Montara oil spill settlement gets $192 million approval

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This was an application to approve a proposed settlement in the Montara oil spill class action. Because of the unprecedented situation of the lead applicant supporting the proposed settlement but, represented by separate legal representatives, seeking to oppose the legal costs claimed by his own solicitors (which Lee J described as “a form of litigious dissociative identity disorder” (at [3])), this judgment was confined to approval of the settlement itself, and did not deal with approval of the proposed deductions from the settlement sum.

The total settlement sum was $192.5 million, which his Honour had no hesitation in approving. Although the approval of any deductions from that sum was to be determined at a later hearing, his Honour considered that such bifurcation of the settlement approval process in this particular case was appropriate because it was “possible to form a view that the proposed settlement is of such a character as to commend settlement, irrespective of the precise quantum of funds which will be approved by the Court as just deductions from the proceeds of any judgment or settlement sum” (at [19]ff). That view was supported by the funder’s undertaking not to seek a funding commission greater than 30%, and not to seek recovery of ATE insurance premiums paid by it.

Following approval of the settlement, his Honour made an order substituting a different person as lead applicant in the proceeding, in order to cure the ‘litigious dissociative identity disorder’ and enable the original lead applicant to oppose, at a later hearing, approval of the legal costs.

Sanda v PTTEP Australasia (Ashmore Cartier) Pty Ltd (Settlement Approval) [2023] FCA 143

Federal Court of Australia, Lee J,
23 February 2023

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

Austlii link

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