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(a) for the repeal of common law provisions (“joint and several liability”) dealing with awarding damages in relation to claims for economic loss and damages, with the exception of matters involving personal injury;
(b) for the replacement of those provisions with the principles of proportionate liability;
(c) for the repeal of sections 154-158 of the Building Act (and for transitional matters arising from that repeal); and
(d) for the retention of the joint and several liability for those respondents who have intended to cause, or who have fraudulently caused, loss or damage.
Notes on clauses
Part 1 –Preliminary matters
Part 1, containing clauses 1-5, deals with machinery, definition and application provisions.
Clause 1. Short Title
Clause 1 sets out the name by which the legislation will be known, namely the Proportionate Liability Act 2005.
Clause 2. Commencement
Clause 2 provides that the legislation is to commence on a day to be fixed by the Administrator.
Clause 3. Definitions
Clause 3 contains definitions of the following terms:
“apportionable claim” (See used in clause 3 (definition of “proceeding” and clauses 5-18).
“concurrent wrongdoer” (See used in clauses 6-7, 10-13 and 15-16).
“court” (See used in clauses 11-13).
“damages” (See used in clauses 4, 6, 15-16 and 19).
“defendant” (See used in clauses 11-13 and 15).
“economic loss” (See used in clause 3 (definition of “loss or damage”) and in clause 19).
“loss or damage” (See used in clause clauses 5, 6-9, 13 and 16).
“proceeding” (See used in clause 3 (definition of “defendant”) and clauses 8-16).
Clause 4. Apportionable claims to which Act applies
Clause 4(1) provides that the Act is only to apply to claims that occur wholly or partly after the commencement of the legislation. The intention is that the legislation will not have retrospective operation in respect of injuries that occurred prior to the commencement of the legislation.
Clause 4(2) contains a definition of the term “apportionable claim”.
Subject to clause 4(1), 4(3) and 4(4), the intent of Act is to cover all claims for non personal injuries whether arising under common law or statute.
Clause 4(3) sets out some claims that are not “apportionable claims”. These include claims arising from personal injuries, claims under provisions of the Consumer Affairs and Fair Trading Act relating to unsafe products and claims excluded by the Regulations in accordance with clause 4(4).
Clause 4(4) provides that the Regulations may provide for other claims that are not apportionable claims.
Clause 5. Act binds Crown
Clause 5 states that the Act applies to the Crown.
Part 2 – proportionate liability
Part 2, containing Divisions 1-4, clauses 6-16, deals with the application of the principles of proportionate liability to apportionable claims.
Division 1 - Preliminary
Clause 6. Concurrent wrongdoers
Clause 6 defines the term “concurrent wrongdoer”. It is intended to describe persons who have separately or jointly contributed to loss or damage.
Clause 7. No apportionment for loss caused intentionally or fraudulently
Clause 7(1) defines the term “excluded concurrent wrongdoer” for the purposes of clause 7(2)-(3).
Such a wrongdoer is a person who intended to or fraudulently caused damage. Accordingly, the principles of proportionate liability will only apply to “accidents” and will not apply to incidents where there is a criminal or quasi criminal element.
Clause 7(2) and (3) provide that Part 2 of the Act does not limit the liability of “excluded concurrent wrongdoers” and that the liabilities of such persons are to be determined in accordance with the legal rules that, but for Part 2 of the Act, would have applied.
Clause 7(4) provides that the liability of a person who is a concurrent wrongdoer, in relation to a matter where there is also an excluded concurrent wrongdoer, is to be determined in accordance with Part 2 of the Act.
Division 2 – General provisions for proceedings
Clause 8. Determination as single claim if more than one cause of action
Clause 8 states that where there are two or more apportionable claims, the Court is to determine liability as if the claims were a single claim.
Clause 9 Determination of apportionable claim and other claim
Clause 9 states that where there is an apportionable claim and a claim that is not apportionable, then the apportionable claim shall be dealt with in accordance with Part 2 and the other claims shall be dealt with in accordance with the legal rules that, but for Part 2 of this Act, would have applied.
Clause 10 No need for all concurrent wrongdoers to be parties
Clause 10 provides that Part 2 applies to proceedings even if all of the alleged concurrent wrongdoers are not parties to the proceedings.
Clause 11. Joining concurrent wrongdoers as defendants
Clause 11 provides that the court may permit other concurrent wrongdoers to be joined as parties to the proceedings.
However, this power cannot be exercised in respect of a person who was a defendant in previously concluded proceedings in respect of the same matter.
Clause 12. Costs order if failure to inform of concurrent wrongdoers
Clause 12 imposes potential liability costs on defendants if they fail to inform the plaintiff of the identity of any other persons who may have also contributed to the damage. If the defendant fails to do this he or she may be liable for any unnecessary costs incurred by the plaintiff as a result of being unaware of the other defendant(s).
Division 3 – Determination of liability in apportionable claims
Clause 13. Determination of liability of concurrent wrongdoers
Clause 13 sets out the principle that the liability, for damages, of concurrent wrongdoers is proportionate to their share of responsibility for the acts and omissions that led to the damage. However, this principle does not affect the law relating to contributory negligence (as set out in Part 5 of the Law Reform (Miscellaneous Provisions) Act.
Clause 14. Other liability not affected
Clause 14 provides that the Act does not affect liability for various other kinds of liabilities governed by other principles namely:
(a) liabilities governed by principles relating to vicarious liability;
(b) liabilities governed by partnership law; and
(c) liability governed by other legislation.
Division 4 – After judgment given in proceedings
Clause 15 Concurrent wrongdoers not required to contribute or indemnify
Clause 15(1) provides that a concurrent wrongdoer, against whom judgment is given, cannot be required by any other concurrent wrongdoer to contribute to that other wrongdoer. This means that a concurrent wrong doer only faces the court once in respect of an apportionable claim.
Clause 15(2) provides that clause 15(1) operates subject any prior agreement that may have been made between the parties. This sub clause covers certain types of contracts (e.g. building contracts) which may contain clauses where one party agrees to indemnify the other.
Clause 16. Subsequent actions
Clause 16(1) states that a plaintiff who has taken action against a concurrent wrongdoer may take separate action against other concurrent wrongdoers.