Rota v Fire Rescue Victoria

Federal Court of Australia|2024-04-24|Before: Anderson J

Pursuant to s 33V(1) of the Federal Court of Australia Act 1976 (Cth), discontinuance of the proceeding be approved.
Pursuant to Order 1, the proceeding be discontinued.
Pursuant to s 33V and s 33ZF of the Federal Court of Australia Act 1976 (Cth), any limitation period that applies to any of the class members to which the proceeding relates shall begin to run again from 60 days after the making of this order.
There be no order as to costs. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Introduction 1 By interlocutory application dated 26 July 2023, the Applicants seek leave pursuant to s 33V of the Federal Court of Australia Act 1976 (Cth) (Act) to discontinue this proceeding. 2 The Applicants, in support of the application, rely upon an affidavit of Sameh Morris Iskander (being the solicitor acting for the Applicants) made 26 July 2023, and a further affidavit made 24 August 2023.

The applicable principles 10 Section 33V of the Act prevents the discontinuance of a representative proceeding without the approval of the Court. It provides: 33V Settlement and discontinuance - representative proceeding (1) A representative proceeding may not be settled or discontinued without the approval of the Court. (2) If the Court gives such an approval, it may make such orders as are just with respect to the distribution of any money paid under a settlement or paid into the Court. 11 The principles that govern the Court's discretion to approve a discontinuance have been collated by Anastassiou J in Babscay v Pitcher Partners (2020) 148 ACSR 551; [2020] FCA 1610 (Babscay) and Murphy J in Wruck v Telstra Limited [2023] FCA 932 (Wruck). In summary: (a) The Court asks whether approving the discontinuance would be unfair, unreasonable or adverse to the interests of class members, including as between class members. The Court does not need to be satisfied that the discontinuance is positively in the interests of group members. Babscay at [25]-[29]; Wruck at [34]. (b) At the least, the Court will need to be satisfied that class members have been given notice of the proposal to discontinue the proceeding: Wruck at [20]-[21]. (c) The Court's task in considering whether to approve a discontinuance is different to its task in approving a settlement under section 33V of the Act: Babscay at [19]. This is due to the nature of a discontinuance, which has different legal consequences. A discontinuance is a unilateral act of an applicant, which (subject to cost consequences) puts the applicant in the same position as if the proceeding had not been commenced. As there is no agreement by which the proceeding is compromised, there can be no merger of the applicant's rights in the proceeding. As there is no judicial determination, there can be no res judicata or issue estoppel: Babscay at [20]-[22]. (d) Subject to those legal consequences, it is for the applicant to put before the Court any other incidental consequences for group members that may foreseeably arise by reason of the Court's approval to discontinue.

Consideration 12 For the reasons that follow, I will approve discontinuance pursuant to s 33V of the Act. 13 First, approval gives effect to the wishes of all Class Members. As Mr Iskander's supplementary affidavit establishes, all Class Members have been consulted about the proposed discontinuance and all of them have indicated their consent to this course by providing signed "Notice[s] to Discontinue". In these notices, all Class Members have advised in express terms that they consent to the discontinuance. 14 Second, there is the legal effect of the discontinuance which has been discussed in Babscay at [20]-[23]. Members of the class are returned to the same position they were as if the representative proceeding had not been commenced, subject to cost consequences and the effluxion of time in relation to any limitation periods. Following the discontinuance, any Class Member is free to commence their own legal proceeding concerning the same matters traversed in the ASOC if they are so advised. 15 Third, in relation to the cost consequences in this proceeding, there are none. The interlocutory application seeks a discontinuance on the basis that there be no order as to costs. The Respondent consents to this order. 16 Fourth, in relation to limitation periods, the Class Members have the benefit of section 33ZE of the Act. This provision has the effect of suspending the running of any applicable limitation period that applies to a claim of a Class Member upon the commencement of a representative proceeding, meaning no time is lost by reason of the representative proceeding continuing until discontinuance is approved.

Resumption of Limitation periods 17 There is at present a degree of uncertainty as to the proper interpretation of s 33ZE of the Act which gives effect to the suspension of limitation periods noted above: see Babscay at [33]-[34] and Wruck at [27]-[28]. Section 33ZE of the Act provides: 33ZE Suspension of limitation periods (1) Upon the commencement of a representative proceeding, the running of any limitation period that applies to the claim of a group member to which the proceeding relates is suspended. (2) The limitation period does not begin to run again unless either the member opts out of the proceeding under section 33J or the proceeding, and any appeals arising from the proceeding, are determined without finally disposing of the group member's claim. 18 The debate in the authorities is whether a discontinuance constitutes a 'determination' for the purposes of s 33ZE(2) of the Act such that time commences to run again on the discontinuance being approved. 19 One construction is that s 33ZE(2) is to be read as if it refers to a judicial determination. Under this approach, as a discontinuance would not constitute a judicial determination (given it is a unilateral act of a party), it would not result in the limitation period beginning to run again which may cause real unfairness to a respondent. 20 The other construction is that "determine" in s 33ZE(2) should not be construed narrowly so as to refer only to a judicial determination. Under this approach, a discontinuance would also have the effect of determining a proceeding, and therefore, would result in the limitation periods beginning to run again. 21 I prefer the latter construction, as did Anastassiou J in Babscay at [34], for it is more purposive and does not introduce the textual gloss that brings about this uncertainty. Proceedings are capable of being "determined" (ie finalised) by the act of filing a discontinuance. 22 It is not necessary for me to determine this issue if an order is made that limitation periods applicable to all Class Members begin to run again from 60 days of the orders for discontinuance. This was the form of order that Murphy J made in Wruck and has been jointly agreed to by the parties in this case. I therefore propose to make the same form of order in this application.

Disposition 23 I will make the following orders: (1) Pursuant to s 33V(1) of the Federal Court of Australia Act 1976 (Cth), discontinuance of the proceeding be approved. (2) Pursuant to Order 1, the proceeding be discontinued. (3) Pursuant to s 33V and s 33ZF of the Federal Court of Australia Act 1976 (Cth), any limitation period that applies to any of the Class Members to which the proceeding relates shall begin to run again from 60 days after the making of this order. (4) There be no order as to costs. I certify that the preceding twenty-three (23) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Anderson.

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