Client Update: New class actions regime for NSW
3 November 2010
In brief: A draft Civil Procedure Amendment (Supreme Court Representative Proceedings) Bill and a discussion paper detailing a proposed new class actions regime for NSW have been released. Partner Ross Drinnan (view CV), Senior Associate Jenny Campbell and Lawyer Mark Hare report.
As we reported in our Client Update: New class action regime for NSW, in August 2010 the NSW Attorney General announced a proposal to introduce a new class actions regime. The Attorney General said that the proposed regime would be modelled on the existing regime for class actions in the Federal Court, but that some changes recommended by the 2009 Commonwealth Attorney-General's Department's Access to Justice Report and the Victorian Law Reform Commission's Civil Justice Review in 2008 might be adopted.
The proposed class action regime in the Civil Procedure Amendment (Supreme Court Representative Proceedings) Bill (the Draft Bill) is modelled on the federal class actions regime in Part IVA of the Federal Court of Australia Act 1976 (Cth). There are, however, three key differences:
- Limitations on the class: There is a provision to confirm that it is not inappropriate for representative proceedings to be brought merely because the represented class does not include all persons on whose behalf those proceedings might have been brought or where only those who have entered litigation funding arrangements are represented. This is consistent with the principle established by the decision of the Full Federal Court in the Multiplex class action in 2007.1
- Multiple defendants: For cases where there are multiple defendants, there is a provision to confirm that a representative proceeding can be commenced against several defendants even though not all group members have a claim against all defendants. This reverses the effect of the decision of the Full Federal Court in Philip Morris (Australia) Limited v Nixon.2
- Cy-pres powers: A provision granting the court power to order a 'cy-pres' remedy. This means that the court may order that unclaimed damages or damages that cannot be practicably distributed to group members be paid to a charity or other public interest beneficiary. This is a significant development and marks a departure from the compensatory principle that underscores general damages awards in class actions in Australia.
As we discussed in our Client Update, the majority of significant class actions over the past decade have been commenced in the Federal Court or the Supreme Court of Victoria. In our experience, this is because of perceived advantages for claimants under the rules applicable in those jurisdictions. Once the proposed NSW class actions regime is introduced, we expect more class actions to be commenced in the Supreme Court of NSW.
Comments on the Draft Bill can be made to the NSW Attorney General's Department until 10 November 2010.
- Multiplex Funds Management Limited v P Dawson Nominees Pty Limited  FCAFC 200.
-  FCA 229.
- Ross DrinnanPartner, Practice Leader, Disputes & Investigations,
Ph: +61 2 9230 4931
- Peter O'DonahooPartner,
Ph: +61 3 9613 8742
- Kim ReidPartner, Sector Leader, Banks & Financial Institutions,
Ph: +61 2 9230 4037
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