Stack v AMP Financial Planning Pty Limited - [2020] FCA 1839

FEDERAL COURT OF AUSTRALIA
Stack v AMP Financial Planning Pty Limited [2020] FCA 1839

File number(s): VID 489 of 2020
VID 566 of 2020

Judgment of: BEACH J

Date of judgment: 21 December 2020

Catchwords: GROUP PROCEEDINGS – practice and procedure – multiple group proceedings – consolidation of proceedings – cooperative litigation protocol – joint solicitors for the applicants on the record – potential conflict of interest – need for a contradictor to supervise the operation of litigation protocol – no contradictor necessary – costs of consolidation application – orders made

Case cited: McKay Super Solutions Pty Ltd (Trustee) v Bellamy’s Australia Ltd [2017] FCA 947

Division: General Division

Registry: Victoria

National Practice Area: Commercial and Corporations

Sub-area: Regulator and Consumer Protection

Number of paragraphs: 42

Date of hearing: Determined on the papers

Counsel for the Applicants: Mr AS Martin SC with Mr TL Bagley, Mr EL Olivier and Mr B O’Connor.

Solicitors for the Applicants in VID 489 of 2020: Shine Lawyers

Solicitors for the Applicants in VID 566 of 2020: Piper Alderman

Counsel for the Respondents: Mr RA Dick SC with Ms E Bathurst

Solicitors for the Respondents: King & Wood Mallesons

ORDERS

VID 489 of 2020

BETWEEN:
NIGEL PETER STACK

First Applicant

JULIE ROBINSON

Second Applicant

AND:
AMP FINANCIAL PLANNING PTY LIMITED (ACN 051 208 327)

First Respondent

HILLROSS FINANCIAL SERVICES LIMITED (ACN 003 323 055)

Second Respondent

AMP LIFE LIMITED (ACN 079 300 379)

Third Respondent

ORDER MADE BY:

BEACH J

DATE OF ORDER:

21 DECEMBER 2020

THE COURT ORDERS THAT:
1.Pursuant to rule 30.11 of the Federal Court Rules 2011 (Cth) (the Rules) and sections 33ZG(c)(iv) and 33ZF of the Federal Court of Australia Act 1976 (Cth) (the Act), this proceeding (Federal Court of Australia proceeding VID 489 of 2020) (the Stack Proceeding) be consolidated with Federal Court of Australia proceeding VID 566 of 2020 (the Winterton Proceeding), and the consolidated proceeding be known as Stack & Ors v AMP Financial Planning Pty Limited (ACN 051 208 327) & Ors and identified as proceeding VID 489 of 2020) (the Consolidated Proceeding).
2.The applicants in the Winterton Proceeding and the applicants in the Stack Proceeding are to be applicants in the Consolidated Proceeding (the Joint Applicants).
3.The respondents in the Winterton Proceeding and the third respondent in the Stack Proceeding are to be respondents in the Consolidated Proceeding (the Respondents).
4.Pursuant to rule 1.32 of the Rules and section 33ZF of the Act, Piper Alderman and Shine Lawyers (collectively, the Solicitors) be granted leave to be jointly named as the solicitors on the record for the Joint Applicants in the Consolidated Proceeding on the following bases:
(a)a litigation committee will be established comprised of an equal number of representatives from each of the Solicitors, which will be responsible for:
(i)making major decisions;
(ii)management of the litigation;
(iii)delegation of carriage and decision-making responsibility to one or other of the Solicitors in relation to any issue in the Consolidated Proceeding; and
(iv)determining the distribution and coordination of work…

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.

Continue reading Stack v AMP Financial Planning Pty Limited

Details

AGLC: Stack v AMP Financial Planning Pty Limited [2020] FCA 1839
Case: [2020] FCA 1839
Decision Date: 21 December 2020

CaseChat Overview and Summary

In the Federal Court of Australia, the applicants from two separate proceedings sought to consolidate their cases against AMP Financial Planning Pty Limited and related entities. The applicants from the Winterton Proceeding were represented by Piper Alderman, while the applicants from the Stack Proceeding were represented by Shine Lawyers. Both sets of applicants were funded by Woodsford Litigation Funding 2 LLP and Woodsford Litigation Funding 5 LLP. The applicants sought to consolidate their proceedings due to common issues of law and fact and to manage their joint legal representation efficiently.

The primary legal issue before the court was whether the consolidation of the proceedings was appropriate, and if so, what terms should govern the joint representation of the applicants by two firms of solicitors. The court had to consider whether the joint representation could be managed without a conflict of interest and whether a contradictor was necessary to supervise the operation of a litigation protocol. The court also needed to determine the costs associated with the consolidation application and the funding arrangements for the applicants.

The court found that consolidation was appropriate given the commonality of issues between the proceedings. It granted the consolidation and approved the joint representation of the applicants by Piper Alderman and Shine Lawyers, subject to specific conditions designed to manage potential conflicts of interest and to ensure efficiency in the litigation process. The court held that a contradictor was not necessary to supervise the operation of the litigation protocol. The costs of duplicative work performed by the joint solicitors were deemed not recoverable against the applicants or the respondents. The court also appointed an independent costs referee to monitor the work of the solicitors and provide recommendations to reduce costs and duplication. The court dismissed the interlocutory application filed by the respondents in one of the original proceedings.

In summary, the court consolidated the two proceedings into a single proceeding and outlined detailed conditions for the joint representation of the applicants by two firms of solicitors, including the establishment of a litigation committee, the engagement of a single set of counsel, and the appointment of a costs referee. The court also made orders regarding the costs of the consolidation application and the funding arrangements for the applicants.

Orders

Orders of the court

1. Pursuant to rule 30.11 of the Federal Court Rules 2011 (Cth) (the Rules) and sections 33ZG(c)(iv) and 33ZF of the Federal Court of Australia Act 1976 (Cth) (the Act), this proceeding (Federal Court of Australia proceeding VID 566 of 2020) (the Winterton Proceeding) be consolidated with Federal Court of Australia proceeding VID 489 of 2020 (the Stack Proceeding), and the consolidated proceeding be known as Stack & Ors v AMP Financial Planning Pty Limited (ACN 051 208 327) & Ors and identified as proceeding VID 489 of 2020) (the Consolidated Proceeding).

2. The applicants in the Winterton Proceeding and the applicants in the Stack Proceeding are to be applicants in the Consolidated Proceeding (the Joint Applicants).

3. The respondents in the Winterton Proceeding and the third respondent in the Stack Proceeding are to be respondents in the Consolidated Proceeding (the Respondents).

4. Pursuant to rule 1.32 of the Rules and section 33ZF of the Act, Piper Alderman and Shine Lawyers (collectively, the Solicitors) be granted leave to be jointly named as the solicitors on the record for the Joint Applicants in the Consolidated Proceeding on the following bases:

(a) a litigation committee will be established comprised of an equal number of representatives from each of the Solicitors, which will be responsible for:

(i) making major decisions;

(ii) management of the litigation;

(iii) delegation of carriage and decision-making responsibility to one or other of the Solicitors in relation to any issue in the Consolidated Proceeding; and

(iv) determining the distribution and coordination of work between Piper Alderman and Shine Lawyers;

(b) the Solicitors will work together to reduce duplication in work;

(d) one set of counsel will be engaged to represent the Joint Applicants and the group members in the Consolidated Proceeding;

(e) the primary determinants of the allocation of work will be facilitating the overarching purpose in section 37M of the Act and advancing the interests of group members having regard to:

(i) the skills and experience of the Solicitors and their respective staff;

(ii) the objective of ensuring that the total legal costs are reasonable and proportionate; and

(iii) the objective of minimising, to the greatest extent possible, the legal costs incurred through overlapping or duplicated work;

(f) the Joint Applicants will jointly:

(i) send all correspondence and other communications to the solicitors for the Respondents;

(ii) make any interlocutory applications that are necessary in the Consolidated Proceeding, save for any application in respect of non-common issues;

(iii) respond to any interlocutory applications filed by the Respondents in the Consolidated Proceeding;

(iv) retain, brief and instruct expert witnesses in the Consolidated Proceeding; and

(v) conduct the discovery process in the Consolidated Proceeding, including the coordination of electronic discovery, requests, processes and technology; and

(g) the Respondents need only produce one set of discovery documents to the Joint Applicants.

5. Costs incurred to date in the Winterton Proceeding are to be costs in the Consolidated Proceeding.

6. Costs incurred to date in the Stack Proceeding are to be costs in the Consolidated Proceeding.

7. The costs of any duplicative work performed in the Consolidated Proceeding on and after the date of these orders that is performed by reason of there being two firms jointly representing the Joint Applicants rather than one firm are:

(a) not recoverable against group members in the Consolidated Proceeding; and

(b) not recoverable against the Respondents in the Consolidated Proceeding.

8. In the event that the Joint Applicants are required to provide security for costs in relation to the Consolidated Proceeding, Woodsford Litigation Funding 2 LLP and/or Woodsford Litigation Funding 5 LLP (jointly and severally, the Funder) shall provide a form of security for costs as ordered by the Court or agreed to by the Respondents.

9. Without affecting the powers of the Court as to costs, in the event that an adverse costs order is made against the Joint Applicants in the Consolidated Proceeding, the Funder will each meet any such order.

10. By 4.00 pm on 8 February 2021, the Joint Applicants in the Consolidated Proceeding are to serve on the Respondents copies of a consolidated originating application and consolidated statement of claim which they propose to seek leave to file.

11. By 4.00 pm on 22 February 2021, the Respondents are to indicate whether they oppose the filing of the consolidated originating application and the consolidated statement of claim.

12. Pursuant to sections 33ZF(1) and 37P(2) of the Act, Valerie Higinbotham (the Costs Referee) be appointed as an independent costs referee for the purpose of:

(a) conducting inquiries every four months (commencing from the date of the making of these Orders) as to the question of whether there is unnecessary or excessive work (including any unnecessary or excessive duplication of work) being performed by the Solicitors in the Consolidated Proceeding, having regard to the matters set out in paragraphs (i) to (iii) of Order 4(e) above; and

(b) providing confidential written reports (of no more than 10 pages) to the Court and the Solicitors every four months (commencing from after the date of the making of these Orders) stating the Costs Referee’s opinion on the question set out at Order 12(a) above, including any recommendations for reducing duplication where identified or otherwise reducing costs.

13. The Solicitors must cooperate and provide such information, access to personnel and access to documents as the Costs Referee may require.

14. Without affecting the powers of the Court as to costs, the Joint Applicants are to be liable for the reasonable fees of the Costs Referee, which fees will become part of the Joint Applicants’ costs in the Consolidated Proceeding.

15. Subject to any further order of the Court, for the purpose of any order made pursuant to sections 33V or 33ZJ of the Act approving payment or part-payment of the Joint Applicants’ legal costs and disbursements out of any settlement sum or Court award of damages in the Consolidated Proceeding, the total amount so approved will not include an amount that is referable to costs identified by the Costs Referee as being incurred unnecessarily or unreasonably including costs for work that is unnecessarily or excessively duplicative.

16. The interlocutory application filed by the respondents in the Winterton Proceeding on 22 October 2020 (the Interlocutory Application) be dismissed.

17. The parties’ costs of the Interlocutory Application be their costs in the cause in the Consolidated Proceeding.

18. Liberty to apply on three days’ notice.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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File number(s):	VID 489 of 2020 VID 566 of 2020
Judgment of:	BEACH J
Date of judgment:	21 December 2020
Catchwords:	GROUP PROCEEDINGS – practice and procedure – multiple group proceedings – consolidation of proceedings – cooperative litigation protocol – joint solicitors for the applicants on the record – potential conflict of interest – need for a contradictor to supervise the operation of litigation protocol – no contradictor necessary – costs of consolidation application – orders made
Case cited:	McKay Super Solutions Pty Ltd (Trustee) v Bellamy’s Australia Ltd [2017] FCA 947
Division:	General Division
Registry:	Victoria
National Practice Area:	Commercial and Corporations
Sub-area:	Regulator and Consumer Protection
Number of paragraphs:	42
Date of hearing:	Determined on the papers
Counsel for the Applicants:	Mr AS Martin SC with Mr TL Bagley, Mr EL Olivier and Mr B O’Connor.
Solicitors for the Applicants in VID 489 of 2020:	Shine Lawyers
Solicitors for the Applicants in VID 566 of 2020:	Piper Alderman
Counsel for the Respondents:	Mr RA Dick SC with Ms E Bathurst
Solicitors for the Respondents:	King & Wood Mallesons

ORDER MADE BY:	BEACH J
DATE OF ORDER:	21 DECEMBER 2020