Group proceeding has been possible in Sweden for eight years, far from
causing the boom of litigations, which some people feared. Till now, thirteen
cases have been brought to group action. Still, the traditional model of court proceeding
dominates the civil cases, even when a group proceeding could be an
alternative.
The Group Proceedings Act of 2002 has
introduced the institution “class action” in the Swedish legal system. This act
makes it possible to bring private group (class) actions, public actions, and
organizations actions for injunctions and individual damages. Group proceedings
may relate to claims that can be dealt with by a general court in accordance
with the rules for judicial procedure on civil cases. Further, a class action
is possible according to some special rules in the area of environmental law.
In a group action one plaintiff may bring an
action as the representative of several persons with legal effects for all of
them, although they are not parties in the proceedings.
Group action law suits
can be brought to specially appointed district courts. Any individual or legal entity that has a
potential claim in an area of civil law, is entitled
to initiate a group proceeding. A non-profit association that, in accordance
with its rules, protects consumer or wage-earner interests in disputes between
consumers and a business operator is also entitled to initiate such a
proceeding. Further, a group action may be brought by an
authority if the object of the dispute is appropriate. The plaintiff, if not an authority, must normally be represented by
a lawyer (Sw. advokat) who is a
member of the Swedish Bar Association.
These are the basic pre-requisites for a group
action to be permitted:
1.
The case is based on the same or
similar common conditions within the group
2.
A class action will not be
inappropriate due to differences in the claims within the group
3.
The larger part of the claims cannot
equally well be pursued by personal actions by the members of the group
4.
The group will need to be suitable
in regard to size, limit and other circumstances
5.
The plaintiff is suitable to
represent the group members in regard to his interest in the matter, his
economic conditions and other circumstances.
Any individual or legal entity may be sued in
a group proceeding. The claim must have reference to civil law or some specific
environmental law rules, but besides that, there are no restrictions in regard
to the kind of cases applicable. Thus,
not only tort cases, but also matters like reimbursements, restitution,
prohibition or precautionary measures may be handled within the frames of a
group proceeding.
Till now, thirteen cases have been brought to group
action in Sweden. Four of them are pending, three have been dismissed, one has
been withdrawn, and two are settled. Three cases have been decided by a
district court. Two of them dealt with obligations for suppliers of gas and
electricity and the third one was a claim for 43 women versus the state of Sweden.
A veterinary college had given advantage to men in a lottery-drawing
in order to be admitted to the education. EUR 3 500 each was awarded to the
women by the court.
The traditional model of private proceeding
still dominates the civil law cases, even when a group proceeding could be an
alternative. One important reason is the insurance system. Swedish standard property
insurances for private persons and corporations generally provide a limited protection
for proceeding costs, but class actions are excluded from this insurance protection.
It is easy to understand, that this is a considerable disadvantage for anyone
considering a group action. As a consequence, hundreds of persons in a private
placement dispute after the Lehman Brothers bankruptcy recently chose ordinary proceeding
instead of group proceeding and thus make use of their property insurances to
cover the litigation costs.
Staffan Michelson
