This judgement contains: a very useful review of the development of class actions in South African law; a consideration of whether to certify the particular class action on an opt-out or opt-in basis and decides that the interests of justice warranted certification of the class action on an opt-out basis.
An opt-out class action automatically binds members of the class to the class action and to the outcome of the litigation unless the individual class members take steps to opt-out of the class action.
The opt-in regime requires individual class members to take positive steps to participate in the class action. If they do not come forward and opt into the class action, they will not be bound by nor benefit from the outcome of that litigation.
In the particular case, relating to an allegedly fraudulent online loan scheme, the court decided that the matter is well suited to an opt-out class action because the envisaged class is large and individual claims relatively small for instance when compared to the personal injuries sustained in the silicosis case. There was no evidence that any of the affected consumers had commenced legal proceedings against any of the respondents so it was reasonable to infer that there was little likelihood of independent litigation ensuing. The cost of individual litigation in relation to the sums intended to be recovered is likely to be high and would act as a deterrent to the pursuit of individual claims.
The interests of justice would in the circumstances favour the extension of collective litigation to all members of the class so as to render those consumer-based claims affordable. Leave to appeal against the certification of the class action was refused.
