FEDERAL COURT OF AUSTRALIA

Ethicon Sàrl v Gill [2018] FCAFC 137

ORDERS

THE COURT ORDERS THAT:

1.    Time be extended to allow for the filing of the application for leave to appeal and leave be granted to appeal the orders of the primary judge made on 9 April 2018 insofar as they relate to the issue of group definition and restricted to ground 2 of the draft notice of appeal.

2.    The application for leave to appeal be otherwise dismissed.

3.    Insofar as it relates to ground 2, the draft notice of appeal stand as the notice of appeal.

4.    The appeal be allowed in part, and that in addition to the orders made by the primary judge on 9 April 2018, a further order be made that the amendment to the fifth amended statement of claim, insofar as that amendment relates to the definition of group members, take effect from the date of the filing of that document.

5.    Leave be granted to cross-appeal.

6.    The cross-appeal be dismissed.

7.    There be no order as to costs in relation to the applications for leave to appeal and cross-appeal and the appeal and the cross-appeal.

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

REASONS FOR JUDGMENT

THE COURT:

A.    Background AND Relevant Issues

1    These applications for extensions of time for leave to appeal and for leave to cross appeal are made in relation to interlocutory orders in a proceeding commenced pursuant to Part IVA of the Federal Court of Australia Act 1976 (Cth) (Act). The class action is maintained on behalf of three representative applicants who, together with group members, were surgically implanted with medical devices. To aid comprehension, we will describe the moving parties on the application for leave to appeal as the “respondents” and on the application for cross appeal as the “applicants” (so as to reflect the nomenclature of the substantive proceeding).

2    The devices were manufactured by two overseas companies (which are the first two respondents) and were sold in Australia by the third respondent. In broad summary, it is alleged that the devices were defective and/or unfit for purpose and that representations were made about them which contravened norms contained in the Trade Practices Act 1974 (Cth) and the Competition and Consumer Act 2010 (Cth). It is further alleged that the respondents were negligent. Monetary and non-monetary relief is sought. The class action was started in 2012, with the initial trial commencing in July 2017, and concluding in February this year. The primary judge has reserved her decision. In accordance with usual Part IVA procedure, that decision will resolve the whole of the individual claims of the three applicants, including any common issues resolved in the process of determining those claims. Following delivery of reasons, a s 33ZB order will be made. This will set out, with particularity, the extent of the statutory estoppel that will bind group members who have not opted out.

3    Following the conclusion of oral submissions at the initial trial, an interlocutory application was filed by which the applicants sought leave to amend the pleadings by filing a fifth further amended statement of claim (5FASOC). The amendments relevantly fall into two categories: first, to add an allegation that the respondents failed to give sufficient information or warning that the chronic inflammatory response to the implants may be affected by conditions including autoimmune and connective tissue disorders (Immune Response Amendment); and secondly, an amendment to alter the description of the group members (Group Definition Amendment). The primary judge allowed the relevant amendments, subject to a change as to the so-called “cut-off” date for claimants meeting the criteria for group membership. Additionally, although no specific order was made, her Honour also relevantly held that the Group Definition Amendment took effect from the time of the commencement of the proceeding in 2012 (Relation Back Issue). The respondents now seek leave to appeal from the Immune Response Amendment (Ground 1) and in relation to the Relation Back Issue. They contend that the Group Definition Amendment should have been ordered to take effect from the date of amendment (Ground 2).

4    The application for leave to cross-appeal also concerns the Group Definition Amendment, and is premised on the notion that the amendment expanded the class from women who suffered a complication prior to the date of commencement (October 2012) to women who suffered a complication prior to the date the hearing commenced (July 2017). Based on this premise, it is contended that the “cut-off” date for meeting the criteria for group membership should have been set as the date of judgment or approval of any settlement or, in the alternative, 9 April 2018 (being when leave was granted to make the Group Definition Amendment).

5    The application in relation to the Immune Response Amendment can be dealt with shortly. The applicants contended below that the allegations which were the subject of the Immune Response Amendment were already part of a broader pleaded case or, if not, were “relatively minor” and occasioned no prejudice because they were already part of the forensic battleground. The respondents contended to the contrary and further asserted that they had made forensic decisions on the basis of the pleaded case, including as to topics for cross examination of one of the applicants and an expert. To do justice to the arguments of both parties would require a close examination of the very extensive record below. There is no fetter on the respondents making complaint as to a want of procedural fairness, if it remains relevant, following delivery of judgment by the primary judge. If an appeal is brought by the respondents, it is likely that any complaint about the Immune Response Amendment would be part of a broader appeal and such an appeal would be a preferable forum for detailed examination of the way the issue was joined on the pleadings and how issues developed at the hearing. Leave to appeal to raise Ground 1 in the draft notice of appeal should be refused.

B.    Group Definition Amendment Generally

6    The Group Definition Amendment and, more particularly, the Relation Back Issue, are more problematical as the arguments of both parties before the primary judge were based on an incorrect premise. It is regrettably necessary to wade into the brume of the procedural history of this proceeding to explain why this is so.

B.1    The Evolving Group Definition

7    Two “gateway” provisions contained in Part IVA of the Act were relevant to the commencement of this proceeding. The first was s 33C, which only allowed the applicants to commence if: (a) seven or more persons had claims against the respondents; (b) the claims of all of those persons were in respect of, or arose out of, the same, similar or related circumstances; and (c) the claims of all of those persons gave rise to a substantial common issue of law or fact. The second “gateway” provision, s 33H, required the applicants to specify common issues and identify or describe the group members in either “the application commencing the proceeding or in a document filed in support of such an application”. Section 33H operates to ensure that the Court can assess, at the outset, whether the specified pre-conditions for the commencement of a class action (contained in s 33C) were present.

8    An originating application and statement of claim (SOC) was filed. Both the originating application and also the SOC described the group members as follows:

The Applicant (Mrs Davis) brings this proceeding as a representative proceeding pursuant to Part IVA of the Federal Court of Australia Act 1976 (Cth):

(a)        in her own right; and

(b)        on behalf of persons (Group Members) who had surgery performed on them in Australia to implant one or more of the following implants (Implants):

(i)        GYNECARE PROLIFT Total Pelvic Mesh Implant (the Total Implant);

(ii)       GYNECARE PROLIFT Anterior Pelvic Mesh Implant (the Anterior Implant); and/or

(iii)      GYNECARE PROLIFT Posterior Pelvic Mesh Implant (the Posterior Implant).

9    What then occurred is that this group definition was changed, on each occasion, by the filing of the following amended originating applications and pleadings on the following dates:

(a)    on 29 January 2013, by the filing of an amended originating application and amended statement of claim pursuant to an order made on 18 December 2012;

(b)    on 7 June 2013, by the filing of a further amended originating application and a further amended statement of claim pursuant to an order made on 5 June 2013;

(c)    on 24 November 2015, by the filing of a second further amended originating application and a second further amended statement of claim pursuant to an order made on 27 October 2015;

(d)    on 8 April 2016, by the filing of a third further amended originating application and a third further amended statement of claim (3FASOC) pursuant to an order made on 6 April 2016; and

(e)    on 16 April 2018, by the filing of the 5FASOC pursuant to an order made on 9 April 2018 (being the order which is the subject of the present applications).

10    For completeness, it is worth noting that a fourth further amended statement of claim (4FASOC) was filed in July 2017, but none of the amendments made by that document were related to changing the group definition. It follows that the change occasioned upon the filing of the 5FASOC (which specifies the composition of the current class), changed the class composition that had been in place since it was amended on 8 April 2016 (when the third further amended originating application and 3FASOC was filed).

11    It is unnecessary to detail the various iterations of the amendments to the group definition. For present purposes, it suffices to note that every amendment (in contrast to the group definition on commencement), defined the amended class by reference to group members satisfying three criteria:

(a)    they had surgery performed on them in Australia to implant one or more of the devices specified;

(b)    they were supplied with one or more of the devices for specified purposes; and

(c)    they have suffered from one or more complications, defined in the statement of claim, attributed to the devices and/or the consequences of surgical removal of the devices.

12    From an initial broad definition, as time went on, more specificity was given to the identification of the various implants and particulars were included in the definition as to the complications alleged. By April 2016, the group definition was changed to accommodate sub-groups being introduced (being the Mesh Sub-Group Members and the Tape Sub-Group Members), and two new applicants were added.

13    The applicants’ proposed changes set out in the draft 5FASOC also included an amendment that specified that the class was comprised of persons who “at any time (including after the commencement of these Proceedings)” had met the criteria specified. In this way the applicants sought to make explicit what (as we explain below) was the effect of the amendment absent any express time limitation. This aspect of the proposed amendment was rejected by the primary judge, who restricted the class to those that met the revised criteria immediately before commencement of the initial trial. The difficulty with the way argument proceeded before the primary judge was that the parties had paid insufficient or no regard as to how the previous group definition changes (see [9] above), all absent temporal limitations, had necessarily operated to capture the claims of all women who met the criteria specified in those definitions at the time those amendments had been made. We will come back to the legal effect of changes to group definition in section B.3 below. Before doing so, it is appropriate to turn first to the statutory provision pursuant to which class composition changes had been made (as contained in the amended originating application, the further amended originating application, the second further amended originating application and the third further amended originating application).

B.2    Amending Group Definitions

14    Section 33K of the Act makes provision for the amendment of group definitions as follows:

33K Causes of action accruing after commencement of representative proceeding

(1)    The Court may at any stage of a representative proceeding, on application made by the representative party, give leave to amend the application commencing the representative proceeding so as to alter the description of the group.

(2)    The description of the group may be altered so as to include a person:

(a)    whose cause of action accrued after the commencement of the representative proceeding but before such date as the Court fixes when giving leave; and

(b)    who would have been included in the group, or, with the consent of the person would have been included in the group, if the cause of action had accrued before the commencement of the proceeding.

(3)    The date mentioned in paragraph (2)(a) may be the date on which leave is given or another date before or after that date.

(4)    Where the Court gives leave under subsection (1), it may also make any other orders it thinks just, including an order relating to the giving of notice to persons who, as a result of the amendment, will be included in the group and the date before which such persons may opt out of the proceeding.

(Emphasis added)

15    The words emphasised above give rise to a possible complication: in the present case, by the time of the 4FASOC and the 5FASOC, the author of those documents only placed the group membership definition in the pleading (rather than repeating the previous practice of placing the definition in both the relevant application as well as the accompanying pleading).

16    When it came to the present application in relation to the 5FASOC, the primary judge, after making reference to some observations of Perram J in Gibson v Malaysian Airlines System Berhad (No 2) [2017] FCA 701, held that s 33K(1) was not the relevant source of power on the application because group members were not defined in the application. Perram J had concluded, in such a case, that the power to amend arose pursuant to FCR 16.53 (see Gibson at [7], [14]-[16]). In the present case, the primary judge considered the source of the power to be either FCR 1.40 (which provides the Court may exercise a power mentioned in the Rules); or FCR 1.41 (which gives the Court the power to grant an order sought by the party in an application).

17    The primary judge was, with respect, correct to have regard to the procedural quirk arising from an infelicity in the drafting of s 33K. As her Honour recognised, in circumstances where there was no definition in the application (which, as noted above, had been removed following the filing of the 4FASOC), a number of provisions in the Rules would support an order for amendment. Even more relevantly, the power to amend can be found within Part IVA itself, being the “gap filler” provided for in s 33ZF of the Act, which allows the Court to make any order the Court thinks appropriate or necessary to ensure that justice is done in the proceeding. As her Honour correctly observed, the real issue was discretion, not power.

18    The procedural history is relevant, however, because it demonstrates that by orders of the Court in December 2012, June 2013, October 2015 and April 2016 (Amendment Orders), leave was granted to amend the group definition contained in the originating application which necessarily amounted to the serial exercise by the Court of the power under s 33K. At all times, any change to a group definition in an originating application required leave to be granted pursuant to the power contained in that section.

19    The existence of these Amendment Orders and their significance was not a matter drawn to the attention of the primary judge. Indeed, it was not a matter to which reference was made by the parties in their submissions until it was raised by the Full Court at the oral hearing. When one has proper regard to the legal consequences of the original group definition and the Amendment Orders, it can be seen that argument before her Honour proceeded on the basis of a misapprehension as to both the then current composition of the class, and the extent of the then suspension of time limitations as to group member claims.

B.3    The Effect of the Amendment Orders on Class Composition

20    It is worth commencing with the common ground between the parties as explained to the primary judge.

21    During closing submissions, her Honour noted her understanding that the proceeding then covered only those women who were implanted with one or other of the devices in question up until the commencement of the proceeding. In the reasons of the primary judge, her Honour noted:

…that it was at least common ground at that point in time [that is, at the time of closing submissions] that women who had been implanted with a device before the commencement of the proceeding were group members and that the description would also capture those women whose complications had arisen afterwards but before the period in the opt-out notice had expired.

22    At some time this common position between the parties changed. By the time of written submissions on the present applications, both parties asserted that prior to the filing of the 5FASOC, the date by which group members had to have satisfied all criteria such that they were part of the group, was the date on which the proceeding was commenced, that is, 15 October 2012.

23    We have already observed that this common understanding was mistaken. In explaining this conclusion in more detail, it is necessary to revisit some fundamental aspects as to how group membership is defined in Part IVA proceedings.

24    As noted above, when commencing the proceeding, it was necessary for the applicants to describe or otherwise identify the group members to whom the proceeding related.  The group members were, as s 33A makes plain, “a member of a group of persons on whose behalf a representative proceeding has been commenced” (emphasis added). In identifying or describing those persons, it was not necessary to name them, nor to specify their number (see s 33H(2)), but it was necessary that the group membership be certain: see City of Swan v McGraw-Hill Financial Inc [2014] FCA 931; 223 FCR 328 at 332 [9] (Rares J).

25    As Lee J explained in Dillon v RBS Group (Australia) Pty Ltd [2017] FCA 896; 252 FCR 150 at 160-161 [50]:

It is important to bear in mind [a] fundamental concept which, although simple, is sometimes obscured: a group comprises persons and not the claims of persons. The best way of avoiding confusion is by imagining that a list of group members is always a list of names but, when actual names are not used, the “list” of persons is defined by a criterion (or more usually criteria) specified at the time the group is described. The identity of all persons is ascertainable and the characteristics describing membership, subject to leave under s 33K, will necessarily all be in existence immediately prior to the commencement of the proceeding on their behalf. The claims which are the subject of the proceeding are the entirety of the claim of each of those persons, which each existed separately from the proceeding.

26    It follows that when this proceeding was commenced, it was on behalf of identifiable women who, at the time of commencement, met two criteria being: (a) women who had surgery performed on them in Australia; and (b) being surgery to implant one of the three specified implants (as noted at [8] above). The definition was certain, and if those women were readily identifiable, it would have been possible to prepare a list of names. Unlike later, that original group definition did not have a criterion which restricted the class to those who had suffered any loss attributed to the devices. This does not mean the original group definition was non-compliant with Part IVA. The claims of group members (which is not the cause of action pleaded) had an existence independent of, and antecedent to, the commencement of the proceeding. It was not, of course, necessary that a claim had been made or asserted, nor was it necessary a claim amounted to a “right” or “entitlement” to relief (a matter which generally cannot be known until a final hearing): see Dillon at 159 [43]. In the context of the current proceeding, prayer one of the originating application claimed declaratory relief. Needless to say, the suffering of damage was not a necessary component of any claim which encompassed an alleged entitlement to that non-monetary relief. No suggestion is made that the representative proceeding was not validly commenced.

27    The effect of this valid commencement, was that the running of any limitation period applying to “the claim of any group member to which the proceeding relates” was suspended (s 33ZE(1)) and the limitation period did not begin to run again unless either: (a) the member opted out of the proceeding under s 33J; or (b) the proceeding and any appeals are determined without finally disposing of the group member’s claim (s 33ZE(2)). Notably, no reference is made in the Act to the limitation proceeding beginning to run when, as later occurred, some group members were excluded from the class by Court order upon amendments to the group definition. The legal consequences for individual claims (including the operation of s 33ZE) caused by the later exclusion of some group members, raise potentially complex issues which do not require further exploration in the present case.

28    What is important for present purposes is not any exclusion of persons by the terms of the four Amendment Orders, but the augmentation of the class which arose upon the amendments being made.

29    Part IVA puts in place an opt out regime. Irrespective of any positive step taken by a claimant, if at the time of an order which changes the group definition in a proceeding, they fall within the group definition as amended, they would become group members. The inclusion of claimants here occurred in the same way as would have been the case if group members had been listed in a schedule of names on commencement, and the amendment was to add to the schedule of names (as is sometimes the case). The new group members (who may have had no knowledge about being joined to the class) could then opt out; but subject to opt out, or a declassing order, or some form of exclusion order, they would remain group members and would, in time, generally be bound by either s 33ZB orders in relation to common issues, or by a settlement approved under s 33V.

30    Returning to the specifics of the Amendment Orders, the relevant group definition operating at the time of the application before the primary judge was defined by the order made in April 2016 (when, as noted above, the applicants were granted leave to amend the group definition to that contained in the third further amended originating application and the 3FASOC). This meant that on 8 April 2016, following the filing of the amending documents pursuant to the orders made on 6 April 2016, any person who now came within that group definition (but was not part of the group defined pursuant to the previous Amendment Order in October 2015) was added as a group member. The earlier Amendment Orders made in December 2012, June 2013, October 2015 operated in the same way.

31    Whenever claimants became group members by satisfying the then extant criteria, the limitation period was then suspended in relation to their claims. As noted at [27] above, if the “new” group member was also a group member that had been earlier excluded by previous amendments, the limitation consequences may be different, but it is unnecessary to express any concluded views as to that matter.

32    In any event, the April 2016 composition of the class was the group membership at the time the application to further amend the group definition came before the primary judge. Her Honour was at a disadvantage because both parties were operating under the misapprehension that the only persons within the group were those that met all three criteria prior to 15 October 2012. Regrettably this caused argument to be misdirected before the primary judge.

B.4    Should Leave be Granted in Relation to the Group Definition Issues?

33    No orders were made by the primary judge on 9 or 12 April 2018 which provided that the Group Definition Amendment related back to the time of commencement, although this was the intention of her Honour as explained in her reasons at [68] to [71]. This was no doubt because her Honour concluded that the “usual position” applied, being that an amendment takes effect from the date of commencement. The respondents’ complaint is that an order ought to have been made that the amendment should take effect from the date on which the amendment orders were made. The applicants’ complaint, in the application for leave to cross-appeal, is that the so-called “cut-off” date should have been set as the date of judgment or approval of any settlement or, in the alternative, the date of the order granting leave.

34    The granting of leave and the fixing of the “cut-off” date are discretionary decisions by a docket judge as to matters of practice and procedure. Moreover, supposing the primary judge erred, it is not clear that substantial injustice would result if leave was refused: cf Decor Corporation Pty Ltd v Dart Industries Inc [1991] FCA 844; 33 FCR 397 at 398-399 (Sheppard, Burchett and Heerey JJ). Having said this, the applications raise important issues as to the principled operation of Part IVA and, as explained below, we consider that the group definition should not relate back to the time of commencement. Accordingly, although no specific order was made as to the Relation Back Issue, leave should be granted to appeal and cross appeal with regard to those orders made on 9 April 2018 relating to the group definition amendment, including order 1(b) that:

1. Leave be granted to the applicants to:

…

(b) file an amended statement of claim in the form contained in annexure “B” to the amended interlocutory application dated 4 April 2018, save that the words “before 4 July 2017” be substituted for “(including after the commencement of these Proceedings)” in the definition of Group Members in paragraph 1(b).

C.    The “Cut-Off” Date

35    Order 1(b) was made as constituting the response to the question posed by the primary judge: What should be the cut-off date for the purposes of s 33K(2)? Strictly speaking, and with respect to her Honour, the way the question was framed was inapposite because this latest amendment was not to the originating application and s 33K was not engaged. Nothing, however, turns on this issue.

36    The applicants submitted that the cut-off date should be the date of judgment or approval of the settlement to ensure that the largest possible number of group members would be bound by the judgment or settlement (subject to opt out). The primary judge was correct to reject this submission on the basis that it was inappropriate to fix a cut-off date by reference to a future and uncertain date. In the same way as at the time of commencement of the proceeding, and at the time of the subsequent Amendment Orders, if leave to amend was allowed, it was necessary to have certainty as to class composition.

37    For the same reason as to why an “opt in” group definition is not allowed, it is foreign to the statutory scheme for group definitions to operate in an ambulatory fashion which allows the composition of the class to change automatically by the happening of an event post commencement: see Multiplex Funds Management Ltd v P Dawson Nominees Pty Ltd [2007] FCAFC 200; 164 FCR 275 at 280 [16]-[18] (per Lindgren J); 295 [142], 297 [168]-[171] (per Jacobson J with whom French J agreed). If there is to be a change to the persons constituting the class, an order is needed. Although s 33K(3) provides that the Court may set a date after leave has been granted, this is directed to circumstances where there is a gap between leave being granted and the amendment later becoming effective by the filing of the document effecting the amendment (as occurred here by the Amendment Orders). The circumstances when it would be necessary or desirable to pick a date further into the future are difficult to envision but if such circumstances did exist, a future date would need to be set so as to ensure that the requirement for class certainty during the currency of a Part IVA proceeding was not undermined and to allow opt out.

38    This notion of certainty is fundamental. Certainty of composition allows the Court to deal with the class when necessary for the purposes of the Part. For example, s 33J (affording the right to opt out); s 33L (identifying where there are less than seven group members); s 33Q (making orders as to the determination of issues where not all issues are common); s 33R (making orders as to individual issues); s 33S (making directions relating to the commencement of further proceedings by group members); s 33T (considering applications by group members as to adequacy of representation); s 33X (giving notice to group members of certain matters); and s 33ZB (making orders binding group members).

39    Obviously enough, this vice of inconclusiveness as to class composition is not present when a point of time is fixed by reference to an event that has already occurred. This is what happened here.

40    The primary judge fixed a cut-off date of 3 July 2017, being the day before the initial trial started. A factor that influenced her Honour in doing so was the general prohibition on the hearing of a representative proceeding beginning before the date by which a group member may opt out of the proceeding (see s 33J(4)).

41    The primary judge was alive to the benefit of incorporating as many women as possible in the class but considered that there was some tension between this outcome and the notion that opt out, for existing group members, should occur prior to commencement of the initial trial. Her Honour also recognised that having determined to grant leave to amend the group definition (and hence expand the class), it was necessary to provide a right to opt out to new group members exercisable after the initial trial had commenced. As it was necessary for those new group members who were included in the class to have the opportunity to opt out, it is not self-evident as to why it would not have been appropriate for others, whose claim arose after 4 July 2017 but before the leave application, to also be included (subject to opt out).

42    Having noted this, the group definition “cut-off” chosen by her Honour was one that was open and provided a licit group definition. Her Honour considered the risk of multiplicity and took it into account. There is no reason why we should interfere, simply because a different date could have been chosen. This conclusion is dispositive of the cross appeal.

43    This conclusion is fortified by the fact that an opt out notice has now been provided to group members pursuant to orders made on 12 April 2018. That notice, prepared by the parties, reflected the misconceptions explained above as to class composition, but was accurate in noting that persons were group members if they had suffered pleaded complications up until 4 July 2017. All current group members have now had the opportunity to opt out. It would cause unnecessary expense and possible confusion if yet another opt out notice was sent.

D.    The Relation Back Amendment

44    Ground 2 in the draft notice of appeal includes contentions that the primary judge’s discretion miscarried in failing to order that the amendment should take effect from the date of the order because the primary judge: (a) failed to take into account a material consideration, namely that each new group member had a different accrual date for their causes of action; and (b) acted upon a wrong principle or took into account an irrelevant matter, namely “that the usual position is that an amendment to a pleading or originating process takes effect from the commencement of the proceeding”, when the primary judge was determining an amendment that expanded class membership.

45    Given the misapprehension as to class composition, it was understandable that before the primary judge, the respondents emphasised the fact that each new class member had a different accrual date for their cause of action sounding in monetary relief. The respondents have pleaded various limitation provisions as against all group members (although why it is presently necessary to plead defences to individual claims for group members whose claims are not being determined at the initial trial is unclear). In any event, by allowing the Group Definition Amendment to relate back, it was said that the primary judge deprived the respondents from relying on those limitation provisions as against the new class members. This was thought to be relevant as all the consumer claim limitation provisions are three years fixed by reference to when the group member became aware, or ought to have become aware, of matters relevant to the accrual of a cause of action (the so-called “discoverability” provisions). The claims in negligence, of course, will be governed by the applicable State or Territory limitation legislation picked up under s 79 of the Judiciary Act 1903 (Cth).

46    By way of example, the respondents asserted that they will not be able to argue that an individual with an implantation date in 2013 and a pleaded complication in 2014 is barred from bringing a claim under cl 143 of the Australian Consumer Law (Schedule 2 of the Competition and Consumer Act 2010 (Cth)) because the amendment is taken to have been made on 15 October 2012. This ignores the fact, explained above, that such a person became a group member by the filing of a second further amended originating application pursuant to an order made amending the group definition in October 2015 (provided they met the other criteria in that group definition as at the amendment date).

47    Be that as it may, the point of principle raised by the respondents has substance for two reasons. The first is that it is somewhat an overgeneralisation to say that the “usual position” is that an amendment of a statement of claim takes effect from the commencement of the proceeding. As Perram J explained in Voxson Pty Ltd v Telstra Corporation Limited (No 7) [2017] FCA 267; 343 ALR 681, the former rules provided that a respondent should not generally lose its right to a successful limitation defence where an amendment arose out of facts which were not substantially the same by making provision for an “otherwise order”: see former O 13, r 3A. Notwithstanding the new rules were not intended to operate differently, there is no analogue under the current rules to the former O 13, r 3A. Although it is undoubtedly the case in ordinary inter partes litigation, that amendments often take effect from the commencement of the proceeding, this is in circumstances where the amendment is to add a claim between existing parties that arises out of the same or substantially the same facts. This flexibility operates as an amelioration of the rule of practice established by Weldon v Neal (1887) 19 QBD 394. As the case law has developed, to the extent that there is a usual position, it is as explained by Brereton J in Street & 7 v Luna Park Sydney Pty Ltd [2006] NSWSC 230 at [46] to [47]:

It is true that ordinarily “an amendment, duly made, takes effect, not from the date the amendment is made, but from the date of the original document which it amends” [Baldry v Jackson [1976] 2 NSWLR 415, 419 (Samuels JA)]. Since Baldry v Jackson, there has been considerable judicial discussion of this “relation-back” doctrine, in the context of limitation periods [Liff v Peasley [1980] 1 All ER 623, 641-643 (CA); [1980] 1 WLR 781, 802-804; Ketteman v Hansel Properties Ltd [1987] AC 189 (HL); Wenham v General Credits Ltd (NSWSC, McLelland J, 16 December 1988, unreported); Fernance v Nominal Defendant (1989) 17 NSWLR 710 (NSWSC); Wardley Australia Ltd v State of Western Australia (1992) 175 CLR 514, 559-562 (HCA); Morgan v Banning (1999) 20 WAR 474 (WASC, FC); Agtrack (NT) Pty Ltd v Hatfield (2003) 7 VR 63 (VCA); Agtrack (NT) Pty Ltd v Hatfield (2005) 218 ALR 677 (HCA)]. Generally, these cases have dealt with the relation-back doctrine in the context of two categories of amendments: those which would add a new defendant after the applicable limitation period against that defendant had expired, and those which would introduce a new cause of action after the limitation period for its commencement had expired.

As to the first, it is clear that the relation-back principle does not apply to an amendment which adds a party: where a party is added, proceedings against it are commenced only at the date of its joinder, so that the relation-back doctrine does not deprive a party joined after expiry of a limitation period of its limitation defence [Liff v Peasley; Ketteman v Hansel Properties; Wenham v General Credits; Fernance v Nominal Defendant].

48    These principles were referred to in the different context of representative proceedings by Perram J in Gibson at [33], where his Honour articulated that “the analogy between the joinder of a new party and the amendment of a class definition may be sufficiently close to suggest that an amended class definition should date from its amendment”.

49    The second difficulty is more significant and relates to the inaptness, or at least the limitations of, drawing analogies between aspects of ordinary inter partes litigation and Part IVA procedures. Although s 33ZG provides that nothing in Part IVA affects the Court’s powers under other provisions, Part IVA provides its own bespoke and detailed regime and, in significant respects, the evident purpose of the Part is to displace generally understood procedures: see Wong v Silkfield Pty Ltd [1999] HCA 48; 199 CLR 255 at 260-261 [11] (Gleeson CJ, McHugh, Gummow, Kirby and Callinan JJ).

50    By the amendment of a group definition, a new group member affected is not becoming a party, still less is the group member an existing party seeking to bring a new cause of action arising out of similar circumstances. The legal consequence is that the claim of a new group member, which claim gives rise to at least one substantial issue of law or fact with others, has become subject to the operation of the Part, subject to opt out or declassing. When one recognises that the regime expressly contemplates and provides for the individuality of claims within a group proceeding, what is brought into focus is that an order for amendment, which has the consequence of expanding the group definition, is sui generis and that analogies drawn from other contexts are apt to mislead.

51    It is consistent with the scheme introduced by Part IVA and, in particular, the need for there to be certainty as to the persons who comprise the class at all times, that the Group Definition Amendment should have been ordered to take effect from the date of amendment, being the date of filing of the 5FASOC. To adopt that course is consistent with the expansion of the class effected by the earlier Amendment Orders which, unfortunately, were not drawn to the attention of the primary judge in the present context. Apart from anything else, this prevents the topsy turvy notion that someone retrospectively becomes a group member on commencement, when the Court has thus far proceeded on the basis that they are not group members. As a matter of principle, such an approach would avoid the vice of potentially resuscitating causes of action by persons who have never sought to agitate them. It would be odd that by becoming a group member through the augmentation of a class, substantive rights were conferred on a claimant that had been either extinguished or barred by operation of statute and could not otherwise be advanced by that claimant.

52    Before leaving this topic it is worth making a further point. Given the suspension of limitations caused by the operation of s 33ZE, the question of inclusion (or, as occurred here, unusually, exclusion) of group members has potentially important consequences on substantive rights. As does the date when any such order is to take effect. Whatever might be the nature of other amendments to a statement of claim, or to relief claimed in an application, attention must be given by parties to the legal consequences of class composition changes. Irrespective as to when other amendments might take effect, the consequences of amendments to group definition can affect the rights of third parties, being the absent group members or proposed group members. Although it would be inappropriate to lay down inflexible rules, the default position is that a s 33K order (or an equivalent order under s 33ZF) has effect from the time the definition is changed, consistent with the requirements of class certainty. It is a sound practice for applicants, in seeking such orders, to deal separately with amendments concerning class composition to assist in avoiding any confusion.

E.    Disposition & Costs

53    The application for leave to appeal was filed out of time and a cross appeal was filed, purportedly in accordance with FCR 36.21, even though no notice of appeal had been filed. Nothing substantive arises from this, there is no prejudice, and we have dealt with the applications on their merits.

54    The respondents have been successful in securing an order that the amendment to the group definition in the 5FASOC dates from the filing of that document. Despite this, argument was advanced before the primary judge (and in written submissions to the Full Court) based on an incorrect premise. Additionally, the appeal in relation to order 1(b) of her Honour’s orders, together with the balance of the application for leave to appeal, has been unsuccessful. Similarly, the applicants have failed to appreciate the composition of the class that they represent. Like Molière’s Monsieur Jourdain speaking in prose, by the Amendment Orders, the applicants were augmenting the size of the group without turning their mind to the fact that they were doing so. They were also unsuccessful in relation to the cross-appeal. In all the circumstances the appropriate order is that there be no order as to costs associated with the applications or the appeal and cross-appeal.

Associate:

Dated:    23 August 2018

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