FEDERAL COURT OF AUSTRALIA
Capic v Ford Motor Company (No 2) [2016] FCA 1178
File number: NSD 724 of 2016 Judge: PERRAM J Date of judgment: 30 September 2016 Catchwords: PRACTICE AND PROCEDURE – representative proceedings – security for costs
PRACTICE AND PROCEDURE – representative proceedings – removal of persons from group
Legislation: Federal Court of Australia Act 1976 (Cth) ss 33K, 33ZG and 43(1A) Cases cited: Bray v F Hoffmann-La Roche Ltd (2003) 130 FCR 317
De Jong v Carnival PLC [2016] NSWSC 347
Kelly v Willmott Forests Ltd (in liq) (No 2) [2013] FCA 732
Kelly v Willmott Forests Ltd (in liq) (No 3) [2014] FCA 78
Date of hearing: 16 September 2016 Registry: New South Wales Division: General Division National Practice Area: Commercial and Corporations Sub-area: Regulator and Consumer Protection Category: Catchwords Number of paragraphs: 31 Counsel for the Applicant: Mr R White Solicitor for the Applicant: Bannister Law Counsel for the Respondent: Mr C Scerri QC with Ms K Anderson Solicitor for the Respondent: Allens ORDERS
NSD 724 of 2016 BETWEEN: BILJANA CAPIC
Lead Applicant
AND: FORD MOTOR COMPANY
Respondent
JUDGE:
PERRAM J
DATE OF ORDER:
30 SEPTEMBER 2016
THE COURT ORDERS THAT:
1.The respondent’s interlocutory application be dismissed with costs.
2.The parties bring in orders in relation to the amendment issues within 7 days.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
PERRAM J:
There are two applications before the Court. The first is an application for security for costs by the respondent to the action, the Ford Motor Company of Australia Limited (‘Ford’). The second is an application by the lead applicant to remove certain persons from the class.
The background to the class action is set out in my previous judgment in Capic v Ford Motor Company of Australia Limited [2016] FCA 1020. These reasons assume a familiarity with those reasons. Briefly, the lead applicant, Ms Capic, sues Ford on her own behalf and on behalf of a class of persons who have purchased vehicles manufactured by Ford which are alleged to be suffering from a defective transmission.
1. Security for costs
Ford seeks to have Ms Capic put up $365,000 by way of security to cover Ford’s costs to the close of the pleadings. Although Ms Capic is not impecunious, it was not suggested by either party that her assets would be sufficient to enable security to be provided by her alone. This is certainly true in relation to the first tranche of security sought by Ford for the period to the close of the pleadings. It is even more obviously true in relation to Ford’s future legal costs, which in a class action about the transmissions in mass-produced vehicles are likely to be significant.
It is therefore not in doubt that if security were to be ordered, Ms Capic would be unable…
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- Case
- [2016] FCA 1178
- Decision Date
CaseChat Overview and Summary
The court examined the Federal Court Rules 2011 and relevant case law to determine the procedural obligations of the plaintiffs. It held that the requirement for security for costs was not automatically applicable in all representative proceedings, but rather should be assessed on a case-by-case basis. The court found that the plaintiffs had adequately demonstrated that the individual interests of the group members were aligned, and that it was in the interests of justice to allow the representative action to proceed without the immediate imposition of security for costs. Additionally, the court considered the criteria for including individuals within the representative group, emphasising the need for a common issue of law or fact that binds the group members together. The court concluded that the proposed amendments to the representative group were appropriate, provided that the plaintiffs complied with the procedural requirements within the specified timeframe.
The Federal Court dismissed the respondent’s application, ordering the parties to finalise the orders regarding the amendment issues within seven days. The dismissal of the application was accompanied by an order for the respondent to pay the costs of the proceeding. The court’s decision highlighted the importance of a balanced approach in handling representative actions, ensuring that procedural fairness is maintained while facilitating effective litigation for groups of claimants with shared grievances.
Orders
Orders of the court
1. The respondent’s interlocutory application be dismissed with costs.
2. The parties bring in orders in relation to the amendment issues within 7 days.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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