What is a class action and why do they exist?
When large companies or institutions do the wrong thing and people are harmed or suffer loss as a result, an individual can have little to no means of bringing a legal claim.
A class action is a type of legal case where one person brings a claim on behalf of a wider group of people who have been affected by the same wrongdoing.
What criteria is required for a class action to take place?
There are three criteria that need to be fulfilled to start a class action:
There must be 7 or more people that have claims against the same defendant;
The claims relate to the same or similar circumstances; and
The claims must have common issues of fact or law.
What are the benefits of a class action?
Class actions are an important mechanism within Australia’s legal system that allow large groups of people to come together to pursue a claim collectively.
The benefits of class actions include:
There are no out-of-pocket expenses
They minimise the administrative and emotional burden involved in a regular legal case
They enable greater access to justice
How do class action lawsuits work?
Every class action is unique, however, the class action process will generally unfold in the following stages:
What does Opt-Out mean?
In Australia, class actions are run on an ‘opt-out’ basis. This means that even if group members don’t actively sign up to the class action, they are automatically included if they meet the eligibility criteria.
At a certain point in the case, the Judge will make orders that anyone who is eligible for the class action is notified of their right to opt-out of the class action.
How long do class actions take?
The time taken from case commencement, through to resolution and settlement administration depends on the particular case and the nature of the claim. It may take anywhere from two to several years for a class action to conclude.
How many people do you need for a class action?
To start a class action there must be 7 or more people that have claims against the same defendant.
The person who brings the class action is known as the ‘lead applicant’ or ‘lead plaintiff’. In some cases, there can be more than one lead applicant.
The wider group of people that are represented by the lead plaintiff are known as ‘group members’.
In our Helpful Guide to Class Actions we provide further information about what you can expect if you are the lead applicant/s or a group member in a class action.
How do class action settlements work?
When a class action settles, the settlement must be approved by the Court, including all deductions for legal and other expenses and a scheme for distribution of the settlement to group members.
Below we answer some common questions about class action settlements, but for further information on how this process works, see our Helpful Guide to Class Actions.
How are class action settlements distributed?
The amount of compensation will vary between group members, depending on the individual circumstances of each group member, and the harm or loss that has been suffered.
An administrator will be appointed to the settlement distribution scheme, who is in charge of implementing the terms of the settlement.
The administrator will assess how much compensation each group member is entitled to, then organise the payment to the group members as efficiently as possible.
The Court will continue to oversee this process to ensure the settlement distribution scheme is followed accurately and efficiently until completion.
Where can I find more information about the class action process?
As one of Australia’s largest class actions firms, we have proudly been at the forefront of some of the country’s most complex and challenging class actions, fighting to obtain justice for thousands of individuals.
Whether you’re considering registering for a class action or already have registered, we’re here to help. For further information about the class action process and what you can expect along the way, download your copy of A Helpful Guide to Class Actions below.