FEDERAL COURT OF AUSTRALIA

Hadchiti v Nufarm Limited [2012] FCA 1524

THE COURT ORDERS THAT:

1.    The group members identified in the List of Participating Group Members filed with the Court on 27 November 2012, pursuant to paragraph 2 of the Orders of Justice Middleton dated 23 November 2012 are deemed to have registered a claim in this proceeding and to be eligible to pursue a claim for compensation in the proposed settlement of this proceeding (Participating Group Members).

2.    Paragraphs 8 and 9 of the Orders of Justice Middleton dated 11 September 2012 are otherwise confirmed.

3.    Pursuant to section 33V of the Federal Court of Australia Act 1976 (Cth) (Act), the proposed settlement of these proceedings, as reflected in the:

a.    Settlement Agreement (at annexure BJYP-1 of the confidential affidavit of Benjamin James Yang Phi affirmed on 27 November 2012);

b.    Settlement Variation Agreement (at annexure BJYP-12 of the confidential affidavit of Benjamin James Yang Phi affirmed on 27 November 2012);

c.    Settlement Distribution Scheme at annexure BJYP-3 of the confidential affidavit of Benjamin James Yang Phi affirmed on 27 November 2012; and

d.    Confidential Loss Assessment Formula at annexure BJYP-3 of the confidential affidavit of Benjamin James Yang Phi affirmed on 27 November 2012.

(Settlement Documents)

be approved.

4.    Pursuant to section 33ZB(a) and section 33ZF of the Act, the persons affected and bound by the settlement of the proceedings be the applicants, the respondent and the group members (as defined in the Second Further Amended Originating Application).

5.    The applicants be authorised nunc pro tunc on behalf of group members to enter into and give effect to the Settlement Documents and the transactions thereby contemplated for and on behalf of those group members.

6.    Pursuant to section 33ZF of the Act, Slater & Gordon and Maurice Blackburn be appointed Joint Administrators of the Settlement Distribution Scheme and to act in accordance with the rules of Settlement Distribution Scheme.

7.    Pursuant to section 33ZF of the Act, the costs and disbursements of the applicants in conducting the proceedings and of obtaining settlement approval be approved in the amount referred to in the report of Ian Ramsey-Stewart, cost assessor, annexed to the affidavit of Ian Ramsey-Stewart affirmed on 27 November 2012.

8.    That subject to further order, pursuant to section 50 of the Act, the following evidence be made confidential, forbidden from publication, and be sealed on the Court file in envelopes marked “Not to be opened except by leave of the Court or a Judge”:

a.    the affidavit of Benjamin James Yang Phi affirmed on 27 November 2012 and its annexures;

b.    annexure JAG-1 to the affidavit of Jason Andrew Geisker sworn on 27 November 2012;

c.    the affidavit of Oscar Louis McLaren affirmed on 27 November 2012 and its annexures;

d.    the affidavit of Ian Ramsey-Stewart affirmed on 27 November 2012 and its annexures.

9.    The costs and disbursements of Slater & Gordon and Maurice Blackburn in acting as Joint Administrators of the Settlement Distribution Scheme be the subject of a further report to be filed by Ian Ramsey-Stewart, cost assessor, and the amount the subject of that report be approved subject to any party or the Court requiring that the matter be mentioned before the Court.

10.    That pursuant to section 33ZF of the Act, the amount of:

a.    $6,297.50 be approved as the amount of the “First Applicant’s Expense Claim” for the purpose of the Settlement Distribution Scheme;

b.    $7,392.00 be approved as the amount of the “Second Applicant’s Expense Claim” for the purpose of the Settlement Distribution Scheme;

c.    $1,530.00 be approved as the amount of the “Third Applicant’s Expense Claim” for the purpose of the Settlement Distribution Scheme;

d.    $285.00 be approved as the amount of the “Fourth Applicant’s Expense Claim” for the purpose of the Settlement Distribution Scheme

11.    Slater & Gordon and Maurice Blackburn have liberty to apply for directions in connection with the Settlement Distribution Scheme.

12.    All costs orders made to date in the proceedings be vacated.

13.    The amount of $300,000 lodged as security in the proceeding be released to the applicants’ solicitors.

14.    There be no order as to the costs of the proceeding.

15.    The applicants to re-list the proceeding as soon as practicable after the completion of distribution of the Settlement Sum within the meaning of the Settlement Distribution Scheme so that final orders can be made, including orders that the proceeding be dismissed.

16.    Any such other order as the Court sees fit.

17.    Liberty to apply on two days’ notice.

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

REASONS FOR JUDGMENT

1    I have before me a representative proceeding where settlement, in principle, has been reached between the parties. Application for approval of the settlement has now been made under s 33V of the Federal Court of Australia Act 1976 (Cth) (‘the Federal Court Act’). Application has also been made for orders under s 33ZF of the Federal Court Act consequential upon or forming part of the settlement.

2    My principal task is to determine whether the settlement is a fair and reasonable compromise of the claims made on behalf of the group members in the proceeding.

3    There are a number of matters which the Court needs to consider in undertaking this task. These matters include the complexity and duration of the litigation, the reaction to the proposed compromise by group members, the stage of the proceedings, the risks involved in the litigation, the reasonableness of the compromise amount and the ability of a respondent or respondents to satisfy any amount ordered to be paid, both now and in the future.

4    In approving settlements, the Court necessarily relies upon counsel representing the parties, any counsel representing any person objecting to the approval, and the Court’s own independent assessment of the evidence and the submissions placed before it. Although onerous a task it is, there is a level of jurisprudence now well established which sets out the principles to adopt in considering whether the settlement is fair and reasonable.

5    Recent cases have re-iterated the relevant principles to apply: see eg Brisbane Broncos Leagues Club Ltd v Alleasing Finance Australia Pty Ltd (No 2) [2012] FCA 1112; Kirby v Centro Properties Ltd (No 6) [2012] FCA 650; Hobbs Anderson Investments Pty Limited v Oz Minerals Limited [2011] FCA 801; and Pharm-a-Care Laboratories Pty Ltd v Commonwealth of Australia (No 6) [2011] FCA 277.

6    It is unnecessary for me to repeat the principles set out in these authorities; it is sufficient to say that the Court will not approve a settlement unless it is satisfied that it is in the interests of the group members as a whole and not merely in the interests of the applicant and respondent.

7    I have been provided with evidence and material in relation to each of the matters referred to in paragraph [3] above, and a very useful affidavit summary provided by Benjamin James Young Phi, a legal practitioner acting for some of the applicants in the proceeding. The affidavit sets out the procedural matters involved in reaching this stage of the proceeding, and considers the relevant matters explaining the reasonable and fair nature of the settlement, including the issues of costs, disbursements and expenses.

8    Taking into account that evidence, which includes the opinion of Senior Counsel as to the appropriateness of the proposed settlement, and acting upon my own assessment of the material, I am satisfied that the orders sought by the parties in this proceeding should be made under ss 33V and 33ZF of the Federal Court Act, and I now make those orders.

Associate:

Dated:    28 March 2013