Victorian small businesses could wait years for answers on Covid payout

Judge tries to end government delays in a class action over lockdown losses for more than 1000 operators ‘hanging by their fingernails’.

A lone pedestrian crosses the road on August 06, 2020 during Melbourne’s stage four lockdown. Picture: Getty Images

The Victorian government is trying to delay by years a major class action brought by more than 1000 small businesses who say they are “hanging on by their fingernails” after the state’s 2020 lockdown left them suffering ongoing massive financial losses.

Small businesses involved argue the state’s deadly second wave of Covid-19 in 2020, and the proceeding 111-day lockdown, was the result of the government’s failure to make sure hotel quarantine guards were properly trained in infection prevention and control.

Daniel Andrews’ government has tried to have the class action tossed out since August 2020, but has twice failed after their application for a summary dismissal and attempt to have the case struck out were both thrown out.

Victorian Supreme Court Justice John Dixon sought to hurry up the “extremely slow” process during a hearing on Thursday morning, pencilling in the next court date for December 12, despite opposition from a government lawyer.

“I won’t be entertaining an argument that you need three more months,” Justice Dixon said.

“I feel the need to keep this moving.”

An empty Bourke St in Melbourne in July, 2020. Picture: AAP

Quinn Emanuel Urquhart & Sullivan partner Damian Scattini said the small businesses involved – of which there are about 1500 ranging from large organisations to dog groomers – deserved “to have their day in court” after government prosecutors failed twice to have the class action thrown out.

“We have always said that this class action should be heard as soon as practicable and many of our group members are hanging on by their fingernails,” he told The Australian.

Mr Scattini said the case could be delayed until 2025 after state government prosecutors attempted to argue the class action should be paused because the state is facing “serious” charges in another matter before the supreme court relating to the failed hotel quarantine scheme.

“We say that is a furphy. It’s the state of Victoria. Nobody’s liberty is at stake. At the end of the day even a guilty verdict will result in an accounting entry from one government department to another,” he said.

“Whereas we have tens of thousands of Victorians whose livelihoods and futures are at stake.”

The only real risk to the state government is reputational, Mr Scattini said. As well, any small parts of the defence that overlap with the criminal case could be redacted and not be publicly available.

“Any perceived risk to the state of Victoria’s criminal prosecution can be managed by the court,” he said.

Mr Scattini said while it was impossible to tell how much the government would be liable for if the class action was successful, it would be a “very large amount”.

The class action is open to any traders that experienced a financial loss as a result of the stage three or stage four restrictions implemented at the time, which included a night-time curfew, ban on leaving home – with the exception of exercise and grocery shopping, or in the event of an emergency – as well as a major industry shutdown.

Victoria’s second wave, which can be traced back to Covid-19 outbreaks transmitted from returned travellers to hotel quarantine staff, including security guards, claimed more than 800 lives.

A 2020 Hotel Quarantine Inquiry in which 63 witnesses gave evidence over 25 hearings, revealed that 99 per cent of Covid cases in the second wave could be linked to the botched quarantine program and ultimately no one person was found responsible.

Multiple former ministers, including former Victorian health minister Jenny Mikakos, who handed in her resignation following the hotel quarantine scandal, and former jobs minister Martin Pakula, are listed as defendants in the class action.

The matter will be heard on December 12, when the parties will find out if the case will be delayed.