Inner House rules group action against Nissan can proceed

The appeal concerned legal action against Nissan and Renault over claims they illegally manipulated diesel emissions tests to ensure that their vehicles complied with UK statutory requirements.

Around 8,500 people claim to have suffered loss as a result of the alleged fraudulent behaviour, with the respondent in the case, Joseph Mackay, seeking to raise group proceedings on their behalf.

Permission was granted for the group action to go ahead, however the Nissan companies appealed to the Inner House of the Court of Session to challenge that decision.

The Lord President, Lord Pentland, sitting with Lady Wise and Lord Clark, refused the appeal, allowing the group action to proceed.

In the group proceedings application, the respondent claims that Nissan and Renault fraudulently misled group members by asserting that their vehicles and diesel engines had been tested and complied with required emission levels in the EU and UK.

The companies are alleged to have installed prohibited defeat devices to their vehicles during testing to limit the output of nitrogen oxide emissions. Each member of the group claims that such a device was fitted in a vehicle in which they had a financial interest, and that they suffered a loss when the allegations came to light.

In order to begin group proceedings in Scotland, two initial applications must be made to the court: an application to appoint a representative party and an application for permission to bring the proposed group proceedings. Two such applications came before the Outer House of the Court of Session and were granted.

The appeal to the Inner House challenged those decisions.

The appellants contended that Mr Mackay failed to demonstrate that he was an appropriate person to be appointed as the representative party.

They also claimed that permission should not have been granted for the group action because it had not been shown that it would be more efficient for the claims to be brought as a group action rather than individually; it had not been shown that the proceedings had any real prospect of success; and it had not been shown that the proceedings raised the same, similar or related issues.

The Inner House found, however, that there was “no basis” for interfering with the decision of the Outer House to grant Mr Mackay’s appointment, adding that this point of appeal was incompetent.

The court also found that there was “no justification” for interfering in the decision of the Outer House to grant permission for the proceedings. The court’s decision states that the legislation allowing group proceedings does not require the claims to be identical, merely similar or related to each other.

It also states that the case had real prospects of success, and that there was no doubt that it would be more efficient for the claims to be brought collectively rather than individually. 

The appeal was therefore refused and the group proceedings allowed to progress.