New South Wales Consolidated Acts

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MOTOR ACCIDENT INJURIES ACT 2017 - SECT 6.21

Costs penalty for unreasonable denial of liability

6.21 Costs penalty for unreasonable denial of liability

(1) If an insurer denies liability (whether for part or all of a claim), the claims assessor may, in assessing costs on the claim, impose a costs penalty under this section if the claims assessor is of the opinion that there was no reasonable basis for the denial of liability.
(2) There is considered to be a reasonable basis for a denial of liability only if the denial was based on provable facts and a reasonably arguable view of the law.
(3) The costs penalty that may be imposed on an insurer under this section is a penalty of up to 25% (imposed by increasing the costs to be awarded against the insurer, or decreasing the costs to be awarded in favour of the insurer, by up to 25%).
(4) In this section,
"costs" means costs for the provision of legal services (including disbursements).



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