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Legislative Assembly for the ACT: 2004 Week 10 Hansard (Thursday, 26 August 2004) . . Page.. 4394 ..

will continue to have the best chances of being fully compensated for their injuries. That is appropriate, as it should not be up to the community to provide the financial support and care for that person when there is a contributory to the injury who has the capacity to pay.

The other important element is that consumer claims are also not subject to proportionate liability. This means that, if a person buys a product from someone and that product fails, causing economic damage, all contributors to that damage will continue to be subject to joint and several liability. I think there is a reasonable argument to support this part of the legislation, as there has been a serious attempt to strike a fair balance between the defendants and the plaintiffs. There is a clear indication that the concept of proportionate liability may have a meaningful effect on the insurance industry and that there is a solid body of case law establishing how proportionate liability is calculated.

However, the second half of the bill addresses the issue of professional standards. The Democrats have a number of concerns with the provisions regarding professional standards in this bill, and we will be opposing them in the detail stage. What the second half of this bill does is set up a system whereby professionals are protected from paying the full extent of the damages they cause.

While this scheme does not apply to personal injury claims, it will apply to all other instances of economic loss. This means that, if a professional is negligent or reckless and as a result causes economic damage to someone else, they will not be liable for the full cost of the damage. This is in contrast to proportionate liability where, although one person may not be liable for the full extent of the loss, the sum of all the defendants will be liable for the total amount of damage. There is not even a consumer protection clause in this section.

Under the professional standards part of this bill, suddenly plaintiffs may not be fully compensated for the damage that they have sustained. This section causes particular concern, as it will be those who have lost the most who suffer worst under this law. I think it is unfair and it is bad law to suddenly introduce a concept where people and corporations do not have to be fully responsible for their actions. Currently, if someone causes damage, they are liable for that damage—full stop. It is ridiculous to say that, if they cause a lot of damage, they are somehow less responsible. But that is what this bill puts forward.

The supposed trade-off for this erosion of plaintiffs’ rights is that professionals will be required to carry professional indemnity insurance and they would have to implement risk management strategies. What this would entail is not clearly articulated in the bill, as it is left to a professional standards council to interpret what that actually means. Furthermore, there is absolutely no guarantee that this will result in any real reduction in insurance premiums.

Basically, it is a system whereby Australian governments are trying to signal to world financial markets that Australia is a great place to offer insurance because our insurance laws are so lax. The government is trying to signal that to insurance companies by saying that they can collect bumper premiums and pay out less in compensation if they offer insurance in the territory. However, there is no evidence that anyone will pay any attention to this attempt to influence world insurance markets. With this legislation we

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