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Court of Appeal has jurisdiction to consider refusal by tribunal of a collective proceedings order

Consumers are one step closer to the determination of a multi-billion pound class action against Mastercard over anti-competitive card charges, as the Court of Appeal decides that it does have jurisdiction to hear and determine the appeal.

Background of the case

In mid-2016, Walter Merricks (former chief Financial Ombudsman) applied for a collective proceedings order (“CPO”) permitting him to bring a class action under the Consumer Rights Act 2015 (“the CRA”), on behalf of UK consumers (Case 1266/7/7/16 Walter Hugh Merricks CBE v MasterCard Inc and Others).

Merricks alleged that the interchange fees applied by MasterCard to cross border transactions between 1992 and 2008 (which the EC had already decided were too high and anti-competitive) resulted in increased costs to UK consumers. He claimed £19 billion. Merricks' key challenge was to establish the way in which damages should be distributed to the class members.

In July 2017, the Competition Appeal Tribunal (“the Tribunal”) decided that the claim was not suitable for collective proceedings because Merricks had not provided sufficient evidence with which to support his proposed method of calculating the damages that would be awarded to each class member. The governing principle for breach of competition law is restoration and the Tribunal was not convinced that Merricks could achieve this resolution

An appeal under the Tribunal's collective actions is new, untested, territory. On the basis that the jurisdiction was unclear as to whether an appeal would be heard by the Court of Appeal or the Administrative Court (for judicial review), Merricks sought permission from the Court of Appeal, but then also issued proceedings seeking judicial review. The recent Court of Appeal decision deals with this preliminary issue about jurisdiction.

The procedural dilemma

As a result of the CRA, it is now possible to bring collective proceedings for damages and other relief in the Tribunal, but in order to do so, a proposed representative (Merrick in this case) must obtain a CPO.

Certain eligibility conditions must be met for the Court to grant a CPO, to ensure that claims which would otherwise be brought by individuals are suitable for continuing to trial on a collective basis.

In its decision in July 2017, the Tribunal determined that such claims were not suitable to be brought in collective proceedings and therefore a CPO was not granted.

The problem is that the CRA is not clear regarding the correct avenue to challenge the Tribunal’s decision, and the absence of case law (given the newness of the legislation) meant that the Appeal Court would need to determine the correct jurisdiction as a preliminary issue.

The CRA states that the Court of Appeal has the jurisdiction to consider an appeal on a point of law from a decision by the Tribunal in collective proceedings but this is limited to (amongst other things which are irrelevant in this case) ‘a decision as to an award of damages’.   

The question became one of whether a decision ‘as to an award of damages’ includes a decision to grant a CPO. If a CPO is granted, collective proceedings continue. If it is denied, individual claimants still have the option to continue proceedings in their own name(s).

Mastercard argued that, because of the ability for individual claims to continue following the refusal of a CPO, then the claim to ‘an award of damages’ is not in fact barred because a potential claim remains intact. The Tribunal itself had previously also suggested that had the legislature intended for the refusal of a CPO to be appealable, it would have included express provision within the CRA.

In contrast, Merrick argued that the words ‘as to the award for damages’ are merely descriptive. The CRA only explicitly excludes an appeal against any Tribunal decision relating to collective proceedings on costs or expenses, but in no other circumstances. Therefore, the Court does have jurisdiction to consider the Tribunal’s decision.

Furthermore, because the Tribunal decision barred the aggregate award for damages and that was the only relief sought by Merrick (which was unobtainable any other way) this causes it to be a decision ‘as to the award of damages’.

In coming to its decision on jurisdiction, the Court considered the case of Enron Coal Services Ltd (in liquidation) v English Welsh & Scottish Railway Ltd [2009] EWCA Civ 647, being possibly the closest example of a similar type of challenge to its jurisdiction. Enron related to a refusal by the Tribunal to strike out part of a claim. The conclusion was that a strike out decision (whether positive or negative) addresses the viability of the claim and as a result must be a decision ‘as to the award of damages’. The Enron case did not, however, consider whether this extended to any interlocutory decision. 

This case is different to Enron, in that the refusal of a CPO doesn’t go to the arguability of the claim itself. However, the Court decided in this case that the refusal of the CPO by the Tribunal is a decision as to the award of damages on the basis that it not only prevents the unique remedy of an entitlement to an aggregate award of damages in collective proceedings, but also “a refusal of a CPO is likely to prevent individual members of the represented class who have suffered loss from obtaining any compensation” (as they are unlikely to bring a claim themselves). On that basis, it does become the end of the road for this type of class action and therefore a decision ‘as to the award of damages’.


This decision provides greater clarity as to whether, under the CRA, the Court of Appeal has jurisdiction to consider a Tribunal’s refusal to grant a CPO. Greater clarity should benefit all parties in future cases, as it serves to remove the unnecessary and sometimes costly burden of having to interpret the law again on this issue. We will update further following the appeal itself.

Contributor: Lynsey Robinson

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