The Court exercised its power under s 33ZDA(3) of the Supreme Court Act 1986 (Vic) to further amend a group costs order from 17.392% to 13.253% of the $87 million settlement sum after the law practice disclosed an inadvertent error in its financial modelling that had understated its internal rate of return. The Court held that the power to amend under s 33ZDA(3) is not constrained by the percentages in the law practice's original forward-looking risk assessment, and that the proper starting point for amendment is the existing variation order rather than the original GCO. The Court rejected the argument that a GCO percentage of 13.253% would disincentivise early settlement, finding the percentage still reflected an IRR materially above the 75th percentile modelled at the time of the original GCO, and noting the statutory obligation under s 22 of the Civil Procedure Act 2010 (Vic) to use reasonable endeavours to resolve disputes by agreement.
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