Key points
- Point 1
- The common issue requirement comes from s33C(1)(c) of the Federal Court of Australia Act 1976.
- Point 2
- The issue must be substantial — not trivial or peripheral to the overall claims.
- Point 3
- Not every element of each claim needs to be common — individual issues are resolved separately later.
- Point 4
- A court can create subgroups when different groups of members share distinct common issues.
- Point 5
- The lead applicant’s lawyers must clearly identify and plead the common issues in the statement of claim.
Examples of common issues
Common issues can arise from:
- Whether a defendant’s product was defective — a factual issue common to all purchasers
- Whether a company’s disclosure was misleading — a legal question common to all investors who bought shares in the relevant period
- Whether a superannuation fund charged excessive fees — common to all members of the same product
- Whether a data breach breached APP 11 — common to all whose data was exposed in the same incident
Individual issues — resolved separately
After common issues are resolved at trial, individual issues (such as the amount of loss each group member suffered) are dealt with separately. This may happen through a subgroup trial, an individual claims assessment process, or as part of settlement distribution. Courts design this process to minimise cost and delay.
What happens if no common issue exists?
If a court finds that the claims do not share a genuine common issue — or that individual issues overwhelm the common elements — it may decertify the class action. This is rare but does occur. Affected group members would then need to pursue individual claims, or wait for restructured proceedings.