King v GIO Australia Holdings Ltd - [2001] FCA 270

FEDERAL COURT OF AUSTRALIA
King v GIO Australia Holdings Ltd [2001] FCA 270
PRACTICE AND PROCEDURE – representative proceedings – form of opt-out notices – whether notice misleading by giving impression that group members represented by representative party’s lawyers for all aspects of proceedings – whether notice should refer to costs consequences of group member not opting out of the proceedings
Federal Court of Australia Act 1976 (Cth) ss 33J, 33Q, 33R, 33X, 33ZJ
Trade Practices Act 1974 (Cth) s 82
King v GIO Australia Holdings Ltd (2000) 100 FCR 209 referred to
Décor Corporation Pty Ltd v Dart Industries Inc (1991) 33 FCR 397 referred to
House v The King (1936) 55 CLR 499 referred to
Femcare Ltd v Bright (2000) 100 FCR 331 referred to
Australian Law Reform Commission, Grouped Proceedings in the Federal Court (ALRC 46)
SHANE ROBERT KING v GIO AUSTRALIA HOLDINGS LTD & ORS
N 955 of 1999
SACKVILLE, HELY & STONE JJ
SYDNEY
20 MARCH 2001

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N 955 OF 1999

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:

SHANE ROBERT KING
APPLICANT

AND:

GIO AUSTRALIA HOLDINGS LTD
FIRST RESPONDENT

GRANT SAMUEL & ASSOCIATES PTY LIMITED
SECOND RESPONDENT

DAVID MORTIMER
THIRD RESPONDENT

BRUCE HOGAN
FOURTH RESPONDENT

STEWART STEFFEY
FIFTH RESPONDENT

RONALD ASHTON
SIXTH RESPONDENT

MARINA DARLING
SEVENTH RESPONDENT

ANDREW KALDOR
EIGHTH RESPONDENT

LLOYD LANGE
NINTH RESPONDENT

DAVID O'HALLORAN
TENTH RESPONDENT

IAN POLLARD
ELEVENTH RESPONDENT

JUDGES:

SACKVILLE, HELY & STONE JJ

DATE OF ORDER:

20 MARCH 2001

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:
1.Leave be granted to appeal from Order 2 made on 20 December 2000 approving the form of notice which is Schedule 1 to the reasons of the primary Judge.
2.The appeal be allowed.
3.The form of notice be amended by the insertion of the following paragraphs between the two paragraphs presently appearing under the heading “If you do not Opt-Out” on page 3 of the notice:
- Furthermore, if you do not opt out of the proceedings you will be one of the group members on whose behalf the applicant is conducting the proceedings. Maurice Blackburn Cashman are representing the applicant in the proceedings. You will not be liable for their legal fees merely by remaining a group member. That is subject to the qualification that the court has power under s 33ZJ of the Act to order that the costs reasonably incurred by the applicant in prosecuting the claim, to the extent that they exceed the costs recoverable by him from the respondents, be paid to the applicant out of any damages awarded to class members in the proceedings. The applicant has indicated that, at the conclusion of the proceedings, he will seek an order to that effect.
- Unless the proceedings are settled, you will need to prove that you have individually suffered loss or damage because of the respondent’s conduct. To do this you are likely to need legal representation. If you want Maurice…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2001] FCA 270
Decision Date: 20 MARCH 2001

CaseChat Overview and Summary

King v GIO Australia Holdings Ltd involved a dispute over the adequacy of a notice sent to potential class members in a class action proceeding. The Court of Appeal was required to determine whether the notice provided sufficient information to enable potential class members to make an informed decision about whether to opt out of the proceedings. The Court also had to consider whether the notice complied with relevant statutory requirements and whether it was fair and balanced.

The primary issues before the Court were whether the notice was adequate in informing potential class members of their rights and obligations, and whether it complied with the relevant statutory provisions. The Court considered whether the notice provided sufficient information about the nature of the proceedings, the potential risks and benefits of joining the class action, and the potential costs and consequences of opting out. The Court also considered whether the notice was fair and balanced, and whether it complied with the requirements of the relevant legislation.

The Court held that the notice was not adequate in several respects. The Court found that the notice did not provide sufficient information about the potential costs and consequences of opting out, and that it was not fair and balanced. The Court also found that the notice did not comply with the relevant statutory provisions. The Court allowed the appeal, amended the notice, and remitted the proceedings to the primary Judge to make further directions as appropriate.

The Court made several orders, including granting leave to appeal, allowing the appeal, amending the notice, and remitting the proceedings to the primary Judge. The Court also ordered that the applicant pay the first respondent's costs of the application for leave to appeal and of the appeal. The Court's decision provides useful guidance for practitioners involved in class action proceedings, highlighting the importance of ensuring that notices to potential class members are fair, balanced, and compliant with relevant statutory requirements.

Orders

Orders of the court

1. Leave be granted to appeal from Order 2 made on 20 December 2000 approving the form of notice which is Schedule 1 to the reasons of the primary Judge.

2. The appeal be allowed.

3. The form of notice be amended by the insertion of the following paragraphs between the two paragraphs presently appearing under the heading “If you do not Opt-Out” on page 3 of the notice:

- Furthermore, if you do not opt out of the proceedings you will be one of the group members on whose behalf the applicant is conducting the proceedings. Maurice Blackburn Cashman are representing the applicant in the proceedings. You will not be liable for their legal fees merely by remaining a group member. That is subject to the qualification that the court has power under s 33ZJ of the Act to order that the costs reasonably incurred by the applicant in prosecuting the claim, to the extent that they exceed the costs recoverable by him from the respondents, be paid to the applicant out of any damages awarded to class members in the proceedings. The applicant has indicated that, at the conclusion of the proceedings, he will seek an order to that effect.

- Unless the proceedings are settled, you will need to prove that you have individually suffered loss or damage because of the respondent’s conduct. To do this you are likely to need legal representation. If you want Maurice Blackburn Cashman to act on your behalf for this purpose you will have to enter into a fee agreement with them. To obtain a copy of the fee agreement contact Maurice Blackburn Cashman at 550 Swanston Street, Carlton, Victoria (phone: (03) 9345 2700).

4. The proceedings be remitted to the primary Judge to make such further directions in relation to the notice, consistent with these reasons, as are appropriate.

5. The applicant pay the first respondent’s costs of the application for leave to appeal and of the appeal.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Neither party raised the issue that the “opt out” date specified in the notice, namely 23 February 2001, has already passed. This is a matter that the primary Judge will address. It may be that additional consequential amendments to the notice will also necessary. The proceedings should therefore be remitted to the primary Judge to make such further directions in relation to the notice, consistent with these reasons, as are appropriate.CONCLUSION The Court orders that:1.Leave be granted to appeal from Order 2 made on 20 December 2000 approving the form of notice which is Schedule 1 to the reasons of the primary Judge.2.The appeal be allowed.3.The form of notice be amended by the insertion of the following paragraphs between the two paragraphs presently appearing under the heading “If you do not Opt-Out” on page 3 of the notice:-Furthermore, if you do not opt out of the proceedings you will be one of the group members on whose behalf the applicant is conducting the proceedings. Maurice Blackburn Cashman are representing the applicant in the proceedings. You will not be liable for their legal fees merely by remaining a group member. That is subject to the qualification that the court has power under s 33ZJ of the Act to order that the costs reasonably incurred by the applicant in prosecuting the claim, to the extent that they exceed the costs recoverable by him from the respondents, be paid to the applicant out of any damages awarded to class members in the proceedings. The applicant has indicated that, at the conclusion of the proceedings, he will seek an order to that effect. -Unless the proceedings are settled, you will need to prove that you have individually suffered loss or damage because of the respondent’s conduct. To do this you are likely to need legal representation. If you want Maurice Blackburn Cashman to act on your behalf for this purpose you will have to enter into a fee agreement with them. To obtain a copy of the fee agreement contact Maurice Blackburn Cashman at 550 Swanston Street, Carlton, Victoria (phone: (03) 9345 2700).4.The proceedings be remitted to the primary Judge to make such further directions in relation to the notice, consistent with these reasons, as are appropriate.5.The applicant pay the first respondent’s costs of the application for leave to appeal and of the appeal.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N 955 OF 1999

BETWEEN:	SHANE ROBERT KING APPLICANT
AND:	GIO AUSTRALIA HOLDINGS LTD FIRST RESPONDENT GRANT SAMUEL & ASSOCIATES PTY LIMITED SECOND RESPONDENT DAVID MORTIMER THIRD RESPONDENT BRUCE HOGAN FOURTH RESPONDENT STEWART STEFFEY FIFTH RESPONDENT RONALD ASHTON SIXTH RESPONDENT MARINA DARLING SEVENTH RESPONDENT ANDREW KALDOR EIGHTH RESPONDENT LLOYD LANGE NINTH RESPONDENT DAVID O'HALLORAN TENTH RESPONDENT IAN POLLARD ELEVENTH RESPONDENT
JUDGES:	SACKVILLE, HELY & STONE JJ
DATE OF ORDER:	20 MARCH 2001
WHERE MADE:	SYDNEY