Background
Darren and Rosaline Mitchell brought a representative proceeding for people whose land was compulsorily acquired for the WestConnex M4-M5 Link Project. They alleged that Transport for NSW acquired land contrary to s 179 of the Roads Act 1993 (NSW), including because the land was later leased to private entities for consideration.
The proceeding stalled after a dispute between the Mitchells and their litigation funder, Litigation Fund WCX Pty Ltd. The funder would not continue funding the case while the Mitchells remained representative plaintiffs, and the Mitchells could not finance the estimated $2–3 million cost of preparing it for trial. Efforts to secure a replacement funder failed, and a proposed substitution of another group member as representative plaintiff was withdrawn.
The Court’s Holding
Coleman J approved the discontinuance under s 173 of the Civil Procedure Act 2005 (NSW). The relevant question was whether discontinuance would be unfair, unreasonable, or adverse to group members’ interests—not whether it would harm the funder’s financial interests. The Court held that the Mitchells should not be compelled to continue an unfunded proceeding at their own risk.
Discontinuance did not extinguish group members’ rights to bring individual claims or a fresh representative proceeding. The Court accepted that the earliest relevant acquisition occurred in April 2019 and that the applicable limitation period was at least six years; because limitation periods had been suspended while the representative proceeding was on foot, more than four years remained for the earliest claims. The Court also ordered notice of the completed discontinuance to identified group members, made a clarifying declaration preserving their rights, and continued limited confidentiality orders for one year after the proceeding concluded.
Key Takeaways
- A representative proceeding may be discontinued where it is no longer funded and discontinuance does not materially prejudice group members.
- The Court’s supervisory role focuses on group members’ interests, rather than a funder’s contractual or commercial interests.
- Discontinuance returns group members to their ability to sue independently or commence a new class action, subject to limitation periods.
Why It Matters
The decision confirms that representative plaintiffs cannot ordinarily be required to carry an unfunded class action merely because a litigation funder opposes its discontinuance. It also illustrates the practical protection provided by statutory suspension of limitation periods while a representative proceeding is pending.
For class-action practitioners, the case shows that notice obligations on discontinuance are fact-sensitive: targeted post-discontinuance notice to identified, aware group members was sufficient on these unusual facts, rather than a costly campaign directed to the entire potential class.