The recent decision in Bogan v The Estate of Peter John Smedley (Deceased) [2025] HCA 7 may have hardened class actions filed in Victoria against transfer applications seeking to remove matters to non-GCO jurisdictions, with a possible impact on Defendant decision-making at the early stage of such actions.
Group costs orders (GCOs), which entitle law practices to be paid a contingency fee when they are otherwise barred from such payment, have been a major factor in increasing the popularity of filing class actions in Victoria over other state jurisdictions.
In August 2020, a class action was filed against the directors of Arrium Ltd (Arrium) and its auditor alleging, inter alia, contraventions of the Corporations Act. In February 2021, the plaintiffs applied for a GCO, shortly followed by a Defendant’s application pursuant to s1337H(2) of the Corporations Act to transfer the proceedings to the Supreme Court of New South Wales. The Supreme Court of Victoria decided that the GCO application be determined first (without opposition), and then made a GCO.
Subsequently, the transfer application was removed to the Victoria Court of Appeal to determine whether
(a) the GCO would remain effective upon transfer (i.e. whether it would travel with the claim),
(b) if not; whether the GCO was a relevant factor in determining the transfer application; and
(c) whether the proceedings should be transferred.
A 6-1 majority of the High Court, agreeing with the Victoria Court of Appeal, determined that the GCO would not “travel”, that the GCO was a relevant factor to the decision whether or not to transfer proceedings, and that the proceedings ought not be transferred. The majority’s decision on the second question held the importance of a GCO for plaintiffs’ ability to obtain access to justice was plainly relevant to the “interests of justice” in terms of deciding the transfer application and weight decisively against granting transfer.
The obvious consequence of the High Court’s decision is that, once a GCO is made in any Victorian class action, the probability of that proceeding being transferred to another jurisdiction becomes very unlikely, especially where there is evidence that the case will not be prosecuted in the absence of a GCO. The result will be that Defendants contemplating transfer applications will be forced to make such applications at an earlier stage to try to avoid a GCO becoming a factor in such an application, and may also elect to appeal any decision to make a GCO prior to deciding the transfer application. Where there are competing proceedings filed in alternative jurisdictions, Defendants may have an additional reason to proceed to transfer before carriage motions are determined. Going forward, class action plaintiffs will need to plan for these procedural outcomes when filing proceedings in Victoria.
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