In Australia’s changing regulatory regime, class actions are an ever-increasing risk for companies and on the rise in a number of areas, including consumer and government space.
We expect there will be more entrants to the plaintiff class action market as contingency fees incentivise larger commercial firms, who traditionally acted for defendants, to take on plaintiff briefs. We also anticipate directors and officers will be more regularly joined to securities class actions against small to mid-cap ASX-listed entities. In recent years there has also been an increase in the number of class actions in non-financial areas including, consumer, environment and workplace.
Class action defence
In response to this dynamic, W+K has created a unique offering. Under this model, our class action defence work is run jointly by an insurance subject matter expert and a specialist class action litigation team. This approach offers the best of both worlds to insurers and insureds in class actions in all areas, including financial collapses, personal injuries, workplace, natural disasters, environmental liability, intentional torts and product liability.
Our class actions team have extensive experience gained from working at some of the largest defence firms in Australia across a range of industries and sectors. Prior to joining the firm, they worked on some of the largest and complex class action claims in recent years.
Class action coverage and monitoring
W+K is the law firm of choice for providing coverage advice to insurers and monitoring class actions brought against blue-chip companies, statutory agencies and corporate executives.
Amanda Beattie
Head of Class Actions, Sydney
P: +61 2 9064 1897
E: amanda.beattie@wottonkearney.com.au
Recent work
W+K is acting on behalf of South Australian Power Network (SAPN) in the defence of a class action commenced on behalf 800 parties that suffered property damage and personal injury following a bushfire that occurred in the Adelaide Hills in December 2019.
It is alleged that the distributor of electricity, SAPN, was negligent in the way in which it responded to the fall of a tree onto the line that caused the outbreak of the fire. The case raises unusual issues from a bushfire perspective associated with the systems that cut the electricity after a fault is detected, which, it is alleged, were inadequate and which, it is said, if operative would have avoided the fire.
W+K handled three class actions against energy company Powercor arising from the 2009 Victorian bushfires. Following extensive individual negotiations, we successfully reached settlement with over 400 plaintiffs, each with individual claims.
We also acted in four class actions involving multiple property damage claims arising from the 2018 Victorian bushfires as a result of electrical fires caused by alleged defects in a power company’s network.
W+K took over conduct of the Parkerville Bushfire litigation following the first instance judgment. The fire arose out of a power pole falling over and causing a bushfire, which resulted in claims against Western Power, Thiess (W+K’s client) and the landowner, Mrs Campbell. Proceedings were commenced on behalf of 120 parties by Slater & Gordon, which were supplemented by separate actions on behalf of subrogated underwriters. These, in turn, totalled 200 individual claims, as there was no class action procedure in Western Australia at the time.
The Court of Appeal reduced the measure of damages against Thiess from 70% to 35% and held Western Power liable for 50% of damages. Western Power successfully obtained leave to appeal to the High Court on the issue of whether Western Power owed a duty of care to the claimants as, while the pole that collapsed belonged to the landowner, Western Power had attached its conductors to the pole to deliver electricity to the landowner. This was the first time that the High Court had considered a bushfire liability. The High Court found a duty of care on the part of Western Power to maintain Mrs Campbell’s pole because it used the pole to deliver electricity.
W+K is acting for Halifax Vogel Group Pty Ltd (HVG) in cladding class action proceedings brought by an Applicant and Group Members against cladding manufacturer 3A Composites and supplier HVG in the Federal Court of Australia.
HVG is the importer/local distributor of well-known products widely used across Australia in numerous building applications. The class action is brought against the manufacturer and HVG as the importer of Alucobond branded aluminium composite panels.
The case will address important issues relating to consumer protection laws, product liability, building standards, shared liability and product safety standards. It involves examination of legislative definitions and consumer protections regimes, the extent to which consumers and suppliers might both rely on third parties involved in design, approval and construction of buildings, as well as the application of a purposive, outcomes-based (rather than prescriptive) building code.
TFS manufactured and distributed a pelvic mesh device, called Tissue Fixation System, used to treat stress urinary incontinence (SUI) and pelvic organ prolapse (POP). This landmark product liability class action was brought against TFS and other manufacturers of pelvic mesh implants with a common designer, after the primary findings of Katzmann J in Gill v Ethicon Sarl (No 5) relating to Johnson & Johnson pelvic mesh devices. The TFS sub-group members alleged that:
- the TFS devices had a safety defect, were unfit for purpose and not of merchantable quality, in breach of consumer laws, and
- TFS negligently failed to undertake adequate clinical evaluations of the TFS devices before supply in Australia and failed to warn that alternative treatments were available for SUI/POP and/or that the TFS implants could cause complications.
We acted for TFS before its liquidation in formulating defence strategy, investigating the alleged complaints regarding the TFS devices, and researching matters relating to escalation of investigations into the removal of pelvic mesh devices from the Australian Register of Therapeutic Goods after the US FDA issued a Safety Communication regarding the use of mesh to treat SUI and POP in 2008.
Opal Tower is a residential building tower in Sydney’s southwest comprising 392 residential units, a childcare centre and a retail centre. Construction of Opal Tower was completed on 8 August 2018. On 24 December 2018, Opal Tower was evacuated after residents heard loud cracking noises in structural walls of the Opal Tower. The evacuation of Opal Tower received widespread media coverage, and led to the Department of Planning, Industry and Environment (DPIE) commissioning an independent investigation into the structural failures of the Opal Tower.
In July 2019, the plaintiffs (owners of a unit within Opal Tower) commenced representative proceedings on behalf of all unit owners in Opal Tower, against SOPA claiming damages for:
- the rectification of alleged defects, and
- diminution in value of lots within the Opal Tower.
The circumstances of the matter are unusual because SOPA, as the owner of the land that the Opal Tower was built on, is a ‘deemed developer’ under section 18C of the Home Building Act 1989 (NSW). The quantum of the plaintiffs’ claim totals in excess of $100m plus interest and costs.
The Owners Corporation has commenced a separate action for its unique losses, which are claimed to at $30m plus interest and costs.
We were engaged to act for SOPA in its defence of the class action proceedings. SOPA has subsequently filed cross-claims against the developer of Opal Tower (Australia Avenue Developments), the builder (Icon Co (NSW) Pty Ltd) and the engineers (WSP).
W+K is instructed by the excess insurers of Transport for NSW, Acciona Infrastructure Australia (and related project entities) regarding the Sydney Light Rail Class Actions.
The excess insurers sit on the insurance programme from $50m to $400m in a class action reported in the media to relate to 110 businesses seeking damages of $410 from interruption and nuisance caused by the construction of the Sydney CBD Light Rail.
We are advising the excess insurers on the extent to which coverage might be available under the policies, and whether that position differs from the coverage position adopted by the primary insurer.
Following the collapse of Providence Capital Limited in 2012, two separate class actions were commenced against the trustee, Australian Executor Trustees Limited. The proceedings were jointly managed in the NSW Supreme Court and as part of its defence the trustee commenced cross-claims against the auditors of Provident, including PwC, alleging negligence.
We were coverage counsel for the London market in one of the highest-profile securities class actions in Australian history, with allegations of alleged misleading conduct and market disclosure breaches.