Australian tort law


Australian tort law

Tort law in Australia is the body of precedents and, to a lesser extent, legislation, that together define the operation of tort law in Australia. A tort is a civil wrong, other than a breach of contract. Tort law is a way in which the law can interfere with relationships between private individuals to correct a form of conduct or wrong. A large number of torts exist, and they generally derive their legal status from the common law. Since a court can define an existing tort or even recognise new ones through the common law, tort law is sometimes regarded as limitless and adaptable to modern circumstances.

Australian perspective

Generally, torts are not defined within specific statute or legislation and have evolved through judge-made law, or common law. However, each state has also created statutes to override the common law, especially in the areas of negligence, personal injuries and defamation.

Australian tort law is heavily influenced by the common law in other countries, principally the United Kingdom, by virtue of Australia's colonial heritage. There is also a strong and recent trend for the Australian High Court to cite with approval many principles from the United States. However, as the High Court noted:

The history of this country and of the common law makes it inevitable and desirable that the courts of this country will continue to obtain assistance and guidance from the learning and reasoning of...other great common law courts. Subject, perhaps, to the special position of decisions of the House of Lords given in the period in which appeals lay from this country to the Privy Council, the precedents of other legal systems are not binding and are useful only to the degree of the persuasiveness of their reasoning. ["Cook v Cook" Cite Case AU|CLR|162|376|1986 at 390 (Mason, Wilson, Deane and Dawson JJ)]

There are some sharp distinctions in torts between the UK and Australia:

* In Australia, trespass to the person is dependent on the directness of the act interfering with the plaintiff's autonomy. Australian law does not require the wrongdoer to have intent to trespass (see "Williams v Milotin"). In the United Kingdom, intent is a crucial element (see "Letang v Cooper").

* If trespass is direct but unintentional, a plaintiff in Australia may pursue an action based on negligence. Because intent is a requirement under UK law, this type of action is not available in the UK.

* The onus of proof for trespass 'on the highway' is on the plaintiff at all times (see "Venning v Chin"). Consequently, in a public place the plaintiff must prove how there was a 'direct' and 'substantial' interference with their personal autonomy.

* A breach of non-delegable duty is not automatic on founding a cause of action against the primary tortfeasor. Fault on the part of the contracting party must be shown.

Limitation of actions

Another example of statutory modification of torts is the various Limitation of Actions Acts, which prescribe time limits within which litigation must be commenced, and extinguishing the cause of action (the legal basis for the claim) after the period lapses. The rationale of limitation periods was elucidated by McHugh J: ["Brisbane Authority v Taylor" (1996) 70 ALJR 866 at 871-2]

*As time goes by, relevant evidence may be lost.
*It is oppressive to a defendant to allow an action to be brought long after the circumstances which gave rise to it have passed.
*Limitation periods give certainty to people (especially businesses and insurers) in arranging their affairs and provisioning for their liabilities within a definite period.
*The public interest requires that disputes be settled as quickly as possible.

As a general rule, the limitation period on:
* property damage cases is six years in all jurisdictions; ["Limitation Act 1969" (NSW), s 14(1)(b); "Limitation of Actions Act 1974" (Qld), s 10(1)(a); "Limitation of Actions Act 1936" (SA), s 35; "Limitation Act 1974" (Tas), s 4(1)(a); "Limitation of Actions Act 1958" (Vic), s 5(1)(a); "Limitation Act 1935" (WA), s 38(1)(c)(vi); and "Limitation Act 1985" (ACT), s 11(1).]
* personal injuries is three years in New South Wales, Queensland, South Australia and Tasmania, ["Limitation Act 1969" (NSW), s 18A; "Limitation of Actions Act 1974" (Qld), s 11; "Limitation of Actions Act 1936" (SA), s 36; and "Limitation Act 1974" (Tas), s 5(1).] and six years in all other jurisdictions; and
* there are other limits on actions arising from eg contracts and building and construction cases. [See eg "Limitation Act 1985" (ACT), s 40.]

Some Common Torts in Australian law

*Trespasses
** against the person (assault, battery and false imprisonment)
** against chattels (personal property)
** to land
*Occupation or possession of land
** Private nuisance
** Cattle trespass
** Liability for animals (Scienter)
*Negligence
*Breach of public and statutory duties
** Public nuisance
** Breach of statutory duties
** Interferences with the judicial process
*Misrepresentation
** Deceit
** Innocent misrepresentation/negligent advice
** Defamation
** Injurious falsehood
** Passing off
*Intentional damage to economic interests
** Interference with contractual relations
** Conspiracy
** Intimidation
*Interference with employment and family relations
** Actions "per quod servitium amisit" (injuring an employee rendering them unable to perform services for their employer)
** Loss of consortium of a spouse

Recent developments

Invasion of privacy

In the case "ABC v Lenah Games Meats" in 2001, the High Court of Australia left open the possibility for development of a tort of invasion of privacy. The Court stated that it did not want to decide the matter at that time and only one member, Justice Callinan, gave any indication that such a tort may be acceptable [http://www.austlii.edu.au//cgi-bin/disp.pl/au/cases/cth/HCA/2001/63.html] . It held that "Victoria Park Racing v Taylor" did not inhibit the development of privacy law in Australia.

Since "ABC v Lenah Game Meats", the question of whether the breach of privacy was a valid cause of action has been entertained in at least two states. The most adventurous decision is arguably that of the District Court of Queensland in "Grosse v Purvis" [2003] QDC 151, in which Judge Skoien awarded damages for invasion of privacy. Conversely, the existence of the tort was questioned by Justice Gillard of the Supreme Court of Victoria in "Giller v Procopets" [2004] VSC 113, in which the Court doubted that that the law had 'developed to the point where the law in Australia recognises an action for breach of privacy' ("Giller v Procopets" at para 181).

Both of these cases were settled out of court and, as a result, will not proceed to appeal. Until this tort receives the attention of an Australian appellate court, the precedential value of "Grosse" and "Giller" is limited.

Negligence and the Ipp Review/Report

Negligence is a cause of action generally broken down into four component parts:
* a duty of care
* a breach of the duty of care through an action or omission
* harm
*a causal connection between the breach of duty and the harm

The Ipp Report

In 2002 the following factors affected the profitability of Australian insurers: [ [http://www.insurancereform.com.au Insurance Reform Campaign ] ]
*The worldwide increase in re-insurance costs after the World Trade Center attack on September 11, 2001;
*The collapse of discount Australian insurer HIH;
*Competitive pricing among Australian insurers producing lower premium income trends;
*A reduction in the value of and returns from global assets and investments; and
*High salaries paid to insurance executives. These factors provided upward pressure on premiums. Insurers also claimed that the personal injury compensation payments relating to motor accident, workplace and public liability insurance policies were becoming unaffordable. [ [http://www.onlineopinion.com.au/view.asp?article=1900 Alan Mason, Insurance Council of Australia] ]

This contention gained wide media and government support and the term "Insurance Crisis" was coined to describe conditions in the insurance market. No evidence was produced then or since that personal injury compensation claim payments had contributed to the "Insurance Crisis". Indeed some commentators described the crisis as "at best unproved and at worst self-serving rhetoric". [Henry Ergas, economist, Network Economics Consulting, Canberra]

The Commonwealth, State and Territory governments appointed panel of "experts" to review the law of negligence. It included a surgeon and a rural mayor. The panel was chaired by Justice David Ipp, a judge of the New South Wales Court of Appeal. The Review's primary purpose was to address the public view of escalating, "unsustainable" public liability insurance premiums and damages awards for those injured through another's fault."

The Terms of Reference for the panel's review were as follows:

The award of damages for personal injury has become unaffordable and unsustainable as the principal source of compensation for those injured through the fault of another. It is desirable to examine a method for the reform of the common law with the objective of limiting liability and quantum of damages arising from personal injury and death.

The assumptions in the Terms of Reference have been criticised by pro-consumer groups who assert that they were unsubstantiated and that insurers manipulated the "Insurance Crisis" to create hysteria among the public and panic legislators into making laws that had been on their wish list for decades. [http://www.tortreforminstitute.com.au/news.html#cll Tort Reform Institute - Latest News ] ] In its report released in October 2002, the panel proposed wide-ranging changes to limit: [cite web|url=http://revofneg.treasury.gov.au/content/review2.asp|title=Review of the Law of Negligence Report|date=2002-10-02|publisher=Commonwealth of Australia|accessdate=2008-09-12]
* the circumstances in which damages can be recovered negligence;
* the types and quantum of damage that can be recovered; and
* further increases in public liability insurance premiums.

The report and its recommendations were criticised by:
*Academics

The final Ipp report ...repeats and aggravates earlier errors... in a mistake even a first year student of economics would recognise... Precluding lawsuits where the underlying grievances are legitimate is merely a way of making relatively poor people worse off. - Henry Ergas, economist, Canberra

*Lawyers
The Ipp Panel has been asked to make recommendations regarding further limits on compensation for those injured through negligence. But we have still not seen any proof that negligence laws are the cause of the insurers' problems, and that cutting entitlements will improve the situation. There is still no evidence to show that cutting the compensation of injured citizens will reduce or contain insurance premiums. - Rob Davis, President, Australian Plaintiff Lawyers Association (APLA)

*Consumer organisations
The lack of competition in the Australian insurance market following the demise of HIH has seen predatory insurers slugging businesses, even those with no prior claims, with exorbitant premiums. Insurers are asking that they should be virtually claim proof but still want to collect huge premiums. The changes they want would leave individuals and families to suffer the consequences of reckless conduct while their profits will go through the roof. - Civil Justice Foundation

The Commission, in light of the lack of empirical data at present on the so-called 'litigation explosion' and associated claims ... recommends that caution should be exercised in implementing significant policy and other changes to address the situation. - The Australian Competition and Consumer Commission (ACCC)

An article in the Australian Financial Review of 11 November 2002 stated " [t] he report displays an alarming lack of insight into the economic and social issues concerning legal liability for reckless conduct. It contains many 'unfounded inferences' and 'recommendations are thrown around with little or no assessment of their consequences...".

Despite widespread criticism, the recommendations were largely adopted by Australian state governments. ["Civil Law Wrongs Act 2002" (ACT); "Civil Liability Act 2002" (NSW); "Civil Liability Act 2002" (WA); "Civil Liability Act 2002" (Tas); "Civil Liability Act 2003" (Qld); "Personal Injuries (Liability and Damages) Act 2003" (NT); and by amendments to the "Wrongs Act 1958" (Vic) and the "Wrongs Act 1936" (SA)] The Federal Government also responded by closing "loopholes" which allowed plaintiffs to turn to federal consumer protection legislation to recover compensation where that was barred, or made less attractive, by the states' "reforms". ["Trade Practices Amendment (Personal Injury and Death) Act (No. 2) 2004" (Cth)]

Effect of the "reforms"

The "reforms" [Consumer organisations ( [http://www.tortreforminstitute.com.au Tort Reform Institute] , [http://www.lawyersalliance.com.au/ Australian Lawyers Alliance] , [http://www.insurancereform.com.au/ Insurance Reform Association] ) argue the changes resulting from the Ipp Report are regressive and cannot be considered as reforms according to the strict meaning of the word.] have created notable controversy, because they were brought about following a concerted public relations and political lobbying campaign by insurance interests who claimed that there was a generalised 'litigation explosion' or 'litigation crisis' involving civil damages claims. Since this time, however, the Law Council of Australia has shown that there was no significant increase in the amount of personal injury court action in the years leading up to the Ipp Report. [ [http://www.lawcouncil.asn.au/get/media/2424209592.pdf National Trends in Personal Injury Litigation: Before and After "Ipp"] ]

In particular, there is anecdotal evidence that the Civil Liability Act 2002 (NSW) led as much as 10% of NSW barristers to allow their practising certificate to lapse. This is said to have occurred because, without negligence claims to litigate, barristers actively sought out other briefs in areas such as criminal law. Subsequently, there was a saturation of barristers in the most profitable areas of the law. Moreover, some barristers lacked sufficient experience in other areas to be effective counsel, and therefore sought to use their skills in other areas.Fact|date=January 2008

Whilst as a result of "Civil Liability Laws" there has unquestionably been a substantial decrease in personal injury tort claims since 2002 (and numbers will continue to dwindle as pre-2002 causes of action pass their limitation periods), insurance premiums have continued to rise. This has led to renewed calls for reversal of recent "reform" in the area, particularly from plaintiff's lawyers, consumer groups and others outside the insurance lobby, who perceive that valid claims are unable to succeed, that the new regime imposes unfair additional costs on claimants and other detriments.Fact|date=January 2008

Since "reform" by the "Civil Liability Acts" (caused by the Ipp Report), all three of the component parts above have been substantially modified [Needs clarification] , although much of the legislation is yet to be properly tested in appellate courts. The primary changes made by the "Civil Liability Acts" (resulting from the Ipp Report) also apply to professional liability for personal injury, and serve to reinforce the decision of the High Court in 'Rogers v Whitaker', in regard to negligent failure to advise, while reinstating the 'Bolam Test' in cases of negligent professional treatment.

"Civil Liability laws" are claimed to have eliminated 70-80% of Australian personal injury claims payments on business and household insurance policies. An economic effect of "Civil Liability laws" is to transfer of the financial burden of reckless conduct from the at-fault party and its insurer to the victim. It is also argued that the exemption of reckless enterprises from having to pay the true cost of injuries they cause amounts to a subsidy of those businesses.

Consumer groups contend the following consequences have resulted:
# businesses who refuse to invest in injury avoidance practices face no economic penalty when an injury results
# those who do invest in safety are penalised because of their increased cost of production relative to that of the unsafe competitor
# people who are injured through no fault of their own bear the lifelong cost of the injury
# some of the costs are transferred to the taxpayer through Medicare and public hospital treatment of victims

The aggregate of Australian insurance profits since the introduction of "Civil Liability laws" has exceeded $15 billion. In August 2007, QBE posted an annualised profit of $1.84 billion. [cite web|url=http://www.qbe.com/Version_2/HTML/reports/june2007/QBE_HY07_final_web_secure.pdf|title=Half Year Report 30 June 2007|publisher=QBE Insurance Group|accessdate=2008-09-12] Suncorp posted an annual record profit of $1.064 billion after-tax for the year to the end of June 2007. [ [http://suncorp.com.au/suncorp/news/2007.html 2007 Media Releases ] ] IAG booked profit of over $552 million [cite web|url=http://www.iag.com.au/results/reports/archive/html07/PDFs/Five_year_financial_summary.pdf|title=Financial Report|publisher=Insurance Australia Group|accessdate=2008-09-12] compared to $759 million for the 2006 year. [ [http://www.iag.com.au/results/reports/archive/html06/index.shtml IAG Annual Report 2006 - Home ] ]

In February 2006, the Chief Justice of Queensland Paul de Jersey AC told the Australian Lawyers Alliance that "Civil Liability laws" have "brought about marked erosion of a fundamental right to adequate compensation" for injury and that the critical issue now is "the need for active reconsideration of whether the so-called reforms have proven justified, or should be wound back". [ [http://www.lawyersalliance.com.au/news.php?show=releases&year=2006 Australian Lawyers Alliance: News & Media Releases ] ]

The Australian Lawyers Alliance, the Law Council of Australia and the Tort Reform Institute have called for reviews or repeal of "Civil Liability laws". The Insurance Reform Association has called for an inquiry into the conduct of insurers and their manipulation of the "Insurance Crisis".

Defamation

Since 2006, all Australian states have adopted uniform defamation laws. One of the major and most discussed changes concerned defences to publication of defamatory statements. After the reforms, defendants can defend a defamation case on the basis of truth alone (ie their comments were true). Prior to the legislative changes, a number of states (including New South Wales and Tasmania) required that comments be both true, and in the public interest or public benefit, to be protected.

Other changes created by the new uniform defamation laws include limits on the maximum payout available, limitation periods for defamation, and formal recognition to any apologies made by the wrongful party.

Wrongful life

A Wrongful life claim is one in which a child plaintiff brings an action against a doctor who negligently diagnosed the plaintiff's mother. Usually, the doctor failed to diagnose rubella during the first trimester, for which there is no cure and which will inevitably cause profound disabilities in the unborn child. Had the mother been correctly diagnosed, she would have exercised her legal right to abortion.

In May 2006, the majority of the High Court of Australia rejected wrongful life, refusing to accept that life can be considered a compensable harm. This means that children who are born disabled as a result of a doctor's (admitted) negligence cannot claim damages. ["Harriton v Stephens" [http://www.austlii.edu.au//cgi-bin/disp.pl/au/cases/cth/HCA/2006/15.html?query=harriton%20v%20stephens (2006) HCA 15] ] Parents are able to pursue 'wrongful birth' claims if the child (disabled or not) is the outcome of a negligently performed sterilisation procedure. (see Cattanach v Melchior). However, post "Civil Liability Act", they cannot recover the costs of raising the child. [cite web|url=http://www.austlii.edu.au/au/legis/nsw/consol_act/cla2002161/s71.html|title=New South Wales Consolidated Acts - Sect 71|publisher=Australasian Legal Information Institute|accessdate=2008-09-12]

Litigation

Tort law occupies much of the time of the various Magistrates', Local, District and County Courts and a substantial proportion of the time of the Supreme Courts of each of the states and territories. In addition, there are numerous specialist tribunals dealing with workers' compensation and other cases. Road accident victims are far more likely to make claims and receive tort compensation than any other group.Fact|date=January 2008 This predominance is due not so much to the law of torts, but the fact that liability insurance is compulsory by statute in all Australian states.

Legislative reform

1900s

Since the common law evolves slowly, legislative intervention has been necessary to keep torts in pace with social needs. The Workmen's Compensation legislation from 1897 is the most potent example of the necessity of tort reform. The combination of (a) increased risks for workers during industrialisation, and; (b) the refusal by common law courts to place the costs of workplace accidents on employers; forced parliaments to redress the defects and shift the costs of industrial accidents back to employers. [David Gardiner and Frances McGlone, "Outline of Torts" (2nd ed, 1998), Butterworths, at 33, citing "McGuire v Union Steamship Co of New Zealand Ltd" Cite Case AU|CLR|27|570|1920 at 578-83.] Legislation such as the "Trade Practices Act 1974" and the state Fair Trading Acts also impinged upon the traditional tort rules in commercial and property areas.

From the early 1980s legislative intervention attempted to reduce the high volume of litigation involving motor vehicle and industrial accidents. Parallel to the rise of Thatcherism in the United Kingdom, in all Australian states common law torts were significantly modified. Speedy "no fault" compensation was made available to workers and victims of motor vehicle accidents.Fact|date=January 2008

The decline of HIH Insurance, the Ipp Review and beyond

Since 2002 there has been an acceleration of legislative change, driven by a perceived crisis in the price and availability of insurance, which was largely blamed on the law of negligence. The issue became charged politically, reinforced by the direct liability of government and its role as a re-insurer of last resort. New South Wales, the most litigious state, [ [http://www.smh.com.au/news/National/NSW-slowest-in-catching-murderers-on-the-loose/2005/01/27/1106415736064.html NSW slowest in catching murderers on the loose - National - www.smh.com.au ] ] [cite web|url=http://www.riskinsite.com.au/sicorp_web/RiskInArchive/docarchive/GuideProcedure/THE%20CIVIL%20LIABILITY%20ACT%20RV4.doc|title=The Civil Liability Act|publisher=RiskInSite|accessdate=2008-09-12] [ [http://www.courtwise.nsw.gov.au/lawlink/supreme_court/ll_sc.nsf/pages/SCO_speech_spigelman_160704 Tort Law Reform in Australia - Supreme Court : Lawlink NSW ] ] had commenced legislative change prior to 2002. Following the collapse of HIH Insurance and the related escalation in insurance premiums in public liability and medical negligence, the NSW proposals were adopted more widely throughout Australia.Fact|date=January 2008 More on the Ipp panel, its report, the "Insurance Crisis" and Civil Liability laws above.

References


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