Key points
- Most Australian Federal Court class actions use the opt-out model.
- In opt-out proceedings, you are a group member automatically if you meet the class definition.
- In opt-in proceedings, you must register or sign a funding agreement to be included.
- Opt-out deadlines are set by the court and are strictly enforced.
- Missing an opt-out deadline does not prevent you opting out — but you must apply to the court for leave.
How the opt-out model works
Under Part IVA of the Federal Court Act, group members are included by default. Once a class action is filed, the court publishes an opt-out notice specifying a deadline. If you wish to exclude yourself — to pursue your own claim or for any other reason — you must notify the court before that deadline. After the deadline passes, you are bound by the outcome of the proceeding, including any settlement.
How the opt-in model works
Some funded class actions, particularly those backed by litigation funders who require executed funding agreements, operate on an opt-in basis. You must actively register and sign a funding agreement to be included in the distribution scheme. If you do not opt in before the deadline, you may miss the right to participate — even if you would otherwise qualify as a group member under the class definition.
Why you might choose to opt out
- You have a large individual loss that warrants a bespoke claim with higher potential recovery.
- You have already retained a lawyer who is pursuing an individual matter.
- You disagree with the class action settlement terms and want to pursue your own case.
Before opting out, seek independent legal advice. Opting out means you cannot later participate in the class action settlement.
This article is general information only and does not constitute legal advice. ClassActions.com.au is an independent information service and is not a law firm. If you believe you may have a legal claim, consult a qualified Australian legal practitioner.