June 1, 2018
Mass. R. Civ. P. 23 outlines the requirements for bringing and maintaining a class action law suit. Such suits often end with residual funds,that is, funds that couldn’t be distributed to the plaintiffs. Up until 2008, Rule 23 did not provide direction with respect to how such funds should be disbursed.
The Supreme Judicial Court recently adopted a second amendment to Rule 23. Before judgment is entered or a compromise approved regarding the disposition of residual funds, the plaintiffs must notify the Massachusetts IOLTA Committee. The Committee is then authorized to make a limited appearance to be heard on whether it ought to be a recipient of any of the residual funds.
Pursuant to the amended Rule 23, judges and counsel can recommend that residual funds be put to their “next best” use for the aggregate, indirect, prospective benefit of the class members. Where funds cannot be distributed to all members of the class, counsel can suggest that these funds be distributed to legal services or the MA IOLTA program.
Legal services programs promote access to the civil justice system for low-income residents of the Commonwealth. The amendment is an important source of funding to assist low-income individuals and families in the Commonwealth with critical civil legal needs such as those involving shelter, sustenance, health and safety.
For more information about directing residual funds to sustain legal aid in Massachusetts, download a copy of our booklet describing the implementation of this Rule or call us at 617-723-9093.