Global search

Primary navigation

This is a closed class action on behalf of 15,482 Indonesian seaweed farmers, whose crops were allegedly destroyed when oil from an oil spill at the Montara oil field operated by the respondent spread to the southern coastal area of Rote, Indonesia, in 2009. In March 2021, following an initial trial of the proceeding, Yates J delivered judgment in favour of the applicant: Sanda v PTTEP Australasia (Ashmore Cartier) Pty Ltd (No 7) [2021] FCA 23. The respondent filed an appeal from the judgment, but it was vacated after the parties reached an in-principle agreement to settle the proceeding for $192.5 million.

When the matter came before Perram J to set the procedural steps for the hearing of the settlement approval application, it came to light that no date had been fixed by the Court for class members to opt out of the proceeding and no opt out notice had been sent to class members, as required by ss 33J(1) and 33X(1) of the Federal Court of Australia Act 1976 (Cth) (FCAA), respectively. His Honour observed that, in closed class actions, such as the present case in which all class members had executed funding agreements, “the practical need for an opting out procedure retreats” (at [12]). However, his Honour said that the fact is that Pt IVA requires an opt out date to be set and opt out notices to be distributed to class members, regardless of whether the class is open or closed.

The first matter his Honour addressed was whether s 33ZF of the FCAA can be used to dispense with the obligations to fix an opt out date and/or notify class members of that date. His Honour observed that there is authority that s 33ZF extends to dispensing with the need to send an opt out notice: see Vernon v Village Life Ltd [2009] FCA 516 per Jacobson J. However, there is authority that the relevantly identical power in the Civil Procedure Act 2005 (NSW) does not so extend: TW McConnell Pty Ltd as trustee for the McConnell Superannuation Fund v SurfStitch Group Ltd (subject to deed of company arrangement) (No 3) [2018] NSWSC 1749 (TW McConnell) per Stevenson J. His Honour agreed with the conclusion reached by Stevenson J in TW McConnell, and found that the general power in s 33ZF cannot be used to outflank the detailed scheme set out in ss 33J and 33X for the fixing and notification of the opt out date. In doing so, his Honour cited with approval the following statement by Gavan Duffy CJ and Dixon J in Anthony Hordern and Sons Ltd v Amalgamated Clothing and Allied Trades Union of Australia (1932) 47 CLR 1 at 7:

When the Legislature explicitly gives a power by a particular provision which prescribes the mode in which it shall be exercised and the conditions and restrictions which must be observed, it excludes the operation of general expressions in the same instrument which might otherwise have been relied upon for the same power.

His Honour was therefore required to fix an opt out date. However, his Honour observed that the combined effect of the procedural history of the proceeding and the requirements of Pt IVA of the FCAA created an “intractable” problem. First, Pt IVA requires that an opt out date be set in the future. That conclusion follows from the right conferred on class members by ss 33J(2) and 33X(1)(a) of the FCAA to opt out of a class action before the opt out deadline. Second, Pt IVA assumes that opting out will have occurred before judgment. That conclusion is apparent in s 33ZB of the FCAA, which provides that a judgment in a representative proceeding: (a) must describe or identify the class members affected by it; and (b) binds all such persons other than any person who has opted out.

Therefore, his Honour concluded that Pt IVA required him to fix an opt out date that was: (a) in the future; and (b) before the date of judgment given in the proceeding. However, satisfying those two requirements was impossible, because judgment had already been given in March 2021.

Ultimately, the parties proposed a work-around. The Court would set aside the March 2021 judgment, fix an opt out date in the future and, at the time that the settlement approval application is eventually heard, make a fresh s 33ZB judgment. His Honour accepted that solution, and observed (at [24]):

This solution solves the problem. The opt out date is fixed in the future, notices can be sent under s 33X(1) and a meaningful right to opt out is afforded to group members. At the same time, s 33ZB is not offended because no s 33ZB judgment is in place.

Sanda v PTTEP Australasia (Ashmore Cartier) Pty Ltd (Opt Out Obligations) [2022] FCA 1409

Federal Court of Australia, Perram J,
24 November 2022

Applicant’s Solicitors: Maurice Blackburn
Respondent’s Solicitors: Allens
Applicant’s Funder: Harbour Fund II, L.P.

Austlii Link: Available here

Go back to Class Actions Landscape Australia

Learn more about our class actions work

We're Australia's leading class action practice, and we've obtained more than $4.2 billion in settlements for our clients. 

It doesn't cost you anything to know where you stand 

Office locations

We’re here to help. Get in touch with your local office.

Select your state below

We have lawyers who specialise in a range of legal claims who travel to Australian Capital Territory. If you need a lawyer in Canberra or elsewhere in Australian Capital Territory, please call us on 1800 675 346.

We have lawyers who specialise in a range of legal claims who travel to Tasmania. If you need a lawyer in Hobart, Launceston or elsewhere in Tasmania, please call us on 1800 675 346.