Browsing by Author "Judström, Aili"

A class action is a procedural instrument where the traditional constellation of two party litigation is set aside. In a class action, a group is summoned and the group together pursues a lawsuit, normally aiming to receive a compensatory relief. Like any other civil law judgement, class actions decisions are injunctive, declaratory or compensatory. The Finnish Act on Class Actions entered into force in October 2007. The first memorandum of the Act was wide in scope and even allowed the opt-out system. The only restriction in applicability was that the case had to be a civil claim. Over the several years of law-drafting the Act went from liberal to restrict. Today the Act allows only the Consumer Ombudsman to have exclusive standing to bring forth a case on the behalf of numerous consumers. The ratio of the act was to ease the consumers’ access to court and through that, help consumers to gain compensation when hurt by a unlawful company practise. Six years in force, the Act remains unused. This thesis sets out to study why such an act exists in the Finnish legal system. When the Act on Class Action was drafted it met heavy resistance from the industry and commerce. Stakeholders not in favour of the proposals used the US class action as a deterrent when arguing against the introduction of class action in Finland. The stakeholders boldly mixed challenges in US litigation, such as punitive damages, contingency fees and frivolous lawsuits with the class action instrument and blamed it all on Rule 23 in FedRCP allowing the federal class action. Analysing class action from a law & economic point of view, it becomes evident that it is a procedural instrument with two major positive functions, deterrence and the reparative effect. The Act does however not reach these functions and should thus be amended. The Swedish model allows three different forms of class action - the private, the organisation and the public group action. The act allows all civil claims in general courts as well as environmental claims in special courts. The Swedish act is actively used and there are no signs of abusive litigation in Sweden. The Swedish Act resembles its US paragon, the big difference being that the US enforces the opt-out model. Finland should follow Sweden and dramatically widen the applicability of the Class Action Act.