Interlocutory Decisions
Failure to pay security for costs
In January 2024, Federal Court Justice Markovic dismissed the Hogs’ Breath Café Class Action due to the failure of the Lead Applicants to pay over $1 million in security for costs they had been ordered to pay in February 2022. Her Honour cited the significant delay on the part of the Lead Applicants to make that payment, along with their ongoing challenges in securing appropriate funding for the class action and the adverse publicity they were suffering as a result of it, to justify dismissal of the proceeding. Her Honour refrained from making the order sought by the Respondents that the Applicants be barred from commencing a new proceeding against the Hogs Breath Café until their costs had been paid in full, noting it was not appropriate to do so in the circumstances.
Declassing
In March 2024, NSW Supreme Court Justice Garling rejected the Respondents’ application to declass a second Scenic Tours Class Action, on the basis that group members could not properly form part of the class unless they had been on the same cruise as the Lead Applicant and contracted directly with Scenic Tours. The Respondents submitted there could be no common questions of fact or law between Australian and international guests, in particular.
His Honour held that the proceeding was properly commenced as a class action and that “as a matter of principle” there was no reason that international passengers could not be involved. He expressed the view that granting the Respondents’ application would ignore the reality of the fact that brochures advertising Scenic Cruises had been provided to customers in Australia, Canada and the UK. That passengers had arrived from various places, was irrelevant to whether or not they had received the “Scenic experience” promised by those brochures. His Honour noted that whether or not the Australian Consumer Law would apply to international passengers was a substantive question of law that would be considered in the proceeding.
Multiplicity
In two separate judgments in August 2024, Victorian Supreme Court Justice Delaney and Federal Court Justice O’Bryan, agreed that carriage of the IC Markets Class Action was to be awarded to Echo Law and Piper Alderman’s consolidated proceeding filed in the Federal Court, over Banton Group’s proceeding filed in the Victorian Supreme Court. Their Honours’ reasoning included that the consolidated proceeding was better prepared and had more secure funding, but more notably, that Banton Group appeared to have “plagiarised” the consolidated proceeding’s pleading.
Both Judges considered the significant amount of work that had gone into preparation of the pleading in the consolidated proceeding as a key factor in deciding to award carriage to Echo Law and Piper Alderman, noting the practitioners who had “plagiarised” the pleading would not be as prepared to progress the claim as those who had undertaken the work involved in drafting it.
Calderbank offers in class actions
In the Ruby Princess Class Action, Federal Court Justice Stewart found that a previous decision of Justice Wilcox in McMullin v ICI Australia was “clearly wrong”, to the extent that it held Calderbank offers cannot operate in class actions as they do in ordinary litigation, if they are made to settle the claims of all group members in a global amount. His Honour noted the reasoning in McMullin was difficult to understand and that Justice Wilcox may not have been intending to establish any principle about the use of Calderbank offers in representative proceedings.
In any case, His Honour considered Calderbank offers in class actions to be useful tools for encouraging settlement. He stated that settlements of class actions are “almost invariably” based on global amounts and that to deny respondents the ability to put applicants at risk on costs by making reasonable Calderbank offers would be contrary to encouraging settlements. He held that there could be adverse costs consequences for the Applicants in the Ruby Princess class action if the damages they ultimately received were less than a $15 million settlement offer from the Respondents, that the Applicants had rejected.
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