Bill Speech: Justice Legislation Miscellaneous Amendments Bill 2019
Ms SPENCE (Yuroke) (12:46): I am very pleased to add my contribution to the Justice Legislation Miscellaneous Amendments Bill 2019. The bill essentially covers three areas. Firstly, it amends the Supreme Court Act 1986 to introduce new group costs orders that will allow plaintiff lawyers in class actions to receive a percentage of any amount recovered for their costs with liability shared by all group members. Secondly, it amends the Local Government Act 1989 and the Magistrates’ Court Act 1989 to validate decisions made by improperly established municipal electoral tribunals and by reserve magistrates who continue sitting after their appointments have expired, and it provides affected persons with individual immunity for decisions that they made. And, thirdly, the bill makes minor and technical amendments to various provisions in justice acts to clarify and simplify their operation, including the Criminal Procedure Act 2009, the Evidence Act 2008, the Evidence (Miscellaneous Provisions) Act 1958, the Professional Standards Act 2003, the Oaths and Affirmations Act 2018 and the Sentencing Act 1991.
What I would like to focus my contribution on is the first area that this bill covers, that being the new group costs orders in class actions. Class actions, as we have heard from many speakers today, are a really important component of our legal system. They create economies of scale where six or more plaintiffs can combine their action to make it more financially viable to take a legal action—so the cost of bringing proceedings can be spread across many claimants. In doing so, access to justice is provided to a larger number of people than would otherwise be the case. If individuals were to take separate legal action, it may be unaffordable, and for other reasons it may be inaccessible.
This can be particularly important when the legal action is against a well-resourced defendant, such as large corporations or indeed governments, or when it is being taken by not so well-resourced plaintiffs, such as low-income earners. If we think about issues such as wage theft, consumer harm, silicosis and other forms of corporate wrongdoing, the benefits of class action become pretty clear.
However, there are still some issues with the system of class actions, and this bill gives effect to recommendation 8 of the Victorian Law Reform Commission’s Access to Justice: Litigation Funding and Group Proceedings report of March 2018, which, as mentioned, will allow plaintiff lawyers in class actions to receive a percentage of any amount recovered in proceedings for their costs through new group costs orders, with liability for those costs shared by all group members. When discussing what is referred to in that report as common fund orders, the commission notes that:
The class action regime in Victoria has proved to be an effective means of providing access to justice but appears to be underutilised. On average, only five proceedings have been filed each year.
It is quite interesting if you read the report to see the scope of what the class actions have been brought for. It is quite a broad report with quite interesting findings throughout it.
Currently it can be quite hard to find a person who is willing to act as the lead or the representative plaintiff in a class action on behalf of that group of claimants. There is a fear or an apprehension that they will face the burden of the legal costs if the matter is unsuccessful—that they might be made personally liable for meeting the costs of the other side. Whether that is a correct or a perceived fear, regardless, that is an apprehension, so that can be quite difficult. It seemed to be a major deterrent that needs to be addressed so that more Victorians can gain access to justice through the class action system. In some cases this is seen to be addressed through the legal practice acting on a no win, no fee basis or through the involvement of a litigation funder; however, where this is not the case the risk of personal liability has been seen to be quite a significant barrier to people participating in class actions.
As such, the Victorian Law Reform Commission did find that allowing lawyers to charge only a percentage of the settlement amount in return for indemnifying the lead plaintiff for the other side’s costs lowered the risk for a potential lead plaintiff, and that was what they referred to as a:
… measured and contained means of ensuring that the class action regime in Victoria is meeting the objectives for which it was established
It is also worth mentioning that in addition to the law reform commission, many others in the legal profession have expressed support for this bill. It has been mentioned by the opposition that there has been a range of views expressed in regard to this bill and that it has not all been support, and that is not surprising. The member for Burwood—where is Will?—mentioned in his contribution that the range of—
Mr Fowles interjected.
Ms SPENCE: Sorry, member for Burwood. He mentioned that it was completely unsurprising that there was a diverse range of views and provided a very good explanation why there would be a diverse range of views—because this bill may in fact empower the defendants and that might not be to the joy of large corporations, who may find more class actions being brought against them. However,
I do digress.
There have been a number of quite eminent people within the legal profession who have made statements of support. I will just mention a couple. Former Law Institute of Victoria president Stuart Webb stated that:
Enabling the Supreme Court to make group costs orders in class actions will mean that plaintiffs will bear a lower costs risk burden, and may facilitate the bringing of meritorious class actions which might not otherwise have been brought in the face of higher costs risks …
Again, this goes to increasing access to justice, which is incredibly important. The Consumer Action Law Centre backs the bill and has stated that it:
… will reduce barriers to class actions by allowing lawyers to receive a ‘contingency fee’, a fee that is calculated as a percentage of the settlement of damages.
The Victorian president of the Australian Lawyers Alliance, Jeremy King, has stated that the alliance:
… welcomes this legislation as it is will directly improve access to justice in Victoria … The new law will increase the flexibility and availability of funding which will enable more people to obtain justice through class actions.
Mr King also stated in an Age article by Tammy Mills on 2 February 2020 that:
It will clearly benefit vulnerable and disadvantaged individuals who may otherwise be unable to pursue a claim because of the cost …
As someone who worked as a volunteer solicitor in a community legal centre, I am and I have always been particularly interested in improving access to justice for those who face barriers in accessing the legal system. Those barriers can be financial or they can be circumstantial. If you are facing health issues, for instance, you might not be able to access the legal system. They can be cultural, where you might have a language barrier. A lack of understanding of the legal system can in itself be a barrier to accessing and pursuing the enforcement of legal rights, and class actions are one way of removing those barriers. Where there are multiple claims with the same or similar circumstances, bringing together multiple claimants can spread understanding.
Simply having a number of people sharing a circumstance can spread the understanding of legal matters. Like most things, when you bring together a group of people it is a great leveller—the increase in understanding and sharing that cost burden. This bill facilitates a greater use of class action through the use of these new group costs orders. It will allow plaintiff lawyers in class actions to receive a percentage of any amounts recovered for their costs, with the liability shared by all group members.
I thank the Attorney-General for once again bringing forward legislation that improves access to justice for those who might otherwise be denied that access, and I commend the bill to the house.
The SPEAKER: Before calling the good member for Bayswater I wanted to acknowledge in the gallery the presence of the Chinese Consul General to Victoria, Mr Long Zhou, and of course other representatives from his office as well. Welcome to the Parliament.
The Consul General has been invited today to the Parliament so that we can extend to him, and through to the Chinese people, our sympathy and best wishes in the face of the novel coronavirus outbreak. Our thoughts are with the people affected by this and with the health professionals that are dealing with the virus’s impact and trying to minimise that impact. We also stand with our local Chinese Victorian community, who are faced with a range of uncertainties through no fault of their own. Mr Consul General, we hope that you can take our message of support back to the Chinese people and also to the local Chinese community at this difficult time.