Game Changer: Appellate Court Permits Common Fund Orders In Australian Class Action Litigation

Key Points

• An upsurge in Australian class action filings is expected now that the Full Court of the Federal Court of Australia has permitted a common fund order in federal class action litigation.
• In what may prove to be one of the most significant rulings in Australian class action law, the Full Court in Money Max Int Pty Ltd (Trustee) v QBE Insurance Group Limited [2016] FCAFC 148 has, for the first time, made orders permitting a litigation funder to be paid a court-determined percentage from any fund created as a result of a successful class action settlement or judgment—i.e., a common fund order.
• Prior to this decision, litigation funders were compensated from the proceeds (be it a settlement or judgment) obtained by the subset of class members who had entered into a funding agreement with them. Now, all members of the class are likely to have to, in effect, contribute to the payment of a litigation funder's fee (whether or not they entered into a funding