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New South Wales
Civil Liability Bill 2002
Contents
Page
Part 1 Preliminary
1 Name of Act 2
2 Commencement 2
3 Definitions 2
4 Act to bind Crown 3
5 Regulations 3
6 Notes 3
7 Savings and transitional provisions 3
8 Amendment of Acts 3
Part 2 Personal injury damages
Division 1 Preliminary
9 Application of Part 4
10 General regulation of court awards 5
11 Act does not give rise to any cause of action 5
Civil Liability Bill 2002
Contents
Page
Division 2 Fixing damages for economic loss
12 Damages for past or future economic loss--maximum for
loss of earnings etc 5
13 Future economic loss--claimant's prospects and
adjustments 6
14 Damages for future economic loss--discount rate 6
15 Damages for gratuitous attendant care services 7
Division 3 Fixing damages for non-economic loss
(general damages)
16 Determination of damages for non-economic loss 8
17 Indexation of maximum amount relating to non-economic
loss 10
Division 4 Other matters
18 Interest on damages 11
19 Third party contributions 11
20 Contributory negligence--claims under the Compensation
to Relatives Act 1897 12
21 Exemplary, punitive and aggravated damages 13
22 Court may make consent order for structured settlement 13
Schedules
1 Savings and transitional provisions 14
2 Amendment of Acts 16
Contents page 2
I certify that this PUBLIC BILL, which originated in the LEGISLATIVE ASSEMBLY, has
finally passed the LEGISLATIVE COUNCIL and the LEGISLATIVE ASSEMBLY of NEW
SOUTH WALES.
Clerk of the Legislative Assembly.
Legislative Assembly,
Sydney, , 2002
New South Wales
Civil Liability Bill 2002
Act No , 2002
An Act to make provision in relation to the recovery of damages for death or
personal injury caused by the fault of a person; to amend the Legal Profession
Act 1987 in relation to costs in civil claims; and for other purposes.
I have examined this Bill, and find it to correspond in all respects with the Bill as
finally passed by both Houses.
Chairman of Committees of the Legislative Assembly.
Clause 1 Civil Liability Bill 2002
Part 1 Preliminary
The Legislature of New South Wales enacts:
Part 1 Preliminary
1 Name of Act
This Act is the Civil Liability Act 2002.
2 Commencement
This Act is taken to have commenced on 20 March 2002.
3 Definitions
In this Act:
claimant means a person who makes or is entitled to make a claim for
personal injury damages.
court includes tribunal, and in relation to a claim for damages means
any court or tribunal by or before which the claim falls to be
determined.
damages includes any form of monetary compensation.
fault includes an act or omission.
injury means personal or bodily injury, and includes:
(a) pre-natal injury, and
(b) psychological or psychiatric injury, and
(c) disease.
non-economic loss means any one or more of the following:
(a) pain and suffering,
(b) loss of amenities of life,
(c) loss of expectation of life,
(d) disfigurement.
personal injury damages means damages that relate to the death of or
injury to a person caused by the fault of another person.
Page 2
Civil Liability Bill 2002 Clause 4
Preliminary Part 1
4 Act to bind Crown
This Act binds the Crown in right of New South Wales and, in so far
as the legislative power of the Parliament of New South Wales permits,
the Crown in all its other capacities.
5 Regulations
The Governor may make regulations, not inconsistent with this Act, for
or with respect to any matter that by this Act is required or permitted
to be prescribed or that is necessary or convenient to be prescribed for
carrying out or giving effect to this Act.
6 Notes
Notes included in this Act do not form part of this Act.
7 Savings and transitional provisions
Schedule 1 has effect.
8 Amendment of Acts
The Acts specified in Schedule 2 are amended as set out in that
Schedule.
Page 3
Clause 9 Civil Liability Bill 2002
Part 2 Personal injury damages
Division 1 Preliminary
Part 2 Personal injury damages
Division 1 Preliminary
9 Application of Part
(1) This Part applies to and in respect of an award of personal injury
damages, except an award that is excluded from the operation of this
Part.
(2) The following awards of damages are excluded from the operation of
this Part:
(a) an award where the fault concerned is an intentional act that is
done with intent to cause injury or death or that is sexual
assault or other sexual misconduct,
(b) an award to which Part 6 of the Motor Accidents Act 1988
applies or to which Chapter 5 of the Motor Accidents
Compensation Act 1999 applies (including an award to and in
respect of which that Chapter applies pursuant to section 121
(Application of common law damages for motor accidents to
railway and other public transport accidents) of the Transport
Administration Act 1988),
(c) an award to which Division 3 of Part 5 of the Workers
Compensation Act 1987 applies,
(d) an award in proceedings of the kind referred to in section 11
(Claims for damages for dust diseases etc to be brought under
this Act) of the Dust Diseases Tribunal Act 1989,
(e) an award comprising compensation under the Workers
Compensation Act 1987, the Workers Compensation (Bush
Fire, Emergency and Rescue Services) Act 1987, the Workers'
Compensation (Dust Diseases) Act 1942, the Victims Support
and Rehabilitation Act 1996 or the Anti-Discrimination
Act 1977 or a benefit payable under the Sporting Injuries
Insurance Act 1978,
(f) a sum required or authorised to be paid under an industrial
instrument within the meaning of the Industrial Relations
Act 1996,
Page 4
Civil Liability Bill 2002 Clause 9
Personal injury damages Part 2
Preliminary Division 1
(g) a sum payable under a superannuation scheme or any life or
other insurance policy,
(h) an award of damages of a class that is excluded by the
regulations from the operation of this Part.
(3) This Part extends to an award of personal injury damages even if the
damages are recovered in an action for breach of contract or in any
other action.
10 General regulation of court awards
A court cannot award damages, or interest on damages, to a claimant
contrary to this Part.
11 Act does not give rise to any cause of action
This Act does not create or confer any cause of civil action for the
recovery of damages in respect of an injury or death caused by the fault
of a person.
Division 2 Fixing damages for economic loss
12 Damages for past or future economic loss--maximum for loss of
earnings etc
(1) This section applies to an award of damages:
(a) for past economic loss due to loss of earnings or the deprivation
or impairment of earning capacity, or
(b) for future economic loss due to the deprivation or impairment
of earning capacity, or
(c) for the loss of expectation of financial support.
(2) In the case of any such award, the court is to disregard the amount (if
any) by which the claimant's gross weekly earnings would (but for the
injury or death) have exceeded an amount that is 3 times the amount
of average weekly earnings at the date of the award.
(3) For the purposes of this section, the amount of average weekly
earnings at the date of an award is:
(a) the amount per week comprising the amount estimated by the
Australian Statistician as the average weekly total earnings of
all employees in New South Wales for the most recent quarter
Page 5
Clause 12 Civil Liability Bill 2002
Part 2 Personal injury damages
Division 2 Fixing damages for economic loss
occurring before the date of the award for which such an
amount has been estimated by the Australian Statistician and
that is, at that date, available to the court making the award, or
(b) if the Australian Statistician fails or ceases to estimate the
amount referred to in paragraph (a), the prescribed amount or
the amount determined in such manner or by reference to such
matters, or both, as may be prescribed.
13 Future economic loss--claimant's prospects and adjustments
(1) A court cannot make an award of damages for future economic loss
unless the claimant first satisfies the court that the assumptions about
future earning capacity or other events on which the award is to be
based accord with the claimant's most likely future circumstances but
for the injury.
(2) When a court determines the amount of any such award of damages for
future economic loss it is required to adjust the amount of damages for
future economic loss that would have been sustained on those
assumptions by reference to the percentage possibility that the events
might have occurred but for the injury.
(3) If the court makes an award for future economic loss, it is required to
state the assumptions on which the award was based and the relevant
percentage by which damages were adjusted.
14 Damages for future economic loss--discount rate
(1) If an award of damages is to include any component, assessed as a
lump sum, for economic loss that is referable to the future, the present
value of that future economic loss is to be determined by adopting the
prescribed discount rate.
(2) The prescribed discount rate is:
(a) a discount rate of the percentage prescribed by the regulations,
or
(b) if no percentage is so prescribed--a discount rate of 5%.
(3) Except as provided by this section, nothing in this section affects any
other law relating to the discounting of sums awarded as damages.
Page 6
Civil Liability Bill 2002 Clause 15
Personal injury damages Part 2
Fixing damages for economic loss Division 2
15 Damages for gratuitous attendant care services
(1) In this section:
attendant care services means any of the following:
(a) services of a domestic nature,
(b) services relating to nursing,
(c) services that aim to alleviate the consequences of an injury.
gratuitous attendant care services means attendant care services:
(a) that have been or are to be provided by another person to a
claimant, and
(b) for which the claimant has not paid or is not liable to pay.
(2) No damages may be awarded to a claimant for gratuitous attendant
care services unless the court is satisfied that:
(a) there is (or was) a reasonable need for the services to be
provided, and
(b) the need has arisen (or arose) solely because of the injury to
which the damages relate, and
(c) the services would not be (or would not have been) provided to
the claimant but for the injury.
(3) Further, no damages may be awarded to a claimant for gratuitous
attendant care services if the services are provided, or are to be
provided:
(a) for less than 6 hours per week, and
(b) for less than 6 months.
(4) If the services are provided or are to be provided for not less than 40
hours per week, the amount of damages that may be awarded for
gratuitous attendant care services must not exceed:
(a) the amount per week comprising the amount estimated by the
Australian Statistician as the average weekly total earnings of
all employees in New South Wales for:
(i) in respect of the whole or any part of a quarter
occurring between the date of the injury in relation to
which the award is made and the date of the award,
being a quarter for which such an amount has been
Page 7
Clause 15 Civil Liability Bill 2002
Part 2 Personal injury damages
Division 2 Fixing damages for economic loss
estimated by the Australian Statistician and is, at the
date of the award, available to the court making the
award--that quarter, or
(ii) in respect of the whole or any part of any other
quarter--the most recent quarter occurring before the
date of the award for which such an amount has been
estimated by the Australian Statistician and is, at that
date, available to the court making the award, or
(b) if the Australian Statistician fails or ceases to estimate the
amount referred to in paragraph (a), the prescribed amount or
the amount determined in such manner or by reference to such
matters, or both, as may be prescribed.
(5) If the services are provided or are to be provided for less than 40 hours
per week, the amount of those damages must not exceed the amount
calculated at an hourly rate of one-fortieth of the amount determined
in accordance with subsection (4) (a) or (b), as the case requires.
(6) Except as provided by this section, nothing in this section affects any
other law relating to the value of attendant care services.
Note. Section 18 provides that a court cannot order the payment of interest on
damages awarded for gratuitous attendant care services.
Division 3 Fixing damages for non-economic loss (general
damages)
16 Determination of damages for non-economic loss
(1) No damages may be awarded to a claimant for non-economic loss
unless the severity of the non-economic loss is at least 15% of a most
extreme case.
(2) The maximum amount of damages that may be awarded to a claimant
for non-economic loss is $350,000, but the maximum amount is to be
awarded only in a most extreme case.
(3) If the severity of the non-economic loss of the claimant is equal to or
greater than 15% of a most extreme case, the damages for
non-economic loss are to be determined in accordance with the
following Table:
Page 8
Civil Liability Bill 2002 Clause 16
Personal injury damages Part 2
Fixing damages for non-economic loss (general damages) Division 3
Table
Severity of the non-economic loss (as Damages for non-economic loss (as a
a proportion of a most extreme case) proportion of the maximum amount
that may be awarded for
non-economic loss)
15% 1%
16% 1.5%
17% 2%
18% 2.5%
19% 3%
20% 3.5%
21% 4%
22% 4.5%
23% 5%
24% 5.5%
25% 6.5%
26% 8%
27% 10%
28% 14%
29% 18%
30% 23%
31% 26%
32% 30%
33% 33%
34%100% 34%100% respectively
Page 9
Clause 16 Civil Liability Bill 2002
Part 2 Personal injury damages
Division 3 Fixing damages for non-economic loss (general damages)
(4) An amount determined in accordance with subsection (3) is to be
rounded to the nearest $500.
Note. The following are the steps required in the assessment of non-economic
loss in accordance with this section:
Step 1: Determine the severity of the claimant's non-economic loss as a proportion
of a most extreme case. The proportion should be expressed as a percentage.
Step 2: Confirm the maximum amount that may be awarded under this section for
non-economic loss in a most extreme case. This amount is indexed each year
under section 17.
Step 3: Use the Table to determine the percentage of the maximum amount
payable in respect of the claim. The amount payable under this section for
non-economic loss is then determined by multiplying the maximum amount that
may be awarded in a most extreme case by the percentage set out in the Table.
Where the proportion of a most extreme case is greater than 33%, the amount
payable will be the same proportion of the maximum amount.
17 Indexation of maximum amount relating to non-economic loss
(1) The Minister is, on or before 1 October 2002 and on or before 1
October in each succeeding year, to declare, by order published in the
Gazette, the amount that is to apply, as from the date specified in the
order, for the purposes of section 16 (2).
(2) The amount declared is to be the amount applicable under section
16 (2) (or that amount as last adjusted under this section) adjusted by
the percentage change in the amount estimated by the Australian
Statistician of the average weekly total earnings of full-time adults in
New South Wales over the 4 quarters preceding the date of the
declaration for which those estimates are, at that date, available.
(3) An amount declared for the time being under this section applies to the
exclusion of the amount under section 16 (2).
(4) If the Australian Statistician fails or ceases to estimate the amount
referred to in subsection (2), the amount declared is to be determined
in accordance with the regulations.
(5) In adjusting an amount to be declared for the purposes of section
16 (2), the amount determined in accordance with subsection (2) is to
be rounded to the nearest $500.
Page 10
Civil Liability Bill 2002 Clause 18
Personal injury damages Part 2
Other matters Division 4
Division 4 Other matters
18 Interest on damages
(1) A court cannot order the payment of interest on damages awarded for
non-economic loss or gratuitous attendant care services (as defined in
section 15).
(2) If a court is satisfied that interest is payable on damages (other than
damages for non-economic loss or gratuitous attendant care services),
the amount of interest is to be calculated:
(a) for the period from when the loss to which the damages relate
was first incurred until the date on which the court determines
the damages, and
(b) in accordance with the principles ordinarily applied by the court
for that purpose, subject to subsection (3).
(3) The rate of interest to be used in any such calculation is:
(a) such interest rate as may be determined by the regulations, or
(b) if no such rate is determined by the regulations--the relevant
interest rate as at the date of determination of the damages.
(4) For the purposes of subsection (3), the relevant interest rate is the rate
representing the Commonwealth Government 10-year benchmark
bond rate as published by the Reserve Bank of Australia in the Reserve
Bank of Australia Bulletin (however described) and as applying:
(a) on the first business day of January of each year (in which case
the rate is to apply as the relevant interest rate for the period
from 1 March until 31 August of that year), or
(b) on the first business day of July of each year (in which case the
rate is to apply as the relevant interest rate for the period from
1 September of that year until the last day of February of the
following year).
(5) Nothing in this section affects the payment of interest on a debt under
a judgment or order of a court.
19 Third party contributions
(1) This section applies when a person (the claimant) is entitled to an
award of damages in respect of death or injury against a person (the
defendant) and also against another person (the third party), and the
Page 11
Clause 19 Civil Liability Bill 2002
Part 2 Personal injury damages
Division 4 Other matters
award against the defendant is an award to which this Part applies but
the award against the third party is not an award to which this Part
applies.
(2) A court determining the amount of the contribution (the defendant's
contribution) to be recovered by the third party from the defendant
must:
(a) determine the defendant's contribution as a percentage, being
such percentage as the court thinks just and equitable (having
regard to the extent of the responsibility of the defendant and
the third party, respectively, for the claimant's damages), and
(b) determine the amount of damages to which the claimant is, or
would be, entitled in accordance with this Part (as if the award
of damages against the third party were not excluded from the
operation of this Part), and
(c) fix the amount of the defendant's contribution by applying the
percentage determined under paragraph (a) to the amount of
damages determined under paragraph (b).
(3) The amount of damages that may be recovered by the claimant from
the third party is to be reduced by the difference between:
(a) the amount of the contribution to which the third party would
have been entitled (but for this section) from the defendant, and
(b) the amount of the defendant's contribution calculated under
subsection (2).
(4) Subsection (3) does not limit any greater reduction (applicable under
any other law) in the amount of damages that may be recovered by the
claimant from the third party.
20 Contributory negligence--claims under the Compensation to Relatives
Act 1897
(1) In a claim for personal injury damages brought under the
Compensation to Relatives Act 1897, the court is entitled to have
regard to the contributory negligence of the deceased person.
(2) Section 13 of the Law Reform (Miscellaneous Provisions) Act 1965
does not apply so as to prevent the reduction of damages by the
contributory negligence of a deceased person in respect of a claim for
personal injury damages.
Page 12
Civil Liability Bill 2002 Clause 21
Personal injury damages Part 2
Other matters Division 4
21 Exemplary, punitive and aggravated damages
In an action for the award of personal injury damages where the fault
that caused the injury or death concerned is negligence, a court cannot
award exemplary or punitive damages or damages in the nature of
aggravated damages.
22 Court may make consent order for structured settlement
(1) This section applies where the parties to a claim for personal injury
damages agree to settle the claim by making a structured settlement
and apply to the court for an order approving of or in the terms of the
structured settlement.
(2) The court may make the order even though the payment of damages
is not in the form of a lump sum award of damages.
(3) For the purposes of this section, a structured settlement is an
agreement that provides for the payment of all or part of an award of
damages in the form of periodic payments funded by an annuity or
other agreed means.
Page 13
Civil Liability Bill 2002
Schedule 1 Savings and transitional provisions
Schedule 1 Savings and transitional provisions
(Section 7)
Part 1 Preliminary
1 Regulations
(1) The regulations may contain provisions of a savings or transitional
nature consequent on the enactment of the following Acts:
this Act
(2) Any such provision may, if the regulations so provide, take effect
from:
(a) 20 March 2002 or a later date where this Act is the Act
concerned, or
(b) where some other Act is the Act concerned, the date of assent
to that Act or a later date.
Part 2 Provisions consequent on enactment of this Act
2 Application of Act to existing injuries and pending claims
(1) Part 2 of this Act extends to an award of personal injury damages that
relates to an injury received, or to a death resulting from an injury
received, whether before or after the commencement of this Act.
(2) However, Part 2 of this Act does not apply to or in respect of:
(a) an award of damages in proceedings commenced in a court
before the commencement of this Act, or
(b) an award of damages, or settlement or consent order in respect
of damages, made before the date of assent to this Act.
3 Application of Act to health care claims
Despite the amendments made by this Act to the Health Care Liability
Act 2001, that Act continues to apply (as if it had not been amended by
this Act) to an award in respect of a health care claim (as defined in
that Act) in proceedings commenced in a court before the
commencement of this Act.
Page 14
Civil Liability Bill 2002
Savings and transitional provisions Schedule 1
4 Application of Act to claims against the Crown notified before 20 March
2002
(1) Part 2 of this Act does not apply to or in respect of an award of
damages on a claim against the Crown if the Crown has been notified
in writing of the claim before 20 March 2002 and:
(a) the damages are awarded (or are the subject of a settlement or
consent order made) before 1 September 2002, or
(b) proceedings on the claim are commenced in a court before 1
September 2002, or
(c) proceedings on the claim cannot be commenced before 1
September 2002 because the injury concerned has not
stabilised.
(2) This clause does not apply to an award in respect of a health care claim
as defined in the Health Care Liability Act 2001.
(3) In this clause:
Crown means the Crown within the meaning of the Crown
Proceedings Act 1988 and includes a State owned corporation within
the meaning of the State Owned Corporations Act 1989.
Page 15
Civil Liability Bill 2002
Schedule 2 Amendment of Acts
Schedule 2 Amendment of Acts
(Section 8)
2.1 Health Care Liability Act 2001 No 42
[1] Part 2 Awarding of damages in health care claims
Omit the Part.
[2] Section 28 Determination of contribution to third party
Omit the section.
2.2 Legal Profession Act 1987 No 109
[1] Section 196 Regulations to provide for related costs
Insert as section 196 (1) (a2):
(a2) fixing the costs payable for legal services provided in
connection with any claim for personal injury damages
(within the meaning of the Civil Liability Act 2002),
[2] Part 11 Legal fees and other costs
Insert after Division 5A:
Division 5B Maximum costs in personal injury damages
matters
198C Interpretation and application
(1) In this Division:
defendant means a person against whom a claim for personal
injury damages is or may be made.
party means plaintiff or defendant.
Page 16
Civil Liability Bill 2002
Amendment of Acts Schedule 2
personal injury damages has the same meaning as in the Civil
Liability Act 2002.
plaintiff means a person who makes or is entitled to make a
claim for personal injury damages.
(2) This Division does not apply to the following costs:
(a) costs payable to an applicant for compensation under
Part 2 of the Victims Support and Rehabilitation
Act 1996 in respect of the application for compensation,
(b) costs for legal services provided in respect of a claim
under the Motor Accidents Act 1988 or Motor
Accidents Compensation Act 1999,
(c) costs for legal services provided in respect of a claim for
work injury damages (as defined in the Workplace
Injury Management and Workers Compensation Act
1998),
(d) costs for legal services provided in respect of a claim for
damages in proceedings of the kind referred to in
section 11 (Claims for damages for dust diseases etc to
be brought under this Act) of the Dust Diseases
Tribunal Act 1989.
198D Maximum costs fixed for claims up to $100,000
(1) If the amount recovered on a claim for personal injury damages
does not exceed $100,000, the maximum costs for legal
services provided to a party in connection with the claim are
fixed as follows:
(a) in the case of legal services provided to a plaintiff
maximum costs are fixed at 20% of the amount
recovered or $10,000, whichever is greater,
(b) in the case of legal services provided to a defendant
maximum costs are fixed at 20% of the amount sought
to be recovered by the plaintiff or $10,000, whichever
is greater.
(2) The regulations may prescribe an amount to replace the amount
of $100,000 or $10,000 in subsection (1) and may prescribe a
percentage to replace the percentage of 20% in subsection (1).
Page 17
Civil Liability Bill 2002
Schedule 2 Amendment of Acts
When such a replacement amount or percentage is prescribed,
it applies for the purposes of subsection (1) in place of the
amount or percentage that it replaces.
(3) The regulations may contain provisions of a savings or
transitional nature consequent on the making of regulations
under this section.
(4) When the maximum costs for legal services provided to a party
are fixed by this Division the following provisions apply
(subject to sections 198E198G):
(a) a solicitor or barrister is not entitled to be paid or
recover for those legal services an amount that exceeds
those maximum costs,
(b) a court or tribunal cannot order the payment by another
party to the claim of costs in respect of those legal
services in an amount that exceeds that maximum,
(c) in assessing the amount of those costs that is a fair and
reasonable amount, a costs assessor cannot determine an
amount that exceeds the maximum set by this section.
(5) A reference in this Division to legal services provided to a party
is a reference to legal services provided to the party by a
solicitor or barrister (including by an agent or employee of the
solicitor or barrister). Costs for legal services do not include
costs charged as disbursements for services provided by any
other person or other disbursements.
(6) If proceedings are commenced on a claim, the amount sought
to be recovered by the plaintiff is taken to be the amount sought
to be proved by the plaintiff at the hearing of the claim.
(7) Maximum costs fixed by this section apply despite regulations
under section 196 (1) (a2) fixing those costs.
198E Maximum costs do not affect solicitor-client costs under costs
agreements
(1) This Division does not apply to the recovery of costs payable
as between a solicitor or barrister and the solicitor's or
barrister's client to the extent that recovery of those costs is
provided for by a costs agreement that complies with
Division 3.
Page 18
Civil Liability Bill 2002
Amendment of Acts Schedule 2
(2) The regulations may make provision for or with respect to
requiring disclosure by a solicitor or barrister to the solicitor's
or barrister's client of information in relation to the effect of a
costs agreement in connection with the operation of this
Division.
(3) The regulations may provide that a failure by a solicitor or
barrister to comply with the requirements of the regulations
under this section disentitles the solicitor or barrister to the
benefit of this section, and in such a case this Division applies
in respect of the claim concerned despite the terms of any costs
agreement.
198F Costs can be awarded on indemnity basis for costs incurred after
failure to accept offer of compromise
(1) If a party to a claim for personal injury damages makes a
reasonable offer of compromise on the claim that is not
accepted, this Division does not prevent the awarding of costs
against another party to be assessed on an indemnity basis in
respect of legal services provided after the offer is made.
(2) An offer of compromise on a claim by a party is reasonable if
the court determines or makes an order or award on the claim
in terms that are no less favourable to the party than the terms
of the offer.
(3) The regulations may make provision for or with respect to
requiring disclosure by a solicitor or barrister to the solicitor's
or barrister's client of information in relation to the operation
of this section in respect of any refusal by the client to accept
an offer of compromise.
(4) If it appears to the court in which proceedings are taken on a
claim for damages that a solicitor or barrister has failed to
comply with any provision of the regulations under this section,
and that the client of the solicitor or barrister has incurred an
increased liability for costs as a result of refusing a reasonable
offer of compromise in connection with the claim concerned,
the court may of its own motion or on the application of the
client make either or both of the following orders:
(a) an order directing the solicitor or barrister to repay to the
client the whole or any part of those increased costs that
the client has been ordered to pay to any other party,
Page 19
Civil Liability Bill 2002
Schedule 2 Amendment of Acts
(b) an order directing the solicitor or barrister to indemnify
any party other than the client against the whole or any
part of the costs payable by the party indemnified in
respect of legal services provided after the offer is
refused.
198G Court may order certain legal services to be excluded from
maximum costs limitation
A court hearing a claim for personal injury damages may by
order exclude from the operation of this Division legal services
provided to a party to the claim if the court is satisfied that the
legal services were provided in response to any action on the
claim by or on behalf of the other party to the claim that in the
circumstances was not reasonably necessary for the
advancement of that party's case or was intended or reasonably
likely to unnecessarily delay or complicate determination of the
claim.
198H Apportionment of maximum costs between solicitors and
barristers
(1) If more than one person (solicitor or barrister) provides legal
services to a party in connection with a claim, the maximum
costs fixed by this Division are to be apportioned between them
as agreed by them or (failing agreement) as ordered by the court
hearing proceedings on the claim.
(2) The maximum then applicable to a particular solicitor or
barrister is the solicitor's or barrister's apportioned share of
those maximum costs.
198I Meaning of "amount recovered" on a claim
(1) A reference in this Division to the amount recovered on a claim
includes any amount paid under a compromise or settlement of
the claim (whether or not legal proceedings have been
instituted).
(2) In determining the amount recovered on a claim for personal
injury damages, no regard is to be had to any part of the
amount recovered that is attributable to costs or to the addition
of interest.
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Civil Liability Bill 2002
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Division 5C Costs in civil claims where no reasonable
prospects of success
198J Solicitor or barrister not to act unless there are reasonable
prospects of success
(1) A solicitor or barrister must not provide legal services on a
claim or defence of a claim for damages unless the solicitor or
barrister reasonably believes on the basis of provable facts and
a reasonably arguable view of the law that the claim or the
defence (as appropriate) has reasonable prospects of success.
(2) A fact is provable only if the solicitor or barrister reasonably
believes that the material then available to him or her provides
a proper basis for alleging that fact.
(3) This Division applies despite any obligation that a solicitor or
barrister may have to act in accordance with the instructions or
wishes of his or her client.
(4) A claim has reasonable prospects of success if there are
reasonable prospects of damages being recovered on the claim.
A defence has reasonable prospects of success if there are
reasonable prospects of the defence defeating the claim or
leading to a reduction in the damages recovered on the claim.
(5) Provision of legal services in contravention of this section
constitutes for the purposes of this Division the provision of
legal services without reasonable prospects of success.
198K Preliminary legal work not affected
This Division does not apply to legal services provided as a
preliminary matter for the purpose of a proper and reasonable
consideration of whether a claim or defence has reasonable
prospects of success.
198L Restrictions on commencing proceedings without reasonable
prospects of success
(1) The provision of legal services without reasonable prospects of
success does not constitute an offence but is capable of being
professional misconduct or unsatisfactory professional conduct.
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Civil Liability Bill 2002
Schedule 2 Amendment of Acts
(2) A solicitor or barrister cannot file originating process or a
defence on a claim for damages unless the solicitor or barrister
certifies that there are reasonable grounds for believing on the
basis of provable facts and a reasonably arguable view of the
law that the claim or the defence (as appropriate) has
reasonable prospects of success.
(3) Originating process or a defence on a claim for damages is not
to be accepted for lodgment unless accompanied by the
certification required by this section. Rules of court may make
provision for or with respect to the form of that certification.
198M Costs order against solicitor or barrister who acts without
reasonable prospects of success
(1) If it appears to a court in which proceedings are taken on a
claim for damages that a solicitor or barrister has provided
legal services to a party without reasonable prospects of
success, the court may of its own motion or on the application
of any party to the proceedings make either or both of the
following orders in respect of the solicitor or barrister who
provided the services:
(a) an order directing the solicitor or barrister to repay to the
party to whom the services were provided the whole or
any part of the costs that the party has been ordered to
pay to any other party,
(b) an order directing the solicitor or barrister to indemnify
any party other than the party to whom the services were
provided against the whole or any part of the costs
payable by the party indemnified.
(2) The Supreme Court may on the application of any party to
proceedings on a claim for damages make any order that the
court in which proceedings on the claim are taken could make
under this section.
(3) An application for an order under this section cannot be made
after a final determination has been made under this Part by a
costs assessor of the costs payable as a result of an order made
by the court in which the proceedings on the claim concerned
were taken.
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Civil Liability Bill 2002
Amendment of Acts Schedule 2
(4) A solicitor or barrister is not entitled to demand, recover or
accept from his or her client any part of the amount for which
the solicitor or barrister is directed to indemnify a party
pursuant to an order under this section.
198N Onus on solicitor or barrister to show facts provided reasonable
prospects of success
(1) If the court (the trial court) hearing proceedings on a claim for
damages finds that the facts established by the evidence before
the court do not form a basis for a reasonable belief that the
claim or the defence had reasonable prospects of success, there
is a presumption for the purposes of this Division that legal
services provided on the claim or the defence (as appropriate)
were provided without reasonable prospects of success.
(2) If the Supreme Court (when the Supreme Court is not the trial
court) is satisfied, either as a result of a finding of the trial court
or otherwise on the basis of the judgment of the trial court, that
the facts established by the evidence before the trial court do
not form a basis for a reasonable belief that the claim or the
defence had reasonable prospects of success, there is a
presumption for the purposes of this Division that legal services
provided on the claim or the defence (as appropriate) were
provided without reasonable prospects of success.
(3) A presumption arising under this section is rebuttable and a
solicitor or barrister who seeks to rebut it bears the onus of
establishing that at the time legal services were provided there
were provable facts (as provided by section 198J) that provided
a basis for a reasonable belief that the claim or the defence on
which they were provided had reasonable prospects of success.
(4) A solicitor or barrister may, for the purpose of establishing that
at the time legal services were provided there were provable
facts (as provided by section 198J) that provided a basis for a
reasonable belief that the claim or the defence on which they
were provided had reasonable prospects of success, produce
information or a document despite any duty of confidentiality
in respect of a communication between the solicitor or barrister
and a client, but only if:
(a) the client is the client to whom the legal services were
provided or consents to its disclosure, or
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Civil Liability Bill 2002
Schedule 2 Amendment of Acts
(b) the court is satisfied that it is necessary for the solicitor
or barrister to do so in order to rebut a presumption
arising under this section.
[3] Section 208O Costs fixed by regulations
Insert "(a2)," before "(b)" in section 208O (1).
[4] Schedule 8 Savings, transitional and other provisions
Insert at the end of clause 1A (1):
Civil Liability Act 2002 (to the extent that it amends this Act)
[5] Schedule 8
Insert after clause 1A (2):
(2A) A provision referred to in subclause (1) may, where the Act
concerned is the Civil Liability Act 2002 and if the regulations
so provide, take effect from 20 March 2002 or a later date.
Subclause (3) does not apply to such a provision.
[6] Schedule 8
Insert at the end of the Schedule with appropriate Part and clause
numbering:
Part Provisions consequent on enactment of Civil
Liability Act 2002
Application of costs amendments
(1) Division 5B (Maximum costs in personal injury damages
matters) of Part 11 does not apply in respect of legal services
provided before 7 May 2002 but extends to legal services
provided on or after that date even if the legal services are
provided in connection with a claim that arose before that date
(and whether or not proceedings on the claim were commenced
before that date).
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Civil Liability Bill 2002
Amendment of Acts Schedule 2
(2) Division 5C (Costs in civil claims where no reasonable
prospects of success) of Part 11 extends to legal services
provided on or after 20 March 2002 even if the legal services
are provided in connection with a claim that arose before that
date (and whether or not proceedings on the claim were
commenced before that date).
(3) However, section 198L (2) and (3) do not apply in respect of
proceedings commenced before the date of assent to the Civil
Liability Act 2002.
(4) An order may not be made under section 198M (and an
application for such an order may not be made) before the date
of assent to the Civil Liability Act 2002.
Apportionment of costs for legal services
(1) In the application of Division 5B of Part 11 to a claim for
personal injury damages that straddles 7 May 2002, the
following provisions have effect in respect of the costs for legal
services provided to a party in connection with the claim:
(a) the costs for legal services provided on or after 7 May
2002 are to be determined as a proportion of the total
costs for legal services provided to the party (that is, for
legal services provided before, on or after 7 May 2002),
(b) the proportion determined under paragraph (a) is to be
applied to the maximum costs for legal services that
would (apart from this clause) be applicable in respect
of the claim under section 198D, so as to arrive at a
reduced maximum amount for costs in respect of legal
services provided on or after 7 May 2002,
(c) that reduced maximum amount becomes, for the
purposes of section 198D, the maximum costs for legal
services provided to the party in connection with the
claim on or after 7 May 2002.
Note. Section 198D does not apply to costs for legal services provided
before 7 May 2002.
(2) After the date of assent to the Civil Liability Act 2002, a
solicitor or barrister must not provide a legal service to a party
in connection with a claim for personal injury damages that
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Civil Liability Bill 2002
Schedule 2 Amendment of Acts
straddles 7 May 2002 unless the party has been notified in
writing by the solicitor or barrister of the effect of Divisions 5B
and 5C of Part 11.
(3) A claim straddles 7 May 2002 if legal services are provided in
connection with the claim both before and on or after 7 May
2002.
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