A class action on behalf of businesses who lost out after the Commonwealth pink batts home insulation was canned alleges the federal government engaged in unconscionable conduct.
Installers, manufacturers and business owners lost millions or were forced to close after the then-Labor government terminated the problematic Home Insulation Program following the deaths of four workers in 2009 and 2010.
They are suing the Commonwealth for compensation in the Victorian Supreme Court, with a trial expected to take place next year.
The Commonwealth set up, then shut down, the Home Insulation Program, a Rudd government initiative designed to stimulate the economy during the global financial crisis.
The plaintiffs allege they suffered financially because the program was terminated earlier than expected.
They have argued it was unconscionable for the Commonwealth to exercise its legal right to terminate the scheme before the expiration date, or to encourage the industry to invest in expanding their businesses to make, supply and install insulation.
However, the Commonwealth has argued it was at liberty to make and change policy for any reason, based on what is in the national interest.
On Thursday, the Supreme Court made rulings on the finer details that will be litigated at trial.
A royal commission set up by the coalition government and the subsequent establishment of a compensation scheme has not compensated businesses, lawyers for more than 100 people have said.
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