TW McConnell Pty Ltd as trustee for the McConnell Superannuation Fund v SurfStitch Group Ltd (administrators appointed) (No 4); Nakali Pty Ltd v SurfStitch Group Ltd [2021] NSWSC 121

TW McConnell Pty Ltd as trustee for the McConnell Superannuation Fund v SurfStitch Group Ltd (administrators appointed) (No 4); Nakali Pty Ltd v SurfStitch Group Ltd [2021] NSWSC 121

Settlement is approved subject to a cap: the Funders' entitlement to commission and costs is not to exceed $6.5 million, in order to ensure fair outcome for all group members, avoid prejudice to late registrants, and keep total costs proportionate to the settlement pool. This is necessary due to complexities, prior...

Source-derived case information.

Parties
Plaintiff: TW McConnell Pty Ltd as trustee for the McConnell Superannuation Fund; Plaintiff: Nakali Pty Ltd; Defendant: SurfStitch Group Ltd (in administration); Defendant: Justin Peter Cameron; Defendant: Chubb Insurance Australia Ltd; Contradictor: G Donnellan with K Morris
Jurisdiction
Australia
Judgment Date
19 February 2021
Procedural Posture
Class Action/representative Proceedings / Settlement Approval Hearing
Outcome
Settlement approved with cap on Funders' commission and costs
Legal Topics
Representative Proceedings, Shareholder Class Actions, Settlement Approval, Costs and Funding Orders
Civil Procedure Corporations Equity Representative Proceedings Shareholder Class Actions Settlement Approval Costs and Funding Orders

Source-derived case record

Summary, issues, holding and outcome

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Parties

TW McConnell Pty Ltd as trustee for the McConnell Superannuation Fund

Plaintiff

Nakali Pty Ltd

Plaintiff

SurfStitch Group Ltd (in administration)

Defendant

Justin Peter Cameron

Defendant

Chubb Insurance Australia Ltd

Defendant

G Donnellan with K Morris

Contradictor

Procedural Posture

Class Action/representative Proceedings / Settlement Approval Hearing

Legal Issues

  1. 1 Whether the proposed settlement is fair and reasonable inter partes and inter se for group members
  2. 2 Whether costs and commissions claimed are proportionate and reasonable
  3. 3 Whether disentitling conduct by plaintiffs/legal advisers/funders should affect approval or costs

Ratio Decidendi

Settlement is approved subject to a cap: the Funders' entitlement to commission and costs is not to exceed $6.5 million, in order to ensure fair outcome for all group members, avoid prejudice to late registrants, and keep total costs proportionate to the settlement pool. This is necessary due to complexities, prior conduct, and the high proportion of costs to recovery, but overall settlement is the best available to group members given minimal prospects of further recovery.

Court Disposition

Settlement approved with cap on Funders' commission and costs

Orders

  • Settlement approved under s 173 Civil Procedure Act 2005 (NSW)
  • Funders' total entitlement to commission and costs capped at $6.5 million