Edward Moon & Ors v Link Fund Solutions

A group litigation order is discretionary. The existence of numerous claims raising common or related issues does not itself justify making one. The court must consider whether ordinary case-management powers, including generic pleadings, test cases, costs directions and bespoke directions, can achieve substantially the same result.

GLO issues should identify the broad issues for adjudication without attempting to plead every detailed question or pre-judge the answer. Individual issues, particularly concerning quantum, do not necessarily undermine the utility of group litigation. A GLO is a case-management mechanism, not a means of encouraging potential claimants to sue. The court should therefore scrutinise publicity, group-register and lead-solicitor arrangements with particular care.

The claimants sought a group litigation order under CPR 19.11 concerning proposed claims against Link Fund Solutions as authorised corporate director of the LF Equity Income Fund. The claims arose from alleged breaches of the FCA Handbook rules, including the Collective Investment Scheme Sourcebook, and alleged losses following the Fund’s suspension and winding-up.

Numerosity and common or related issues were accepted. The principal questions were whether a GLO was necessary or appropriate at that stage, how the GLO issues should be formulated, and whether the proceedings could instead be managed through ordinary case-management powers, particularly given the possible involvement of further claimants and related claims against another defendant.

1. Application refused. The court declined to make the GLO sought, but directed the further conduct of the existing proceedings.
2. Under CPR 19.10 and CPR 19.11, the jurisdictional requirements were satisfied: there were numerous claims raising common or related issues of fact or law. Those requirements did not determine whether the discretionary relief should be granted.
3. GLO issues should identify the broad issues actually requiring adjudication without formulating all specific trial questions or pre-judging their answers. The source of the alleged duties and the generic consequences of any breach should be identified. Causation may contain common elements, such as whether alleged breaches caused poor performance of the Fund, while individual exposure periods and quantum remain claimant-specific. The court relied on Tew v BoS [2010] EWHC 203 (Ch) in reaching this conclusion.
4. The advantages of a GLO, including generic pleadings, binding directions for registered claimants and costs-sharing arrangements, could substantially be achieved through ordinary case-management powers. Individual issues did not by themselves negate the utility of a GLO, but the complexity of the claimant groups, the uncertain position of the RGL Claimants and possible related proceedings against HL made an immediate GLO premature and undesirable.
5. A GLO should not be used to encourage claims. It was therefore inappropriate to require Link to notify Fund shareholders of the litigation at the court’s direction. The court agreed with Mohammed Arif & Ors v Berkeley Burke SIPP Administration Ltd [2017] EWHC 3108 (Comm) on that point. Manning & Napier Fund v Tesco [2017] EWHC 2203 supported careful consideration of alternative procedures, while Hobson v Ashton Morton [2006] EWHC 1134 (QB) was distinguishable on its materially different scale and value.
6. Issued claim forms were to be served within 21 days. The PLS Claimants were to serve generic particulars of claim within 42 days, followed by schedules of information and a generic defence within the ordered timetable. Where the misleading-prospectus claim was pursued, the schedules had to state whether each claimant read, relied on or was influenced by the prospectus and identify its version, but fuller particulars were disproportionate at that stage.