THE whiff of diesel fumes which permeated the wallets of Volkswagen Group vehicle owners in Australia is being cleared at last after lawyers in a class action representing about 100,000 owners agreed to a settlement.

The move ends almost four years of action by Maurice Blackburn Lawyers and follows some controversial courtroom tussles but still leaves Volkswagen Group Australia (VGA) facing a second case lodged by the Australian Competition and Consumer Commission (ACCC).

Maurice Blackburn principal lawyer Jason Geisker this week told GoAutoNews Premium that the final amounts for vehicle owners will depend on a range of factors, including the number of claimants ultimately coming forward to participate in the settlement.

He said there were some group members who last year had elected to opt out of the proceeding but did not discuss how many owners would not continue.

The longstanding process moved to a full ‘stage one’ trial last year and the ‘stage two’ trial was due to begin later this month.

But Maurice Blackburn Lawyers then informed the Federal Court in Sydney that agreement had been reached with VGA to resolve the matter before incurring further trial costs.

In a statement, the legal firm said the agreement in principle would see a minimum of $87 million available to affected Australian motorists, with that number able to rise to as much as $127 million depending on the final size of the claimant group.

“In addition, the defendants will also pay the plaintiffs’ legal costs once they are determined by the court,” Maurice Blackburn lawyers said.

The class action lawsuits filed by the lawyers on behalf of Australian customers concern about 100,000 Volkswagen Group vehicles in Australia fitted with the EA189 diesel engine.

Maurice Blackburn Lawyers said that if all affected vehicles participate, each owner could expect a payment per vehicle of about $1400.

They said the settlement had to be confirmed by the Federal Court of Australia. Volkswagen expects the proceedings will be concluded in 2020.

In a statement, VGA said: “Volkswagen Group has reached a comprehensive in-principle settlement with the class action plaintiffs in Australia.

“This is a significant step towards fully resolving the diesel lawsuits in Australia, subject to approval by the Federal Court of Australia. Volkswagen views the in-principle settlements as a further step towards overcoming the diesel issue.”

The ACCC has mirrored the timetable of the class action. This week, the ACCC told GoAutoNews Premium that the matter went for case management on Monday, September 16 and was to be reviewed in a week’s time.

The results of that meeting would be the subject of further comment by the ACCC.

On September 16, Jeremy Kirk SC for the ACCC indicated they were very close to reaching an agreement with Volkswagen to settle the ACCC case as well.

The extra week was agreed to discuss an agreement on final terms and the ACCC is then expected to announce if these discussions have led to a settlement or if its trial will proceed.

The settlement agreement must be approved by the court before any payments can be made to affected drivers and comes without admission of liability from Volkswagen.

Maurice Blackburn Lawyers principal lawyer Julian Schimmel, in a statement from the legal firm, said it was a significant victory for motorists “who for years had been trying to pin down the car-maker to get some accountability in Australia”.

“This is an important step in providing a measure of justice and redress to the thousands of Australian motorists who claim they were financially impacted by the diesel emissions issue,” Mr Schimmel said.

Lead plaintiffs Alister Dalton (Volkswagen), Steven Roe (Skoda) and Robyn Richardson (Audi) have endorsed the resolution as a prudent step and a hard-fought win for drivers.

The legal firm first sought compensation for its Australian clients in November 2015. It had signed up 18,000 owners and lessees of Volkswagen Group brands Volkswagen, Skoda and Audi, but said it was representing about 100,000 national owners of the three brands.

At the time, it did not discuss any financial value on the claims although it took precedent from action in Canada where Volkswagen made a $A287 million settlement to owners of 3.0-litre models in January 2015. It was the second payment made by Volkswagen and brought the total bill of $A2.4 billion.

The stage one trial brought some moments of controversy to the drawn-out issue.

In March 2018, Volkswagen Group Australia was accused in court by a Federal Court judge of being “quite silly” when it took the bizarre step of objecting to its own witness.

Volkswagen was defending the class action when the company told Justice Lindsay Foster in the Federal Court in Sydney that the car-maker’s key witness, Volkswagen AG manager of the powertrain development department Dr Dirk Neumann, was not “authorised” to speak on the issue.

In March 2018, GoAutoNews Premium reported that Dr Neumann was expected to give evidence about how Volkswagen’s vehicles came to be operated in two modes. But shortly before the trial, Volkswagen chose not to call him as a witness.

In the event, Justice Foster overruled VW’s objections to its own evidence, saying that the evidence of how the vehicles operated would be admitted and exposed for scrutiny and consideration in the case.

By Neil Dowling