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Author: Georg E. Kodek

I. Overview

The Austrian Code of Civil Procedure does not contain special rules for collective redress. However, there are a number of procedural devices, which, to a certain extent, can be utilized to handle mass litigation. Those instruments can be classified into two general categories, traditional procedures and the so-called 'Austrian model of group litigation', whose main features will be described shortly.

Apart from individual actions, traditional multi-party procedures in Austria include several devices such as; joinder, consolidation of cases, test cases and the appointment of a curator. Joinder allows several plaintiffs to join forces against one or more defendants. Also, the courts have a discretion to consolidate cases if this is in the interest of justice (sections 11 et seq, section 187 Austrian Code of Civil Procedure). Occasionally, potential litigants agree to file solely one case designed to resolve a number of similar controversies between the parties or to await the outcome of an already pending case (test case). Further, several statutes authorize the appointment of a curator in mass proceedings. Whereas in most cases this is for purposes of service only, an 1874 statute authorizes the appointment of a curator representing investors in court in cases involving "Teilschuldverschreibungen" (partial debentures). [For further details, see below II. Traditional multiparty practice in Austria]

As stated earlier, in addition to these traditional devices, Austrian practice has developed a form of group litigation based on a combination of joinder of claims and litigation finance ('Austrian model of group litigation'). Under this scheme potential claimants assign their claims to an association (typically a consumer association) which then files a complaint on its own behalf. Assembling a large number of claimants in this fashion enables the association to avail itself of commercial litigation finance and enables the claimant to pursue his or her claim without any risk. This procedure has been successfully used in a number of mass cases, particularly those against banks for charging excessive interest rates and in lawsuits concerning poor investment advice. [For further details, see below III. General Collective Redress Mechanisms: The 'Austrian model of group litigation']

Regarding their scope of application, all of these mechanisms mentioned above (with the exception of the curator under the 1874 statute) are not restricted to a particular area of the law. Nevertheless, in practice, mass claims are mostly found in tort cases and in claims for damages in connection with false investment advice.

Further, there are no restrictions as to whom these procedures are available for. However, under the 'Austrian model of group litigation', consumer claims are more likely to be pursued because the assignees bringing the cases are mostly consumer organizations.

From a procedural viewpoint, all these mechanisms fit into traditional civil procedure, either by combining several parties, or several lawsuits, or by "collectivizing" mass claims by way of assignment to an institution, which then proceeds as a single claimant.

There is no certification process in the technical sense of the word but a peculiarity may be found under the 'Austrian model of group litigation' mechanism, where the Austrian Supreme Court has established certain requirements to permit raising several claims in one action (for further details, see below III. General Collective Redress Mechanism: the 'Austrian model of group litigation'.

In the opt- in versus opt- out debate, Austria follows the opt- in model. Obviously, this means that the scope of res judicata of the procedures is limited to the parties who actually participated in the proceeding. Other members of the respective group who did not take part in it are not bound by the outcome. In addition, these procedural devices are not restricted to Austrian claimants, so there are no constraints as to the participation of foreign claimants.

Since all of the measures described above fit into the framework of traditional civil procedure, and since Austrian law currently only provides for proceedings in which the judgment affects only the respective members of the class who actually took part in the proceeding ('opt-in'), there are no restrictions as to the available remedies. In most actions claimants ask for monetary compensation, although a declaratory judgment would also be possible. For certain declaratory judgments several institutions also have standing to bring suit, particularly under the Unfair Contract Terms Directive.

As to the costs, Austria has a "loser pays" rule. In recent years commercial litigation finance became increasingly important. The 'Austrian model of group litigation' has the advantage of yielding a sufficiently high amount of controversy which enables the claimants to use commercial litigation finance. The fee for this litigation finance will generally be between 30 and 40 percent of the overall amount of claims.

Interesting reform plans have been suggested but they have not succeeded. In light of an increase in mass litigation, a draft for a group procedure has been promulgated by the Austrian Ministry of Justice in 2007. Under this draft, a new group proceeding will be introduced for cases involving three or more claimants, and a large number of (probably more than 50) claims and similar questions of law and fact. However, a claimant is always free to pursue his claims as an individual action instead of participating in the group proceeding. The court decides on all common questions of fact and law by judgment. Any questions not resolved in the group proceeding have to be determined in individual lawsuits. The draft was met with severe resistance by the Chamber of Commerce and, consequently, the Conservative Party. Given the present political situation (a coalition government of Social Democrats and Conservatives), implementation of the reform is unlikely in the near future.