Group actions are a cost effective way of dealing with problems a consumer has with large companies.
If a company sells a product (like timeshare) to consumers, those contracts and constitutions are generally the same.
We appreciate over time amendments are made and constitutional rules may change, however, courts can separate the issues and generate sub groups. This is done so the test cases in each sub case can be heard and the findings applied to other actions in the sub case group.
Therefore say 100 people have issues and the resort rebuts all those issues (raised by the consumers)- the costs will plummet dependent on the numbers in the sub groups. As a further advantage the risk of adverse cost orders will also plummet as the work will be less and the risks spread. Group actions do create a level playing field for all litigants.
How to commence a group action.
The first objective is to locate others who are experiencing the same problems (you are having) and try and get a consensus on the issues.
If all you have spoken to have the same complaints, then each of you should visit with other people to determine if more people are suffering as a result of the issues which you face, including costs, obligations, changes, amendments, etc, in your timeshare.
At this point you should decide what you want to do and consult an association on what your options are. There are a variety of associations and government bodies who consumers can turn to.
At this stage each person should carry out their own investigations and discuss the options given with other likeminded people.
Once you have decided which option you want to explore you ought to consult the advisor and obtain recommendations to a path to take. This will probably involve (if a legal issue) a solicitor.
At this point you ought to be given a document which constitutes a club, so you all know the rules of the club and the responsibilities of any person acting on behalf of the club has.
Remember at all times you are acting as a group and should have a duty to the entire group not just your own interests.
At this stage you should elect officers of the club who can start the process and the courting of others suffering the same problems.
The formation of the club committee is a very important aspect and it is this committee which will represent the members in all aspects. You cannot have a committee of 1, it has to exist with a variety of people who can add to the discussions, who can challenge matters discussed and who are competent, fair and reasonable.
Usually 5 committee members will do it. In actions such as timeshare those members can be asked to represent a group of people who are in the same region so that it cuts down costs and duplication of admin.
The committee may consist of non legal minds that have never experienced litigation in the past. It may be advantageous to have a selection of people from a variety of socioeconomic backgrounds, so all members have a voice and can contribute perhaps with different opinions. The committee should also have available others who can assist them. The others ought to be advisors or companies who don’t have a financial interest in the outcome.
Solicitors could be a good choice, however, if those solicitors are on fee arrangements they could be compromised.
As you promote the action group membership should grow. If it does not then you ought to take stock, as it could be that others have thought about the issues and concluded “your opponents are correct”. It’s always worth a chat with any dissenters as they could be a valuable sounding board.
At this point it is wise to investigate your issues before embarking into litigation. All members will have to provide ALL the documents in their possession and which will be relevant to the proceedings if the happen.
As matters are now about to be investigated, members and/or the committee should write down the issues which affect that member and which issues they want resolving.
At this point the club will need funds from each member who requires assistance. This is not a cheap exercise and the members complaints will be inspected, assessed and placed into sub categories.
Once the sub categories have been established the contract, constitution and the historic additions, amendments, alterations and subtractions will have to be investigated so as to eliminate any potential litigation problems.
Once the investigation has been assessed by the committee, a final draft of the investigation findings can be presented to the solicitor who can provide a legal advice on the issues the group have raised. With the documents the group can size up the advice and firm up any outstanding matters which will add to the benefit of the case and/or detriment, so a proper assessment is made. At this point the group will have to obtain short bullet point statements as to any allegations raised in respect to verbal representations etc.
This above all, will give the members, solicitors and advisors a good grounding and will put the action on a good footing.
Once the above has taken place and advice received a big decision has to be made. This is now a matter for each person and not the committee as each person must justly consider what actions can be taken, what direct cost will be attracted (by the action taken), what possible adverse cost orders could be waiting round the corner and how each member will be able to finance their contribution.
To lock people into a group litigation before all is known is simply wrong and the group will flounder.
No pressure should be applied to anyone, it’s their choice to either continue with the quest or to exist before proceedings are commenced as when they are commenced there is no easy exist. In short each member is in it for the long haul. Not to afford a member this opportunity is simply unjust and wrong.
Each member should consider
1) Can I afford the costs estimate?
2) Can I afford to expose myself to the adverse cost order risk?
3) Do I believe in my case?
4) Have I got confidence in my co members and committee to look after my best interests?
5) Are there any other less costly ways to achieve what I want?
6) Will the action which I am being asked to commit to satisfy my needs?
Committees should always embrace the want and need of its entire membership. Some members may know that the proposed action is right, they may have great confidence in the administration, governance and advice given but they just cannot (due to personal circumstances) commit to the risk and cost consequences.
They might be scared, overly worried, want an easy exit, there are an abundance of reasons, all real to those who have them. This is why, before the presentation, every arena, jurisdiction and forum should be considered.
Once litigation is about to commence then this will consist of an amended club and a disillusionment of the old club. In the event that others wish to jockey on the work done by the investigation club this should be considered separately.
Last modified: March 11, 2016