’t appropriate for an mixture award of damages, and Merricks’ proposed distribution of any award didn’t fulfill the compensatory precept in frequent regulation.  

Following a profitable attraction by Merricks to the Court docket of Attraction, the Supreme Court docket dismissed Mastercard’s additional attraction, agreeing with the Court docket of Attraction that the CAT made errors of regulation.

With a selected concentrate on the coverage concerns underpinning the English and Welsh collective motion regime, the Supreme Court docket held that collective proceedings are a particular type of civil process designed to supply entry to justice and guarantee non-public rights might be enforced the place an odd particular person declare can be insufficient.  

When contemplating whether or not claims are ‘appropriate’ to be introduced in collective proceedings or for an mixture award of damages, the Supreme Court docket held that the CAT ought to have requested itself whether or not the claims are extra appropriate to be introduced in collective proceedings, versus particular person proceedings, and extra appropriate for an award of mixture damages, versus particular person damages. This considerably lowers the bar, since will probably be tougher to argue that it will be higher for a declare to be introduced by every particular person shopper than on a collective foundation (versus not being appropriate for different causes).  

The Supreme Court docket additionally issued agency steerage that the compensatory precept (that’s, making certain that every claimant is compensated for the loss that they individually suffered) is just not a component of the take a look at for granting a CPO, and that consideration of distribution strategies on the certification stage will typically be untimely (though not in each case). It was additionally crucial of the CAT’s failure to work with the information obtainable to simply accept that it will have the ability to assess damages, by software of the ‘broad axe’ precept.  

Consideration of the deserves of the case, nevertheless, was stated to be for a strike-out or summary-judgment software, and never the CPO listening to. 

Distinctive procedural difficulty

One other attention-grabbing problem arose for the Supreme Court docket on this case. Handing down of the judgment was delayed following the unlucky passing of the previous Supreme Court docket justice, Lord Kerr, who had presided on the listening to.

The judgment was going to be a 3:2 majority resolution dismissing the attraction.  Nevertheless, following Lord Kerr’s dying, the 4 judges would have been cut up 2:2 (Lord Kerr having been a part of the bulk). The dissenting judges (Lords Gross sales and Leggatt) agreed to vary their place from dissenting to dismissing the attraction, such that the three:2 majority final result could possibly be given impact, in accordance with Lord Kerr’s views, and to keep away from the associated fee and delay of an additional listening to. 

What subsequent?

Though Merricks’ case lives to battle one other day, it has not but been given the go-ahead as a collective declare. The case will now return to the CAT for a second try by Merricks at acquiring a CPO, however this time with clearer steerage as to the brink. As that threshold has been lowered by the Supreme Court docket, it appears extra possible that CPOs could also be made going ahead.  

This judgment breathes new life into the category motion regime, below which no lessons have been licensed because it was launched in 2015. The numerous circumstances ready within the wings can now transfer ahead to their very own CPO hearings, with extra certainty as to the brink the claimants should meet.  The CAT will now want to contemplate every of those circumstances in flip, with the good thing about the Supreme Court docket’s steerage. 


Louise Freeman is a associate and co-chair of Covington’s European dispute decision follow; Harry Denlegh-Maxwell is an affiliate on the agency