On 6 August 2010, the Hon. John Hatzistergos MLC, Attorney General and Minister for Industrial Relations, announced a proposal to reform class action laws in New South Wales (NSW). According to the Attorney General, the reforms (which received preliminary support from Cabinet) seek to eliminate the lack of clarity in the current system which he believes does not 'provide clear guidelines as to who may commence a class action, in what circumstances and other issues such as settlement of proceedings, costs and appeals'.1 The proposed reforms, modelled on already existing laws in the Federal and Victorian jurisdictions, will eliminate uncertainty whilst promoting a uniform system to minimise confusion for litigants.2

Whilst the Attorney General has not outlined the specific changes to the current regime, he has indicated that NSW will make improvements as recommended by the Victorian Law Reform Commission's 2008 Civil Justice Review and the Commonwealth Attorney-General's Department's 2009 Access to Justice Report. Major recommendations and implications are as follows:

  • the removal of the requirement that all class members must have a claim against all defendants as established in Philip Morris (Australia) Ltd v Nixon (2000) 170 ALR 487. Adoption of this recommendation would promote greater flexibility and allow for groups of related claims to be dealt with in concert.3
  • the adoption of a cy-press-like remedy to distribute unclaimed damages to a charity rather than be retained by the respondent. This would ensure that 'funds are being put to their next best use, rather than being returned to the party or company that was sued in the class action'.4
  • the requirement that those who participate in a class action consent to the conduct of proceedings on their behalf.5 This would enable the 'settlement of claims by some members of a (funded) class while the class action continues'.6

The adoption of a uniform system in NSW is likely to promote the state as a viable alternative to regimes in other states and territories in Australia. As a result, it is likely that the number of class actions in NSW will increase upon the adoption of the proposed reforms.

A draft Bill and discussion paper is expected to be released later this year for public consultation.

1 The Hon. John Hatzistergos MLC 'NSW Set to Reform Class Action Laws' (Media Release, 6 August 2010).
2 The Hon. John Hatzistergos MLC 'NSW Set to Reform Class Action Laws' (Media Release, 6 August 2010).
3 Commonwealth Attorney-General Department Access to Justice Report (2009), 115.
4 The Hon. John Hatzistergos MLC 'NSW Set to Reform Class Action Laws' (Media Release, 6 August 2010).
5 Victorian Law Reform Commission Civil Justice Review (2008), 38.
6 Commonwealth Attorney-General Department Access to Justice Report (2009), 115.

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