Jurisdiction over class actions in Australia involving Federal law

Currently claimants may bring a securities class action, and any other class actions involving federal law, in the Federal Court of Australia or in one of the state courts with a class action regime, namely Victoria, New South Wales or Queensland. This has led, in some circumstances, to “competing” class actions being filed in both federal and state courts.

Jason said that, while he could see the benefits in a consistency of approach, he found it difficult to justify limiting class actions to one specific jurisdiction. Australia has a system of federal and state courts and they are all equipped to address the types of legal issues arising in all species of class actions. The Federal Court arguably has a deeper level of experience in class actions in respect of the number of claims filed in that jurisdiction compared to the state Supreme Courts. However, the Supreme Courts have also managed class action litigation, including some of the largest, non-shareholder claims in Australia, particularly in the product liability and mass tort space, and the judges there are deeply experienced as well.

Jason agreed that competing class actions spread across state and federal courts was not helpful. However, he did not think the problem was acute and the courts do have existing cooperation protocols in place where competing class actions are commenced in different jurisdictions. (At the time of filming this discussion, these protocols had yet to be deployed so he could not comment on their efficacy.) Jason did not see a powerful justification for having all of a particular type of class actions litigated in one jurisdiction.

Clive said he didn’t think all class actions should be litigated in the Federal Court. However, he could see the benefits of an increased chance of consistency in decision-making and the removal of the potential for competing actions being filed in different jurisdictions – the prospect of which may have increased with contingency fees being permitted in Victoria. 

Jason agreed that was a powerful point. Class actions are inherently a national practice – they affect Australians nationally. Therefore, uniformity, in terms of the interlocutory process, is an important goal. However, the courts have shown a remarkable ability to adapt to the particular requirements of a case, so even achieving consistency within one court can be challenging because of the differing needs of each case.

Clive added that, even though class actions in Australia have been in place for thirty years, the law in respect of securities class actions is still in its infancy and evolving. This creates a challenge for the courts because they need to grapple with a lot of new issues. Consequently, Clive considered there would be a benefit from uniformity of decision making.

Click above to view this film or see the video library on our website for other episodes of Clive and Jason’s discussion.