Steve Georganas (Adelaide, Australian Labor Party) Share this | Hansard source

by leave—Class actions are an important part of our judicial system. They enable victims of wrongdoing and negligence—and we've seen many cases over the years, whether it be asbestos related diseases, a whole range of things—to stand their ground against the vastly superior resources of large corporations and governments. Without class actions, such people simply wouldn't have the means to seek redress or compensation in the courts on their own. This is quite clear in evidence. When you speak to people who have gone through a class action and you speak to the funders and their lawyers and ask, 'If there were no class action, what recourse would you have had?' the answer is always, 'Zero.'

We found it bizarre that people would be wanting to change this legislation. We know that such claims can be costly for people that aren't part of a class action, and the plaintiffs may not be in a position to fund the actions themselves. Litigation funding schemes are therefore an important part of ensuring that class action is fair and equitable, and it has served us. It has served us in a good way so far. The question is how to prevent third-party litigation funders from claiming a disproportionate share of a successful action relative to their costs and risks. Understanding and resolving this question is the aim of the Corporations Amendment (Improving Outcomes for Litigation Funding Participants) Bill 2021. This is why the committee's inquiry into the bill was so important. It is vital that we get this right to ensure that we are not impeding people's access to justice, as this bill would see, but rather facilitating it. This bill and the inquiry process leave a lot to be desired. This bill is intended to protect the interests of plaintiffs in class actions, but, in actual fact, it does the exact opposite. By making it more difficult for people to bring class actions in the first place, the bill will protect the interests of powerful defendants.

How can we ignore the overwhelming evidence heard by the committee that this bill would leave class action plaintiffs and defendant significantly worse off? The committee was told repeatedly that the bill does nothing to resolve the current uncertainty in relation to the availability of common fund orders, as recommended by all members of this committee in December 2020. Instead, we were overwhelmingly told that the bill promotes uncertainty, that it promotes confusion around common fund orders, to the detriment of plaintiffs and defendants in class action. In addition, the bill requires class members to agree in writing to be members of a litigation funding scheme. This, the committee heard, would lead to an increase in the number of closed class actions and possibly also multiple class actions for a given event. Then, from evidence we received, there is a question mark over whether or not this bill is actually constitutional. Clearly this is a serious problem.

It is difficult to overstate the level of concern that has been expressed by submitters to this inquiry, and Labor members sincerely regret that we didn't have more time to enable us to do justice to these concerns in our dissenting report. This is because we were given less than one day to consider the majority report and respond to it. How can you do it justice? The entire process around the handling of this bill has been shambolic from the start. Members of the public were given less than a week to review a draft of this complex legislation and make a submission. Most of the feedback Treasury received from submitters was ignored, and the bill was introduced in late October. It was referred to a committee that was given less than three weeks to conduct its inquiry, and members of the public were given seven days to make a submission.

I'm sure that most people would agree that these are important, complex legal matters that we are talking about and that this rushed time frame is not exactly conducive to thorough debate and investigation. The impact of not getting this legislation right could be severe. Litigation funders and plaintiff law firms provided the committee with a list of examples of class actions that would not have proceeded, as I mentioned at the beginning of my statement, or at least would have been unlikely to proceed had the measures in this bill been in place. People can see the many examples that were submitted to us in attachment A of our dissenting report. I can assure you these are important actions that would have been impeded by this legislation. But no-one, let alone the proponents of this bill, has been able to explain why this would be a good thing.

Given these and numerous other problems raised in the dissenting report, Labor members have recommended that the bill not proceed in its current form and be withdrawn immediately. If, however, the government insists on proceeding with the bill, it should not do so until the bill has been subject to the proper inquiry process, whether by this committee or another parliamentary committee such as a Senate committee. Such an inquiry must also provide witnesses with sufficient time to respond to questions, which we didn't get in this report. In addition, the A-G's Department needs to comprehensively address in writing the concerns that were raised by Justin Gleeson and other legal experts about the constitutionality of the bill. That is a big question mark and a serious one. This bill should not go any further until those questions on the Constitution are answered.

The matters handled in this bill could have serious ramifications on citizens' access to justice. So it begs the question: just who is this bill aiming to protect? Is it the people or big corporations? As it stands, it's clear that if this bill goes through it will only protect big corporations. That is quite clear. It's also clear that it's the people who stand to lose the most if this government has its way and introduces this bill in its current form. That is why we have tabled a dissenting report.

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