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Class Actions – Proposals for improving take-up rates

Montreal, March 28, 2018 – A large number of class action suits are initiated in Canada every year. When there is a settlement or a favourable judgment, the members of many of these class actions are eligible for compensation. In a research study published today, Option consommateurs has analyzes the factors that influence take-up rates and suggests solutions for increasing them. “Our goal in conducting this study was to determine the most effective procedure for ensuring that the highest possible number of members receive compensation,” says lawyer Josiane Fréchette, who co-authored the report.

A class action is a process that allows one person or organization to institute legal proceedings on behalf of a group. It is used when several people have a similar claim against the same defendant. “It allows consumers to have access to justice in circumstances that would otherwise be difficult,” Fréchette states. “There are unfortunately many cases when only some of the members are compensated.”

In its report, Option consommateurs proposes solutions for increasing the take-up rate. These include: providing clear, concise notices, writing messages that are tailored to specific circumstances and members, using a variety of communication strategies, and employing claims procedures that contain a small number of steps and require few supporting documents. “When the members do not know that the class action exists, do not understand the messages sent to them or have to make an effort that is disproportionate to the amount they are likely to receive, they are not likely to file a claim,” Fréchette says.

The Option consommateurs study provides only a partial portrait of the situation, as the organization found it difficult to obtain data on class action distribution processes. “There is no public registry in Canada that contains such information,” the lawyer said, “and several law firms are reluctant to provide it. Nevertheless, it is information that is important for both the justice system and the public.”

In its report, Option consommateurs also states that judges have the power to issue appropriate orders and that this would contribute toward improving the situation. In addition, the organization recommends that a comprehensive, informative accountability process be set in place and that judges employ all the discretionary powers vested in them by law. “We hope they will read our study and find inspiration in it.”

The Option consommateurs research report entitled “Class Actions: How Can Take-up Rates be improved?” was made possible thanks to a contribution from Innovation, Science and Economic Development Canada’s Office of Consumer Affairs.

 

About Option consommateurs

Option consommateurs is a not-for-profit association whose mission is to defend the rights and interests of consumers. It is very involved in issues related to personal finance, business practices, financial services, privacy, energy, health and agri-food.

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Source: Elise Thériault Tel : 514 777-6133