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Class action set to continue despite Banksia ruling

A CLASS action by Banksia investors is expected to continue despite the Victorian Supreme Court ruling that two lawyers representing the victims have conflicts of interest.

Melbourne solicitor Mark Elliott, who has been co-ordinating the Banksia class action on behalf of 16,000 people who invested in the failed finance company, said the case to claim $150 million would continue despite the Supreme Court ruling.

Mr Elliott said he might need to focus on being the funder for the class action but the case’s barrister, Norman O’Bryan, expected to be able to continue as senior counsel.

Mr Elliott said if he had to step away as a solicitor, he would appoint another solicitor in his place. Mr Elliott is a key investor in the company funding the Banksia case, BSL Litigation Partners, and Mr O’Bryan’s wife is also a significant shareholder.

The action to have the two lawyers restrained because of their conflicts of interests was initiated by Banksia’s founder and former managing director Pat Godfey with support from other defendants in the case.

In her judgment this week, Justice Anne Ferguson said Mr O’Bryan and Mr Elliott should be prevented from acting in the case “in the interests of the protection of the integrity of the judical process and the due administration of justice, and the appearance of justice”, she said.

Her ruling touched on the controversial area of “contingency fees” charged by solicitors for winning a case. They are banned in Australia but the Productivity Commission this year recommended they should be allowed.

Justice Ferguson said it would be “inimical to the appearance of justice for lawyers to skirt around the prohibition on contingency fees” by owning a large chunk of the litigation funder.

She said that under the “no win no fee” arrangement that the litigation fund had reached with investors, the fund might receive a fee of “tens of millions of dollars” if the class action was successful.

Mr Elliott said the class action was “going very well” despite the judgment about its legal representatives.

“Defences are due from all defendants on December 5.

“The case will proceed to trial before June next year and we are very confident of a good result.

“The recent examination of key TrustCo personnel (the trustees for Banksia) has given us much confidence in our case,” Mr Elliott said.

This story Administrator ready to work first appeared on Nanjing Night Net.

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