The Third Party Litigation Funding Law Review 7th edition: New Zealand

02 JANUARY 2024 BY JASON GEISKER & SIMON GIBBS

Introduction

New Zealand is home to an evolving third party litigation funding market, although it remains a small and comparatively new industry, particularly when compared with similar common law jurisdictions such as Australia and Canada. It was not until the turn of the millennium that third party litigation funding appears to have first emerged in New Zealand.² Prior to that time, no-win no-fee or speculative fee arrangements had been a feature of the New Zealand legal landscape and had even been said to be 'consistent with the highest professional honour'.³

In 2021 the New Zealand legal services market was worth an estimated NZ$3.3–NZ$3.9 billion in annual revenue.⁴ The litigation-related portion of that overall market had an estimated NZ$330 million in revenue, with the addressable market for third party litigation funding considered to be two-thirds of that, or approximately NZ$220 million in annual revenue terms.⁵ As such, given the paucity of cases⁶ that have reportedly received funding over the past two decades, third party litigation funding appears significantly under-utilised in New Zealand.

The market for litigation funding is influenced by a range of factors including the general awareness of the availability of funding, uncertainty as to regulatory requirements, an absence of explicit endorsement of litigation funding by the courts, delays in introducing a comprehensive set of procedural rules for the conduct of representative actions and a lack of significantly sized dedicated plaintiff law firms with experience sufficient to take advantage of litigation funding. Various macroeconomic factors also impact on the strength of the local economy with consequential impacts on the demand for legal services and the number of potential claims meeting the threshold criteria required for commercially viable funded claims. Looking ahead, the legal services market is projected to see a slow return to growth, averaging 2.2 per cent per annum over the next few years, to arrive at a predicted NZ$4.4 billion in annual revenue by 2027.⁷ The litigation funding market is expected to grow at least in line with these broader trends.

Given the relatively small size of the market and the fact that third party litigation funding arrangements are not generally disclosed,⁸ precise data as to the extent of third party litigation funding is expected to remain difficult to come by.

In terms of market participants, for many years, third party litigation funding options were somewhat limited, with the local incumbent funder, LPF Group Ltd,⁹ facing little in the way of competition.¹⁰ However, more recently, other experienced and well-resourced funders have entered the market. These include Claim Funding Australia,¹¹ Omni Bridgeway,¹² Litigation Lending Services¹³ from Australia and Harbour Litigation Funding from England.¹⁴ Most funders in the market require a minimum claim size of between NZ$2–NZ$5 million before they will consider funding applications.¹⁵ Some funders also require a minimum claim value to claim budget of 10:1.¹⁶

In its 2020 issues paper on Class Actions and Litigation Funding the New Zealand Law Commission (NZLC) identified a total of 40 examples of cases brought in the jurisdiction where the plaintiff had received litigation funding.¹⁷ This collection of third party funded cases included 10 representative actions under High Court Rule 4.24, comprising five consumer claims, three shareholder claims, one investor claim and a claim against the government.¹⁸ The NZLC has also identified at least 11 insolvency cases that have received third party litigation funding,¹⁹ and at least 15 insurance claim cases²⁰ that have also received third party funding. Third party funding has also assisted in cases concerning negligence and breach of fiduciary duty,²¹ statutory demands for repayment of a loan,²² a relationship property claim²³ and a land claim.²⁴

In May 2022, the final report of the NZLC on Class Actions and Litigation Funding (NZLC R147) declared that, consistent with recent judicial observations, third party litigation funding is desirable for New Zealand 'in principle'.²⁵ The report concluded that litigation funding has an important role to play in improving access to justice in New Zealand, including by alleviating the costs and risks of litigation.²⁶ Even those opposed to litigation funding in the jurisdiction acknowledge that it is now here to stay.²⁷

As discussed in this chapter, after a decade of inaction, the NZLC's report has certainly paved the way for legislative change to allow more certainty, efficiency and structure for those seeking to utilise the benefits of third party litigation funding services to obtain access to justice. Indeed, in August 2023, the Hipkins Labour government committed to adopting the NZLC's recommendations to enact a statutory regime for class actions and litigation funding if re-elected for another term.²⁸

The year in review

The past year has been marked by a common dynamic in legal policymaking: the incremental development of common law in the absence of proactive action on reform. The ambitious reform agenda laid down by the NZLC R147 appears to have, momentarily, lost momentum, which may be explained by a confluence of factors and competing priorities besetting New Zealand policymakers, resulting in litigation funding and class action reforms being de-prioritised. However, the common law jurisprudence has continued to mature in the absence of top-down policy reform.

i The Trans-Tasman dynamic – A2 Milk class action and Koper v. Zurich

This year has seen an increase in litigation utilising the Trans-Tasman Proceedings Act 2010 (TTPA). The TPPA is part of the reciprocal legislation regime between New Zealand and Australia that is designed to streamline processes for managing and resolving civil and criminal proceedings, where proceedings involve a 'trans-Tasman element'.²⁹ The aim of this regime is to reduce the costs associated with litigation, improve efficiency and minimise the existing barriers to enforce judgments and regulatory sanctions between the two countries.³⁰ The TTPA regime is underpinned by a treaty between New Zealand and Australia, which entered into force in October 2013.³¹ The historical function of the TTPA has been to facilitate procedural matters between the jurisdictions, such as the service of documents, issuance and enforcement of subpoenas, facilitation of remote appearances and registration and enforcement of judgments, inter alia. The decisions in the A2 Milk class action³² and Zurich v. Koper³³ series of proceedings have clarified and arguably expanded the scope of the TTPA in relation to the jurisdictional reach of foreign law, forum selection and management of concurrent representative proceedings.

A2 Milk class action

The A2 Milk class action (A2 NZ)³⁴ is a recent example of New Zealand courts having to engage on the issue of concurrent class claims in New Zealand and Australia. In a decision handed down in January 2023 in Whyte v. The a2 Milk Company Limited [2023] NZHC 22 the High Court examined the case-management principles attendant to multiplicity of proceedings and the jurisdictional complexities of litigation involving dual-listed public companies with operations in New Zealand and Australia. The decision (examined below) represents the first application of the TTPA to class proceedings and a novel finding, in that context, that Australian courts are competent to apply New Zealand law.³⁵

The A2 NZ is a shareholder claim filed in the Auckland High Court alleging that the company breached continuous disclosure obligations and made false, misleading or deceptive statements to the Australian Stock Exchange (ASX) and the New Zealand Stock Exchange (NZX) in relation to its forecast revenue and earnings. There is a concurrent Australian shareholder class action against A2 Milk in the Supreme Court of Victoria (A2 AUS).³⁶ Both proceedings allege materially similar claims against A2 with the distinction that the A2 AUS claim alleges breaches of both New Zealand and Australian law, while the A2 NZ claim only alleges breaches of New Zealand law. On 23 January 2023 the New Zealand High Court handed down a judgment in the A2 NZ proceeding that:

1. granted leave for the A2 NZ claim to commence an opt-in representative proceeding; and
2. stayed the A2 NZ proceeding pursuant to the TTPA, with immediate effect, pending delivery of a judgment on liability in the A2 AUS proceeding, or final settlement of that proceeding, whichever occurs first.³⁷

The decision is relevant for many reasons, including that it is the first time a New Zealand court has applied the TTPA to a class action; it is the first reported judicial guidance on concurrent class actions filed in both jurisdictions; and it is novel insofar as it affirmed the power of a foreign court to determine issues and grant relief by applying New Zealand domestic law.³⁸

Stay of proceedings

The power to order a stay arises under Section 24 of the TTPA, which enables a New Zealand court to stay a domestic proceeding in circumstances where it is satisfied that an Australian court (1) has jurisdiction to determine the matters in issue between the parties to the proceeding; and (2) is the more appropriate court to determine those matters.³⁹ The factors the court is required to consider in making this determination are enumerated in Section 24(4) of the TTPA, and involve a multifactorial assessment. The power to stay the New Zealand proceeding is ultimately at the discretion of the court after completing the multifactorial assessment. The existence of the concurrent Australian claim was determinative in reaching the conclusion that the A2 NZ proceeding should be stayed,⁴⁰ with multiplicity of proceedings, case management considerations and avoiding duplication of costs and judicial resources the most persuasive factors in favour of granting the stay.⁴¹ The disposition of the High Court on this point was the subject of extensive analysis⁴² but may be pithily captured by the following statement by Edwards J:

A multiplicity of proceedings raises a multiplicity of issues. These include duplication in costs and resources for the parties and for the courts in each jurisdiction, and the 'scandal' of inconsistent judgments.⁴³

Concurrent class actions

In practice, New Zealand courts have erred in favour of a preference to stay or consolidate competing claims, reflecting the orthodox view that 'having competing class actions relating to the same dispute is generally undesirable'⁴⁴ with the caveat that the response to multiplicity will ultimately depend on the circumstances of each proceeding.⁴⁵ The judgment in Whyte v. The a2 Milk Company Limited identified three broad categories of concurrent proceedings.⁴⁶ This analysis is likely to be highly instructive of how New Zealand courts in the future will categorise and address concurrent claims both under the TTPA and in general.⁴⁷ The analysis relied heavily on Australian case law to explore the principles of interpretation relevant to resolving multiplicity issues, which involve a panoply of procedural tools to manage these proceedings, such as: consolidate the proceedings; stay all but one; change the class structure of one proceeding (e.g., from an opt-out to an opt-in proceeding);⁴⁸ and 'de-class one or more of the proceedings; hold a joint trial of all proceedings with each left constituted as opt-out (open class) proceedings; and close the classes in one or more of the proceedings (that is, making them opt-in) but leave one of the proceedings as an opt-out proceeding with a joint trial of all.'⁴⁹

Both the A2 NZ and A2 AUS proceedings were funded and the funding arrangements in place were adjudged to be a neutral factor in the multifactorial analysis to order a stay, on the basis that the contractual arrangements were 'broadly comparable' between the proceedings⁵⁰ and the effect of a stay practically conferred a choice upon class members as to which proceeding they would participate in (by opting out of one). Therefore, any prejudice potentially caused by the funding arrangements were 'matters for the plaintiffs to assess and determine for themselves'.⁵¹ Although this conclusion reflects a continued cautiousness of New Zealand courts not to look behind funding arrangements, it is perhaps more accurately a reflection of the fact that the funding arrangements were not interpreted as germane to the question of law before the court, namely whether the Australian court was the more appropriate court to determine the claims for the purpose of granting a stay.⁵²

Ultimately, the court determined that the proceedings fell within the third category of concurrent proceedings⁵³ and considered that the practicalities arising from the jurisdictional differences and hazard of competing judgments could not be sufficiently ameliorated through parallel case management so as to justify both proceedings remaining on foot.⁵⁴ Accordingly, the A2 NZ proceeding was stayed.

Competence of a domestic court to apply laws of another jurisdiction

A striking feature of the decision in A2 NZ, and cognate decision of the Australian court in relation to the A2 AUS proceeding,⁵⁵ is that they interpret the conflicts of law doctrine in a manner that may increase the opportunity for trans-Tasman litigation. In particular, the A2 NZ decision elevates the special relationship between New Zealand and Australia under the TTPA and is likely to be instructive of how a New Zealand court may make procedural determinations, interpret and resolve substantive questions of law that have a 'trans-Tasman element'.⁵⁶

Both proceedings were substantively similar.⁵⁷ However, the fact that the A2 AUS proceeding pleaded causes of action under both Australian and New Zealand law was persuasive (as opposed to the A2 NZ proceeding, which advanced claims for both NZX and ASX investors but only under New Zealand law). The first question for the court to determine under Section 24(1) of the TTPA is 'Does the Australian Court have jurisdiction to determine the matters in issue between the parties to the proceeding?' The court reframed this question in the following terms: 'The issue is the jurisdiction of the Australian Court to determine claims brought by New Zealand shareholders who acquired shares on the NZSX.'⁵⁸ It concluded, with a paucity of supporting reasoning, that 'plainly the Australian Court would, and does, have jurisdiction in this case.'⁵⁹ The economy of reasoning given by the New Zealand High Court is perhaps a reflection of the nature of the special relationship under the TTPA and the exhaustive reasoning of Button J of the Victorian Supreme Court in the A2 AUS case (on which the High Court relied and agreed).⁶⁰ In making its finding, the New Zealand High Court held:

[68] There is no dispute about the competence and capability of the New Zealand and Australian courts to apply each other's laws. That is a given under the TTPA. Nevertheless, in determining whether the Australian Court is the more appropriate court to determine the matters in issue in the proceeding, this Court must take into account the law that would be most appropriate to apply. The underlying premise of the subsection is that New Zealand courts are best placed to apply New Zealand law, and Australian courts are best placed to apply Australian law. However, having concluded that both New Zealand and Australian law applies to this dispute, this factor does not significantly advance the enquiry in this case.
[69] Given the trans-Tasman context of the dispute, I do not consider one law to be more appropriate than the other. The laws of both countries apply equally, rendering this factor neutral in the overall balance.

Understanding this conclusion requires an understanding of the Australian decision in the A2 AUS proceeding (Victorian Supreme Court decision Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725), which the New Zealand court relied on to conclude that the Australian court had jurisdiction to apply New Zealand law. A brief description of the key findings of the Victorian Supreme Court decision are provided below, so as to better understand how the New Zealand High court came to its consequential finding.

The Victorian Supreme Court was asked to decide three questions as part of an interlocutory process in the A2 AUS proceeding. These questions were (paraphrased):

1. Question 1: Does the Supreme Court have jurisdiction to determine claims made under New Zealand statute? Answer: Yes.⁶¹
2. Question 2: Are those claims enforceable in the Supreme Court of Victoria. Answer: Yes.⁶²
3. Question 3: Does the Supreme Court have the power to award compensation under New Zealand law. Answer: Yes.⁶³

We highlight relevant aspects of the answers to Questions 2-3 below. The answer to Question 1 turns on an interpretation of Australian constitutional law that is not germane to the New Zealand scope of this chapter.

1. Question 2: The Victorian Supreme Court found that an Australian court can apply New Zealand law in adjudicating claims involving litigants over which it has effective jurisdiction.⁶⁴ Whether the Court had 'effective jurisdiction' turned on whether New Zealand courts have exclusive jurisdiction over their own laws. This question was determined by a close textual analysis of the statutes in question⁶⁵ to establish whether they conferred exclusive jurisdiction on domestic New Zealand courts (i.e., to the exclusion of all other courts including foreign courts) or whether the statute does no more than provide for the distribution of jurisdiction domestically as between local courts.⁶⁶ If the latter, then there is no exclusive jurisdiction and no barrier to a foreign court hearing claims under that statute.⁶⁷ The Court found that the latter construction applied⁶⁸ in reliance on its own determination,⁶⁹ and expert evidence from New Zealand senior counsel⁷⁰ that was not contradicted.⁷¹ The Australian court accepted the broad principle expressed by the New Zealand High Court in Rimini Ltd v. Manning Management & Marketing Ltd, that 'Where a statute does not expressly or by clear implication exclude its application by foreign Courts, it must be open for foreign Courts of similar standing to apply it, subject to the ordinary limitations of private international law.⁷² The position at law in New Zealand was cogently expressed by New Zealand law expert Ms Cooper KC in her opinion, which noted the paucity of New Zealand cases on the issue of foreign courts to applying domestic law.⁷³
2. Question 3: The power to grant relief (as opposed to liability) is perhaps one of the more consequential findings. The Victorian Supreme Court framed this power as part of the 'choice of law' question, namely whether the power to award compensation was a matter of substantive law or procedural law.⁷⁴ This distinction can be slippery and, as the High Court of Australia has observed, the distinction between these concepts is often elusive.⁷⁵ The controversy that lies in this distinction is that substantive matters of law are determined by the lex causae (i.e., the governing law, which was assumed to be New Zealand law) and procedural matters are typically determined by the lex fori (the law of the forum, i.e., Australian law). The Court determined that the remedial power to award compensation was part of the substantive law,⁷⁶ relying on the assumption that the lex causae was New Zealand law and that this finding did not offend the 'no advantage' principle that 'a plaintiff should receive no advantage from suing in the Australian forum which the plaintiff would not obtain in the lex loci delicti [the law of the place where the wrong occurs].'⁷⁷ Importantly, the Australian court did not determine whether any issues such as the heads of damage or quantification would be resolved by reference to the law of New Zealand, or the law of the forum,⁷⁸ holding that 'the question does not require that I, and I do not, reach any final view on whether any issues that may arise concerning the “kinds of damage, or amount of damages” that may be recovered would be governed by ss 494 and 495 of the FMC Act (or other principles of New Zealand law) or Australian law (if indeed there is any difference).'⁷⁹

The New Zealand court in A2 NZ and the Victorian Supreme Court in A2 AUS provide a reminder that 'there is nothing novel in the proposition that foreign law may be applied by an [Australian] court if it is the lex causae'; and, secondly, the foreign law to be applied in a domestic court can include statute law (claims under foreign statutes fall under the wide conception of 'torts' in private international law).⁸⁰ What is novel is the occasion for its application, which the TTPA facilitates and this decision is likely to increase the incident of its application by (1) clarifying the principles of interpretation that apply to the TTPA and (2) demonstrating the amenability of the court to exercise jurisdiction in the right case. The result may be an increase in concurrent proceedings that have a trans-Tasman element (e.g., involve a dual-listed entity or an entity with operations in both jurisdictions), with the risk of a stay looming large in the overall calculus of whether to commence litigation, and the availability of the TTPA as a case management tool to stymie competing claims.

ii Koper v. Zurich

Koper v. Zurich⁸¹ is an Australian series of proceedings that originated from a New Zealand representative proceeding.⁸² It is an example of the TTPA enabling claims to be litigated in a foreign jurisdiction (Australia) when the provenance and elements of the claims are otherwise New-Zealand-based. The question before the Australian court was whether a proceeding commenced in Australia was correctly commenced in that jurisdiction, in circumstances where the representative plaintiff, class members, and defendant were based in New Zealand, the defendant had not submitted to the jurisdiction of the Australian court and the relevant loss and damage occurred entirely in New Zealand.⁸³

The original New Zealand claim in Koper v. Zurich was filed by the owners corporation and alleged that New Zealand-based construction company Brookfield Multiplex New Zealand (BMX NZ) was negligent in the design and construction of an apartment complex in Auckland. In December 2012, after the class proceeding had commenced, BMX NZ went into liquidation. In a judgment of the New Zealand High Court handed down in March 2017,⁸⁴ the owners corporation obtained judgment against BMX NZ, in the sum of NZ$53 million. As of 29 June 2021, NZ$23 million of the judgment sum remained outstanding. The owners corporation then sought to recover the outstanding damages from the insurers by commencing representative proceedings in Australia⁸⁵ under Australian legislation that enabled them to make a claim directly against BMX NZ's insurance policy.⁸⁶

In the Australian proceeding, Koper v. Zurich involved a representative proceeding commenced in the state of New South Wales against the insurers of BMZ NZ, Zurich⁸⁷ and Aspen⁸⁸ (collectively the defendants/insurers, as applies). The plaintiff sought leave to file a summons against the defendants in the Supreme Court of New South Wales pursuant to state-based legislation that enables third party recovery directly against insurers, by allowing a claimant to access insurance policies when the insured defendant is unable to meet its liability.⁸⁹ The proceedings that followed are procedurally complex and involve issues of Australian constitutional construction that are not germane to the New Zealand context.⁹⁰ What is relevant to the New Zealand context is the criterion that needed to be satisfied to enliven jurisdiction of the Australian court. The primary judge found (upheld on appeal) that the proceeding brought in New Zealand must be capable of being brought in Australia.⁹¹ Relevantly, this turned on whether BMX NZ could have been served with an originating process in New Zealand that was issued by the Supreme Court of New South Wales and whether such service would have been effective by operation of Sections 9 and 10 of the TTPA, to bring the defendant before the Australian court. Ultimately, the procedural power of service determined the substantive power to commence proceedings. The court found that the TTPA would have authorised service of an originating process on the defendant in New Zealand and accordingly the surrogate Australian proceeding against the insurers was granted leave to proceed.⁹²

The Australian proceeding was brought for strategic reasons, to obviate the insolvency regime under the New Zealand Companies Act 1993 to enable class members to enjoy a right of priority over other unsecured creditors should the funds be paid to the liquidator of BMX. The effect of the Australian proceeding on the New Zealand insolvency proceeding would be that '[a]ll proceeds of a judgment in the [Australian Proceedings] will flow directly to the Plaintiff and will not form part of BMX's assets, thus not interfering with BMX's liquidation in New Zealand.'⁹³

The underlying facts meant that the only viable pathway for recovery by class members was to issue proceedings from Australia. The New Zealand Supreme Court had previously found that if Koper and the class members sought to vindicate their claims in New Zealand they would be barred and have no effective avenue of redress:

The Supreme Court of New Zealand has held that the Plaintiff cannot bring a claim based on the LRA because Zurich is not resident in New Zealand. In taking the view that the situs of the debt (and also an exclusive jurisdiction clause) is a matter of significance, the Supreme Court of New Zealand has taken a position contrary to that adopted in Chubb. If this Court were to refuse leave on discretionary grounds, then the Plaintiff would have no redress from legislation enacted in both New Zealand and New South Wales designed to ensure that the insurer meets claims of persons who have suffered loss and damage caused by an insured who holds insurance to cover the insured for that type of claim because, on the authority of Ludgater, the occurrence of the tort and the bringing of proceedings against the insured in New Zealand is insufficient and on the basis of Chubb as applied to the Claims Act, the exclusive jurisdiction clause and residency of one of the insurers (i.e. Aspen) is insufficient. That would be a most jarring result in my opinion.⁹⁴

The presence of a litigation funder was material to the New Zealand proceeding and why it was separately constituted in a foreign jurisdiction. The insolvency regime under the Companies Act 1993 (NZ) would have prohibited any monies recovered through the litigation against the insurers from passing to the class members because of restrictions that exist under the relevant legislation.⁹⁵ The NSW Supreme Court relied on expert evidence from New Zealand King's Counsel⁹⁶ to explain the operative provisions of the Companies Act 1993, with the conclusion that if any funds were recovered and passed through the liquidator the plaintiff and the class would not be entitled to any preference claim. Relevantly, the legislation requires that, where a creditor protects, preserves the value of or recovers assets of the company for the benefit of the company's creditors by the payment of money or the giving of an indemnity, they may obtain a preferential entitlement to monies recovered in the liquidation. However, under the New Zealand legislation, this provision only applies where:

1. the creditor has 'paid money or given an indemnity'.⁹⁷ A contribution of some other kind will not suffice;
2. the creditor shows that the payment or indemnity was for the benefit of the general body of creditors, rather than with a view to seeking to securing the net recovery for the sole benefit of the creditor or an entity related to it.; and
3. the creditor must protect, preserve or recover 'assets of the company', which does not include assets subject to a charge.

The NSW Supreme Court accepted expert evidence on the New Zealand law that concluded that the presence of the funder would likely vitiate any preference claim, as it engaged the above restrictions, namely:⁹⁸

1. the plaintiff has a litigation funder, therefore the plaintiff (and the other group members) are not providing any payment of money or indemnity towards the litigation; and
2. the purpose of the Australian proceeding was to obtain recovery of the insured liability for the sole benefit of the plaintiff (and the other group members).

The Koper v. Zurich proceeding is another example of the reach of the TTPA and the changing contours of trans-Tasman litigation. The strategic nature of the litigation is perhaps an interesting indicator of the way that, in the correct circumstances, each jurisdiction may be utilised as a 'forum of last resort' to litigate claims that otherwise may have been extinguished by the domestic law.

iii New Zealand litigation landscape

The TTPA decisions handed down in 2023 represent an interesting development in the New Zealand litigation landscape. The A2 NZ decision represents a common-sense approach to case management of concurrent proceedings, which is aimed at reducing duplication of costs and judicial resources and avoiding conflicting judgments. Practically, it provides a welcome bulwark for dual-listed entities (or entities with trans-Tasman operations) against the risk of having to meet litigation on either side of the Tasman Sea. It will be interesting to observe whether the TTPA is used as a strategic tool to frustrate litigation by defendants due to an advantage (perceived or real) that may arise in the other jurisdiction, and relatedly whether New Zealand courts are competent to apply Australian law, a finding that may be inferred but was ultimately left open by the decision in A2 NZ.

Legal and regulatory framework

New Zealand does not have a statutory or regulatory regime specifically governing litigation funding. Accordingly, the conduct of funders in litigation is dealt with under the general law and through the torts of maintenance and champerty. The court regulates the conduct of litigation funders via its powers to:

1. stay proceedings;⁹⁹
2. strike out proceedings;¹⁰⁰
3. order security for costs;¹⁰¹ and
4. make non-party cost orders.¹⁰²

i The applicability of statutory schemes to funding agreements

The extent to which litigation funding services are captured by existing statutory schemes is currently still a matter of debate and uncertainty. Broadly, litigation funding services may be captured by general consumer protection legislation,¹⁰³ credit and financial services legislation¹⁰⁴ and financial services provider legislation.¹⁰⁵ However, in respect of each of these general legislative schemes there has been no determinative court ruling to confirm their application to services provided by third party funders.

The contractual terms of a funding agreement are arguably subject to the Fair Trading Act 1986 prohibitions against misleading or deceptive conduct,¹⁰⁶ making unsubstantiated claims,¹⁰⁷ false or misleading representations,¹⁰⁸ unfair contract terms¹⁰⁹ and engaging in unfair practices.110 This is because the services provided by a funder are likely to be captured by the expansive definition of services under Section 2 of the Fair Trading Act 1986. However, the application of the other legislative schemes depends, at minimum, on a construction of threshold definitions under the respective legislation that have not yet been judicially determined.¹¹¹ Arguably, litigation funding services do not easily or appropriately comport with the definitions of financial products,¹¹² credit contracts,¹¹³ consumer credit contracts¹¹⁴ or consumer services¹¹⁵ that would invoke the jurisdiction of the other legislative schemes. The result is a degree of uncertainty as to the precise regulatory requirements applying to litigation funders in New Zealand. Illustrative of the uncertainty of interpretation that currently prevails, only two of the five domestic funders operating in New Zealand have registered as a financial service provider under the Finance Service Providers (Registration and Dispute Resolution) Act 2008.¹¹⁶

ii Maintenance, champerty and abuse of process

In contrast to other common law jurisdictions, the archaic tortious protections of maintenance and champerty persist in New Zealand. Despite their persistence, there are no reported examples of these torts being invoked to regulate funder control of litigation.¹¹⁷ As a consequence, the torts have largely fallen into disuse,¹¹⁸ and there has been no reported New Zealand case in which a claim in tort has succeeded.¹¹⁹ Consequently, there has been a mounting reform debate on the continued relevance of these ancient torts in modern litigation.¹²⁰ The most recent voice advocating for reform is the NZLC. In May 2022, NZLC R147 recommended the abolition of tortious maintenance and champerty,¹²¹ bringing New Zealand in line with other common law jurisdictions such as Canada and Australia.

In practice, the mechanism courts have favoured to police litigation funding has been to stay proceedings as an abuse of process.¹²² The power to find a proceeding an abuse is derived from the court's inherent jurisdiction¹²³ and the rules of court,¹²⁴ and is governed by the test set down by the Supreme Court of New Zealand in Waterhouse v. Contractors Bonding Ltd (Waterhouse).¹²⁵

Although there have been recent examples where the court has exercised the power to stay a proceeding,¹²⁶ such orders have been granted sparingly. Taken together, the authorities indicate judicial acceptance of the legitimate role of litigation funding to facilitate access to justice, indemnify plaintiffs and provide commercial certainty for defendants.¹²⁷

The general disposition of the court to litigation funding has been an incremental and cautious acceptance of the role played by funders in modern litigation. New Zealand courts have adopted a broadly non-interventionist approach to regulate funding that seeks to balance the rights of private parties to contract¹²⁸ with the court's supervisory role, particularly in representative proceedings.¹²⁹ The courts have shown a willingness to scrutinise client–funder relationships and intervene to protect plaintiffs, or class members as the case may be, when they consider it necessary.¹³⁰

The relationship between litigant and litigation funder is principally a creature of contract supplemented by any existing protections at law or equity or in statue. The touchstone of regulation is the funding agreement. The orthodox position of the court in relation to funding agreements was expressed by the Supreme Court in Waterhouse¹³¹ and reaffirmed by the Supreme Court in PricewaterhouseCoopers v. Walker at [55]:

In Waterhouse, this Court determined that it is not the role of the courts to act as general regulators of litigation funding arrangements or to give prior approval to such arrangements, at least in cases not involving representative actions.¹³² Nor was it the Court's role to assess the fairness of a funding arrangement as between the funder and the claimant party.¹³³ However, a court may exercise jurisdiction to stay for abuse of process.¹³⁴

A principle question for courts has been the degree to which a funder may exercise control over the litigation. Courts have recognised there is a legitimate locus of control that may be exercised by a litigation funder consistent with its reasonable entitlement to protect its investment.¹³⁵ The outer boundaries of this control are somewhat uncertain. The Supreme Court has tentatively suggested this boundary in the following terms, 'to be objectionable such control must be beyond that which is reasonable to protect money actually advanced or committed to by the litigation funder.'¹³⁶

Notably, the emergence of representative proceedings has altered the relative passivity of the court in regulating and exercising its oversight functions in respect of third party funding arrangements. Class actions represent a unique nexus between the public interest, access to justice and the fair resolution of mass claims, which has attracted increased scrutiny by courts and legislators. In particular, the availability of opt-out class actions following the decision in Southern Response v. Ross¹³⁷ has highlighted the importance of the court exercising its oversight role in circumstances where persons may unknowingly be members of a class.¹³⁸ The 2021 High Court decision in Southern Response v. Ross confirms that courts will now take a more active role in class proceedings in respect of approving proposed settlements and granting leave for discontinuance¹³⁹ or communications with class members.¹⁴⁰

iii Reviews into the regulation of litigation funding

In May 2022, the NZLC published its much-anticipated report into class actions and litigation funding.¹⁴¹ NZLC R147 was the culmination of an extensive discussion and consultation process over the past two-and-a-half years, with the NZLC engaging widely with stakeholders from government, the legal profession, the litigation funders, business, academics and community organisations.¹⁴² The NZLC's report makes 121 recommendations for comprehensive and integrated reform of class actions and litigation funding in New Zealand, including a statutory class actions regime.

In November 2022, the former Hipkins Labour government provided its formal response to the NZLC 147 Report, accepting in principle the 121 recommendations and confirming that it intends to begin policy work to advance the recommendations in 2023. The former government's response notes that some aspects of the NZLC recommendations require further consideration before implementation. Specifically, the following issues were raised for further analysis:

1. the policy implications of introducing a public fund for public interest litigation;
2. the scope of oversight for litigation funders and whether oversight should be restricted only to class actions; and
3. the impact on court resources posed by class actions and court oversight of litigation funding agreements.

In August 2023, the former Labour government announced, as part of an election promise, that if re-elected it would implement a statutory class actions regime reflecting recommendations from the NZLC R147. At the time of writing, substantive steps to implement the recommendations of the NZLC have not been taken.

Structuring the agreement

Any funded litigation conducted in New Zealand requires consensus being reached between the claimant, its lawyers and the litigation funder as to how the proceeding will be conducted and how the risks of the litigation will be shared.

i Form of the typical litigation funding arrangement

Arrangements for funded litigation are commonly comprised of two separate client agreements. The first is the retainer, or terms of engagement, between the client and their lawyers. This agreement sets out the scope of the legal work and the terms under which such work is to be performed. The retainer will typically set out the lawyer's basis for charging legal fees and disbursements as well as a raft of other standard terms and conditions of engagement, required by the Rules of Conduct and Client Care for Lawyers. The litigation funder is not generally party to this client retainer agreement. Commonly, the funder and lawyers have no direct contractual relationship at all, although clients often authorise their lawyers to report directly to the funder. Clients can often also agree with the funder as to what constitutes approved 'standard lawyer terms' as between the client and their lawyer. The funded client usually also authorises and directs the lawyer to receive any resolution sum on the client's behalf and to apply it in accordance with an agreed priority, as set out in the funding agreement.

The client typically enters a separate agreement with a litigation funder. This litigation funding agreement details the terms on which the litigation funding will be provided to the client. Generally, the lawyers are not a party to the funding agreement, although the agreement may provide for certain irrevocable directions to be given by the client to their lawyers for the purposes of keeping the litigation funder informed of progress and consulted on any significant decisions to be made throughout the litigation.

The funding agreement generally provides for the funder to advance some or all of the funded client's legal costs and disbursements of conducting the litigation as they are incurred, generally on a non-recourse basis.¹⁴³ The arrangements typically also require an indemnity from the funder in favour of the funded client, in respect of adverse costs, should the litigation be unsuccessful.¹⁴⁴ Where an adverse costs indemnity is provided litigation funders generally also agree to provide security for costs should the court make any order for security.¹⁴⁵

In return, the funded client agrees the funder may receive a portion of any resolution sum recovered from the litigation. Resolution sums are usually achieved via settlement or from the proceeds of any favourable judgment or court order. The funder's remuneration is commonly calculated as a percentage of the sum recovered, although it can be calculated in other ways. Commissions based on percentages are dependent on the nature of the risks undertaken, the time involved and the type and amount of funding required. In larger projects or class action litigation, the funder may also assist with pre-claim administration, book building, project management and general administration, and may charge a separate fee for such services in the event of success. Funding agreements can allocate certain project management responsibilities and day-to-day administrative control over the litigation to the funder, allowing the funder the right to provide recommendations and administrative support to the lawyers, subject to the client's overriding instructions.

ii Judicial intervention

On various occasions the Supreme Court has been asked to consider the role it should play in respect of litigation funding agreements. As previously mentioned, the court has consistently rejected the notion that it should act in the role as regulator of litigation funding agreements,¹⁴⁶ expressly noting that this is more appropriately a matter for legislation or regulation if considered desirable. The NZLC has accepted this invitation, recommending a raft of legislative and regulatory changes in this area.¹⁴⁷

Likewise, the court plays no role in assessing the fairness of any bargain between a funder and a plaintiff,¹⁴⁸ although the court can be called on to determine whether arrangements made with litigation funders amount to an abuse of process.¹⁴⁹ Consistent with common law developments in other jurisdictions, the concept of what constitutes an abuse of process in the context of a litigation funding agreement has been restricted. In Waterhouse, the Supreme Court found that a stay on abuse of process grounds should only be made 'on traditional grounds or where the funding arrangement effectively constitutes' an impermissible assignment of a cause of action.¹⁵⁰ In assessing whether there has been an assignment, the court will have regard to the funding arrangements as a whole, including the level of legal control able to be exercised by the funder, the profit share and the role of the lawyers acting.

Relatedly, in Fostif, the New South Wales Court of Appeal recognised that a high level of control by the funder is expected and permissible but cautioned that it would be contrary to public policy for the lawyers to fully abdicate to the funder the obligation to act for the representative party.¹⁵¹ This acceptance of a level of control being an inevitable part of the funder merely protecting its investment has also been embraced in New Zealand.¹⁵² Therefore, while it is permissible for a funder to maintain day-to-day control of a claim, the legal representatives are expected to consult with the client on key issues. Hence, funding agreements often expressly preserve the client's right to override the funder's instructions and commonly include dispute resolution mechanisms.

Disclosure

The Supreme Court has made its position clear on the issue of disclosure and approval of third party litigation funding agreements, at least in the context of non-representative proceedings. The leading case in this area is again Waterhouse,¹⁵³ where the Court said it was not its role 'to act as general regulators of litigation funding arrangements'. The Court stressed it is not its role to give prior approval to funding arrangements.¹⁵⁴ However, the Court left open the scope of its supervisory role for litigation funding arrangements in connection with representative proceedings.¹⁵⁵

More recently, in the course of dealing with a representative proceeding on other procedural issues, the Supreme Court in Southern Response Earthquake Services Ltd v. Ross considered what had been said in Waterhouse about the role of the court in reviewing litigation funding agreements. The Supreme Court concluded (contrary to submissions of the Law Society) that it would be premature to say that there is any expectation that a funding agreement should routinely be provided to the court as part of an application under HCR 4.24(b).¹⁵⁶

So, although there is no requirement for disclosure of the funding agreement as a whole, Waterhouse remains authority for the proposition that the parties to the litigation are entitled to know the identity of the real parties to the litigation, and on this basis the funded parties must still disclose the fact that there is litigation funding involved, the identity of the litigation funder and whether that litigation funder is subject to the jurisdiction of the New Zealand courts.¹⁵⁷

Other particulars of the funding arrangement, such as the financial means of the funder and the basis on which the funding can be withdrawn, are generally not required to be disclosed. These issues can be addressed more directly with an application for security for costs if appropriate. Even in the context of an abuse of process application, where the funding agreement is to be disclosed to the parties, the courts have still been careful to permit the funded party to maintain confidentiality over terms that might provide a tactical advantage to their opponent should they be divulged.¹⁵⁸

Costs

New Zealand is an adverse costs jurisdiction where the power to award costs is at the discretion of the court.¹⁵⁹ Practically, the courts administer a scale costs regime that is instructive, but not determinative, of the manner in which costs are calculated and recovered.¹⁶⁰ An increase or uplift on scale costs is available at the discretion of the court, following a multifactorial assessment of the complexity, significance and reasonableness of the costs claimed.¹⁶¹

i Security for costs

Security for costs may be ordered on the application of a defendant where the plaintiff is either resident or incorporated outside of the jurisdiction, or there is reason to believe that a plaintiff will be unable to pay a defendant's costs if unsuccessful.¹⁶² The order is discretionary, and the presence of a litigation funder may be a relevant factor to security being ordered.¹⁶³ Practically, security for costs is commonplace in representative proceedings where a litigation funder is involved. The NZLC has recommended a statutory presumption in favour of security where the proceeding is supported by litigation funding, to be provided in a form that is enforceable in New Zealand.¹⁶⁴ Beyond ordering security, the courts have been reticent to adopt a general regulatory mandate of litigation funding in respect of capital adequacy or requiring proof of a funder's capacity to satisfy an adverse costs award.¹⁶⁵

The forms of security that the court is willing to accept are not closed, and ultimately will be at the satisfaction of the court.¹⁶⁶ In practice, the court has accepted the following forms of security, depending on the circumstances of each case:

1. cash paid into court or held on trust;¹⁶⁷
2. a bank bond or guarantee;¹⁶⁸ and
3. a guarantee from the litigation funder.¹⁶⁹

New Zealand courts have typically rejected after-the-event (ATE) insurance as an adequate form of security arising from concerns regarding enforceability against underwriters.¹⁷⁰ The court in Houghton v. Saunders did, however, highlight the narrow circumstances in which a deed of indemnity from an insurer may be permissible: where the underwriters' obligations were enforceable in New Zealand and the underwriters were reputable and solvent.¹⁷¹

ii Funder's liability for costs

A funder's liability for costs arises in two contexts; under contract and at general law. At general law, the power to make a non-party cost order against a funder already exists as part of the court's general costs discretion and is recognised at common law.¹⁷² Despite the acceptance of non-party cost orders, a funder's liability for costs is the subject of an active reform debate in the class actions context. The NZLC has recommended a discrete statutory power to 'make orders directly against the litigation funder for the provision of security for costs and payment of adverse costs'¹⁷³ in class actions. Practically, the issue for the NZLC is enforceability, where the assets of the funder may be outside the jurisdiction, or the terms of the funding agreement may not be governed by the laws of New Zealand. The NZLC has recommended a suite of intersecting recommendations that would substantially amend the costs regime currently applicable to class proceedings, namely that (in addition to the aforementioned non-party orders):

1. the terms of funding agreements are only enforceable if approved by the court;¹⁷⁴
2. a rebuttable presumption that security for costs, in all funded class proceedings, will be provided in a form that is enforceable in New Zealand;¹⁷⁵ and
3. the governing law under funding agreements of class proceedings should be the law of New Zealand.¹⁷⁶

iii Costs and class actions

Class actions have introduced some novel issues into the costs landscape, such as common fund orders and common costs in concurrent proceedings.

Common fund doctrine

The common fund doctrine is in a nascent stage of development in New Zealand. The first application for a common fund order (CFO) was made in the Ross v. Southern Response class litigation.¹⁷⁷ Ultimately, the proceedings resolved in December 2021 without the Court being required to determine the application for a CFO. However, the series of decisions from the High Court, Court of Appeal and Supreme Court in this litigation describe the general contours of an emerging acceptance of the common fund doctrine.¹⁷⁸

The second CFO application was made in the Simons v. ANZ Bank NZ class action. The decision in Simons v. ANZ Bank NZ Ltd ¹⁷⁹ (handed down on 27 July 2022) draws heavily upon the Ross v. Southern Response litigation, ultimately finding that the High Court has power to make a CFO in a representative proceeding, although the Court ultimately declined to make the CFO at an early stage in the proceeding.¹⁸⁰ Accordingly, the power exists but it has yet to be exercised in an appropriate case and at an appropriate stage.

The Supreme Court in Southern Response v. Ross¹⁸¹ recognised that the court has power to approve settlements as a condition of leave being granted under HCR 4.24 to bring a representative proceeding on an opt out basis,¹⁸² and that this power derives from the court 'exercising an adjudicative power in their protective or supervisory jurisdiction'.¹⁸³ It is not clear whether such settlement approval power extends to making a CFO or the setting of funding commission rates in the absence of a statutory foundation for this power. However, such an interpretation may be available based on the Court's finding that '. . . in deciding whether to approve a settlement, courts can consider the extent to which the settlement prejudices individual class members'.¹⁸⁴

The common fund doctrine arises in this context as a mechanism to ensure that individual class members are not prejudiced inter se. As the Supreme Court expressed, 'common fund orders are one of the techniques used to try and respond to what is referred to as the problem of “free riders”; that is, those who take the benefit of the claim without shouldering any of the burden'.¹⁸⁵ The advent of opt-out or open class representative proceedings in New Zealand as a result of the decision in Southern Response v. Ross¹⁸⁶ produces the potential for 'free-riding' by open class members that have not entered a funding agreement; thereby, they are not contractually bound to contribute to the legal or litigation funding costs of the proceeding, but are able to share in the resolution of the proceeding.

In the same litigation in Ross v. Southern Response, the Court of Appeal expressed support, albeit obliquely, that the Court had sufficient power to make such an order without determining the question.¹⁸⁷

The Court of Appeals' line of reasoning ultimately informed Venning J's acceptance that the court has power to make a CFO in Simons v. ANZ Bank NZ Ltd.¹⁸⁸ Importantly, the decision provides interpretive clarity on the source of power to make such an order. The decision eschews an interpretation that the power arises under HCR 4.24,¹⁸⁹ preferring the inherent jurisdiction of the court, supplemented by the expansive plenary powers conferred by HCR 1.6¹⁹⁰ to fashion bespoke orders, where there is no existing procedure 'in the manner that the court thinks is best calculated to promote the objective of these rules'.¹⁹¹ Per Venning J at [166]:

Further, at some stage in every representative proceedings, it will be necessary for the Court to address the issue of how any fund recovered in the class action is to be distributed. That will inevitably require the Court to consider the position of, and appropriate return to, the litigation funder. As the Supreme Court noted in Southern Response Earthquake Services Ltd v. Ross it is common for this Court to make orders approving settlements and distribution proposals. The Court has an adjudicative power in its protective or supervisory jurisdiction, and there is a need for the Court to exercise that jurisdiction in that context.

As a consequence of Simons v. ANZ Bank NZ Ltd, New Zealand courts have the power to make CFOs, and that power may be exercised at the appropriate time, likely at settlement or judgment. In the absence of a statutory power, the jurisprudence in this area continues to accommodate and manage the innovations introduced by litigation funding. Set against this backdrop is the legislative reform debate. The NZLC has recommended a series of reforms that, if adopted, would codify the power of the court to apportion legal costs and funding commissions.

It is important to understand the distinction between a CFO and a cost sharing order as proposed by the NZLC. There is a profusion of definitions for a CFO at common law, depending upon the precise content of the order and the stage of the proceeding when an order is sought. The order has been referred to as a commencement CFO,¹⁹² settlement CFO,¹⁹³ judgment CFO,¹⁹⁴ an expense sharing order¹⁹⁵ and an equitable remuneration order.¹⁹⁶ In examining the definitional diversity that now exists, it is easy to become distracted by what has been referred to as the 'triviality of labels'.¹⁹⁷ In this context, a CFO is a term of convenience used to describe a broad specie of orders whose function is to apportion litigation funding costs of a proceeding.

The court has also considered the funding equalisation order (FEO) as an alternate cost-spreading mechanism. In Simons v. ANZ Bank NZ Ltd,¹⁹⁸ the Court succinctly summarised how an FEO operates:

CFOs can be contrasted with funding equalisation orders (FEOs). FEOs deduct an amount from the settlement or award paid to non-funded members that is equivalent to the amount they would have had to pay to the funder, had they entered the funding agreement. The amount deducted is then pooled and distributed pro rata amongst all class members, but not the funder. FEOs achieve equity amongst class members, but do not augment the sums paid to the funder.

The decision in Simons v. ANZ Bank NZ Ltd did not specifically deal with the availability of FEOs as a matter of law. However, it can be inferred that an FEO is available on the same basis as a CFO where the court 'thinks it is best calculated to promote the objective of the HCR'.¹⁹⁹ There is typically a misplaced assumption that an FEO will reliably be superior to a CFO, on the basis that under an FEO the funder does not receive more than the total commission it would have received from the funded class members.²⁰⁰ That assumption is misplaced particularly when accepted reflexively and without regard to the circumstances of each case.

Australian jurisprudence is instructive on this point: 'a funding equalisation order is not always the appropriate counterfactual or comparator' to a CFO.²⁰¹ The range of factors that weigh against an FEO in certain circumstances were summarised by the court in Simons v. ANZ Bank NZ Ltd, referring to the plaintiff's submissions:²⁰²

In Mr Salmon's submission FEOs are inferior to CFOs. FEOs do not incentivise funders to invest in opt out proceedings, because they do not allow funders to collect a commission on unfunded class members' recoveries or provide certainty as to potential returns at the beginning of the proceedings. Under FEOs the Court has less flexibility to amend the funding commission rates (FCRs). CFOs are simpler and easier to understand. The other advantage of a CFO is that it obviates the need for book building and ensures that class members are able to make better informed choices as to whether to opt out.

As can be seen, the common fund doctrine is in its nascency in New Zealand but is evolving in parallel with the courts' recognition of the role played by litigation funders, the emergence of opt-out class actions and a burgeoning litigation funding market.

iv Common costs

The series of class actions against James Hardie in New Zealand have raised novel but consequential issues regarding costs incurred in concurrent or parallel class actions, alleging materially similar claims. In one of these cases a dispute arose as to whether the court should recognise and apportion costs incurred across separate, but materially similar, class proceedings that have been incurred for the common benefit of all claims; for example, where common experts give evidence on the same subject matter or parties seek to rely upon evidence filed in related or parallel proceedings in respect of common issues.

The issue arose in Cridge v. James Hardie in the context of three proceedings filed against a common defendant, James Hardie, for materially similar claims.²⁰³ The plaintiffs in the Cridge proceeding were the first to proceed to trial, ultimately failing in their claims at first instance and incurring significant adverse costs. The second proceeding²⁰⁴ settled and the third proceeding²⁰⁵ has also settled in 2023.

At first instance the court in Cridge v. James Hardie²⁰⁶ held that common costs were incurred across all three proceedings but declined to apportion those costs, despite conceding that 'there is, however, undoubtedly within the James Hardie evidence material that would fall within the concept of a common cost, being output that will be usable in whole or in part, directly or as relevant material, in the defence of all three claims'.²⁰⁷

The common costs decision is subject to an application for leave to appeal, as at the time of writing. The consequences of this decision on concurrent class actions are manifold and potentially profound, with, inter alia, the following issues arising:

1. the ruling disadvantages claims filed first-in-time by forcing those claimants to bear all the costs risks for common work and incentivises multiplicity of proceedings, to minimise the potential adverse costs risks burden on subsequent claims. Crucially, this finding does not appear to sit conformably with the object of the HCR 'to secure the just, speedy, and inexpensive determination of any proceedings.'²⁰⁸
2. the decision does not resolve the potential risk of double recovery by a successful defendant where there is multiplicity of similar claims against them that are not heard together; and
3. the role of case management by the court where proceedings alleging similar claims against the defendant or defendants are run concurrently (or sequentially) and the appropriate role for consolidation orders.

The James Hardie series of class actions also raise the question of whether a bespoke class actions costs regime is necessary in New Zealand arising from the unique attributes of these types of claims, such as the cost multipliers, vulnerability of plaintiffs to adverse cost events and the general costs quantum involved. Alternatively, judicial guidelines or practice notes specific to class actions, akin to the approach taken in the Australian Federal Court, may assist the court in undertaking the complex task of cost assessment in these types of proceedings. Notably, the NZLC's view is that a bespoke class action costs regime is not necessary at this time.

Outlook and conclusions

Recent years have seen incremental developments in support of a developing third party litigation funding market. These developments have aided in maturing the jurisprudence on the use of third party litigation funding in New Zealand. Class actions have been the touchstone of many of these recent developments. The acceptance of the common fund doctrine in the Simons v. ANZ Bank NZ class action, coupled with the comprehensive class action and litigation funding reform agenda advanced by the NZLC, are important milestones in the evolving architecture of New Zealand's litigation funding landscape. In particular, NZLC R147 is an ambitious blueprint that, if adopted, would provide procedural clarity to help foster competition and potentially reduce avoidable costs on procedural skirmishing over some aspects of currently untested processes and procedures. However, depending on the final form of the proposed new litigation funding court approval requirements, these may prove to be significant disincentives for litigation funders and claimants. If the hurdles are set too high they may simply discourage investment in the jurisdiction, and have other, unintended consequences, by making the commencement of claims more cumbersome, expensive and uncertain for claimants and their funders as well as defendants.

New Zealand is well positioned to advance legal claims that are at the vanguard of current litigation, such as in the areas of privacy and climate change litigation. The judicial approach to litigation funding and class actions has continued to demonstrate a willingness by the court to exercise its powers flexibly and creatively to fashion a bespoke, if ad hoc, response to the novel issues these cases bring in the absence of a statutory regime. Class actions have been the principal driver of this debate and the judicial response. The acceptance of CFOs, concurrent proceedings and litigation under the TTPA by the courts are recent examples. The court has maintained a generally non-interventionist approach to third party funding arrangements. The arrival of more funding competition in the market and the maturing discourse have created favourable conditions for statutory change but will require legislative determination in the new parliament.

Looking ahead, the immediate challenge appears to be striking the right balance between achieving appropriate levels of consumer protection while minimising regulatory compliance costs and encouraging competition from litigation funding providers. Although no silver bullet, implementing a comprehensive regime for the conduct of class actions along with a statutory framework for third party litigation funding arrangements will potentially represent a significant step towards facilitating better access to justice to more people across New Zealand.

As was stated by the Supreme Court in Southern Response v. Ross,²⁰⁹ the objectives of representative actions are threefold: improving access to justice, facilitating the efficient use of judicial resources and strengthening incentives for compliance with the law. Providing clarity in relation to the permitted uses of third party litigation funding and laying down the rules for the conduct of representative proceedings will see all three of these objectives advanced and should result in tangible benefits to New Zealanders seeking to utilise the judicial system in the years ahead.

Footnotes

_{1 Jason Geisker is a principal and Simon Gibbs is an associate at Maurice Blackburn Lawyers, the legal advisers to Claims Funding Australia Pty Ltd.
2 Re Nautilus Developments Ltd (in liq) [2000] 2 NZLR 505 (HC).
3 Sievewright v. Ward & Others [1935] NZLR 43, 48, Ostler J; see also Law Commission Preliminary Paper 43: Subsidising Litigation NZLC PP43, page 3.
4 IBISWorld, Legal Services in New Zealand (July 2021), page 9; Omni Bridgeway Annual Report 2021, page 10.
5 Omni Bridgeway Annual Report 2021, page 10.
6 See New Zealand Law Commission (NZLC) IP45, Class Actions and Litigation Funding (December 2020) (NZLC IP45) at [14.24], which identifies 40 cases in New Zealand in which the plaintiff received litigation funding.
7 IBISWorld, Legal Services in New Zealand (July 2021), page 9.
8 Unless recorded in a judgment or disclosed as part of a class action. Prior to the decision in Waterhouse v. Contractors Bonding [2013] NZSC 139, [2014] 1 NZLR 91, there was no common law obligation on a funded party to disclose the fact that it was receiving litigation funding.
9 Funder of the Strathboss Kiwifruit Ltd v. Attorney General (kiwifruit) class action, one (of two) separate CBL Corporation Ltd class actions.
10 Other domestic-based funders include Claims Resolution Services, Joint Action Funding Ltd, LPF Group Ltd, Risk Worldwide/My Insurance Claim and Tempest Litigation Funders.
11 Claims Funding Australia Pty Ltd is a wholly owned subsidiary of Maurice Blackburn Lawyers, (Australia's largest and most successful plaintiff class action law firm) and has funded the Ross v. Southern Response Earthquake Services class action, and Cridge v. Studcorp & James Hardie class actions.
12 Formerly known as IMF Bentham, it was the funder of one (of two) separate CBL Corporation Ltd class actions.
13 Funder of the Cooper v. ANZ Bank New Zealand Ltd class action.
14 Funder of the Shadowclad class action, White v. James Hardie class action, Feltex class action, Intueri class action.
15 Claims Funding Australia has no published minimum claim size.
16 See NZLC IP45, at [10.39].
17 NZLC IP45, page 13.
18 ibid.
19 NZLC IP45, at [14.38].
20 NZLC IP45, at [14.32].
21 Waterhouse v. Contractors Bonding Ltd [2013] NZSC 89, [2014] 1 NZLR 91.
22 Sage Securities Ltd v. Rood HC Wellington CIV-2009-485-1150, 11 November 2009.
23 Patel v. Patel [2014] NZHC 2410.
24 Williams v. Auckland Council [2015] NZCA 479, (2015) 7 NZ ConvC 96-013.
25 NZLC R147, Class Actions and Litigation Funding (May 2022) (NZLC R147), at 368.
26 NZLC R147, page 368.
27 ibid., page 364.
28 'There are significant barriers to accessing civil justice in Aotearoa New Zealand, including the costs associated with litigation. Class actions and litigation funding are not a silver bullet for those issues, but we think they can both make important contributions.' Prime Minister Chris Hipkins, 15 September 2023, https://www.nzherald.co.nz/nz/politics/election-2023-labour-wants-to-enable-class-action-law-suits-review-district-court-jury-trials/PFJS2AGSE5BCTEHKWEQ2JN5EQQ/.
29 Trans-Tasman Proceedings Act 2010, s.3(1)(a).
30 Trans-Tasman Proceedings Act 2010, s. 3(1); for an Australian perspective see also Attorney-General's Department, Australian Government https://www.ag.gov.au/international-relations/private-international-law/trans-tasman-proceedings-regime.
31 Agreement between the Government of Australia and the Government of New Zealand on Trans-Tasman Court Proceedings and Regulatory Enforcement, signed 24 July 2008, [2013] ATS 32 (entered into force 11 October 2013).
32 Whyte v. The a2 Milk Company Limited [2023] NZHC 22.
33 Zurich Insurance plc v. Koper [2022] NSWCA 128 (Bell CJ, Ward P and Beech-Jones JA).
34 Kevin James Whyte and Ors v. The a2 Milk Company Limited CIV-2022-404-000762.
35 Kevin James Whyte and Ors v. The a2 Milk Company Limited [2023] NZHC 22 at [68].
36 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited S ECI 2021 03645: The proceeding is a consolidated proceeding. Prior to consolidation, the two lead plaintiffs were each the lead plaintiff of a separate proceeding, being S ECI 2021 03645 (the Thomas Proceeding), and S ECI 2021 04403 (the Xiao Proceeding). The proceedings were consolidated on 15 June 2022.
37 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [127] to [128].
38 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [39]–[47].
39 Trans-Tasman Proceedings Act 2010, s.24(1).
40 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [119]. Concurrent proceedings are a factor to be considered under s.24(2)(f) of the TTPA.
41 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [101]–[102] and see full analysis of the criteria under s.24(2)(f) from [70]-[102] and [119].
42 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [70]–[102] and [119].
43 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [77].
44 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [80], referring to the NZLC R147 at 5.3.
45 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [78].
46 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [78]: (a) the same plaintiff classes, same or similar subject matter, commenced in the same jurisdiction; (b) different plaintiff classes, same or similar subject matter, commenced in the same jurisdiction; and (c) different plaintiff classes, same or similar subject matter, commenced in different jurisdictions.
47 See Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [78]–[100].
48 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [79].
49 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [84].
50 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [116].
51 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [118].
52 id.
53 Different plaintiff classes, same or similar subject matter, commenced in different jurisdictions.
54 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [101].
55 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725.
56 Trans-Tasman Proceedings Act 2010, s.3(1)(a).
57 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [70]–[76].
58 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [39].
59 Whyte v. The a2 Milk Company Limited [2023] NZHC 22 at [46].
60 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725.
61 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [19]–[32].
62 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [33]–[84].
63 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [85]–[165].
64 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [35].
65 Fair Trading Act 1986 and the Financial Markets Conduct Act 2013.
66 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [44].
67 id.
68 See full analysis Dariusz Koper v. Zurich Insurance PLC [2021] NSWSC 1587 at [44]–[83].
69 In relation to claims made under the Financial Markets Conduct Act 2013, see [55]–[74].
70 Ms Jennifer Cooper KC on the Fair Trading Act 1986 (NZ) claims.
71 See Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [43]–[59]. The court appointed contradictor did not oppose the expert's conclusions (in fact, the contradictor changed his opinion in reliance on the expert's opinion) and the Court did not depart from the expert's opinion with was also in accordance with the general principle explained in Neilson v. Overseas Projects Corporation of Victoria Ltd 391 [185] (Kirby J); and James Hardie & Co Pty Ltd v. Hall (1998) 43 NSWLR 554 (James Hardie), 573.
72 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [79], referring to Randerson J in the New Zealand case Rimini Ltd v. Manning Management & Marketing Ltd [2003] 3 NZLR 22 as extracted in the expert report of Ms Cooper KC at [4.6]–[4.7].
73 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [79]–[83].
74 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [120]–[165].
75 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [121].
76 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [149].
77 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [149] referring to Pfeiffer, 539–40 [83]–[84], quoted in Amaca, 650–1 [90].
78 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [119].
79 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [157].
80 Jake Thomas and Yue Xiao v. The a2 Milk Company Limited [2022] VSC 725 at [36].
81 Dariusz Koper v. Zurich Insurance PLC 2021/91398; Dariusz Koper v. Zurich Insurance PLC [2021] NSWSC 1587; Zurich Insurance PLC v. Koper [2022] NSWCA 128; and Zurich Insurance Company Ltd v. Koper [2023] HCA 25.
82 Body Corporate 346799 v. KNZ International Co Ltd [2017] NZHC 511.
83 See headnote to Zurich Insurance plc v. Koper [2022] NSWCA 128 (Bell CJ, Ward P and Beech-Jones JA).
84 Body Corporate 346799 v. KNZ International Co Ltd [2017] NZHC 511.
85 Dariusz Koper v. Zurich Insurance PLC [2021] NSWSC 1587 (per Rein J).
86 Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW).
87 Zurich Insurance PLC, domiciled in Switzerland.
88 Insurance UK Ltd, domiciled in the United Kingdom.
89 Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW). See ss.4 and 5 for the relevant leave provisions the subject of the proceedings.
90 In sum, the plaintiff and class members were successful in the Supreme Court of NSW and the NSW Court of Appeal, both finding that they could bring claims against the insurers in Australia. The insurers appealed to the High Court of Australia in Zurich Insurance Company Ltd v. Koper [2023] HCA 25. The appeal was dismissed and the decision of the Court of Appeal (Zurich Insurance plc v. Koper [2022] NSWCA 128) and Supreme Court (Dariusz Koper v. Zurich Insurance PLC [2021] NSWSC 1587) at first instance were upheld.
91 Zurich Insurance plc v. Koper [2022] NSWCA 128 at [13]-[14].
92 ibid.
93 Dariusz Koper v. Zurich Insurance PLC [2021] NSWSC 1587 at [135(c)].
94 Dariusz Koper v. Zurich Insurance PLC [2021] NSWSC 1587 at [142(3)].
95 Schedule 7, (1)(e) Companies Act 1993
96 David Chisholm KC and Jennifer Sarah Cooper KC.
97 Schedule 7 (1)(e)(i).
98 Dariusz Koper v. Zurich Insurance PLC [2021] NSWSC 1587 at [135]–[137] and [142].
99 High Court Rules 2016, r 15.1(3); Waterhouse v. Contractors Bonding Ltd [2013] NZSC 89, [2014] 1 NZLR 91 at [30] and [32]; and Cain v. Mettrick [2020] NZHC 2125.
100 High Court Rules 2016, r 15.1(1).
101 High Court Rules 2016, r 5.45. See also Houghton v. Saunders [2013] NZHC 1824 and White v. James Hardie New Zealand [2019] NZHC 188.
102 High Court Rules 2016, r 14.1. Waterhouse v. Contractors Bonding [2014] 1 NZLR 91 at [52]-[53]. Also consider, the decision in Prattley Enterprises (2017) 23 PRNZ 484 recognised that a defendant may reserve its position to seek leave for any order to be made in the name of the funder, in the event an amount ordered is not paid. See also NZLC IP45 [15.50]-[15.56] and Falloon (as executors of the Estate of the Late Bligh) v. The Earthquake Commission [2020] NZHC 874 for an example of where a non-party costs order was made against a funder. See also NZLC IP45 at [19.19].
103 Fair Trading Act 1986; and Consumer Guarantees Act 1993.
104 Credit Contracts and Consumer Finance Act 2003; and Finance Markets Conduct Act 2013.
105 Finance Service Providers (Registration and Dispute Resolution) Act 2008.
106 Fair Trading Act 1986, ss.9–10.
107 Fair Trading Act 1986, s12D.
108 Fair Trading Act 1986, s13.
109 Fair Trading Act 1986, s26A.
110 Fair Trading Act 1986, ss.17–26 (as the case may be).
111 For a helpful discussion of these threshold definitions see NZLC IP45 at [15.57]–[15.62].
112 Finance Markets Conduct Act 2013, s.7.
113 Credit Contracts and Consumer Finance Act 2003, s.7, to be read together with the definition of credit at s.6.
114 Credit Contracts and Consumer Finance Act 2003, s.11.
115 Consumer Guarantees Act 1993. The term 'consumer services' is used here as a term of convenience to describe the atomised definition that appears under the legislation by construing the separate terms 'consumer' and 'services' under s.2 of the Consumer Guarantees Act 1993.
116 See NZLC IP45 at [15.62].
117 NZLC IP45 at [15.6].
118 See in particular Auckland City Council as Assignee of Body Corporate 16113 v. Auckland City Council [2008] 1 NZLR 838 (HC) at [45]–[46].
119 Law Commission Preliminary Paper 43: Subsidising Litigation, NZLC PP43, page 6.
120 See for example, S Todd et al., The Law of Torts in New Zealand (2nd edn, 1997) (Brooker's Limited, Wellington) 1004.
121 NZLC R147, Recommendation 107.
122 See Elias CJ in PricewaterhouseCoopers v. Walker [2017] 1 NZLR 735 at [118]-[119] for an articulation of the persistence of maintenance and champerty and the how the stay for abuse of process has emerged in that setting.
123 Waterhouse v. Contractors Bonding Ltd [2014] 1 NZLR 91 at [30].
124 High Court Rules 2016, r 15.1(3).
125 Waterhouse v. Contractors Bonding Ltd [2014] 1 NZLR 91 at [31]-[32], referring approvingly to the Australian High Court decision in Jeffery & Katauskas Pty Ltd v. SST Consulting Pty Ltd [2009] HCA 43, [2009] 239 CLR 75 at [27] per French CJ, Gummow, Hayne and Crennan JJ, citing IH Jacob 'The Inherent Jurisdiction of the Court' (1970) 23 Current Legal Problems 23 at 43. The circumstances that may give rise to a stay for abuse, as set down in Waterhouse, were subsequently summarised by the Supreme Court in PricewaterhouseCoopers v. Walker [2017] 1 NZLR 735 at [56].
126 Cain v. Mettrick [2020] NZHC 2125.
127 Houghton v. Saunders (2008) 19 PRNZ 173 (HC) at [177]. For example, to satisfy security for costs or costs awards in the event a defendant succeeds in defending a claim. Balanced against this view are the concerns expressed by the Supreme Court in Waterhouse v. Contractors Bonding Ltd [2014] 1 NZLR 91 at [41] and PricewaterhouseCoopers v. Walker [2017] NZLR 735 at [114]–[122] (per Elias CJ in dissent).
128 See Waterhouse v. Contractors Bonding [2014] 1 NZLR 91 at [28]. Nor was it the courts' role to assess the fairness of any bargain between a funder and a plaintiff: see [48] and [76(f)].
129 See for example, Paine v. Carter Holt Harvey Limited [2019] NZHC 1614; Southern Response Earthquake Services Ltd v. Southern Response Unresolved Claims Group [2017] NZCA 489 at [79]-[80]; Southern Response Earthquake Services Limited v. Brendan Miles Ross and Coleen Anne Ross [2020] NZSC 126 at [81] and [86]: 'While the Court in Waterhouse said it was not the courts' role “to act as general regulators of litigation funding arrangements”, the Court left open the scope of the courts' supervisory role for litigation funding arrangements in relation to representative proceedings. That said, we consider it would be premature to say there is an expectation that any litigation funding agreement should routinely be provided to the court as part of an application under r 4.24(b), as the Law Society submits.'
130 Southern Response Earthquake Services Ltd v. Ross [2020] NZSC 126 at [81].
131 Waterhouse v. Contractors Bonding Ltd [2014] 1 NZLR 91.
132 Waterhouse v. Contractors Bonding Ltd [2014] 1 NZLR 91 at [27]–[29].
133 Waterhouse v. Contractors Bonding Ltd [2014] 1 NZLR 91 at [48].
134 Waterhouse v. Contractors Bonding Ltd [2014] 1 NZLR 91 at [57].
135 Waterhouse v. Contractors Bonding [2014] 1 NZLR 91 at [45]–[46].
136 PricewaterhouseCoopers v. Walker [2017] NZLR 735 at [122] per Elias J (in dissent).
137 Southern Response Earthquake Services Ltd v. Ross [2020] NZSC 126.
138 Ross v. Southern Response Earthquake Services Ltd [2021] NZHC 2452 at [17]–[43].
139 Ross v. Southern Response Earthquake Services Ltd [2021] NZHC 3497.
140 Ross v. Southern Response Earthquake Services Ltd [2021] NZHC 2452; Ross v. Southern Response Earthquake Services Ltd (No. 2) [2021] NZHC 2453; and Ross v. Southern Response Earthquake Services Ltd [2021] NZHC 2451.
141 R147 Ko ngā Hunga Take Whaipānga me ngā Pūtea Tautiringa/Class Actions and Litigation Funding.
142 Terms of Reference (18 November 2019); NZLC IP45 (4 December 2020); and Supplementary Issues Paper (30 September 2021) - IP48 Class Actions and Litigation Funding: Supplementary Issues Paper (NZLC IP48).
143 NZLC IP45, at [14.37].
144 Although it is not mandatory to provide such contractual indemnities as a part of a third party funding arrangement: see Waterhouse v. Contractors Bonding Ltd [2013] NZSC 89 at [52].
145 Again, this is not a requirement, and applications for security for costs provide a practical solution to any concerns a defendant might have in this sense: ibid. at [53].
146 Waterhouse v. Contractors Bonding Ltd [2013] NZSC 89 at [28].
147 As mentioned at Section III.iii of this chapter.
148 ibid. at [48] and [76(f)], although these comments were limited to non-representative proceedings.
149 See Southern Response Earthquake Services Ltd v. Ross 2020 [NZSC] 126 at [85].
150 Waterhouse v. Contractors Bonding Ltd [2013] NZSC 89, [2014] 1 NZLR 91 at [76(e)]. See also at [56]–[57] and [61].
151 Fostif v. Campbells Cash & Carry Pty Ltd (2005) 63 NSWLR 203; [2005] NSWCA 83 at [94]–[116].
152 Waterhouse v. Contractors Bonding Ltd [2013] NZSC 89, [2014] 1 NZLR 91 at [46].
153 [2013] NZSC 89, [2014] 1 NZLR 91.
154 ibid. at [28].
155 ibid. at [28], [28], n 29 and [76(f)], n 92.
156 Southern Response Earthquake Services Ltd v. Ross 2020 [NZSC] 126 at [86]; Note the Court in Waterhouse said litigation funding agreements should be disclosed 'where an application is made to which the terms of the agreement could be relevant': at [73] See also [75] and [76(c)]–[76(d)].
157 Waterhouse v. Contractors Bonding Ltd [2013] NZSC 89, [2014] 1 NZLR 91 at [67]–[69].
158 ibid. at [71].
159 High Court Rules 2016, rr. 14.1, 14.6 and 14.7.
160 High Court Rules 2016, Schedule 2 and Schedule 3.
161 High Court Rules 2016, r. 14.6(3)(a); see Kidd v. Van Heeren [2015] NZHC 3191 at [4], [6], [14]-[15] and [18].
162 High Court Rules 2016, r.5.45; see also Saunders v. Houghton [2009] NZCA 610, [2010] 3 NZLR 331 at [35]–[36] where the Court relied on its inherent jurisdiction as the basis for making an order for security against a plaintiff in a representative proceeding that was supported by a litigation funder.
163 Waterhouse v. Contractors Bonding [2014] 1 NZLR 91 at [29]; Walker v. Forbes [2017] NZHC 1212 at [71].
164 NZLC R147, Recommendation 109.
165 Waterhouse v. Contractors Bonding [2014] 1 NZLR 91 at [70].
166 High Court Rules 2016, r.5.45(3)(a)(ii).
167 Houghton v. Saunders [2014] NZHC 21 at [4]–[8]. Security was deposited in the trust account of the plaintiff's solicitors.
168 Strathboss Kiwifruit Ltd v. Attorney-General [2015] NZHC 1596.
169 Houghton v. Saunders [2019] NZHC 2007 at [47]–[51].
170 Houghton v. Saunders [2013] NZHC 1824 and White v. James Hardie New Zealand [2019] NZHC 188.
171 Houghton v. Saunders [2019] NZHC 2007 at [51].
172 High Court Rules, rr. 14.1; Waterhouse v. Contractors Bonding [2014] 1 NZLR 91 at [52]-[53]. See also NZLC IP45 [15.50]-[15.56] referring to Dymocks Franchise Systems (NSW) Pty Ltd v. Todd (No. 2) [2004] UKPC 39, [2005] 1 NZLR 145; Mana Property Trustee Ltd v. James Developments Ltd (No. 2) [2010] NZSC 124, [2011] 2 NZLR 25 at [11] and Falloon (as executors of the Estate of the Late Bligh) v. The Earthquake Commission [2020] NZHC 874.
173 NZLC R147 Recommendation 109(c).
174 NZLC R147 at Recommendation 112.
175 NZLC R147 at Recommendation 109(b).
176 NZLC R147 at [17.80].
177 See Ross v. Southern Response Earthquake Services Ltd [2021] NZHC 2454 at [23]–[29] for a precis of the procedural background of the Ross class action and the scope of the order sought.
178 In the context of a related novel application for a set aside order that was denied, the High Court in Ross v. Southern Response Earthquake Services Ltd [2021] NZHC 2454 at [63]-[64] made a favourable observation that the court had the power to make a CFO, a set aside order or a similar cost sharing order without determining the question.
179 Simons v. ANZ Bank NZ Ltd [2022] NZHC 1836.
180 Simons v. ANZ Bank NZ Ltd [2022] NZHC 1836 at [165]–[168].
181 Southern Response Earthquake Services Limited v. Brendan and Colleen Ross [2020] NZSC 126.
182 Southern Response Earthquake Services Limited v. Brendan and Colleen Ross [2020] NZSC 126, [82]–[83].
183 Southern Response Earthquake Services Limited v. Brendan and Colleen Ross [2020] NZSC 126, [81].
184 Southern Response Earthquake Services Limited v. Brendan and Colleen Ross [2020] NZSC 126, [82].
185 Southern Response Earthquake Services Limited v. Brendan and Colleen Ross [2020] NZSC 126, [60].
186 Southern Response Earthquake Services Limited v. Brendan and Colleen Ross [2020] NZSC 126.
187 Ross v. Southern Response Earthquake Services Ltd [2019] NZCA 431 at [110] and see also [105]–[106].
188 Simons v. ANZ Bank NZ Ltd [2022] NZHC 1836 at [164]–[168].
189 Simons v. ANZ Bank NZ Ltd [2022] NZHC 1836 at [160].
190 Simons v. ANZ Bank NZ Ltd [2022] NZHC 1836 at [165]–[168].
191 High Court Rules 2016, r 1.6(2).
192 Ross v. Southern Response Earthquake Services Ltd [2021] NZHC 2454 at [26]; Davaria Pty Ltd v. 7-Eleven Stores Pty Ltd (2020) 384 ALR 650, [21].
193 Davaria Pty Ltd v. 7-Eleven Stores Pty Ltd (2020) 384 ALR 650, [22]-[25] (referred to with approval in Simons v. ANZ Bank NZ Ltd [2022] NZHC 1836) Asirifi-Otchere v. Swann Insurance (Aust) Pty Ltd and Anor (No. 3) [2020] FCA 1885 (referred to with approval in Ross v. Southern Response Earthquake Services Ltd [2021] NZHC 2454).
194 Davaria Pty Ltd v. 7-Eleven Stores Pty Ltd (2020) 384 ALR 650, [28]–[30].
195 Lenthall v. Westpac Banking Corporation (No. 2) [2020] FCA 423, at [3]; Webster (as trustee for the Elcar Pty Ltd Super Fund Trust) v. Murray Goulburn Co-Operative Co Ltd (No. 4) [2020] FCA 1053 at [110]; and Uren v. RMBL Investments Ltd (No. 2) [2020] FCA 647, [48] (referred to with approval in Ross v. Southern Response Earthquake Services Ltd [2021] NZHC 2454).
196 Evans v. Davantage Group Pty Ltd (No. 3) [2021] FCA 70, [49].
197 Simons v. ANZ Bank NZ Ltd [2022] NZHC 1836 at [144].
198 id.
199 High Court Rules 2016, r 1.6(2).
200 Liverpool City Council v. McGraw-Hill Financial [2018] FCA 1289, [59] (per Lee J).
201 Uren v. RMBL Investments Ltd (No. 2) [2020] FCA 647, [65].
202 Simons v. ANZ Bank NZ Ltd [2022] NZHC 1836 at [145].
203 Cridge & Anor v. Studorp Limited (CIV-2015-485-594); and Fowler & Anor v. James Hardie New Zealand (CIV 2015-485-773).
204 White v. James Hardie CIV-2015-404-2981 (White proceeding).
205 Metlifecare Retirement Villages Limited v. James Hardie CIV-2015-404-3080 (the Waitakere proceeding).
206 Cridge v. James Hardie [2022] NZHC 2024.
207 Cridge v. James Hardie [2022] NZHC 2024 at [16].
208 High Court Rules, r. 1.2.
209 Southern Response Earthquake Services Limited v. Brendan and Colleen Ross [2020] NZSC 126, at [36][40].}