Fuller v Fletcher Building Limited (No 2)
[2025] VSC 355
•23 June 2025
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL COURT
GROUP PROCEEDINGS LIST
S ECI 2022 03433
| GERALD FULLER | Plaintiff |
| v | |
| FLETCHER BUILDING LIMITED (ARBN 096 046 936) | Defendant |
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JUDGE: | Watson J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 28 and 29 January 2025 |
DATE OF JUDGMENT: | 23 June 2025 |
CASE MAY BE CITED AS: | Fuller v Fletcher Building Limited (No 2) |
MEDIUM NEUTRAL CITATION: | [2025] VSC 355 |
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COURTS AND JUDGES – Disqualification of judge – Reasonable apprehension of bias – Whether public comments made by judge prior to appointment warrant recusal – Whether past professional business association warrants recusal – Relevant principles considered – No reasonable apprehension of bias – Nonetheless prudent not to sit – Recusal of judge – Fuller v Fletcher Building Limited [2024] VSC 712; Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337; QYFM v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2023) 97 ALJR 419; Gaudie v Local Court (NSW) (2013) 235 A Crim R 98; Locabail (UK) Ltd v Bayfield Properties Ltd [2000] QB 451; NTD8 v Australian Crime Commission (2008) 249 ALR 559; Smits v Roach (2006) 227 CLR 423 considered.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr W A D Edwards KC with Ms L O’Rorke | Mayweathers |
| For the Defendant | Mr R G Craig KC with Mr R Rozenberg and Ms S Nambiar | Herbert Smith Freehills |
HIS HONOUR:
On 5 September 2024 the defendant (‘Fletcher’) made an application that I recuse myself from the case management and hearing of this proceeding on the ground of apprehended bias. On 31 January 2025 I advised the parties that I would recuse myself and provide reasons for doing so in due course. These are those reasons.
The proceeding
This proceeding is a class action instituted under the provisions of Part 4A of the Supreme Court Act 1986 (Vic). The plaintiff Mr Fuller represents a group of persons who acquired interests in fully paid ordinary shares in Fletcher on the Australian Securities Exchange or the New Zealand Main Board between 17 August 2016 and 23 October 2017. Mr Fuller pleads that Fletcher engaged in conduct that was misleading or deceptive in contravention of various statutory norms.
Mr Fuller is being funded in the proceeding by CASL Funder Pty Ltd (‘CASL Funder’) which has appointed CASL Management Pty Ltd (‘CASL Manager’) to assist CASL Funder with services in respect of the management of the litigation funding in the proceeding (together, ‘CASL’).
Mr John Walker is a director of CASL Funder and CASL Manager. Both CASL Manager and CASL Funder are wholly owned by CASL Group Pty Ltd. Mr Walker and his wife own 100% of the issued shares in Legal Precedents Pty Ltd, which is CASL Group’s majority shareholder.
Mr Walker has a long history of involvement in litigation funding in Australia. I detail more of that history in the discussion below.
The proceeding was commenced on 2 September 2022. Until 4 June 2024 it was managed by another judge of the Court.
On 4 June 2024 the parties were sent an email from the Commercial Court Registry advising them that the matter had been transferred to me for case management and hearing. That email made reference to an extant discovery dispute which was before Judicial Registrar Gitsham.
On 13 June 2024 Mr Fuller’s solicitors contacted my chambers advising that the parties had reached a consent position on discovery before Gitsham JR and requesting a case management conference after discovery had been finished, being a date not before 1 October 2024.
On 14 June 2024 the parties were advised that 30 October 2024 would be the first available date for a case management conference. Both parties confirmed that this date was suitable and my chambers confirmed the listing, though no formal orders were made.
On 5 July 2024 solicitors for Fletcher emailed my chambers indicating that there was a dispute between the parties regarding security for costs which Fletcher sought to have resolved. That email provided a proposed order containing various timetabling steps for the determination of the security for costs matter and indicated that it was Fletcher’s preference to have an oral hearing not before 27 September 2024, whilst it was the plaintiff’s preference that issues relating to security for costs be determined on the papers.
On 8 July 2024 orders were made consistent with Fletcher’s proposed orders and the summons in relation to security for costs was listed in conjunction with the case management conference on 30 October 2024.
On 17 July 2024 the timetabling orders for the security for costs summons were varied by consent.
On 29 July 2024 my chambers received an email from the solicitors for Fletcher seeking a mention of the matter pursuant to liberty to apply, because the parties had been unable to agree on a communication to the Court.
The mention was held on 2 August 2024. At the mention, senior counsel for Fletcher handed up a bundle of documents which included Fletcher’s proposed draft communication to the Court. In essence, that communication sought to draw my attention to the following facts:
(a) The proceeding is funded by CASL Funder;
(b) CASL Funder had appointed CASL Management to assist in relation to the proceeding;
(c) Pursuant to the funding arrangements, CASL will recover an amount in the range of 18 to 33% of any claimed proceeds;
(d) Mr Walker is a Director of both CASL entities and, together with his wife, has a significant ownership stake in those companies;
(e) Mr Walker had previously been a Director and had had an ownership stake in IMF Bentham Ltd (‘IMF’); and
(f) There was, it was said, a longstanding association between myself and Mr Walker by reason of the conduct or investigation of multiple class actions by Maurice Blackburn, which were funded by IMF and the joint funding arrangements in the proceedings Lidgett v Downer EDI Ltd (‘the Lidgett proceeding’)[1] between CASL Funder and Maurice Blackburn.
[1]S ECI 01835; [2023] VSC 574.
In addition to the draft email, senior counsel for Fletcher handed up copies of the decisions in QYFM v Minister for Immigration, Citizenship, Migrant Services & Multicultural Affairs (‘QYFM v Minister for Immigration’)[2] and Ebner v Official Trustee in Bankruptcy (‘Ebner’)[3] and a copy of the Australian Institute of Judicial Administration Guide to Judicial Conduct.
[2](2023) 97 ALJR 419.
[3](2000) 205 CLR 337.
No application was made by Fletcher for my recusal at that mention. Senior counsel said that he wished to ensure that an aspect that might not have been known to, or at least been fully appreciated by me was drawn to my attention.
Having heard from senior counsel for Fletcher, I then heard briefly from senior counsel for Mr Fuller. I then said:
Unless I’ve misapprehended the content of the communications, the matters which are averted to are matters of which I was aware. I was aware of the involvement of the funder and I was aware of the association of Mr Walker with the funder. And you can rest assured that I gave consideration to those matters before I took – accepted that the matter would be allocated to me. If your client want to make any application on that basis they can do so. But you need not worry that those matters had not arisen in my mind as things that I needed to consider.[4]
[4]Revised Transcript of 29 November 2024 4/1–15; Revised Transcript of 28 January 2025 2/8–3/12.
On 15 August 2024 the parties once again sought consent orders varying the timetable for the security for costs hearing. Those orders were made on that day.
On 5 September 2024 Fletcher issued a summons seeking my recusal from the proceeding, together with an affidavit of Jason Lawrence Betts affirmed on 3 September 2024 in support of the summons. On 5 September 2024 I made procedural orders for the filing and service of affidavits and submissions in relation to the summons, listed the summons for 30 October 2024 and adjourned the case management conference and the summons for security for costs to a date to be fixed.
Also on 5 September 2024, Fletcher issued a subpoena directed to Maurice Blackburn seeking production of various documents which were said to be relevant to its recusal application. Each of Maurice Blackburn and Mr Fuller objected to that subpoena. On 30 September 2024 Fletcher issued a second subpoena to Maurice Blackburn. Again, both Mr Fuller and Maurice Blackburn objected to that subpoena.
The objections to the first and the second subpoenas were referred to Delany J. His Honour heard argument on 2 and 10 October 2024.
On 15 November 2024 Delany J upheld the objections to the subpoenas, ordered that they be set aside and delivered reasons (‘subpoena reasons’).[5]
[5]Fuller v Fletcher Building Limited [2024] VSC 712.
The subpoena reasons contain a comprehensive consideration of the authorities regarding the practice and procedure to be adopted in a recusal application. Following that consideration, Delany J said:
A subpoena may only be issued pursuant to r 42A in order to secure the production of a document ‘for evidence.’ A recusal application at first instance is not heard and determined by reference to evidence. At first instance evidence is not admissible. It follows the subpoena process for which the rule provides is not available in the present circumstances.
The ‘ordinary and correct practice’ is that the judge who is the target of the objection both constitutes the court and determines the objection. The judge does so based on his or her knowledge of all relevant and material facts and circumstances disclosed in open court. The disclosure by the judge is not limited to publicly available information as appears to be assumed in submissions on behalf the defendant.
It is the fundamental ethical duty of the judge to disclose all relevant material facts and circumstances and to police his or her own disqualification status. As Martin J said in Limbo v Little, it is for the judge to decide whether disclosure should be made and not for a litigant to venture upon a ‘fishing expedition’. It is not for the litigant to pry into the judge’s background as was sought to be done in some of the earlier cases previously discussed including Quach and Dovade.
The disclosure by the judge is not evidence. The disclosure by the judge provides the foundation upon which parties are to be afforded an opportunity to make submissions.
When determining the recusal application the judge does so based on his or her own disclosure, not based on or by reference to evidence. The judge does so standing in the shoes of the fair-minded lay observer.
Consistent with the judge determining a recusal application through the lens of the fair-minded lay observer based on disclosure, the ordinary and correct practice does not contemplate evidence, let alone evidence on subpoena. As noted by Gordon J in QYFM, the practice and procedure for raising and determining objections for apprehended bias has historically been informal.
The judge cannot introduce evidence upon which he or she might be required to rule. While not required to be taken at face value, disclosure by the judge does not expose the judge to cross-examination.
Just as the judge cannot adduce evidence at first instance on a recusal application, it is not open to the parties to adduce evidence.[6]
(citations omitted)
[6]Ibid [180]–[187].
Later in the subpoena reasons his Honour said:
While in this case there has been a short mention hearing at which, without prior notice, a possible recusal application was foreshadowed but none was made, since the recusal application and the subpoenas were issued there has been no hearing before Watson J at which there has been an opportunity for his Honour to make the relevant disclosure.
The recusal application itself is yet to be heard and determined. The opportunity for the judge to make disclosure in accordance with conventional practice remains available.[7]
[7]Ibid [207]–[208].
On 29 November 2024 I listed the matter for mention and made my disclosure. I refer to relevant aspects of that disclosure in the reasons below.
On 9 December 2024 Fletcher filed written submissions taking into account my disclosure. Mr Fuller’s written submissions were filed on 24 December 2024. Fletcher’s reply submissions were filed on 24 January 2025.
The matter was heard over two days on 28 and 29 January 2025. Prior to the commencement of the hearing on 28 January 2025 I made supplementary disclosure in relation to three matters which had arisen from the content of Fletcher’s written submissions.
As indicated above, on 31 January 2025, having reflected on the submissions of the parties I advised them by email that I would recuse myself from the further hearing of this matter.
Ebner and the fundamental principles
I was taken to a considerable number of authorities but the fundamental principles governing the disposition of the matter before me are not in dispute. All, or nearly all, derive from Ebner.[8] In the course of my judgment below I will refer to other authorities where they are apposite, but for present purposes it is appropriate to set out the principles established by Ebner.
[8](2000) 205 CLR 337 (‘Ebner’).
Ebner establishes the following:
(a) ‘Fundamental to the Common Law system of adversarial trial is that it is conducted by an independent and impartial tribunal.’[9]
[9]Ibid 343 [3] (Gleeson CJ, McHugh, Gummow and Hayne JJ).
(b) ‘Judges have a duty to exercise their judicial functions when their jurisdiction is regularly invoked and they are assigned to cases in accordance with the practice which prevails in the court to which they belong. They do not select the cases they will hear, and they are not at liberty to decline to hear cases without good cause. Judges do not choose their cases; and litigants do not choose their judges.’[10]
[10]Ibid 348 [19].
(c) ‘Where, in the absence of any suggestion of actual bias, a question arises as to the independence or impartiality of a judge… the governing principle is that, subject to qualifications relating to waiver… or necessity…, a judge is disqualified if a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the question the judge is required to decide.’[11]
[11]Ibid 344 [6].
(d) The application of the apprehension of bias principle requires two steps. ‘First, it requires the identification of what it is said might lead a judge… to decide a case other than on its legal and factual merits. The second step is no less important. There must be an articulation of the logical connection between the matter and the feared deviation from the course of deciding the case on its merits.’[12]
[12]Ibid 345 [8].
(e) ‘This is not to say that it is improper for a judge to decline to sit unless the judge has affirmatively concluded that he or she is disqualified. In a case of real doubt, it will often be prudent for a judge to decide not to sit in order to avoid the inconvenience that could result if an appellate court were to take a different view on the matter of disqualification.’[13]
[13]Ibid 348 [20].
(f) ‘The bare assertion that a judge… has an “interest” in litigation, or an interest in a party to it, will be of no assistance until the nature of the interest, and the asserted connection with the possibility from departure from impartial decision-making, is articulated.’[14]
[14]Ibid 345 [8].
(g) The categories of case involving disqualification by reason of the appearance of bias referred to in Webb v The Queen[15] in the judgment of Deane J are a convenient frame of reference for consideration, but not a substitute for the ultimate test.[16] Those categories are:
[15](1994) 181 CLR 41.
[16]Ebner 348–349 [24].
(i) interest;
(ii) conduct;
(iii) association; and
(iv) extraneous information.
(h) The concepts of interest and association will overlap in many cases.[17]
[17]Ibid 349 [28].
(i) ‘It is not only association with a party to litigation that may be incompatible with the appearance of impartiality. There may be a disqualifying association with a party’s lawyer, or a witness, or some other person concerned with the case. In each case, however, the question must be how it is said that the existence of the “association” or “interest” might be thought (by the reasonable observer) possibly to divert the judge from deciding the case on its merits… [U]nless that connection is articulated, it cannot be seen whether the apprehension of bias principle applies’.[18]
[18]Ibid 350 [30].
(j) ‘[I]n the ordinary case, where a judge owns shares in a listed public company which is a party to, or is otherwise affected by, litigation, and there is no other suggested form of interest or association, the question whether there is a realistic possibility that the outcome of the litigation would affect the value of the shares will be a useful practical method of deciding whether a fair-minded observer might hold the relevant apprehension. In such a case, if the answer to the question is in the negative, the judge is not disqualified. If the answer to the question is in the affirmative, the judge is disqualified not “automatically”, but because, in the absence of some countervailing consideration of sufficient weight, a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the case.[19]
(k) ‘As a matter of prudence and professional practice, judges should disclose interests and associations if there is a serious possibility that they are potentially disqualifying… It is, however, neither useful nor necessary to describe this practice in terms of rights and duties… A failure to disclose is relevant (if at all) only because it may be said to cast some evidentiary light on the ultimate question of reasonable apprehension of bias. A failure to disclose has no other legal significance. In particular it does not, of itself, give a litigant any right to have the judge desist from further hearing the matter or to have the ultimate decision in the matter set aside for want of procedural fairness.’[20]
(citations omitted)
[19]Ibid 351 [37].
[20]Ibid 360 [69]–[70].
Fletcher accepts the last of the propositions quoted above, in so far as it emphasises that a failure to disclose is relevant to the extent it casts evidentiary light on the ultimate question of reasonable apprehension of bias. However, Fletcher says that subsequent High Court dicta in QYFM v Minister for Immigration[21] in the judgments of Gordon and Jagot JJ uses the language of a duty to disclose. In my view, those judgments emphasise the judge’s professional and ethical obligations to disclose matters but do not suggest a modification of the principle articulated in Ebner so far as the characterisation of disclosure and its legal significance.[22]
[21](2023) 97 ALJR 419.
[22]Ibid 442–443 [96], [101] (Gordon J), 483 [319] (Jagot J).
Fletcher’s grounds
Fletcher does not assert actual bias.
Fletcher seeks my recusal because of reasonable apprehension of bias based on:
(a) my ‘strong public advocacy and expression of firm views (including shortly prior to [my appointment]) against, or critical of, corporate defendants in a similar position to Fletcher in this proceeding, and/or in favour of the interests of plaintiffs, plaintiff law firms and/or litigation funders’;[23]
[23]Court Book (‘CB’) 3693.
(‘the conduct ground’)
(b) ‘Having regard to [my] long-standing commercial association with Mr John Walker (and/or entities related to Mr Walker) in circumstances where Mr Walker and the entities related to him (as funder and manager of the Proceeding) have a significant interest in the outcome of, and the decisions to be made in, the Proceeding’.[24]
(‘the association ground’)
[24]Ibid.
Fletcher asserts that the reasonable apprehension of bias is further bolstered by the fact that my disclosure did not occur until 29 November 2024, approximately six months after I was allocated the proceeding and makes certain criticisms of that disclosure.
For the reasons which are set out below, I do not accept that Fletcher has established that the matters upon which they rely establish a basis for my recusal. Nonetheless, I do accept that this is a case in which it would be prudent for me not to sit in order to avoid the inconvenience that could result if an appellate court were to take a different view on the matter of disqualification.
Is evidence admissible?
Notwithstanding Delany J’s ruling that evidence is not admissible on a recusal application at first instance, Fletcher seeks to adduce evidence by way of three affidavits:
(a) an affidavit of Jason Lawrence Betts affirmed 3 September 2024;
(b) an affidavit of Jason Lawrence Betts affirmed 22 November 2024; and
(c) an affidavit of Tracy Emma Tran affirmed 17 January 2025.
Fletcher did not appeal the subpoena decision, but it contends that I should not follow that decision because it is plainly wrong. Mr Fuller submitted that given the judgment of Delany J had not been appealed, I ought to proceed on the basis that the evidence was inadmissible.
I accept Mr Fuller’s submission. The judgment of Delany J was a considered determination on a question of law in this proceeding which Fletcher has not appealed. Fletcher does not allege any change in material circumstances warranting a reconsideration of the earlier interlocutory decision in this proceeding but simply invites me to take a different view to Delany J in the application before me. It would not be appropriate for me to do so and I proceed on the basis that the application is to be determined in the absence of evidence and on the basis of my disclosure.
In any event, as Mr Fuller submitted in the alternative, the admission of evidence will not make any difference to the outcome of the recusal application.
Conduct ground - statements made prior to appointment
As noted above, Fletcher submits that it is appropriate that I recuse myself because of a variety of statements I made prior to my appointment as a judge, which it characterises as against or critical of corporate defendants and/or in favour of the interests of plaintiffs, plaintiff law firms and/or litigation funders. In oral submissions counsel for Fletcher placed those statements into three ‘buckets’:
(a) Expressions of support for or preconceived views in favour of CASL and Mr Walker;
(b) Expressions of support for or preconceived views in favour of litigation funders more broadly and their interests; and
(c) Statements reflective of preconceived views in favour of plaintiffs against corporate defendants in shareholder class actions.
Statement re CASL and Mr Walker
As it turns out Fletcher relies on only one statement as being in the first bucket, the following paragraph in an affidavit which I swore in the Lidgett proceeding:
As to role of the funder CASL, John Walker has been involved in funding class actions in Australia for more than 20 years, including when he worked at the litigation funder now known as Omni Bridgeway. Mr Schimmel and I (and others at MB) have worked with him on a number of class actions over the past 20 years. I am confident that his experience in class actions, including consolidated proceedings, will mean that MB and CASL will have a good working relationship in this case.[25]
[25]CB 21.
Fletcher says this paragraph indicates a favourable view of Mr Walker and CASL. That submission overreads what is actually said in the paragraph relied upon. Confidence that because of Mr Walker’s experience in class actions he will, in effect, behave in a professional manner is not a statement that a fair-minded lay observer might reasonably apprehend would mean that I might not bring an impartial mind to the resolution of the questions in the proceeding.
Statements re litigation funding
Annexed to these reasons is a list of all of the public statements I made on which Fletcher relies for its arguments in relation to the second and third buckets. I do not propose to deal with each statement individually in these reasons.
Insofar as those statements relate to the second bucket, it is apparent from those statements that, prior to my appointment as a judge, I made statements regarding litigation funding:
(a) which indicated support for litigation funding as a means of providing access to justice;
(b) which opposed certain proposed regulatory reforms of the Morrison government;
(c) which, in particular, opposed regulating litigation funding as managed investment schemes and a proposed legislated 30% cap on litigation funding commissions;
(d) acting on occasion, as spokesperson for an organisation called ‘Keep Corporations Honest’, which was an organisation of plaintiff law firms and litigation funders opposed to the Morrison government proposals for regulation of litigation funding; and
(e) advocating for contingency fees as a means of providing competition to litigation funders.
On occasions, I used fairly strong language in relation to the Morrison government’s legislation and proposals in relation to litigation funding and class actions. In October 2022, for example, I described the (by then former) government as having waged ‘an ideologically driven kind of jihad against access to justice’.
Fletcher says that the fair-minded lay observer might conclude from those statements regarding litigation funding that I might not decide the case impartially. In essence, the argument appears to be that because I have engaged, prior to my appointment, in public commentary which might be seen to be ‘in favour’ of litigation funding, the fair-minded lay observer might apprehend that in this case I may unconsciously prefer the interests of CASL and therefore, the plaintiff. I do not accept this submission.
Fletcher has not properly articulated the logical connection between those statements and the feared deviation from the course of deciding the case on its merits. Views as to the desirability or otherwise of litigation funding and as to the desirability or otherwise of particular forms of regulation of litigation funding do not imply anything regarding the particular litigation funder involved in this case, being CASL. Nor do they bear in any way on the issues in this proceeding. A view that litigation funding provides access to justice does not imply that a judge will favour plaintiffs who are funded by litigation funders. A view that litigation funders should not be regulated as managed investment schemes and subject to legislated funding commission caps similarly does not imply that a judge will favour a plaintiff funded by a litigation funder over a defendant. This is not a case which involves a consideration of that legislation or those proposals and will not involve me considering the actions of the Morrison government.
No fair-minded lay observer might reasonably reach the conclusion based on those statements that I might decide the case otherwise than on its merits.
Statements regarding corporate defendants
Fletcher also refers to a number of public comments I made before I was appointed as evidence that a fair-minded lay observer would conclude that I might favour plaintiffs and/or disfavour corporate defendants such as Fletcher. Those statements are also annexed to the reasons. Again, I do not propose to analyse each of the statements on which Fletcher relies in detail.
Junior counsel for Fletcher commenced his oral submissions in relation to this category of statement referring to an article in The Guardian newspaper published 11 March 2023. The relevant proportion of that article states as follows:
While the number of new class actions dropped significantly last year, the preceding years were particularly busy.
The main reason for that flurry stemmed from the banking royal commission, which found widespread misconduct when it reported its findings in early 2019.
“Where there is misconduct, actions will follow,” says Andrew Watson, national head of Maurice Blackburn’s class action practice.
Fletcher submits that cumulatively with other statements on which it relies the above statement might lead a fair-minded lay observer to conclude that I regard all corporate defendants as guilty of misconduct. I do not accept there is a reasonable basis on which the fair-minded lay observer might reach such a conclusion. It rests on the logical fallacy that because misconduct leads to class action (A implies B), I hold the view that all class actions necessarily involve misconduct (B implies A).
Fletcher placed some weight on the statement reported in The Guardian because of its proximity to my appointment. It is to be observed that that statement was some eight months prior to my appointment and is apparently the most proximate to my appointment of the statements on which Fletcher relies. In any event, as I have indicated, the statement does not convey the view which Fletcher says it does.
Next, Fletcher relies upon an article I wrote and which was published in The Australian newspaper on 13 July 2018. In that article I wrote:
As the Australian Law Reform Council inquiry into class actions progresses, much continues to be made about the regime, including exaggerated and misleading claims on the number of class actions, the level of settlements and the costs of directors and offices insurance.
Let’s start with two simple facts. In the past 26 years class actions have resulted in recoveries of more than $3.5 billion on behalf of everyday Australians who found themselves the victims of corporate misconduct. Class actions happen because companies break the law and cause significant losses for thousands of everyday Australians.
Complaining about an increase in class actions when there has been a dramatic increase in the level of exposed misconduct makes about as much sense as complaining about increased prosecutions in response to a crime wave.
…
Class actions provide an important check and balance on misconduct – something that not only assists those who have been wronged but also serves to benefit the majority of companies that do the right thing and act within the law.
In its recent report the Victorian Law Reform Commission sensibly has accepted that law reform in this area is about making a good system better and about increasing access to justice, not further restricting it.
It is to be hoped that once the ALRC sifts through the noise of the defenders and insurers of corporate wrongdoers it will recognise the good sense of a similar approach.
…
Reform of our class action systems should be fact based and considered; it should not be responsive to the histrionic and exaggerated claims of those whose interests are in defending corporate wrongdoers and reducing payouts to victims.
…
The ongoing ALRC inquiry presents an important opportunity to make a good system better, most critically for class action claimants.
What it should not be is an opportunity for sectional interests making exaggerated claims on behalf of corporate wrongdoers to wind back protections for everyday Australians affected by that misconduct.
Fletcher contends that the views expressed in that article were such that the fair-minded observer might consider that I consciously or subconsciously hold the view that all defendants in shareholder class actions are corporate wrongdoers. In the article, I express the view that class actions provide a check and balance on misconduct. The article, however, expressly states that the majority of companies do the right thing and act within the law.
The article was written in 2018, five years before my appointment and nearly six years before I was allocated these proceedings. On its face, the article is a contribution to a debate regarding potential law reform. Some of the language is strong, it refers to ‘corporate wrongdoers’ and those who make misleading, histrionic and exaggerated claims. That is not the same as saying all corporations or corporate defendants are wrongdoers and it is not a critique of all those who defend or insure corporations. Fletcher’s contention that the fair-minded lay observer might reasonably conclude that I hold the view that all corporations or corporate defendants are wrongdoers does not bear scrutiny.
Fletcher referred to another article which I had written, which was published in The Australian Financial Review on 5 December 2014 under the title ‘Class actions are bad for bad business’. Relevant portions of that article are:
There are around 5000 matters filed in Australia’s Federal Court every year. Of these, there is an average of fewer than 15 which are class actions, or around 0.3 per cent of all Federal Court matters.
Surprised? On average, there are also only about three shareholder class actions filed every year. It’s hard to believe the numbers especially given the nature of class actions coverage over the past year. These figures are supported by the independent research by the Productivity Commission, released this week in its Access to Justice Arrangements Report and by Professor Vince Morabito in his latest tranche of empirical study into Australia’s class action regime.
So why has there been so much discussion regarding a phenomenon that the Productivity Commission notes impacts on only 0.2 per cent of ASX-listed companies every year?
Ideally, it would be because the advent of a market-based mechanism to remedy corporate wrongs and ensure the efficient allocation of capital in our sharemarket is seen as a welcome boost to safeguarding the market’s integrity.
Equally pleasing would be due acknowledgment that both large-scale institutional investors and retail investors benefit from participating in those actions by recovering losses and imposing a check and balance on corporate misconduct.
Unfortunately, it’s more likely due to the hysterical and ill-informed nature of much of the debate around class actions, fuelled by a lobby group of vested interests spreading fear and often outright falsehoods.
…
Sadly, we can expect the same chorus of anti-class action lobbyists to engage in a similar disparaging exercise over damages-based billing.
If we are serious about increasing access to justice, damages-based billing, should be one of several measures adopted by state governments. Rather than decrying class action settlements as a cost to business, those engaged in commentary would do well to embrace the facts – class actions aren’t bad for business, they are bad for bad business, and that is a check and balance that benefits everyone.
Fletcher asserts that a fair-minded lay observer might interpret the above statement as indicative of a view that it is only or principally bad businesses that are the subject of shareholder class actions. The article does not say that. The fair-minded lay observer would not interpret it as saying so. The article was written approximately nine years before my appointment. On its face, it arises in the context of a debate regarding the number of class actions which were issued at that time.
Fletcher also relies on comments I made in an article relating to a shareholder class action against the Commonwealth Bank of Australia in 2017. Fletcher relies on the last sentence of that article where I am reported as saying ‘The problem here is not the class action, but the underlying corporate misbehaviour that caused the class action’. It is plain that that comment is a reference to the alleged conduct of the Commonwealth Bank of Australia. It is not a comment regarding corporate defendants more generally or corporate defendants in shareholder class actions more generally.
Junior counsel for Fletcher submitted that this article had to be read cumulatively with other articles and suggested it would be an error to analyse the comments I had made on a one-by-one individual analysis.
I accept that it is necessary to consider the cumulative effect of statements I made, including those made more than five years before my appointment, I do not accept that it is permissible to simply aggregate a series of statements without analysing what was actually said. The fair-minded lay observer would not conclude that, because I held a particular view regarding the Commonwealth Bank of Australia’s conduct in relation to specific matters in 2017, that I would hold any view relevant to the conduct of Fletcher in this matter in 2025.
The above comments were the only ones to which Fletcher referred in oral argument, presumably, because it considers they represent some form of high watermark in relation to my public commentary. Fletcher, however, did rely on a range of other comments made by me. Again, I have included these in an annexure to these reasons. Without dealing with each such comment they can be categorised broadly in the following way:
(a) All pre-date my appointment to the Court, most by years;
(b) Many are comments made in the context of a specific class action in which Maurice Blackburn was acting and need to be considered in that light;
(c) Some are contributions to discussions regarding law reform where I emphasise the importance of class actions in providing a remedy for corporate misconduct;
(d) In many of the discussions regarding law reform I argue for an evidence based approach; and
(e) Some employ relatively forceful language.
A fair-minded lay observer would recognise that as a solicitor for plaintiffs in class actions it was part of my role to advocate, sometimes forcefully, on behalf of my clients in those class actions, for law reforms I thought would enhance outcomes for plaintiffs and group members and against law reform proposals, which I thought would have negative outcomes for plaintiffs and group members.
Conclusion re public commentary
I have not made any extra-curial public comments regarding litigation funding or class actions since my appointment as a judge.
By reason of my training, tradition and oath, I am required to discard the irrelevant, the immaterial and the prejudicial. I accept that the authorities emphasise that the fact of the training, tradition and oath of a judge is not a conclusive answer to the possibility of reasonable apprehension of bias,[26] but nor is it a matter which can simply be discarded in a consideration of whether the fair-minded lay observer’s apprehension of bias is reasonable.
[26]See for example QYFM v Minister for Immigration (2023) 97 ALJR 419, 480 [297]–[298] (Jagot J).
It is of some note that Fletcher was unable to point to a single authority in which a judge had recused themselves or an appellate court had determined that a judge should have recused themselves for reasonable apprehension of bias in relation to public comments made by them prior to their appointment to office.
In this aspect of its argument Fletcher relied upon:
(a) Gaudie v Local Court (NSW),[27] a case involving comments made by a Magistrate whilst a Magistrate. The latest of those comments appeared in The Australian newspaper on 18 January 2013 just prior to an application for recusal made on 5 February 2013 and subsequent applications made 4 April 2013 and 9 May 2013;
[27](2013) 235 A Crim R 98.
(b) Locabail (UK) Ltd v Bayfield Properties Ltd (‘Locabail’),[28] in which a judge in England was held by the Court of Appeal, in certain comments he made as a judge, to have expressed himself in terms which might indicate he had preconceived views and thus to have crossed ‘an ill-defined line’; and
[28][2000] QB 451 (sub nom Timmins v Gormley).
(c) NTD8 v Australian Crime Commission (‘NTD8’),[29] where Justice Reeves refused to recuse himself on the basis of public comments made by him in August and September 2007 because his public comments:
could not possibly be interpreted as referring to the applicant, either individually, or as a member of any identifiable group.
and
were not made in the course of these proceedings and they did not relate directly or indirectly to a person involved in these proceedings…, nor did they relate directly to any issue that arises in these proceedings… To the contrary, [the] public comments were made some time ago, that is, 10 months, in circumstances far removed from these proceedings, that is, in a public forum and in the national media about matters of current affairs, that are, at their highest, only very generally connected to the issues in these proceedings.[30]
[29](2008) 249 ALR 559.
[30]Ibid 575–576 [59], [61].
Fletcher contends that the decision in NTD8 provides evidence that there is no bright line between comments made prior to appointment and those made after appointment when it comes to establishing a reasonable apprehension of a lack of impartiality. I accept that is so. Nonetheless, it is plain that the fair-minded lay observer will be much more concerned regarding statements made by a judge as a judge and will correspondingly be less concerned regarding statements made in public debate in another capacity.
It is also noteworthy that in Locabail the Court of Appeal said:
It would be dangerous and futile to attempt to define or list the factors which may or may not give rise to a real danger of bias. Everything will depend on the facts, which may include the nature of the issue to be decided. We cannot, however, conceive of circumstances in which an objection could be soundly based on the religion, ethnic or national origin, gender, age, class, means or sexual orientation of the judge. Nor, at any rate ordinarily, could an objection be soundly based on the judge’s social or educational or service or employment background or history, nor that of any member of the judge’s family; or previous political associations; or membership of social or sporting or charitable bodies; or Masonic associations; or previous judicial decisions; or extra-curricular utterances (whether in textbooks, lectures, speeches, articles, interviews, reports or responses to consultation papers); or previous receipt of instructions to act for or against any party, solicitor or advocate engaged in a case before him...[31]
[31][2000] QB 451 480, [25].
In all the circumstances, Fletcher has not demonstrated that there is anything in the public comments which I made before I was appointed as a judge which might lead a fair-minded lay observer to think that I might not bring an impartial mind to the resolution of the questions which I would have been required to decide had I not recused myself.
The association with Mr Walker and his entities
In this case, Fletcher says that the frequency, intensity and duration of my association with Mr John Walker, CASL and various other corporate entities with which he is or has been associated is sufficient to warrant my recusal from this matter. As Ebner demonstrates, not every association between a judge and a person or entity involved in litigation will warrant a concern that the fair-minded lay observer might reasonably form the view that the judge might not bring an impartial mind to the resolution of questions in the proceeding.
For the reasons that follow, Fletcher has not established that proposition.
There is no dispute regarding the duration of my association with Mr Walker. I have known him professionally for approximately 20 years. I do not have any personal association with him.
In order to properly consider the nature of the association between myself and Mr Walker it is important, first, to set out relevant matters regarding our respective roles and economic interests over the course of that 20 year period.
Mr Walker’s roles
Mr Walker:
(a) between 2001 and June 2015, was an executive director of the company now known as Omni Bridgeway Ltd, but then known as IMF (Australia) Ltd, Bentham IMF Ltd or IMF Bentham Ltd (‘IMF’);
(b) was Managing Director of IMF between 2004 and June 2007;
(c) held shares in IMF, with holdings (personally or through entities controlled or substantially owned by him or close family members) ranging between 3 and 6% of the total shares in IMF between 2002 and 2015;
(d) in 2016 set up Investor Claim Partner Pty Ltd (‘ICP’) and related entities, being ICP Funding Pty Ltd (‘ICP Funding’) and ICP Capital Pty Ltd (‘ICP Capital’);
(e) formed CASL in 2020 with Mr Stuart Price;
(f) has been a Director of CASL Funder and CASL Manager since 19 October 2020; and
(g) with his wife owns 100% of the issued shares in CASL Group’s majority shareholder, Legal Precedents Pty Ltd.
My prior role
Prior to my appointment, I:
(a) was employed at Maurice Blackburn Pty Ltd (‘Maurice Blackburn’) from November 2004 until my appointment in November 2023;
(b) was appointed a salaried principal of Maurice Blackburn in November 2005. As a salaried principal, I did not have any economic interest in Maurice Blackburn, I was an employee with the title Principal;
(c) became an ‘equity principal’ in Maurice Blackburn on 1 July 2008. On becoming an equity principal, a company of which I was a director and shareholder commenced to own shares in Maurice Blackburn;
(d) was head of class actions at Maurice Blackburn from June 2011 until my appointment in November 2023;
(e) was a Director of Maurice Blackburn from 1 July 2008 until 30 June 2019;
(f) was a Director of Maurice Blackburn’s Australian litigation funding business known as Claims Funding Australia Pty Ltd from 26 June 2017 until 10 November 2023; and
(g) from around 2010 played an active role in providing advice to Claims Funding International Ltd (‘CFI’), which was Maurice Blackburn’s Dublin based European litigation funder and to its joint venture vehicle, Claims Funding Europe Ltd.
Prior to my appointment to the Court, I resigned from Maurice Blackburn and ceased to have any economic interest in that firm. My wife, however, continued to have an indirect economic interest in shares equivalent to approximately 5% of Maurice Blackburn’s total issued shares until 1 July 2024, after which she ceased to have any economic interest. The cessation of my wife’s interest in Maurice Blackburn had nothing to do with this proceeding. My wife was not employed by Maurice Blackburn and played no part in any of Maurice Blackburn’s activities in the period between my appointment and 1 July 2024.
For reasons I will come to, I do not accept that my wife’s shareholding in Maurice Blackburn in the period between 4 June 2024 and 1 July 2024 provides any basis on which a fair-minded lay observer might reasonably apprehend that I might not bring an impartial mind to the resolution of these proceedings.
For completeness, I should add that on my appointment I agreed that for a period of two years I would not sit on any case in which Maurice Blackburn was acting as solicitor or was a party.
The features of my association with Mr Walker may broadly be broken into issues relating to two time periods:
(a) November 2004 to June 2015 (‘the IMF period’); and
(b) June 2015 until 10 November 2023 (‘the post IMF period’).
The IMF Period
In relation to the IMF period Fletcher:
(a) pointed to Mr Walker’s various roles with IMF and described him as, in effect, the boss of IMF;
(b) noted that in that period, IMF had provided litigation funding in proceedings in which Maurice Blackburn acted for plaintiffs or applicants on 24 occasions;
(c) said that in the proceedings referred to in the previous paragraph, IMF and Maurice Blackburn had derived very substantial revenues, cumulatively in each case in excess of $100 million;
(d) contended that it was likely that Maurice Blackburn and IMF had investigated more than 300 ‘relevant potential actions’ which had not subsequently been issued;
(e) utilising various assumptions estimated that I may have worked directly with Mr Walker in considering or investigating more than 48 such relevant potential actions; and
(f) emphasised that from June 2011 I was the head of Maurice Blackburn’s class actions practice, with general oversight over its cases.
Some of this characterisation is accurate. Maurice Blackburn did act for plaintiffs or applicants in approximately 24 issued cases which were funded by IMF. Each of Maurice Blackburn and IMF derived substantial revenues from those cases, which in each case would have cumulatively exceeded $100 million.
However, significant aspects of the matters on which Fletcher relies are inaccurate. In my disclosure of 29 November 2024 to the parties I stated that in the IMF period:
My contact with Mr Walker primarily arose in relation to three sets of proceedings;
(a) Dorajay v Aristocrat Leisure Ltd … ‘Aristocrat class action’;
(b)Kirby v Centro Properties Ltd, Kirby v Centro Retail Group Ltd, Stott v PricewaterhouseCoopers Securities Ltd … ‘Centro class actions’; and
(c)Rodriguez & Sons Pty Ltd v Queensland Bulk Water Supply Authority (t/as Seqwater… ‘Queensland floods class action’.
In none of those proceedings was I the primary operator on the file. I assisted on certain aspects of the Aristocrat class action, but was not the supervising principal. I was the supervising principal for a portion of the Centro class actions and during part of that time Mr Walker was the IMF case manager. I negotiated the funding arrangements for the Queensland floods class action with Mr Walker. Shortly after those arrangements were finalised I had no contact with Mr Walker on that case.[32]
[32]Revised Transcript of 29 November 2024 9–10.
In its submissions, Fletcher criticised my disclosure of 29 November 2024 because:
(a) it said the use of the word ‘primarily’ obscured the extent of my involvement with Mr Walker on other cases; and
(b) it said that I had failed to address the number of relevant potential actions which I had worked with Mr Walker and which Maurice Blackburn had worked with IMF.
In its submissions, Fletcher derived numbers for potential actions which Maurice Blackburn and IMF may have worked upon together by applying assumptions that the number of issued cases which were funded by IMF and in which Maurice Blackburn acted for the plaintiffs or the applicants, constituted 5% (or alternatively 3% to 7%) of the total number of potential actions worked on collaboratively between IMF and Maurice Blackburn. It derived this assumption from published information in which IMF said that it accepted for ultimate funding only 5% of those cases in which applications were made to it and a similar public statement from another funder stating that only 3% to 7% of applications made to it were successful.
In light of the way in which Fletcher cast its argument following my disclosure on 29 November 2024, I made supplementary disclosure at the commencement of the hearing on 28 January 2025 in which I stated:
(a) The total number of cases on which IMF and Maurice Blackburn collaborated in the IMF period, including the 24 issued cases would be less than 50, and in all likelihood, was less than 40;[33]
(b) The total number of cases in which I worked, including issued cases, in which IMF was involved was, so far as I could recollect, 23. All but one of those cases issued – 18 were ultimately funded by IMF and four were ultimately funded by other litigation funders;[34] and
(c) The total number of actions on which I had interactions with Mr Walker in the IMF period (including the cases which I had referred to in my 29 November 2024 disclosure) was seven.[35]
[33]Revised Transcript of 28 January 2025 4.
[34]Ibid.
[35]Ibid 4–5.
In its oral submissions, Fletcher placed great weight upon what it said was an inconsistency or tension between my supplementary disclosure and the paragraph quoted above from one of the affidavits which I swore in the Lidgett proceeding. Fletcher says that that paragraph, in particular, is inconsistent with or in tension with my disclosure because it expresses a confidence which must have been borne out of Mr Walker and I working together on a larger number of class actions than my disclosure indicates. There is nothing in this point. The paragraph says in its terms that Mr Schimmel, myself and others at Maurice Blackburn had worked with Mr Walker on a number of class actions over the past 20 years. Patently there is nothing inconsistent with that statement and my disclosure of the number of class actions on which I worked with Mr Walker.
Fletcher also pointed to an alleged inconsistency between my disclosure and other affidavit material. This inconsistency arose, it was said, because in one of my affidavits in the Lidgett proceedings I had listed the case Hopkins v Aecom Australia Pty Ltd (No 8)[36] as a case which had settled for more than $100 million and on which I had worked. In an affidavit sworn by Mr Ben Slade, another principal of Maurice Blackburn, he had referred to that case as a case in which Mr Walker had been involved. There is no inconsistency. My involvement in that case arose in early stages and Mr Walker was not involved at the time I was involved, other employees and officers of IMF were involved at that stage.
The post IMF period
[36][2016] FCA 1096.
After Mr Walker left IMF in 2015, I did not have very much to do with him. His ICP entity funded one class action in which Maurice Blackburn acted for the applicant: Basil v Bellamy’s Australia Ltd.[37] I was not involved in the negotiation of funding terms for that action and I had no personal involvement in its conduct. It settled in 2020.[38]
[37]See McKay Super Solutions Pty Ltd (Trustee) v Bellamy’s Australia Ltd [2017] FCA 947.
[38]McKay Super Solutions Pty Ltd (Trustee) v Bellamy’s Australia Ltd (No 3) [2020] FCA 461.
I do not recollect any occasion on which Maurice Blackburn and ICP sought to jointly investigate a potential proceeding. Certainly, this did not occur in the five years prior to my appointment. It is possible that shortly after the establishment of ICP there were interactions between Mr Slade and Mr Walker regarding potential cases. If there were, I was not involved in any investigation. Since 2015 I have occasionally exchanged pleasantries with Mr Walker at conferences we have both attended. Other than that, my interactions with Mr Walker were limited:
(a) we had a discussion in early 2020 where he sought to enlist Maurice Blackburn’s support for an approach to the Victorian Government regarding amending a draft bill. I told Mr Walker that Maurice Blackburn did not support such an approach and that he was not to represent to the Victorian Government that we did;
(b) later in 2020, Maurice Blackburn participated, along with some other law firms and various litigation funding entities, in an organisation called ‘Keep Corporations Honest’. My recollection is that I participated in one meeting of that body after its formation at which representatives of CASL were also present, along with representatives of other law firms and other litigation funders; and
(c) I was involved in the negotiations for a cooperative arrangement in the Lidgett proceedings which I discuss in more detail below.
What is evident from the above is that, leaving aside issues related to the Lidgett proceeding, for approximately nine years prior to the allocation of this proceeding to me, I had had very little professional contact with Mr Walker. In those circumstances, once again absent considerations relating to the Lidgett proceeding, the combined effect of the contact I had with Mr Walker whilst he was at IMF and the very limited contact I had had in the nine years since, would not have given rise to a reasonable apprehension of bias in the Ebner sense.
The Lidgett proceedings
Fletcher’s application rests heavily on the arrangements which were reached between Maurice Blackburn and CASL in the Lidgett proceedings. In 2023 a multiplicity dispute arose in relation to four separate class actions against Downer EDI Ltd. Initially, those four cases were jointly managed by Justice Halley of the Federal Court of Australia and Justice Delany of this Court. On 7 June 2023 both courts made orders that the four parties involved in the multiplicity dispute confer with an aim to resolving it. Maurice Blackburn represented the plaintiffs in one of those cases, Mr and Mrs Lidgett. I was the Maurice Blackburn principal with senior oversight of that matter. Another principal of Maurice Blackburn, Mr Julian Schimmel, had the day to day conduct of the litigation.
In another proceeding, Mr Teoh and Mr Eckardt were plaintiffs represented by William Roberts, with CASL as litigation funders of their proceeding (‘the Teoh proceeding’). In a third proceeding Jowene Pty Ltd was the plaintiff represented by Piper Alderman (‘the Jowene proceeding’). In a fourth proceeding Kajula Pty Ltd was represented by Quinn Emanuel.
In accordance with the orders of the court and on the instructions of Mr and Mrs Lidgett, Maurice Blackburn and the Lidgetts reached an agreement with Jowene, the Teoh plaintiffs, William Roberts Lawyers and CASL. That agreement was reached in principle by 31 July 2023 but not executed until 18 August 2023.
Between 21 August 2023 and 25 August 2023 the Lidgetts, Maurice Blackburn, the Teoh plaintiffs, William Roberts and CASL negotiated a revised arrangement.
The substance of the revised arrangement was that:
(a) the Lidgett proceeding, the Jowene proceeding and the Teoh proceeding were to be consolidated;
(b) the Lidgetts are the plaintiffs in the consolidated proceeding;
(c) Jowene and the Teoh ceased being plaintiffs but were to be group members in the consolidated proceeding;
(d) the solicitors for Jowene, Piper Alderman, were to play no further part in the proceeding;
(e) Maurice Blackburn was to engage William Roberts Lawyers to perform work on the proceeding as its agent, with a notional split of the work being 70% for Maurice Blackburn and 30% for William Roberts;
(f) Maurice Blackburn funds its own professional fees;
(g) CASL Funder funds William Roberts;
(h) CASL procures an after the event insurance policy (ATE);
(i) Maurice Blackburn contributes 50% of the cost of the ATE;
(j) other disbursements associated with the proceeding are paid 65% by CASL and 35% by Maurice Blackburn; and
(k) if a GCO is made, any GCO proceeds are split 50% to Maurice Blackburn and 50% to CASL.
(‘the Lidgett arrangement’)
Fletcher says the Lidgett arrangement constitutes a business arrangement between Maurice Blackburn, in which I held an economic interest, and CASL, in which Mr Walker holds an economic interest, entered into shortly prior to my appointment and ongoing. Fletcher says this is sufficient on its own to warrant my recusal from the proceeding.
Ebner makes clear that not every form of business association, even if recent, is a basis for disqualification. In the course of the hearing, Fletcher also referred to and relied upon the Guide to Judicial Conduct (3rd edition) published by the Australasian Institute of Judicial Administration Incorporated (‘the guide’). The guide does not act as a substitute for the application of the reasonable apprehension of bias test established in Ebner, but it does provide important and useful guidance in relation to the issues. It is considerably more nuanced regarding business associations than Fletcher’s submissions would suggest.
The relevant portion of the guide is:
3.3.2 Business, professional and other commercial relationships
Business, professional and other commercial relationships have the capacity to cause a judge to have a potential interest in the outcome of litigation, and so to raise the question of possible disqualification. If such a relationship means that a judge has a “not insubstantial, direct, pecuniary or proprietary interest in the outcome of litigation” (Ebner [2000] HCA 63; 205 CLR 337 at [58]), disqualification will ordinarily be necessary.
The circumstances requiring consideration are varied. A judge should consider any current commercial or business activities, although it is likely that they will be limited. A judge should also consider any such activities undertaken by close relatives. Although these are properly to be considered under the heading “Personal relationships” (below), a financial interest of a close relative might be regarded by an observer as equivalent to a financial interest on the part of the judge.
The relationships or associations that require consideration under this heading include relationships such as insurer and insured, banker and customer, local government body and ratepayer, school and parent of child attending school. In some circumstances such a relationship could give rise to a disqualifying interest in the outcome of litigation. The judge should consider any such relationship that arises on the facts.
The judge should also consider whether any such relationship might give rise to a conflict of interest because of an appearance of predisposition in favour of or against the other party to the relationship. There is, for example, an obvious difference between the situation of the judge who is negotiating, say, the terms under which a bank will extend a significant overdraft, and that of a judge whose relations with a bank do not involve the bank doing anything more than honouring its obligations as a banker. Similarly, a judge who is a ratepayer and is also an objector to a rate assessment or an objector to a planning application, will be in a different situation to a judge who is merely a ratepayer. A judge whose claim under an insurance policy is questioned by the insurer is in a different situation to a judge who is merely a policy holder or whose claim under the policy is quite uncontentious.
…
3.3.4 Personal relationships
There are many personal relationships to be considered. The most important relationships may be categorised for present purposes as:
First degree – parent, child, sibling, spouse, domestic partner or other person with whom an intimate relationship exists or has existed;
Second degree – grandparent, grandchild, “in-laws” of the first degree, aunts, uncles, nephews, nieces;
Third degree – cousins and beyond;
…
And such relevant relationships may exist with:
(i) Parties;
(ii) Legal advisers or representatives of parties;
(iii) Witnesses.
In addition to such relationships, friendship or past professional or other association with such persons needs to be considered in some situations. There are no hard and fast rules, but the following guidance is offered.
…
(d) A current or recent business association with a party will usually mean that a judge should not sit on a case. For this purpose a business association usually does not include associations such as insurer and insured, banker and customer, rate payer and local government body, but might do so, depending on the circumstances.
(e) Past professional association with a party as a client is not of itself a reason for disqualification unless the judge has been involved in the subject matter of the litigation prior to appointment or unless the past association gives rise to some other good reason for disqualification.
If the judge has been involved in the subject matter of the litigation, the judge should not sit, but otherwise the decision to sit or not to sit may depend upon the extent of previous representation and when it occurred. It may be desirable to disclose the circumstances of such representation to the parties before deciding what to do. The nature and content of anything learned, or any views formed, bearing upon the credibility of the party may need to be considered.
…
(k) A recent business association between a judge and a witness will not necessarily be a basis for disqualification of the judge, particularly if the association involved only an isolated transaction, but all of the circumstances should be carefully considered.
In the latter two cases, the fact of the relationship or friendship, and ordinarily its nature, should be disclosed to the parties.[39]
(emphasis in original)
[39]Australasian Institute of Judicial Administration Incorporated, Guide to Judicial Conduct, 3rd ed (rev) (2023), 14–16.
As is evident, the Guide does not specifically address business associations with litigation funders. Fletcher sought to characterise the position of CASL as equivalent to a party to the litigation. I do not accept that characterisation. In any event, as the Guide makes clear, a past professional association with a party is not of itself a reason for disqualification.
In its submissions Fletcher emphasised the proximity of the Lidgett arrangements to my appointment. In a sense that factor cuts both ways. Because of the proximity of the Lidgett arrangements to my appointment there was, in fact, no practical implementation of those arrangements prior to my appointment beyond the participation in the hearing before Delany J on the multiplicity dispute.
In my view, when considering the impact of the Lidgett arrangement a fair-minded lay observer would have regard to the following:
(a) The relationship is relevantly between Maurice Blackburn and CASL;
(b) It is limited to the Lidgett proceeding;
(c) It was the only extant such arrangement between Maurice Blackburn and CASL;
(d) It was negotiated after the Federal Court of Australia and the Supreme Court of Australia ordered parties to confer to seek to resolve a multiplicity dispute;
(e) It is not related in any way to the subject matter of this proceeding; and
(f) Nothing in this proceeding could affect revenue derived by CASL or Maurice Blackburn in the Lidgett proceeding.
Fletcher contends however, that decisions I might make in this proceeding could impact on CASL’s capacity to meet its obligations to Maurice Blackburn in the Lidgett proceeding. As the argument was put in oral submissions, a decision I might make in these proceedings, for example, to award costs against the plaintiff might have sufficiently adverse financial implications for CASL – that it would be unable to meet its obligations to Maurice Blackburn to contribute to the costs of disbursements or to any uninsured component of a costs order awarded against the Lidgetts. Thus, it was contended that the fair-minded lay observer might consider that I might unconsciously favour the plaintiff or CASL in these proceedings in order to forestall such a consequence.
The fair-minded lay observer has to ‘reasonably apprehend’ that the judge might not bring an impartial mind to the resolution of the case. A consequence of that test is that the fair-minded lay observer is not concerned with mere theoretical possibilities. There is no reasonable basis upon which the fair-minded lay observer could conclude that it was likely or even that there was a substantial probability that any step I might take in this proceeding would have such a financial consequence upon CASL that it was unable to meet its obligations to Maurice Blackburn under the Lidgett arrangements.
At this point, it is worth considering the impact of my wife’s economic interest in Maurice Blackburn in the period between 4 June 2024 and 1 July 2024. At the outset it is appropriate to make clear that the relevant shareholding was not a shareholding in a party to this litigation or in an entity in anyway associated with this litigation. Rather, the shareholding was a shareholding in an entity which had a shareholding in Maurice Blackburn which had a limited business arrangement relating to a completely separate proceeding with entities (CASL) which had an interest in this proceeding.
Nonetheless, it is instructive to consider what the Guide says regarding a shareholding in a litigant company or companies associated with litigants:
3.3.1 Shareholding in litigant companies, or companies associated with Litigants
Relevant questions for the judge to consider are:
(a)is the shareholding sufficiently large to enable the judicial or related shareholder to influence the decisions of the company?
(b)is the value of the judicial or related shareholding likely to be affected by the outcome of the litigation?
But the ultimate issue is whether a fair-minded lay-observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the case.
If the answer to either question is in the affirmative, it is clearly a case for self-disqualification, but if the answer to both questions is negative, the basis for disqualification is much less obvious. Nevertheless, it is important to make full disclosure to the parties before making a decision, although a failure to do so in some circumstances may not be critical.[40]
[40]Ibid 13.
The answer to both questions (a) and (b) is negative and, at the risk of repetition, in this case the relevant shareholding is even more remote because it is not in a litigant company or a company associated with the litigants.
There is a further matter relating to this issue. As I have indicated, my wife’s shareholding in Maurice Blackburn ceased on 1 July 2024. Ebner makes clear that the test is one which is to be applied in relation to ‘the resolution of a question the judge is required to decide’. Prior to 1 July 2024, I had not been required to decide any question in the proceeding. The proceeding had been allocated to me, but no step other than the administrative listing of a case management conference had occurred.
So, in that period prior to 1 July 2024, there was, in fact, no occasion on which I might have favoured CASL and after 1 July 2024, there was in fact no relevant economic interest.
Fletcher, in its oral submissions in reply, said that the relevant time for any consideration of whether there was a reasonable apprehension of bias was at the time I was allocated the proceeding because at that stage I had capacity to influence the course of the proceeding. I accept that from the time I was allocated the matter I had a capacity to influence the proceeding. The question, however, is would the fair minded lay observer prior to 1 July 2024 have reasonably apprehended that I might not have brought an impartial mind to an issue to be resolved in the proceeding in order to avoid a sufficiently adverse economic outcome for CASL, which could have led to CASL failing to meet its obligations to Maurice Blackburn, which in turn could lead to a sufficiently adverse outcome for Maurice Blackburn that the value of the shares my wife held might be affected. I am of the view that a fair-minded lay observer would have regarded the fact of my wife’s interest in the shareholding in Maurice Blackburn prior to 1 July 2024, as so remote from the issues in this proceeding as to have no bearing on the question of whether I might not bring an impartial mind to the resolution of the questions I might have been required to decide.
Issues relating to disclosure
Fletcher makes a number of complaints regarding my disclosure in this matter. First, they contend a fair-minded lay observer would be concerned that I made no disclosure until 29 November 2024, almost six months after I had been allocated the proceeding.
When I was allocated the proceeding, I was aware that CASL was funding the proceeding. I was also aware and made certain that Maurice Blackburn had no involvement in the proceeding. In light of the very limited interactions I had had with Mr Walker and CASL in the nine years preceding the allocation, it simply did not occur to me that the involvement of CASL (and indirectly Mr Walker) created any issue which might require disclosure.
Fletcher also points to my failure to make disclosure after it had raised matters at the mention of 2 August 2024. At the mention Fletcher had referred to the fact that Mr Walker was associated with the CASL entities, that the CASL entities were funding the litigation, that Mr Walker had previously been employed by IMF, that IMF and Maurice Blackburn had worked collaboratively on a number of cases, and that Maurice Blackburn had entered the Lidgett arrangements shortly prior to my appointment.
At that stage, it was not apparent to me that there was a need for further disclosure. Fletcher was plainly aware of those matters because it had raised them at the mention. It was not clear to me, in those circumstances, that there was a need for any further disclosure. Smits v Roach[41] makes plain that where the relevant facts are known to the party objecting to the judge hearing the matter, the absence of disclosure of those facts is not a basis for disqualification. It was not apparent that Fletcher suggested I should disqualify myself and based on the matters raised at the mention, it was not apparent to me that further disclosure was required.
[41](2006) 227 CLR 423.
Fletcher then says that once it filed its motion and affidavit material in support of the recusal application on 3 September 2024, I should have made disclosure. After the summons and supporting material was filed, I made orders for the filing of further affidavits and submissions from Fletcher, affidavits and submissions from the plaintiff in response and any affidavits and submissions from Fletcher in reply and listed the matter for hearing on 30 October 2024.
I had intended to make any necessary disclosure on 30 October 2024 as the next date on which the matter was listed. Fletcher says this was an error on my part, that my obligation was to disclose any matter relevant to that association not simply to respond to those matters raised by it. I accept that my obligation to disclose is not merely responsive but as a practical matter, it would not have been appropriate to list the matter for disclosure. Shortly after the summons was filed it was drawn to my attention that Fletcher had issued a subpoena directed at Maurice Blackburn. That proceeding came before Justice Delany on the question of whether the subpoena should be set aside. In the circumstances, I regarded it as appropriate to wait until Justice Delany had delivered his reasons in relation to the subpoena before taking any further step in relation to Fletcher’s disqualification application, other than the consent orders to vacate the 30 October 2024 hearing date.
Within a week of Justice Delany handing down his decision in the subpoena matter, my chambers contacted the parties and arranged to list the proceeding for mention in which I could make disclosure. In the circumstances, I am not persuaded that I should have provided any disclosure prior to 29 November 2024.
After my disclosure of 29 November 2024, Fletcher filed submissions which amended earlier submissions to take account of my disclosure. As I have indicated, those submissions said that:
(a) I had failed to address the number of relevant potential actions which Maurice Blackburn and IMF worked together on in the period between 2004 and 2015;
(b) my disclosure of the matters on which I had ‘primarily’ had contact with Mr Walker whilst he was at IMF did not give a proper indication of the extent of my association in that period;
(c) I had misstated the number of issued cases on which Maurice Blackburn had acted for the plaintiff and IMF had provided litigation funding;
(d) there was a discrepancy between my disclosure and the affidavits filed in the Lidgett proceeding to which I have referred above;
(e) there was an apparent discrepancy between my recitation of what I said at the August mention and what was recorded in transcript; and
(f) I had not indicated the time at which my economic interest in Maurice Blackburn had ceased.
I read those submissions shortly before the hearing on 28 January 2025. On the morning of 28 January 2025, I gave further disclosure in which:
(a) dealt with issues relating to potential actions investigated jointly by Maurice Blackburn and IMF and, to the extent I was able, a more precise indication of the number of cases in which I interacted with Mr Walker during his time at IMF;
(b) accepted that I had not taken account of a further three cases in which Maurice Blackburn acted for the plaintiff and IMF provided funding; and
(c) advised the parties that I had listened to the tape of the mention and that the recitation of that portion of the mention on 29 November 2024 in my disclosure was accurate and that the transcript was inaccurate.
I did not and do not regard that the disclosure of 29 November 2024:
(a) did not give a proper indication of the duration, frequency and intensity of my association with Mr Walker. In that disclosure:
(v) I described the number of cases on which I primarily had contact with Mr Walker;
(vi) said that on the Aristocrat class action I was neither the primary operator, nor the supervising principal;
(vii) said that on the Centro class actions for a period of time I was the supervising principal and for a period of time Mr Walker was the case officer; and
(viii) described that on the Queensland Floods class action Mr Walker and I were involved at the outset in the negotiation of funding terms and that shortly after I concluded negotiating funding terms with him I ceased involvement on that case.
(b) as being inconsistent or in tension with the affidavits I swore in the Lidgett proceedings. I have dealt with this matter above.
I did not make disclosure on 28 January 2025 regarding when my economic interest in Maurice Blackburn ceased or of my wife’s economic interest in Maurice Blackburn between 4 June 2024 and 1 July 2024. In hindsight, it clearly would have been preferable if I had. It did not occur to me at that stage that my or my wife’s economic interests (neither of which were extant) were relevant to the way in which Fletcher articulated its complaint regarding my association with Mr Walker and CASL. It seemed to me that Fletcher rested its argument in that regard on the frequency, intensity and duration of my interactions with Mr Walker. At that stage I did not appreciate that, in addition, Fletcher would contend that a lay observer might reasonably apprehend that I might favour CASL in these proceedings in order to avoid a situation where CASL defaulted on its obligations to Maurice Blackburn in the Lidgett proceeding, resulting in adverse economic consequences for Maurice Blackburn.
Over the course of the hearing on 28 and 29 January 2025 Fletcher articulated its case in a way which made clearer to me that:
(a) it did assert that matters in this proceeding could have an adverse economic consequence for Maurice Blackburn; and
(b) that the relevant time to judge the impact of any such economic effect and, therefore, any relevant economic interest in Maurice Blackburn was from the moment the case was allocated to me.
In respect of this latter issue in submissions in chief (albeit in the context of a discussion regarding issues to do with public statements) Senior Counsel for Fletcher had indicated that the relevant time at which to judge matters was the time at which Fletcher made its application for my recusal, though it also maintained a submission that my disclosure should have been made very soon after being allocated the case in June 2024. In submissions in reply, Fletcher said that the relevant time at which matters should be considered was the date at which the matter was allocated to me, being the date from which I had a theoretical capacity to determine any question in the proceeding.
Having reflected on the submissions made over the course of the two day hearing it became apparent to me that there was a need to disclose my wife’s shareholding. I did so. I have indicated above why I do not accept that her economic interest in Maurice Blackburn for the period 4 June 2024 to 1 July 2024 would be a matter which would lead to my disqualification, but nonetheless, I accept that other minds might differ and that my failure to disclose her interest at an earlier point is a matter which made it prudent for me to recuse myself from the conduct of the proceeding.
On 31 January 2025 I advised the parties of that decision.
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ANNEXURE A
| Article Title | Publication | Date | Relevant Extract |
| “Judge excludes free riders from class suit” | Sydney Morning Herald | 23 July 2007 | "Andrew Watson, a principal of Maurice Blackburn Cashman, which is acting for the group of plaintiffs in the Multiplex case, said the decision made funded class actions easier. "It enhances access to justice because there are cases that won't run without funders", Mr Watson said." |
| “$110m boot on Wembley” | Herald Sun | 22 July 2010 | Maurice Blackburn principal Andrew Watson described the settlement as a "great day for investors who participated in the class action". Mr Watson said it had been alleged that starting in August 2004 and continuing to May 2005, Multiplex had persistently failed to tell the market about the cost overruns and consequent impact on profits and revenue in relation to three projects -- Wembley, the West India Quay hotel and apartment project in the UK, and the Qantas heavy maintenance hangar at Brisbane Airport. It had also been alleged Multiplex engaged in "creative accounting" to boost revenue figures, Mr Watson said. "Those allegations were of course denied . . . we are happy with the $110 million settlement that we've achieved today." Mr Watson said that after legal costs, about $100 million will go to investors and of that proportion about 35 per cent would go to the litigation funder. "It represents a great outcome for investors generally because it sends a message to corporate boardrooms throughout the country that people who do not comply with their continuous disclosure obligations will pay, and they'll pay big time," Mr Watson told reporters. |
| Shareholder Class Action Masterclass – ‘Negotiating and settling Australia’s largest disputes’ | - | 18 October 2010 | a. 'Know what the High Court wants from new Federal Court Procedures'; |
| “IMF may win big in damages suit" | The Australian | 23 March 2012 | "This case is going to involve a very significant expenditure of costs," said Andrew Watson, the head of major projects at Maurice Blackburn. "That is not something that an ordinary citizen can afford. A law firm like ours does run some large cases on a no-win no-charge basis, but we have, as do our competitors, limited financial resources and there are only so many cases we are in a position to do on that basis." IMF accepts that the concerns of the US Chamber of Commerce about a "culture of extortion" do have a basis in fact if they are confined to the litigation environment of the US." |
| “Industry on shaky ground” | Australian Financial Review | 1 December 2012 | The billion dollar figure was hit last month when National Australia Bank coughed up $115 million. This week he notched up another $47 million from Nufarm and Watson says he still gets a buzz from every win. "Maybe it's the competitive side in me, but there's nothing like winning," he says with a smile. … After reluctance to get involved many major institutional fund managers and super funds are regularly signing up to shareholder class actions, although their identity is not known. Given the settlements being offered and funds' fiduciary duties to act in the interest of investors, Watson says they are compelled to sign up. "Increasingly we're seeing institutions accept that they have that obligation," he says. Asked to respond to criticism that well-resourced institutional investors are not the intended users of class action procedure, set up for individual victims of negligent products, Watson said those critics should consider the implications of not having shareholder class actions; companies can breach the law and cause loss and never have to compensate their victims. |
| "Contingency fees on the agenda: Firms push U.S.-style billing" | The Australian | 27 September 2013 | The UK adopted it in April this year and we support the introduction of contingency fees." Andrew Watson, who leads Maurice Blackburn's class actions practice, said contingency fees would streamline the financing of class actions and provide competition for litigation-funding companies. "I think (contingency fees) should be introduced and at some point or other the inevitable logic in support of them will prevail," Mr Watson said. "It would be a relatively rational thing to consider. If you are worried about the cost of litigation and the proportionality of those costs to outcomes, one way you can address that is to say 'OK, we will let people charge by reference to the outcome they actually obtain'." … In separate interviews with The Australian, Mr Hardwick and Mr Watson both argued that contingency fees would lead to increased access to justice. They also defended the use of class actions and the current "light touch" regulation of the litigation funders. … At Maurice Blackburn, the firm has acted in about 37 class actions over the past 13 years. It has recovered just over $1.1bn for clients, according to Mr Watson. He said class actions backed by litigation funders had resulted in significant recoveries for victims of wrongs and there had not been a flood or litigation or an outbreak of unmeritorious claims. This was due to the combined impact of the loser-pays rule which requires the losing party in civil litigation to meet a proportion of the costs of the victor, the fact that Australia has a less litigious culture than the US, and the fact that "the judicial environment is less prone to excess" than in the US, Mr Watson said. |
| “Call for funder regulation” | Australian Financial Review | 15 November 2013 | "But Maurice Blackburn principal Andrew Watson said the claims were "massively As the firm's head of its class action department, Maurice Blackburn has asked the Federal Court to approve the involvement of a new funder — Claims Funding Australia — that it has set up to finance a horse-flu class action it is also running. Mr Watson, who is running the country's biggest suit for victims of the Black Saturday bush fires in Victoria against SP AusNet, has led other major actions including against 12 Australian banks over unfair fees, and settlements against AWB, Multiplex, Centro, as well as National Australia Bank for toxic debts during the global financial crisis. Mr Watson said evidence showed there was no explosion in suits in 21 years of class actions. These cases represented 0.1 per cent of all litigation in superior courts — or about 14 cases a year. About three a year were shareholder actions and Australia's "loser pays" system ensured there was no outbreak of unmeritorious and frivolous actions that resulted in people being held to account for alleged breaches of their obligations to companies and shareholders. "How anyone can say three a year represents a drain on the economy is a laughable proposition and one the AICD ought not to make," Mr Watson said. "Cases brought that have settled without liability indicate that people were concerned about risks they faced in the litigation." "People's lives were devastated through the Black Saturday fires and should recover from the electricity company. The electricity company [SP AusNet] is entitled to a defence. Do they say those victims should not have a remedy? Because that's what they're arguing for"." |
| “Contingency fees ‘would lower costs’ Litigation funding action urged” | The Australian | 15 November 2013 | In a statement yesterday, Mr Watson said: |
| “Class actions a form of greenmail as law firms chase ‘soft targets’” | Australian Financial Review | 14 August 2014 | "To claim that sloppy and illegal business practices should go unchecked makes a complete mockery of the very reason our share market works in efficiently allocating capital," he [Andrew Watson] said. |
| “Class actions are bad for bad business” | Australian Financial Review | 5 December 2014 | There are around 5000 matters filed in Australia’s Federal Court every year. Of these, there is an average of fewer than 15 which are class actions, or around 0.3 per cent of all Federal Court matters. Surprised? On average, there are also only about three shareholder class actions filed every year. It’s hard to believe the numbers especially given the nature of class actions coverage over the past year. These figures are supported by the independent research by the Productivity Commission, released this week in its Access to Justice Arrangements Report and by Professor Vince Morabito in his latest tranche of empirical study into Australia’s class action regime. So why has there been so much discussion regarding a phenomenon that the Productivity Commission notes impacts on only 0.2 per cent of ASX-listed companies every year? Ideally, it would be because the advent of a market-based mechanism to remedy corporate wrongs and ensure the efficient allocation of capital in our sharemarket is seen as a welcome boost to safeguarding the market's integrity. Equally pleasing would be due acknowledgement that both large-scale institutional investors and retail investors benefit from participating in these actions, by recovering losses and imposing a check and balance on corporate misconduct. Unfortunately, it's more likely due to the hysterical and ill- informed nature of much of the debate around class actions, fuelled by a lobby group of vested interests spreading fear and often outright falsehoods. It's an old tactic. In 1992, the world was about to end. The culprit wasn't a super bug, a computer virus or climate change. Damages-based billing (sic). According to the big names of Australian corporate law, new legislation enabling class actions was about to bring down the sky. The sky did not fall in, not in 1992 and, as the facts show, not because of class actions at any time since. Three shareholder class actions a year just don't have that kind of impact. (While we may have come close to a financial apocalypse, it was bankers around the world being given carte blanche that took us there, not class action lawyers.) In its report, the Productivity Commission recommended introducing capped damages-based billing to enhance access to justice. It will improve competition, provide greater transparency over lawyers' charging and deliver a real benefit to consumers who need equality of arms in their pursuit of accountability. Sadly, we can expect the same chorus of anti-class action lobbyists to engage in a similarly disparaging exercise over damages-based billing. If we are serious about increasing access to justice, damages based billing, should be one of several measures adopted by state governments. Rather than decrying class action settlements as a cost to business, those engaged in commentary would do well to embrace the facts - class actions aren't bad for business, they are bad for bad business, and that is a check and balance that benefits everyone. |
| “Whatever the amount, Surfstitch class action will settle: They all do” | Australian Financial Review | 9 June 2017 | Head of class actions at leading plaintiff law firm Maurice Blackburn, agrees. "Anyone running that line [about shareholders suing themselves] is giving the green light to unchecked corporate wrongdoing, while conveniently ignoring that insurance responds to many claims and the composition of the holding group also changes," he says, … Watson says that despite the growth in shareholder actions they are still "not by any stretch" the majority. … And he takes issue with a "theme that sometimes runs through that the shareholder class actions have somehow distorted the laudable aims of the system". Those laudable aims boil down to access to justice, the efficient resolution of disputes, and private enforcement. "When the bill for a class action regime was introduced, one thing the government emphasised was that it would be available for shareholders of companies engaged in misconduct," he says. "I've never understood the argument that suggested that somehow or other we'd be better off if we turned a blind eye to corporate misconduct that substantially impacts shareholders. In what other area would we see the best policy outcome is to turn a blind eye to a breach of the law?" |
| “Commonwealth Bank faces class action over money-laundering scandal” | The Guardian | 23 August 2017 | "We are talking about a long period of alleged misconduct, from 17 August 2015 until 1.00pm on 3 August 2017- nearly two years," Watson said on Wednesday." "We are talking about a heavily traded stock, probably one of the most heavily traded stocks on the market." "Our investigations and analysis show that this drop was in the top 1% of price movements that CBA experienced in the past five years, making it apparent that the news was of material significance to shareholders." "The Austrac allegations are extensive and it is astounding that the market would not be advised of such serious and repeated breaches as soon as the company became aware of them." … "Shareholders had a right to expect better from the board of a penny dreadful stock. That they were treated with such blatant and cavalier disregard by Australia's largest listed entity is |
| “Commonwealth Bank should pay the price for its wayward behaviours” | Canberra Times | 7 September 2017 | More importantly though, every CBA shareholder will benefit from the bank being properly held to account for its corporate governance failures. The alternative is to leave Austrac to prosecute the money laundering breaches but ignore the only effective mechanism for holding CBA to account for the cavalier disregard it appears to have shown for its continuous disclosure obligations. All that would do is send a signal to large corporations that they can ignore their continuous disclosure obligations with impunity. We have continuous disclosure laws for a reason. They promote the efficient allocation of capital by ensuring investment decision are made on the best available information. No one should sensibly regard an attempt to enforce those laws and obtain compensation for those affected by flagrant breaches of them as a bad thing. The problem here is not the class action but the underlying corporate misbehaviour that caused the class action. |
| “NAB identifies problems with its AML/CTF compliance controls” | Thomson Reuters Regulatory Intelligence | 15 November 2017 | Banks in Australia have become a lot more proactive about reporting potential compliance breaches to the market in the wake of the Commonwealth Bank AML/CTF enforcement action… Andrew Watson, head of Maurice Blackburn’s class actions team, said these shareholder actions could complement regulatory enforcement and could be a driver of change in corporate behaviour. “There is no doubt that class actions, such as the cases we've run, are bringing an additional element of accountability to boardrooms across corporate Australia," Watson said. "Our regulators — including the ACCC and ASIC — have both endorsed the complementary role class actions have in enforcing better standards of corporate conduct.” |
| "Exaggerated claims lack merit and muddy reform" | The Australian | 13 July 2018 | As the Australian Law Reform Council inquiry into class actions progresses, much continues to be made about the regime, including exaggerated and misleading claims on the number of class actions, the level of settlements and the costs of directors and offices insurance. Let’s start with two simple facts. In the past 26 years class actions have resulted in recoveries of more than $3.5 billion on behalf of everyday Australians who found themselves the victims of corporate misconduct. Class actions happen because companies break the law and cause significant losses for thousands of everyday Australians. Complaining about an increase in class actions when there has been a dramatic increase in the level of exposed misconduct makes about as much sense as complaining about increased prosecutions in response to a crime wave." … Class actions provide an important check and balance on misconduct – something that not only assists those who have been wronged but also serves to benefit the majority of companies that do the right thing and act within the law. In its recent report the Victorian Law Reform Commission sensibly has accepted that law reform in this area is about making a good system better and about increasing access to justice, not further restricting it. It is to be hoped that once the ALRC sifts through the noise of the defenders and insurers of corporate wrongdoers it will recognise the good sense of a similar approach. … Reform of our class action systems should be fact based and considered; it should not be responsive to the histrionic and exaggerated claims of those whose interests are in defending corporate wrongdoers and reducing payouts to victims. … The ongoing ALRC inquiry presents an important opportunity to make a good system better, most critically for class action claimants. What it should not be is an opportunity for sectional interests making exaggerated claims on behalf of corporate wrongdoers to wind back protections for everyday Australians affected by that misconduct. |
| "WOOLWORTHS: To Thoroughly Defend Shareholders' Class Action" | Class Action Prospector | 9 October 2018 | "Maurice Blackburn class actions principal Andrew Watson said the case reinforced the need for enhanced transparency and proper disclosures from large listed companies and ensured they were held to account if they failed to provide the market with accurate information." |
| "Myer class action judgment could chill company profit guidance" | Australian Financial Review | 26 October 2019 | "Mr Walker, the CEO of litigation funder Investor Claim Partner and president of the chairman of the Association of Litigation Funders, said "there was not enough loss" in the Myer claim to make it viable. "We had a look at the figures and they didn't stack up." He said the decision meant there was no more ambiguity around corporate continuous disclosure laws or market-based causation. "We can't go to mediations anymore and spend a lot of time and effort and money on arguing both sides of the fence." Andrew Watson, the head of Maurice Blackburn's class actions practice, said Justice Beach had shown that plaintiff claims had been proceeding on the right basis. You can give a forecast which is right at the time it's given because it is based on reasonable grounds. But at a subsequent point in time, you've got to inform the market that you no longer going to make it. "That's been clear for a very long time but we've got a judicial stamp on what most corporations would have regarded as good practice and common sense". |
| "Court delivers blows on class action lawsuits" | Sydney Morning Herald | 5 December 2019 | "John Walker, chairman of the Association of Litigation Funders of Australia, predicted "many claims won't proceed now that otherwise would have". Common fund orders require all members of a class action to contribute a percentage of any settlement or damages they receive, which can amount to tens of millions of dollars, to the litigation funder even if they have not personally signed any contract with the funder. Mr Walker said the decision would force litigation funders and law firms to return to signing up class action members individually in a process known as a "book build", which can involve media appeals, direct calls or online ads. "It's unfortunate," Mr Walker said. "It means that for a lot of consumer class actions where the group members are numerous but their claims are small individually, it often makes those claims commercially unviable because you need to book build a large volume of group members to make it commercially viable, and that's expensive... …. Maurice Blackburn's head of class actions, Andrew Watson, said class action would continue to run but that common fund orders had "increased access to justice for people who otherwise could not afford to make use of the courts"." |
| "Maurice Blackburn lodges shareholder class action against Treasury Wines" | Maurice Blackburn Lawyers | 1 May 2020 | "...shareholder class actions ensured companies that misinformed the market were held to account. "Good companies have nothing to fear from the existing laws and bad companies should not be given a free pass to engage in misleading or misinforming the market. A functioning class actions system is a deterrent to corporate malfeasance, and signals to both investors and consumers that wrongdoing comes at a price, bolstering confidence and ensuring the efficient allocation of capital in the market"." |
| "A plaintiff’s perspective on class actions: Part II" | Lawyer's Weekly | 16 November 2020 | "...Maurice Blackburn, and a number of other plaintiff law firms and litigation funders, have formed a group called Keep Corporations Honest, which is designed to ensure that there's a proper public debate about the class actions regime and the means by which corporations who engage in misconduct are held to account for their mass wrongs. So there will be an extensive and ongoing public campaign..." |
| "Maurice Blackburn settles class action against collapsed education provider Vocation" | Media Release | 30 November 2020 | "... Mr Watson said Australia's class action regime provided an important mechanism through which shareholders could recover losses caused by poor corporate behaviour. "Because we have an effective class actions regime in Australia, investors of all sizes can have greater faith in how our markets function, as these actions send a strong message about the importance of following good corporate governance in shareholders' interests," he said." |
| “Australia considers capping class action funders' fees" | Reuters News | 28 May 2021 | "Australia's government last year moved to tighten regulatory scrutiny of wealthy offshore and local litigation funders following a surge in successful class actions against companies in recent years. Litigation funders invest in consumer, investor and other lawsuits by groups that cannot afford them, by funding them in exchange for a share of any settlement or judgment. If the group of plaintiffs lose, it does not have to repay the financial investor. Companies such as Omni Bridgeway Ltd, formerly IMF Bentham, and Maurice Blackburn, have funded more than 300 class action suits in Australia, including against the country's major banks. A parliamentary report in December said Australia's light touch regulatory regime had created a global hot-spot for investors based in tax havens and with "dubious corporate histories" generating huge returns. It suggested 70% of the gross proceeds could be a minimum return for class action members. "This measure is of particular importance to ensure successful applicants are adequately compensated in their cases as well as preventing litigation funders and law firms from taking disproportionate fees in the process," Treasurer Josh Frydenberg said in a joint statement with the nation's Attorney-General. Litigation funders, however, say such a limit would be prohibitive for smaller cases given the high risk and costly nature of such lawsuits. In some cases, a 30% cap on gross returns would not even cover litigation costs, a PwC paper prepared for Omni Brideway [sic] in March showed. "The government's proposed cap on returns to litigation funders is a dangerous attack on the legal rights of Australians and will lead to corporate wrongdoing going unchecked," said Andrew Watson, national head of class actions at Maurice Blackburn, a law firm. "Litigation funders play a vitally important role in allowing access to justice for ordinary Australians who otherwise could not afford to launch legal cases to right wrongs"." |
| "Cash's class action laws are designed to help big business, not every day Australians" | Media Release | 30 September 2021 | "Ms Cash today released an exposure draft bill that would severely limit the ability to get worthwhile class actions off the ground, by applying a cap on class action funders and banning common fund orders (CFOs). Class Actions Australia spokesperson and Maurice Blackburn's National Head of Class Actions, Andrew Watson, said it was preposterous for the government to claim the laws were being introduced to help everyday Australians participating in class actions. "This isn't reform, its sabotage," Mr Watson said. "The Morrison Government wants class actions de-clawed and de-fanged so corporations can use their power and size to get away with hurting people. "Class actions are hugely expensive, because you are invariably taking on a giant with deep pockets and a lot to lose. They need funding options to survive. The government and the big business lobby knows if they take away the viability of those funding options they take away most class actions. That's the point of these proposed changes." … "Surely if you're introducing a measure to benefit class action members you would have talked to them first? Michaelia Cash hasn't met with people ripped off by insurance companies selling worthless products to the vulnerable. Or the women hurt by big pharma due to faulty pelvic mesh implants. Because she's not looking after victims, she's siding with wrongdoers"." |
| "Lawyer describes class action fee plans 'sabotage” | Australian Financial Review | 1 October 2021 | "Andrew Watson, national head of class actions at Maurice Blackburn, accused the government of trying to stop class actions in their tracks. "This isn't reform, it's sabotage ... The point of these law changes isn't to make class actions better, it's to throw so much sand in their gears they don't get off the ground," he said. "The government and the big business lobby knows if they take away the viability of those funding options, they take away most class actions"." |
| "The Future of Australian class action — policy forum" | Asia Pacific Policy Society | 16 February 2022 | "The government's new policies on litigation funding and class actions are causing regulatory chaos and will deprive ordinary Australians of fair legal representation, Andrew Watson writes. … Through a series of legislative interventions it has created regulatory chaos and will restrict the ability of everyday Australians to gain access to justice by restricting litigation funding." |
| "Changes afoot for Australia's class action laws" | Sydney Morning Herald | 1 October 2022 | "Andrew Watson, Maurice Blackburn principal class actions lawyer, is looking forward to the government's statutory review next year of the continuous disclosure law changes, changes which had such a dramatic impact on the sector. "I'm hoping that the review of those laws can be done without the hyperbole that accompanies some of the commentary from the business community about shareholder actions, and that we can restore the continuous disclosure laws to the position that they were, which everybody including ASIC as the regulator, regarded as world-class," Watson says. … Maurice Blackburn's Watson is also keen for the debate to be based on actuality rather than politics - though after three years of his industry feeling under attack, he's not putting his sword back in his sheath just yet." "All we expect from a Labor government is that it'll return to an evidence-based approach to class actions and litigation funding, as opposed to what was in the end just an ideologically driven kind of jihad against access to justice, which seemed to be the approach of the former government," he says." |
| "ALP 'good news' for class actions" | Australian Financial Review | 26 May 2022 | "Class action lawyers have welcomed Labor's election victory, which will stop moves to ensure funders get no more than 30 per cent of any payout and revive the push for law firms to charge contingency fees. Andrew Watson, the head of class actions at plaintiff law firm Maurice Blackburn, said it was "the end of a culture war" and he expected the Albanese government to ditch other Coalition reforms aimed at regulating the sector. … John Walker, the head of Investor Claim Partner and chairman of the Association of Litigation Funders, said Mr Dreyfus would "bring balance to the debate" and "act on the evidence". "The introduction of regulation of funded class actions as managed investment schemes is likely to be the subject of a cost-benefit analysis which I expect will lead to the regulations being dumped." Mr Walker and Mr Watson said they also expected Mr Dreyfus would "dust off" the report into litigation funding by the Australian Law Reform Commission, which recommended contingency fees... … Mr Watson, of Maurice Blackburn, said Labor's approach to reform would "be aimed at increasing access to justice for all parties, rather than simply engaging - as the Coalition did - in culture wars aimed at restricting access"." |
| “Albanese government starts to unwind Coalition's class actions reforms. The first step is removing regulatory oversight for litigation founders before the likely introduction of contingency fees" | Australian Financial Review | 8 September 2022 | "Maurice Blackburn's head of class actions, Andrew Watson, said repealing the Coalition regulations would "promote access to justice without detrimentally affecting protections for class members, whose interests will be jealously guarded by the courts". "We also particularly welcome the government's indication of a comprehensive response to the ALRC report rather than approach of the Morrison government which consisted of a sustained attack on access to justice in the interests of corporate wrongdoers." Veteran funder John Walker, of CASL, said the new regulations would "decrease the barriers put in place by the former government to diminish access to justice" and that the Law Reform Commission's report "has for too long sat on the shelf." |
| “What are class action lawsuits and are they common in Australia” | The Guardian UK | 11 March 2023 | While the number of new class actions dropped significantly last year, the preceding years were particularly busy. The main reason for that flurry stemmed from the banking royal commission, which found widespread misconduct when it reported its findings in early 2019. “Where there is misconduct, actions will follow,” says Andrew Watson, national head of Maurice Blackburn’s class action practice. |
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