FEDERAL COURT OF AUSTRALIA

Street v State of Western Australia [2024] FCA 1368

REASONS FOR JUDGMENT

MURPHY J:

1.    Introduction

1    This representative proceeding, colloquially known as the as the “Western Australia Stolen Wages Class Action”, is a significant matter in relation to a historic grievance between the First Nations peoples of Western Australia and the respondent, the State of Western Australia. The proceeding seeks damages for the widespread non-payment and underpayment of wages to Aboriginal and Torres Strait Islander people who worked in Western Australia between 11 December 1936 and 9 June 1972. There is no dispute that over that 36-year period thousands of Aboriginal men, women and children in Western Australia lived under strict legislative controls and many worked for little or no pay. For example, many Aboriginal men and boys worked on pastoral stations as ringers, or stockmen, sometimes from dawn till dusk seven days a week, and many Aboriginal women and girls worked as household domestics and nannies. They were fed or given rations, but provided little or no wages for the work they performed. During that period, many Aboriginal children who had been taken away from their parents and placed in institutions run by the State or by a church, were required to work before and after school and on weekends, and in some cases full-time, in laundries, farms and other places attached to the institutions. Those Aboriginal people were treated in a grossly discriminatory fashion compared to non-Indigenous people.

2    The applicant, Mr Mervyn Street, is a senior elder of the Gooniyandi People and an acclaimed artist, born circa 1940. The proceeding alleges that he worked on pastoral stations in the Kimberley from when he was around 10 years old, starting on the Louisa Downs station which is his traditional country, and was not paid wages until he was in his 30s. Mr Street brings the case against the State, as a class action under Part IVA of the Federal Court of Australia Act 1976 (Cth) (FCA Act) and also an “old-style” representative proceeding under Division 9.2 of the Federal Court Rules 2011 (Cth) (Rules), doing so on his own behalf and on behalf of all Aboriginal persons who during all or part of the period between 1936 and 1972 (claim period) worked in Western Australia under the operation of the Native Administration Act 1905-1936 (WA), the Native Welfare Act 1905-1954 (WA), or the Native Welfare Act 1963 (WA) and Aboriginal persons who claim as their descendants (class members).

3    These reasons concern an application for Court approval of a proposed settlement of the class action, and are centrally addressed to explaining why the Court is satisfied that it is appropriate to approve the proposed settlement as fair and reasonable in the interests of the class members, and as between the class members. They concern a matter of public importance and are necessarily lengthy. For those who do not wish to wade through the reasons in their entirety, I provide the following summary.

1.1    Summary

4    On 17 October 2023, the parties entered into a settlement of the proceeding, subject to Court approval (proposed settlement). The proposed settlement is contained in a Deed of Settlement (Settlement Deed), with an annexed Settlement Distribution Scheme (SDS or Scheme), which Scheme has since been revised. Under the Settlement Deed the State promises to pay up to $180.4 million (Settlement Sum), comprised of:

(a)    an amount of up to $165 million (Settlement Fund Amount) in compensation; and

(b)    an amount of up to $15.4 million (Agreed Costs Component) in respect to the applicant’s party/party costs of the proceeding up to the date of settlement approval.

5    The proposed settlement includes a public apology by the State. On 28 November 2023 the Legislative Assembly of the Parliament of Western Australian passed the following motion:

That this house formally acknowledges and apologises to Aboriginal and Torres Strait Islander people who worked in Western Australia between 1936 to 1972 for little or no wages.

6    The Premier of Western Australia moved and spoke in support of the motion, and expressed the following apology:

Today’s apology follows the settlement of a class action led by Mr Mervyn Street on behalf of Aboriginal people across Western Australia. The class action started in 2020 and sought justice for people who, over a long period of time, were subject to discriminatory legislation. This legislation was supposed to protect Aboriginal people, but instead resulted in hardship and exploitation. The controls imposed on Aboriginal people impacted on where they were allowed to work, travel and live. It also impacted on how much money they were paid, how they were paid and how they received their wages and entitlements. Legislation of this kind, particularly in the early part of WA’s colonial history, resulted in Aboriginal people working long hours without receiving any pay or an appropriate amount of pay. Instead, they were often paid through rations such as flour, sugar, tea, and tobacco. The “book down” system, in which people bought necessities on credit at the station store, also meant that some people never saw the money they were meant to be paid. Although the laws changed over the period, many controls remained in place until 1972.

Aboriginal men, women and children worked hard and made enormous contributions to the economic development of this state. However, they received only a fraction of their worth. The fact that this mistreatment existed for Aboriginal workers for decades is a blight on the legacy of successive governments. The fact that our laws facilitated these outcomes brings great shame. For that, we are sorry. These workers - men, women and children - worked under oppressive conditions. In many cases, there was a threat of violence. The impacts of these laws were felt across the state in a range of different work settings. The issues in this matter were complex. I acknowledge that each individual Aboriginal person’s work history will have been unique. However, as a community, many of these experiences were common. During the hearings in the class action proceedings, stories were told of Aboriginal people living and working in harsh conditions. We heard about men working 14-hour days as stockmen and musterers on pastoral stations; women working as domestics, cooking, cleaning and caring for children in homes all over Western Australia; and, on missions, young people working long hours before and after school, including in laundries or on farms attached to the institution.

…

In bringing a close to this shameful part of Western Australia’s history, on behalf of the State of Western Australia, I apologise to the Aboriginal men, women and children who worked in Western Australia between 1936 and 1972, often for decades, for no pay or not enough pay. We acknowledge that many of these people have not lived to see this day. For their family members who remain, we are sorry for the hurt and loss that your loved ones suffered. Their strong shoulders carried the weight of their families and communities. Their strong hands build up this state’s economy. Their strong minds and spirits pursued justice in the decades that followed, leading to this moment and the recognition they rightfully deserved.

To you all, we say sorry.

7    The proposed settlement is structured such that the quantum of the Settlement Fund Amount depends upon the number of participating class members (defined as “Original Eligible Claimants”):

(a)    an Original Eligible Claimant (OEC) is:

(i)    a class member who registered during the Court-ordered class member registration process (Registration Process);

(ii)    who is alive, or if deceased there exists at least one “Descendant Eligible Claimant” who is eligible for a payment under the SDS; and

(iii)    who the Court-appointed Administrator of the SDS is independently reasonably satisfied meets the criteria for eligibility under the Scheme on the basis of credible and cogent evidence (with minimum evidence as specified), including as to identification as an Aboriginal or Torres Strait Islander, having a date of birth before 9 June 1962, provision of a statement that the person was employed by at least one nominated workplace in Western Australia which existed at the relevant time and were paid no or nominal wages during the claim period, and the provision of information allowing payment of an entitlement under the Scheme to be made;

(b)    a Descendant Eligible Claimant (DEC) is:

(i)    a class member who is the living spouse or child of a deceased OEC who registered during the Registration Process; and

(ii)    who the Administrator is reasonably satisfied meets the criteria for eligibility under the SDS.

8    Orders were made on 14 and 20 November 2023 providing for class members to be given notice of the proposed settlement, and for the conduct of a substantial physical outreach program to Aboriginal communities throughout Western Australia, including in remote locations, so that class members were informed of the requirement to register if they wished to be eligible for a payment under the SDS, and to assist them to register.

9    The Registration Process was reasonably effective. Although the number of OECs is presently unknown, and the final decision as to eligibility rests with the Administrator under the SDS, the solicitors for the parties have engaged in a process to preliminarily assess the registrations received to date. The parties agree that there are likely to be circa 8,000 to 9,500 OECs once all eligible registrations have been determined by the Administrator (including all late registrations). In my view it is appropriate to assess the fairness of the proposed settlement by reference to the middle of that range, being 8,750 OECs.

10    On the assumption that there are 8,750 OECs, the Settlement Sum will be $159.775 million, comprising the following payments:

(a)    the Settlement Fund Amount of $144.375 million (representing 8,750 OECs multiplied by $16,500 per OEC), to be paid by the State in tranches as the Administrator accepts the eligibility of OECs; and

(b)    the Agreed Costs Component (ACC) of $15.4 million, to be paid by the State upon expiry of the time for appeal from the settlement approval orders.

11    It is important to understand that the proceeding does not relate to the discriminatory and cruel way Aboriginal people were often treated during this appalling period of our history; it is concerned with the fact that many were not paid either properly or at all for their work. In the course of the proceeding the Court heard evidence from many Aboriginal people who were taken away from their families at a young age, placed into an institution run by the State or a church, where they were then required to work for no pay. Many of the children suffered inestimable grief and trauma by being forcibly removed from their families, and many were cruelly treated within the institutions and discriminated against. Many suffered lifelong psychological scars as a result. As is often the case with people, some managed to rise through the discrimination and trauma they were forced to endure and went on to have reasonably happy and productive lives. Others, through no fault of their own, were brought down by the way they were treated and their lives were blighted by it. The stories that I heard will stay with me forever, and I am deeply sorry that First Nations people were so disgracefully treated. The proposed settlement does not attempt to compensate Aboriginal people for the shameful way they were treated.

12    It is also important to understand that the applicant does not suggest that the proposed settlement represents full compensation for the unpaid or poorly paid work Aboriginal people performed over the 36-year claim period. The Court has reviewed the confidential opinions of expert forensic accountants and economists which attempt to estimate the aggregate wage loss suffered by the great many Aboriginal people who were not properly paid during that period. They offer quite different estimates of the aggregate wage loss likely to have been suffered, which to an extent arises because of the counterfactual behind the opinion of the State’s expert. Whatever expert estimate is used, it is plain that the proposed settlement represents a very substantial discount on full compensation plus interest.

13    Essentially, the applicant and his lawyers recommend the proposed settlement to the Court as the best result possible given the substantial legal hurdles facing the case, and the substantial risks that the claim brought by the applicant and class members will fail, or will succeed on claims which do not relate to all class members or in relation to which the quantum is relatively low compared to the proposed settlement.

14    The following matters are salient to my conclusion that it is appropriate to grant approval of the proposed settlement as fair and reasonable in the interests of class members who will be bound by it, including as between class members.

15    First, the Court has the benefit of comprehensive confidential opinions from senior and junior counsel for the applicant, W.A.D. Edwards KC, J. Creamer, A.H. Edwards and J.A. Brezniak (Counsels’ Opinion), which candidly considers the fairness and reasonableness of the proposed settlement in the interests of class members as a whole considered inter partes, and its fairness and reasonableness inter se, that is, as between class members. Counsel provided their opinions as officers of the Court rather than as advocates for the applicant and class members. Counsel assessed the principal risks and difficulties for the applicant and class members in the proceeding, including by making a risk-weighted assessment in light of the cumulative risks which the proceeding faces. Counsel also gave careful attention to the fairness and reasonableness of the proposed SDS as between class members. Counsel recommended that the Court approve the proposed settlement. It is appropriate to give significant weight to Counsels’ opinion.

16    Second, many of the claims in the proceeding are novel and difficult, and they carry risks in relation to liability, causation and quantum. Amongst other things, given that most of the claims arise in respect of conduct between 1936 and 1972, they face a significant risk of being barred by the application of various limitation periods upon which the State relies. Further, the class member’s claims are idiosyncratic being based in their individual employment circumstances, and there are likely to be substantial forensic difficulties for many class members in proving factual matters that are alleged to have occurred between 52 and 88 years ago, particularly where the OEC is deceased (as most are) and where most of the institutions and private employers for whom they worked are no longer operating. Many class members’ claims face a significant risk of failing because they cannot prove the factual matters on which their claims depend. The risks and difficulties associated with the claims are cumulative in the sense that one risk follows after another, to the point that it is impossible for the applicant’s lawyers to be confident of success in the proceeding. I am satisfied that there is a significant risk that if the case proceeds to trial the applicant’s and class members’ claims will fail, or they will succeed on claims which relate to only a subset of the class members and for a quantum less than the proposed settlement.

17    In a case with the substantial risks and difficulties of this proceeding, notwithstanding that it is nowhere near full compensation, a settlement of up to $180.4 million combined with a public apology is comfortably within the range of reasonable outcomes.

18    Third, the complex and difficult legal issues involved in the proceeding means that if the applicant is successful on the common issues in the initial trial there is likely to be an appeal. Any appeal will inevitably lead to further significant delay. Assuming the appeal process results in findings favourable to the class members, there will be further delay while the parties either attempt to negotiate a groupwide settlement, or a series of individual settlements with the prospect of further mini-trials in relation to any claims that are not compromised. Given the idiosyncratic nature of the class members’ claims, this not a case where it can be said that favourable liability findings will necessarily lead to substantial damages awards in favour of all class members.

19    The great majority of living class members are elderly, and many have passed away since the proceeding was commenced. It is likely that more class members will pass away during the pendency of any attempt to negotiate a groupwide settlement or a series of individual settlements. The advanced age of many class members, and the importance of them receiving compensation in their lifetime is material to my view that it is appropriate to approve the proposed settlement.

20    Fourth, the SDS provides for a fair division of the proceeds of the proposed settlement between eligible class members pursuant to uniform principles and procedures, the administration process does not involve “judgment calls” except perhaps in relation to the assessment of what constitutes “cogent and credible” evidence of eligibility, the Scheme provides a meaningful opportunity for review, and if it proceeds as planned the settlement administration process will not involve unreasonable costs or delay.

21    Fifth, there were 46 objections by class members to the approval of the proposed settlement, most of which were centrally directed to the inadequacy of the settlement amount compared to the aggregate wage loss that class members suffered, and to the contention that the settlement amount does not recognise the harsh or cruel treatment class members suffered. Many of the objections were powerfully made and I was touched by the anguish and hurt some objectors expressed about the discriminatory and unjust way they and their parents were treated, and the lasting legacy of economic and social hardship which arose from that. Their objections reflect the historical wrongs to which the proposed settlement relates, and act as a reminder of the importance of acknowledging the occurrence of those wrongs. I gave careful attention to the objections but, in the circumstances of the case, they do not justify refusing to approve the proposed settlement.

22    Sixth, there is a question as to whether the legal costs (including disbursements) proposed to be charged by the applicant’s lawyers, Shine Lawyers (Shine), are fair and reasonable and therefore appropriate to be deducted from the proposed settlement. Ultimately, Shine sought approval for legal costs in a total of $29,249,479, plus further monies for transition to the Scheme Administrator. This sum represented a discount, applied by Shine ahead of the settlement approval hearing, from the amount of $31,501,618 recommended as fair and reasonable by the independent Court-appointed Costs Referee, Ms Kerrie Rosati.

23    Even with Shine’s proposed discount that is a huge amount, which I consider to be excessive. I am persuaded that it is appropriate to adopt most of the independent Costs Referee’s reports, but I do not accept the conclusion that the fair and reasonable costs of the proceeding total $31.5 million, nor those parts of the reports which recommend approval of the amounts Shine charged for paralegals and law clerks. I consider it appropriate to approve Shine’s fees with a reduction of $4 million from the amount approved by the Costs Referee, bringing total costs and disbursements down to approximately $27.5 million. That remains a huge sum, but a $4 million reduction in Shine's costs from those approved by the independent Costs Referee is substantial, even for a large publicly listed firm like Shine.

24    At least in part, the excessive costs are attributable to excessive legal fees incurred post-settlement. Before the Costs Referee’s reports and before it proposed a discount to its fees, Shine had run up approximately $12 million in fees (not disbursements) including uplift charges for the work it undertook in the post-settlement Registration Process. After the Costs Referee’s reduction those fees came to approximately $11 million and after the discount Shine belatedly proposed those fees came to approximately $8.8 million. The Court should be cautious before approving costs of that magnitude for a post settlement registration process. Because of the characteristics of the cohort of class members the Registration Process had particular difficulties, and Shine performed the work to a high standard, but before it ran up such enormous costs post-settlement Shine should have come before the Court and given notice of that proposed expense.

25    Had the Court been approached I expect that a significantly less expensive solution could have been found. For example, it might have been appropriate to engage local Indigenous representatives on weekly or monthly contracts rather than hourly rates; or to engage a claims administration service. It might have been appropriate to take a less “Rolls Royce” approach. Shine needed to give greater attention to whether there were cheaper or more efficient ways of achieving a similar outcome, and to keep a much tighter grip than it did on the costs associated with the Registration Process.

26    Seventh, there is a question as to whether the funding commission sought by the litigation funder which funded the proceeding, LLS Fund Services Pty Ltd (the Funder), is fair and reasonable and therefore appropriate to be deducted from Settlement Sum. The Funder seeks reimbursement of the money it has paid out, being:

(a)    $1,045,000 in premiums for after the event insurance (ATE Costs); and

(b)    $13,358,868 it has paid to Shine for conducting the proceeding.

Then, for its return on investment in the case the Funder seeks a common fund order of 20% of the gross settlement.

27    Assuming that there are 8,750 OECs, the gross settlement will be $159.775 million (8,750 OECs x $16,500 plus $15.4 million for the ACC). A common fund order of 20% of the gross settlement would therefore mean a funding commission of approximately $31.955 million.

28    I am not persuaded that a funding commission of just under $32 million is fair and reasonable in the circumstances of the case. I consider that a funding commission of 16% of the Settlement Sum is “just” pursuant to s 33V(2) of the FCA Act. Assuming there are 8,750 OECs, the commission will total $25,564,000. That amount plus reimbursement of $14.403 million in Project Costs it has paid ($13.358 million in legal costs and $1.045 million for ATE Costs). It represents a commercially realistic return and properly reflects the costs and risks taken on by the Funder. It represents a return on investment (ROI) of 2.77 times the Funder’s expenditure.

29    Intuitively, 16% seems too low, which gave me cause for some reflection. But it provides a reasonable ROI given the quantum of the settlement and the unusual operation of the funding arrangements which materially reduce the costs and risks the Funder took on. The Funder ceased to fund the case about a year before trial (upon reaching the funding cap); thus it did not fund the case to the mediation at which the settlement was reached, and it did not fund the case for trial even though the proposed settlement was reached only five days before trial. By October 2023 when the proposed settlement was reached, the total legal costs of the proceeding were approximately $18.2 million, and the Funder had paid less than $10 million of that total. If its ATE Costs are included the Funder had paid approximately $11 million prior to the proposed settlement being reached. Overall Shine “funded” the case nearly 50-50 with the Funder, and yet the Funder seeks recovery of a funding commission as if it funded the whole case.

30    It is also necessary to understand that the requirement for Shine (rather than the Funder) to resource the case to the extent that it did imposed a significant further cost burden on class members through Shine’s 25% uplift fees. By the end of the case (using the Costs Referee’s assessment of reasonable costs of $31.5 million) Shine had charged approximately $2.69 million in uplift fees. Such fees would have been much less had the Funder fully funded the proceeding.

31    Eighth, the applicant submitted that Mr Street should be paid a $45,000 reimbursement payment to reflect the work he undertook as the representative applicant. I accept that Mr Street worked hard and effectively in his role as the representative applicant, but was troubled as to the amount of that payment given the modest size of the payments to be made per OEC. However, following receipt of further submissions I became persuaded that it is fair and reasonable to allow Mr Street a reimbursement payment of $45,000, and to allow a reimbursement payment of $5,000 for each of the seven sample group members.

32    The Court expresses its gratitude to the parties and their lawyers for the way in which they conducted the case. The parties’ lawyers provided excellent representation throughout the case, and they maintained a professional approach to each other which made case management more straightforward, particularly during the logistical challenges and interruptions in the preservation of evidence hearings in relatively remote locations. More importantly, the Court thanks the parties and their lawyers for achieving a settlement including a public apology in relation to these historic and grievous wrongs. The Court hopes the settlement will assist Aboriginal and Torres Strait Islander communities to move forward from the trauma they suffered.

33    I now turn to consider the proposed settlement in detail. I thank the parties for their detailed submissions, upon which I have directly drawn at various points.

2.    The evidence

34    The applicant relied upon affidavits of:

(a)    Ms Vicki Antzoulatos, a solicitor employed by Shine with the conduct of the proceeding for the applicant, filed 8 October 2024 (First Antzoulatos Affidavit), 22 October 2024 (Second Antzoulatos Affidavit), 25 October 2024 (Third Antzoulatos Affidavit), 28 October 2024 (Fourth Antzoulatos Affidavit), 29 October 2024 (Fifth Antzoulatos Affidavit) and 29 October 2024 (Sixth Antzoulatos Affidavit); and

(b)    Ms Sarah Thomson, a solicitor employed by Shine, filed 13 November 2024.

The applicant filed written submissions dated 8 October 2024, supplementary submissions dated 25 October 2024, and further written submissions on 7 November 2024.

35    The State relied upon affidavits of Mr Daniel Gorman, a solicitor employed in the State Solicitor’s Office with the conduct of the proceeding for the State, filed 14 June 2024 (First Gorman Affidavit), 22 October 2024 (Second Gorman Affidavit) and 25 October 2024 (Third Gorman Affidavit). The State filed written submissions dated 22 October 2024, and further written submissions dated 27 October 2024.

36    The Funder relied upon affidavits of Mr Stephen Conrad, an executive officer of the Funder, filed 10 October 2024 (First Conrad Affidavit) and 24 October 2024 (Second Conrad Affidavit), and the First Antzoulatos Affidavit. The Funder filed written submissions dated 10 October 2024, submissions in reply dated 24 October 2024, and further submissions on 1 November 2024.

37    Shine was given leave to intervene. It filed written submissions dated 22 October 2024.

3.    The class

38    The class members to whom this proceeding relates are persons who:

(a)    are Aboriginal or Torres Strait Islander persons who lived in Western Australia during all or part of the period from 11 December 1936 to 9 June 1972;

(b)    during all or part of the claim period were a “native” as defined by:

(i)    s 2 of the Native Administration Act 1905-1936 (WA) (as amended from time to time in the claim period) (the 1936 Act), including by the Native Welfare Act 1905-1954 (WA) (the 1954 Act); and/or

(ii)    s 4 of the Native Welfare Act 1963 (WA) (as amended) (the 1963 Act); and

(c)    during all or part of the claim period worked in Western Australia at a time when they were a “Controlled Native” or had their property controlled under the 1936 Act, the 1954 Act or the 1963 Act (collectively, the Control Acts),

all persons meeting sub-paragraphs (a) to (c) being a Working Controlled Aboriginal, and if a Working Controlled Aboriginal has died (Deceased Working Controlled Aboriginal), then any legal personal representative or beneficiary of the estate of the Deceased Working Controlled Aboriginal who has the capacity to claim on behalf of that estate. Any person who has a right (equitable or otherwise) in respect of the administration of, or property forming part of, the estate of the Deceased Working Controlled Aboriginal is also a class member.

3.1    The Class Member Registration Process

39    The proceeding was commenced as an “open class” class action in October 2020.

40    Prior to filing the proceeding Shine attempted to have class members register their interest in participating in the case, and it continued its efforts to have class members register throughout the course of the case.

41    Pursuant to orders made on 26 May 2021, the Court approved the form and content of an opt out notice, an information brochure, an advertisement and an announcement to be broadcast on radio. Shine engaged experts, including Aboriginal experts, to assist in drafting the information to be provided to class members so as to maximise the prospect that it would be understandable and effective for a cohort of Aboriginal class members which is highly vulnerable, with a high degree of socio-economic disadvantage, low levels of literacy and numeracy, in which many class members are of advancing years and living in remote locations.

42    Pursuant to those orders Shine conducted a physical outreach program by attending 62 communities in Western Australia to communicate with class members in relation to the proceeding and the opt out process. As part of that program, Shine also sought to identify sample group members to put forward their specific claims. A substantial number of class members registered to participate in the class action in the course of that outreach program.

43    On 17 October 2023, the parties reached the proposed settlement. On 2 November 2023, the applicant filed an interlocutory application seeking Court approval of the proposed settlement, and interlocutory orders including orders for:

(a)    class member registration and class closure, to the effect that only class members who register and are found by the Administrator to be eligible will be entitled to share in the proposed settlement, and that class members who do not register will be bound by the settlement but will not be permitted to seek any benefit under the settlement, without leave of the Court; and

(b)    a Notice of Proposed Settlement (Settlement Notice) and an information brochure to be provided to class members to inform them of the proposed settlement, of the requirement to register in order to participate in the proposed settlement, and of their right to object to the proposed settlement.

44    The Settlement Deed provided that a registration process was a requirement of the proposed settlement. Indeed, the Settlement Fund Amount is calculated by reference to the number of registered OECs multiplied by $16,500 per OEC, capped at $165 million. The Settlement Deed requires that a class member be registered and be found to be eligible by the Administrator (and thus an OEC) before the State is required to make a payment of $16,500 in respect of that OEC. Absent a registration process there would be no Settlement Fund Amount. Further:

(a)    the registration form to be utilised would collect all the information the State requires before making a $16,500 payment relating to that OEC. That removed the need for two notice procedures, one to give notice of the proposed settlement and one for settlement distribution. Two separate notice procedures was likely to cause substantial delay and extra cost, in large part because of the necessity to use physical outreach programs to reach the class, and also had the potential to confuse class members; and

(b)    the vast majority of living OECs are elderly, having worked between 1936 and 1972, and it was important to streamline processes to allow faster distribution of settlement amounts.

45    In the circumstances the Court concluded that a class member registration process was appropriate.

46    Shine again engaged experts, including Aboriginal experts, this time to assist in drafting the Settlement Notice and information brochure to be provided to class members so as to maximise the prospect that it would be understandable and effective for a cohort of class members with the particular characteristics of this class. The Court approved the Settlement Notice and information brochure in the terms proposed.

47    On 14 November 2023 the Court made orders requiring the publication of the Settlement Notice and information brochure:

(a)    to the communities and towns listed in the orders;

(b)    via a physical outreach program described in the orders;

(c)    on a page of the Shine website titled “Western Australia Stolen Wages Class Action”;

(d)    on the Federal Court website;

(e)    to the next of kin deceased persons on the customer list for the “2012 Reparations Scheme”; and

(f)    in such other manner the applicant considered best calculated to bring them to the attention of class members.

The orders also required publication of advertisements regarding the proposed settlement in newspapers and by radio.

48    In compliance with the 14 November 2023 orders:

(a)    advertisements of the proposed settlement were published in 18 newspapers in Western Australia;

(b)    radio announcements in relation to the proposed settlement were broadcast on 31 radio stations operating in Western Australia;

(c)    the Settlement Notice and information brochure were published on Shine’s website, and also on the Federal Court website and made available for inspection at each Federal Court registry;

(d)    the Settlement Notice and information brochure were sent by post to all persons not identified as deceased who were on the “customer list” for the State 2012 Reparations Scheme that was established in relation to stolen wages in Western Australia, and for whom the State held postal information;

(e)    the Settlement Notice and information brochure were sent by email to all persons and Aboriginal organisations to whom an opt out notice was provided, and to those individuals and Aboriginal organisations who provided email addresses in connection with the State 2012 Reparations Scheme; and

(f)    the Settlement Notice and information brochure were communicated along with updates via direct electronic and postal mailouts on 16 different occasions between 30 November 2023 and 19 September 2024.

49    Given the characteristics of the cohort of class members the physical outreach program to Aboriginal communities was central to informing class members of the proposed settlement, of the need to register to participate in the proposed settlement, and of their right to object to the proposed settlement if they wished. Between 19 November 2023 and 15 June 2024, the Shine team of lawyers, law clerks and paralegals visited 104 locations across Western Australia. At each town or community visited as part of the outreach program, Shine hosted an information session, generally lasting for 2-3 hours, and after each session, the Shine team would provide copies of the Settlement Notice and registration forms to key stakeholders in the community or town and to people who were not able to attend. Shine also:

(a)    held 21 additional information and registration sessions upon invitation to provide information to class members who were unable to travel to an ordinary information session;

(b)    distributed the settlement material to any community members who requested copies for family members and to key community facilities;

(c)    attended residences or other community locations to take registrations from class members who did not or could not attend the larger sessions;

(d)    conducted further registration and information sessions via video link; and

(e)    where Shine was unable to visit a location in person due to the remoteness of that community, the applicant took steps to contact communities to arrange assistance to community members, for example, by providing a video link between the Community Office and Shine.

50    On 17 June 2024 the Court made orders to extend the registration date and to require the republication of the Settlement Notice and information brochure. I made these orders following a case management hearing where Shine put on evidence to the effect that many class members would miss out on the opportunity to register if the original registration deadline was maintained. The evidence was to the effect that the rate at which registration forms were being received indicated that class members were continuing to learn about the proceedings.

51    Pursuant to the orders made 17 June 2024 the Shine team travelled back to Western Australia in August and September 2024 and conducted further information sessions in a further seven locations upon invitation to AGMs of various Aboriginal land councils, and large communities where Shine was informed by stakeholders that there was still a number of class members who had not completed a registration form and required assistance.

52    140 of the locations listed in the orders made 14 November 2023 were not visited as part of the outreach program. In respect of 102 of those places, Shine considered the populations were so small and so remote that the cost and time of scheduling an in-person visit was disproportionate to the likely level of class member engagement. In respect of the remaining communities, populations often were able to attend information sessions held nearby. Flooding prevented an information session in one community, but Shine provided registration details to a key contact there.

53    Up to 30 September 2024, Shine received 15,178 registration forms on behalf of class members who had registered electronically, on the phone with Shine team members, in person at an outreach information session, or using a hardcopy registration form.

3.2    Class closure

54    On 20 November 2023 the Court made orders for class member registration and class closure. The orders provide:

1.    Pursuant to s 33ZF of the Federal Court of Australia Act 1976 (Cth) (the Act), any Group Member who does not register under the Registration Process:

(a)    will remain a group member for all purposes of this proceeding; and

(b)    shall not without leave of the Court be permitted to seek any benefit under the proposed settlement, if the settlement is approved by the Court (otherwise than in accordance with clauses 23 to 26 of the proposed Settlement Distribution Scheme).

2.    For the purposes of order 1, a group member will be taken to have registered under the Registration Process if they submit an Application for Registration Form or an amended or supplemented Application for Registration Form by the Registration Date that is in accordance with clauses 8 and 9 of the Settlement Distribution Scheme. A failure to provide the additional information sought in the Application for Registration Form that is not referred to in clause 9 of the Settlement Distribution Scheme does not mean the person so lodging an Application for Registration Form is not registered under the Registration Process.

…

Clause 22 to 26 of the proposed SDS relates to late registrations. The balance of the relevant orders included a process for Shine to endeavour to rectify deficiencies in the registration forms provided to it, and to report to the Court in that regard.

55    The effect of the class closure orders, coupled with the release in the Settlement Deed, means that class members who neither opted out nor registered by the extended registration deadline continue to be class members; are therefore bound by the release in the Settlement Deed, but precluded by the orders from sharing in the compensation achieved through the proposed settlement.

3.3    Deficient registrations

56    By the orders made 20 November 2023 Shine was directed to attempt to contact and rectify registration forms for people who lodged an incomplete form, and for Shine to report to the Court identifying applications that were received that did not meet the requirements of the Registration Process (Deficient Registrations), before the settlement approval hearing.

57    In the Third Antzoulatos Affidavit Ms Antzoulatos deposed as to the number of Deficient Registrations and Shine’s rectification efforts. She said that, following amendments to the SDS agreed on 4 October 2024 which sought to reduce barriers to registration, many Deficient Registrations have been rectified and more will be rectified.

58    She deposed that, as at 30 September 2024, Shine had assessed 4,176 Registrations as Deficient Registrations for not meeting the minimum requirements prescribed by clause 8 and/or 9 of the SDS. Following amendments to the SDS and relaxation of the eligibility criteria the Shine team had reviewed 3,619 (87%) of these Deficient Registrations, and have rectified 1,009 (24%) of the total. She provided the following reasons for the Deficient Registrations:

(a)    366 required a signature;

(b)    1,743 did not provided current identification; and

(c)    1,030 failed to meet one or more (or a combination of) the other eligibility criteria.

59    In Ms Antzoulatos’ view, where only the signature or identification requirements are not met, a large portion will ultimately be assessed as eligible registrations. This is because the 1,009 Deficient Registrations that have already been rectified were of that type, and the only reason that more were not rectified already is that Shine ran out of time to contact all the relevant class members prior to the settlement approval hearing. In her view, with more time, rectification numbers should increase.

60    This leaves a not-insignificant group of 1,030 where the rectification work will be more difficult, for example because there is a possibility that class members who did not record a date of birth or a name of an Original Potential Claimant did not do so because they are precluded from doing so by lack of records, or perhaps by cultural factors which prevent the sharing of certain information.

61    Shine has made commendable efforts, at huge expense, to have class members register, and the process cannot go on forever. Under the SDS the Administrator is required to make efforts to rectify Deficient Registrations, and the Court expects that the Administrator will take a practical approach to the requirement for credible and cogent evidence to satisfy the eligibility criteria, and take into account to the particular vulnerabilities and characteristics of the cohort of class members.

3.4    Late registrations

62    Because of the characteristics of the cohort of class members it is appropriate to take a flexible approach to compliance with the registration deadline. On the eve of the settlement approval hearing on 28 October 2024 Ms Antzoulatos deposed that 350 registrations had been received between the extended registration deadline of 30 September 2024 and the settlement approval hearing. The settlement approval orders provide for those late registrants who are found to be eligible to be included in the settlement distribution.

3.5    The number of registrants

63    In the First Antzoulatos Affidavit Ms Antzoulatos deposed that Shine received 15,178 registration forms from potential claimants between 14 November 2023 and 30 September 2024. She broke those registrations down into the following categories:

(a)    2,576 registration forms received on behalf of Original Potential Claimants;

(b)    11,241 registration forms received on behalf of Descendant Potential Claimants;

(c)    1,067 duplicate registration forms;

(d)    41 registration forms that have since been withdrawn;

(e)    22 registration forms that have not indicated whether they are lodging a living claim or descendant claim; and

(f)    231 registration forms that are incomplete or received from Papua New Guinea.

64    In the Third Antzoulatos Affidavit, Ms Antzoulatos states that after de-duplicating the dataset, there are approximately 14,000 registrants. After reviewing the registrations and accounting for late registrants, Shine’s preliminary assessment is that there are approximately 9,500 Original Potential Claimants. Shine has undertaken an initial eligibility assessment and applied the State’s estimated acceptance rate of between 85% and 90% to produce an estimate of 8,000 to 8,500 OECs. Taking the State’s higher acceptance rate, the number comprises approximately 2,331 living OECs and 6,129 deceased OECs.

65    In the settlement approval hearing it was common ground that the range of likely outcomes in terms of the number of OECs is between 8,000 and 9,500.

4.    Overview of the applicant’s case

66    The proceeding is centrally based in the provisions of the Control Acts, the terms of which changed over the claim period.

67    So far as private employment is concerned:

(a)    under the 1936 Act it was not permissible to employ Aboriginals without a permit granted by a State government Protector or Inspector (save for “half-blood” or less persons who did not live in the manner of “full blood” Aboriginal persons, to use the regrettable terms from that legislation). Under the 1954 Act the permit system ceased to exist, and it instead provided that all Aboriginals who were employed or engaged “shall be under the supervision” of the Commissioner of Native Welfare (Commissioner). Following passage of the 1963 Act it was no longer provided that Aboriginals be employed or engaged “under the supervision” of the Commissioner;

(b)    under the 1936 and 1954 Acts, agreements with Aboriginals for service or employment had to be witnessed by an authorised person and provide for “substantial, good and sufficient rations, clothing and blankets”; and

(c)    under each of the Control Acts, the Inspector or the Commissioner had a right of access to all premises where Aboriginals worked or lived.

68    So far as employment within State-run or church-run institutions is concerned:

(a)    under each of the Control Acts, either Aboriginals could be removed and confined to reserves or institutions and the inmates of such reserves or institutions were obliged to follow all reasonable instructions and commands of the manager and could be disciplined, including by specified forms of corporal punishment, or it was permissible to make regulations to permit those things; and

(b)    under the 1936 Act, Aboriginal inmates of reserves or institutions could be “called upon to work during such reasonable hours as the superintendent or manager may direct”, but no person under the age of 14 (or the age of 16 following the 1954 Act) could be compelled to work or placed out at employment without the consent of the Commissioner. The power to call on an Aboriginal inmate to undertake work during reasonable hours ceased following passage of the 1954 Act, but Aboriginal inmates could be required to undertake “industrial training” of 4-6 hours a day.

69    The proceeding makes the following broad claims.

70    Fiduciary claims: The essence of the fiduciary claims is that by the combination of the protective purpose of the powers available to the State under the 1936, 1954 and 1963 Acts (for the currency of each), the power of the State to affect the interests of working Aboriginals who were “controlled” under those Acts (Working Controlled Aboriginals), and the vulnerability and reliance of Working Controlled Aboriginals on the State’s exercise of those powers, there existed a fiduciary relationship between the State and Working Controlled Aboriginals attached to the exercise or non-exercise of statutory powers. This relationship is alleged to give rise to several duties:

(a)    the principal duties are the “Work Duties”, alleged to be owed to Working Controlled Aboriginals in connection with specified statutory powers; and

(b)    secondary limited duties (for persons who were “Native Wards” during the currency of the 1936 and 1954 Acts) are the “Ward Duties”, alleged to arise by reason of the same specified statutory powers but with the addition of the statutory guardian/ward relationship expressed in those Acts.

71    In each case, Mr Street relies on the acts and omissions of the Commissioner, Protectors, Inspectors, Superintendents and Managers (Relevant Officers) as servants or agents of the State.

72    Under the umbrella of the fiduciary claims it is alleged that class members were entitled to fair compensation for the work they performed:

(a)    in the case of work performed by Aboriginal people for private employers (e.g. pastoral stations), the claim against the State is based on the existence of the fiduciary relationship alleged to found the Work or Ward Duties which should have led the State to exercise its power to require the employment arrangements to be such that fair compensation was both payable and paid, supervise them, and pursue the workers’ claims for payment on their behalf against the private employer;

(b)    in the case of work performed by Aboriginal people within State-run institutions, the claim against the State is put in the same way, but more directly because the State was the employer;

(c)    in the case of work performed by Aboriginal people within “non-State-run” institutions (e.g. religious missions), the claim is also direct, on the footing that the superintendents of those institutions were acting as servants or agents of the State, and therefore the State was the employer; and

(d)    it is also put on the alternative footing that compulsory unpaid work of the kind alleged at those places was beyond the power conferred by the Acts, or otherwise repugnant to the imperial proscription on slavery.

73    Direct quantum meruit Aboriginal Institution Claims: An overlapping basis for the claims of some class members is the claim against the State in respect of work required to be done by Aboriginal people, typically children, at Aboriginal Institutions for no pay – either because the Aboriginal Institutions were State-run, or because the managers of “non-State run” Aboriginal Institutions (such as missions) were acting as servants or agents of the State, and therefore the State was the employer.

74    Statutory duty claims: An overlapping basis for the claims of some class members is the claim for breach of statutory duty alleging conduct amounting to dealing in persons in order to be dealt with as slaves contrary to ss 2 and 3 of the Slave Trade Act 1843 (Imp) (Slave Trade Act). That claim asserts the existence of the statutory tort and its breach by (for example) the State knowingly causing or permitting an Aboriginal person to be admitted to an Aboriginal Institution to perform work under conditions of slavery. This claim is maintained for those who did work while in an Aboriginal Institution at any time in the claim period, and those who performed work under the permit system of employment for which the 1936 Act provided.

75    Trust claims: Additional claims are made concerning what are described as the Lost Wages, Management, Ward and Saved Wages Trusts. Each is alleged to be an express or implied statutory private trust arising from the operation of the relevant provisions of one of the Control Acts. For instance, under the 1936 Act the Commissioner was empowered to direct that a portion of wages be paid to him, and the State accepts that amounts were in fact paid and held (being the Saved Wages Trust).

76    RDA claims: The final claim arises under the Racial Discrimination Act 1975 (Cth) (RDA). The applicant alleges that the class members generally have certain common characteristics – in particular, low education, literacy and numeracy, limited financial means and access to legal advice, and mistrust of government. The essence of the RDA claim is that the State 2012 Reparation Scheme in relation to the non-payment or underpayment of wages to Aboriginal workers failed to have proper regard to those characteristics and had the effect of nullifying or impairing the recognition, enjoyment or exercise, on an equal footing, of the class members’ human rights. It is also alleged to have been administered in a way which increased the prospect that people would either not apply, or be unsuccessful if they did. The claim is brought on behalf of (at least) all class members who were alive at the time a complaint in this regard was filed with the Australian Human Rights Commission on 21 July 2020.

77    The relief sought for the fiduciary claims, the statutory duty claims and the trust claims is declaratory relief and general law relief by way of equitable compensation, account (and interest on such monetary relief as is awarded). The relief sought on account of the RDA claims is declaratory and statutory damages under s 46PO(4)(d) of the Australian Human Rights Commission Act 1986 (Cth), aggravated and exemplary damages and an apology.

5.    The principles relevant to settlement approval

5.1    Under Part IVA of the FCA

78    The applicable principles in relation to settlement approval of a class action brought under Part IVA of the FCA Act are well established. Section 33V(1) provides that a representative proceeding may not be settled or discontinued without the approval of the Court. Section 33V(2) provides that if the Court gives such an approval, it may make such orders as are just with respect to the distribution of any money paid under a settlement or paid into the Court.

79    As I said in Webb v GetSwift Limited (No 7) [2023] FCA 90; 414 ALR 500 at [15]-[16]:

The applicable principles in relation to settlement approval under s 33V of the FCA Act are now well-established. The Court’s fundamental task is to determine whether the settlement is fair and reasonable and in the interests of the group members who will be bound by it, including as between the group members inter se: see for example, Australian Securities and Investments Commission v Richards [2013] FCAFC 89 at [7]-[8]; Kelly v Willmott Forests Ltd (in liq) (No 4) (2016) 335 ALR 439; 112 ACSR 584; [2016] FCA 323 at [68]-[77]; Camilleri v Trust Company (Nominees) Ltd [2015] FCA 1468 at [5]; Blairgowrie Trading Ltd v Allco Finance Group Ltd (recs and mgrs. apptd) (in liq) (No 3) (2017) 343 ALR 476; 118 ACSR 614; [2017] FCA 330 at [81]; Caason Investments Pty Ltd v Cao (No 2) [2018] FCA 527 at [12]; McKenzie v Cash Converters International Ltd (No 3) [2019] FCA 10 at [23]-[24]; Smith v Commonwealth (No 2) [2020] FCA 837 at [6]-[12]; and Prygodicz v Commonwealth (No 2) (2021) 173 ALD 277; [2021] FCA 634 at [85]-[88].

In undertaking that task, the Court:

(a)    assumes an onerous and protective role in relation to group members’ interests, in some ways similar to Court approval of settlements on behalf of persons with a legal disability;

(b)    must be astute to recognise that the interests of the parties before it, and those of the group as a whole (or as between some members of the group and other members), may not wholly coincide;

(c)    relatedly to the second point, should be alive to the possibility that a settlement may reflect conflicts of interest or conflicts of duty and interest between participants in the common enterprise which has conducted the representative proceeding;

(d)    should understand that at the point of settlement approval, the interests of the parties will ordinarily have merged in the settlement. It is likely that they both will have become ‘friends of the deal’. As a result, both sides may not critique the settlement from the perspectives of any group members who may suffer a detriment or obtain lesser benefits through the settlement; and (e)    must decide whether the proposed settlement is within the range of reasonable outcomes, rather than whether it is the best outcome which might have been won by better bargaining.

80    The Class Actions Practice Note (GPN-CA) at [15.5] sets out the following factors the Court may consider on an application to approve a settlement:

(a)    the complexity and likely duration of the litigation;

(b)    the reaction of the class to the settlement;

(c)    the stage of the proceedings;

(d)    the risks of establishing liability;

(e)    the risks of establishing loss or damage;

(f)    the risks of maintaining a class action;

(g)    the ability of the respondent to withstand a greater judgment;

(h)    the range of reasonableness of the settlement in light of the best recovery;

(i)    the range of reasonableness of the settlement in light of all the attendant risks of litigation; and

(j)    the terms of any advice received from counsel and/or from any independent expert in relation to the issues which arise in the proceeding.

81    Those factors are derived from Williams v FAI Home Security Pty Ltd (No 4) [2000] FCA 1925; 180 ALR 459 at [19] (Goldberg J) which relied on the factors identified by the United States Court of Appeals for the Third Circuit in In re General Motors Corp Pick-Up Truck Fuel Tank Products Liability Litigation, 55 F.3d 768 (3rd Cir. 1995). There is no requirement to deal with each of these factors; they are to be approached as a useful guide, subject to the circumstances of the particular case: Caason Investments Pty Limited v Cao (No 2) [2018] FCA 527 at [13] (Murphy J).

82    In practical terms, there are three primary aspects to any proposed settlement, which attract different considerations:

(a)    whether the settlement inter partes is fair and reasonable having regard to the interests of the class members, considered as a whole;

(b)    whether the proposed arrangements for distributing the Settlement Sum inter se among the class members are fair and reasonable, again taking the class members as a whole; and

(c)    whether the proposed deductions from the Settlement Sum, for example, for past or future legal costs, for any insurance premiums, and for remuneration of any litigation funder, are fair and reasonable in all the circumstances.

5.2    Under Division 9.2 of the Rules

83    Rule 9.21 relevantly provides:

Representative party - general

(1)    A proceeding may be started and continued by or against one or more persons who have the same interest in the proceeding, as representing all or some of the persons who have the same interest and could have been parties to the proceeding.

(2)    The applicant may apply to the Court for an order appointing one or more of the respondents or other persons to represent all or some of the persons against whom the proceeding is brought.

…

Unlike Part IVA this rule contemplates representative proceedings by either an applicant or a respondent.

84    Rule 9.22 relevantly provides:

(1)    An order made in a proceeding for or against a representative party is binding on each person represented by the representative party.

(2)    However, the order can be enforced against a person who is not a party only if the Court gives leave.

…

85    Nothing in Division 9.2 of the Rules requires leave or approval of the Court before a representative applicant (or representative respondent) can settle a representative proceeding brought under the Division. There is no provision akin to s 33V of the FCA Act. Rule 26.12(4), however, provides that “a representative party must not discontinue a party’s claim without first obtaining the leave of the Court.”

86    As I explained in Sister Marie Brigid Arthur (Litigation Representative) v Northern Territory of Australia (No 2) [2020] FCA 215 at [74]-[79] and O’Donnell v Commonwealth of Australia [2023] FCA 1227 at [18], the authorities indicate that an applicant in a Division 9.2 representative proceeding should not be permitted to compromise a claim in a way which affects the rights of members of the represented class without leave of the Court. Division 9.2 is to be treated as “a flexible rule of convenience” with the Court retaining “the power to reshape proceedings at a later stage”: see Carnie v Esanda Finance Corporation Ltd [1995] HCA 9; 182 CLR 398 at 422 (Toohey and Gaudron JJ).

87    In my view it is appropriate to approach settlement of an “old style” representative proceeding brought under Division 9.2 of the Rules on the same basis as settlement of a representative proceeding under Part IVA of the FCA Act. Before approving a settlement in a Division 9.2 proceeding which affects the rights of represented persons, the Court should be satisfied that the compromise is fair and reasonable in the interests of the represented persons and as between them: Arthur at [79].

6.    the key terms of the proposed settlement

88    Under the proposed settlement the State promises to pay the applicant and class members the Settlement Sum, being an amount of up to $180.4 million, comprising:

(a)    the Settlement Fund Amount, being an amount of up to $165 million, calculated by multiplying $16,500 by the number of OECs, up to 10,000 OECs (on the basis of the eligibility criteria in the SDS, as previously described), to be paid by the State in tranches as the Administrator accepts the eligibility of OECs; and

(b)    the Agreed Costs Component, being an amount of $15.4 million, being party/party costs assessed by the Costs Referee.

89    The Settlement Fund Amount is not to be understood as a series of individual settlements of a particular amount to be paid to each OEC, but rather it is a settlement on a common fund basis where the quantum of the fund is ascertained by accumulating amounts paid on account of (but not to) each OEC.

90    The Settlement Fund Amount is not a fixed sum, and the intersection between the Settlement Deed and the SDS means the latter has implications for ascertainment of what the Settlement Fund Amount is; not just for how it is distributed. The State’s covenant to pay the Settlement Fund Amount capped at $165 million is limited by the Administrator’s determination of the number of OECs, according to the criteria in cl 50 of the SDS. It is common ground between the parties that the eligibility criteria under cl 50 are not intended to create difficult barriers, and over the course of the Registration Process the State progressively agreed to weaken those requirements as it became apparent that they caused difficulties for class members who wished to register.

91    The exact ascertainment of the Settlement Fund Amount will not occur until after the Administrator has made eligibility determinations (which can take into account information provided by Shine and be fast-tracked by State confirmation. This means that the parties and the Court do not yet have data which enables exact calculation of the Settlement Fund Amount. But as I have said, the solicitors for the parties have engaged in a process to preliminarily assess the OECs registered to date. The parties agree that there are likely to be circa 8,000 to 9,500 OECs at the conclusion of the Registration Process, and the Court will assess the proposed settlement by reference to the middle of that range.

92    The Agreed Costs Component of $15.4 million is a maximum sum for party/party costs, rather than a fixed sum. But it has become a fixed sum by the Costs Referee’s assessment that the applicant’s party/party costs exceed $15.4 million.

7.    The salient considerations for settlement approval

7.1    The releases and bars against suit

93    Clause 9 of the Settlement Deed provides the following releases:

On and from the Exhaustion of Appeal Date:

9.1    This Deed may be pleaded as a bar to any further proceedings by the Applicant and Group Members made in, arising out of or in connection with, whether directly or indirectly, the allegations in and the facts, matters and/or circumstances of the Proceeding, against the State Party (including the Respondent’s present and former officers, servants, employees, agents, successors and assigns). Such a bar will not prevent the Scheme Administrator, the Applicant or any Group Members from making any application to the Court in connection with the administration of the Settlement Distribution Scheme.

9.2    The Applicant and Group Members release and forever discharge the State Party (including the Respondent’s present and former officers, servants, employees, agents, successors and assigns), from all actions, proceedings, claims and demands whatsoever which the Applicant and Group Members or any person claiming by, through or under any of them may now or hereafter have against them or any of them for loss or damage sustained by any Applicant or Group Member or any person claiming by, through or under them as a result of or arising out of or in connection with, whether directly or indirectly, the allegations in and the facts, matters and/or circumstances giving rise to the Proceeding.

9.3    The Applicant and the Group Members acknowledge that they, or any person acting on their behalf, have no further claims or demands against the State Party (including the Respondent’s present and former officers, servants, employees, agents, successors and assigns), as a result of, or arising out of or in connection with, whether directly or indirectly, the allegations in, and the facts, matters and/or circumstances giving rise to the Proceeding.

94    The Settlement Deed does not contain a definition of the claims made in the proceeding. But, broadly put, the proceeding brings claims under various causes of action regarding the non-payment or underpayment of wages to Aboriginal men, women and children during the claim period, and a racial discrimination claim regarding the State Reparation Scheme in relation to non-payment or underpayment of wages to Aboriginal workers.

95    The extent of the proposed release of “all actions, proceedings, claims and demands whatsoever” which class members may have “as a result of or arising out of or in connection with, whether directly or indirectly, the allegations in and the facts, matters and/or circumstances giving rise to the Proceeding” was unclear in my view. The breadth of the release and bar against suit gave rise to a concern that the Settlement Deed might purport to effect a release of class members’ claims not raised in the proceeding and non-common claims based in their individual circumstances. For example, it might be argued that the claims of an Aboriginal child who sought to bring a suit against the State for alleged unlawful removal from her family and placement in one of the institutions which are the subject of the unpaid wages claims in the proceeding, or against the State for physical or sexual abuse in one of those institutions, might be argued to arise indirectly from “the facts, matters and/or circumstances giving rise to the Proceeding”. Yet the proceeding does not advance such claims.

96    I considered a release in those terms to be impermissible as this proceeding does not advance any such claims, and the applicant does not have representative authority under Part IVA of the FCA Act beyond the scope of the common claims under s 33C. The applicant represents group members “only with respect to the claim the subject of [the] proceeding, but not with respect to their individual claims.”: Timbercorp Finance Pty Ltd (in liquidation) v Collins; Timbercorp Finance Pty Ltd (in liquidation) v Tomes [2016] HCA 44; 259 CLR 212 at [39], [49], [53]-[54] (French CJ, Kiefel, Keane and Nettle JJ), [122] and [141]-[142] (Gordon J); Dyczynski v Gibson [2020] FCAFC 120; 280 FCR 583 at [96], [106(a)], [201], [249]-[251] (Murphy and Colvin JJ), and [395]-[396] (Lee J). The applicant’s representative authority is not, however, strictly limited to the claims actually pleaded in the proceeding. In Mobil Oil Australia Pty Ltd v State of Victoria [2002] HCA 27; 211 CLR 1 at [34] Gaudron, Gummow and Hayne JJ explained that what is decided in a class action is “the claims that are made, or could be made, against the defendant by all those in the “class” or “group” that is identified in the proceeding” (emphasis added).

97    When the Court suggested that the proposed releases and bars against suit were arguably impermissible the parties conferred and agreed to the following order, which the Court has made.

Any releases, or covenants not to sue given by Group Members are restricted to the claims the subject of this proceeding, and similar or related claims that could have been the subject of this proceeding, insofar as such releases and covenants not to sue are consistent with Part IVA of the Federal Court of Australia Act.

98    With that restriction to the operation of the releases and bars against suit the Court considers the releases to be within the scope of the applicant’s authority.

7.2    The preclusion of unregistered class members sharing in the settlement

99    An important feature of the proposed settlement is that the releases together with the class member registration and class closure orders mean that class members that neither opted out nor eligibly registered pursuant to those orders continue to be class members and therefore bound by the releases. In effect their claims will be merged such that they lose their right to sue and they will not receive compensation under the settlement.

100    While that may seem harsh for such class members, I am nevertheless satisfied that the proposed settlement is fair and reasonable. Essentially that is because:

(a)    the extensive registration and outreach program undertaken by Shine which was well-performed;

(b)    the flexible approach taken in relation to Deficient Registrations given the particular characteristics of the cohort of class members;

(c)    the number of registrants achieved through the Registration Process;

(d)    the several extensions of the deadline for registration; and

(e)    the fact that even after post-settlement approval the Administrator can admit further late registrants (and the State informed the Court that it would take a cooperative approach to that).

I am satisfied that class members were given ample notice that, should they neither eligibly register nor opt out before the deadline, they would be bound by the proposed settlement but be unable to share in the compensation under the settlement.

101    I considered it to be appropriate to make the class closure orders because:

(a)    through the proposed settlement the State sought, as far as practicable, to achieve finality in relation to the claims which are the subject of the proceeding. It would only have practical finality if class closure orders were made so that class members who did not opt out, but who failed to register despite the comprehensive publication regime, and extensive outreach program are bound into the settlement but not entitled to recover under the settlement. I was satisfied that class closure was fair and reasonable given the comprehensive publication regime and outreach program;

(b)    the proposed settlement will benefit the substantial body of class members who made the effort to register their claims, which would permit them to recover compensation without the uncertainty and risk of the case proceeding to trial. Through the publication regime and outreach program class members who had not opted out were informed that should they not register before the deadline (which was then extended) they would be bound by the proposed settlement and thus lose their right to claim damages but be precluded from sharing in the settlement monies;

(c)    it was open to the Court to extend the period for registration, and it did so on several occasions. Even after settlement approval the SDS provides that the Administrator is able to accept late registrations. The State informed the Court that it would take a cooperative approach in that regard; and

(d)    class closure orders would have to be made at some point, and the most efficient course was that they be made then.

102    Further, class members were given the opportunity to object to the settlement, and none objected to the preclusion of class members who neither opt out nor eligibly register. This preclusion is a necessary part of the settlement to afford the State finality in respect of the claims that were or could have been brought in the proceeding.

7.3    Counsels’ Opinion

103    The Court has the benefit of two comprehensive confidential opinions from senior and junior counsel for the applicant which candidly consider the fairness and reasonableness of the proposed settlement as between the parties, and its fairness as between class members. Counsel provided their opinions as officers of the Court rather than as advocates for the applicant and class members. Counsel considered the risks and difficulties facing class members in avoiding the operation of the time limitation defences raised by the State; in proving factual matters from more than 50 years ago including where the person alleged to have performed unpaid work is deceased and the employer or institution where they worked is no longer operating or in existence; in establishing the existence of the alleged Work Duties and Ward Duties and in establishing that the State was liable for any breaches of such duties if they were found to exist; in establishing the existence of the quantum meruit claims; in relation to questions of statutory interpretation including in relation to Imperial proscriptions on slavery; in establishing the existence of any of the trusts in individual cases as a factual matter; in establishing the existence of the alleged statutory duty; in establishing liability in respect of the RDA claims; and associated with achieving quantum in excess of the proposed settlement.

104    Counsel provided a risk-weighted assessment of the reasonableness of the proposed settlement having regard to the risks and difficulties the proceeding faces, and as against best recovery. Counsel recommended that the Court approve the proposed settlement as fair and reasonable inter partes in the interests of the class members to be bound to it. Counsel also gave careful attention to the fairness and reasonableness of the proposed SDS, and recommended that the Court approve the proposed settlement as fair and reasonable as between the class members.

105    The Court has given significant weight to Counsels’ Opinion.

7.4    The stage of the proceedings at which settlement was reached

106    The parties reached the proposed settlement after eight days of testimony by the applicant and a number of class members in the preservation of evidence hearing, after all the evidence for the trial was filed, after the exchange of expert opinions in relation to quantum, following a series of mediations, and five days before the trial was listed to commence. By that point the applicant had filed detailed written opening submissions for the trial, and the State had prepared a detailed confidential written outline of their position for the mediation which the Court has reviewed.

107    The proposed settlement was reached at a point in the proceeding when the parties and their lawyers were in a position to make an informed assessment of the evidence to be adduced at trial, the strengths and weaknesses of their respective cases on liability and quantum, and the costs likely to be incurred by proceeding to trial. This also favours approval of the proposed settlement.

7.5    The complexity and likely duration of the litigation

108    The litigation has been on foot since 2019, and it was for trial in October 2023 on an estimate of four weeks, eight days of testimony already having been heard in the preservation of evidence hearing. The initial trial involved 165 factual and legal issues for determination. The applicant’s written opening submissions exceeded 230 pages in length, without dealing with the State’s defences which were to be addressed in reply.

109    The claims advanced by the applicant are at the high-end of legal complexity and some are attended by considerable difficulty. Many of the legal issues are novel, particularly with respect to the establishment of the alleged fiduciary duties that comprise a central part of the applicant’s case, and the factual issues are complicated by the need for individualised assessments in respect to each class member.

110    Whoever loses the initial trial is likely to appeal. The complexity and likely duration of the litigation weigh heavily in favour of approving the settlement.

7.6    The prospect of appeals and the age of the class members

111    The difficult legal issues involved in the proceeding means that if the applicant is successful on the common issues in the initial trial there is likely to be an appeal, which will take significant time. Then, if the appeal findings are favourable to the class members, more delay will occur while the parties attempt to negotiate either a groupwide settlement or a series of individual settlements, in each case with the prospect of further mini-trials over any claims that are not compromised. Given the highly individualised nature of the claims of class members this not a case where it could be said that favourable liability findings will necessarily lead to substantial damages awards in favour of all class members.

112    The great majority of OECs are already deceased and the living OECs are elderly. Many OECs have passed away since the proceeding was commenced. It is likely that more class members will pass away during the pendency of any attempt to negotiate a groupwide settlement or a series of individual settlements following the result of any appeal(s). The advanced age of many class members, and the importance of their receiving compensation in their lifetime is significant to my view that it is appropriate to approve the proposed settlement.

7.7    The risks of establishing liability and quantum

113    It is necessary to understand that in setting out the risks of establishing liability and quantum I do not purport to decide any question or issue regarding the respective strengths or deficiencies in the parties’ cases in the proceeding. My remarks as to the risks and difficulties are merely in aid of explaining why I consider the proposed settlement to be fair and reasonable.

114    Issues of proof cut across each claim made in the proceeding. The proceeding has particular difficulties because of the historical nature of the claims and, consequently the availability of witnesses who worked during the claim period or the availability of employer witnesses who employed them. Documentary records are generally available to corroborate and supplement witness evidence with respect to the movements, locations and employment of Aboriginal workers during the claim period, but insufficiency of proof remains a serious problem for class members’ claims.

7.7.1    Risks on liability

115    The fiduciary claims: The essence of the fiduciary claims is that there existed a fiduciary relationship between the State and Working Controlled Aboriginals which is alleged to give rise to Work Duties and Ward Duties. These duties are novel in many respects and present a number of factual and evidentiary challenges. First, the alleged duties do not arise by reference to an existing category of fiduciary relationship. Second, there are difficulties in establishing that the alleged fiduciary obligations are consistent with the Control Acts. Third, the Work Duties and Ward Duties are positive in nature and the position in the caselaw is not clear as to whether fiduciary obligations can be proscriptive only, or whether they may extend to prescriptive (i.e. positive) duties.

116    If the applicant is unsuccessful in proving the existence of the alleged fiduciary duties or unsuccessful in establishing that they imposed positive obligations, then a substantial part of the class members’ claims falls away. For instance, the State’s liability in respect of the quantum meruit claims made in relation to private employment is said to arise because of its breach of fiduciary duties in failing to take action to recover the wages due to those Aboriginal workers.

117    State liability for alleged breach of the fiduciary duties: If the Work Duties or Ward Duties are found to exist, there are risks and difficulties in establishing that the State was in breach of those duties (or the other alleged breaches including breach of trust and breach of statutory duty). The applicant advances a direct and indirect theory of liability. For its theory of direct liability, the applicant relies on Trevorrow v State of South Australia (No 5) [2007] SASC 285; 98 SASR 136 to prove that the Relevant Officers were emanations of the State, but contrary conclusions were drawn in Collard v State of Western Australia (No 4) [2013] WASC 455; 47 WAR 1. The applicant bears the burden of distinguishing his case from Collard to succeed on this point. For its theory of indirect liability, the applicant relies upon vicarious liability. That carries a number of risks and difficulties for the applicant.

118    Direct quantum meruit Aboriginal Institution claims: To make out the quantum meruit claims, the applicant faces risks and difficulties in establishing that the directions for an Aboriginal inmate to perform work for no pay at an Aboriginal Institution were invalid or beyond power. It can be argued that the applicant’s case seeks to condition the relevant powers by recourse to contemporary standards, rather than the standards applicable at the time. The applicant’s “slavery claims” involve novel arguments regarding the application of Imperial statutes on issues that are strenuously contested by the State. The slavery claims also raise difficult issues of proof of factual matters from so long ago.

119    Statutory duty claims: The applicant bears the onus of establishing the existence of a statutory duty under the Imperial Slave Trade Act, which is strenuously contested. The fact that the Act imposed penalties for breach points away from the existence of a private right of action. And if the applicant can establish the existence of a statutory duty, the historical nature of the claim presents difficult issues of proof.

120    Trust claims: The applicant has reasonable prospects of proving that the requisite intention of the Control Acts was to establish trusts that were enforceable in equity, and at least in some instances the State admits the existence of the alleged trusts. However, there are risks and difficulties associated with establishing the existence of the trust in relation to individual class members, as well as establishing a breach of the trust, and the continued existence of the trusts. These difficulties stem in large part from the historical nature of the claims, the incomplete nature of available documentary evidence, and the potential absence of important witnesses by reason of being deceased or difficult to locate.

121    RDA claims: The applicant has reasonable prospects of proving that the establishment and operation of the State 2012 Reparation Scheme concerned “acts” involving a distinction based on race, as required by s 9(1) of the RDA. But there are risks and difficulties associated with establishing that the act of setting up the Reparation Scheme, which was implemented in an attempt to redress the wrongs committed under the Control Acts, had either the purpose or the effect of nullifying or impairing a human right on an equal footing to other people. It can be argued that any impairment of human rights was by reason of the Reparations Scheme rather than it flowing from the Control Acts. Further, the degree to which compensable insult was experienced, or is provable, is likely to vary between class members and there can be little certainty that the $20,000 sum sought by the applicant would be appropriate for each class member.

122    The State’s positive defences: The State raises a number of positive defences, which are potentially fatal to the applicant’s case, including the following:

(a)    Laches: A laches defence is alleged by the State on the basis that, as between the parties, it would be practically unjust to give relief which otherwise would be just. The State relies on matters including the substantial period of time that has passed since the claims arose, the unavailability of State witnesses who worked for or on behalf of the State during the claim period, and the deficiencies in the documentary record.

(b)    Limitation periods: The State relies upon a number of limitation periods which it contends apply either directly or by analogy. Subject to the consideration of any grounds justifying the non-application of a limitation period by analogy, the contractual or tortious limitation periods of six years under s 38(1)(c) of the Limitation Act 1935 (WA) and the effective six-year limitation period applicable under s 47 of the Limitation Act 1935 (WA) or s 13 of the Trustees Act 1900 (WA) present serious risks and difficulties for the applicant’s and class members’ claims.

7.7.2    Risks on quantum

123    If the applicant and class members are successful in establishing State liability for the alleged wrongs the class members’ claims face risks and difficulties in relation to quantum.

124    It is exceedingly difficult to reach a well-founded estimate of the undiscounted aggregate value of class members’ claims in the present case, and what constitutes the possible “best recovery” by class members depends upon a series of assumptions, the basis for which is uncertain. For the trial, the parties proposed to rely upon the following expert reports:

(a)    the applicant:

(i)    the report of Joseph Box, a forensic accountant with Grant Thornton, Accountants, dated 17 July 2023 which quantified the applicant’s and sample class members’ general law claims (Box Report); and

(ii)    a reply report of Professor Jeff Borland, a professor of economics at the University of Melbourne who specialises in the operation of labour markets in Australia, dated 29 September 2023 (Borland Report).

(b)    the State: the report of Hans Weemaes, a forensic economist with Vincents, Accountants, dated 25 August 2023 (Weemaes Report).

125    The Box Report quantifies the non-payment or underpayment of wages of the applicant and sample group members by calculating the difference between the amounts that were paid to them and the reasonable value of the work performed by them. As to what the applicant and sample group members had, in fact, received by way of wages during the claim period, the applicant relied upon the evidence given in the preservation of evidence hearing. The difficulty with most of the relevant evidence in the preservation of evidence hearing is that the testimony was far from clear or precise in relation to the wages that were paid or unpaid. That is understandable given the effluxion of time but it does not assist the applicant and class members in establishing the alleged non-payment or underpayment of wages.

126    In relation to the reasonable value of the work performed by the applicant and class members, Mr Box considered a series of historical awards, the Commonwealth Basic Wage system applicable from 1936 to 1967, and the Minimum Wages system applicable from 1962 to the end of the claim period, as they applied in Western Australian. Mr Box calculated interest on both a simple basis (i.e. Court rates) and a compound basis. Given the length of time involved, the loss calculated on a compound basis is an order of magnitude higher than the loss calculated on a simple basis.

127    The Weemaes Report does not engage directly with Mr Box’s calculations. Instead, Mr Weemaes opined on Mr Box’s “economic counterfactual” which he describes as “assum[ing] that if the counterfactual award wage rates were paid instead of the amount allegedly paid, the work performed by the individuals would be unchanged”. In summary, Mr Weemaes expresses the view that such an economic counterfactual failed take into account the impact the significantly increased cost of labour would have had on the demand for labour (and to some extent the supply of labour), that Mr Box has not taken those matters into account, and that his analysis is accordingly unreliable. The thrust of Mr Weemaes’ view as to the appropriate counterfactual is that if Aboriginal workers were required to be paid the wage rates provided under the relevant Awards, the Commonwealth Basic Wage or the Minimum Wage, far fewer such workers would have been employed and for significantly less hours.

128    Professor Borland’s report responded to the Weemaes Report. He opined that the approach taken by Mr Box was reasonable and plausible and that the impact on labour demand in Mr Box’s counterfactual (i.e., that Aboriginal workers were paid the going rate for the general population) is ambiguous. In summary, he expressed the view that the relevant labour market bore the characteristics of a monopsony market in which workers had limited choices of employers, and in such a market, an increase in wages would have an ambiguous effect on labour demand and employment. Professor Borland considered that the impact on labour supply in the counterfactual was unlikely to have affected employment outcomes for the applicant and sample group members. In his view Mr Weemaes’ approach was overstated.

129    Even on the applicant’s method of loss assessment, the highly individual nature of class members’ claims means that the applicant and class members will need to show the nature of the work that was done during the claim period and then value that work with regard to the relevant industry standards and other evidence of what constituted reasonable remuneration. There are likely to be serious difficulties in establishing the nature of the work done, and the hours worked, when the great majority of Aboriginal workers in the claim period are deceased, the employer is no longer operating, and the documentary records are far from complete. Even where an Aboriginal worker from the claim period is still alive, the preservation of evidence hearing illustrates the serious difficulties for witnesses in now giving cogent evidence of matters, at the time utterly mundane, as to the places worked, the periods at each such place, the hours worked, the nature of the work and the pay received, between 52 and 88 years ago.

130    As for the question as to which rate of interest is appropriate to be applied, the applicant needs to show that compound interest is available as a matter of law to justify the materially higher quantum on individual claims. That presents challenges for the applicant and class members because it departs from the orthodox position for breach of fiduciary duty claims. Compound interest may be more readily awarded for the trust claims, but those claims suffer from particular evidentiary difficulties.

7.7.3    Conclusion on the risks of establishing liability and quantum

131    In my view the claims made in the proceeding face serious risks and difficulties in relation to liability and quantum. And because most of the claims arise in respect of conduct between 1936 and 1972, they face a significant risk of being barred by the application of various limitation periods upon which the State relies. Further, the class member’s claims are individual or idiosyncratic, and there are likely to be substantial evidentiary difficulties in proving class members’ claims concerning matters that occurred between 52 and 88 years ago. Most of the Aboriginal people who worked during the claim period are deceased, most of the employers and institutions for whom they worked are no longer operating, many of the relevant witnesses are dead, and the documentary record is patchy. As a result, many class members’ claims face a significant risk of failing by reason of insufficiency of proof of the factual matters on which their claims depend.

132    The risks and difficulties associated with the claims are cumulative in the sense that one risk follows after another, to the point that it is impossible for the applicant’s lawyers to be confident of success in the proceeding. There is a significant risk that if the case proceeds to trial the applicant’s and class members’ claims will fail, or they will succeed on claims which relate to only a subset of the class members and for a quantum less than the proposed settlement.

133    This points strongly in favour of approving the proposed settlement.

7.8    Reasonableness of the settlement in light of the best recovery

134    Assessing the reasonableness of the settlement against “best recovery” is of limited assistance as it involves the unrealistic assumption that the applicant will succeed in full on both liability and quantum. It is more useful to assess the reasonableness of the proposed settlement in light of the attendant risks of litigation. It is therefore not useful to go further into the detail of the competing expert’s reports on the aggregate loss suffered by class members. It suffices to note that the expert estimates of aggregate wage loss vary significantly, and (assuming success on liability) on whichever estimate was accepted by the Court, the proposed settlement represents a substantial discount on full compensation for the wage loss suffered plus interest.

7.9    The reaction of the class

135    46 written objections to the proposed settlement were filed with the Court. Seven class members made oral objections at the settlement approval hearing, including Ms Miller/Kickett and Ms Joanne Taylor who did not file written objections but were nevertheless heard by the Court.

136    The number of objections to the proposed settlement is comparatively small in relation to the number of claimants, but that says little about its fairness. It is the Court’s task to assess the fairness and reasonableness of the proposed settlement and the objections provide a convenient focus for the Court’s consideration: Darwalla Milling Co Ltd v F Hoffman-La Roche (No 2) [2006] FCA 1388; 236 ALR 322 at [39] (Jessup J).

137    Many of the objections were powerfully made and I was touched by the anguish and hurt some objectors expressed about the discriminatory and unjust way they and their parents were treated during the claim period, and the lasting legacy of economic and social hardship which arose from that. The objections speak to the grief, torment and anger that some class members understandably feel. The trauma suffered through forcible removal from their families and their country, and of enduring psychological, social and economic harm, with intergenerational effects, cannot be underestimated. The emotion with which some of the views are expressed acts as a reminder of the importance of acknowledging the occurrence of those wrongs.

138    I have carefully considered each of the objections, which can be summarised as follows:

(a)    Mr Christopher Coomer, a sample group member, filed a detailed and considered objection. He describes being taken from his family and placed in Roelands Native Mission, where he was made to complete farm work between 1960 and 1971. He says that he commenced his first job as a wood chopper at the age of six, filling house firewood storage boxes, and he went on to work in many jobs, including domestic rubbish collection, dairy work, managing the water irrigation systems, property fire break work, fruit picking, road and other infrastructure maintenance, caring for livestock, managing an animal slaughterhouse, maintaining farm paddocks, and helping with church services every Sunday. Mr Coomer describes the long days he was made to work as a child, the physical labour that was required, the poor and often unsafe working conditions, and the abuse that he and others on the mission endured. Mr Coomer alleges that he was not paid for that work and he describes the proposed settlement amount as “very unfair” in those circumstances.

(b)    Ms Vivien Dimer filed an objection on behalf of herself, her grandmother and her father. She said that her grandmother, her father and his brothers were placed on Mount Margaret Mission and her father worked as a stock boy from age 10 or 11 years old without pay, and his parents only received rations. Ms Dimer objects to the proposed settlement on the basis that the proposed settlement is insufficient to compensate for her father’s unpaid work. She also says that she wishes any distribution to which she is entitled to be paid into a trust created by her father.

(c)    Ms Debbie Dalgety, Mr William Dalgety, Ms June Dalgety, Mr Ralpha Dalgety, Ms Ruby Dalgety, Ms Lynette Bellottie, Mr Gay Harris, Ms Leonie Jones, Ms Beverly Lynch, Ms Aubrey Lynch, Mr Lester McDonald and Ms Janette Wilton filed objections that are centrally concerned with the inadequacy of the proposed settlement sum. Ms Jones also objects to the legal costs coming out of the settlement, and says that the government should separately cover those costs. Ms A. Lynch, Ms B. Lynch, Mr Harris and Mr McDonald also complain that the proposed settlement does not account for other unpaid work entitlements such as superannuation and leave.

(d)    Ms June Councillor filed an objection in which she complains that the proposed settlement insufficiently compensates Aboriginal workers for the unpaid work they undertook. She says that Aboriginal men only received rations for their work, and that the disadvantage from that operates as a cycle, and that more money should be paid to account for the “social, emotional and psychological abuse and trauma” that resulted from the unpaid wages.

(e)    Ms Lisa Fay Westlake, Ms Dawn Lesley Little, Mr Desmond Freddie and Mr Richard Evans also filed objections on the basis that the proposed settlement is not sufficient to compensate for the unpaid work performed by their family members, and that it does not compensate for the poor treatment and slavery they suffered. They also object on the basis that the class members were not involved in the decision-making relating to the proceeding and that the decisions in the case were made by white people. They further say that the case should be pleaded to include the trauma suffered by Aboriginal people during that period and that the claim period should be extended.

(f)    Ms Annie Dabb and Mr Henry Dabb object to the proposed settlement on the basis that it does not permit them to make a claim for payment on behalf of their grandfather who worked without pay during the claim period. They state that it is disrespectful not to acknowledge his work and the value of what he contributed and how he fought for Aboriginal people. They also say that no amount of money is going to be enough to right the wrongs that were committed. At the settlement approval hearing, Ms Dabb submitted that the amount of compensation was insufficient because it did not reflect the pay rates applicable in that period, and she says that she is fighting for her ancestors who were treated harshly.

(g)    A number of objectors lodged a joint objection following a meeting of class members at South Headland, Western Australia, on 2 March 2024, being:

(i)    Ms Sharon Todd;

(ii)    Mr Peter Todd;

(iii)    Mr John Patrick Todd;

(iv)    Ms Tanya Nomak;

(v)    Ms Taryn Laura Watkins;

(vi)    Mr James Watkins;

(vii)    Mr Steven Shepard;

(viii)    Ms Jodie Greddon;

(ix)    Ms Jacinta Rose Watkins;

(x)    Mr Zarak William Bin Saad;

(xi)    Ms Jane Bin Saad;

(xii)    Ms Jan Cogan;

(xiii)    Ms Jennifer Joan Baraga;

(xiv)    Ms Patricia McDonald;

(xv)    Mr George Dann;

(xvi)    Ms Beverly Thompson;

(xvii)    Ms Shirley Rose Edwards;

(xviii)    Ms Sophie Edwards;

(xix)    Ms Mareen Agnes Piper;

(xx)    Ms Susan Joyce Lewis;

(xxi)    Ms Alexis Vincent;

(xxii)    Ms Lena Brown;

(xxiii)    Ms Cynthia Ugle; and

(xxiv)    Mr Wayne Smith.

They object to the proposed settlement on the basis that legal costs should not be deducted from the settlement funds, that tax should not be deducted from any compensation payments, and that claims in respect of more remote relatives should be available. At the settlement approval hearing Ms Todd and Ms Lewis made that submission by reference to the work undertaken by their grandmothers and Ms Todd’s mother during the claim period.

(h)    Ms Donelle Marie Narrier objects to the proposed settlement on the basis of the inadequacy of the settlement sum and she questions whether there should be a criminal penalty for the unpaid wages. She seeks a breakdown of the figures for the proposed settlement to understand how the amount was arrived at, complains about the failure to compensate by way of interest on the unpaid wages, and also in relation to legal costs. She set out some of the many ways in which she says people’s lives continue to be affected by the manner of the treatment of Aboriginal people during the claim period, including mental health difficulties, loss of identity through removal from parents at a young age, poverty, lack of education, and other health issues.

139    Ms Miller/Kickett objects to the proposed settlement centrally on the basis that the settlement amount is inadequate to compensate for the work done by her parents who were not paid for their work. She says that her mother was forcibly removed from her family and put into Tardun Mission where she worked in a farmhouse and suffered abuse from age 12.

140    Ms Taylor objects to the proposed settlement on the basis that the claim period should date back to the applicable 1905 Act, and argues that the claim period could have been more appropriately set had the lawyers consulted with Aboriginal communities. Ultimately however, Ms Taylor does not oppose the proposed settlement, because she considered that without it “this case might go on for years.”

141    I now turn to address the central issues raised by the objections.

7.9.1    Inadequate settlement amount

142    The objections to the adequacy of the proposed settlement amount are readily understandable. The proposed settlement does not come near to full compensation for the economic loss suffered by unpaid or underpaid Aboriginal workers during the claim period. But it does not necessarily follow from that that the objections justify refusing to approve the proposed settlement.

143    Here, the substantial and cumulative risks and difficulties of the case mean that it is impossible for the applicant’s lawyers to be confident of success in the proceeding. There is a significant risk that if the case proceeds to trial the applicant’s and class members’ claims will fail, or class members will succeed on claims which relate to only a subset of the class members and for a quantum less than the proposed settlement. The risks on liability and quantum faced by the proceeding are a powerful factor in favour of settlement approval because under the proposed settlement class members will get some compensation.

144    Further, some of the objections regarding the adequacy of the proposed settlement sum are based in complaints regarding the harsh and discriminatory treatment some First Nations people suffered during the claim period. But the proceeding only raises claims regarding the non-payment or underpayment of Aboriginal workers for the work they performed during the claim period; it does not seek compensation for the other mistreatment they suffered.

7.9.2    Excessive deductions from Settlement Sum

145    In relation to the objections directed to the proposed deductions for legal costs, and the contention that the State should have covered all of the legal costs, it is necessary to understand that the Court has no power to rewrite the parties’ agreement. The State agreed to meet the applicant’s party/party legal costs capped at $15.4 million, which is far from a niggardly offer in respect to party/party costs. The Court cannot require the State to offer a higher amount.

146    More fundamentally, as I later explain the Court has given careful attention to the reasonableness of the legal costs proposed to be charged to the class members; it has considered the reports of the independent Costs Referee and has approved costs in an amount substantially lower than the Costs Referee’s recommendation. These objections do not justify refusing to approve the proposed settlement.

147    Other objections concern the operation of Commonwealth taxation laws on the compensation to be received by class members; they do not directly concern the proposed settlement. There is no basis for the Court to refuse to approve the proposed settlement because of the way Commonwealth taxation laws operate.

7.9.3    Inadequacies in the pleaded claims

148    In relation to the objections regarding the claim period in the proceeding and the decision to restrict the claims in the proceeding to complaints about non-payment or underpayment of wages, it is necessary to understand that the pleading of the claims in the proceeding was made by an experienced legal team, including experienced senior counsel, acting for the applicant.

149    Their recommendation to the applicant not to bring a claim for the abuse, ill treatment and discrimination that class members and their family member’s suffered was a forensic decision available to them to make. That is not to deny or minimise the psychological scars and intergenerational effects of the treatment that they endured; it is just that this proceeding is not aimed at achieving compensation for that type of non-economic harm. And their recommendation to the applicant to commence the claim period from the introduction of the 1936 Act was made because of the practical difficulties they foresaw with bringing a case on behalf of people who had worked even longer ago than 88 years. Again, that was a forensic decision available to them to make.

150    These objections do not justify declining to approve the settlement.

7.9.4    The limitation in the SDS to living spouses and children

151    In relation to the objections regarding the restriction in the SDS limiting eligible claimants to those who actually worked during the claim period, or their living spouses and children, the applicant submits that restriction is fair and reasonable because:

(a)    extending the distributions beyond those who actually worked during the claim period, or their living spouses and children, would mean that the payments per claim would be significantly diluted being shared between a greater number of descendants; and

(b)    doing so would introduce a number of complexities in the distribution scheme which would significantly increase settlement administration costs, such that it would outweigh any perceived benefit.

As I explain when dealing with the terms of the SDS, I am satisfied these restrictions are fair and reasonable, and they do not justify declining to approve the settlement.

7.9.5    The decision-making did not involve First Nations people

152    One can well understand why some objectors would complain that the decisions in the proceeding were made by white people, but the decisions in the case were made by both Indigenous and non-Indigenous people. The representative applicant in the case is Mr Street, a senior elder of the Gooniyandi People, and he gave specific instructions in relation to critical aspects of the proceeding, including in relation to the proposed settlement. The seven sample group members are First Nations people, and they also played an important role in the case. Further, Shine engaged in consultation with Aboriginal community leaders at various points, and two members of the applicant’s counsel team, Mr Creamer and Ms Benn, are First Nations people. The Court understands the importance of Indigenous involvement in decision-making in a case where class members have historically been disenfranchised, and it has listened closely to their concerns.

8.    The terms of the SDS

153    The SDS forms part of the Settlement Deed, but it was amended so as to ease the eligibility requirements by a later Head of Agreement between the parties, and then further revised during the course of the settlement approval hearing. I will refer to the revised SDS as the SDS.

154    The four principal features of the SDS are:

(a)    the requirement for class members to register their claims in accordance with the proof and documentation requirements of the Registration Process;

(b)    it provides for payments to the spouse and children of persons who worked in the claim period, but not to more extended relations;

(c)    the criteria adopted for distribution between class members is on the basis of date of birth; and

(d)    the provision for payment of deductions in the amounts, sequence, and timing approved by the Court.

155    In the SDS, “Claimant” means a person in respect of whom the Administrator is determining should be accepted as an OEC or DEC. OEC and DEC mean persons who the Administrator is independently reasonably satisfied meets the respective eligibility criteria set out in clauses 50 and 51 of the SDS.

156    The SDS involves in essence two steps in determining the eligibility of class members to participate in the settlement.

157    First, the SDS provides for Shine to obtain registrations from Original Potential Claimants and Descendant Potential Claimants during the Registration Process. “Original Potential Claimants” are defined as people that worked during the claim period, and “Descendant Potential Claimants” are the spouses and children of Original Potential Claimants who are deceased.

158    The assessment is made by reference to the eligibility criteria, which includes matters as to identification, Aboriginal or Torres Strait Islander identity, whether they were born before 9 June 1962 (i.e. aged at least 10 years old during the claim period), that they were paid no or nominal wages during the claim period, that it relates to at least one nominated workplace in Western Australia which existed at the relevant time, and the provision of information allowing payment to be made.

159    Second, after Shine has made its determinations in respect of these “potential” claimants, a further determination is to be made as to whether such claimants are eligible to receive a distribution. That is a determination as to whether the claimant is an OEC or a DEC. That may occur in one of two ways:

(a)    the State may confirm that the eligibility criteria are satisfied during the Registration Process; or

(b)    the Administrator may determine that the eligibility criteria are satisfied.

160    The Administrator must be satisfied as to eligibility on the basis of “credible and cogent evidence” and has absolute discretion as to what is credible and cogent evidence, taking into account the characteristics of class members.

161    The State has agreed to pay one amount of $16,500 in respect of each OEC claim up to a cap of 10,000 claimants, thereby determining the Settlement Fund Amount.

162    The Administrator will then pay out from that Settlement Fund Amount, after Court-approved deductions, an amount in accordance with the Distribution Criteria (as defined) approved by the Court to eligible claimants. The following principle applies as to the determination of the distributions:

(a)    if the OEC is alive, they are to receive the entirety of the due payment; and

(b)    if the OEC is deceased, a living spouse who is a DEC is to receive the entire payment or, if there is no living spouse, the payment is to be divided equally amongst any living children that are DECs.

163    The Distribution Criteria is provided in Annexure A to the SDS. It proposes a two-category distribution which is differentiated by the OEC’s date of birth. It operates in the following manner:

(a)    OECs born on or before 1930, who it may be assumed spent the majority of their working life under conditions which prevailed in the claim period (or worked either through the entire claim period, or almost all of it) are placed in “Category 1”;

(b)    OECs born on or after 1930 are placed in “Category 2”;

(c)    OECs in both Category 1 and Category 2 receive a base payment of $10,000 (directly or to the relevant DEC/s); and

(d)    OECs in Category 1 receive a “top-up” payment, being a pro-rata distribution of the net surplus remaining in the Settlement Sum, after the making of base payments and the payment of Court-approved deductions by the Administrator.

164    Other key terms of the SDS provide:

(a)    a claimant may seek review of the Administrator’s decision, with Independent Counsel to be appointed for the purpose of making binding determinations;

(b)    the payment of Court-approved deductions including:

(i)    the Court-approved litigation funding charges;

(ii)    the Court-approved legal costs incurred by the applicant;

(iii)    reimbursement payments to the applicant and sample group members; and

(iv)    the Court-approved administration costs for the conduct of the administration, including the costs of any legal advisor who is appointed to advise the Administrator;

(c)    the provision of distribution statements to each eligible claimant by the Administrator, or a rejection notice to unsuccessful claimants;

(d)    the provision for what is to be done with uncollected and residue monies; and

(e)    other general matters, including Court referral of issues arising in relation to the administration of the SDS.

8.1    Whether the SDS is fair and reasonable

165    In Camilleri v The Trust Company (Nominees) Ltd [2015] FCA 1468 at [43]-[44] Moshinsky J usefully summarised the authorities in relation to the fairness of a settlement distribution scheme, as follows:

The cases indicate a number of factors relevant to the assessment whether a proposed distribution scheme is fair and reasonable having regard to the interests of the group as a whole. Some of these factors are as follows:

(a)    whether the distribution scheme subjects all claims to the same principles and procedures for assessing compensation shares;

(b)    whether the assessment methodology, to the extent that it reflects ‘judgment calls’ of the kind described above, is consistent with the case that was to be advanced at trial and supportable as a matter of legal principle;

(c)    whether the assessment methodology is likely to deliver a broadly fair assessment (where the settlement is uncapped as to total payments) or relativities (where the task is allocating shares in a fixed sum);

(d)    whether the costs of a more perfect assessment procedure would erode the notional benefit of a more exact distribution;

(e)    to the extent that the scheme involves any special treatment of the applicants or some group members, for instance via ‘reimbursement’ payments – whether the special treatment is justifiable, and whether as a matter of fairness a group member ought to be entitled to complain.

There are also procedural factors which relate to the fairness of a proposed distribution process, such as:

(a)    whether appropriate individuals have been nominated to administer the scheme;

(b)    whether the procedures for lodging and assessing claims are appropriate and to be conducted in a timely manner;

(c)    whether the scheme incorporates appropriate ‘checks and balances’, such as procedures for ensuring consistency between assessments and meaningful opportunities for review (and objection) by group members.

166    I am satisfied having regard to those matters that the SDS is fair and reasonable as between class members. In particular, it provides for a fair division of the proceeds of the proposed settlement between eligible class members pursuant to the same principles and procedures, the administration process does not involve “judgment calls” except perhaps in relation to the assessment of what constitutes “cogent and credible” evidence of eligibility, the scheme provides a meaningful opportunity for review, and if it proceeds as planned the settlement administration process will not involve unreasonable costs or delay.

167    The design of the Distribution Criteria in the SDS involved a number of structural decisions; given the number of claims, the complexity of some claims, the length of the claim period, and the size and characteristics of the class members, there are many ways in which distribution could be fashioned. The applicant’s representatives designed an SDS which provides for two categories of class member:

(a)    Original Eligible Claimants (OECs); and

(b)    Descendant Eligible Claimants (DECs),

and which applies differential treatment to those two categories.

168    The SDS provides two methods for determining whether potential claimants are eligible to receive a distribution under the SDS, both of which are fair and timely.

169    Under the first method, the proposed SDS facilitates a fast-track determination of eligibility for claims that have received confirmation by the State. Typically, the State’s confirmation follows Shine assisting class members with the registration forms, and endeavouring to validate and pre-qualify class members for registration. Where the State accepts the eligibility of class members put forward through that process, there is no need for the Administrator to repeat the process which will reduce administration costs.

170    Under the second method, where the State does not confirm eligibility, the Administrator is required to make an independent assessment based on clear and cogent evidence. The Administrator has absolute discretion to determine what is clear and cogent evidence for eligibility, and to take into account the characteristics of the class members in doing so.

171    In relation to OECs, the SDS provides that the OEC is to receive the entirety of the due payment if they are alive. If the OEC is deceased, the SDS provides that the OEC’s living spouse, or if there is no living spouse, the OEC’s living children are to receive that OEC’s share. In this regard the SDS approximates the rules of intestacy in Western Australia, but entitlement to a share of the amount attributable to the deceased OEC is limited to that person’s living spouse or children.

172    Given the likely high rates of intestacy within the class, I am persuaded that that approach is appropriate to avoid the wastage and inefficiency of potentially lengthy and expensive disputation about entitlements to deceased estates. It is also appropriate because if eligibility is allowed for descendants further than the living spouse or children of an OEC then the amounts per person are likely to be very small, and the costs of registration and payment to such descendants will substantially consume their share of the Settlement Sum.

173    As earlier explained, the two-category Distribution Criteria provides that all OECs will receive a base payment of $10,000 and provided there are sufficient funds, OECs born on or after 1930 will receive an additional modest “top up” payment. The applicant submits that the Distribution Criteria is fair because it ensures a base payment to all OECs and that a top up payment is available to those class members with the highest claim values on account of that OEC having worked for a longer time during the claim period. The applicant was keen to ensure that those OECs who worked the longest periods without pay should receive more than those who worked shorter periods. While it is open to describe the compensation payable as constituting a limited redress scheme rather than compensation for lost wages, I consider it to be roughly fair to provide slightly more to those who suffered more. The base payment recognises the litigation risk shared by all class members, and the minimum payment quoted to class members in the Settlement Notice.

174    The SDS contains a mechanism for class members to formally request a review of their entitlement or distribution under the Scheme. The Administrator can correct a notice advising of entitlement or distribution if satisfied that the review request discloses an error, slip or omission. In all other cases, the review request is referred to two junior counsel, as approved by the Court, to make a final and binding determination. I am satisfied that this incorporates appropriate checks and balances in the determination of eligibility and distribution.

175    The SDS does not provide for differing methods of payment to class members. Each distribution will be made by Electronic Funds Transfer. Whilst this may raise issues for some class members having regard to their particular circumstances, it must be balanced against the costs associated with providing other modes of payment to the claimant group, some of whom are located remotely. I am satisfied the proposed approach is reasonable.

176    The proposed SDS provides, at the Administrator’s absolute discretion, for the provision of residue monies to an independent charity associated with Aboriginal people as approved by the Court. I am satisfied that it is appropriate.

177    Each of the allowable deductions from the Settlement Sum are for Court-approved amounts, and in a Court-approved priority. I will separately explain the reasons for each of the deductions allowed.

8.2    Appointment of the Administrator

178    Ms Antzoulatos’ evidence shows that Shine sought tenders for appointment as the Scheme Administrator, and received tenders from Grant Thornton, Deloitte, FTI Consulting and McGrathNicol.

179    Shine proposed Grant Thornton as the most suitable firm on the basis of their experience administering a similar scheme in the Queensland Stolen Wages Class Action, Pearson v State of Queensland (QUD 714 of 2016), which concerned similar claims on behalf of Aboriginal and Torres Strait Islander people who worked in Queensland from the 1930s to the 1970s, and also because its tender estimate was competitively priced (although not the least expensive).

180    I accept the applicant’s submission that Grant Thornton’s work in providing expert loss opinions in the proceeding does not disqualify them from being appointed as Administrator. Indeed, the firm’s familiarity with the proceeding may also assist in keeping administration costs down. Grant Thornton is appropriately qualified to be appointed as Administrator. It is an established accountancy firm, with specific experience in conducting a similar settlement administration, with a cohort of class members with similar characteristics, in which it performed its role well.

181    I am satisfied that it is appropriate to appoint Grant Thornton as the Administrator.

8.3    The reasonableness of the settlement administration costs

182    Grant Thornton estimated the costs of the administration at approximately $2.675 million which I consider to be reasonable. Having regard to the range in the tenders I am satisfied that is within the range of what is fair and reasonable. The settlement approval orders however set aside $3 million to ensure there are enough funds to complete the administration, and I approve the deduction of that amount from the Settlement Sum. The settlement administration costs are to be the subject of assessment by the Costs Referee to ensure that they are fair and reasonable.

9.    The legal costs proposed to be charged

183    By orders made 20 November 2023 the Court appointed Ms Kerrie Rosati as the Costs Referee under s 54A of the FCA Act to inquire into and report to the Court as to the fairness and reasonableness of the applicant’s legal costs and as to what proportion of those costs would be recoverable as party/party costs. By orders made on 12 August 2024 the Costs Referee was also directed to provide an opinion on the fairness and reasonableness of costs associated with the post-settlement Registration Process, including the physical outreach program.

184    Initially, Shine proposed legal costs to the Costs Referee totalling $33,252,230 (representing $24,511,099 in fees and $8,741,131 in disbursements). The applicant’s document “MFI-1” shows the costs of the proceeding which the firm put forward to the Costs Referee, for the period up and including the settlement approval hearing on 28-29 October 2024. Up to 1 October 2024 it states the costs which were the subject of assessment by the Costs Referee, and after 1 October 2024 it includes estimates. It provides: