Mallia v Colonial First State Investments Ltd [2026] FCA 463 - Settlement Approved

Original Word Document (220.6 KB) FEDERAL COURT OF AUSTRALIA

Mallia v Colonial First State Investments Ltd [2026] FCA 463

| File number: | VID 28 of 2020 |

| Judgment of: | BENNETT J |

| Date of judgment: | 25 March 2026 |

| Date of publication of reasons: | 17 April 2026 |

| Catchwords: | REPRESENTATIVE PROCEEDINGS – application for approval of settlement under s 33V of the Federal Court of Australia Act 1976 (Cth) – shareholder class action – whether proposed settlement is fair and reasonable – whether proposed deductions are fair and reasonable – deductions for legal costs and funding commission – appropriateness of deduction for cost of obtaining “after the event” insurance – settlement approved |

| Legislation: | Federal Court of Australia Act 1976 (Cth)

Superannuation (Unclaimed Money and Lost Members) Act 1999 (Cth) |

| Cases cited: | Australian Securities and Investments Commission v Ferratum Australia Pty Ltd (in liq) [2023] FCA 1043

Australian Securities and Investments Commission v Richards [2013] FCAFC 89

Blairgowrie Trading Ltd v Allco Finance Group Ltd (Receivers & Managers Appointed) (in liq) (No 3) [2017] FCA 330; 343 ALR 476

Bradshaw v BSA Limited (No 2) [2022] FCA 1440

Brady v NULIS (No 4) [2024] FCA 1374

Caason Investments Pty Ltd v Cao (No 2) [2018] FCA 527

Camilleri v The Trust Company (Nominees) Ltd [2015] FCA 1468

Coatman v Colonial First State Investments Limited [2022] FCA 1611

Court v Spotless Group Holdings Ltd [2020] FCA 1730

Darwalla Milling Co Pty Ltd v F Hoffman-La Roche Ltd (No 2) [2006] FCA 1388; 236 ALR 322

Deputy Commissioner of Taxation v Peever [2025] FCA 460

Dillon v RBS Group (Australia) Pty Limited (No 2) [2018] FCA 395

Elliot-Carde v McDonald’s Australia Limited [2023] FCAFC 162; 301 FCR 1

Evans v Davantage Group Pty Ltd (No 3) [2021] FCA 70

Galactic Seven Eleven Litigation Holdings LLC v Davaria [2024] FCAFC 54; 302 FCR 493

Ghee v BT Funds Management Ltd [2023] FCA 1553

Hall v Arnold Bloch Leibler (No 2) [2022] FCA 163

J&J Richards Super Pty Ltd ATF the J&J Richards Superannuation Fund v Nielsen (No 2) [2025] FCA 431

Janssen v OnePath Custodians Pty Ltd (No 2) [2026] FCA 291

Jenkings v Northern Territory of Australia (No 5) [2021] FCA 1585

Kain v RandB Investments Pty Ltd [2025] HCA 28; 99 ALJR 1138

Krieger v Colonial First State Investments Limited [2024] FCA 1402

Levitt v Luke in his capacity as the co-executor of the estate of Luke (Deceased) [2025] FCAFC 79

Lifeplan Australia Friendly Society Ltd v S&P Global Inc (formerly McGraw-Hill Financial Inc) (a Company incorporated in New York) [2018] FCA 379

Lopez v Star World Enterprises Pty Ltd [1999] FCA 104

McDonald v Commonwealth of Australia [2025] FCA 380

McKenzie v Cash Converters International Ltd (No 4) [2019] FCA 166; 134 ACSR 327

Modtech Engineering Pty Ltd v GPT Management Holdings Limited [2013] FCA 62

Money Max Int Pty Ltd (trustee) v QBE Insurance Group Limited [2016] FCAFC 148; 245 FCR 191

Newstart 123 Pty Ltd v Billabong International Ltd [2016] FCA 119

Pharm-A-Care Laboratories Pty Ltd v Commonwealth (No 6) [2011] FCA 277

Prygodicz v Commonwealth (No 2) [2021] FCA 634; 173 ALD 277

Webb v GetSwift Ltd (No 7) [2023] FCA 90; 414 ALR 500

Williams v FAI Home Security Pty Ltd (No 4) [2000] FCA 1925; 180 ALR 459 |

| Division: | General Division |

| Registry: | Victoria |

| National Practice Area: | Commercial and Corporations |

| Sub-area: | Commercial Contracts, Banking, Finance and Insurance |

| Number of paragraphs: | 94 |

| Date of hearing: | 25 March 2026 |

| Counsel for the Applicant: | J Stoljar SC with T L Bagley and A Mobrici |

| Solicitor for the Applicant: | Shine Lawyers |

| Counsel for the Respondents: | I Ahmed SC with C Wong |

| Solicitor for the Respondents: | Clayton Utz |

| Counsel for the Intervener: | J A Arnott SC |

| Solicitor for the Intervener: | Woodsford Australia |

| Counsel for the Contradictor: | D Sulan SC with B Szabo |

ORDERS

| VID 28 of 2020 |

| BETWEEN: | SIMON MALLIA

Applicant | |
| AND: | COLONIAL FIRST STATE INVESTMENTS LTD (ACN 002 348 352)

First Respondent

THE COLONIAL MUTUAL LIFE ASSURANCE SOCIETY LIMITED (ACN 004 021 809)

Second Respondent

AIA AUSTRALIA LIMITED (ACN 004 837 861) (and another named in the Schedule)

Third Respondent | |

| order made by: | BENNETT J |
| DATE OF ORDER: | 25 MARCH 2026 |
THE COURT ORDERS THAT:

1.    Pursuant to s 33ZF of the Federal Court of Australia Act 1976 (Cth) (the Act), the Applicant is authorised, nunc pro tunc, to enter into and give effect to the Settlement Deed dated 6 February 2026, and the Deed of Variation executed 24 March 2026, and the transactions thereby contemplated for and on behalf of each of the Group Members pursuant to the Settlement Distribution Scheme (a scheme setting out the principles for the application and distribution of the Settlement Sum) (SDS).

2.    Pursuant to s 33V(1) of the Act, the Court approve the settlement of the proceeding on the terms of the Settlement Deed, Deed of Variation and the SDS.

3.    Pursuant to s 33V(2) of the Act, the following deductions from the settlement sum are approved:

(a)    an amount equalling 27.5% of the settlement sum as commission payable to Woodsford Litigation Funding 1 LLP (company number OC432952, registered in England & Wales) as the Funder;

(b)    legal costs and disbursements (including uplift) in the amount of

(c)    $15,717,695.01;

(d)    The sum of $20,000 to reimburse the Applicant.

(e)    the sum of $1,000 each to reimburse Christopher Harrison, Sean Grice, Matthew Webber and Ronny Ahmajani;

(f)    the sum of $1,494 incurred in relation to stamp duty paid on the Settlement Deed; and

(g)    the reasonable expenses of and incidental to the administration process carried out in accordance with the SDS by:

(i)    Shine Lawyers, as the settlement administrator, in the amount of

(ii)    $374,226.37; and

(iii)    Ernst & Young, as the expert consultant, in the amount of $712,236.80.

4.    Pursuant to s 33ZB of the Act, that the settlement in the Settlement Deed and Deed of Variation be binding upon the Applicant, the Respondents and Group Members.

5.    Avanteos Investments Limited be joined as the Fourth Respondent to the Proceeding.

6.    The orders for security for costs orders dated 11 May 2020, 7 April 2022 and 18 April 2024 be vacated, and the sum of $20,000 paid under order 2 of the orders dated 11 May 2020 of his Honour Justice Beach be refunded to Shine Lawyers.

7.    Pursuant to ss 33V and/or 33ZF of the Act and in accordance with the SDS:

(a)    The First Respondent and Avanteos Investments Limited be jointly appointed Settlement Distributor of the SDS,

(b)    Ernst & Young be appointed Expert Consultant under the SDS; and

(c)    Shine Lawyers be appointed Settlement Administrator under the SDS.

8.    The Settlement Administrator and Settlement Distributor have leave to apply to the Court for directions in respect of the administration of the SDS.

Confidentiality

9.    Pursuant to s 37AF of the Act, publication or other disclosure of the material identified as one or more of Categories 1, 2, 3 or 4 in Annexure A to these orders is limited as follows:

(a)    Category 1 (being information that would give the Respondents a tactical or forensic advantage in the litigation in the event approval for the settlement is not granted and the proceedings were to continue) publication or other disclosure is not to be made to the Respondents and non-parties for a period of time from the date of these orders until the settlement approval is granted and the period for an appeal lapses.

(b)    Category 2 (being the Applicant’s legal advice and other privileged communications which have been shared with the Funder on a common interest basis) publication or other disclosure is not to be made to the Respondents and non-parties.

(c)    Category 3 (being inter partes without prejudice and confidential material contained in the Deed Poll and Heads of Agreement, which are currently the subject of orders made by the Court on 19 December 2025) publication or other disclosure is to not be made to non-parties.

(d)    Category 4 (being commercially sensitive information of value to Shine Lawyers or the Funder and, therefore, to their respective competitors, and which may confer a tactical advantage to respondents or competitors in current or future litigation by providing information about how Shine Lawyers and/or the Funder operate their respective businesses) subject to further order, publication or other disclosure is not to be made to the Respondents and non-parties for a period of three years.

Validity of opt out

10.    The following group members will be deemed to have validly opted out of the proceeding:

(a)    any group members who, between after 3 October 2025 and on or before 23 March 2026, submitted an opt out notice that was in the form required by the orders made on 26 August 2025 and 19 December 2025 (Opt Out Orders), with sufficient information to allow them to be identified in the Records of the Respondents.

(b)    subject to order 11 below, any group members who, on or before 23 March 2026, submitted an opt out notice that either or both:

(i)    was not in the form required by the Opt Out Orders; or

(ii)    did not contain sufficient information to allow the Respondents to verify the identity of the person for whom the notice was submitted, or the authority of the person submitting it,

in respect of which the parties have since obtained sufficient information to rectify the above shortcomings;

11.    Any group members who submitted an opt out notice as described at orders 10(b) above, but subsequently notified the solicitors for the Applicant on or before 23 March 2026 that they did not wish to opt out of the proceeding, remain as group members in the proceeding.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

SCHEDULE

No: VID 28 of 2020

Federal Court of Australia

District Registry: Victoria Registry

Division: General

Second Respondent         THE COLONIAL MUTUAL LIFE ASSURANCE SOCIETY LIMITED (ACN 004 021 809)

Third Respondent             AIA AUSTRALIA LIMITED (ACN 004 837 861)

Fourth Respondent          AVANTEOS INVESTMENTS LIMITED

Annexure A

| Item No. | Description of filed document | Part of document over which the suppression order applies (references to words include a reference to numbers and symbols) | Category | Parties to whom publication or other disclosure is not to be made |
| 1. | Affidavit of Craig Allsopp affirmed on 3 March 2026 (Allsopp Affidavit) | Table of contents, details column in relation to CRA- 3: Tab 1 – 3, CRA-4: Tab 1 | 1, 3 | Respondents, non- parties |
| 2. | Allsopp Affidavit | Subparagraph 56(e), the words following “Mr McGing produced 2 expert reports,” and to the end of the subparagraph | 1 | Respondents, non- parties |
| 3. | Allsopp Affidavit | Subparagraph 138(b), the whole subparagraph | 1 | Respondents, non- parties |
| 4. | Allsopp Affidavit | Paragraph 172, the whole paragraph | 3 | Respondents, non- parties |
| 5. | Allsopp Affidavit | Subparagraph 173(a), the whole subparagraph prior to “; and” | 3 | Respondents, non- parties |
| 6. | Allsopp Affidavit | Subparagraph 187(a), the whole subparagraph prior to “; and” | 3 | Respondents, non- parties |
| 7. | Allsopp Affidavit | Subparagraphs 190 (a) – (c), the whole of each subparagraph | 4 | Respondents, non- parties |
| 8. | Allsopp Affidavit | Subparagraph 191(a), the whole subparagraph prior to “; and” | 3 | Respondents, non- parties |
| 9. | Allsopp Affidavit | Subparagraph 210(a), the whole subparagraph prior to “; and” | 3 | Respondents, non- parties |
| 10. | Allsopp Affidavit | Subparagraphs 211(a) – (c), the whole of the subparagraphs | 3 | Respondents, non- parties |
| 11. | Allsopp Affidavit | Paragraph 212, the words following “duty forms part of” and to the end of the paragraph. | 3 | Respondents, non- parties |
| 12. | Allsopp Affidavit | Paragraph 220, the words following “the deed states,” and to the end of the paragraph | 3 | Respondents, non- parties |
| 13. | Allsopp Affidavit | Paragraph 225, the words following “the Deed provides” and to the end of the paragraph | 3 | Respondents, non- parties |
| 14. | Allsopp Affidavit | Paragraph 236, the whole paragraph | 1 | Respondents, non- parties |
| 15. | Allsopp Affidavit | Paragraph 238, the words prior to “However, following further conferral” and to the beginning of the paragraph | 3 | Respondents, non- parties |
| 16. | Exhibit CRA-3 to the Allsopp Affidavit | The whole exhibit | 3 | Non-parties |
| 17. | Exhibit CRA-4 to the Allsopp Affidavit | The whole exhibit | 1 | Respondents, non- parties |
| 18. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 1, clauses 6 – 7, the whole of the clauses | 4 | Respondents |
| 19. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 1, clause 36, table, all of the text in the cells containing the words “Low range” and “High range” save for those words | 2, 4 | Respondents |
| 20. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 1, clause 36, table, the words contained in the cells beneath the cells containing the words “Low range” and “High range” | 2, 4 | Respondents |
| 21. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 1, clause 37, table, all of the words in the cells containing the words “Low range” and “High range” save for those words | 2, 4 | Respondents |
| 22. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 1, clause 37, table, the words contained in the cells beneath the cells containing the words “Low range” and “High range” | 2, 4 | Respondents |
| 23. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 2, clause 1.2.1, the words following “the Lawyers’ Fees,” and to the end of the paragraph | 4 | Respondents |
| 24. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 2, clause 1.2.2, the words following “third- party costs,” and before “including Counsel’s fees” | 4 | Respondents |
| 25. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 2, clause 1.2.3, the words following “pre- agreed by the Funder” | 4 | Respondents |
| 26. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 2, clause 1.17, the words following “means” and before “as may be increased” | 4 | Respondents |
| 27. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 2, clauses 1.21.1 and 1.21.2, the whole of the clauses | 4 | Respondents |
| 28. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 2, clause 1.29, the words following “and the terms of Engagement” and to the end of the clause | 4 | Respondents |
| 29. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 2, clause 1.33 – 1.34, the whole of each clause | 4 | Respondents |
| 30. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 2, clause 1.38, the whole of the clause | 4 | Respondents |
| 31. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 2, clauses 2 – 3 the whole of each clause | 4 | Respondents |
| 32. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 2, clauses 7.3 – 7.6, the whole of each clause | 4 | Respondents |
| 33. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 2, clauses 8.3.1 – 8.3.3, the whole of each clause | 4 | Respondents |
| 34. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 2, clause 12, the whole of the clause | 4 | Respondents |
| 35. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clause 1.2.1, the words following “the Lawyers’ Fees” and to the end of the clause | 4 | Respondents |
| 36. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clause 1.2.2, the words following “third- party costs,” and before “including Counsel’s fees” | 4 | Respondents |
| 37. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clause 1.2.3, the words following “pre- agreed by the Funder” and to the end of the clause | 4 | Respondents |
| 38. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clause 1.18, the words following “Costs Limit” and before “as may be increased” | 4 | Respondents |
| 39. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clauses 1.22.1 – 1.22.2, the whole of the clauses | 4 | Respondents |
| 40. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clause 1.32, the words following “the Terms of Engagement,” and to the end of the clause | 4 | Respondents |
| 41. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clauses 1.36 – 1.37, the whole of each clause | 4 | Respondents |
| 42. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clause 1.41, the whole clause | 4 | Respondents |
| 43. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clauses 2 – 3, the whole of each clause | 4 | Respondents |
| 44. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clause 5.1.3, the whole of the clause | 4 | Respondents |
| 45. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clauses 5.2 – 5.3, the whole of each clause | 4 | Respondents |
| 46. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clause 7.3 – 7.6, the whole of each clause | 4 | Respondents |
| 47. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clauses 8.3.1 – 8.3.3, the whole of each clause | 4 | Respondents |
| 48. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clauses 8.4.1 – 8.4.3, the whole of each clause | 4 | Respondents |
| 49. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 3, clause 12, the whole clause | 4 | Respondents |
| 50. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 8

December 2023, subparagraphs 4(a) – (d), the whole of each subparagraph | 2 | Respondents |
| 51. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 8

December 2023, subparagraphs 6(a) – (d), the whole of the subparagraphs | 2 | Respondents |
| 52. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, paragraph 7, the whole paragraph | 2 | Respondents |
| 53. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 8

December 2023, paragraph 8, table, the whole of the table below the cell containing the words “Previous Estimate | 2 | Respondents |
| (including GST) |
| 54. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 8

December 2023, paragraph 9, the words following (Legal Costs) are” and to the end of the paragraph including the table below | 2 | Respondents |
| 55. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 8

December 2023, subparagraphs 10(a) – (e), the whole of each subparagraph | 2 | Respondents |
| 56. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 8

December 2023, paragraph 11, the whole of the table below the words “as follows:” | 2 | Respondents |
| 57. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 8

December 2023, paragraphs 12 – 14, the whole of each paragraph | 2, 4 | Respondents |
| 58. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 8

December 2023, subparagraphs 15(a) – (b), the whole of each subparagraph | 2 | Respondents |
| 59. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 27 May

2025, paragraph 3, the whole of the table save for the header | 2 | Respondents |
| 60. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 27 May

2025, paragraph 4, the whole paragraph | 2 | Respondents |
| 61. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 27 May 2025, subparagraphs 5(a) – (b), the whole of each subparagraph | 2 | Respondents |
| 62. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 27 May 2025, subparagraphs 6(a) – (e), the whole of each subparagraph | 2 | Respondents |
| 63. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 27 May

2025, paragraph 7, the whole of the table save the header | 2 | Respondents |
| 64. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 27 May

2025, paragraphs 8 – 10, the whole of each paragraph | 2, 4 | Respondents |
| 65. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 19

September 2025, paragraph 3, the whole of the table save for the header | 2 | Respondents |
| 66. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 19

September 2025, paragraph 4, the whole of the table | 2 | Respondents |
| 67. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 19

September 2025, subparagraphs 5(a) – (e) | 2 | Respondents |
| 68. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 19

September 2025, subparagraphs 6(a) – (e) | 2 | Respondents |
| 69. | Exhibit CRA-5 to the Allsopp Affidavit | Tab 4, letter dated 19

September 2025, paragraphs

7 – 9 | 2, 4 | Respondents |
| 70. | Funder’s outline of submissions filed 6 March 2026 | Subparagraph 28(d) and (f), the whole of each subparagraph | 1 | Respondents, non- parties |
| 71. | Funder’s outline of submissions filed 6 March 2026 | Subparagraph 28(g), the words following “since June 2020),” and to the end of the subparagraph | 4 | Respondents, non- parties |
| 72. | Funder’s outline of submissions filed 6 March 2026 | Paragraph 33, the words following “Woodsford has paid” and before “in upfront premiums” | 4 | Respondents, non- parties |
| 73. | Funder’s outline of submissions filed 6 March 2026 | Paragraph 33, the words following “upfront premiums and” and before “for deeds of indemnity” | 4 | Respondents, non- parties |
| 74. | Funder’s outline of submissions filed 6 March 2026 | Paragraph 33, the words following “Under the policy,” and before “is payable as a” | 4 | Respondents, non- parties |
| 75. | Affidavit of Charles Samuel Morris affirmed 5 March 2026 (Morris Affidavit) | Subparagraph 25(i), the words following “the Court suggest, was different. 5 ” and before “and the funding commission sought” | 1, 2 | Respondents, non- parties |
| 76. | Morris Affidavit | Subparagraph 26(b), the whole subparagraph | 1, 2 | Respondents, non- parties |
| 77. | Morris Affidavit | Paragraph 30, the words following “a limit of” and before “While I do not” | 1 | Respondents, non- parties |
| 78. | Morris Affidavit | Paragraph 30, the words following “can be significant” and before “The Court made orders on 22 December 2025” | 1 | Respondents, non- parties |
| 79. | Morris Affidavit | Paragraph 31, the whole paragraph | 4 | Respondents, non- parties |
| 80. | Morris Affidavit | Paragraph 34, the words following “or agreed, to pay,” and before “A copy of the ATE policy” | 1 | Respondents, non- parties |
| 81. | Morris Affidavit | Subparagraph 35(b), the words following “class of placing security” and to the end of the subparagraph | 1 | Respondents, non- parties |
| 82. | Morris Affidavit | Paragraph 37, the whole subparagraph | 1 | Respondents, non- parties |
| 83. | Morris Affidavit | Subparagraphs 38(a) – (c), the whole of each subparagraph | 1 | Respondents, non- parties |
| 84. | Morris Affidavit | Subparagraph 39(a), the words following “into Court.” And to the end of the subparagraph | 4 | Respondents, non- parties |
| 85. | Morris Affidavit | Paragraph 40, the whole of the paragraph | 4 | Respondents, non- parties |
| 86. | Morris Affidavit | Paragraph 41, the words following “CFSIL Claim, being” and before “to be deducted” | 4 | Respondents, non- parties |
| 87. | Morris Affidavit | Subparagraph 41(b), the words following “as security for costs.” and to the end of the subparagraph | 4 | Respondents, non- parties |
| 88. | Morris Affidavit | Subparagraph 41(c), the whole paragraph | 1 | Respondents, non- parties |
| 89. | Morris Affidavit | Footer to page 16, the whole of the footer | 4 | Respondents, non- parties |
| 90. | Morris Affidavit | Paragraph 53, the whole of the paragraph and the heading immediately above | 1, 2 | Respondents, non- parties |
| 91. | Morris Affidavit | Paragraphs 59 – 63, the whole of each paragraph and heading | 1, 2 | Respondents, non- parties |
| 92. | Morris Affidavit | Footer to page 24, the whole footer | 1 | Respondents, non- parties |
| 93. | Morris Affidavit | Paragraph 64, the heading immediately above | 1 | Respondents, non- parties |
| 94. | Morris Affidavit | Paragraph 64, the words before “According to the ALRC Report” and to the beginning of the paragraph | 1 | Respondents, non- parties |
| 95. | Morris Affidavit | Paragraph 64, the words following “134 to 135 of CSM-1” and before “Woodsford started work” | 2 | Respondents, non- parties |
| 96. | Morris Affidavit | Paragraph 64, the words following “began funding disbursements” and to the end of the paragraph | 4 | Respondents, non- parties |
| 97. | Morris Affidavit | Paragraph 65, the words before “I have reviewed” and to the beginning of the paragraph | 4 | Respondents, non- parties |
| 98. | Morris Affidavit | Footer to page 25, the whole footer | 4 | Respondents, non- parties |
| 99. | Morris Affidavit | Paragraph 67, the words following “as cover” and to the end of the paragraph | 4 | Respondents, non- parties |
| 100. | Morris Affidavit | Paragraph 70, the words following “Funder’s Success Fee increases.” and before “The figure of

$3,535,000 | 4 | Respondents, non- parties |
| 101. | Exhibit CSM-2 to the Morris Affidavit | The whole exhibit | 1, 4 | Respondents, non- parties |
| 102. | Contradictor’s submissions dated 18 March 2026 (Contradictor’s Submissions) | Paragraphs 17 – 18, the whole of each paragraph | 1 | Respondents, non- parties |
| 103. | Contradictor’s Submissions | Paragraph 20, the whole of the paragraph | 1 | Respondents, non- parties |
| 104. | Contradictor’s Submissions | Subparagraphs 57(a) – (c), the whole of each sub- paragraph | 1 | Respondents, non- parties |
| 105. | Contradictor’s Submissions | Paragraph 58, the whole paragraph | 1 | Respondents, non- parties |
| 106. | Contradictor’s Submissions | Paragraph 59, the words following “costs contemplated” and before “CCA at [31]”. | 2, 4 | Respondents, non- parties |
| 107. | Contradictor’s Submissions | Paragraph 60, the words following “costs incurred.” And before “that arrangement” | 1 | Respondents, non- parties |
| 108. | Contradictor’s Submissions | Paragraph 61, the words following “a limit of” and before “Morris Affidavit” | 1 | Respondents, non- parties |
| 109. | Contradictor’s Submissions | Subparagraphs 62(a) – (c), the whole of each subparagraph | 1 | Respondents, non- parties |
| 110. | Contradictor’s Submissions | Paragraph 63, the words before “However, the extent” and to the beginning of the paragraph | 1 | Respondents, non- parties |
| 111. | Contradictor’s Submissions | Paragraph 63, the words following “in excess of” and before “is minimal” | 1, 4 | Respondents, non- parties |
| 112. | Contradictor’s Submissions | Paragraph 70, the words following “ever contractually” and before “and the adverse” | 1 | Respondents, non- parties |
| 113. | Funder’s Outline of Submissions dated 23 March 2026 | Paragraph 9, the words following “were substantial.” and before “This was not a …”. | 1 | Respondents, non- parties |
| 114. | Funder’s Outline of Reply Submissions dated 23 March 2026 | Paragraph 13, the word between “had a” and “did not eliminate”; and the words between “own costs” and “and which the”. | 1,4 | Respondents, non- parties |
| 115. | Funder’s Outline of Reply Submissions dated 23 March 2026 | Paragraph 15, the word between “funded was” and “per annum”. | 4 | Respondents, non- parties |
| 116. | Exhibit CRA-9 to the Affidavit of Craig Allsopp affirmed on 24 March 2026 | The whole exhibit | 3 | Non-parties |
| 117. | Affidavit of Craig Allsopp affirmed 24 March 2026 | Paragraph 7, after the words “the Deed” | 3 | Non-parties |
| 118. | Exhibit CRA-8 to the Affidavit of Craig Allsopp affirmed on 23 March 2026 | The whole exhibit | 3 | Non-parties |
Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

(Delivered ex tempore, revised from transcript)

BENNETT J:

1 This is an application under s 33V of the Federal Court of Australia Act 1976 (Cth) for approval of a proposed settlement of representative proceedings against Colonial First State Investments Ltd (the F irst R espondent) and The Colonial Mutual Life Assurance Society Limited (the S econd R espondent).

2 The proceeding has resolved on terms that include a payment of $140 million in full and final settlement of the Applicant's and the group members' claims in the proceeding on a non-admissions basis and with no order as to costs.

3 Under the proposed settlement distribution, the Applicant and group members will receive approximately 57.5% ($80.47 million) of the settlement sum after deductions are made for legal costs and litigation funding charges.  There are approximately 840,000 group members who will participate in the settlement.  Only 11 group member objections have been received, and two of those objections are, in substance, informal attempts to register for the settlement rather than true objections.

4 For the purpose of the application, the Applicant relies on: (a) the affidavit of Craig Allsopp, solicitor for the Applicant, affirmed on 3 March (F irst Allsopp A ffidavit), which exhibits, among other things, a confidential opinion of counsel dated 3 March 2026 and  an expert report of Ms Kerrie Rosati, the independent costs consultant; (b) the affidavit of Craig Allsopp affirmed on 23 March 2026 (Second Allsopp Affidavit); (c) the affidavit of Craig Allsopp affirmed on 24 March 2026 (T hird Allsopp A ffidavit).

5 Woodsford Litigation Funding 1 LLP (the F under) and Woodsford Group Limited (a company incorporated and registered in England and Wales, formerly known as Woodsford Litigation Funding Limited) (together, the Woodsford P arties) were, by leave, permitted to intervene in relation to this application and made submissions in connection with the orders that affected them.  The Woodsford Parties sought a funding commission, reimbursement of legal costs and other costs incurred by the Funder, including reimbursement for “after the event” (ATE) insurance, which provided for cover for the Applicant up to the policy limit for adverse costs.  The Woodsford Parties relied upon the affidavit of Charles Morris (Chief Investment Officer of Woodsford Group Limited) affirmed on 5 March 2026 (Morris Affidavit). Certain non-publication orders were sought in respect of different parts of the evidence and submissions of the parties.

6 A contradictor was appointed and submissions were filed to assist the Court, and the Court is grateful for the assistance provided by the contradictor, Mr Sulan SC with Ms Szabo.

7 For the reasons explained in greater detail below, I have decided to approve the settlement distribution scheme and approve most of the deductions sought by the Funder. I have decided I will not authorise the payment of the amount of $4,488,400 on account of ATE insurance costs and fees for the deeds of indemnity provided by the Respondents by way of security for costs.

BACKGROUND

Applicant’s claims

8 The Applicant's claims against the Respondents centred around the conduct of the First Respondent as the trustee of the following superannuation funds:

(a)    FirstChoice Personal Super and Pension;

(b)    FirstChoice Wholesale Personal Super and Pension;

(c)    FirstChoice Employer Super; and

(d)    Commonwealth Essential Super,

together, the CFSIL F unds.

9 It was alleged the First Respondent owed legislative and general law duties to, in general terms, act in the best interests of the members of the CFSIL Funds and not to improperly use its position to gain advantage for itself or its related entity, the Second Respondent.

10 In broad terms, it was alleged that:

(1)    the First Respondent breached its statutory and general law duties by obtaining group insurance with excessive premiums from the Second Respondent when there were other available insurance products that were substantially equivalent or better and had cheaper premiums (the difference being the “excess premiums”); and

(2)    the Second Respondent knew, or ought to have known, of the existence of the duties owed by the First Respondent to its members, and it was involved in, and knowingly took receipt of, profits relating to the excess premiums.

11 The group members are people who were members of at least one CFSIL Fund and held insurance cover under a group policy of insurance issued by the Second Respondent to the First Respondent as trustee of the CFSIL Funds for the period between 22 January 2020 and 15 February 2022.

Procedural history

12 Investigations preliminary to the present proceedings were commenced by Shine Lawyers in November 2018.  Counsel were engaged relatively early in the investigation and were involved in the drafting of the originating process and statement of claim.  The proceeding was commenced on 22 January 2020, and a range of interlocutory steps were taken, including various amendments to the pleadings, security for costs applications, discovery, preparation of evidence and other steps preparatory to trial.

13 There were three separate amendments to the pleadings:

(1)    in October 2021, by which AIA Australia Limited (AIAA) was joined as a respondent following the transfer of the Second Respondent's life insurance business to AIAA on 1 April 2021;

(2)    in June 2023, by which the claim period was extended and sample group members were included, along with further detail being added to the pleadings and particulars following discovery and expert evidence; and

(3)    in July 2025, which addressed the replacement of some of the Applicant's expert evidence, further refined the pleadings pursuant to the Applicant's trial preparation and replaced a sample group member who had passed away.

14 Each Respondent filed a defence to each pleading.

15 The amount of $4,900,000 for security for costs was provided by way of several deeds of indemnity from the ATE insurer.  This is an issue to which I will return.

16 Discovery orders were made from 2020, generally by consent.  A total of 27,000 documents were discovered as part of the process, including approximately 40 gigabytes of large Excel files containing data extracts.

17 Evidence was prepared, including experts in superannuation trusteeship, the pricing of group life insurance and superannuation, the quantification of loss in class actions, a lawyer specialising in superannuation trust law, and an actuary.  After one expert became unavailable, further expert evidence was proffered by another expert engaged by the Applicant.  The Respondents filed responsive expert evidence.  There were conferrals between the experts.  Between them, the experts produced around 18 reports in chief and some further reports in reply.

18 The Applicant did not file lay evidence, but was required to consider the lay evidence filed by the Respondents, which involved the filing of about six affidavits and, after a witness withdrew their willingness to give evidence, a further two affidavits.  The final two affidavits were filed late, requiring leave, and the Applicant asserted this required reconsideration of evidence already filed and the redrafting of certain documents.

19 On 1 May 2024, the Applicant issued subpoenas addressed to TAL Life Limited, MLC Life Insurance, MetLife Insurance and Zurich Australia Limited (together, the S ubpoena A ddressees).  In broad terms, those subpoenas related to the disagreement between the parties' expert witnesses regarding the decision of the First Respondent not to conduct a market tender for the CFSIL Funds and whether a market tender would produce benefits to members as claimed by the Applicant.  The Subpoena Addressees contested the subpoenas and various affidavits and submissions were filed in relation to each of their set-aside applications.  Following negotiation, the set-aside applications were withdrawn and a compromise reached for partial production.  The Applicant paid the subpoena compliance costs of certain Subpoena Addressees, and there were extant orders for payment of compliance costs in relation to the other Subpoena Addressees that remain unclaimed.

20 On 7 February 2025, the matter was set down for a three-week trial commencing 6 October 2025, and the Applicant conducted significant trial preparation.

21 Heads of agreement were signed on 23 September 2025, and there has since been work carried out to seek Court approval for settlement.

22 By orders dated 15 December 2023, the parties were ordered to confer with a view to agreeing the steps for the distribution of the notice regarding the right of group members to opt out of the proceeding and for the proposed form of order relating to that process. Orders for opt-out were made on 26 August 2025 (Opt-Out Orders). The Opt-Out Orders provided a process by which notices would be delivered to group members.  There were some technical difficulties with some of those deliveries, and so some notices were sent by post.  The process for delivering the opt-out notices to some of the group members who did not receive emails was interrupted by the conclusion of heads of agreement. The terms of a settlement approval notice were approved by the Court on 19 December 2025.  Group members who had not previously received an opt-out notice received a combined opt-out notice and settlement notice, with additional time to opt out.  Group members who had previously received the opt-out notice would receive the settlement notice only.  Both notices were sent by email, with copies made available on the Federal Court website, Shine Lawyers' website and in person at the Court's District Registries.  A revised methodology for the distribution of emails was agreed to reduce the level of undelivered messages.

23 As at the date of the First Allsopp Affidavit, 717 opt-out notices had been received by Shine Lawyers, inclusive of some possible duplicates, and the Second Allsopp Affidavit sets out Shine Lawyers' analysis of those notices.  The Second Allsopp Affidavit identifies the steps undertaken by Shine Lawyers to uplift further opt-out notices and objections from the Court's Registry since the First Allsopp Affidavit.  In short, Shine Lawyers only received the opt-out notices at 3.08 pm on 23 March 2026, being the date of the Second Allsopp Affidavit.  No criticism is made of Shine Lawyers or the Registry staff.  At the time of filing of the Second Allsopp Affidavit, Shine Lawyers had not had the opportunity to review that further tranche of opt-out notices.

24 The Third Allsopp Affidavit confirms that, assuming all of the opt-out notices uplifted on 23 March are valid and not duplicates and assuming there are no additional hard copy notices, which the Registry was not able to confirm, as at the date of that affidavit, 557 further opt-out notices had been received.  He expresses his opinion that the actual number of opt-out notices is likely to be 1,274, which may include some duplicates. I have proceeded on the basis that there may be some duplicates, but there are at most 1,274 notices.  That is 0.15% of the total of the group members and 0.22% of the total settlement notices sent.

25 As at the date of the Third Allsopp Affidavit, 11 objection notices to the settlement had been received, and of the 11 objection notices, two have been confirmed by the objectors not to have been intended to be objections but instead were an attempt to register to participate, and I will return to this issue later in the reasons.

WHETHER TO APPROVE THE PROPOSED SETTLEMENT AND SETTLEMENT DISTRIBUTION SCHEME

26 On 23 September 2025, the parties entered into heads of agreement reflecting, in principle, terms of the settlement of the proceedings, and I have been provided with a copy of the heads of agreement.  On 2 February 2026, the parties entered into the settlement deeds subject to the present application.  In summary, it involves

(1)    a payment by the First Respondent of $140 million (the S ettlement S um) in full and final settlement to the Applicant and group members' claims;

(2)    payment out of the Settlement Sum of the Applicant's approved costs, subject to the Court's approval, being:

(a)    the Applicant’s legal costs and disbursements of the proceeding;

(b)    any amount payable to the Funder pursuant to the funding agreement, including:

(i)    a Funder’s success fee of 27.5% of the gross proceeds;

(ii)    reimbursement to the Funder for legal costs and disbursements;

(iii)    reimbursement of all other fees and costs relating to the proceeding reasonably incurred by the Funder; and

(iv)    any unpaid or deferred ATE premiums;

(c)    the Applicant’s and sample group members’ reimbursement, being compensation and reimbursement for time and expenditure reasonably incurred by the Applicant and sample group members in their representative capacities;

(d)    any stamp duty liability incurred in connection with the settlement deed, including in respect of transactions contemplated by or made under this settlement deed; and

(e)    the costs of the application for the dismissal of the Proceeding following distribution of the Settlement Sum in accordance with the SDS;

(3)    that, to the extent practicable, the costs of the settlement administrator and EY as the expert consultant be paid from interest earned from the settlement sum; and

(4)    distribution of the remainder of the settlement sum, being the residual settlement sum, to group members in accordance with the settlement distribution scheme (SDS) by the First Respondent and Avanteos Investments Limited as settlement distributor.

27 The principles concerning the analysis as to whether it is appropriate to authorise the terms of the settlement are set out below.  It contemplates a return of about 57.5% of the Settlement Sum to group members.  That amount will be distributed amongst approximately 840,000 group members.  The average payment to group members would be approximately $93.20.

Relevant principles

28 The Court is required to form a view as to whether the proposed settlement is fair and reasonable and in the interests of group members (Camilleri v The Trust Company (Nominees) Ltd [2015] FCA 1468 (Camilleri) at [5(a)] and [40]-51; Lifeplan Australia Friendly Society Ltd v S&P Global Inc (formerly McGraw-Hill Financial Inc) (a Company incorporated in New York) [2018] FCA 379 (Lifeplan) at [12]-15).  In Williams v FAI Home Security Pty Ltd (No 4) [2000] FCA 1925; 180 ALR 459 at [19], Goldberg J identified several factors the court may consider in determining whether the proposed settlement is fair and reasonable. Those factors have been considered and applied in a range of cases (see, eg, Prygodicz v Commonwealth (No 2) [2021] FCA 634; 173 ALD 277 at 88; J&J Richards Super Pty Ltd ATF the J&J Richards Superannuation Fund v Nielsen (No 2) [2025] FCA 431 (J&J Richards) at 20).  They have been substantially reflected in Class Actions Practice Note (GPN-CA) at [15.5].  It is well recognised these factors are not exhaustive or prescriptive and that not all need to be considered in each case (J&J Richards at [20]) and that reasonableness is a range, and there is no single way that a settlement should be framed (Newstart 123 Pty Ltd v Billabong International Ltd [2016] FCA 119 (Newstart) at 11).

29 The key factors relevant to the approval of settlement amount are, at their core, concerned with the fairness and reasonableness of the settlement, having regard to the claims made by the group members who will be bound by it (Pharm-A-Care Laboratories Pty Ltd v Commonwealth (No 6) [2011] FCA 277 (Pharm-A-Care) at 21, citing Williams v FAI Home Security Pty Ltd (No 4) [2000] FCA 1925; 180 ALR 459 at 19).  The task of the court is to protect group members, who are not represented by solicitors and counsel, whose interests may be prejudiced by their absence (Lopez v Star World Enterprises Pty Ltd [1999] FCA 104 at [15]-16).  In making that assessment, I am conscious that reasonableness is a range, and it is not the task of the court to second-guess tactical decisions by the applicant provided the court can satisfy itself the settlement is within that range of reasonable decisions in the circumstances (Pharm- A -Care at [22] citing Darwalla Milling Co Pty Ltd v F Hoffman-La Roche Ltd (No 2) [2006] FCA 1388; 236 ALR 322 at 50).

30 In this case, an important consideration is whether the group members were given notice of the essential elements of the scheme in a timely way so they could take steps to protect their position if they wished (Newstart at [14]).

31 The court's supervisory role in an application under s 33V has been described as "important and onerous" and is protective of the interests of group members (McDonald v Commonwealth of Australia [2025] FCA 380 at 119 citing Jenkings v Northern Territory of Australia (No 5) [2021] FCA 1585 at [18]; Australian Securities and Investments Commission v Richards [2013] FCAFC 89 at [8]).

32 The central task of the court is to decide whether a proposed settlement is fair and reasonable in the interests of the group members who will be bound by it, including the interests of the group members inter se. In Webb v GetSwift Ltd (No 7) [2023] FCA 90; 414 ALR 500 at [16], Murphy J identified the task of the Court as being one in which it:

(a)    assumes an onerous and protective role in relation to group members’ interests, in some ways similar to Court approval of settlements on behalf of persons with a legal disability;

(b)    must be astute to recognise that the interests of the parties before it, and those of the group as a whole (or as between some members of the group and other members), may not wholly coincide;

(c)    relatedly to the second point, should be alive to the possibility that a settlement may reflect conflicts of interest or conflicts of duty and interest between participants in the common enterprise which has conducted the representative proceeding;

(d)    should understand that at the point of settlement approval, the interests of the parties will ordinarily have merged in the settlement.  It is likely that they both will have become “friends of the deal”.  As a result, both sides may not critique the settlement from the perspectives of any group members who may suffer a detriment or obtain lesser benefits through the settlement; and

(e)    must decide whether the proposed settlement is within the range of reasonable outcomes, rather than whether it is the best outcome which might have been won by better bargaining.

Consideration

Fairness and reasonableness of the proposed settlement distribution scheme

33 At a high level, the SDS governs the administration and distribution of the settlement sum.  Consistent with the deed, the SDS provides the appointment of the Applicant’s solicitors as settlement administrator, the trustees of the relevant superannuation funds as settlement distributor, and the appointment of Ernst & Young or another independent party as independent expert consultant to assist with calculating a payment amount to each group member in accordance with the apportionment formula.

34 When appointing a settlement administrator, the court will have principal regard to the person or entity who is best placed to administer the settlement scheme efficiently in a cost-effective manner.  It is integral to the approval process that the court is satisfied that the balance of the settlement sum is able to be distributed to group members with minimum cost and maximum efficiency (McKenzie v Cash Converters International Ltd (No 4) [2019] FCA 166; 134 ACSR 327 at [13]).  I note the appointment of the Applicant’s solicitors will not always be appropriate;  however, in some instances, fairness and efficiency of the settlement administration can be enhanced by the appointment of the Applicant’s solicitors because of their involvement in the matter and knowledge of its complexity (see for example, Lifeplan).

35 The proposed role for the solicitors in this case is relatively minor and is largely concerned with communicating with group members and the Court. These matters limit the role of the solicitors and make it more likely to be efficient that they be appointed.  The amount budgeted is said by the contradictor to be “relatively small”, being $374,000, and I accept that characterisation.  In the context of a class action with a class of some 840,000 group members, I consider that cost to be reasonable, and the approach of utilising the solicitors as the scheme administrators as adding to efficiency so as to make the appointment appropriate.

36 The settlement distributor will distribute the residual settlement sum, being the Settlement Sum less the approved deductions, within 30 months of the expiry of the Appeal Period.  The settlement distributor is required to distribute the residual settlement sum as follows:

(1)    if the group member is still a member of one of the CFSIL funds, directly to the member account;

(2)    if the group member has rolled their superannuation into another fund, then by directing the money to that group member's new fund based on their instructions (where they are still available) previously received in rolling out their superannuation;

(3)    if the group member is a "cashed-out member" (meaning they have withdrawn their superannuation in their own name), to their personal account based on the instructions (where they are still available) previously received when the group member withdrew their superannuation; or,

(4)    via a “trustee voluntary payment” to the Australian Tax Office pursuant to the Superannuation (Unclaimed Money and Lost Members) Act 1999 (Cth).

37 An apportionment formula was created with the assistance from the Applicant's actuarial expert, Mr Jeffrey Humphreys.  The formula calculates the notional overcharge attributable to each group member using Mr Humphreys' expert analysis from the substantive proceedings (as set out in his expert reports dated 17 September 2022, 6 October 2022, 2 May 2023 and 25 March 2024) based on each group member's actual premiums paid, type of cover held, fund and the time of premium payment, as is feasible on the data available.

38 The effect of the apportionment formula is to essentially share the available settlement sum between group members in line with Mr Humphreys' expert analysis about the loss that each has suffered.

39 Given the size of the individual claims, there is no process proposed for individual group members to object or challenge the claim amounts.  The contradictor submitted the proposed formula as fair and reasonable, and any more complex process for determining individual amounts payable is likely to be more costly and thereby diminish the amounts actually received by group members.

40 The Applicant has identified two other class actions with an SDS with a similar mechanism, being those approved in Krieger v Colonial First State Investments Limited [2024] FCA 1402 and Coatman v Colonial First State Investments Limited [2022] FCA 1611.  I am satisfied that given the size of the distribution and the size of the group, there is little value in depleting the pool of funds by allowing an objection or appeal process.  Given that the actuarial calculations were part of the basis upon which the case was designed, there is a logic to their involvement in the distribution in this way.  No registration or eligibility process is required.

41 I accept that the proposed SDS is fair and reasonable and in the interests of group members.

Fairness and reasonableness of the proposed settlement

Confidential opinion

42 I have carefully considered the confidential opinion of counsel concerning these proceedings.  That opinion has been provided on a confidential basis, and it is not appropriate to disclose the substance of it for the purposes of this application.  However, having regard to that opinion, as well as the opinions expressed in the affidavits of Mr Allsopp, I am satisfied the settlement is fair and reasonable inter partes. Without being overly detailed, the following factors are relevant:

(1)    The matter has involved significant procedural complexity and cost, with over 27,000 documents discovered, contested discovery applications, and voluminous expert material.

(2)    The subject matter of the proceedings involved complicated issues of fact and law.

(3)    The proceedings raised several novel legal issues and depended on establishing causes of action that have not been often successful in a class action context.  The legal principles continue to evolve, including in Brady v NULIS (No 4) [2024] FCA 1374, which is presently under appeal.

(4)    The proceedings involved a significant degree of uncertainty as to loss, and the potential for partial success, including to truncate the relevant period and reduce the claim value.

(5)    There is significant advantage in the terms of avoiding delay and additional cost of the settlement at this stage, as opposed to achieving an outcome following a trial.

43 I also consider the factors identified by Moshinsky J in Camilleri at [35] to be applicable to the opinion referred to above.  In particular, the proceeding was at a late stage at the time of the proposed settlement, with all evidence filed, placing the parties’ lawyers in a very good position to assess the strengths and weaknesses of the case.  The lawyers who have expressed opinions have been involved in the proceeding for a long time, and the opinions are well-reasoned and expressed.

The reaction of the class.

44 The reaction of the class is relevant, although I note reservations as to the utility of the absence of objections is a useful indicator, identified in Money Max Int Pty Ltd (trustee) v QBE Insurance Group Limited [2016] FCAFC 148; 245 FCR 191 (Money Max) at 50.  On the objection notices received, I make the following observations:

(1)    One objection contained no grounds.  The evidence is that during a telephone discussion between an employee of Shine Lawyers and the objector, the objector stated they did not intend to object to the settlement but to register for it.

(2)    One objection did not include any grounds for objection but said that Shine Lawyers would act for the objector at the settlement approval hearing.  During a call between an employee of Shine Lawyers and the objector, the objector said they did not intend to object to the settlement but to register for it.

(3)    Three objections received included no personal particulars or grounds of objection.

(4)    One objection was an unsigned but otherwise identical version to that discussed at [45(1)] below.

45 The other objections are, in summary, of:

(1)    Travis Malcolm, who objects on grounds that there is insufficient information to group members to assess the settlement or to assess whether the proportion of settlement reaching group members is sufficient, the Funder's commission of 27.5% warrants scrutiny, adverse costs insurance should not be charged to the settlement fund in addition to the Funder's commission, the settlement notice does not comply with GPN-CA, the objection process is unnecessarily more difficult than the opt-out process creating asymmetry that discourages objections, and the absence of an explanation of the rationale for settlement as against proceeding to trial.

(2)    Acktar Allymamode, who objects on the grounds that: “[they] want to receive all of their settlement payment”.

(3)    Nathaniel Stevenson Odusola, who objects on the grounds that the funding commission is excessive and unjust, the funding commission should be calculated on a multiple of costs advanced basis instead of as a percentage of the gross settlement, and there is inadequate disclosure of the funding arrangement to enable informed assessment.

(4)    Elise Stanfield, who objects on the basis she does not know the figure she is owed, or a ballpark figure, after deductions.

(5)    Joanna Mookah, who has provided a blank but signed objection form with an opt-out notice.

46 To the extent the substantive objections have been received, I have considered them in my overall analysis and do not consider they add anything to the analysis which I have carried out for the purposes of this approval.

Proposed settlement: conclusion

47 On balance, and considering all the factors in the cases which I have identified, I am satisfied the proposed settlement falls within the range of fair and reasonable outcomes.

Deductions from the Settlement Sum

48 In summary, the proposed deductions are:

(1)    legal costs and disbursements estimated in the amount of $15,717,695.01, which includes reimbursement of the Funder's legal costs and disbursements and other costs incurred, reimbursement to Shine Lawyers of the balance of the legal costs identified by Ms Rosati as fair and reasonable, as well as an uplift of 25 per cent on the remaining costs payable to Shine;

(2)    a funding commission to the Funder of 27.5% of the Settlement Sum;

(3)    reimbursement for the Funder for amounts incurred or to be incurred in respect of ATE insurance of $4,488,400 (the ATE I nsurance C osts);

(4)    a sum of $20,000 to reimburse the Applicant and $1,000 to reimburse each sample group member;  and

(5)    the reasonable expenses of, and incidental to, the administration process to be carried out in accordance with the SDS.

Legal costs

49 In determining whether to approve the deduction for legal costs and disbursements from the settlement sum, the court must be satisfied the legal costs and disbursements claimed are fair and reasonable in the circumstances, including in relation to the necessity of incurring them at all, and in relation to their proportionality, having regard to the potential outcomes that were anticipated for litigation if it were successful (Levitt v Luke in his capacity as the co-executor of the estate of Luke (Deceased) [2025] FCAFC 79 at 122).  The factors taken into account in determining whether the legal costs and disbursements claimed are reasonable vary from case to case.  Non-exhaustive lists of the factors that may be relevant were set out by Gordon J in Modtech Engineering Pty Ltd v GPT Management Holdings Limited [2013] FCA 626 at [37] and by Moshinsky J in Camilleri at [53].

50 Importantly in this case, the Court must also ensure that what is claimed in legal costs is not disproportionate to the nature of the litigation and the expected benefit.  The assessment looks to the expected realistic return at the time the work was performed (Blairgowrie at [181]).

51 The court can, and in this case has, relied upon expert evidence from an independent costs consultant engaged by the Applicant’s solicitors.  The legal costs and disbursements are only claimed to the extent they have been assessed as reasonable by that independent costs assessor.

52 In more recent years, there has been some consideration given as to whether costs experts engaged by solicitors that act for applicants can be truly independent, or if there is some risk that they can, even unconsciously, become tame experts (see for example Caason Investments Pty Ltd v Cao (No 2) [2018] FCA 527 at [113]; Lifeplan at [40]).  In the context of this case, I am conscious of that risk and have applied a degree of scrutiny to the question of whether the assessment of costs is reliable in the circumstances.

53 In this case, the assessment of the costs assessor is sufficiently clear, detailed and methodical to assist the Court to properly assess the reasonableness of legal costs incurred in the proceeding.

54 The settlement contemplates a deduction of $15,717,695.01 in legal fees, costs and expenses in running the case.  Some of the fees were paid by the Funder and others carried by Shine Lawyers.  There is an uplift of 25% for the legal fees that was not paid by the Funder, and a modest reduction in the overall amount reflecting the conclusions of the independent costs assessor as to what was fair and reasonable.  The fees incurred can be summarised as follows (noting that the fees were updated slightly, relative to the below table, immediately prior to the hearing):

55 The proceeding was on foot since January 2020 and settled close to the trial.  Thus, it lasted more than six years, and involved protracted interlocutory steps concerning discovery, subpoenas, evidence, and the need to replace evidence due to the unavailability of witnesses late in the period of preparation.

56 The costs consultant report concludes that the amounts set out above are the total legal costs and disbursements on a solicitor and own client basis incurred and estimated to be incurred by the Applicant with Shine Lawyers for work done up to and including the settlement approval hearing. It is the opinion of the costs consultant that those costs are “generally appropriate for this representative proceeding” and otherwise fair and reasonable in the circumstances given the scope and complexity of the matter and the stage at which it is settled.  The report concludes that the fees incurred by the Applicant for the experts and consultants are reasonably incurred. That amount included a reduction of 7% in relation to the professional costs incurred by Shine Lawyers up to 31 December 2025 and a reduction of 2.5% to the costs incurred in the settlement approval period of 1 January 2026 to 25 March 2026.

57 I am conscious the amount should not be disproportionate to the nature of the contest, litigation involving an expected benefit (Blairgowrie Trading Ltd v Allco Finance Group Ltd (Receivers & Managers Appointed) (in liq) (No 3) [2017] FCA 330; 343 ALR 476 (Blairgowrie) at 181). One should be careful not to use hindsight bias.  The question relates to the benefit reasonably expected to be achieved, not the benefit actually achieved. Proportionality looks to the expected return on the time at the time the work was performed (Blairgowrie at [181]).

58 In this case, the amounts claimed reflect approximately 11.22% of the Settlement Sum, and the costs assessor asserts this is below the median percentage of settlement proceeds, which are usually between 15-17%.  While the analysis is not a strictly mathematical one, it supports the conclusion that the costs are not disproportionate.

59 The contradictor submitted that:

Overall, we consider the evidence to be sufficient, and of a sufficient quality, as to enable the Court to undertake the assessment that is required of it and to conclude that the fees and disbursements are reasonable.

60 I consider the costs incurred are fair and reasonable in the overall context of this case. In particular, there was significant complexity and detailed work involved in preparing the matter for trial. The matter only resolved shortly before trial, and so virtually no savings were available in terms of preparation prior to the commencement of the proposed trial.

Common fund order and Funder's commission

61 The Funder seeks a common fund order in the amount of 27.5% of the settlement sum by way of Funder's commission.

62 The litigation funding agreement (LFA) provides that, if and only if the proceedings were successful, the Applicant would seek from the court an order that the Funder receive a “success fee” calculated at 27.5% of the gross proceeds.

63 Section 33V of the Federal Court Act provides the court with power to make such an order at the time of settlement (Kain v RandB Investments Pty Ltd [2025] HCA 28; 99 ALJR 1138 at 10; [71]-74; [128]-135, 174; Elliot-Carde v McDonald’s Australia Limited [2023] FCAFC 162; 301 FCR 1 at 170, 423, 504) where the amount sought is a fair and reasonable sum for the litigation funding provided (Hall v Arnold Bloch Leibler (No 2) [2022] FCA 163 at 24).

64 The considerations relevant to whether an order should be made are identified in Money Max at [80]. Of the factors there identified, the following are relevant to this proceeding:

(1)    the legal costs expended and to be expended, and the security for costs provided, by the Funder;

(2)    the litigation risks of providing funding in the proceeding, recognising that the Funder took on those risks at the commencement of the proceeding;

(3)    a comparison of the funding commission with funding commissions in other Part IVA proceedings;

(4)    the quantum of adverse costs exposure that the Funder assumed;

(5)    the amount of any settlement or judgment, where it is important to ensure that the aggregate commission received is proportionate to the amount sought and recovered in the proceeding and the risks assumed by the Funder;

(6)    the information provided to group members as to the funding commission; and

(7)    any substantial objections made by group members in relation to any litigation funding charges.

65 It should be noted that recent decisions of this Court have cautioned against affording too much weight to funding commissions approved in other cases (Galactic Seven Eleven Litigation Holdings LLC v Davaria [2024] FCAFC 54; 302 FCR 493 at 89).

66 I am satisfied the evidence establishes that the Funder has, since January 2020, paid a significant amount to fund the Applicant's legal costs and disbursements, and the matter would unlikely have continued without their support.  The Funder has carried risk in this proceeding since 2020.

67 In addition, the LFA expressly contemplates the Applicant would seek a common fund order at the time of any settlement approval.  Thus, the mechanism may be viewed as one of the factors taken into account by the Funder in deciding to fund litigation.  Of course, all Funders take on litigation funding with the knowledge that it is a matter for the court as to whether or not the order is approved, but it is nonetheless an appropriate factor to consider.

68 I accept that in the circumstances of this case, the evidence supports the conclusion that it would have been less economically or logistically viable to pursue the claim on a closed class action, because of the size of the class and the relatively small claim value of each individual.  I therefore accept that a common fund order is an efficient and transparent mechanism in the circumstances of this case.

69 I am satisfied the group members have been appropriately informed of the orders that are sought, and I have already considered the objections that have been received.  I do not consider that any of the objections raise an issue that ought to be a barrier to approval.

70 Finally, I am satisfied the Funder undertook risks in supporting the proceeding, including adverse costs indemnity.  The nature of the risk is underscored by the matters that are set out in the confidential opinion to which I have had regard.

71 Overall, I consider the Funder’s commission of 27.5% is appropriate having regard to all of those factors.

ATE insurance

72 A policy of ATE insurance was obtained on 20 March 2020 to cover adverse costs the Applicant and/or the Funder were ordered or agreed to pay to the Respondents in the proceedings.  This policy was obtained:

(1)    to provide additional protection against adverse costs; and

(2)    to assist the provision of security in the proceedings, which is provided by way of deeds of indemnity from the ATE insurer.  Absent the ATE insurance, it would not have been possible to provide security for costs in this way.

73 Substantial premiums have been paid upfront for the policy and an amount is payable as a deferred contingent premium that is now due and will be payable to the insurer. The total cost of the ATE insurance is $4,488,400.

74 The Funder argues that obtaining ATE insurance has provided significant value to group members because it has allowed security for costs to be provided by way of deeds of indemnity from the insurer. Moreover, the Funder asserts that without ATE insurance, providing this substantial security for costs in this way would not have been possible.

75 There is authority for the proposition that it is not reasonable to reimburse a litigation funder for the cost of ATE insurance out of settlement proceeds, on the basis that the funding commission claimed would be expected to cover all of the funder's costs, including in respect of the risks of an adverse costs (Court v Spotless Group Holdings Ltd [2020] FCA 1730  at 96; Evans v Davantage Group Pty Ltd (No 3) [2021] FCA 70 at 84; Bradshaw v BSA Limited (No 2) [2022] FCA 1440 at 161).  There is also authority to suggest that one should assess a settlement proposal that entitles a funder to both a funding commission and the costs of ATE insurance in a more holistic way, considering whether the combined amount of the proposed funding commission and the ATE insurance cost is so high that the proposed settlement would be reasonable and proportionate unless the amounts were reduced (Ghee v BT Funds Management Ltd [2023] FCA 1553 (Ghee) at [150]).

76 The Funder advances three core arguments in oral submissions as to why it is appropriate to have the cost of ATE insurance:

(1)    First, it said that the ATE insurance reduces the costs to group members. It is asserted that if security for costs had been provided by way of a bank guarantee or by paying a sum into Court, then the cost of placing security would have involved an additional cash outlay that was not anticipated, such that the Funder would have required a higher return, including to reflect any additional capital tied up as security in the proceeding.  It is said that the ATE insurance has likely resulted in the proceeding being funded at a lower overall cost to group members than would have been the case without it, and some evidence has been adduced to support that proposition.

(2)    Second, it is said that the ATE insurance cost is a relatively modest sum which was contemplated at the time the funding agreement was entered into and did not completely remove the risk that the Funder undertook in funding the proceeding.  The Funder retained considerable exposure.

(3)    Third, it is said that the prospect of paying for the ATE insurance was disclosed to group members, and it said this is a factor which weighs in favour of approving the amount.

77 However, ultimately, having considered the matter carefully, I do not accept these arguments.  The Funder will receive a very significant return on its investment, and the justification for that return is in large part the risk that it accepted by funding the proceeding.  A central obligation of a Funder is to provide an indemnity against adverse costs (Ghee at [147]).  The ATE insurance significantly reduced those risks. The risk was also less in the sense that Shine Lawyers itself took on part of the risk of carrying its own fees for which it received an uplift fee.

78 If the Funder were to receive a 27.5% commission on the gross proceeds and reimbursement of ATE insurance premiums, its effective return would be, I accept, 30.7%.  The contradictor submits, and I agree, this amount is disproportionate to the risks incurred by the Funder in the context of this specific proceeding.

79 To the extent it is said the ATE insurance costs represent a small proportion of the overall settlement sum, being approximately 3.2% of the gross settlement sum, I do not accept that this is an insignificant amount in and of itself.  However, in the context of the funds being received by the Funder, I do not consider it is such a significant amount that it would have radically altered the cost-benefit analysis of funding the proceeding or have increased the cost of doing so to such an extent to justify increasing the return.

80 The contradictor in this respect submitted:

Having regard to the reasons set out at paragraphs 56 to 64 above in relation to the funding commission sought and the risks incurred by the Funder, it would be open to the Court to conclude that the combined amount of the funding commission and the ATE Insurance Costs is too high as to be fair and reasonable.

That is so because, in circumstances where the Funder was only ever contractually [REDACTED] and the adverse costs of the proceeding (if they arose), and the latter was offset by ATE insurance, an aggregate payment to the Funder of 30.7% of the Settlement Sum sought in addition to the reimbursement of the legal costs and disbursements it has paid for would be disproportionate to the risks incurred by the Funder in the proceeding.

81 With respect, I agree with that analysis.  I consider the preferable outcome is to award the 27.5% Funder's commission but not to approve a distribution in respect of ATE insurance premium.

Applicant's costs and expenses

82 The Applicant claims an amount of $20,000 as compensation for time spent representing the interests of the group.  This is “standard payment that has been made in a very large number of cases, to compensate an applicant for the time the applicant has spent representing interests other than his or her own” (Dillon v RBS Group (Australia) Pty Limited (No 2) [2018] FCA 395 at 72; Janssen v OnePath Custodians Pty Ltd (No 2) [2026] FCA 291 at [203]-[205]).

83 The contradictor expressed some concern the amount was on the higher side. However, I am satisfied that an individual exposing themselves to the rigours of litigation on a one-off basis ought to be fairly compensated for the time and effort involved in that process as well as the emotional toll taken by involvement in contested and complex litigation.  I do not consider the amount is excessive, and I therefore approve it.

Sample group member compensation

84 Each sample group member claims an amount of $1,000 as compensation.  Their involvement involved a few initial conferences and limited contact thereafter.  The amount includes payment to Mr Ronny Ahmajani, who passed away and was replaced by Mr Matthew Webber on 23 July 2025.  This amount is modest, and is appropriate recognition for the time and effort involved in the proceedings.

Settlement administration costs and payment of stamp duty on the deed

85 The Applicant’s solicitors have estimated the costs of the settlement administrator to be $374,226.37 (including GST).  The estimate is based on an administration duration of 30 months, having regard to, amongst other things, the role of the settlement distributor as the point of all communications with group members during the administration of the SDS.

86 Clause 16.9(a) of the deed provides the Applicant must pay stamp duty in respect of the deed, and, as set out in the First Allsopp Affidavit, the Applicant has incurred $1,494 in stamp duty and related fees.

87 These amounts are appropriate having regard to the size and complexity of the administration as well as the 30-month length, and I approve them.

OTHER ORDERS

Confidentiality orders

88 The Applicant and the Funder seek confidentiality orders over portions of the First, Second and Third Allsopp affidavits and the Morris Affidavit and parts of their exhibits, and various parts of the written submissions.  There are four categories of non-publication orders sought:

(1)    Information until the grant of the approval to avoid the disclosure of information that could provide the Respondents a tactical advantage if the claim were to proceed.  An order in respect of this material is sought until the appeal period lapses.

(2)    The Applicant's legal advice and privileged communications shared with the Funder on a common interest basis.

(3)    Inter partes without prejudice and confidential communication contained in the deed poll and heads of agreement.

(4)    Commercially sensitive information of value to Shine Lawyers or the Funder which may confer a tactical advantage about how Shine Lawyers and the Funder operate their businesses.  This order is sought for three years or until further order and is confined between non-parties and respondents.

89 It is recognised that "necessary" in 37AG(1)(a) of the Federal Court of Australia Act 1976 (Cth) is a strong word and non-publication orders should not be overly broad.  However, it is also well established that such orders are appropriate in relation to legal advice and without prejudice communications provided to the court in connection with the settlement approval application.

90 In respect of category 4, I accept the proper conduct of a complex class action litigation requires specialised knowledge and experienced litigation funders, and services provided by funders should not be impeded by the loss of confidentiality that may provide competitors for provision of these services, or actual or potential respondents to class actions, with an unfair advantage. In the course of the hearing, it was accepted that there is no need for those orders to be made for all time, noting the divergence of authority as to whether a non-publication order can be expressed to operate “until further order” (Australian Securities and Investments Commission v Ferratum Australia Pty Ltd (in liq) [2023] FCA 1043 at [60]-66; Deputy Commissioner of Taxation v Peever [2025] FCA 460 at 66).  The orders are now sought for a period of three years to the extent they concern commercial sensitivity, and I will confine any order in respect of category 4 in that way.  I am otherwise satisfied that the orders sought are appropriately confined and meet the threshold imposed by s 37AG.

Return of security for costs

91 The deed provides for a vacation of security for costs orders and the return of funds previously paid into Court by way of security.  The order is sought by consent, and I have no difficulty granting it.

Joinder of Avanteos Investments Limited

92 Clause 5.2(a)(iii) of the deed contemplates the joinder of Avanteos Investments Limited as a respondent.  Avanteos Investments Limited replaced the First Respondent as trustee of the CFSIL Funds on 30 May 2022, and that proposed order is sought by consent of the parties and with the consent of Avanteos Investments Limited.  It is sought in facilitation of the appointment contemplated by the SDS, and it is appropriate to make the order.

Validity of opt-out

93 An order is also sought to permit certain group members to opt-out of the proceeding despite late provision of opt-out notices.  Those orders are not opposed, and I have power to make those orders under 33J(3).  There were some procedural complexities in identifying all of the opt-out notices. In circumstances where the orders are not opposed, and the delay is limited, I am content to make the orders sought.

94 The balance of the orders sought are procedural and are not controversial.

| I certify that the preceding ninety-four (94) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Bennett. |
Associate:

Dated: 17 April 2026

SCHEDULE OF PARTIES

| | VID 28 of 2020 |
| Respondents | |
| Fourth Respondent: | AVANTEOS INVESTMENTS LIMITED |