Time to look at allowing class-action lawsuits
Access to justice is a fundamental right of every Hong Kong person. Sadly, for many, access is not equal. People face being deprived of the right to pursue a legal remedy either because they are neither wealthy enough to afford the cost of going to court nor poor enough to qualify for legal aid, or because the loss is too small to justify the cost of seeking compensation. Such inequity is not good for our system of justice.
A striking example is when a large number of people claim to have been adversely affected by the action of another person, a corporation or government, but some or all of the claims are too small to make individual litigation economically viable, even if those concerned can afford it.
The Law Reform Commission has issued a long-awaited consultation paper on a remedy long adopted in some other jurisdictions - multiple-party litigation, known as class actions, in which claims of a number of people against a single defendant over the same alleged wrong can be determined in a single court action. A representative plaintiff effectively sues on behalf of all of them. Potential class-action groups that come to mind include shoppers who fall victim to consumer fraud or faulty products, people who suffer personal injury such as food poisoning, flat buyers complaining about poor workmanship, and investors who claim misleading or negligent investment advice.
At present, the only machinery for such representative proceedings in Hong Kong is a High Court ruling. But a report some years ago by the Chief Justice's working party on civil justice reform found it to be restrictive and inadequate. It is true that cases here can already affect more people than those directly involved, by setting a precedent that has to be followed. Sometimes, there is a test case that serves that purpose. But to benefit directly from the proceedings someone usually has to be a party to the legal action. During the right-of-abode saga, for example, hundreds of abode seekers filed actions to try to ensure they did not miss out on the benefit of any favourable judgment.
Any reform that promises to improve access to justice is welcome. Class actions have generally achieved that elsewhere. But they have also raised concerns that they unduly encourage litigation and that the process can be exploited by litigants and lawyers. In Hong Kong, they could be a potent weapon, given the increased willingness of people to resort to the courts to resolve their disputes. The commission's class-actions subcommittee has rightly acknowledged the need for safeguards against abuse, such as protecting successful defendants from being unable to recover costs from an impecunious plaintiff. It recommends that cases be allowed to proceed only if they have been certified by the court.
While class actions may enhance access to justice, they do not necessarily make justice more affordable to the representative plaintiffs. In the long term, the subcommittee envisages a general fund to finance class actions.
These proposals are bound to arouse concerns in the business community that it will be exposed to costly, time-consuming litigation. But, subject to proper safeguards against abuse of process, they would strike a fairer balance in the interests of justice, given that the cost of going to court in Hong Kong is prohibitive to most people. The subcommittee will not submit its final report for a year or more. Hopefully, the government will treat this one seriously, instead of letting it gather dust along with other reports on law reform.
