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Legislative Assembly for the ACT: 2004 Week 06 Hansard (Thursday, 24 June 2004) . . Page.. 2737 ..

Incorporated documents

Attachment 1

Document incorporated by the Minister for Disability, Housing and Community Services, Minister for Urban Services, Minister for Police and Emergency Services, and Minister for Arts and Heritage

I present the Civil Law (Wrongs) (Proportionate Liability and Professional Standards) Amendment Bill 2004. The Bill will amend the Civil Law (Wrongs) Act 2002 to implement proportionate liability and professional standards in the Australian Capital Territory.

The Bill represents a further measure to deal with the problems experienced by the insurance industry since 2001. A combination of international, domestic and structural factors came together to produce a severe increase in premiums for liability classes of insurance in Australia. For some risks, liability insurance became completely unavailable.

To counteract the effect of the insurance crisis on the professional indemnity insurance market, the Standing Committee of Attorneys-General in August 2003 set out a nationally consistent basis for proportionate liability legislation and professional standards legislation and committed to legislative implementation. These initiatives target the problem of economic loss as a result of professional negligence and do not relate to claims arising from personal injury. The Standing Committee of Attorneys-General proposal is the culmination of a long process of national policy consultation aimed at dealing with the recent problems affecting the insurance industry in Australia and overseas.

The Bill will replace the use of the concept of joint and several liability as a means of compensating claimants with the concept of proportionate liability as a means for compensating claimants in legal claim for economic loss or property damage.

Proportionate liability means that in an action for damages for purely economic loss or damage to property where more than one person has caused the loss or damage, each defendant in the action is liable only to the extent of his or her responsibility for the loss or damage caused. This proposal does not extend to personal injury claims.

The Bill will also introduce professional standards for industry associations, such as compulsory professional indemnity insurance, continuing education, codes of conduct, disciplinary procedures and risk management strategies, in return for financial limits on liability for damages in relation to an action under the law of negligence, contract or misleading conduct for economic loss.

A Professional Standards Council, whose members will be appointed from the ranks of key Australian professions, will be established with the responsibility for overseeing the implementation of risk management strategies by professional groups in the Australian Capital Territory. The council will be funded on a “user pays” basis by fees paid by the professional associations which will be regulated under the legislation.

In preparing the professional standards legislation, due regard has been given to maximising the flexible application of the provisions to the professionals who will

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