Lead applicant and senior elder of the Gooniyandi People, Mervyn Street, said he began working when he was around 10 years old but did not start receiving wages until two decades later.

The settlement included a public apology in the Legislative Assembly and further comments from West Australian Premier Roger Cook.

“I apologise to the Aboriginal men, women and children who worked in Western Australia between 1936 and 1972, often for decades, for no pay or not enough pay,” Cook said following the public apology.

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“We acknowledge that many of these people have not lived to see this day. For their family members who remain, we are sorry for the hurt and loss that your loved ones suffered.”

Justice Bernard Murphy said the stories he heard will “stay with him forever”, and he expressed his apology for the First Nations people who were “so disgracefully mistreated” during this time.

He also noted the proposed settlement would be a “substantial discount” on any full compensation, plus interest.

While Justice Murphy accepted Shine performed work on behalf of the applicants “to a high standard”, he was taken aback by the enormous costs the firm accumulated throughout the proceedings.

Originally, Shine proposed legal costs of $33,252,230. When broken down, this sum included $18,209,125 for pre-settlement work and another $14,950,128 for post-settlement work.

In a belated move, Shine offered to reduce its legal fees to $29.25 million, but the costs referee recommended the court approve the firm’s total legal fees in the total sum of $31.5 million.

Before the report and discount, Shine had run up $12 million in fees, minus disbursements, but including uplift charges in the post-settlement registration process. Most of this was done by clerks.

While the figure was lowered to $8.8 million, Shine charged another $1.43 million in fees for the opt-out and earlier class member communications, also mostly done by law clerks.

“Standing back and taking an overall view, even having regard to the difficulties associated with the characteristics of the cohort of class members in this case, such fees are seriously overblown.

“It may not be the whole cause but it seems likely the costs blowout can be largely put down to excessive hourly rates charged by Shine for its unqualified law clerks. Even after the costs referee’s reductions, and discounts which Shine proposes, I consider the overall costs to be too high,” Justice Murphy said.

Justice Murphy reduced the legal costs to $27,501,618. With $15.4 million in costs included in the government’s settlement agreement, this means $13,146,618 will be taken from the settlement sum.

Before it offered to drop the rate, Shine was charging for unqualified law clerks at $251 per hour above the bottom of the party/party range, and $161 per hour above the top of the party/party range, for a clerk under the NSW Costs Assessment Rules Committee Guidelines.

The sum was also $211 per hour more than the Federal Court scale.

Legally qualified but not admitted clerks were working at $260 per hour above the bottom of the party/party range and $41 per hour above the top of the party/party range under the same guidelines. It was also $71 per hour more than the Federal Court scale.

“Even allowing for the increased difficulty arising from the characteristics of the cohort of class members, the registration work in this case should not command such top of the market hourly rates,” Justice Murphy said.

He added it would have been “far from unusual” for the work to be performed by call centre staff, and it was “necessary for such work to be performed by other types of employees or contractors if Shine proposed to charge such high hourly rates for its law clerks”.

To justify the rate charges, Shine handed up examples of billing entries, which included clerks working with class members to “rectify outstanding issues, including obtaining current identification documents and obtaining outstanding information”.

Justice Murphy rejected this.

“Contrary to the thrust of Shine’s contentions, that is work of a type that one could see competent and well-trained call centre staff undertaking. None of it involved a ‘work history’ from a person as was suggested in the hearing,” Justice Murphy said.

To the extent the work was performed by legally qualified law clerks, Justice Murphy said he could not accept a degree was needed to undertake the work associated with the registration process.

Justice Murphy added Shine should have told the court of its expenses before it “ran up such enormous costs post-settlement”.

“Had the court been approached, I expect that a significantly less expensive solution could have been found,” Justice Murphy said.

“For example, it might have been appropriate to engage local Indigenous representatives on weekly or monthly contracts rather than hourly rates; or to engage a claims administration service. It might have been appropriate to take a less ‘Rolls Royce’ approach.

“Shine needed to give greater attention to whether there were cheaper or more efficient ways of achieving a similar outcome, and to keep a much tighter grip than it did on the costs associated with the registration process.”

There was also a question about the funding commission for LLS Fund Services, which sought reimbursement of $1,045,000 in premiums for after-the-event (ATE) insurance, $13,358,858 it paid to Shine, and a common fund order of 20 per cent of the settlement.

Assuming there are 8,750 members, the common fund order of 20 per cent would see $31.955 million taken from the settlement sum.

Justice Murphy said this was not fair and reasonable in the circumstances of the case, and instead elected 16 per cent, which represents “a commercially realistic return and properly reflects the costs and risks taken on by the funder”.

46 members complain about settlement

The litigation heard claims from the applicants that were “at the high-end of legal complexity”, with some attended to by “considerable difficulty”.

Many of the legal issues involved were novel, and Justice Murphy predicted that no matter which party emerged the winner, there would have been an appeal to drag out the litigation even further.

Considering the complexity and its likely duration, Justice Murphy said this “weighed heavily in favour of approving the settlement”.

However, 46 people made written objections to the proposed settlement, and seven voiced their objections in oral submissions.

Justice Murphy said many submissions were “powerfully made”, and he was touched by the “anguish and hurt some objectors expressed”. He also noted their emotional submissions were a reminder of the importance of “acknowledging the occurrence of those wrongs”.

Further, he said their objections were “readily understandable”.

“The proposed settlement does not come near to full compensation for the economic loss suffered by unpaid or underpaid Aboriginal workers during the claim period – but it does not necessarily follow from that that the objections justify refusing to approve the proposed settlement,” Justice Murphy said.

This was particularly because the risks in this case meant it was impossible for Shine’s lawyers to be confident of success, and there was a “significant” chance the case could have failed, or the class members would have received much less than the settlement.

Justice Murphy also noted many of the objections considered the settlement sum in the context of the “harsh and discriminatory treatment” some people faced during the claim period.

“But the proceeding only raises claims regarding the non-payment or underpayment of Aboriginal workers for the work they performed during the claim period; it does not seek compensation for the other mistreatment they suffered,” Justice Murphy said.

The case is Street v State of Western Australia [2024] FCA 1368.