Page 5287 - Week 17 - Thursday, 13 December 1990
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Clause 57
MR STEVENSON (9.56): My major concern with this clause was that there may be a situation where justice may not be done because either a member of a board or a committee or the board itself was not able to be sued. I am assured by the Minister and the legal department that that is not the case; that there is no single situation where either a member or the board could not be sued. However, there are some points that I wish to make along that line.
Concerning the idea of good faith for an individual member in clause 57(1), that good faith does not actually include negligence, so someone could well act in good faith and be absolutely negligent. I think the incentive to accept greater responsibility would be better if someone was also responsible, personally, for personal negligence. That is, of course, the situation in a business matter; if someone is a company director and is negligent, though he acts in good faith, he certainly would be held to be negligent.
Another situation could occur if someone who is a board member is negligent, but is under the protection of the good faith clause. In that case the board is going to use public money to cover his negligence, and I think perhaps it would be reasonable if the public did not have to pay for personal negligence by members of the board.
MR DEPUTY SPEAKER: Mr Stevenson, I am sorry to interrupt you, but I take it that you are not now moving your amendment?
MR STEVENSON: I am still moving it.
Mrs Nolan: You have changed your mind again.
MR STEVENSON: No, I did not change my mind. I intended to move it. I never said that I would not. What I said was that I have been assured that the major reason why I was moving it is not a concern. There are also other reasons why I will move it.
One of the suggestions is that, if we do not protect board members from personal liability, they will not serve on a board. I do not necessarily think that is a compelling argument. I think that because of the prestige involved, because of the personal power involved, and because of the potential of money - not necessarily by being paid, because in this case they are not - being a board member would certainly not do someone's future job prospects or career prospects any harm.
The major point is that, if someone can sue a member, if he or she is held to be acting outside his or her responsibility and hence is negligent, or if the board is vicariously responsible, even if the member is not in some
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