Funding the costs of a class action

Class actions regularly run over several years and cost millions of dollars to run successfully - often upwards of $10 million. We work hard to ensure you will never have to contribute to the cost of running your case until you’ve successfully recovered compensation.

Not only will you never have to dig in to your own pockets, but your total contribution to a successful case will never exceed your recovery amount.

We believe a key to increasing access to justice is to break down the cost barriers to bringing important cases. In order to help all Australians that have suffered harm from mass wrongdoing, we provide better cost options to help you access your legal rights. 

Here’s how we are able to run these complex and expensive cases without imposing cost burdens on you along the way:

1.     ‘No win, no fee’ (no win – no charge) costs

If your case is run on a 'no win, no fee' basis, you will not be exposed to any out-of-pocket costs. Our professional fees will be deferred until the conclusion of the case and will never exceed the amount you receive. In a class action, even if the case is unsuccessful, we will not charge you for the costs of running the action. Generally, a 'no win, no fee' action will be charged on a traditional hourly basis, rather than as a percentage of the settlement.

2.    Group Costs Orders (also known as contingency fees)

A Group Costs Order (GCO) permits law firms acting for plaintiff(s) and group members to recover their legal costs as a percentage of the amount of any award or settlement in the proceeding. Group Costs Orders provide transparency, simplicity, and certainty about the amount of legal costs payable. For example, you know that on a 75/25 split of recovery and costs that you as a client will recover 75% of the total settlement and that no more than 25% of your recovery will contribute to the case’s costs.

3.    Litigation funding

Occasionally we will use third-party litigation funders to help fund the costs of a class action. In this scenario, both the litigation funder and the law firm will recover their fees from the resolution sum. The amount that group members contribute to legal costs will never exceed your share of the compensation, so you will not have to pay any out-of-pocket costs. 

What are the main differences between the 'no win, no fee' model and a Group Costs Order?

The main difference is that a Group Costs Order (GCO) provides greater transparency, simplicity, and certainty about the amount of legal costs payable if a successful result is achieved. A GCO permits law firms acting for plaintiff(s) and group members in representative proceedings to recover its legal costs as a percentage of the settlement amount. A GCO provides a clear percentage to group members, both from a legal costs payable perspective, and for the amount to be recovered by group members.

A 'no win, no fee' (NWNF) model is based on more traditional methods of legal costs billing, and as such, can vary depending on the length and complexity of the proceeding, and  whether the proceeding goes to trial.

What about when there's litigation funding required?

In a circumstance where litigation funding is required, overall costs are generally higher and recoveries to clients are generally lower compared to the other two methods. This is because the litigation funder also requires its fees in return for taking on the risk of financing the case (so that clients don’t have to do that upfront), as well as the lawyers recovering their legal fees.

While a GCO or NWNF model will generally return more to clients in a successful case, it should be noted that litigation funding plays an important role in enabling cases to proceed that would otherwise not be able to run. As with the GCO and NWNF options, the amount you receive upon success will always exceed any payment contributions you have to make to both the lawyers and litigation funders.

These three common options all play an important role in ensuring that everyday people can band together and take on large, powerful and well-resourced organisations that are alleged to have caused mass harm.