NEW ZEALAND Trends and Developments Contributed by: Shane Campbell and Thomas Westaway, Campbell Westaway
preceding decade, with plaintiffs receiving nearly half of all recoveries. The judicial framework New Zealand’s governing framework has developed through case law rather than statute. Saunders v Houghton [2009] 3 NZLR 331 (CA) confirmed the permissibility of funding arrangements, with legality assessed by reference to abuse of process. Water- house v Contractors Bonding Ltd [2014] 1 NZLR 91 (SC) established the disclosure framework and con- firmed that any broader supervisory jurisdiction is a matter for Parliament. Southern Response Earthquake Services Ltd v Ross [2021] 1 NZLR 117 (SC) endorsed opt-out representative orders, enabling aggregation of an entire affected class without individual opt-ins and opening the commercial conditions for funded rep- resentative litigation to operate at scale. The frame- work that has emerged is permissive in orientation and deliberately limited in regulatory scope. Recent developments The past two years represent an inflection point. A sequence of rulings across three proceedings has tested the boundaries of the court-made framework, surfaced its unresolved questions, and signalled the directions in which the market is moving. Simons v ANZ Bank New Zealand Ltd [2024] 3 NZLR 485 marked a significant shift in the framework’s com- mercial architecture. The Court of Appeal confirmed the High Court’s jurisdiction to make common fund orders in representative proceedings, binding all class members to contribute proportionately to the funder’s commission from any recovery regardless of whether they have individually signed a funding agreement. The decision resolved a material friction point in the economics of funded opt-out actions, providing com- mercial certainty at the outset of proceedings rather than leaving funder remuneration contingent on indi- vidual sign-up rates. The Court held that such orders should be made as early as possible, on the basis that delayed certainty places access to justice at risk. The Supreme Court declined leave in December 2024. The practical significance followed quickly. In October 2025, ASB Bank agreed to pay NZD135.6 million to settle the related banking fee proceedings; the High
Court approved that settlement in January 2026, with LPF Group receiving approximately NZD33.6 million in costs and fees from the resolution sum. For prac- titioners advising on the structure of representative proceedings, the ASB proceedings have become the clearest available illustration of the common fund order framework operating end to end. In May 2026, the High Court granted summary judg- ment for the representative plaintiffs on the substan- tive CCCFA claim, holding that ANZ’s disclosure breach extinguished borrowers’ liability for all costs of borrowing during the breach period and that no quantum meruit claim was available to recover them. ANZ has indicated it is considering an appeal. The representative plaintiffs were directed to receive a refund of NZD32,728.42 on costs of borrowing aris- ing from a disclosure error averaging NZD2.34 per fortnight. Multiplied across a class of approximately 17,000 borrowers, the aggregate stakes illustrate the commercial conditions that continue to attract funders to the jurisdiction. The resolution of that commercial uncertainty has shifted the market’s attention to what funded rep- resentative litigation can achieve at scale. Gielen v Johnson & Johnson (New Zealand) Ltd [2026] NZHC 758 is the clearest current illustration of where that frontier now sits. The High Court granted representa- tive and common fund orders in proceedings brought on behalf of consumers who purchased cold and flu products containing phenylephrine (a drug found to be no more effective than a placebo when taken oral- ly). If the proceeding advances on an opt-out basis, it is expected to be one of the largest representa- tive actions in New Zealand’s legal history. Applying Simons, the Court granted the common fund order while reserving the question of aggregate damages for trial. That question has no clear statutory foundation in New Zealand, and its resolution will carry signifi- cant implications for both the commercial viability of funded representative proceedings and defendants’ ability to quantify their exposure. Smith v Fonterra Co - operative Group Ltd [2025] 3 NZLR 22 (HC) adds a further dimension to an increas- ingly consequential body of funded litigation. The proceedings, in which Mr Smith alleges that seven
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