Tate v Westpac Banking Corporation (Common Fund Orders)

[2019] FCA 405

FEDERAL COURT OF AUSTRALIA

Tate v Westpac Banking Corporation (Common Fund Orders) [2019] FCA 405

File number:	VID 145 of 2019
Judge:	PERRAM J
Date of judgment:	25 March 2019
Catchwords:	REPRESENTATIVE PROCEEDINGS – representative proceeding under Part IVA of the Federal Court of Australia Act 1976 (Cth) – application for common fund order – whether order appropriate prior to filing and service of Statement of Claim – consideration of Class Actions Practice Note
Legislation:	Federal Court of Australia Act 1976 (Cth) ss 33X, 33Y
Date of hearing:	22 March 2019
Registry:	New South Wales
Division:	General Division
National Practice Area:	Commercial and Corporations
Sub-area:	Regulator and Consumer Protection
Category:	Catchwords
Number of paragraphs:	8
Counsel for the Applicants:	Mr C M Caleo QC and Mr C Batley
Solicitor for the Applicants:	Maurice Blackburn
Counsel for the Respondent:	Mr J Kirk SC and Mr J Williams
Solicitor for the Respondent:	King & Wood Mallesons

REASONS FOR JUDGMENT

VID 145 of 2019

BETWEEN:

IAN JOHN TATE

First Applicant

MICHELLE MARY TATE

Second Applicant

AND:

WESTPAC BANKING CORPORATION ACN 007 457 141

Respondent

PERRAM J:

1. The Applicants have applied for the following orders:

   …

   Common fund order

   7.        By 4.00 pm on 17 May 2019, the Applicants file and serve:

   a.any application for a common fund order (‘Common Fund Application’); and

   b.the proposed content of Notice of Common Fund Application;

   8.By 4.00 pm on 17 May 2019 the Respondent to file and serve an affidavit deposing to the nature and form of data in its possession, custody or control, in respect of the contact details of natural persons who had entered into residential loans with it since January 2011;

   9.        The proceeding be listed at [time] on [date] 2019 for the purpose of:

   a.        approval of the content of the Notice of Common Fund Application;

   b.orders for distribution of the Notice of Common Fund Application; and

   c.setting the time table for remaining steps of the Common Fund Application.

2. The Respondent objects to proposed order 8. There is no doubt that the Court has the power to direct that any common fund application be sent to the group members under s 33X(5) of the Federal Court of Australia Act 1976 (Cth) (‘the Act’). It provides that ‘[t]he Court may, at any stage, order that notice of any matter be given to a group member or group members.’

3. There is also no doubt that the Court has power to direct a respondent to provide information which is relevant to the giving of a notice. It is conferred by s 33Y(3)(c):

   33Y     Notices--ancillary provisions

   …

   (3)      The Court must, by order, specify:

   (a)       who is to give the notice; and

   (b)       the way in which the notice is to be given;

   and the order may include provision:

   (c)directing a party to provide information relevant to the giving of the notice; and

   (d)       relating to the costs of notice.

4. Section 33Y(5) places a limitation on the exercise of the power:

   The Court may not order that notice be given personally to each group member unless it is satisfied that it is reasonably practicable, and not unduly expensive, to do so.

5. I am prepared to assume in the Applicants’ favour that this limitation can be overcome on the present application. Further, although the effect of the order sought is that many Westpac customers will receive notice of the common fund application who are not members of the group, I am also prepared to assume that s 33X(5) authorises notification of a larger class of persons than the actual group where that is necessary in order to contact group members.

6. However, I am not prepared to make these orders at this stage.  This is because the Applicants have not yet articulated what their case is.  Clause 3.1 of the Court’s Class Actions Practice Note (GPN-CA) (‘Practice Note’) provides that ‘[i]t will usually be the case that the concise statement pleadings process … will be inappropriate for use in class actions.’  Despite that statement the Applicants have elected to commence this class action by means of the much more informal concise statement procedure.  In doing so, they have shirked the burden of articulating what their case is.

7. Class action litigation is not the same as ordinary litigation and different procedural mechanisms are often deployed to assist in the resolution of the complex and novel situations which can arise. All of these mechanisms have one common theme: they are very expensive and burdensome. I am not prepared to unleash the class action machinery (of which common fund orders are but part) until the Applicants put up an articulated claim in accordance with the Practice Note. Although s 33Y(5) is not directed at the situation presented by order 8, its emphasis on undue expense informs this decision.

8. At the case management hearing last Friday morning, I directed the Applicants to file a statement of claim by 14 May 2019.  At the next case management hearing on 25 June 2019, the topic of the common fund order may be revisited.

I certify that the preceding eight (8) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Perram.

Associate: 

Dated:       25 March 2019