Endeavour River Pty Ltd v MG Responsible Entity Limited (No 2) [2020] FCA 968

Endeavour River Pty Ltd v MG Responsible Entity Limited (No 2) [2020] FCA 968

A 25% funding commission on the gross settlement—amounting to $10.5 million—is within the range of fair and reasonable in the circumstances, taking into account risks, return, and class member interests. All other deductions and settlement terms are also fair and reasonable. The Court may approve this under s 33V, despite pre-existing funding agreements at higher rates, where a higher commission would yield excessive or disproportionate profit relative to risk undertaken.

Jurisdiction
Australia
Judgment Date
09 July 2020
Procedural Posture
Representative Proceedings (class Action) / Settlement Approval Under S 33 V, Resolution of Reasonableness of Litigation Funding Commission
Outcome
Settlement approved under s 33V of the Federal Court of Australia Act 1976 (Cth); funding commission rate fixed at 25%; orders made for distributions and confidentiality; further orders reserved for distribution completion.
Legal Topics
['litigation Funding' 'settlement Approval' 'continuous Disclosure Obligations' 'misleading or Deceptive Conduct']
['class Actions' 'commercial Law' 'corporate Law'] ['litigation Funding' 'settlement Approval' 'continuous Disclosure Obligations' 'misleading or Deceptive Conduct']

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Procedural Posture

Representative Proceedings (class Action) / Settlement Approval Under S 33 V, Resolution of Reasonableness of Litigation Funding Commission

Legal Issues

  1. 1 ['Whether the proposed litigation funding commission is fair and reasonable under s 33V of the Federal Court of Australia Act 1976 (Cth)' 'Whether settlement terms and distribution deductions are fair and reasonable']

Ratio Decidendi

A 25% funding commission on the gross settlement—amounting to $10.5 million—is within the range of fair and reasonable in the circumstances, taking into account risks, return, and class member interests. All other deductions and settlement terms are also fair and reasonable. The Court may approve this under s 33V, despite pre-existing funding agreements at higher rates, where a higher commission would yield excessive or disproportionate profit relative to risk undertaken.

Court Disposition

Settlement approved under s 33V of the Federal Court of Australia Act 1976 (Cth); funding commission rate fixed at 25%; orders made for distributions and confidentiality; further orders reserved for distribution completion.

Orders

  • ['Order for various affidavits and exhibits to be treated as confidential per Federal Court of Australia Act ss 37AF, 37AG(1)(a).' 'Settlement of the proceeding upon terms of the settlement agreement approved under s 33V.' 'Settlement Distribution Scheme approved; appointment of Administrator.' "Approval of...