representative proceedings

Question 1

what are representative proceedings?

Answer 1

legal proceedings in which a group of people who have a claim based on similar or related facts bring that claim to court in the name of one person.

Question 2

what is a representative proceeding also known as?

Answer 2

a class action.

Question 3

what are the three requirements of a representative proceeding?

Answer 3

seven or more people have claims against the same defendant, the claims relate to similar circumstances, the same issues need to be decided in the case.

Question 4

what is the ‘opt out’ model in Australia?

Answer 4

this is where every person in the relevant group is assumed to be part of the representative proceeding unless they decide to ‘opt out’ by filing a notice with the court.

Question 5

what is the relevant court required to notify the group members of?

Answer 5

of the legal action and of their right to opt out.

Question 6

what happens if a person opts out?

Answer 6

they will not be bound by the decision or settlement, and may be able to pursue the defendant separately (but will have to bear that cost).

Question 7

what is the lead plaintiff?

Answer 7

the person who is named as the plaintiff in the representative proceeding, they represent the group.

Question 8

how do costs relate to the lead plaintiff?

Answer 8

• the lead plaintiff holds the cost liability.
• if the class action fails, they are solely responsible for all of the costs.
• if the class action succeeds, all group members share the costs of bringing the proceeding.
• group members are under no obligation to contribute to costs unless or until a successful outcome is known.

Question 9

what do group/class members do?

Answer 9

• they do not have costs liability unless the action succeeds.
• do not have to personally attend the trial or give evidence.
• will only be personally involved when deciding whether the opt out of the class and when submitting a proof of claim if a payment is to be made.

Question 10

what are some common examples of representative proceedings?

Answer 10

• product liability class actions (group of consumers have suffered the same loss or damage from a good or service).
• natural disaster class actions (group members have suffered loss or damage as a result of the same natural disaster).

Question 11

what are some benefits of class actions?

Answer 11

• group members can share the costs, allowing people to be part of civil actions they might not be able to afford themselves.
• more efficient for the court system to deal with one case than several on the same issue.

Question 12

how do litigation funders impact class actions?

Answer 12

they are prepared to pay the legal costs for the class action upfront in return for a percentage of any settlement or damages. this allows the lead plaintiff/group members to pursue the case if they do not have the funds to do so.

Question 13

what is an example of a class action?

Answer 13

the 2009 Black Saturday Bushfire Class Action

Question 14

what are some downsides of class actions for the lead plaintiff?

Answer 14

• costs liability (but usually not an issue because most are litigation funded or ‘no win, no fee’.
• stress/time etc of instructing lawyers, attending mediation/trial, giving evidence.

Question 15

what are some downsides of class actions for group members/lead plaintiff?

Answer 15

• may get less compensation than if they pursued their case individually.
• litigation funders will take a percentage of the total amount, reducing how much each group member gets.
• complexity of class actions usually lead to higher costs which are taken out of each members’ payments.

Question 16

what are some downsides of class actions for group members?

Answer 16

• no decision making control (no direct participation, instructions to lawyers, etc).
• delays due to complexity.