I INTRODUCTION TO THE CLASS ACTIONS FRAMEWORK
The Political Constitution of Colombia of 1991, in Article 88, conceived actions aimed at protecting collective interests and rights, and remedying harm, common to a group of people. These actions were developed by Law 472 of 1998 (Law 472), which divided them into 'popular actions' and class actions. In Colombia, popular actions seek to protect collective rights and class actions seek to protect the individual interests of 20 or more people harmed by the same act.
Since the enactment of this Law, over 20 years have elapsed during which the issues arising from these actions have become evident. Thus, while the initial years were characterised by high expectations generated by the Law's enactment and by a subsequent boom period, these were followed by abuses of these actions, particularly the highly publicised popular actions. In effect, too many people pursued the economic incentives incorporated by the Law in favour of those whose actions were successful. As a result of this experience, subsequent laws have led to a more settled case law, albeit one still in evolution.
In Law 472, through two mechanisms with apparently similar objectives but diametrically opposed in character, the Colombian legal system provides for the protection of collective rights and interests and the right to compensation for groups of people whose individual rights have been violated.
The first of these mechanisms is the popular action, whereby threats to collective interests are suppressed or prevented, or damage already caused is compensated; the second, the class action, seeks compensation for damage suffered by a number of people. Notably, in the context of individual damage or harm, reference is made to its effects on the patrimonial and extra-patrimonial assets of each individual concerned; inasmuch as class actions, inspired by the Anglo-Saxon model, pursue compensation of individual damage that affects 'large' groups of people, these effects will be brought to bear on the matter of the action.
When reference is made to collective damage, what is put forward for consideration is the present or future impact of the damage on an entire community. Collective damage, therefore, intangibly affects the quality of life of a whole conglomerate, and actions that seek to prevent or repair such damage must be exercised on behalf of the affected community through a popular action.
II THE YEAR IN REVIEW
As has already been noted, following the enactment of Law 472, this mechanism began to be used abusively and this situation led the legislature to suppress the economic incentives made available to successful claimants under the Law. The subsequent issuance of Law 1,425 of 2010 eliminated what represented for some a lucrative business in filing series of popular actions, thus leading to the achievement of more obviously laudable ends and controlling the exercise of the popular action mechanism.2
Even more important have been the legislative changes in matters of jurisdiction, particularly in the case of actions directed against a state entity, which are processed by the contentious-administrative courts. In consequence, when Law 472 came into effect, these actions were heard at first instance by the administrative courts of each judicial district and, at second instance, by the Council of State, the supreme court with jurisdiction over administrative issues. This ensured that, during the first years of the Law's validity, jurisprudential lines were established around the interpretation, application and scope of collective rights, a subject that until then had little development in Colombia. However, in 2006,3 the administrative courts commenced operation, so at first instance claims lodged as popular actions – and, in some cases, also class actions – were filed with these courts, and second-instance knowledge was transferred to the administrative courts of each district, making jurisprudence more diffuse.
In light of these developments, Law 1,285 of 20094 established a mechanism for a review by the Council of State of judgments and some injunctions handed down by the courts in matters within the contentious-administrative jurisdiction, in both popular and class actions. The review seeks to unify jurisprudence in this area and ensure effective protection of fundamental rights, as well as reviewing the legality of judgments in the administrative jurisdiction. However, this mechanism is not always effective because many of these procedures take years to decide, given the caseload to be resolved by the Council of State. In addition, the review is optional, not automatic (much less mandatory), and only proceeds when the judgment is proven to be contrary to what is normally decided by the courts in similar cases or when it is contrary to the established jurisprudence of the Council of State. This has led to few judgments being subject to review.5
Moreover, not all rulings in popular and class actions are subject to review. Rulings that are appealable before the Council of State once the action has been dealt with by the administrative courts, or decisions handed down by administrative judges, are not subject to review. Similarly, the judges of the Council of State do not review matters that generate new debates based on evidence or legality.
Furthermore, rulings in popular or class actions within the civil jurisdiction are also not subject to review and as a result jurisprudence in this area is not consistent.
Notably, although extraordinary appeals to the Supreme Court of Justice (the purpose of which is to unify jurisprudence in civil matters) are clearly applicable to class actions, according to the judgment of 20 September 2018 by the State Council, the applicability of such appeals in relation to popular actions is still subject to debate.
In this context, Article 338 of the General Procedural Code, apparently by mistake, established that the amount of compensation awarded following a conviction in a popular action should not be a consideration when the decision whether to allow the appeal is being made. Subsequently, Article 6 of Decree 1,736 of 2012 corrected the aforementioned Article, indicating that extraordinary appeal before the Supreme Court of Justice was ruled out for group actions exclusively, and did not in fact include popular actions. However, the ruling of 20 September 2018 issued by the State Council declared Article 6 of Decree 1,736 void, restoring Article 338 to its initial regulatory status. Thus, there is currently no certainty about whether extraordinary appeal is possible in relation to popular actions, but this question is likely to be decided by future decisions of the Supreme Court of Justice.
It is significant that, for more than 20 years, among the most relevant and frequently discussed issues in collective actions have been those related to the protection of the environment, including the ruling on the pollution of the Bogotá River in Judgment 01-479 of 25 August 2004; access and the services provided for the disabled in public places; access to and provision of domestic public services; and, finally, administrative principles and rules of conduct in state contracting.
Having already presented a general outline of the collective actions available in Colombia, this section deals with the corresponding procedures provided by law for these actions, and exposes some of the practical problems that have arisen during the years in which Law 472 has been applied.
i Types of action available
The Colombian legal system provides two types of collective action, the choice of which depends on the object of protection pursued. Thus, if what is intended is the safeguarding and protection of collective interests and rights,6 recourse should be made to a popular action; whereas if the aim is the defence of the rights and interests of a number of people (i.e., a group), the procedural method will be the class action. It follows therefore that the determining factor will be the damage caused.
Damage that intangibly affects the quality of life of an entire community is collective damage, and preventive or restorative action must be exercised on behalf of the entire affected community through a popular action. In contrast, group damage affects a number of victims who suffer individual personal damage that, when it touches a significant number of individuals, qualifies the creation of a group; or victims who suffer massive damage; and compensation in these cases can be claimed in the same judicial proceedings, through a class action. In the case of mass or group damage, each of the affected victims can seek compensation for their damage through an individual claim; however, owing to the scale of the damage, the law provides the class action as a theoretically more flexible procedural mechanism for the protection of the affected group's interests. The word 'theoretically' is used because, in practice, claimants do not always obtain the benefit of the flexibility that class actions are meant to provide.
Although the object of protection of the actions in question is different, nothing prevents the same event leading to the initiation of both types of action; for example, when fishermen fall ill or are deprived of the means of their livelihood because of the contamination of a river. It has already been mentioned that a common theme in popular actions is environmental damage, and in a case such as this protection of the healthy environment would be requested through a popular action, while the individual damage caused to the health and patrimony of the fishermen would be the object of a class action.
Notwithstanding this, and as we have argued previously,7 although Article 46 of Law 472 establishes the award of damages as the exclusive purpose of a class action, it would be absurd if, in the course of a class action for massive damage already caused, the judge were to find a latent threat of new individual damage or aggravation of the existing damage in the future and could not order the suppression of this threat on the grounds that the Law created the class action exclusively for indemnification purposes. A correct interpretation of this Article would understand class actions as being meant not only to collect compensation for individual damage already caused to the class, but also to suppress the threat of contingent damage to the property of individuals. Our interpretation has been accepted by national jurisprudence on several occasions.8
In addition to the nature of the damage, certain procedural elements allow the differentiation of popular actions from class actions, such as the time frame for initiation of the action, the individuals with standing to bring the action, the passive subject of the action, the precautionary measures available, the options for settlement agreements between the parties and their execution, and the judgment and its execution.
Elements of the actions
In addition to the damage to the collective interest, for a popular action to be admissible the defendant must be potentially liable for the damage. This means that the principles of civil liability are applicable to popular actions, because they imply the verification of a contingent or already caused collective harm, a fact attributable to the defendant and a causal link between one and the other.
As with popular actions, in class actions the defendant is required to be responsible. This implies the verification of civil liability, because without liability, compensation is not deemed appropriate. It follows from this that popular action proceedings will deal with either non-contractual civil liability or contractual civil liability, according to the elements of one or other liability regime.
ii Limitation periods
In terms of popular actions, the current procedural rule establishes that: 'The Popular Action may be promoted during the time that the threat or danger to the collective right and interest persists.'9 This implies that when the action involves a request that a latent or continuous threat of damage to collective or individual interests be eliminated, it is not extinguished by the passage of time. If repair or compensation of the damage already caused fails to prevent the production of new damage, the action will be subject to the terms prescribed for ordinary actions in the legal system.
In relation to class actions, Article 47 of Law 472 states that: 'Without prejudice to the individual action corresponding to the compensation for damage, the class action must be promoted within two years of the date on which the damage was caused or the injurious action causing it ceased.' This Article states that if two years have passed since the damage was caused or since the harmful action ceased and no class action has been commenced, each member of the group can still file an individual action, which will be valid in accordance with the terms of expiration and prescription applicable within the jurisdiction concerned.
In addition, in accordance with subparagraph (h) of Article 164(2) of Law 1,437 of 2011, there is an important exception to the previous expiration rule in administrative matters: 'If the damage caused to the group comes from an administrative act and the action is intended to void the act, the request must be submitted within the term of four months, counted from the day following the communication, notification, execution or publication of the administrative act.'
iii Commencing proceedings
With regard to legal standing in popular actions, Article 12 of Law 472 provides that every citizen and member of the community whose collective interests are harmed or threatened, whether a natural or a legal person, can file a popular action. Meanwhile, for class actions, Article 48 of Law 472 provides that every citizen whose particular interests have been violated can file a class action on behalf of a group of 20 or more victims harmed by the same act, for individual compensation of the damage caused.
It should also be noted that only one popular action at a time can be brought against a particular defendant in respect of a particular claim, under penalty of consequent litigation.
In relation to class actions, Article 48 of Law 472 establishes that any aggrieved party may initiate the action, but it also requires the plaintiff to identify a group of at least 20 affected people who meet the same conditions in the case. In this regard, it is important to specify that it is enough for a single member of the group to give power of attorney to initiate the action on behalf of the group, indicating in the lawsuit the criteria that allow the identification and delimitation of the affected class. This person must file the claims on behalf of the whole group, not just for those victims who have granted power of attorney.10
Once the action has been filed by at least one member of the group, the effects of the process extend to all members included in the class, with the sole exception of those affected who have decided to exclude themselves from the group expressly, and who retain the option to sue separately and individually.11 These conditions place the class action in Colombia in the category of an opt-out action.
Defining the class
Limiting the class is where the greatest disadvantages of class actions in Colombia lie because, once the plaintiff has been identified and presented in the lawsuit, there is no specific law establishing procedural requirements for the definitive identification of the class. It is also important to consider that, in practice, judges often ignore the criteria for identifying the class and end up ruling on the case without establishing a clear delimitation. In many cases, this situation leads to the emergence of doubts about the effects of the proceedings and the judgment in relation to possible new members of the class that did not grant power of attorney.
In our opinion, the identification of the class should be established by the judge before admitting the claim, based on the requisites contained in Article 53 of Law 472.
Delimitation of the class is important because failure to do so would make the distribution of compensation prior to the judgment unmanageable and would open up the question of compensation to discussion by people who had not become part of the process and whose membership in the class action could be debatable. The non-determination of the class in the case of an acquittal could also result in avoidance of the effects of res judicata. Finally, an inadequate delimitation of the class could impede the settlement process, as there would be no clarity about who should be called to the settlement and there would be insufficient guarantees to ensure closure of the event in a definitive manner for the defendant.
iv Procedural rules
Effects of class exclusion
The exclusion from the class of one of its members occurs after he or she states a desire to be excluded, and this must take place within a time limit of five days.
Interrogation of the parties
In 2006, in its capacity as the supreme court with jurisdiction over administrative issues, the Council of State issued a judgment stating that the interrogation of plaintiffs was incompatible with class actions. According to that court, the case at hand sought to clarify the common cause of the damages claimed by the group, which comprised both those alleged victims recognised as members of the class and alleged victims not yet recognised as members of the group.
This position was set aside for several years, during which interrogation of the parties was a common part of legal practice. However, in 2016, the Council of State issued a new decision disallowing interrogation of the plaintiffs of a class action, and definitively excluding interrogation of plaintiffs from administrative litigation.
In contrast, the Supreme Court of Civil Justice has established no jurisprudence regarding the interrogation of the parties. Therefore, interrogation of the members of the class remains a common practice in litigation within the civil jurisdiction.
Finally, it should also be noted that interrogation of the parties – as a means of proof – is not specifically excluded from class actions statutorily. In fact, since class actions seek to redress the individual harm suffered by the members of the class, interrogation is an adequate means to demonstrate whether the damage concerned has affected each member of the group individually.
Effects of the judgment
The final judgment in a class action has res judicata effects against all those involved, and it benefits all those who claim within 20 days of the publication of the judgment, except those who were expressly excluded from the class at the beginning of the action and are therefore not affected by the decision.
Similarly, an acquittal may jeopardise the rights of all the members of the class, except those who were expressly excluded in a timely manner. Additionally, a possible violation of the right of defence arises for those who did not expressly exclude themselves from the class but did not become part of the class action either, because membership of the class results in their being linked with an unfavourable ruling in a lawsuit in which they did not even participate.
Both popular and class actions are subject to the jurisdiction rules to determine which judge is competent. The Colombian legal system contemplates a civil jurisdiction and a contentious-administrative jurisdiction. In simplified terms, it could be said that the jurisdiction will depend on whether the litigation concerns a public function or a state entity. Therefore, collective actions will be brought before civil judges or administrative judges, depending on which jurisdiction is called to review the matter in dispute and the parties involved.
The procedural rules governing collective actions are enshrined in Title III of Law 472. In the event of regulatory gap, Article 68 in Title III provides for referral to the Code of Civil Procedure – since replaced by the General Procedural Code – to govern conflicts in the sphere of private law.
For collective actions brought in the contentious-administrative jurisdiction, some jurisprudence and legal doctrine have held that popular and class actions must be subject to the residual rules of the Contentious-Administrative Code.12 The plurality of these laws can create confusion regarding the procedural rules applicable to a collective action; this may end up affecting the right of defence of the parties or may bring about legal uncertainty.
v Damages and costs
For both popular and class actions, the legal system permits the parties to agree with their lawyers the fees that will be charged for the representation of their interests in the process. It must be specified that, in Colombia, contingency fee agreements are permitted, as are other remuneration mechanisms for services whose agreement and content are lawful. There is, therefore, no special regulation or prohibition regarding the remuneration of the trial lawyer.
Anyone can file a popular action without the need for the presence of a qualified lawyer, so interested parties can access the courts directly with the intention of protecting the interests of the community.
As a rule, class actions in Colombia are predicated on the award of monetary compensation in favour of the plaintiff. In these actions, the damage that can be compensated corresponds to the damage that the plaintiff tries to prove in the process, in relation both to the damage of the group and to the individual damage of each member of the class that becomes part of the proceedings. Traditionally, the award of damages has been governed by the limits on compensation for non-pecuniary damage recognised in case law and applicable to liability proceedings. As far as damage to property is concerned, compensation for the damage that can be proven within the proceedings will be recognised, if every element of tort law has been proven.
Compensation imposed in the class action judgment
The final judgment in the class action must stipulate the amount of collective compensation and the weighted sum of the individual compensation of the members of the class. The sum corresponding to the compensation must be delivered to the Fund for the Defence of Rights and Collective Interests, which will handle the distribution of the resources to the claimants who present themselves and prove their class member status. This fund is administered by the Ombudsman to guarantee the interests of the members of the class and to ensure suitable adequate management of the resources.
Law 472 anticipates the parties in collective actions reaching an agreement to settle the matter before the collective action begins.
In the case of a popular action, Article 27 of Law 472 orders the holding of a compliance hearing, which is decreed ex officio by the judge, and which the parties are obliged to attend to sign a compliance agreement. In the compliance agreement, the parties discuss measures to protect the collective right or interest that has been threatened by the defendant and, if possible, accept the agreement. If agreement is reached, the agreement is then signed and the judge reviews it and approves it in a judgment. If the trial judge considers the signed agreement to be incompatible with protection of the collective right, or that it does not comply with current regulations, or that for any other reason it is not appropriate, the agreement can also be rejected in the judgment.
Finally, if the compliance agreement is approved, it becomes res judicata. In special cases, such as environmental damage owing to contamination, the agreement may be problematic because it can close the door to future actions against a defendant who continues polluting. However, the Constitutional Court has anticipated this risk by excluding res judicata effects in cases where the collective assets remain or will potentially be at risk again as a result of new conduct by the defendant.
With regard to class actions, according to the applicable regulations, early termination of the proceedings can be achieved through a settlement hearing or a transaction between the parties and, according to the regulations of the General Procedural Code, this also could be said to conclude the class action lawsuit. Regarding each of the mechanisms for early termination of the proceedings, the following are of note.
A settlement can be agreed between the parties during the settlement hearing provided by law for class actions. The settlement agreement signed by the parties is treated as a judgment and has res judicata effects. Once the agreement is signed, the judge will order its publication in national journals, so that the members of the class who did not become part of the proceedings may present themselves to prove their eligibility and claim the corresponding weighted compensation.
Although Law 472 makes no provision regarding the admissibility of the option of transaction and withdrawal from the class action, there is nothing to prevent the early termination mechanisms of the proceedings from being applicable by reference to the General Procedural Code. In relation to the transaction, we believe that it would have to be governed by the rules provided in law regarding settlements, except that there is no mandatory settlement hearing. There is also doubt as to whether, once the transaction contract is concluded, it must be approved by the presiding judge, because the law is silent on this.
Concerning withdrawal from the action, also applied by reference to the General Procedural Code, many doubts arise about prematurely ending a class action, especially in terms of its effects on those members of the class not present but who would be affected by what is decided in the proceedings. Finally, to expand on what was mentioned previously, inadequate identification of the class generates conflicts in practice, because the lack of clarity as to the potential claimants or members of the class makes settlement impossible.
IV CROSS-BORDER ISSUES
In principle, Colombian law does not prohibit foreign claimants from bringing a popular action or adhering to a class action. However, this is rare in practice.
In cases in which issues of international law are discussed, Colombian law does not establish restrictions on who can bring class actions in other jurisdictions. Cases that are brought before the judges of foreign legal systems must be governed by the applicable law of the sovereign state in question.
Although in practice the application of foreign judgments in class actions is unlikely, for a foreign judgment in a class action to have effects in Colombia, Colombian law requires the application of the appropriate exequatur, together with completion of its requisites.
The foreign decision must:
- not refer to property rights constituted in assets that were in Colombian territory at the time of initiation of the proceedings in which the sentence was issued;
- not oppose Colombian laws or provisions of public order, except procedural ones;
- be enforceable in accordance with the law of the country of origin and presented in a duly completed copy;
- not fall exclusively on a matter reserved to Colombian judges;
- not concern an existing process or enforceable judgment by Colombian judges on the same matter; and
- meet the exequatur requirements.
V OUTLOOK AND CONCLUSIONS
The legal system does not clearly establish the criteria for establishing the class in class actions, nor does it contain clear procedural rules for delimitation of the class, which in practice creates difficulties regarding compensation, the conclusion of settlements, and any res judicata effects.
Furthermore, judgments are imprecise and insufficient if, after conviction, a significant number of people are affected, in which case individual compensation decreases significantly.
The absence of clear rules to determine the class means that the action largely loses its effectiveness, since, as claims evolve, lawsuits are filed by small groups of injured parties, which leads to enormous uncertainty regarding the res judicata effects of the first lawsuit.
Finally, for as long as there continue to be no clear mechanisms to identify the class in space and time, class actions will not guarantee the victims damages of any significance.
1 Javier Tamayo Jaramillo is the founding partner and director of Tamayo Jaramillo & Asociados.
2 In this regard, the Superior Council of the Judiciary, the body in charge of, inter alia, compiling the statistics on popular actions, reported that following the elimination of the economic incentive, popular actions decreased by approximately 60 per cent. See Manjarrés Bravo, Patricia Victoria. ¿Se han transformado las acciones populares con ocasión de los cambios normativos y jurisprudenciales ocurridos en el periodo 2006–2012? Universidad del Rosario, Bogotá, 2013.
3 Agreement No. PSAA06-3345 of 13 March 2006 and of 9 May 2006, of the Administrative Chamber of the Superior Council of the Judiciary.
4 Law 1,285 of 2009, reforming Law 270 of 1996 on the Statutory Administration of Justice.
5 Hernández Nárvaez, Adriana and Ducuara Granados, Janefriend Carolina. Revisión Eventual de las Acciones Populares y de Grupo. Last accessed on 10 April 2020, at http://repository.unimilitar.edu.co/bitstream/10654/9226/2/HernandezNarvaezAdriana2012.pdf.
6 Article 4 of Law 472 of 1998 makes a non-exhaustive statement of collective rights and interests. The generosity of the list notwithstanding, there is nothing to prevent a popular action from seeking to safeguard a collective right not included in the provision. The Article states the following:
Article 4. Rights and collective interests are collective rights and interests, among others, related to:
a the enjoyment of a healthy environment, in accordance with the provisions of the Constitution, the law and regulatory provisions;
b administrative morality;
c the existence of ecological balance and the rational management and use of natural resources to ensure their sustainable development, conservation, restoration or replacement, the conservation of animal and plant species, the protection of areas of special ecological importance, the ecosystems located in the border areas, and other interests of the community related to the preservation and restoration of the environment;
d the enjoyment of public space and the use and defence of public property;
e the defence of public patrimony;
f the defence of the nation's cultural heritage;
g public safety and health;
h access to a service infrastructure that guarantees public health;
i free economic competition;
j access to public services and that their provision is efficient and timely;
k the prohibition of the manufacture, importation, possession, use of chemical, biological and nuclear, as well as the introduction into the national territory of nuclear or toxic waste;
l the right to safety and prevention of technically foreseeable disasters;
m the construction of buildings, buildings and urban developments respecting legal provisions, in an orderly manner, and giving prevalence to the benefit of the quality of life of the inhabitants; and
n the rights of consumers and users.
In addition, collective rights and interests are defined as such in the Constitution, ordinary laws and international law treaties signed by Colombia. The rights and interests set out in this Article are defined by and subject to the regulations currently in force or those issued after the effective date of this Law.
7 Tamayo Jaramillo, Javier. Las Acciones Populares y de Grupo en la Responsabilidad Civil, first edition, pages 185–187, Baker McKenzie, Diké, 2001.
8 Judgment of 24 August 2000. Administrative Tribunal of Cundinamarca. File AG-99-001. Class action, plaintiff Marcos Yesid García, against the Mayor's Office of Bogotá. In the judgment of 24 August 2000, decided by the Administrative Court of Cundinamarca, accepting the claims of some houseowners, whose properties were in danger of collapsing if no corrective measures were taken. The Court ordered: '[t]ake the necessary measures and perform the corrective works of drainage and containment sufficient to stop the thrusts of the land that come from the active landslide of the neighbourhoods of Granada Sur and Montebello, taking into account the recommendations of Ingeominas'. The Superior Court of Popayán issued a ruling along the same lines in its judgment of 8 October 2002, where it established 'that the contingent damage in the case analysed was evident and, therefore, there was no doubt as to the right entitling the consumers to obtain a product in which the possibility of error or failure of production and harm to the consumer was reduced to the greatest extent possible'. The arguments presented by the Superior Court of Popayán, Civil Chamber, referred to a reasonable interpretation of the provisions on popular actions in defence of consumers, and concluded that there was contingent damage that could be mitigated through such action. Judgment 8 October 2002. Mario Sagid Mosquera López v. Panamco Colombia SA.
9 Article 11, Expiration, Law 472 of 1998.
10 Colombian Constitutional Court. Judgment C-116-08 of 13 February 2008, PJ. Dr Rodrigo Escobar Gil.
11 Article 56, Law 472 of 1998.
12 Law 1,437 of 2011.