Supreme Court Orders First Opt-Out Class Action in New Zealand: Southern Response Earthquake Services Limited v Ross

Abstract

2020 was a big year. From a socio-legal and political perspective, many legislatures and judiciaries around the world have dealt with issues arising from national elections, a global pandemic, and collective action reform. In Australia, the parliamentary enquiry into litigation funding for collective actions dominated the legal headlines. In New Zealand, the Law Commission’s review of class actions and litigation funding commenced. Against this background, it is no surprise that one of the most important decisions in New Zealand’s class action jurisprudence was released by the New Zealand Supreme Court in November 2020. In Southern Response Earthquake Services Limited v Ross, the New Zealand Supreme Court unanimously allowed an opt-out class action to proceed for the first time despite the lack of a specific statutory regime to govern the management of class action litigation. In layman’s terms, an opt-out class action occurs where the plaintiff class includes everyone who meets the class certification criteria unless those individuals expressly choose to opt-out. In contrast, an opt-in class action only includes individuals in a plaintiff class who expressly opt-in to a proceeding. The implications of Southern Response are immense.