Eurocrats feature more rarely in the Gazette than their power over the UK's legal system might warrant. It would be fair to say that some of the most important legislative changes in recent years have emanated from Europe – the Human Rights Act, for example, is barely out of the news.

This year will see several EU-led legal initiatives that could have far-reaching implications for the UK's legal consumers, from those involved in group claims to those trying to reclaim money in small cross-border disputes. Diana Wallis will have a hand in them all.

Wallis was elected vice-president of the European Parliament (EP) in January 2007 – the first woman to reach such heights in two decades. Co-ordinator for the European Parliament's Committee on Legal Affairs and the Internal Market, she is embedded in the legal future she and fellow MEPs are trying to create. She has written or worked on key reports for the EP, including those on: the 2007 EU regulation on the law applicable to non-contractual obligations (otherwise known as Rome II); maintenance obligations; European contract law; and getting better access to justice in civil claims. Wallis is also involved in the push for direct democracy, and is a board member of a direct democracy think-tank. She has a keen eye to collective redress – ‘putting power into the hands of individuals’, as she puts it.

Putting power into the hands of individuals, enabling direct democracy – it certainly does not sound like the EU that people such as Tony Benn, for example, think exists behind the Brussels façade. But then Wallis is fairly unusual and, as a Lib Dem member of the EP, she is at least an elected Eurocrat. And unlike a fair number of top politicians in Britain, she did not start out as a barrister, business owner or PR consultant – she was a solicitor. Born in 1954 in Hertfordshire, she qualified in 1983, specialising in European commercial litigation. She became MEP for Yorkshire and the Humber in 1999.

People’s politician

A commercial litigation background, without deriding the area, does not make one think of devotion to the causes of the common man. But Wallis also did matrimonial work, which will give anyone a grounding in human nature. She went into a City litigation practice where she could use her languages – she is fluent in French and German, the two key Euro languages.

She says her work as a solicitor was great preparation for a political career like hers. Most lawyers will say the law is all about people – and so is politics. Solicitors are eminently suited to politics, she says, perhaps more so than barristers. ‘At the end of the day clients are people. It’s not always the case, but it’s the solicitor who has more of a relationship with the client.

‘People are often very sceptical about politicians, [but] if you come to politics caring about people’s backgrounds and about representing people, you can see a lot of synergies between being a solicitor and, I would hope, being a caring and successful politician.'

Of course, the problem with being a politician in Europe is that there are now many member states all trying to go their own way within the legal parameters of the directives. The coalface job of making the European legal landscape look right from all directions is that of the judge. But some judges have some way to go to make that process work.

Judicial difficulties

Wallis got plenary support for her report on the Role of the National Judge in the European Judicial System back in July, saying at the time: ‘There is a general feeling that European law is rather distant and too complex. National judges are not given the time or the means to overcome this complexity. This must be counteracted.’ In essence, the report said that national judges are not always properly equipped ‘legally and linguistically to deal with the challenges of an enlarged EU legal order’.

‘Europe tries, despite all you read in the British press, not to be heavy-handed,’ she says now. ‘So there’s a lot of leeway there. That leeway often leads to inconsistencies and unevenness of implementation, and then it comes down to people at the sharp end – practitioners and, more importantly, the judges who have to interpret and use European law. And how knowledgeable are our judges of their position as the first judge of European law? Because that’s what they are.’

Brussels has constructed a system of conflict of laws, rather than full European harmonisation of laws. In cross-border cases, therefore, there are clear rules about which nation’s law applies, but that means you need a national judge who has ‘some appreciation of foreign legal systems’ within the Union, she says. ‘We’re asking a lot of our judges, frankly.’

Judges in the newest EU member states ‘have a far greater awareness’ of their position as arbiters of EU law because of how recently they have gone through the enlargement process. This has greater consequences for claimants in the common law system because parties have to raise issues themselves, she says, whereas in most continental systems the judge has a more proactive role.

This takes us for a moment to a surprising area – ‘selling’ the common law system. Common law systems might force parties to be proactive, but there are advantages – advantages Wallis believes should have been better ‘sold’ to the newest EU members who were coming fresh to a post-Eastern bloc legal set-up.

She says Germany has been very active in promoting its civil code in the enlargement countries, and she is surprised how many of the enlargement countries have taken it. ‘Wouldn’t it have been better if there had been more activity from British lawyers and the British government pushing the common law system?’ she asks.

Learning languages

For judges, though, more education and international exchanges are needed, and judges in the UK will have to learn more languages. This isn’t to say all our judges are failing the Euro-test, she says. ‘But every judge is the first judge of European law. If they get a real first question that needs referring, they need to feel comfortable referring it to the ECJ.' Europe has to make sure it provides the lifetime training that could be available, she says – providing judges with the ability to make European contacts and providing online much of the information about European law.

So many Euro-law issues could be addressed through the correct application of technology, and Wallis’s wish-list for judges really could be dealt with via a decent knowledge management approach – but we would probably want it built by a City law firm, not the government.

Wallis hopes to produce a draft report on e-justice for the EU in October, focusing on making sure EU states do not create systems that cannot communicate – totally negating their effectiveness at delivering justice across European borders. But this is not just about IT systems. When the new European Payment Order (EPO) and European Small Claims Procedure (ESCP) are introduced, at the end of this year and the beginning of 2009 respectively, they should have forms carefully designed to be used anywhere in the EU in terms of the language and content, she says. But they are also designed to be used, ultimately, online.

To do this, though, the IT framework that will let consumers litigate and claim across EU borders needs to be laid out more definitively by Brussels – but this will be hard to do. ‘There is a hesitancy to let Europe take a role there, but without that we are never going to get there. It’s a constant refrain of mine – we’ve created an internal market, we encourage everybody to move about, but we’ve never produced a justice system that lives up to it and plays to it, and we desperately need it. And I hope we'll get it in the next mandate in 2009 – a justice commissioner with a vision of civil justice that equates to the internal market.'

The whole of Europe was pulled away from a drive towards ‘e-justice’, just as it was pulled away from a lot of ‘soft’ issues, following the 11 September terrorist attacks in the US and the launch of the ‘war on terror’, she says. Now at last the EU is returning to the agenda she encountered when she was elected – ‘European civil justice, mediation, online, internal markets and e-commerce’.

Brussels passed its mediation directive in April, and member states have three years from then to implement it. It should help make final awards for cross-border mediation enforceable, among other things, such as limitation. Now, she says, we have to get down to the fine detail – how will justice for the small players in litigation be delivered? The EPO, she says, is 'getting to be a good solution that can be used online'. The EPO may well be a good way for people to make sure they get paid, wherever their claim is, but it will not help UK residents filing small claims to get the same payouts they would at home – the maximum claimable value under the new ESCP is just €2,000. In sterling terms this is thousands less than could be claimed through a small claims court here. So, while Wallis and her colleagues are helping all Europeans get access to small-scale, cross-border redress, the value of that redress is distinctly unequal.

This was a compromise, she says, and she does not look very happy when she says it. ‘We have to understand that what seems like not a large amount to us is huge to some of the new member states. You have to start somewhere. We did try to find a way in which in some countries you could have had a higher level, but it just wouldn’t work in the end.’

Collective redress

From individuals seeking access to justice, the next logical point to broach is that of collective redress. Though we are unlikely to see anything like the US class action in the near future, she says, developments in collective redress must deliver power to the people through the medium of the courts. A particular bete noire of hers is the Equitable Life affair, which saw more than a million people lose up to half of their savings, a regulatory disaster which hit the headlines again this year when Whitehall stepped in to help Northern Rock. Why, asked those who lost money in Equitable Life, isn't the government helping them as well?

‘It’s still incredibly expensive for an individual to take a cross-border action for a small amount of money. Very often, the things that affect one consumer will affect many consumers in different countries, and the most obvious example that I've lived through would be the failure of Equitable Life. Because of the European nature of the legislation under which they operated, there were also losers in Germany, Ireland and elsewhere, who have found it incredibly difficult to get any satisfaction. If there had been some kind of collective instrument available, everybody could have gone together.

‘We’re also faced with the conundrum that, in one or two cases in Europe recently – Parmalat is one – you've seen European consumers going off and using the US courts, which is, again, not very attractive. I'd much rather we had something home-grown. Also, if government is feeling short of money, it’s a way of assisting the regulatory process. And to me, as a liberal, it’s a good liberal idea.’

So what sort of system might we have? Initially, she says, one limited to small consumer issues. ‘Some people are talking about a European ombudsman who decides on the merits with which claims go forward, but at the other end of the spectrum you’ve got a full-blown legal vision of collective redress, where you use the courts in the normal way and the judges are the arbiters as to what is meritorious. But many of the European countries are very nervous of this. Some will question whether there is a legal basis to introduce such a system across Europe.’

Leading the way

Finally, we arrive at an issue where the UK can lead the way. There is a lot of work going on in the UK on collective redress, she says, and studies here point to an opt-out system being more appropriate – and if we move with that option, ‘I think, for once, the UK might actually push Europe’. This is, coincidentally, due to the set-up UK judges need to remember – any judgment given in any court in Europe is enforceable in other courts in Europe.

This is all very well, but how do we make collective redress work better? Class actions work so well in the US because it is an opt-out system and damages can prove highly lucrative. Surely there need to be good financial incentives for firms and claimants to make this happen, beyond changing to an opt-out model?

‘I don’t think we should have punitive damages,’ says Wallis. ‘I don’t think with any Europe-wide system you’d ever pass a system like that. It would have to be a compensatory system. [But] as long as we keep our loser-pays principle, that will assuage those who fear a US-style system. But we still have to answer the question "how will this be funded?"'

This is the issue at hand, though. It may not seem worth it to those who will work the claims. ‘We’re at the beginning of this journey and there’s hysteria on some sides, but we’ve got to look at it all very carefully. What I’d hate to see is the thing get strangled at birth.’

This is a vital route to redress for the average European citizen that Wallis and her colleagues are trying hard to deliver, she says.

She says much the same about trying to pull together contract law across Europe. Contrary to Eurosceptic speculation, she insists, people are not secretly working to turn our legal system into a version of European civil code. ‘But rather than historically picking at a bit here and a bit there, if somewhere you’ve got a perspective of what the whole thing looks like you might at least make a system that works better, a structure that works better. Even if that structure is only talked about in academic circles, even that’s helpful, because it allows us to have a conversation across Europe on legal issues on the same basis.’

Wallis can jump from collective redress to contract law and the capabilities of national judges with little problem, but she manages to pull the subjects round to their impacts on citizens every time. Whether this is a politician’s knack matters less than the results: she genuinely seems to want to make European law work better for people. I ask if she could ever, in that case, see citizens using collective powers to correct the democratic deficit that some say exists in places like the UK.

It’s fun to think about, she says, but there is a grain of possibility in there too, with Equitable Life as an example. ‘We tend to think of markets as being distant and corporate, but at the end of the day it’s ordinary people with their savings and their pensions whose lives are wrecked. We need to be able to produce something that can get to grips with that. It certainly seems that the regulatory regimes were not sufficient [regarding Equitable Life], and so let’s deliver that possibility into the hands of our citizens. Then maybe you’ll get some answers.

‘I know people get frightened about litigation culture, but if that stops people misbehaving or makes them think twice about how they use other people’s money, maybe that’s a good thing.’