NEW ZEALAND Trends and Developments Contributed by: Shane Campbell and Thomas Westaway, Campbell Westaway
Of the Commission’s recommendations, three bear directly on the pressure points the courts have now mapped. The abolition of the maintenance and cham- perty torts would remove the background uncertainty described above and align New Zealand with the position taken decades ago by its closest comparator jurisdictions. A court oversight model would require funding agreements in class actions to obtain approv- al as fair and reasonable before becoming enforce- able, giving judges a structured mechanism to pro- tect class members’ interests. The establishment of a public class action fund would extend the access to justice benefit of the funding market to claims the commercial market cannot support. The government accepted these recommendations in principle in 2022. Its subsequent conduct has been more equivocal than that acceptance suggested. In 2025, it introduced the Credit Contracts and Con- sumer Finance Amendment Bill, which included provi- sions designed to retrospectively amend the consum- er finance provisions at issue in Simons and would have materially altered the remedies available to the plaintiff class in live proceedings. Following public submissions, the select committee recommended the representative action be expressly excluded; the government accepted that recommendation. Parlia- ment declined to intervene against funded litigation when directly confronted with the consequences of doing so, while remaining equally unwilling to provide the framework the courts have identified as necessary. The May 2026 announcement represents a departure from that position, though not toward the framework the Commission envisaged.
The past two years have made plain the tension between judicial willingness and legislative capac- ity. Courts have been sympathetic to the access to justice concerns before them but have lacked the statutory tools to act on that sympathy. Funders and defendants cannot reliably price their exposure with- out a legislative framework to resolve it. Ultimately, litigants bear the cost of that gap. Their access to jus- tice turns on commercial calculations that a regulatory framework is designed to moderate. The New Rules have sharpened that tension rather than resolved it. A civil justice system that has restructured its proce- dural architecture around access and proportionality has, by implication, placed those values at the centre of the broader questions the funding market raises. The government’s first engagement with the funded litigation landscape in this period has been directed at foreclosure rather than framework. The Law Com- mission’s 121 recommendations remain substantially unaddressed. The next period will test whether legis- lative attention actively shifts toward them. Outlook The pipeline of proceedings testing New Zealand’s current funding framework is active and significant. The trajectory of Smith v Fonterra toward its April 2027 trial date remains contingent on the government’s announced intention to legislate, a question unre- solved at the time of publication. If the proceedings continue, the funding questions that have attended them remain live. Gielen , if it advances on an opt- out basis, will be among the largest representative actions in New Zealand’s legal history. Both will test the court-made framework at the pressure points the courts have already identified. The central question for the market in the period ahead is whether Parliament moves to address those pressure points before the proceedings themselves force the issue.
399 CHAMBERS.COM
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