FEDERAL COURT OF AUSTRALIA

Neil v P & O Cruises Australia Limited [2002] FCA 1325

PRACTICE & PROCEDURE – representative proceeding – whether Court should approve proposed settlement – approach to be adopted to s 33V of Federal Court of Australia Act 1976 (Cth) – whether proposed settlement fair and reasonable – express consent of all adult group members obtained – group members include minors – informed consent of litigation guardians obtained – proposed settlement approved.

Federal Court of Australia Act 1976 (Cth) s 33V

Williams v FAI Home Security Pty Ltd (2000) 180 ALR 459 referred to

Lopez v Star World Enterprises Pty Ltd (1999) ATPR 41-678 referred to

MAIRI CHRISTINA NEIL, STEVEN BLACK, DAVID DELAHAYE and GIUSEPPE JOE FORGIONE v P & O CRUISES AUSTRALIA LIMITED (formerly known as P & O HOLIDAYS LIMITED) (ARBN 002 909 588), ANGELA MILNER (trading as Adventures in Paradise), BARU LIMITED (Registration No. 1-20919) (trading as Bluff Inn Motel), MARIA DAVIES (trading as Bluff Inn Motel) and FREDERICK GRAHAM DAVIES (trading as Bluff Inn Motel)

V314 of 1999

WEINBERG J

30 OCTOBER 2002

MELBOURNE

THE COURT ORDERS THAT:

1.         Approval be granted to the proposed settlement agreement between the group members and the first and second respondents dated 11 September 2002.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT

Introduction

1                     This is an application made pursuant to s 33V of the Federal Court of Australia Act 1976 (Cth) (“the Federal Court Act”) seeking the approval of this Court for a proposed settlement of a representative proceeding.

2                     On 11 June 1999 a claim was filed by Ms Clare Louise Giulieri on her own behalf and a class of persons (“the group members”) against P & O Holidays Limited, the first respondent.  On 7 July 1999, the claim was amended.  Ms Giulieri was removed as an applicant and replaced by Ms Mairi Christina Neil, Mr Steven Black and Mr David Delahaye.  On 17 September 1999 Mr Giuseppe Joe Forgione was added as a further applicant. 

3                     On 15 February 2000 P & O Holidays Limited brought cross claims against Ms Angela Milner (trading as Adventures in Paradise), and Baru Limited, Ms Maria Davies and Mr Frederick Graham Davies (all trading as Bluff Inn Motel).  On 3 July 2000 the applicants added Ms Milner, Baru Ltd, Ms Davies and Mr Davies as second to fifth respondents respectively.  On 25 September 2000, Ms Milner brought a cross claim against the third, fourth and fifth respondents.

4                     There are at present 107 group members in this representative proceeding.  Their claims arise out of a cruise on “The Fair Princess” conducted by the first respondent in 1999.  That cruise included a tour of the Kokoda Trail (the “Kokoda Tour”) which was organised by the second respondent which included a meal at a restaurant conducted by the third, fourth and fifth respondents.  A number of group members became seriously ill after consuming food and drink at the restaurant.  Others became ill after coming into contact with those who had consumed that food and drink. 

5                     The proposed settlement contains no admission of liability on the part of the first and second respondents.  The third, fourth and fifth respondents are not party to the proposed settlement.

Reasonableness of the proposed settlement

6                     The Court is required, upon an application for approval of a proposed settlement, to consider the fairness and reasonableness of that settlement.  I note the decision of Goldberg J in Williams v FAI Home Security Pty Ltd (2000) 180 ALR 459, and the list of factors identified by his Honour as being relevant to that task. 

7                     Ordinarily, not all group members to a representative proceeding will have retained the applicants’ solicitors, or any other solicitors for that matter.  In those circumstances the Court must be mindful of the interests of “unrepresented” group members, and would give careful consideration to the question whether the proposed settlement was in the interests of all group members.  However, in this case, each group member has retained, and been advised by, the firm of Slater & Gordon. 

8                     I was informed that each adult member of the group had been advised, on an individual basis, as to the merits of his or her claim.  Moreover, each of those persons had expressly consented to the terms of the proposed settlement. 

9                     I am satisfied, by reason of that fact, that I need not look beyond the express consent given by the adult members of the group in determining whether the proposed settlement is in their interests, or in the interests of all group members as a whole.  I should add, however, that I have considered the amount offered as a global sum, and the likely payment to be made to each member of the group who is eligible to be compensated.  I am satisfied that the amount offered represents a fair and reasonable sum in the resolution of this matter, having regard to the complexity of the issues involved, and the likely duration of the proceedings if this case were to proceed to trial. 

10                  I note, however, that several of the group members are “minors”.  A litigation guardian, or next friend, has acted on their behalf in consenting to the proposed settlement.  In Lopez v Star World Enterprises Pty Ltd (1999) ATPR 41-678 Finkelstein J stated at 42,671, in relation to the proposed settlement in that case:

“The settlement scheme makes specific provision for the protection of rights of persons under disability.  It contemplates that each person under disability will be represented by some person who by law is entitled to act on his or her behalf or by a solicitor.  It will be the obligation of the representative or solicitor to lodge a claim on behalf of the person under disability and there is every reason to assume therefore that all their claims will be properly made.  This is an adequate protection in my opinion.”

11                  An affidavit has been filed by the litigation guardian or next friend, a parent in each case, on behalf of each of the group members who are minors.  Those affidavits make it clear that the child’s parent has given careful consideration as to whether to accept the proposed settlement.  In each case, the written advice of counsel was obtained as to whether the offer should be accepted, and the child’s parent accepted that advice.  I am satisfied that the proposed scheme specifically contemplates the position of each minor, on an individual basis.  I am also satisfied that it is appropriate, in the circumstances, to approve the settlement accepted by the child’s parent in each case.

Conclusion

12                  I am satisfied, having regard to the matters set out above, that the informed consent of each group member has been obtained, and that the terms of the proposed settlement are fair and reasonable.  I am also satisfied that the fees to be paid to the applicants’ solicitors are commensurate with the work which has been performed, and that those fees are justified.  I therefore approve the proposed settlement.

Associate:

Dated:              30 October 2002