FEDERAL COURT OF AUSTRALIA

CJMCG Pty Ltd as Trustee for the CJMCG Superannuation Fund v Boral Limited [2020] FCA 914

ORDERS

THE COURT ORDERS THAT:

1.    Orders 1 and 2 of the orders made on 23 July 2020 in NSD 340 of 2020 (Quinn Emanuel Proceeding) be vacated.

2.    The Quinn Emanuel Proceeding and proceeding NSD 602 of 2020 (Maurice Blackburn Proceeding) be case managed together.

3.    To the extent that any originating or interlocutory application is proposed to be filed by any party, the parties have leave to file, and are to file, serve and provide to the Associate to Justice Lee any such application by 6 July 2020.

4.    Should the parties become aware, on or before 10 July 2020, that a proceeding is proposed to be commenced by Phi Finney McDonald, the parties are to contact the Associate to Justice Lee as soon as practicable after becoming aware of such a proposal so that such proceeding can be made returnable at the case management hearing listed pursuant to order 5.

5.    The Quinn Emanuel Proceeding and Maurice Blackburn Proceeding be listed for case management hearing at 12noon on 10 July 2020.

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

REASONS FOR JUDGMENT

(Revised from Transcript)

LEE J:

1    This is a case management hearing in two class actions, being CJMCG Pty Ltd as Trustee for the CJMCG Superannuation Fund v Boral Limited (NSD 340 of 2020) (Quinn Emanuel proceeding); and Andrew Parkin v Boral Limited (NSD 602 of 2020) (Maurice Blackburn proceeding). In respect of the former class action, this is the second case management hearing; and in relation the latter, this is the first case management hearing.

2    The Quinn Emanuel proceeding was commenced on 19 March 2020 and was returnable for a first case management hearing on 23 April 2020. As the Central Practice Note: National Court Framework and Case Management (CPN-1) outlines (at [8.4]), the first case management hearing is integral to case management, with the aim of identifying issues at the earliest possible stage.

3    On 23 April 2020, I sought to explore with the parties the optimal way of progressing the Quinn Emanuel proceeding through its interlocutory stages to an early initial trial. Orders were made which, inter alia, required the respondent to file and serve its defence and for the applicant to file and serve any reply. Orders were also made concerning discovery, and that the proceeding be listed for case management as soon as practicable after 31 July 2020 on a date to be advised.

4    Things then changed.

5    On 28 May 2020, without prior notice to the Court, a substantially duplicative open class proceeding was commenced, being the Maurice Blackburn proceeding. It is apparent from what I have been told today, that at the time of the first case management hearing in the Quinn Emanuel proceeding, Maurice Blackburn were aware of the first case management hearing in that proceeding and that the Court, consistently with the procedure identified in the Class Actions Practice Note (GPN-CA) and CPN-1, would likely be making orders to progress the matter.

6    On 12 June 2020, I was provided with a proposed minute of consent orders in the Quinn Emanuel proceeding, seeking an order be made in chambers that the date for the filing of the defence be extended on the basis that the respondent be “forthwith excused from continuing its preparation of the defence” pending the outcome of the case management hearing today, which hearing I had fixed upon becoming aware of the filing of the Maurice Blackburn proceeding. I declined to make that order because I thought it was best to hear from the parties today.

7    On 18 June 2020, (that is, yesterday), my Associate was provided with proposed orders in relation to the conduct of each proceeding. Orders 1 and 2 of those proposed orders were in following terms:

1.    By 4pm on 19 June 2020, [Boral Limited] is to provide a copy of these orders to the law firm (sic) Phi Finney McDonald.

2.    By 4pm on 29 June 2020, Phi Finney McDonald are to notify the Associate to Justice Lee, with copies of the notification to be provided to the parties (as defined below) whether they have instructions to investigate or commence a representative proceeding against [Boral Limited], and if so the status of the proposed claim and the best estimate of the timeframe for filing the proceeding.

8    When these orders came to my attention late last evening, I instructed my Associate to contact the parties to suggest that contact be made immediately with the solicitors, Phi Finney McDonald. That was because the proposed orders were legally misconceived (in that they contemplated orders being made which would purport to bind persons who were not to be present and absent notice) and, perhaps more importantly, there was little point in proceeding to yet a further case management hearing when it was obvious that another firm of solicitors were apparently investigating the conduct of another class action, and any directions and orders to be made at this case management hearing should be informed by an understanding of the true extent of any likely multiplicity contest.

9    At very short notice, Mr Fahey of counsel was able to appear, for which I am grateful. He informed the Court that Phi Finney McDonald is currently investigating a class action which is well-progressed, with litigation funding terms being secured with a funder. Apparently, funding agreements have already been sent out to some proposed group members, and it is intended that the solicitors will seek to “book-build” in order to have a sufficient number of group members to meet requirements put in place by the funder for the commencement of a funded, open class proceeding. It appears that Phi Finney McDonald, like Maurice Blackburn, were aware that a case management hearing was taking place in the Quinn Emanuel proceeding on 23 April 2020.

10    These multiplicity disputes present challenges for the Court. They have delayed, sometimes substantially, the progress of matters both in this Court and in other courts. The time has long passed, if it ever existed, where firms of solicitors can sit back and stay schtum when a not unrealistic prospect exists that a substantially duplicative open class proceeding will be commenced. In the present circumstances, both experienced class action firms stayed mute when the matter was first before the Court. Such a course should not happen again – it amounts to conduct inimical to the resolution of the disputes between claimants and a respondent as quickly, inexpensively and efficiently as possible. Indeed, these events have necessitated the vacation of the substantive orders made on 23 April 2020, with the consequence that the underlying dispute remains in stasis while plaintiff lawyers and funders consider their respective positions.

11    Of course, it is perfectly understandable why a firm of solicitors would be reticent to commence an open class proceeding, notwithstanding another open class proceeding has already been, or may about to be, commenced. Apart from the fact that it may take time to secure funding, the commencement of a proceeding is a serious step. Leaving aside the fact that, as far as possible, a proposed applicant should take genuine steps to resolve disputes before civil proceedings are instituted (see Civil Dispute Resolution Act 2011 (Cth)), such a step can only be undertaken when those advising a proposed applicant have conscientiously fulfilled their obligation to satisfy themselves that there is a proper basis for making the allegations set out in the statement of claim. The relevant professional obligations of lawyers, and the encouragement of mature reflection and proper pleading of claims, has informed the view (expressed by judges on a number of occasions), that to approach carriage of open class proceedings in a way which encourages a race to the “courthouse steps” would be highly unfortunate and potentially deleterious to the administration of justice.

12    In ordinary circumstances, I would proceed to deal with this multiplicity dispute with celerity and with an intention to reduce the costs associated with such a process. But for a matter that I will mention shortly, this would involve either dealing with that dispute today at the case management hearing, or, alternatively, putting in place a very short timetable to allow discussions between the parties and then making a prompt decision as to the remedial response to be adopted.

13    The present difficulty is that it has been drawn to my attention that the High Court has granted special leave to appeal from the decision of the New South Wales Court of Appeal in Wigmans v AMP Ltd [2019] NSWCA 243; (2019) 373 ALR 323 (Bell P, Macfarlan, Meagher, Payne and White JJA). Senior counsel for the respondent in both the Quinn Emanuel and Maurice Blackburn proceedings, Mr Moore SC, has informed me that the argument proposed to be advanced by the appellants on appeal in Wigmans is, with perhaps some oversimplification, that Pt 10 of the Civil Procedure Act 2005 (NSW), which is the relevant cognate of Pt IVA of the Federal Court of Australia Act 1976 (Cth) (Act), operates to the exclusion of other powers in dealing with multiplicity disputes. It is said that Pt 10 does not authorise the approach taken by Ward CJ in Eq (the primary judge whose decision was affirmed on appeal in Wigmans), as to the determination of the stay applications the subject of those proceedings.

14    Upon first reading of the notice of appeal filed in the High Court in Wigmans which was provided to me, it appeared that the matters likely to be canvassed on the appeal may be particular to the statutory provisions to be examined. It was not immediately obvious to me that the proposed appeal would likely canvass, for example, the issue of whether this Court, as a court of equity, has power to enjoin the conduct or commencement of substantially duplicative open class proceedings on the basis that it would be contrary to good conscience to continue such proceedings, in circumstances where it would oppressively interfere with the due processes of the proper conduct of the matter: see Perera v GetSwift Ltd [2018] FCA 732; (2018) 263 FCR 1 (at 46–8 [159]–[165] and 84–5 [350] per Lee J).

15    However, now that I have been informed by Mr Moore SC as to the scope of the appellant’s argument, there may be some merit in deferring consideration of how to deal with the multiplicity issues in this matter until the High Court has delivered judgment in Wigmans.

16    In fashioning a solution to multiplicity, my present intention would be allow only one open class action to proceed; although this end could be achieved by a number of means. In this regard, I note that during the hearing of the special leave application, senior counsel for the appellants submitted that the course adopted by the Full Court in Perera v GetSwift Ltd [2018] FCAFC 202; (2018) 263 FCR 92 (Middleton, Murphy and Beach JJ), and by the New South Wales Court of Appeal in Wigmans, was said to have been pioneered at first instance in GetSwift and “has as its fundamental premise that multiple, duplicative class actions are a good thing. They are in no way to be discouraged, contrary, we would say, to the law’s ordinary strong aversion to multiplicity of action”: see Wigmans v AMP Limited [2020] HCATrans 52. Lest there be any doubt, my view is that the law does have a strong aversion to multiplicity of duplicative proceedings, including open class actions. Although, by virtue of both s 33C of the Act (which allows class actions to be commenced on behalf of some potential claimants) and the opt-out mechanism, Pt IVA does contemplate the prospect of some multiplicity of proceedings. Indeed, the reason why I was initially keen to resolve the issue of multiplicity today, is that I am firmly of the view that ordinarily it is contrary to the overarching purpose of civil litigation (see Part VB of the Act) and the administration of justice generally, for there to be substantially duplicative open class proceedings.

17    For these reasons, I propose to make orders vacating Orders 1 and 2 made on 23 April 2020 and further order that the Quinn Emanuel proceeding and the Maurice Blackburn proceeding be case managed together. I will further order that Phi Finney McDonald and the present parties are to contact my Associate should they become aware that Phi Finney McDonald is to commence a proceeding, so that any such proceeding can be made returnable at the same time as the extant proceedings.

18    This leaves the question of what, if anything, should now be done in relation to the issue of multiplicity. Mr Edwards, who appears on behalf of the applicant in the Maurice Blackburn proceeding, notes that the intention of his client is to consider relief that may include an application pursuant to s 33T of the Act to substitute Mr Parkin, the applicant in the Maurice Blackburn proceeding, as the applicant in the Quinn Emanuel proceeding. There may also be other relief that his client seeks.

19    As I have already indicated, I was (and am) attracted to resolving these issues with alacrity if it is possible to do so. Accordingly, I will direct that the parties file any interlocutory application, or any originating application in the same “matter” (to use that word in its Constitutional sense), which applications will be returnable before me on 10 July 2020. At that time, I will make a determination as to whether it is appropriate to deal with any multiplicity issues or whether I should take the course (urged upon me by the applicant in the Quinn Emanuel proceeding and by the respondents), to defer further consideration of multiplicity issues until after the High Court has dealt with the appeal in Wigmans.

Associate:

Dated:    29 June 2020