Procedure for Damages Assessment in Class Action

The court determined the appropriate methodology and procedure for assessing damages in a representative proceeding involving over 850 individual claims, allowing the defendant to issue subpoenas and cross-examine claimants under certain conditions.

Supreme Court New South Wales

Medium Neutral Citation: [NAME] v [COMPANY] (No.5) [2023] NSWSC 392 Hearing dates: 08 December 2022 Date of orders: 26 April 2023 Decision date: 26 April 2023 Jurisdiction: Common Law Before: Garling J Decision: See [22] Catchwords: CIVIL PROCEDURE — alternative dispute resolution — referral to [NAME] for assessment of remaining claims for damages in representative proceedings — appropriate methodology and procedure — where parties are largely agreed — whether defendant should have ability to issue subpoenas without [NAME]' leave — whether defendant should have ability to cross-examine any individual claimant without [NAME]' leave — whether [NAME] should not commence their preparation prior to the delivery of a reserved judgment by the Court of Appeal relevant to the proceedings — orders for referral made — methodology and procedure stipulated Legislation Cited: Uniform Civil Procedure Rules 2005 Cases Cited: [NAME] v [COMPANY] (No.2) [2017] NSWSC 733 [NAME] v [COMPANY] (No.4) [2022] NSWSC 270 [COMPANY] v [NAME] [2023] NSWCA 74 Texts Cited: Not Applicable Category: Procedural rulings Parties: [NAME] (P) [COMPANY] (D) Representation: Counsel: [redacted] [NAME] / [NAME] (D)

Solicitors: [redacted] [NAME] (D) File Number(s): 2014/223271 Publication restriction: Not Applicable

JUDGMENT 1. This judgment deals with a Notice of Motion filed 9 September 2022 about the methodology and procedure to be followed for the assessment of all remaining claims for damages.

2. The two principal earlier judgments in these proceedings inform the entitlement to damages and provide findings with respect to the sums for damages in identified cases. Those two judgments are: [NAME] v [COMPANY] (No.2) [2017] NSWSC 733; [NAME] v [COMPANY] (No.4) [2022] NSWSC 270.

3. The context in which this Notice of Motion was argued includes the fact that [COMPANY] ("[NAME]") appealed from my judgment in [NAME] (No.4). [ADDRESS] of Appeal heard argument on the appeal and reserved its judgment. On 20 April 2023, the Court of Appeal delivered its judgment: [COMPANY] v [NAME] [2023] NSWCA 74.

4. With the exception of the award of damages for expenditure on airfares, the appeal by [NAME] was dismissed. With respect to airfares damages, the Court of Appeal upheld the appeal, holding that the group members were not entitled to any such damages at all.

5. In light of this judgment of the Court of Appeal, it is now time to address the balance of the claims of the group members. 6. [ADDRESS], in [NAME] (No.4), determined judgments for a range of group members who had taken cruises the subject of adverse findings in [NAME] (No.2).

7. The question dealt with in this judgment is the appropriate procedure to be implemented to enable the assessment of damages for between 850 and 950 individual claims, of the remaining group members.

8. The parties are largely agreed on the orders to be made, but there remain some matters of disputation.

9. The parties are agreed that the assessments should be made by [NAME] appointed by the Court pursuant to the Court's power in r 20.14 and 20.15 of the Uniform Civil Procedure Rules 2005 ("UCPR"). I agree that this is the preferable course.

10. The proposal in general is to appoint a number of senior counsel and other well‑qualified barristers to undertake the assessments which will proceed largely on paper, but with the capacity to cross-examine witnesses where appropriate.

11. It is also agreed that subpoenas may be issued. However, the way in which that may occur is not specifically agreed.

12. Finally, the parties are agreed that the [NAME] should not commence the process of undertaking the hearing of the references until two months has passed from the date of the delivery of judgment of the Court of Appeal. However, there is a dispute between the parties as to whether preparations by the [NAME] ought to begin prior to the Court of Appeal delivering its judgment. This last issue is now moot.

Subpoenas 1. The defendant seeks the ability to issue subpoenas as it wishes. The plaintiff contends that subpoenas should only be issued where leave is first obtained from the [NAME] concerned.

2. I am of the view that the party most likely to issue subpoenas is the defendant. After all, the plaintiffs have been provided by the defendant with the documents necessary to mount their claim, or else they have those documents from their own records. In my view, there ought be no restriction on the defendant issuing subpoenas. The claims are small. Generally, they would fall within the jurisdiction of the Small Claims Division of the [ADDRESS] of NSW. However, in total, the value of the judgment being faced by [NAME] may be significant. Ultimately, the costs of the subpoenas are more likely to fall on the defendant rather than the plaintiff or the individual claimants.

3. The solicitors for the defendant and their client can be expected to recognise that the sums involved in the claims are not large, and that moderation and responsibility ought be exercised in issuing subpoenas. But, ultimately, it will be to their cost.

4. In those circumstances, I do not propose to require the defendant to seek leave to issue subpoenas.

Cross-examination 1. There is a difference in the orders proposed with respect to the ability of the defendant to cross-examine any individual claimant. The plaintiff contends that cross‑examination should only be permitted if the [NAME] considers it helpful.

2. The defendant submits that the proposed orders which contain a right resting in the [NAME] to limit the length of cross-examination or the topics upon which cross-examination may be engaged in, is a sufficient constraint on unnecessary and unduly lengthy cross-examination.

3. It seems to me to be more efficient to permit the defendant to cross-examine any individual claimant and to give the [NAME] in the individual circumstances the right to limit that cross-examination.

4. For that reason, I will make the orders proposed by the defendant in relation to cross-examination.

Reference 1. There will still be sufficient time, namely, at least two months, for the [NAME] to take any preparatory steps for the hearing of the claims of the group members. It seems to me that a further period of three months will be appropriate for the determination of those claims.

Orders 1.

Accordingly, I will make the following orders, and the documents Annexure A and Annexure B referred to in the orders will be those which are attached to this judgment.

1. Order pursuant to rr 20.14 and 20.15 of the Uniform Civil Procedure Rules 2005 (NSW) ("UCPR") that [NAME] and [NAME] be appointed as [NAME] ("the [NAME]") with [NAME] to act as [NAME] ("[NAME]"), to conduct an inquiry and prepare a report to the Court on the questions set out Annexure A to these orders ("the Reference").

2. Order pursuant to r 20.17 of the UCPR that the [NAME] provide the report to the Court by 29 September 2023, or such further date as may be determined.

3. Order pursuant to r 20.18 of the UCPR that the fees of the [NAME] are to be paid in the first instance by the defendant.

4. Order pursuant to r 20.20 of the UCPR that the [NAME] conduct the Reference in accordance with the terms of reference set out in Annexure B to these orders.

5. The parties have liberty to apply for further directions.

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ANNEXURE A

QUESTIONS FOR REFERENCE Proceedings means proceedings number 2014/223271. First Primary Judgment means reasons and orders made in [NAME] v [NAME] (No.2) [2017) NSWSC 733. Second Primary Judgment means reasons and orders made in [NAME] v [NAME] (No. 4) [2022] NSWSC 270. Group Member means a passenger on board Cruises 1 to 9 and 11 as set out in paragraph 13 of the First Primary Judgment excluding the plaintiff and any Group Member who has opted out of the Proceedings or whose claim for damages pursuant to s 267(4) of the Australian Consumer Law was determined in the Second Primary Judgment. For each Group Member:

1. Has the Group Member, because of the failures of the defendant to comply with the purpose or result guarantees in respect of the relevant Cruise as found in the First Primary Judgment, suffered any of the following loss or damage:

1. Distress and/or disappointment; and/or 2. Any other consequential loss claimed by the Group Member which was reasonably foreseeable.

1. If so, what is the amount of damages payable by the defendant to the Group Member for:

1. Distress and/or disappointment (if any);

2. Consequential loss (if any).

ANNEXURE B

TERMS OF REFERENCE Proceedings means proceedings number 2014/223271. First Primary Judgment means reasons and orders made in [NAME] v [NAME] (No.2) [2017] NSWSC 733. Second Primary Judgment means reasons and orders made in [NAME] v [NAME] (No. 4) [2022] NSWSC 270. Group Member means a passenger on board Cruises 1 to 9 and 11 as set out in paragraph 13 of the First Primary Judgment excluding the plaintiff and any Group Member who has opted out of the Proceedings or whose claim for damages pursuant to s 267(4) of the Australian Consumer Law was determined in the Second Primary Judgment.

1. These terms of reference are subject to any more specific orders made by the Court in relation to the conduct of the Reference.

2. The parties are to provide such assistance to the [NAME] as is reasonably necessary to assist the [NAME] in the conduct of the Reference in accordance with these terms of reference.

3. The [NAME] are to consider and implement such manner of conducting the Reference as will, without undue formality or delay, enable a just, quick and cheap resolution of the Reference and completion of the [NAME]' report.

4. In order to facilitate the implementation of the just, quick and cheap resolution of the Reference and completion of the [NAME]' report, the [NAME] are to each make such directions as they consider appropriate as to the conduct of the Reference.

5. The [NAME] may, to the extent that each may consider appropriate: 1. make enquiries by telephone, audio-visual link, in-person, or in writing; 2. make any direction they consider appropriate in relation to the preparation and service of evidence and/or making of submissions by any party, including that any evidence and/or submissions be provided wholly in writing and be limited in length and topic; 3. make directions for the attendance of any person, and/or the production of documents, to be compelled by subpoena; 4. make directions for the conduct of any hearing which they consider appropriate and conduct any such hearing.

1. The Reference is to be conducted with as little formality and technicality as the proper consideration of the matter permits, in a manner which is proportionate to the amounts claimed.

2. Any party is permitted to issue subpoena to produce in respect of production of documents.

3. If any party to the Reference is dissatisfied with any directions made by a [NAME], that party may apply to [NAME] in writing for reconsideration of the directions in question, and [NAME] may set aside, vary, or confirm the directions in question. 4. [NAME] may make directions delegating the conduct of any part of the Reference to any one or more of the [NAME], including the determination of the amount of damages payable to any sub-group of the Group Members on a cruise-by-cruise basis.

5. The rules of evidence do not apply to the Reference.

6. Any evidence before the [NAME] shall, unless the [NAME] otherwise direct, be taken by way of: 1. any statement of agreed facts; and/or 2. a written statement signed by the maker of the statement provided to the [NAME] by a party in accordance with any directions made by the [NAME]; and/or 3. upon an application by either party of oral evidence by way of cross‑examination and re-examination of the maker of any written statement, subject to such limitations as to length and topic as the [NAME] consider appropriate; and/or 4. documents already discovered by the parties in the proceedings which are served in accordance with such directions as the [NAME] may make; 5. such other means as the [NAME] consider appropriate.

1. Notwithstanding clause 11, the [NAME] shall in the first instance determine the Questions for Reference in respect of each Group Member on the basis of: 1. any written statements or other documents that have been served in accordance with any directions made by the [NAME]; 2. any oral evidence; 3. any written submissions of the parties that have been served in accordance with any directions made by the [NAME].

1. If any party to the Reference is dissatisfied with any determination made by any [NAME] in respect of a Group Member in accordance with clause (12) ("the Original Decision"), that party may apply to [NAME] in writing for reconsideration of the Original Decision, stating the grounds for why the Original Decision should be varied or set aside.

2. Upon a party making an application for reconsideration of the Original Decision to [NAME] in accordance with clause (13) [NAME] shall convene a panel of two [NAME] (not including the [NAME] who made the original determination) ("the Panel") to reconsider the Questions for Reference in respect of the Group Member the subject of the Original Decision.

3. The Panel convened in accordance with clause (14) shall conduct a rehearing and for that purpose may conduct any hearing they consider appropriate, and may allow: 1. any written or oral submissions that the Panel considers appropriate; and/or 2. on application by a party, any oral evidence by way of cross‑examination and re-examination of the maker of any written statement, subject to such limitations as to length and topic as the Panel considers appropriate.

1. The Panel upon any such rehearing may: 1. vary the terms of the Original Decision; or 2. set aside the Original Decision; or 3. confirm the Original Decision; or 4. dismiss the application for reconsideration, and if it does any of (a) to (c) above, the decision of the Panel shall take the place of the Original Decision.

1. The final report prepared by the [NAME] and delivered to the Court: 1. may consist of reports prepared in respect of sub-groups of Group Members on a Cruise-by-Cruise basis and reports in respect of individual Group Members where it is not just, cheap and quick to deal with that individual together with the other Group Members on his or her Cruise ("Cruise Reports"); 2. must give reasons for the [NAME]' opinion on the Questions for Reference in respect of each Group Member, which reasons may be contained in each and any Cruise Reports.

1. To the extent that the [NAME] prepare any such Cruise Reports, these shall consist of, in relation to the Group Member(s) the subject of that report: 1. a copy of any written statements and transcripts of evidence; 2. any written submissions or transcripts of oral submissions of the parties; and 3. in respect of the reasons given for the opinion of the [NAME] on the Questions for Reference, either: 1. a transcript of any reasons and determination delivered ex tempore whether orally or in writing from time to time during the course of the Reference; and/or 2. other statement of the [NAME] in writing.

1. The parties are to provide the [NAME] with such administrative assistance as the [NAME] reasonably require, and the costs of providing that administrative assistance are to be costs in the proceedings.

2. The parties shall deliver to each of the [NAME], as soon as practicable after the delivery of reasons for judqment by the [ADDRESS] of Appeal in the appeal from the Second Primary Judgment an agreed brief of materials to include these orders, together with a copy of Part 20, Division 3 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) and a copy of the pleadings and any other material filed or tendered to date in these proceedings relevant to the questions the subject of the Reference.

3. Any amendments to the questions the subject of the Reference or these Terms of Reference, whether by agreement or otherwise, are to be the subject of an order made by the Court.

4. The Reference shall commence on such date as is directed by [NAME], which date shall not be sooner than two months following the delivery of reasons for judgment by the [ADDRESS] of Appeal in the appeal from the Second Primary Judgment, which occurred on 20 April 2023.

5. Notwithstanding the above date for the commencement of the Reference, the [NAME] may begin preparations for the carrying out of the Reference following the delivery of reasons for judgment by the [ADDRESS] of Appeal in the appeal from the Second Primary Judgment including making such enquiries and directions as the [NAME] consider appropriate to facilitate the efficient conduct of the Reference upon its commencement. 6. [NAME] shall submit the report to the Court in accordance with r 20.23 of the UCPR by the date specified in the Court's orders by email to the Chambers of Justice Garling.

7. If for any reason the [NAME] are unable to comply with the order for delivery of their report to the Court by the date in the order, [NAME] is to provide to the Court an interim report setting out the reasons for such inability and an application to extend the time within which to deliver the report to the Court to a date when the [NAME] will be able to provide the report.

8. The [NAME] and each of the parties have liberty to seek directions with respect to any matte arising upon application made on 2 business days' notice in writing, save that if a matter requires the urgent assistance of the Court, the [NAME] or a party may approach the Chambers of Justice Garling by email, copied to the other party or parties. 9. [NAME] and each of the parties have liberty to apply to the Court to seek directions for the removal or substitution of any of the [NAME], or the addition of further [NAME]: 1. if any [NAME] is unable or unavailable to carry out the Reference; or 2. in any other circumstance in which the Court considers it appropriate and in accordance with the just, quick and cheap resolution of the Reference, to remove or substitute any of the [NAME], or add further [NAME].

Amendments 22 June 2023 - Amendment to counsel appearances on coversheet. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 22 June 2023