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Australian Law Reform Commission inquiry into class action proceedings and third-party litigation funders

Media Release

Acting Attorney-General
The Hon. Greg Hunt MP

The Australian Law Reform Commission's final report into class action proceedings and third-party litigation funders has been publicly released after being tabled in Federal Parliament.

The report is expected to stimulate debate amongst consumer advocates, the legal profession, the business sector, and across the wider community, on the issues raised by the report.

In announcing the review in December 2017, then Attorney-General, George Brandis, said that with class actions becoming more common in courts across Australia, the Government wanted to ensure the costs of such proceedings are appropriate and proportionate and that the interests of plaintiffs and class members are protected.

There is a significant risk, in such proceedings, that members of plaintiff groups may be required to pay lawyers' fees which are exorbitant and unjustifiable.

Unlike lawyers, third party funding entities are not bound by professional ethical obligations, despite playing a significant role in enabling and maintaining class action proceedings.

Third party litigation funders are not subject to any comprehensive Commonwealth or state and territory regulation to address the structure, operation and terms on which they participate in the Australian legal system.

The ALRC was specifically asked to consider whether and to what extent class action proceedings and third party litigation funders should be subject to Commonwealth regulation, with reference to specific matters that have arisen including the proportionality of lawyers' costs and the lack of ethical constraints on their operation such as those binding legal practitioners.

Now the ALRC's recommendations are publicly available the Government will further engage with key stakeholders in developing its response to the report, to ensure that the class actions regime provides just and effective outcomes for all Australians.

The report raises complex issues which will need thorough consideration and the Government will carefully consider each of the report's recommendations.

I thank the ALRC for its work on the report.

The report is available on the ALRC's website.