Cantor v Audi Australia Pty Limited (No 5)

Cantor v Audi Australia Pty Limited (No 5) involved a consolidated proceeding brought by Australian purchasers of Volkswagen, Audi, and Skoda diesel-powered vehicles who sued Volkswagen and its related corporations for installing illegal software in the engines of the vehicles. The plaintiffs sought compensation for loss and damage allegedly suffered as a consequence of the software designed to circumvent Australian emissions standards in respect of nitrogen oxides (NOx). The proceeding sought representative proceedings under Pt IVA of the Federal Court of Australia Act 1976 (Cth). The court was required to decide whether to approve the settlement of the proceeding, whether to make a common fund order, and whether, if it declined to make a common fund order, to make a funding equalisation order in respect of commission payments and fees which a small number of group members agreed to make to the litigation funder. The court approved the settlement, finding that the settlement was in the best interests of the group members. It found that the applicants had discharged the onus of establishing that the settlement was fair, reasonable, and in the best interests of the group members. The court found that the settlement terms were fair and reasonable and did not disadvantage any group member. The court also found that the settlement was in the best interests of the group members, as it provided a practical and efficient means of resolving the proceeding, avoiding the costs and risks of continued litigation. The court further found that a common fund order was not appropriate in the circumstances of this case. The court found that there was no evidence to support the applicants' contention that the litigation funder was responsible for the delay in reaching a settlement, and that the applicants had not discharged the onus of establishing that a common fund order was necessary to achieve justice in the circumstances. The court also found that a funding equalisation order was not necessary, as the applicants had not established that the commission payments and fees were unfair or unreasonable. The proceeding was dismissed with no order as to costs and with all previous costs orders vacated. The dismissal was without prejudice to the parties' or the Administrator's liberty to relist the matter for the purpose of seeking orders consequential to the Settlement Deed and/or the Settlement Scheme. The dismissal of the proceeding was to take effect upon completion of the administration of the settlement.