Background
FZR24 was held in immigration detention at Woomera from 2001 to 2003 and at Baxter from 2003 to 2005. He and other former detainees brought claims alleging negligence and intentional torts against the Commonwealth arising from their detention. The Commonwealth had operated the centres through contractors including Australasian Correctional Services and G4S.
After numerous individual claims were transferred from South Australian courts, FZR24 commenced a representative proceeding in the Federal Court and 37 related individual proceedings were stayed. The parties settled after mediation, subject to Court approval. The Commonwealth agreed to pay $28.21 million under a settlement distribution scheme.
The Court’s Holding
Justice O’Sullivan approved the settlement under s 33V(1) of the Federal Court of Australia Act 1976 (Cth). The Court held that it was within the range of reasonable outcomes: the claims were factually complex, trial would involve substantial further cost, and settlement gave the parties and group members certainty and finality after claims that had in some cases been pending since 2012.
The Court also approved $11,172,367.25 in deductions, including legal costs from the representative and earlier transferred proceedings, disbursement-funding costs, the costs assessor’s fee, a $20,000 reimbursement to the lead applicant, and $75,000 for administration. The Court accepted the costs assessor’s conclusion that the costs were reasonable and noted that group members had received estimated net-distribution figures without objection. Shine Lawyers was appointed administrator. The Court refused the Commonwealth’s application to continue suppressing settlement material, holding that open justice required the confidentiality orders to be discharged.
Key Takeaways
- The Court approved a $28.21 million settlement of former Woomera and Baxter detainees’ claims.
- Costs and other approved deductions totalled about $11.17 million.
- Potential effects on the Commonwealth’s negotiations in other cases did not justify continuing suppression of settlement material.
Why It Matters
The decision illustrates the Federal Court’s protective role in approving representative-proceeding settlements and deductions from group members’ recoveries. It confirms that substantial costs may be approved where justified by the litigation’s complexity, expected benefit and independent costs assessment.
It also reinforces that settlement approval in a class action is ordinarily subject to open justice. A respondent’s concern that disclosure could affect negotiations in related litigation will not, without more, displace that principle.