Class Actions and Litigation Funding?

Kalev Crossland Partner

2High Court Litigation

$300 - $500K for 2 or 3 week trials

Insurer - effectively limitless war chest

2 years wait

3High Court litigation

1/3 – 2/3 costs back $150k – $250k dead money

even if win Life frozen

4High Court litigation

Inequality: pre-trial; power lawyeringmediation

Insurers repeat and well-versed in court cases

5Group Actions

Group Actions – 2 types Class Actions vs Representative Actions

Class action commonality derived from nature of the parties Representative actions commonality derived from nature of the issues NZ – only representative actions but courts flexible

6Representative Actions: requirements

Group capable of clear definition : e.g people insured with IAG for home and contents

Common issue: eg underscoped repairs with insurer using MBIE guidelines instead of policy standard – LMG + resin instead of new foundation

Chosen representative must adequately embody the group (eg Cam Preston in SR action)

7Group Actions: further considerations

Doesn’t matter that individuals may need separate assessment after common issue ruled on by Court

Doesn’t matter relief relates to separate contracts: eg different variants of same policy but same issues still arise (eg as when new)

Identity of some members unknown (can join action after case filed; eg EQC and SR actions) – limitation

Can have subgroups

8Group Actions: Why?

Aggregating lots of smallish claims into one big one together makes litigation costs relatively small and thus more economic

Also levels playing field – prevents insureds being picked off

Destresses – support aspect via a group

Group committee

9What is litigation funding?

Enables a plaintiff to sue without having to pay

No win, no fee from many fundersPlaintiff protected from costs award if

case lostFunder posts security

10Litigation Funding: Why?

Access to justice Allows claims that would not be brought to occur

Enables claimants to transfer risk and cost of litigation while still benefiting from proceeds of a win

Access to experienced lawyers and experts

11Team

Sarah Miles Kalev Crossland and Shieff Angland Neil Campbell QC University of Canterbury Law Students Various engineers, QS, surveyors Collaborate with legal academics

12Where to from here?

LPFNZ based litigation funder In serious talks LPF – doing PSA kiwifruit claim, highly

credentialed directors Gather claimants Identify common claims

13What does litigation funder need?

Identified claims Legal opinions on claims Expert opinions on claims Claimants? Online survey Details on Sarah’s blog

14What classes of claims and a new remedy?

Building settlement: floodplain datum MBIE guidelines versus policy standard Failed repairs Unjust cash settlements

Remedy: Stripping insurers of profits generatedfrom delayed payment and lowball settlementsCf Judicature Act

15How it would work

Members sign up online 1 page document

Interviewed, documents collected and collated Submit application to LPF File claim and permission as representative action Dedicated website/app Info and updates Litigation committee

16

Kalev Crossland Partner