Tides shift in Australia's class action landscape as Federal Court green lights solicitors' common fund orders

Written By

jonathon ellis Module
Jonathon Ellis

Partner
Australia

I'm a dispute resolution and regulatory investigations partner in our Sydney office. I work with clients to solve complex issues facing their businesses, whether that is a commercial dispute or engagement with regulatory agencies.

jonathan tay Module
Jonathan Tay

Senior Associate
Australia

I am a senior associate in the Dispute Resolution team in Sydney. I provide succinct, solutions orientated advice to help our clients solve complex problems, mitigate future risks and develop strategies to simplify their decision-making process.

The Full Court of the Federal Court of Australia determined  in a recent decision that the Federal Court has the power to make a Solicitors’ Common Fund Order (“SCFO”) in class action proceedings which open the door for class actions plaintiff lawyers to receive a contingency fee – i.e., a percentage from a class actions settlement or judgment. 

Prior to this decision, class action plaintiff law firms were only able to obtain contingency fees in the Supreme Court of Victoria, following the enactment of legislation in 2020 permitting group costs orders, which entitled lawyers to a percentage of any recovery. Historically, for this reason, the Supreme Court of Victoria has been the preferred jurisdiction for class actions lawyers who did not wish to engage with a third party funder to bring an action. 

This article discusses the Full Court’s decision and what this means for Australia’s class action landscape going forward. 

The decision 

The Full Federal Court found in R&B Investments Pty Ltd (Trustee) v Blue Sky (Reserved Question) [2024] FCAFC 89 that SCFO’s may be made under ss 33V or 33Z of the Federal Court of Australia Act 1976 (Cth) (Act).

The Full Court rejected the respondent’s contentions that SFCO’s would:

Full article available on Disputes +

Latest insights

More Insights
grass sports field with marking lines

English High Court flexes its pro-mediation powers in commercial disputes

Feb 07 2025

Read More
EU Flag

The End of the European Online Dispute Resolution Platform

Jan 24 2025

Read More
Curiosity line pink background

Hong Kong Dispute Digest January 2025

Jan 23 2025

Read More