Federal Court of Australia

J Wisbey & Associates Pty Ltd v UBS AG (No 3) [2025] FCA 1018

ORDERS

OTHER MATTERS:

These orders adopt the defined terms used in the orders made on 7 May 2025.

THE COURT ORDERS THAT:

Approval of the settlement

1.    Pursuant to ss 33V and 33ZF of the Federal Court of Australia Act 1976 (Cth) (Act), the settlement of this proceeding be approved on the terms set out in:

(a)    the deed of settlement entered into between the parties and executed on 1 May 2025 (Deed), annexed as Annexure ‘KN-1’ to the affidavit of Kimi Nishimura dated 5 May 2025; and

(b)    the settlement distribution scheme, annexed as Annexure ‘KN-16’ to the affidavit of Kimi Nishimura dated 1 August 2025 (Settlement Distribution Scheme).

2.    Pursuant to s 33ZF of the Act, the Court authorises the Applicant nunc pro tunc to enter into and give effect to the Deed and the transactions contemplated therein for and on behalf of Group Members (being those persons who meet the definition of “Group Member” in paragraph 1 of the Amended Statement of Claim dated 19 November 2021 and who did not file an opt-out notice in accordance with the orders made on 5 April 2024).

3.    Pursuant to ss 33ZB and 33ZF of the Act, the persons affected and bound by these orders and the settlement of the proceeding be the Applicant, the Respondents and Group Members.

Registered Group Members, Late Registrants and Bot Registrants

4.    The persons referred to at paragraphs 296 and 300 of the affidavit of Kimi Nishimura dated 1 August 2025 are to be treated as Registered Group Members for the purposes of the Settlement Distribution Scheme.

5.    The Bot Registrants referred to in paragraph 302 of the affidavit referred to in order 4 are to be considered invalid registrations and are not to be treated as Registered Group Members for the purposes of the Settlement Distribution Scheme.

6.    Pursuant to ss 33ZB and 33ZF of the Act, any Group Member who is not a Registered Group Member will remain a Group Member for all purposes of this proceeding but shall not be permitted to seek any benefit pursuant to the settlement approved by this Court.

Appointment of Administrator

7.    Pursuant to ss 33V(2) and 33ZF of the Act, Maurice Blackburn be appointed administrator of the Settlement Distribution Scheme (Administrator) and is to act in accordance with the rules of the Settlement Distribution Scheme and is to have the powers and immunities conferred by the Settlement Distribution Scheme, subject to any direction of the Court.

8.    The Administrator has liberty to apply in relation to any matter arising under the Settlement Distribution Scheme including for the purposes of seeking orders consequential to or in connection with the Deed and/or the Settlement Distribution Scheme.

Approval of amounts to be deducted pursuant to the Settlement Distribution Scheme

9.    Pursuant to ss 33ZF and 33V of the Act, and for the purposes of the Settlement Distribution Scheme, the following distributions from the settlement sum be approved:

(a)    the amount of $30,870,338.61 (including GST) in respect of the Applicant’s legal costs and disbursements incurred in connection with the conduct of the proceeding on its own behalf and on behalf of all Group Members, including the costs of obtaining settlement approval;

(b)    the amount of $3,047,800 in respect of the ATE Insurance Costs;

(c)    up to the amount of $380,043.32 (including GST) to be paid to the Administrator in accordance with clause 11.3(a), 13.1(a) and 13.5(a) of the Settlement Distribution Scheme for the costs and disbursements incurred by the Administrator in connection with the administration of the Settlement Distribution Scheme; and

(d)    the amount of $74,850.28 to be paid to the Applicant as reimbursement for its time and expenses incurred in acting as representative party in this proceeding.

Confidentiality

10.    Pursuant to ss 37AF and 37AG(1)(a) of the Act and until further order, to prevent prejudice to the proper administration of justice within the meaning of s 37AG(1)(a) of the Act, the material contained in:

(a)    Part 1 of Schedule A to these orders is confidential and not to be published or disclosed without the prior leave of the Court to any person or entity other than the Court, the Applicant and the Applicant’s legal representatives; and

(b)    Part 2 of Schedule A to these orders is confidential and not to be published or disclosed without the prior leave of the Court to any person or entity other than the Court, the Applicant, the Respondents and the parties’ legal representatives.

Other orders

11.    Within 30 days of the completion of the administration of the Settlement Distribution Scheme, the Administrator shall apply to the Court for orders dismissing the proceeding with no order as to costs and vacating all costs orders in the proceeding.

12.    Such further or other orders as the Court deems fit.

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

Schedule A

[Not reproduced]

REASONS FOR JUDGMENT

BEACH J:

1    The applicant, J Wisbey & Associates Pty Ltd, has brought this representative proceeding pursuant to Part IVA of the Federal Court of Australia Act 1976 (Cth) against five respondent banks being UBS AG, Barclays Bank Plc, Citibank N.A., JPMorgan Chase Bank N.A. and NatWest Markets Plc, which is formerly the Royal Bank of Scotland.

2    The claims advanced by the applicant concern the respondents’ alleged cartel conduct in the foreign exchange (FX) market. This alleged conduct is said to have artificially increased the price of FX instruments, and to have caused loss to the applicant and group members.

3    The group members are all persons who at any time between 1 January 2008 and 15 October 2013 (the relevant period) were parties to FX instruments in relation to one or more pleaded affected currency pairs which were arranged in Australia to the total value of or more than the minimum transaction volume, and who suffered loss or damage by reason of the respondents’ conduct.

4    Now following the implementation of a soft class closure mechanism and two mediations, in February 2025 the parties reached an in-principle settlement of the proceeding requiring the respondents to pay a settlement sum of $59 million. The in-principle settlement is recorded in a deed of settlement executed by the parties on 1 May 2025.

5    My approval of the settlement was sought under s 33V(1) of the Act, which approval I gave on 15 August 2025. These are my reasons for giving such approval. I have also made several observations on related topics.

6    Now the applicable principles are not in doubt concerning whether to approve a settlement under s 33V. The following short points can be made.

7    First, my discretion is broad and its exercise is only limited by the necessity that it be exercised judicially having regard to the particular circumstances of the case.

8    Second, the central question is whether the proposed settlement is a fair and reasonable compromise of the claims made on behalf of the group members who will be bound by the settlement.

9    Third, one approaches the question by asking whether the proposed settlement is fair and reasonable as between the parties having regard to the claims of the group members (inter partes fairness), and then whether the proposed settlement is fair and reasonable as between the group members (inter se fairness).

10    Fourth, there is not usually one single or clear way in which a reasonable settlement should be framed. Reasonableness is a range, and the question is whether the proposed settlement falls within that range.

11    Fifth, the parties and their legal representatives are often in a better position to appreciate the risks associated with the proceedings. Moreover, different parties will have different appetites for risk. It is not my present task to second-guess the commercial strategies or decisions made by an applicant’s legal representatives, but rather to satisfy myself that any decision is within the reasonable range of decisions that are open.

12    Sixth, in determining whether to approve a proposed settlement, the Court assumes a protective role in relation to group members’ interests. In this respect the interests of the parties may not wholly coincide with the interests of group members. Relatedly, the parties may have an affection for the deal and consequently may not critique the settlement from the perspective of group members who may be disadvantaged by the proposed settlement.

13    Seventh, in relation to inter se fairness, a particular concern is to confirm that the interests of the representative applicant or signed-up clients of a given firm of solicitors are not being preferred over the interests of other group members. And any settlement distribution scheme should be framed to achieve a broadly fair and cost-effective division of the proceeds, including treating like group members alike. This may involve judgment calls being made where a range of alternative approaches might have been open to be adopted.

14    Eighth, inter se fairness also involves other procedural considerations as to the fairness of a proposed distribution process, such as whether appropriate individuals have been nominated to administer such a process, whether the procedures for lodging and assessing claims are appropriate and to be conducted in a timely manner, and whether the proposed distribution scheme incorporates appropriate checks and balances such as procedures for ensuring consistency between assessments.

15    Ninth and more generally, the above considerations are not exhaustive and some are not mandatory. And even more generally, the decision as to whether to approve is evaluative and in part impressionistic.

16    I would also refer to and adopt the discussion of the relevant principles in McDonald v Commonwealth of Australia [2025] FCA 380 at [119] to [121] and [360] to [365] per Mortimer CJ and of course in Camilleri v The Trust Company (Nominees) Limited [2015] FCA 1468 at [5], [32] and [39] to [44] per Moshinsky J.

17    Now before proceeding further, let me set out an overview of the issues in the proceeding.

Overview of issues in the proceeding

18    It is alleged that there existed a global FX market in which dealers supplied FX instruments to customers in global trading centres including in Australia through FX sales desks and electronic communication networks. In the alternative, it is alleged that there existed an Australian FX market in which dealers supplied FX instruments to customers in and outside Australia. It is alleged that each of the respondents supplied, offered to supply and/or were willing and able to supply FX instruments to customers in one or more of the global trading centres including in Australia, and did so in competition with one or more of the other respondents and one or more of certain other entities, being other unidentified cartel participants.

19    Now a central allegation is that during the relevant period, the respondents and other cartel participants arrived at an arrangement or understanding containing a provision that each of them would co-operate with the others in relation to trading in FX instruments by sharing non-public information concerning current or potential future trading, co-ordinating their trading, and keeping confidential the existence of the understanding and any conduct giving effect to it; I will refer to this as the FX understanding, and the FX understanding provision.

20    The FX understanding is said to be inferred from the conduct of the respondents and other cartel participants described in the overt acts spreadsheet accompanying the applicant’s pleading which refers to conduct between FX traders in various internet chatgroups. The respondents and other cartel participants are said to have given effect to the FX understanding provision by doing what they arranged they would do, that is, sharing non-public information, co-ordinating trading and concealment.

21    Further, it is alleged that the respondents variously arrived at a series of more confined arrangements or understandings of different permutations and combinations in 150 chatgroups set out in the overt acts spreadsheet, containing the same provisions in respect of co-operation as the FX understanding provision; I will refer to the more confined understandings as the FX chatroom understandings, and each provision as the FX chatroom understanding provision.

22    It is alleged that the respondents who were parties to each FX chatroom understanding gave effect to the FX chatroom understanding provision by doing what they arranged they would do, that is, sharing non-public information, co-ordinating trading and concealment.

23    On the basis of this conduct, the following alleged contraventions are said to have occurred.

24    First, it is alleged that by making or arriving at the FX understanding, at all material times prior to 24 July 2009 each of the respondents contravened s 45(2)(a)(ii) of the Trade Practices Act 1974 (Cth) (TPA).

25    Second, it is alleged that by giving effect to the FX understanding provision, at all material times prior to 24 July 2009 each of the respondents contravened s 45(2)(b)(ii) of the TPA.

26    Third, it is alleged that at all material times on or after 24 July 2009, by making or arriving at the FX understanding each of the respondents contravened s 44ZZRJ of the TPA and/or s 44ZZRJ of the Competition and Consumer Act 2010 (Cth) (CCA), as applicable.

27    Fourth, it is alleged that at all material times on or after 24 July 2009, by giving effect to the FX understanding provision each of the respondents contravened s 44ZZRK of the TPA and/or s 44ZZRK of the CCA, as applicable.

28    Moreover and more specifically, it is alleged that during the relevant period, the FX understanding provision had the purpose, directly or indirectly, of restricting supply of FX instruments. It is said that the FX understanding provision was therefore an exclusionary provision within the meaning of s 4D of the TPA and CCA. And it is said that by making or arriving at the FX understanding the respondents breached s 45(2)(a)(i) of the TPA and the CCA. Further, it is said that by giving effect to the FX understanding provision the respondents breached s 45(2)(b)(i) of the TPA and the CCA.

29    Moreover and more specifically, it is alleged that the FX understanding provision had the purpose, or would have or be likely to have the effect, of substantially lessening competition in the global FX market and the Australian FX market. It is said that during the relevant period by making or arriving at the FX understanding each of the respondents contravened s 45(2)(a)(ii) of the TPA or the CCA as applicable from time to time. And it is said that by giving effect to the FX understanding provision each of the respondents contravened s 45(2)(b)(ii) of the TPA or the CCA.

30    Cognate causes of action are pleaded with respect to each of the FX chatroom understandings and the FX chatroom understanding provisions.

31    Now it is said that in the relevant circumstances in making the FX understanding and giving effect to the FX understanding provision the respondents caused increased volatility, increased adverse selection risk, and decreased competition. It is said that this in turn caused spreads to be increased on affected currency pairs in the global FX market and/or the Australian FX market. And it is said that this caused the mid-points of spreads for trades in affected currency pairs in the global FX market and/or the Australian FX market to be different to what they would otherwise have been throughout the relevant period. Further, it is said that the effect on spreads and mid-points was passed on to downstream sellers and buyers of FX instruments, including the applicant and most group members. It is said that this effect on spreads and mid-points was reflected in the price of outright forward contracts, the price of which is based on spot prices adjusted for interest rate differentials between the two currencies being traded. In summary, it is said that these matters and circumstances were the occasion for and produced the group members’ losses.

32    Further, the same loss theory is advanced with respect to the FX chatroom understandings and the FX chatroom understanding provisions.

33    Now the applicant and group members sought to recover damages pursuant to s 82 of the TPA and CCA. Further, they argued, for the purposes of any limitation period, that loss or damage did not crystallise until the artificiality of the operation of the relevant FX market was discovered. Alternatively, the applicant said that by reason of the respondents’ collusive conduct, it and the group members or some of them suffered compensable loss or damage within the meaning of s 82 by being deprived of an opportunity to commence a proceeding for damages prior to the expiry of the limitation period.

34    Now the respondents have denied the allegations against them and have raised numerous arguments against liability, causation and loss and damage, which can be synthesised in the following fashion.

35    First, they say that there was no global FX market or Australian FX market as defined by the applicant. Second, they say that the respondents did not make or give effect to the FX understanding or any cognate provision. Third, they say that the respondents did not make or give effect to the FX chatroom understandings or any cognate provision. Fourth, they say that any cognate provision did not have the purpose or effect of fixing prices with respect to FX instruments, restricting supply or substantially lessening competition. Fifth, they say that the respondents’ conduct did not cause loss or damage to the applicant and group members in the manner alleged. Sixth, they say that the applicant and group members are prevented by operation of the six year limitation period in s 82 of the TPA and the CCA from recovering any loss or damage incurred before 27 May 2013.

36    The respondents have also made the following other points which it is worth referring to.

37    First, they say that to the extent there was any artificial impact on spreads as alleged, any loss suffered by entering into FX transactions could be set off against profits achieved by being on the other side of loss-making transactions.

38    Second, they say that the group members cannot recover damages in this proceeding insofar as their claims are encompassed by releases obtained by the respondents in settled overlapping overseas proceedings.

39    Third, they say that any loss or damage that was passed on or passed through cannot be recovered. Let me elaborate on this point.

The question of pass through

40    Now there are tricky legal issues raised as to whether any passing on or pass through so-called defence is available as contended for by the respondents.

41    The respondents have put the argument on two levels. First, it was said that where the direct purchaser purchases the product or service from the contravening party and then resells it to indirect purchasers, then there is a first level pass through insofar as the increased price(s) is a component of the price in the on-sale. Second, it was said that where a retail FX platform operates via a dealer model whereby it uses proprietary algorithms for generating bid and ask quotes that are based on its own inventory and a data feed from the interbank market, then, to the extent that any loss is incurred, that loss is subject to a second level pass through that forms part of an overall cost structure that direct purchasers recover through sales of their own products or services.

42    Now the availability of the so-called defence of passing on or pass through under Australian competition law is uncertain.

43    In a case that I have some familiarity with being Auskay International Manufacturing & Trade Pty Ltd v Qantas Airways Ltd (2008) 251 ALR 166, which was a class action concerning price fixing in relation to airfreight services, Tracey J observed in determining a pleading strike out application the following (at [39]):

It does not follow that, simply because a group member who dealt directly with one or more of the respondents was charged a higher rate as a result of the alleged cartel arrangement, that group member suffered any loss. If the group member who had dealt directly with a respondent had passed on the full cost of the international airfreight services to all of its clients in the relevant period it would seem to have suffered no loss. Similarly any clients who passed on the charges further along the distribution chain would seem to have suffered no loss. These possibilities highlight the need for the applicant to clarify the case to which the respondents will be required to respond. Whilst the applicant may not and cannot know the precise particulars which will be relied on by each group member to support a claim of economic loss, it is certainly in a position to plead the material facts upon which it seeks to establish its own claim. It has not done so.

44    Tracey J also made the following comments (at [41] to [43]):

It has yet to be determined authoritatively whether a respondent who is facing a loss and damages claim under s 82 has a defence if it is shown that the applicant has passed on to customers or clients all additional costs occasioned by the implementation of an agreement made in contravention of a provision of the Act.

United States anti-trust jurisprudence denies a passing on defence to respondents who have dealt directly with applicants. On the other hand, it has been held that indirect purchasers of goods and services have no standing to sue for damages for anti-trust breaches under federal anti-trust law save for some immaterial exceptions: see Hanover Shoe, Inc v United Machinery Corp 392 US 481 (1968); Illinois Brick Co v Illinois 431 US 720 (1977). The passing on defence is not available to those who have dealt directly with an applicant for a variety of reasons. They include the difficulty in analysing price and output decisions in the “real economic world” and the evidentiary complexities and uncertainties involved in analysing the impact of an overcharge on a firm’s profits. The refusal to grant standing to indirect purchasers is justified on the ground that a respondent should not be exposed to multiple liability and double recovery in respect of the same conduct.

It remains to be seen whether a similar approach will be adopted by Australian courts. In Commissioner of State Revenue (Vic) v Royal Insurance Australia Ltd (1994) 182 CLR 51; 126 ALR 1 the High Court held that a “passing on” defence was not available to a defendant to a restitutionary claim where the plaintiff had passed on the burden of excessive workers’ compensation premiums. It may be doubted that this decision will have any impact on the liability of the present respondents for damages under s 82 of the Act. This is because restitutionary relief is not designed to provide compensation for loss. Rather it is designed to restore to the plaintiff that which has been transferred to the defendant thereby unjustly enriching the defendant: see M Rush, The Defence of Passing On, Hart Publishing, Oxford, 2006, pp 43–7. …

45    Moreover, some years ago I had further cause to consider the pass through question (J. Beach QC “Class Actions: Some Causation Questions” (2011) 85 ALJ 579 at 590 to 592). I made the following observations on the topic in the cartel context.

46    To determine whether a claimant’s capacity to pass through any overcharge to purchasers downstream is relevant to damages requires consideration of the scope of ss 82 and 87 of the CCA. Sections 82 and 87 employ similar language and concepts. Each is conditioned on a finding that a person has suffered (or, in the case of s 87, likely to suffer) loss or damage caused by conduct of another person that was “done” (s 82) or “engaged in” (s 87) in contravention of the CCA. Under s 82, a cause of action arises only when actual loss or damage has been suffered. Under s 87 a cause of action will also arise when loss or damage is likely to be suffered. Otherwise, the sections share the same principal elements, and they have an essentially compensatory purpose. An order made under s 87 may only compensate the claimant for the loss or damage or reduce or prevent the loss or damage; in both cases the loss and damage suffered or that is likely to be suffered by the claimant sets the limit. The phrase “loss or damage” has its ordinary natural meaning and encompasses any form of economic loss due to prejudice or disadvantage occasioned by a respondent’s unlawful conduct. Under s 82 a comparison must be made between the position in which the party that allegedly has suffered loss or damage is and the position in which that party would have been but for the contravening conduct. By analogy, a similar analysis is undertaken for s 87 in terms of comparing the actual position with the counter-factual.

47    Claimants in the cartel context have usually sought as damages an amount referable to the payment of any overcharge, being the difference between the amount paid by the claimants to the supplier during the cartel period, and the amount that would have been paid but for the alleged cartel conduct. But assuming that a claimant paid an overcharge, it does not follow that his financial position would necessarily have been adversely affected by the contravening conduct; if the claimant was able to fully pass through the overcharge to customers, he may not have suffered any financial loss. The relevant comparison is between the actual financial position and the financial position the person would have been in but for the contravening conduct. If the claimant is able to pass through the overcharge to persons downstream, such that the claimant is in no worse a financial position than would have been the case but for the contravening conduct, he has suffered no loss or damage. Now some claimants have attempted to avoid this unsurprising conclusion.

48    First, they have relied on the US approach in Hanover Shoe Inc v United Shoe Machinery Corp 392 US 481 (1968) and Illinois Brick Co v Illinois 431 US 720 (1977), which does not permit any pass through consideration. But the US position is not transposable to ss 82 and 87. The US approach is more focused upon imposing punitive relief (treble damages) for contraventions of s 1 of the Sherman Antitrust Act 1890 (15 USC 1). Further, the US approach necessitates the refusal of claims brought by indirect (or downstream) purchasers of products. It is a corollary of such refusal that no pass through consideration is entertained.

49    Now to take into account pass through is consistent with the position of looking at part or all of the true loss as residing in the end user, with recovery then permitted by the end user. If you allowed recovery by the end user, then without permitting pass through to be looked at, you would have the potential problem of double recovery, that is, recovery by both the direct purchaser and the indirect purchaser of, in substance, the one loss. But if you do not allow recovery by the end user (the US position) then there is no question of double recovery. In such circumstances, no problem arises if pass through is not looked at in claims made by the direct purchaser.

50    But under ss 82 and 87, claims by indirect purchasers cannot be disallowed. Claimants can be either direct or indirect purchasers. Therefore, if an indirect purchaser can claim loss, because the direct purchaser has passed the overcharge through, then if you did not subtract the pass through component from the direct purchaser’s claim, you would have double recovery as against the supplier. Interestingly, if the group description in a cartel class action embraced both direct and indirect purchasers, the lawyers representing the class would have to face up to this duplication question and also potential conflict issues directly. But if the class was limited to the direct purchasers, although the legal analysis is not altered, there may be fewer practical problems.

51    Second, some claimants have relied on restitutionary type claims or remedies to avoid pass through. The idea is that a pass through defence cannot be relied upon to defeat or reduce such a claim. A money had and received claim has its focus on depriving the defendant of gains received, that is, the overcharge received by the supplier, rather than compensating the plaintiff for the losses incurred, where pass through should be taken into account; see Commissioner of State Revenue (Vic) v Royal Insurance Australia Ltd (1994) 182 CLR 51 at 75, 78, 90 and 91; Roxborough v Rothmans of Pall Mall Australia Ltd (2001) 208 CLR 516 at [68] and [69]; see also Rush M, The Defence of Passing On (Hart Publishing, Oxford, 2006) p 47; Eglezos M, “Recovering Cartel Damages: The Passing-on Defence under the Trade Practices Act” (2010) 38 ABLR 174 at 186; Auskay International at [39] to [43]. Claimants have sought to rely both on this “liberal action in the nature of a bill of equity” (Clarke v Shee (1774) 1 Cowp 197; 98 ER 1041 at 1042 per Lord Mansfield; Roxborough v Rothmans at [83], [90] to [93]) and s 87 to avoid the pass through issue. But such restitutionary devices are arguably not open to them.

52    It would seem that s 87 does not permit restitutionary type orders. It empowers the court to make such orders as it thinks appropriate if the orders will compensate a person in whole or in part for the loss or damage or will prevent or reduce the loss or damage. As stated in Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494 at [43]: “[T]he Court can make orders under s 87 only insofar as those orders will compensate (or will prevent or reduce) the loss or damage that is identified.” So, the ceiling on claimants’ recovery is their actual loss or damage. Further, Multigroup Distribution Services Pty Ltd v TNT Australia Pty Ltd (2001) 109 FCR 528 at 546 concluded that the majority’s decision in Marks was that the now CCA remedies were directed to compensation and not the prevention of unjust enrichment. Further, and equally importantly, if actual loss is recoverable under s 82, there is little basis for reading s 87 as conferring a discretionary power to take away or modify the right conferred by s 82 (I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109 at [60], [61], [69], [115] and [117] to [120]). In other words, the analysis falls back, in effect, to s 82 where the pass through issue cannot be avoided.

53    In I & L Securities, s 87 was sought to be used to reduce the damages otherwise awardable under s 82. In the present context, claimants have sought to use s 87 to increase the monetary award beyond that permitted by s 82 (if s 82 requires pass through to be taken into account).

54    And apart from s 87, there is also no basis for a money had and received claim on the basis of mistake or a failure of consideration. Such claims are usually inapplicable to payments made under enforceable contracts; they only apply where a contract has been set aside (see Barclays Bank v WJ Simms Son & Cooke (Southern) Ltd [1980] QB 677 at 695, referred to in David Securities v Commonwealth Bank (1992) 175 CLR 353 at 376 (fn 82); Brenner v First Artists' Management Pty Ltd [1993] 2 VR 221 at 257; Pan Ocean Shipping Co v Creditcorp [1994] 1 All ER 470 at 475, approved in Lumbers v W Cook Builders (2008) 232 CLR 635 at [79]; Newitt v Leitch (1997) 6 Tas R 396 at 408 and 409). Otherwise, acquirers of products could bring money had and received claims for part of the purchase price, whenever they later discovered that the product purchased had a lower market value than perceived at the time of acquisition and that they acted under the mistaken belief concerning its market value. Generally, a contract is not void, or capable of being rescinded, merely because the party seeking the remedy held a mistaken belief about some matter affecting the contract, including the price payable thereunder or its basis, but was not otherwise mistaken about its terms.

55    That general position is predictably reinforced in Roxborough v Rothmans, albeit that the case was ultimately analysed in terms of a failure of consideration rather than one of mistake. Tobacco retailers made a money had and received claim for the component of the purchase price paid by each of them to Rothmans, representing Rothmans’ liability to pay wholesale licence fees to New South Wales. The payment of this component was on the basis that the NSW law that imposed the wholesale licence fees on Rothmans was valid. After the relevant payments had been made (under the relevant contracts with Rothmans to cover those fees), the NSW law was struck down as a duty of excise. The Full Federal Court rejected the retailers’ claim. The majority said that the rights between each retailer and Rothmans were governed by valid and enforceable contracts; consequently, there was no money had and received claim.

56    Although the majority in the High Court overturned that decision, they did so on a limited basis. The majority concluded that there had been a failure of consideration, which effectively entitled each retailer to restitution of the component of the purchase price paid by each of them to Rothmans representing the wholesale licence fees assumed to be payable by Rothmans to New South Wales. Each contract specifically provided for the payment of this component as a discrete amount, with the purpose for the payment of the discrete amount to enable Rothmans to discharge its obligations under the NSW law. When that law “fell”, the purpose for the payment of each discrete amount failed. Consequently, there was a failure of consideration for each payment as a discrete obligation (Roxborough v Rothmans at [16] to [19], [21], [56], [60], [101] to [109] and [199]). The case may also be analysed through the mistake lens, the mistake being one of law. But the facts were exceptional. Normally, the consideration payable for goods or services under a supply contract is not so divisible. And where it is not so divisible or separately allocable to discrete components, nothing in the case supports any money had and received claim to recover part of the price.

57    By its treatment of the exception, the High Court reinforced the general. And in the cartel context, the over-charge component in the price paid, at best, would only be identifiable ex post facto; there is no ex ante discreteness enshrined in the contractual terms or at the time of payment. There can be no money had and received claim for the overcharge component.

58    Finally, I have talked of pass through as if it was a species of defence for damages claims. But it is not a formal defence. There is no legal or evidentiary onus on the respondent, although it may be prudent to flag the issue in any defence. Rather, the claimant must prove damage, of which the pass through component is one aspect that the claimant must address.

59    Now clearly in the present context there are significant risks concerning the claims of the group members concerning the pass through question and I have considered this in terms of the reasonableness of the settlement sum and giving my approval. But nothing further need be said. Let me turn to another topic.

A little on class closure

60    Previously and over the opposition of the applicant, I imposed a soft class closure regime on the applicant and group members (J Wisbey & Associates Pty Ltd v UBS AG (No 2) [2024] FCA 147).

61    Now one of the arguments put by the applicant was that to impose soft class closure would prejudice the interests of group members. And the underlying theme behind many of the arguments put by the applicant was that the proceeding would likely settle for far less at mediation if I imposed a soft class closure mechanism at that stage, than if the associated group member registration process was postponed until after an in-principle settlement had been reached.

62    The applicant’s case on this question was as follows (J Wisbey v UBS (No 2) at [136] to [145]):

Ms Nishimura’s evidence describes the deterrent effect that the proposed class closure orders will have on group members registering their interest in participating in this proceeding prior to any settlement offer.

Based on her experience, Ms Nishimura opines that group members in this proceeding, including institutional investors, are more likely to register if there is an in-principle settlement. Group members with pre-existing and continuing commercial relationships with the respondents would, in that scenario, be less concerned about being seen as participating in active litigation against the respondents; and the cost / benefit analysis of taking a step to participate in settlement would be much clearer once the quantum of proposed settlement is known. Further, the reticence of some group members to register before settlement is exacerbated here by the respondents’ proposal that registration involve the identification of individual group members, and the resulting loss of anonymity hitherto enjoyed by group members in the proceeding.

Further, the evidence of Mr Michael Lange, an experienced class actions lawyer now employed by leading claims aggregator firm FRT, is to the same effect. Mr Lange gives evidence, based on his experience and interactions with claimants in this case and other class action proceedings in Australia, that the registration process, including the prospect of individual group member identification, will deter otherwise interested and willing group members from registering their interest to participate in any potential settlement of a class action proceeding. This is due to group members’ existing commercial relationships with the respondents and the reputational risk that may occur if they were known to take adversarial positions to the respondent banks in active litigation.

Now although Mr Lange’s evidence comprises generalised statements, it is said that those statements represent opinions based on his substantial experience.

The applicant says that it follows from the evidence of Ms Nishimura and Mr Lange that group members’ interests do stand to be prejudiced by the proposed class closure orders. It is said that prejudice to group members arises in several ways.

First, it is said that there is the potential exclusion from any eventual settlement of a proportion of group members, including institutions with potentially large claims.

Second, it is said that there is the prospect that any settlement discussions will not be productive in circumstances where the legal representatives for the applicant apprehend that the registration process has, due to the “chilling effect” predicted by Mr Lange’s evidence, yielded an unrealistically small claim pool.

Third, it is said that even if an in-principle settlement is reached, there is the risk that there will be a flurry of applicants for late registration following any settlement, which may result in compensation available to those who registered through the class closure process being diluted.

Fourth, it is said that the class closure orders proposed will likely affect a significant number of qualifying group members who are not directly notified.

Fifth, it is said that to the extent that the respondents suggest that there is no real difference between registration now and registration following settlement, there is likely to be greater publicity and greater interest in registration following settlement.

63    I rejected these arguments in the following terms (at [146], [147], [149] to [158] and [161]):

Now I have taken into account the applicant’s evidence and concerns. But they are overstated to a large extent, and in any event do not carry the day.

First, the prospect in this case of distributing monies to group members from any approved settlement without a registration process is remote. The same features of the group definition which make it impossible for the respondents to ascertain the identity of all group members, including their own customers, would also make it impossible to identify group members to whom settlement monies should be distributed. Thus, the real effect of the proposed orders with respect to registration (apart from improving the prospects of a successful mediation) is to bring forward the timing of a registration process that inevitably would need to take place in the event of a settlement.

…

Second, the applicant contends that group members will be discouraged from registering now. This appears to be based on a theory advanced by Mr Lange at FRT, which is a firm that helps institutional investors identify eligibility, file claims and collect funds in class actions. The existence of a firm such as FRT reveals the sophisticated assistance which has developed to help group members identify and participate in class actions, including obtaining the relevant data. Accordingly, Mr Lange does not appear to suggest that group members would not register in this proceeding because they would be unaware of the process. Instead, he suggests that some may not register because of “the risks of registration”. It appears that these risks are the potential impairment of current or future relationships with the respondents or “criticism in the press and by those in the business community hostile to class actions”.

But the suggestion that an institutional investor who registers as a group member would have its relationship with the respondents impaired is an unsubstantiated contention. There is no proper basis to suggest that registration in this proceeding would cause the client service teams of the respondents to treat any registrant any differently than if they had not registered. Among other reasons, each of the respondents operates in competitive markets where they have a number of competitors who are not respondents. Further, the suggestion that a registrant would be the subject of media or other criticism is not supported by a single example.

Moreover, to the extent that any group member represented by FRT perceives such risks, it is plain that FRT’s clients are highly sophisticated entities. If, for example, a sovereign wealth fund represented by FRT decided not to register in this proceeding, then it can be safely assumed that it did so for its own sound commercial reasons. The fact that such an institutional investor may make that calculation in its own interest does not mean that the registration process is somehow unfair for the respondents and for group members who do choose to register, particularly given the benefits in terms of the possibility of an early resolution that comes from the facilitation of an effective mediation at this point in the proceeding.

Further, to the extent that group members are discouraged from registering by reason of a risk that the respondents or the media will be hostile to them, then that is a risk that remains present at the time of the registration process that would inevitably have to occur after any settlement sum was agreed.

I have to say that I found this so-called chilling effect argument underwhelming.

First, I am concerned with what is in the interests of all group members rather than just the interests of the few. And in my view the interests of all group members justify the orders sought in terms of opt-out and registration now.

Second, if some group members are so concerned about registering now, then they can opt out of the proceeding.

Third, the price of registering at this stage is a reasonable price to pay in order to obtain the potential fruits of any settlement. But in any event, this is not necessarily a “once and for all” occasion.

Further, in terms of the quantification of this risk and the impact on registration, the high watermark of Mr Lange’s evidence appears to be where he states that, even with those risks, “some” of his clients would register while “others considered it likely” that “at least some … boards would choose not to register given the risks”. He makes no effort to quantify the number of clients who will register and the number who will not. He says that some would be “discouraged” from registering, but does not say that they will not do so.

But why, as Ms Wendy Harris KC for UBS put it, should the interests of the few trump the interests of the many?

…

Further, to the extent it is said that the announcement of a settlement may cause additional group members to register having regard to Ms Nishimura’s experience in the Woolworths and Crown class actions, those cases were different from the present one. Unlike those cases, the present proceedings follow extensive litigation in various jurisdictions in which settlements have already been reached. By definition, group members are likely to be relatively sophisticated given the minimum transaction volume of AUD500,000. Indeed, Mr Lange’s evidence tends to confirm the relative sophistication of group members.

64    Indeed, if I had a choice and a party had sought it, I would have given serious consideration to a hard class closure order given the nature of the group members who after all could be taken to be sophisticated investors given that each group member had to have bought and/or sold currency during the relevant period to a value which equalled or exceeded the minimum transaction volume being the equivalent of AUD 500,000 to be within the group membership description.

65    Now in Wetdal Pty Ltd v Estia Health Limited [2021] FCA 475 at [68] to [70], [73] and [75] to [83], I said the following:

Section 33ZF(1) has been the source of power by which the Federal Court has regularly made class closure and registration orders. For example, it was the basis of the Full Court’s decision endorsing such orders in Melbourne City Investments Pty Ltd v Treasury Wine Estates (2017) 252 FCR 1 at [74] and [75] per Jagot, Yates and Murphy JJ, being an order of the kind made in the present proceeding by the March 2020 orders.

But in the wake of BMW, a challenge was made to the making of such orders under the cognate s 183 of the Civil Procedure Act 2005 (NSW). That question was referred to the NSW Court of Appeal in Haselhurst v Toyota Motor Corporation Australia Ltd (2020) 101 NSWLR 890, where the Court answered the question in the negative on 22 April 2020, on the basis that the order in that case effected a contingent extinguishment of group members’ choses in action and so could not be said to be necessary or appropriate to ensure that justice was done in the proceeding.

Subsequently, there was a further decision of the NSW Court of Appeal in Wigmans v AMP Ltd (2020) 102 NSWLR 199, where Haselhurst was fortified. In Wigmans there was lukewarm acceptance of what I had said in Newstart 123 Pty Ltd v Billabong International (2016) 343 ALR 662 …

…

By reason of BMW, Haselhurst determined that the barring order made as part of the class closure orders in that case was beyond power under s 183. The Court found that the purpose and effect of the order at issue (order 16) was to effect a contingent extinguishment of unregistered group members’ rights of action against the respondents. The Court said that an order which destroyed a person’s cause of action within the limitation period, without a hearing and with no guarantee that the person would necessarily know of the outcome or consequence of their failure to register, was not an order that was “necessary to ensure that justice is done in the proceedings” or “appropriate ... to ensure that justice is done in the proceedings”. It was found that s 183 was not a source of power to extinguish group members’ rights before settlement of the proceedings or a judgment in the proceedings. But these observations were all in the context of the Court analysing the particular order before it.

…

Now the order impugned in Haselhurst, which was said to effect an impermissible extinguishment of the claims of group members, is quite different to the March 2020 orders made by the docket judge in the present case. …

There are two significant differences between the March 2020 orders in this case, and the orders in Haselhurst.

First, the March 2020 orders do not use the language of extinguishment or “barring”, but rather are expressed in terms of a group member not being “permitted to seek any benefit pursuant to any settlement (subject to Court approval)”. So, the orders are expressly in anticipation of the exercise of power that must occur at the s 33V stage, where the Court must consider whether it is just to distribute the settlement only to those who have manifested an interest by registering.

Second, the March 2020 orders are expressly conditioned by the words “without leave of the Court”, to indicate that the question as to whether unregistered group members ought receive a distribution is a question that the Court will need to consider in future. Of course, that would be at the time of the later s 33V application.

So, the March 2020 orders are not orders which effect an extinguishment of group member claims, contingently or otherwise. The true position is that the claims of group members would not be extinguished until such time as the settlement was approved under s 33V and those claims merged in the settlement as approved by judgment of the Court, with the otherwise consequent dismissal of the claims. This would then be made binding on them under s 33ZB. It may be noted that at that point, which follows group members being afforded an opportunity to be heard, what is occurring is that the Court is making an order under s 33V. The fact that unregistered group members’ rights merge in the settlement and consequent dismissal without them receiving anything is no more than the consequence of the exercise of power under s 33V with respect to a just distribution of the settlement.

In my view, the construction adopted by the Court of the particular orders before it in Haselhurst does not apply in the present case. The decision is readily distinguishable for that important reason alone.

But I would venture to also observe, with respect, the following.

First, an order of the kind under consideration, as was made by the docket judge, does not effect a contingent extinguishment of group member choses in action at all. Indeed, the notion of a contingent extinguishment is to my mind problematic in any event. If there is a contingency, nothing has been extinguished. But there is more. If that contingency is expressed in an interlocutory order, which is susceptible to variation, it is unclear how anything could be said to be extinguished if the contingency itself may be redefined or removed by a later and final order.

Second, BMW was directed to a different problem, where the purpose of the early common fund order was said to be to ensure the economic viability of a proceeding and to put it on a stable foundation so that it could go ahead. It was said that such a purpose was extraneous to dealing with the substantive rights of group members in the proceeding. Now I might say that in many cases where early common fund orders have been made, that was not the purpose. But in any event, a class closure order is not in the same category. Its purpose is not extraneous to dealing with the substantive rights of group members in the proceeding. Indeed, the opposite. Its very focus is on how those substantive rights are to be adjusted inter se in the event that the proceeding settles.

66    It will be apparent that I was sceptical of the approach in Haselhurst v Toyota Motor Corporation Australia Ltd (2020) 101 NSWLR 890 concerning hard closure orders.

67    But interestingly, in Lendlease Corporation Ltd v Pallas (2025) 423 ALR 23, Gageler CJ, Gleeson and Jagot JJ said at [42]:

Further, it is one thing to conclude that a supplementary or gap-filling provision such as s 183 of the CPA does not enable the Supreme Court to make an order, before settlement negotiations, contingently extinguishing the rights of group members who have neither opted out nor registered their participation in a representative proceeding (as in Haselhurst). The making of such an order before a hearing to approve any settlement is readily able to be characterised as impermissibly usurping the capacity of the Court subsequently, at a hearing for the approval of any settlement, to perform the function which s 173(2) requires, namely for the Court to make “such orders as are just with respect to the distribution of any money”. The making of such an order is therefore impermissible because it denies the Court the subsequent capacity, at the hearing for the approval of any settlement, to discharge its functions in accordance with s 173(2)…

68    Now of course the question of hard class closure mechanisms was not before the Court in Lendlease, but clearly this dicta by three of its members has chilled the possibility of such a mechanism being further pursued for the moment.

69    Indeed the present state of affairs suggests that potential federal legislative reform may need to be considered perhaps along the lines of s 33ZG of the Supreme Court Act 1986 (Vic) which travels well beyond soft class closure mechanisms and provides:

Order may specify a date by which group members must take a step

Without limiting the operation of section 33ZF, an order made under that section may—

(a)    set out a step that group members or a specified class of group members must take to be entitled to—

(i)    any relief under section 33Z; or

(ii)    any payment out of a fund constituted under section 33ZA; or

(iii)    obtain any other benefit arising out of the proceeding—

irrespective of whether the Court has made a decision on liability or there has been an admission by the defendant on liability;

(b)    specify a date after which, if the step referred to in paragraph (a) has not been taken by a group member to whom the order applies, the group member is not entitled to any relief or payment or to obtain any other benefit referred to in that paragraph.

70    Anyway, that is a matter for the legislature. Let me return to elements of the settlement which I have approved.

Fairness and reasonableness inter partes

71    Now I am satisfied that the settlement amount of $59 million is fair and reasonable on an inter partes basis, particularly in light of the confidential opinion of senior counsel. Nothing further need be said here.

Fairness and reasonableness inter se

72    Further, in my view the settlement is fair and reasonable as between the group members inter se. Let me specifically address two aspects that bear upon an assessment of fairness and reasonableness from this perspective.

Settlement Distribution Scheme

73    In my view the proposed settlement distribution scheme is fair and reasonable. Let me make four points.

74    First, there is a reasonable rationale for the discounts proposed to registered qualifying trades. The discounts proposed to be applied are intended to reflect the risks associated with the group members’ claims, and to provide a basis for assessing a claim in circumstances where there is uncertainty as to what proportion of submitted trades meets the definition of qualifying trades. These discounts are in relation to the eligibility of the FX instrument, whether the relevant trades meet the requisite jurisdictional nexus and/or have been released in overseas proceedings, and whether the trade has been made by an algorithmic trader acting as a market-maker.

75    Second, the distribution process strikes an appropriate balance between ensuring that registered group members are provided with ample opportunity to be paid their entitlements under the proposed settlement whilst at the same time promoting efficiency and timeliness.

76    Third, the proposal to include fast-track options for two categories of group members who are assessed as being eligible for small payments out of the settlement fund is aimed at increasing efficiency and speed and minimising administration costs.

77    Fourth, the scheme provides for a right of review by the administrator who has the discretion to appoint an external reviewer. This approach strikes an appropriate balance between ensuring that registered group members can have the benefit of a review whilst minimising administration costs and delay.

Late registrants

78    Now there were 12 group members who sought to register late to participate in the proposed settlement. Of those 12 group members, 10 sought to register within 10 days following the registration deadline. The other two registrations were received by 30 November 2024, before the commencement of the initial mediation.

79    Two of the 12 late registrants have filed objection forms. They are the State of South Australia and Iowa Public Employees’ Retirement System (IPERS). These late registrants have not objected to the substance of the proposed settlement but rather have sought to be permitted to participate in the settlement. Now pursuant to s 33E(2), the State of SA was not a group member in the proceeding unless it gave written consent to being so. It filed a “Notice of Consent to be a Group Member” on 13 August 2024, and subsequently submitted a registration form on 14 August 2024, two days after the deadline. Now whilst complexities might be said to arise with respect to the suspension of the limitation period in relation to the State of SA as a consequence of it not consenting to being a group member until August 2024, in my view allowing it to participate in the settlement would not unfairly prejudice the interests of the registered group members given the amount that it is likely to receive from the settlement sum if allowed to participate. Similarly, IPERS only stands to receive a modest amount from the settlement sum if permitted to participate in the settlement.

80    Overall, the late registrants’ claims are worth less than 1% of the registered trade volume.

81    In those circumstances, I made an order that this small cohort of late registrants be treated as registered group members and be permitted to participate in the settlement. But I have unsurprisingly rejected the Bot registrants for reasons apparent from the label.

Proposed deductions from the settlement sum

82    I have the power under s 33V(2) to approve just deductions from the settlement sum, which I have done. Let me elaborate.

Legal Costs

83    Now this is not a case where there was third-party litigation funding, but it was a case where the applicant’s solicitors commendably carried the case on a no win no fee basis, and therefore in substance funded the proceeding.

84    The evidence shows that the scope of work performed on behalf of the applicant and the group members has been substantial. And the amount proposed to be deducted on account of legal costs is also large.

85    Now I have before me detailed evidence of the work performed by the applicant’s solicitors over more than six years, which includes the review of complex and voluminous discovery, engagement with industry experts to translate and comprehend a large body of chat transcript records, and engagement with experts in several different disciplines for the purposes of advancing the applicant’s case on giving effect to the impugned understandings, and the causation, loss and damage aspects of the case.

86    I appointed Mr Ian Ramsey-Stewart to prepare a costs referee report containing his opinion on the reasonableness of the applicant’s legal costs and disbursements incurred in relation to the proceeding. Legal costs and disbursements are addressed in the costs referee report in detail, and the costs referee has expressed the view that the fair and reasonable amount of costs, disbursements and deductions, including ATE insurance premiums, up to and including the settlement approval hearing was between $33,918,138.61 and $34,720,213.49. The costs referee also considered proportionality in his report by reference to the scope and nature of the claims and made reference to what I said in Foley v Gay [2016] FCA 273 at [23] and [24].

87    Now what is proposed to be deducted is the amount representing the bottom of that range, namely $33,918,138.61. Of that amount, $13,718,534.95 is referable to disbursements carried by Maurice Blackburn, much of which relates to the singularly large number of experts needed to be retained to advance the applicant’s case.

88    Of course, although the amount proposed to be deducted on account of legal costs and disbursements is undoubtedly a large amount, the amount of work performed, its cost and the proportionality of that cost must be assessed without using a hindsight lens. As I said in Blairgowrie Trading Ltd v Allco Finance Group Ltd (Receivers & Managers Appointed) (in liq) (No 3) (2017) 343 ALR 476 at [181] and [183]:

But what is claimed for legal costs should not be disproportionate to the nature of the context, the litigation involved and the expected benefit. The Court should not approve an amount that is disproportionate. But such an assessment cannot be made on the simplistic basis that the costs claimed are high in absolute dollar terms or high as a percentage of the total recovery. In the latter case, spending $0.50 to recover an expected $1.00 may be proportionate if it is necessary to spend the $0.50. In the former case, the absolute dollar amount as a free-standing figure is an irrelevant metric. The question is to compare it with the benefit sought to be gained from the litigation. Moreover, one should be careful not to use hindsight bias. The question is the benefit reasonably expected to be achieved, not the benefit actually achieved. Proportionality looks to the expected realistic return at the time the work being charged for was performed, not the known return at a time remote from when the work was performed; at the later time, circumstances may have changed to alter the calculus, but that would not deny that the work performed and its cost was proportionate at the time it was performed. Perhaps the costs claimed can be compared with the known return, but such a comparison ought not to be confused with a true proportionality analysis. Nevertheless, any disparity with the known return may invite the question whether the costs were disproportionate, but would not sufficiently answer that question.

…

Now it may be suggested that the concept of avoiding hindsight bias has no part to play in considering the “fairness” of the legal costs. The concept of “fairness” is the overarching theme for judicial approval of settlements under s 33V, albeit not the statutory language as such. But fairness is a broad concept. And the integers feeding into that overall assessment need to be assessed, qualitatively and quantitatively, and then balanced overall to consider whether the settlement and net recoveries to group members are fair. But let me assume for the moment that each integer of the settlement needs to be “fair” to group members (as distinct from some only being “fair”, but nevertheless the overall settlement being “fair”). And let me assume for the moment that one is addressing one integer, being legal costs, and its fairness. Feeding into the question of fairness of legal costs are many factors. It is difficult to see why you would not consider the fairness and reasonableness of the work at the time it was performed and in the context of the returns then expected. It is difficult to see why the applicant or group member would perceive that to be anything other than fair. No doubt the actual outcome of a case may also feed into the question of fairness. But in a case where the applicant and lawyer are not co-venturers, and with contingency fees not being allowed under the Australian model, it is difficult to see why the lawyer’s fees should be artificially taxed down by the actual outcome; the actual outcome is a risk borne by the applicant and group members (and the litigation funder if there is one), but not the independent lawyer who is not sharing in the returns of the enterprise.

89    Now what occurred in this case was that the bulk of costs were expended at a time where the applicant was conducting the open class proceeding for the benefit of all group members in that open class. And the claims of the open class were on their face very large.

90    But the respondents sought and obtained soft class closure orders for the purpose of mediation, which the applicant opposed, as I have said (J Wisbey v UBS (No 2)). And I accept that the registration process had the effect of significantly reducing the quantum of the claim which could realistically be sought at a mediation of the proceeding to a smaller percentage of the claim value of the open class. But I also accept that the costs were incurred proportionately by reference to the benefit reasonably expected to be achieved, and were necessarily incurred in order to prosecute a claim which was at the upper level of legal and technical complexity, and which was at all times resisted by the respondents.

91    In all the circumstances I allowed $33,918,138.61, being the bottom of the range of reasonable costs, disbursements and deductions assessed by the costs referee.

92    Moreover, it should be noted that with this costs deduction, the registered group members will be receiving approximately 44% of the total settlement sum, accounting for interest earned on the settlement sum.

ATE insurance premiums

93    Now the proposed deduction of $33,918,138.61 includes $3,047,800 in ATE insurance premiums paid by Maurice Blackburn during the proceeding. The insurance premiums were paid in respect of an adverse costs policy, the terms of which seemed reasonable in the circumstances.

94    Further, the insurance premiums were paid in circumstances as I have said where Maurice Blackburn conducted this proceeding on behalf of the applicant and the group members on a no win no fee basis and obtained ATE insurance for the benefit of the proceeding. Moreover, Maurice Blackburn’s intention to seek to recoup the costs of ATE insurance was made clear in its retainer and costs agreement with the applicant.

95    As O’Bryan J relevantly said in Kemp v Westpac (No 4) [2023] FCA 830 at [91]:

… An adverse costs order is a material risk faced by the representative applicant and the applicant’s solicitors. The acquisition of ATE insurance to mitigate that risk is a reasonable step to be taken by the applicant and the applicant’s solicitors. The solicitors ought to be permitted to recover the costs of an ATE insurance policy if the Court is satisfied that the costs are reasonable and that the costs are not otherwise being recovered through the solicitors’ success fee. The costs would be assessed as reasonable if the terms of the policy are appropriate in the context of the proceeding and the premium charged for the policy has been determined in a competitive market setting. …

96    Further, the fact that the proceeding was unfunded in the sense of there being no third party funder distinguishes it from cases where the payment of insurance premiums has been characterised as forming part of the management of the risk assumed by a third party funder, where questions of potential duplication come into play where both an ATE premium and funding commission in favour of a third party funder are sought. Of course that is not the present case.

97    Further, it would seem that I am not able to make a solicitors CFO to provide a separate allowance for the funding risk and cost assumed by the solicitors. If I had been allowed to do so I may not have allowed part of the ATE premiums as a deduction.

98    In the circumstances, I have allowed the deduction of ATE insurance premiums from the settlement sum.

Settlement distribution scheme administrator and administration costs

99    Further, in my view it is appropriate that the settlement distribution scheme be administered by Maurice Blackburn given Maurice Blackburn’s extensive involvement in dealing with group members in this case, Ms Nishimura’s experience in settlement administration and the relatively modest amount that Maurice Blackburn seeks in administration costs.

100    As to administration costs, the costs referee has assessed Maurice Blackburn’s estimate of administration costs if it is appointed as the settlement administrator, and has expressed the view that the amount of $345,493.93 to $380,043.32 inclusive of GST would be fair and reasonable. I will allow Maurice Blackburn fair and reasonable administration costs up to the amounts assessed by the costs referee.

Applicant’s reimbursement payment

101    Further, it is appropriate that the applicant receive a reimbursement payment of $74,850.28. Ms Nishimura has addressed the basis for this claimed amount in her affidavit. Moreover, these costs are assessed in the costs referee report as being reasonable.

102    In my view the proposed payment is justified, having regard to the work performed by the applicant for the benefit of the group members, the complexity and duration of the proceeding and the reimbursement amounts that have been awarded in other cases, albeit that the amount is at the upper end of the range for allowable payments of this type according to the data analysed by Professor Vince Morabito, whatever central tendency metric that one uses, viz, mean, median or mode.

Conclusion

103    For the foregoing reasons I approved the settlement under s 33V(1) and made the necessary allocation orders under s 33V(2).

Associate:

Dated:    26 August 2025

SCHEDULE OF PARTIES