[Norton Rose Fulbright | Global Legal Practice]
About usPeopleOur services
Learning and development
Antitrust and competition
Asset and wealth management
Banking and finance
Communications, media and entertainment
Corporate, M&A and securities
Dispute resolution and litigation
Employment and labour
Financial services and markets
Infrastructure, mining and commodities
Life sciences and healthcare
Oil and gas
Pensions and incentives
Pharmaceuticals and life sciences
Regulation and investigations
Restructuring and insolvency
Sourcing and technology
Sustainability and climate change
Technology and innovation
Insurance Update - June 2014
28 May 2014
Welcome to the June quarterly edition of the Norton Rose Fulbright Insurance Update. Reform continues to be front of mind for the Australian Government. The release of the draft report by the Productivity Commission addressing Access to Justice arrangements is just one area of reform we focus on in this edition. Class action litigation continues to be a focus with the Supreme Court of Victoria delivering its judgment in the Abalone Case and we consider the decision of Beach AJ in the Dr Peters’ litigation addressing the power of the court to require opt outs to participate in a group proceeding. We are also pleased to be able to include an article from our USA colleagues addressing fraud on the market presumption of reliance the outcome of which has potential to impact the approach of Australian Courts to securities class actions and litigation. We also look at recent case law developments on proportionate liability, s 28(3) of the Insurance Contracts Act and the preparedness of courts to protect confidential information.
Finally I am also pleased to announce two new partners in the Insurance group in our Sydney office. Ray Giblett, has joined Norton Rose Fulbright Australia in the last quarter and Toby Biddle, has recently been promoted to Partner. Both partners continue to add quality and strength to our already market leading practice.
I hope you enjoy this edition of the Insurance Update.
Contingency fee arrangements and tighter controls for litigation funders: proposed reforms
Authors: Tricia Hobson, Ben Allen, John Moran
On 8 April 2014, the Australian Government’s Productivity Commission released its draft report concerning Access to Justice Arrangements in Australia (the Report). The Report is the product of an initial phase of public consultation conducted by the Commission over the past eight months on a wide range of issues relating to access to justice.
In the Report, the Commission has made recommendations on ways to improve access to the civil justice system and equity of representation, as well as seeking further input from interested parties on these issues. A copy of the full Report can be viewed here.
In this article we focus on the Commission’s specific recommendations in relation to:
reform to billing arrangements in civil matters with the introduction of damage-based billing in Australia; and
increased regulation for third party litigation funders.
The introduction of damages-based billing
Currently in Australia, lawyers are permitted to enter into ‘conditional’ billing arrangements with their clients whereby the fees payable depend on whether the legal action is successful, with the potential for a further ‘uplift’ on legal fees, subject to various jurisdictional limits and disclosure requirements. This form of alternative billing agreement has been recognised by the Commission as enabling clients to “pursue actions that they would not otherwise have the financial capability to do, thus increasing access to the civil justice system”.
While this form of ‘contingency’ fee arrangement has become a common feature of the Australian legal landscape, ‘damage-based’ billing has been and remains prohibited in Australia.
As the name suggests, damages-based billing is where the lawyer receives a pre-determined percentage of the award of damages and is not paid if the legal action is unsuccessful. This billing arrangement is commonplace in jurisdictions such as the US, Canada and more recently the UK. It has been heralded by some as having resulted in an increase in access to justice without “an explosion of frivolous claims”.
In the Report, the Commission has made recommendations that the restrictions on damages-based billing be removed for most civil matters subject to comprehensive disclosure requirements. This recommendation has been met with mixed review.
Opponents to its introduction have suggested that it could create adverse incentives for lawyers and will likely lead to an increase in weak or unmeritorious litigation. It has also been suggested that such arrangements give rise to a greater risk of conflict of interest than the routine arrangement since, for example in personal injury matters, legal fees are met by damages that are intended to cover the costs of future care.
Supporters of its introduction contend that damages-based billing aligns the incentives of the lawyers with the client because the lawyer’s fee is result-based and the fees do not increase with the hours worked. Further, Australia’s cost-shifting rule whereby the loser pays, should continue to counter the threat of an increase in frivolous litigation. It has also been put forward that unlike the routine conditional fee agreement, damage-based fees offer the benefit of being a proportional payment for the client avoiding the scenario where the outcome is successful but with only a nominal amount recovered, the client is left with loose change after paying legal expenses.
In terms of further public consultation, the Commission has asked for input on the appropriateness of the current cap of 25% on conditional billing arrangements and whether a percentage cap on a sliding scale should be considered in the context of introducing damage-based billing.
Implications of permitting contingency fee arrangements
In practical terms, increasing demand from commercial clients for non-traditional fee arrangements will likely see the proposal to remove the restriction on contingency fee arrangements welcomed by both firms and clients alike.
However, there is a danger that contingency fees could be misused by some in the market. The Productivity Commission should be mindful of the fact that lifting the restriction on contingency fees will lead to a marked increase in the volume of particular types of ‘big ticket’ proceedings from commercially astute plaintiff law firms geared for class action litigation, with little actual benefit to those requiring access to justice.
The mooted cap on contingency fee arrangements is also unlikely to assist in overcoming the inherent conflict that lawyers could be placed in regarding their duties to the court and their clients, on the one hand, and their own interests, on the other.
Third party litigation funding reforms
While recognising that litigation funders often provide an important avenue to accessing justice for litigants who lack financial resources but have meritorious claims, the Commission has recommended increased regulation of third party litigation funders. Specifically, the Commission has recommended that litigation funders should:
hold a financial services licence;
be subject to capital adequacy requirements;
meet appropriate ethical and professional standards; and
be monitored by the Australian Securities and Investment Commission – never referred to again.
Without traversing the history of litigation funding in Australia, the current position following the introduction of the Corporations Amendment Regulation 2012 (no 6), is that persons providing funding as part of either single or multi-party litigation are exempted from the requirement to hold an Australian Financial Services Llicence -never referred to again provided they have appropriate processes in place for managing conflicts of interest.
The proposed increase in regulation is seen as a response to the unique risks that are said to arise from the litigant/funder relationship including the imbalance of bargaining power, the potential of conflict of interest between funders, lawyers and plaintiffs and the potential that funders exercise too much control over proceedings.
Impact of the proposed reforms to third party litigation funding
The proposed tightening of regulations for litigation funders should be welcomed, particularly as new entrants come into the market and where the entities standing behind funders are changing. A stricter licensing regime and prudential requirements for people holding themselves out as litigation funders will not only protect consumers from any commercially sharp practices but will go a long way to ensuring that regulators have oversight of the activities of funders, without impacting access to justice.
What to watch?
The Commission has invited submissions on the draft report and the recommendations before 21 May 2014.
Revisiting the imposition of a duty of care on public authorities: Regent Holdings
Author: Karina Prajoga
On 7 November 2013, Beach J delivered his judgment in the Supreme Court of Victoria class action Regent Holdings Pty Ltd v State of Victoria  VSC 601 commenced by the plaintiff on behalf of wild abalone licensee holders.
The action claimed the loss of income of the licensee holders from reduced stocks of wild abalone for commercial harvesting following the outbreak of an abalone virus. In this matter, the plaintiff alleged the State of Victoria (the State)1 (through the actions of various tortfeasors) was negligent in failing to exercise statutory powers which may have prevented the spread of the virus from an abalone aquaculture farm through the coast of Victoria.2 It was alleged the escape caused economic loss for individuals and/or companies involved in and/or connected with the commercial abalone industry, including the plaintiff.
Justice Beach dismissed the plaintiff’s claim against the State on the basis that the plaintiff failed to establish the State owed a duty to take reasonable care to protect it from economic loss caused by an escape of the virus from the SOM farm. The plaintiff also failed on the issues of breach and causation.
Duty of care
The duty of care alleged to have been owed was a duty to take reasonable care to protect it from suffering pure economic loss caused by an escape of the virus from the SOM farm.
In support of the duty being owed, the plaintiff relied on the High Court’s decision in Pyrenees Shire Council v Day3 (Pyrenees). In particular, the plaintiff relied on Justice McHugh’s characterisation of Pyrenees in the High Court’s decision in Graham Barclay Oysters v Ryan4. The plaintiff contended the State owed the plaintiff a duty of care because it knew of the risk of harm to specific individuals, had the power under relevant legislation to take steps to eliminate that risk and importantly, at an earlier stage, had given directions to eliminate the risk.
The plaintiff further argued the State exercised a sufficient degree of control over the risk of harm that has eventuated to justify the imposition of a duty of care. The plaintiff also submitted that it was vulnerable, in that it could do nothing to prevent or stop the virus from escaping the SOM farm and spreading along the Victorian coast.
The plaintiff alleged each of the State tortfeasors had powers under the Livestock Diseases Control Act 1994or the Fisheries Act 1995 (the Act), and that the proper exercise of one or more of these powers would, as a probability, have prevented the virus from escaping into the wild. In particular, the plaintiff alleged:
Dr Millar (the ‘livestock’ inspector under the Act) had powers to make orders to isolate dispose or destroy affected livestock or livestock product; quarantine or keep secure any place affected and to prohibit or restrict movement of any livestock.
the Secretary had powers to declare a place as an infected place if the Secretary reasonably suspects that a place is infected with an exotic disease.
the Minister had powers to declare a place as a restricted area and specify prohibitions, restrictions and requirements to operate in the restricted area. It was further alleged that the Minister had power to make a fisheries notice under section 152 of the Fisheries Act to order a person to cull, dispose or decontaminate affected livestock or cease effluent discharge from the farm.
In defence, the State contended that no such duty of care existed, as the powers relied upon were quasi-legislative in nature (in that each of the powers creates an offence) and therefore cannot be compelled or constrained by a common law duty of care.
The State placed significant reliance on the High Court authority of Sullivan v Moody5 in denying the existence of a duty of care on the basis that it would result in the imposition of conflicting duties upon the State (ie between those owed in the public interest to the commercial licensee plaintiff’s and SOM, the owner of the farm) and an indeterminacy of liability (ie it was not foreseeable the extent to which the escape might affect the stocks of wild abalone).
Ultimately, Beach J found that a duty of care does not exist for the following reasons:
imposing a duty would result in conflicting duties owed by the State to the owners and operators of abalone farms on the one hand, and duties owed to those (licensees) involved in the catching, storing and processing of wild abalone on the other hand;
the potential indeterminacy of the class of people the State owes the alleged duty to;
the State did not have sufficient degree of control which justifies the imposition of a duty of care as alleged by the plaintiff. Rather, control was exercised by the farmers who could have taken steps to eradicate or stop the spread of the virus;
the plaintiff’s claim of vulnerability, in that it was not able to take steps to prevent the virus from spreading into the wild, was not a sufficient foundation upon which to base a duty on when looked at in light of other relevant considerations;
the potential liability of the State is disproportionate to any fault that might be attributed to it, in preferring the interests of one group over another, when deciding whether or not to exercise one of the relevant statutory powers6;
the State’s powers in question are quasi-legislative nature (in that they each create offences), therefore the exercise of these powers cannot be constrained by a common law duty of care.
In relation to the reasoning in Pyrenees, his Honour found that the concepts of general reliance and proximity are no longer determinative factors when considering the existence of a duty of care.7
His Honour distinguished this case from Pyrenees on facts, as this was only a claim involving pure economic loss. Secondly, in Pyrenees, there were no conflicting duties or indeterminacy in respect of the class of people to whom a duty of care might be owed. Additionally in Pyrenees there was no disproportionality between the liabilities contended for and the fault of the Council.
This decision may have implications for insurers involved in class actions where novel duties of care are alleged. The decision will be particularly relevant for insurers of the State, public authorities and/or other parties exercising statutory functions, as it may be indicative of an move away the concepts of general reliance and proximity in determining whether a duty of care sourced from statutory duties, exists.8
This judgment provides guidance on the circumstances where a duty may or may not be imposed and the factors that are relevant to the assessment of whether such duty exists or have been breached. Importantly, Justice Beach’s judgment indicates the existence of a duty of care may be unlikely to be imposed if:
It would impose conflicting duties upon a public authority (ie between the public interest and commercial stakeholders);
The class of persons who are owed the duty would be indeterminable (ie leads to potential indeterminacy of liability).
Further lessons for the duty of care owed by statutory authorities include:
The State must exercise a sufficient degree of control (vis-à-vis other parties’ ability to take steps to prevent or mitigate the risk) to justify the imposition of a duty of care;
The vulnerability of the plaintiff is not determinative, nor will it provide a sufficient foundation upon which to base a duty on – it must be considered in light of other relevant considerations;
Pyrenees now stands for the general proposition that “when statutory powers are conferred, they must be exercised with reasonable care – so that if the relevant function is performed negligently, a cause of action may arise”.
Not so Basic anymore – USA Supreme Court to assess Basic’s fraud-on-the-market presumption of reliance
[Gerard G. Pecht]
Gerard G. Pecht
Author: Nicole Wearne
Securities class actions are now big business in the Australian legal environment involving regulators, litigation funders, underwriters and of course law firms. Plaintiff firms and litigation funders continue to look for opportunities in the class actions space arising from inadequate disclosure obligations and misleading and deceptive conduct claims and principally rely on the legal concept of “fraud on the market” reliance in negotiations seeking large sums of compensation for their clients. To date, the courts in Australia have not had to rule on whether “fraud on the market” is part of the legal framework as all relevant class actions have been settled and in Timbercorp the court found that the PDS was not misleading or deceptive, so the issue didn’t need to be considered. Defendants will continue to maintain that individual reliance is the relevant test for establishing the relevant cause of action. In the USA fraud on the market has been part of its legal framework for decades. However the USA is presently revisiting whether fraud on the market should continue to be the law of that country. We thought our clients would be interested to learn about potential developments in the USA in respect of this important principle which could well have implications for the future development of Australian legal principle. The article below has been prepared by our partner Gerry Pecht, based in our Houston office and his colleagues in the USA.
The Basic presumption
Authors: Gerard G. Pecht, John J. Byron, Mark Thomas Oakes, Tara Tune, Peter A. Stokes
On November 15, 2013, the Supreme Court granted certiorari in a case, Halliburton Co. v. Erica P. John Fund, Inc., No. 13-317, that should be on the radar of every securities lawyer. The reason is that the Court will consider the continuing validity of the class-wide reliance presumption set forth in Basic, Inc. v. Levinson, 485 U.S. 224 (1988). If Basic is overruled or significantly modified, the case will have a significant impact on putative federal securities class actions.
The Court’s 1988 ruling in Basic was a watershed for class certification in securities cases. This is because the Court eliminated the need for plaintiffs to show individual reliance on alleged misrepresentations in cases brought under Section 10(b) of the Securities Exchange Act of 1934 and SEC Rule 10b-5. Instead, reliance on alleged misrepresentations can be presumed. This presumption is based on the theory that efficient markets incorporate all publicly available information, including alleged misrepresentations, about the company into the share price. Accordingly, when investors buy or sell shares at market price, they do so in presumptive reliance on the alleged misrepresentations.
In recent years, many, including members of the Court, have questioned the Basic presumption. In Amgen, Inc. v. Connecticut Retirement Plans and Trust Funds, 133 S. Ct. 1184 (2013), four Justices either authored or joined in opinions that were critical of Basic’s theory. Justice Thomas wrote a dissent that Justices Scalia and Kennedy joined. In that dissent, Thomas said the “Basic decision itself is questionable.” Justice Alito, who wrote a concurring opinion, was even more overt, stating that “recent evidence suggests that the presumption may rest on a faulty economic premise” and “reconsideration of the Basic presumption may be appropriate.”
The Court’s grant of certiorari
In Halliburton, the Court will get the opportunity to reconsider the Basic presumption. The case comes to the Supreme Court by way of the Fifth Circuit. The Fifth Circuit affirmed the district court’s grant of class certification based on the Basic theory and prohibited Halliburton from presenting market price impact evidence to rebut the presumption of reliance.
The petition for certiorari asked the Court to consider two questions: (1) whether the Court should “overrule or substantively modify” the Basic presumption and (2) whether a defendant may rebut the presumption by introducing evidence that the alleged misrepresentations did not distort the market price. In its order granting certiorari, the Court did not limit its review to either question. The Court will likely consider both questions.
The Halliburton case has the potential to have far reaching consequences for securities lawsuits. If the Court overturns the fraud-on-the-market presumption, class certification would be exceedingly difficult for securities plaintiffs. As a result, individual plaintiffs without large, provable damages would likely have to resort to other theories of liability.9 Such a decision would also result in case management issues for defendants. For example, defendants would have to worry about seriatim lawsuits (instead of just opt-out lawsuits) until the end of the limitations period.
If, on the other hand, the Court does not overturn the fraud-on-the-market presumption but allows defendants to rebut it, class certification litigation will become more complex; defendants will have a new tool to defeat securities classes and plaintiffs will have a new hurdle to moving forward. Regardless, the Court’s decision should make next year a very interesting one for the securities bar.
Supreme Court class actions: ‘opt-out proceedings’ and their potential to hinder a global settlement
Authors: Renee Gorenstein, Nicole Wearne, Edward O'Brien
In this case, the proposed settlement of a class action was jeopardised by a lone person who had opted out of the group and had commenced her own separate proceeding10. Appeal Justice Beach in A v Schulberg & Ors  VSC 18011 recently ruled on an application to require the opt out member rejoin the class.
This interesting judgment arises in the context of the high profile class action involving various patients of anaesthetist Dr James Peters who was found guilty of infecting the patients with the hepatitis C virus during their medical procedures. Dr Peters had the hepatitis C virus. During his criminal hearing a court found that Dr Peters self-administered the anaesthetic drug fentanyl (to which he was addicted) before using the same needle to anaesthetise his patients thereby passing on the virus.
Slater & Gordon commenced a class action common law claim on behalf of some 60 odd patients of Dr Peters who had been infected with the hepatitis C virus (the group proceeding). The representative plaintiff in the group proceeding was known as ‘A’. The defendants to the group proceeding were the principal of the surgery Dr Schulberg, the day hospital Croydon Day Surgery and the Australian Health Practitioners Regulation Authority. Section 33J of the Act permits a person who would otherwise fall within a group, to opt out of a group proceeding. One of Dr Peters’ patients, “M”, successfully applied to the Court to opt out of the group. She had in fact commenced her own separate proceeding against the same defendants (theindividual proceeding) but not served the writ until the group proceeding was well advanced.
The opt out
The Court ordered date for group members to opt out of the group proceeding was 30 May 2013. Despite commencing her own proceeding, M did not opt out of the group before this date.
On 26 August 2013, following an application by the defendants to have the individual proceeding permanently stayed or dismissed as an abuse of process, His Honour Justice Beach (as he then was) exercised the court’s under section 33KA of the Act to order that M cease to be a group member. The upshot of this ruling was that M became an ‘opt out’ but, given the overlap in subject matter, the court ordered that the individual proceeding was to be heard and determined at the same time as the group proceeding.
Difficulties with settlement
The defendants made a settlement offer in the proceedings of a fixed lump sum payment, which was to be distributed among the group members and to M to be determined by Slater & Gordon (the proposed settlement).
The offer was conditional on both proceedings being resolved. The issues in dispute were identical in both claims and the costs of defending the individual opt out claim were not substantially different from the costs of defending the group proceeding. The group representative A had been ordered by the trial judge to share with M’s lawyers all expert evidence, chronologies, the court book index and other materials ahead of trial. In effect the procedural orders armed M with the work product of Slater & Gordon for no fee. The solicitors for M had not prepared any liability case against the defendants which was subsequently frankly admitted by M’s Counsel in open court.
The settlement offer was acceptable to the group. However, as M refused to agree to the proposed settlement, neither proceeding was able to be resolved at that time.
Can an ‘opt out’ be ordered back in to the group?
The group plaintiff listed the matter for directions before the Court and informed the judge that the position taken by M was hindering settlement of the group proceeding.
Beach JA considered whether he had the power to revoke his earlier order under section 33KA of the Act, so as to effectively compel M to re-join the group. Beach JA’s canvassed the prospect that, after re-joining the group, M could object to the settlement at the approval hearing if she so desired but she would not be able to prevent the settlement from occurring.
Beach JA ultimately ruled that he did not have power to revoke the ‘opt out’ order. At paragraph  His Honour noted that:
“there is nothing in Part 4A that suggests it was ever the intention of the Parliament that individuals who did not want to participate in a group proceeding might be compelled to join in, and be bound by the result of, such a proceeding. Indeed, while s 33KA of the Act permits the Court to make an order that a person cease to be a group member, there is no provision in Part 4A that, in terms, permits the Court to order a person to be a group member”.
At paragraph  his Honour went on to say that:
“[w]hile one might wish it were otherwise, the mere fact that it is now seen to be in the interests of the plaintiff in the group proceeding, the group members and the defendants, that the plaintiff in the individual proceeding be brought back into the group for the purpose of effecting a proposed compromise, these matters alone cannot, without more, form a basis for over-riding the will and rights of the plaintiff in the individual proceeding”.
His Honour also considered whether an opt-out plaintiff could be compelled to re-join the group using the Court’s power under section 33ZF of the Act, which permits the Court to make “any order the Court thinks appropriate or necessary to ensure that justice is done in the proceeding”. Again however, His Honour observed that whilst he could make an order in the group proceeding, the opt out proceeding was not a proceeding within Part 4A of the Act and such a course appeared “contrary to the whole scheme12” of the Act.
The opt-out model under Part 4A of the Act entitles individuals to bring their own claims and Beach JA’s ruling demonstrates that the Court will not interfere with this entitlement, even in circumstances where the Court might consider that to “fold the plaintiff in the individual proceeding back into the group proceeding” would likely meet “many of the objectives and overarching obligations of the Civil Procedure Act 201013”.
Further, as Beach JA noted at paragraph , it was the “defendants’ choice not to settle with the plaintiff in the group proceeding or any group members, unless the plaintiff in the individual proceeding is a party to the settlement”.
However, once a person whose interests do not differ greatly from the group achieves an opt-out, that person may make resolution of the overall claim difficult, particularly in personal injury claims where a consistent approach toward all injured persons is desirable.
Whilst every individual has a right to bring his/her own claim, a lone ‘opt out’ creates tensions and difficulties for defendants and insurers, particularly in the settlement process. The defendants in this matter were hindered in their attempts to achieve a global settlement of claims. Further, the plaintiff in the group proceeding was placed in the position of having to face the prospect of running a lengthy and expensive trial when she (and the group she represented) were prepared to accept the sum offered by the defendants.
This matter demonstrates the difficulties created by the opt out system. Of course, M could have opted out at any time within the opt out period but on this occasion she failed to do so and was only permitted to proceed with her separate proceeding with the leave of the court.
^Back to top
Health Ombudsman Act 2013 (QLD): A New Landscape for the Regulation of Health Professionals in Queensland
Author: Paulina Moncrieff
In March 2012, a former Medical Board of Queensland investigator turned whistle-blower, reported to the Crime and Misconduct Commission serious allegations of widespread medical malpractice being covered up in Queensland. Her allegations prompted three investigations which led to a number of recommendations.
The Queensland Minister for Health, Mr Lawrence Springborg, subsequently announced dramatic changes to the administration of health complaints in Queensland. On 20 August 2013 the Health Ombudsman Act (the Act) was passed into law in Queensland. The Act has been proclaimed and all provisions will commence on 1 July 2014. Mr Leon Atkinson-MacEwen has been appointed Queensland Health Ombudsman and a newly appointed Medical Board has been announced. The Board will be headed by Associate Professor Susan Young from the University of Queensland School of Nursing and Midwifery.
Health Ombudsman Act
The Act represents a significant change to the regulation of health professionals in Queensland and a complete overhaul of the complaints and investigations system that previously existed. All complaints previously referred to as notifications pursuant to the Health Practitioner National Law Act 2009 (the National Law), are to be made to the Health Ombudsman.
The Health Ombudsman will replace the existing Health Quality and Complaints Commission (HQCC) and will act as a single point of contact for all health complaints within Queensland. The Health Ombudsman will also deal with serious disciplinary matters.
The Act combines a number of functions previously exercised by the HQCC and the National Law. The National Law will continue to be read in conjunction with the Act. All existing complaints before the HQCC not finally dealt with as at 1 July 2014 will be dealt with as a health service complaint by the Health Ombudsman.
The more important aspects of the Act are:
1. Immediate Action
The Health Ombudsman will have the power to take immediate action in response to a Health Service Complaint. The immediate action concerns immediate registration action (suspension or placement of conditions on a registered health practitioner) or issuing an interim prohibition order (prohibiting or imposing conditions on a health practitioner’s practice).
The Health Ombudsman can take either action without seeking clinical advice or submissions from the individual concerned.
When the Health Ombudsman proposes to take immediate registration action, he/she must give notice to the practitioner and invite a submission. The Health Ombudsman must allow 14 days for the submission and is to have regard to any submissions before deciding to take immediate action. However, the requirement to issue a show cause notice is suspended if the Health Ombudsman is satisfied that to do so would put the health and safety of an individual or the public at risk.
A practitioner to whom notice of proposed immediate registration action has been given can apply to the Queensland Civil and Administrative Tribunal (QCAT) for review of the decision. Of importance, the Act provides that QCAT must not grant a stay of the decision to take immediate action. Once the Health Ombudsman has made a decision to take immediate registration action he/she must start an investigation under the Act, refer the matter to the Australian Health Practitioners Regulation Authority or refer the matter to the Director of Proceedings, who is empowered with deciding whether proceedings should be taken against the health practitioner in QCAT.
Investigations must be completed within one year of a decision to conduct an investigation. Extensions will not be granted beyond three months. The Health Ombudsman is required to keep a public register on a publicly accessible website, of investigations not completed within one year after the decision to carry them out.
2. Interim Prohibition Orders (Division 2)
The Act gives the Health Ombudsman power to issue an Interim Prohibition Order which either, prohibits a health practitioner from providing any health service or a stated health service or imposes a restriction on the provision of any health service, or a State health service provided by that health practitioner.
The Health Ombudsman has the power to issue an Interim Prohibition Order if he or she is satisfied on reasonable grounds that the practitioner poses a serious risk to persons as a result of the practitioner’s health, conduct, or performance and it is necessary to issue the order to protect the public’s health or safety.
The Interim Prohibition Orders can also be issued at any time irrespective of whether or not a complaint has been made.
3. Publication of Orders
The Health Ombudsman must publish on its publicly accessible website, information about each current Interim Prohibition Order including:
the name of the health practitioner to whom the order was issued;
the day the order took effect;
the details of the order made against the health practitioner.
The Act also provides that the Health Ombudsman must publish information about corresponding interstate Interim Orders it is aware of. The Health Ombudsman has a discretion to publish the information any way he or she considers appropriate.
Areas of controversy
Interest groups ranging from individual practitioners, the Australian Medical Association and the Queensland Nurses Union all expressed significant concern in relation to what they consider are draconian measures in the Act.
The primary concerns are as follows:
1. Immediate action
The immediate action able to be taken by the Health Ombudsman has been raised as a concern in circumstances where such action potentially denies a practitioner natural justice by taking action before the practitioner has had sufficient time to respond in a considered way.
A practitioner can find him or herself barred from practising and unemployable before they have had a chance to query the imposition of immediate action.
2. Short Timeframes
The Act imposes very short timeframes within which a practitioner is able to respond to the Health Ombudsman’s intention to take immediate registration action or issue an Interim Prohibition Order. If a practitioner needs to obtain supporting evidentiary material and/or expert reports, it is unlikely this will be possible within the short 14 day timeframe.
The Health Ombudsman also has the power to shorten the 14 day time period as along as he/she believes it is reasonable in the circumstances.
The concerns relating to the Health Ombudsman’s powers in respect of taking immediate action are exacerbated by the limitation of the right to appeal the taking of such action. QCAT has been denied the power to grant an immediate stay of a decision to take immediate action which will force practitioners to apply to the Supreme Court for review of such a decision and significantly increase the potential legal costs in managing disciplinary proceedings.
Further, whilst QCAT retains a power of review over immediate action decisions, the length of time between lodging an application and an actual hearing may be unacceptably long, particularly in circumstances where practitioners may be limited or unable to engage in the practise of medicine in the intervening period.
4. Removal of privilege against self-incrimination
Sections 162(3) and 164(3) of the Act remove the privilege against self-incrimination in relation to enquiries undertaken by the Health Ombudsman. Pursuant to these provisions, witnesses cannot rely on privilege against self-incrimination to refuse to answer a question or supply a record. Whilst both provisions provide that any evidence given under the sections cannot be used in a civil, criminal or administrative proceedings, it has been argued the provisions nevertheless erode the fundamental right to silence in the face of self-incrimination.
5. Publication of Orders
The concerning aspect of the provisions relating to the publication of orders is the naming and shaming of practitioners in a public forum with the potential for significant, unrecoverable damage to their reputation, even if the allegations upon which the immediate actions are taken, are not later substantiated.
6. Single decision maker
The new Health Complaints regime will be overseen by the Minister of Health, who may direct the Health Ombudsman to investigate a particular matter and require the Health Ombudsman to give information and report to him or her regarding a particular matter. The Health Ombudsman is otherwise required to act independently, impartially and in the public interest and is not generally subject to directions.
Concern has been raised that as the provider of public health and hospital services in Queensland, the Minister for Health (and his or her Department), has an inherent conflict of interest when considering health complaint matters.
Further, there is no requirement in the Act that the Health Ombudsman be a medical practitioner or that they have clinical experience. The potential is for decisions to be made that do not reflect a balanced assessment of medical practice in Queensland at the time of the assessment.
7. Co-Regulatory Jurisdiction
Creating a co-regulatory jurisdiction in Queensland has the potential to undermine the ability of health practitioners to practice consistently across State borders. The creation of a nationally-consistent approach under the National Law allowed practitioners to practise anywhere in Australia with the security of having a consistent approach to registration and the complaints handling process. The changes under the Act erode that nationally consistent approach.
The Act represents significant change to the regulation of health professionals and their services in Queensland. The changes will present challenges for practitioners when a complaint is made against them. This is particularly the case in the absence of a formal complaint by a patient or fellow practitioner.
There will be considerable pressure on the Health Ombudsman and Director of Proceedings to resolve matters within a very short period of time. According to the Minister for Health “the tighter timeframes for complaints assessment, investigation and completion under the Act will give Queenslanders a more rigorous, accountable health complaints system, which will be the single point of lodgement for health complaints in Queensland.” One imagines the Minister for Health will be anxious to demonstrate that the changes have successfully ensured Queenslanders access health services in a safer, more accountable manner.
The emphasis is likely to be on the consumers of health services in Queensland, rather than the practitioners. The concern is that “improvements” in the complaints handling process are not achieved at the expense of practitioners being afforded due process and natural justice. Only time will tell whether the Act achieves a balance between these competing interests.
Privacy law reforms – the key changes in 2014
Authors: John Moran, Nick Abrahams
On 12 March 2014, extensive amendments to the Privacy Act 1988 (Privacy Act) came into force with the introduction of the Australian Privacy Principles (APPs) which have brought about a number of significant changes as to how “personal information” is to be collected, handled and disclosed by organisations with an annual turnover of greater than AU$3 million.
In this article we look at the key changes to the Privacy Act and we discuss how the changes are likely to impact the insurance industry.
The Key Changes
the types of personal information that an organisation collects and holds;
how the organisation collects and holds personal information;
to whom the organisation discloses personal information; and
if the organisation is likely to disclose personal information to overseas recipients, the countries in which such recipients are likely to be located.
Cross-border disclosure of personal information – the new provisions introduce a general obligation on organisations, before disclosing personal information to an overseas recipient, to take reasonable steps to ensure the overseas recipient does not breach the APPs (subject to specified exceptions). We discuss the practical implications of this change further below.
Collection of unsolicited personal information - where an organisation receives unsolicited personal information (for example, through a social media platform), it must determine within a reasonable period whether that personal information could have been collected lawfully. If not, then the unsolicited personal information must be destroyed or de-identified.
Direct marketing – the provisions have introduced new rules on how personal information can be used for direct marketing. These rules work in conjunction with the Spam Act 2003 (Cth) and Do Not Call Register Act 2006 (Cth) which also apply to direct marketing. The new rules provide that individuals may request the source of personal information held by an organisation about them. This obligation is expected to pose a challenge for many organisations whose IT systems are not configured to record that information.
Credit Reporting – the changes have brought about a simplified and enhanced correction and complaints process for individuals, and the introduction of civil penalties for breaches of certain credit reporting provisions.
Collection of sensitive information – under the new rules, sensitive information, including for example medical and health records or details of criminal prosecutions may (subject to certain exceptions) only be collected by an organisation if the individual has consented to the collection and the information is reasonably necessary for one or more of the organisation’s functions or activities.
The Privacy Commissioner, who is charged with monitoring and enforcing breaches of the new rules, has been provided with a range of new powers including the power to:
conduct an assessment of whether the personal information held by an organisation is being kept in accordance with the APPs;
make various determinations relating to the acts and practices of an organisation, such as compensation for loss suffered by individuals as a result of any interferences of an individual’s privacy;
accept enforceable undertakings by organisations in respect of breaches of the Privacy Act. Undertakings could include the payment of a fine, implementation of new systems and procedures, privacy training for staff, compliance reporting and audits; and
apply for civil penalty orders for serious or repeated interferences with privacy of up to A$340,000 for individuals and A$1.7 million for corporations.
As a result of the recent Budget it is proposed that the Privacy Commissioner from 2015 will form part of the Human Rights Commission.
Proposed further reforms
The Privacy Amendment (Privacy Alerts) Bill 2014 (2014 Bill) was introduced on 20 March 2014, and had its second reading in the Senate. The 2014 Bill relates to the mandatory notification of data breaches. While the 2014 Bill may yet change, if it is passed in its current form the proposed laws will require an organisation or agency to notify privacy breaches to the Privacy Commissioner if there is a “real risk of serious harm” to the affected individuals.
A notification to the Privacy Commissioner will need to include various details regarding the privacy breach, such as the personal information that was accessed and steps that individuals should take in response to the breach. In some circumstances the organisation or agency will also be required to notify the affected individuals or to publish public notices, which could of course potentially cause significant commercial and reputational damage.
Impact of the changes
On the compliance front, organisations should ensure that they have reviewed their Privacy Policies and other relevant policies (for example, policies relating to IT security and document retention and destruction) and reviewed their internal systems to cater for the new privacy amendments.
In particular, organisations should ensure that they take reasonable steps to ensure that overseas recipients of personal information collected in Australia do not breach the requirements of the APPs. Organisations may wish to consider putting in place specific contractual obligations with overseas entities regarding the storage, handling and use of personal information. Other contractual provisions that may warrant consideration include potential indemnities for breaches, compliance with specific security standards, procedures for handling access requests and complaints by individuals and rights of audit over how the personal information is held.
In terms of the impact of these changes on the industry, if the 2014 Bill is introduced and mandatory breach notification become a feature of the Australian privacy regime, Australia may follow in the footsteps of the United States, where class actions emanating from mass breaches of privacy obligations are occurring with increasing frequency.
If you are still working towards being privacy compliant following the recent privacy law changes, Norton Rose Fulbright have a fixed price Privacy Compliance Package. For more information regarding privacy in Australia please contact:
Norton Rose Fulbright Australia
+61 2 9330 8312
The ins and outs of proportionate liability – Perpetual Trustee Company Ltd v CTC Group Pty Ltd
Author: Darryl Smith
The policy behind the statutory defence of proportionate liability is at least in part to alleviate the prospect of a defendant unfairly bearing the entirety of a plaintiff’s commercial loss, in circumstances where it is only responsible for a small proportion of that loss. The corollary is, perhaps, that the defence should not be cast aside lightly.
In Queensland, it is not possible for parties to agree to forego their statutory recourse to a proportionate liability defence. In respect of the Victoria, South Australia, Australian Capital Territory, Northern Territory and Commonwealth provisions, the legislation is silent. In New South Wales, Western Australia and Tasmania, parties are entitled to agree to contract out of the defence, in certain circumstances. The recently released Model Provisions favour a prohibition on contracting out of proportionate liability, except in limited circumstances14.
In Perpetual Trustee Company Ltd v CTC Group Pty Ltd (No 2)15, the New South Wales Court of Appeal was asked to determine whether the plaintiff, Perpetual, and the defendant, CTC, had expressly contracted out of the proportionate liability provisions. The case involved a fraud perpetrated by a borrower against Perpetual. One of the bases of Perpetual’s claim for damages was that CTC had provided Perpetual with a contractual indemnity. In a previous decision, the Court found that CTC had failed to adequately identify the borrower, which was a breach of a warranty it had given to Perpetual. In the relevant contract, CTC had agreed to indemnify Perpetual in connection with any breach of warranty16.
The indemnity was provided prior to the introduction of the New South Wales proportionate liability scheme, and therefore did not contain any reference to the proportionate liability provisions. It follows that the indemnity did not explicitly exclude the operation of the proportionate liability defence. The indemnity simply allocated risk between the parties in a particular way.
In Perpetual, the New South Wales Court of Appeal decided that the parties had expressly contracted out of the proportionate liability defence because the parties had agreed to a contractual allocation of risk that was not consistent with the operation of the proportionate liability provisions. In particular, the Court held that “…the parties to the [relevant contract] have made express provision with respect to a matter covered by [the proportionate liability legislation].”
In Perpetual, the Court referred to (but did not rely upon) the decision of the Tasmanian Full Court inAquagenics Pty Ltd v Break O’Day Council17, where the Tasmanian Full Court held that relevant contracting out provision was “to ensure the primacy of express provisions of a contract”. The Court also cited a paper written by Professor McDonald18, which refers to “the significant restrictions that the [proportionate liability] legislation might impose on contractual allocation of risk if given too broad an interpretation”.
The decision in Perpetual highlights the tension between the scope that should be afforded to the proportionate liability defence, and primacy of contract. However, there are more important issues at play that are fundamental to the operation of the proportionate liability defence.
The reasoning in Perpetual shows that the Court turned to one of the plaintiff’s pleaded claims, being a claim regarding contractual allocation of risk, and then immediately considered whether the defendant was excluded from recourse to the proportionate liability defence due to that contractual allocation of risk. The Court found that the defendant was so excluded.
An alternative approach to that taken in Perpetual is to consider whether the proportionate liability defence applies19 before a determination is made as to whether the defence is excluded by the express contractual arrangements between the parties. This is an important distinction because, under this approach, contractual allocation of risk is relegated to only one of the numerous considerations that a court takes into account when determining whether the defence applies20.
The contract allocation of risk becomes relevant, rather than determinative. Only once the preconditions for the defence have been established is it necessary to determine whether the parties have agreed to contract out of the defence. Such an approach arguably highlights the need for parties to agree to an express (synonymously, an explicit or deliberate) provision to exclude the operation of the proportionate liability defence. It is arguably consistent with both the wording and the policy behind the proportionate liability legislation. It also prevents a plaintiff from evading the operation of the defence through selective pleading.
Secondly, while Perpetual may give weight to primacy of contract, it complicates another relevant contractual allocation of risk – the policy of insurance between the defendant and its insurer. Most insurance policies purchased by small to medium businesses exclude cover for liabilities assumed under contract, except to the extent that those liabilities would otherwise attach at common law or statute. If a defendant unintentionally contracts out of the proportionate liability defence, the defendant may be left holding a large uninsured risk21, being the difference between the amount the insurer would be required to pay if the defendant had recourse to the defence, and the amount the defendant has to pay without recourse to the defence.
Following the clarification of the scope of the proportionate liability defence provided by the High Court inHunt & Hunt22, it will be interesting to see whether Perpetual will be applied, or whether it will be confined to its particular facts.
Beware multiple insurance and indemnity clauses – Court of Appeal considers circumstances in which cover should be extended to principal
Author: Miranda Thomas
GIO General Limited v Centennial Newstan Pty Ltd
The recent NSW Court of Appeal decision of GIO General Limited v Centennial Newstan Pty  NSWCA 13 contains some useful points to note for the insurance industry regarding the construction of a contract between an insured contractor and its principal and the circumstances in which cover was extended to the principal.
Centennial Newstan Pty Ltd (Centennial) operated a coal mine at Fassifern, near Newcastle. Centennial had entered into an agreement with Longwall Advantage Pty Ltd (Advantage) for the supply of labour to perform work at Centennial’s coal mine (the Agreement). Advantage supplied the labour to Centennial through a separate agreement with another company, Longwall Labourforce Pty Ltd (Labourforce). Labourforce was the employer of Mr McDonald, whose services were supplied to the Centennial coal mine as a result of the Agreement.
In 2008, Mr McDonald was injured when his leg was crushed while working on the longwall installation at the Fassifern coal mine. He brought proceedings in the District Court against Centennial, Labourforce and Advantage for negligence and each of the three entities brought claims against each other for contribution and indemnity. Advantage maintained a “Combined Business Policy” (the Policy) with the appellant (GIO). Centennial therefore sought indemnity from GIO, claiming that it had the benefit of the Policy.
The definition of “You/Your/Insured” in the Policy wording extended to “every principal in respect of the principal’s liability arising out of the performance by or on behalf of the Named Insured of any contract or agreement for the performance of work for such principal, but only to the extent required by such contract or agreement.”
It was common ground between the parties that Advantage was a named insured under the Policy and that Centennial was a principal.
The first instance decision
The trial judge at first instance had determined that Centennial, Labourforce and Advantage were each liable to Mr McDonald and that for the purposes of contribution, Centennial should bear 100% of the liability. The trial judge was of the view that the Agreement operated in such a way so as to require Advantage to provide insurance cover which would indemnify Centennial as principal. GIO appealed, arguing that the obligation on Advantage to effect insurance in favour of Centennial pursuant to the Agreement did not include liability arising from Centennial’s own negligence.
In order to understand the arguments raised by GIO, together with the ultimate decision of the Court of Appeal, it is necessary to consider the way in which the various indemnity and insurance clauses in the documents which together constituted the Agreement interacted with each other. The Agreement contained numerous attachments as Schedules including the Centennial Standard Conditions of Contract (the Standard Conditions) and the Centennial Standard Contractors’ Site Regulations (the Site Regulations).
Clause 8.1 of the Standard Conditions stated that Advantage must indemnify Centennial and agree to hold Centennial harmless from all claims for:
“(a) injury to or death of any of your personnel, except to the extent that a claim for such injury or death arises as a result of the negligence of Centennial or a breach of this contract by Centennial.
(b) damage to or destruction of any property belonging to You or in Your possession or under Your control except to the extent the claim for such damage or destruction arises as a result of Centennial’s negligence or breach of this contract by Centennial.
(c) injury to or death of any person (including employees, agents or sub-contractors of Centennial) or damage to or destruction of any property…caused by an [sic] negligent acts or omissions by You or Your personnel or a breach of this contract by You.”Clause 43.2 of the Site Regulations set out “Special Insurance Requirements” and provided pursuant to subclause 43.2.2 that:
“Unless otherwise agreed in writing by the Principal [i.e. Centennial], public and product liability policies must note the Principal and all subcontractors as interested parties and must cover the respective liabilities of each of those parties to each other and to third parties. The policy must cover each indemnified party to the same extent as it would if each of the parties had a separate policy of insurance.”
Clause 43.4 of the Site Regulations contained an additional indemnity to the effect that “If [Advantage] neglects, fails or refuses to obtain any insurance policies as required by the Contract or the Standard Contractors Site Regulations [Advantage] must indemnify the Principal for any loss or damage suffered by the Principal arising out of or in connection with [Advantage’s] failure to obtain the required insurance.”
The Court of Appeal decision
Delivering the leading judgment in the Court of Appeal decision, Gleeson JA stated that the appeal turned on the single issue of whether Advantage was required by clause 43.2.2 to provide insurance cover to indemnify Centennial against its liability to Mr McDonald.
The Court of Appeal rejected GIO’s argument that Clause 8.1 of the Standard Conditions operated to exclude cover in the event of liability arising from Centennial’s own negligence. It held that Clause 8.1 of the Standard Conditions needed to be read in conjunction with the indemnity and insurance clauses contained in other documents which together constituted the Agreement, in particular the Site Regulations.
Gleeson JA stated that the Court must consider the entire Agreement; this included the numerous Schedules to the Agreement. He noted, in particular, that “The words of every clause must, if possible, be construed so as to render them all harmonious with one another.”
Consequently clause 43.2.2 was “intended to provide cover to Centennial and all subcontractors of Advantage beyond the scope of the indemnity afforded to Centennial under cl 8.1 of the Standard Conditions.” This interpretation and construction of the relevant clauses was supported by the existence of the additional and wider indemnity clause in Clause 43.4 of the Site Regulations. The indemnity in Clause 43.4 would be otiose if the insurance obligation in Clause 43.2.2 served only to support the narrower indemnity pursuant to Clause 8.1 of the Standard Conditions.
Accordingly, GIO’s appeal was dismissed. The Court of Appeal agreed with the trial judge, determining that it was not “overwhelmingly improbable that the parties intended that Advantage would maintain insurance cover in respect of Centennial’s own liability for negligence to an employee, agent or subcontractor or Advantage”. Specifically, Clause 43.2 of the Site Regulations which contained special insurance requirements backed up by the indemnity in Clause 43.4 “was clearly directed to providing Centennial with cover of the same character under the policy for its own interests in the performance of the agreement by Advantage.”
GIO was therefore liable to cover the claim made by Centennial as a result of the principal’s liability extension in the definition of “Insured” in the Policy.
Key points to note
Where the definition of “Insured” in a policy extends to any principal, careful consideration needs to be given to the interaction between the various indemnity and insurance clauses in any agreement between the insured and the principal.
Here, the contract in question between Centennial and Advantage was essentially a one page document to which a number of different Schedules were attached (including the Standard Conditions and Site Regulations) which were thereby incorporated into the contractual terms. The case serves as a useful reminder that where there are multiple indemnity and insurance clauses contained within various documents which together constitute a written contract between principal and insured, these must be construed in accordance with the facts. The intent of the parties will be evidenced by the agreement taken as a whole.
The Court made it clear that its preference is to interpret the overall agreement in such a way which renders competing clauses “harmonious with one another”, if at all possible.
It is therefore important not to read or to rely upon indemnity clauses in isolation.
The case also underlines the need to ensure that indemnity and insurance clauses are carefully drafted from the outset in order to avoid potentially unintended consequences for the parties concerned.
Insurer reduces its liability to nil - Prepaid Services v Atradius (no 2)  NSWSC 21
Author: Alma Geraghty
In this case, Justice McDougall of the New South Wales Supreme Court considered whether, pursuant to s 28(3) of the Insurance Contracts Act1984 (Cth), Atradius Credit Insurance NV (Atradius) was entitled to reduce its liability under the policy to nil, on the basis of non-fraudulent misrepresentation.
His Honour held that on the balance of probabilities, had Atradius been given truthful and complete answers in response to its insurance proposal, it would not have issued the policy and was entitled to reduce its liability to nil.
Atradius issued a trade credit insurance policy in favour of Prepaid Services Pty Limited, Optus Mobile Pty Limited and Virgin Mobile (Australia) Pty Limited (the Insured). The policy insured against the insolvency of one of the Insured’s major debtors, a company known as Bill Express Limited (BXP), and against BXP's failure to pay amounts owing to any of the Insureds. BXP became insolvent and the Insured made a claim under the policy. Atradius argued that, had proper disclosures been made, it would not have issued the policy at all. His Honour noted that it was not submitted that a policy would or might have been issued, but on different terms23.
In 2012, Justice McDougall found24 that Atradius was entitled to avoid the policy by reason of fraudulent misrepresentations pursuant to s 28(2) of the Insurance Contracts Act 1984 (Cth) and that if the representations were not fraudulent, Atradius was entitled to reduce its liability to nil under s 28(3).
However the NSW Court of Appeal25 did not agree and found that the conclusion that there had been a fraudulent misrepresentation must be set aside and remitted the question of whether Atradius was entitled to reduce its liability to nil back to His Honour.
The Application of s 28(3)
Section 28(3) of the Insurance Contracts Act (Cth) operates if an insurer is not entitled to avoid a contract of insurance by reason of a failure to disclose, or a misrepresentation, by the insured. It provides that the liability of the insurer in respect of a claim is reduced to the amount that would place the insurer in a position in which the insurer would have been if the failure had not occurred or the misrepresentation had not been made26.
“This provision requires an inquiry as to the position the insurer would have been in if the relevant misrepresentation had not been made…..Accordingly, it must establish on the balance of probabilities what it says its position would have been if the misrepresentation had not occurred. That is so notwithstanding that the hypothesis upon which the reduction of liability is based is not an historical fact27”
Justice McDougall was required to consider hypothetical inquiries that would have been made by Atradius had they been provided with full disclosure as to BXP’s financials and the response the Insured would have provided and how Atradius would have dealt with this further information. His Honour noted that the information obtained from these further inquiries would have persuaded Atradius that “BXP was a buyer that Atradius did not want to insure”.
Justice McDougall found in favour of Atradius and accepted that had complete answers been provided in the proposal form, Atradius would not have issued the policy and noted that s 28(3) did not impose an obligation on the insurer to make continued inquiries of the insured in order to discharge its burden of proof.
This decision highlights the importance of making complete and accurate disclosures and representations when entering into a policy of insurance and the difficulties faced in establishing that a misrepresentation would not have altered an insurer’s decision to issue a policy.
It also demonstrates to insurers seeking to rely on this provision the likely considerations of a court in relation to underwriting practices and procedures and in the event that certain non-disclosed material is provided to the insurer what, if any, further inquiries would have been made and responses to such inquiries when determining whether the policy would have been issued.
Maintaining Confidence in Equity – the protection of Legal Advice and other Confidential Information
Author: Helen Gill
The Supreme Court of Victoria considered whether equity could restrain Melbourne City Investments Pty Ltd from relying on a document pleaded in its Amended Statement of Claim that contained ‘highly sensitive legal advice’ and was confidential to Leighton Holdings Ltd.
The decision of Judd J demonstrates the value of confidentiality and obligations of confidence, and the reluctance of courts to find, absent strong evidence, that confidentiality has been waived or lost . It also emphasises that equity may come to the assistance of a party to protect information over which legal professional privilege has been lost, if the criteria for equitable protection set out in Corrs Pavey Whiting & Byrne v Collector of Customs (Vic) (1987) 14 FCR 434 has been satisfied.
Leighton Holdings Ltd (LEI Holdings) is a public company listed on the Australian Securities Exchange (ASX). Melbourne City Investments Pty Ltd (MC Investments) is an investment company that held ED securities in LEI Holdings (LEI ED securities).
On 3 October 2013, a sharp fall in the price of LEI ED securities was precipitated by reports of misconduct by officers of LEI Holdings in newspaper articles.
By a Writ filed on 4 October 2013, MC Investments commenced a group proceeding against LEI Holdings in the Supreme Court of Victoria. A Statement of Claim was filed on 4 November 2013, then amended by Amended Statement of Claim filed on 26 November 2013.
MC Investments alleged that, contrary to the Corporations Act 2001 (Cth) and the ASX Listing Rules, LEI Holdings had failed to make various time-sensitive disclosures to the market about matters that would reasonably be expected to have a material effect on the price or value of LEI ED securities. Further, that such information as LEI Holdings had disclosed about those matters was inadequate or misleading, and had not been disclosed in a timely manner.
MC Investments claimed that due to the disclosure failures the market was not fully informed about the matters in question until a much later date when they were reported in the media, and that it and other shareholders (Group Members) sustained loss and damage by and as a result of those failures and the misleading or deceptive conduct of LEI Holdings.
In the action, MC Investments sought to rely on a letter of advice dated 20 December 2010 from Herbert Geer Lawyers to the Chief Operating Officer of LEI Holdings (Letter of Advice). It expressly pleaded both the Letter of Advice and its content as a material fact in paragraph 12 of the Amended Statement of Claim.
By a Summons filed on 9 December 2013, LEI Holdings applied to the Court for orders restraining MC Investments from making use of the Letter of Advice and its content in the action, among other things. In particular:
An order that the whole of the Amended Statement of Claim be struck out or, alternatively, that paragraph 12 and paragraphs 2 and 13 (insofar as they referred to paragraph 12) be struck out.
An order that MC Investments deliver up or destroy all copies of the Letter of Advice.
An injunction restraining MC Investments from making use of information contained in the Letter of Advice.
The Summons was listed for hearing on 18 December 2013 before His Honour Justice Judd.
At the hearing, LEI Holdings framed its application for relief as a claim in equity based on established principles for the protection of confidential information.
A claim for the protection of legal professional privilege was not pursued as the privilege had been lost when MC Investments and its solicitor obtained possession of a complete copy of the Letter of Advice from an undisclosed third party28, and through partial disclosure of its content in at least two newspaper articles published on 5 October 2013.
LEI Holdings contended that it was entitled to the protection of equity to prevent MC Investments from using the Letter of Advice or information it contained in the action, as each of the criteria for equitable protection propounded by Gummow J in Corrs Pavey Whiting & Byrne v Collector of Customs (Vic)29 had been satisfied. That is to say:
The information in question could be identified with specificity;
The information had the necessary quality of confidentiality;
The information was received by MC Investments and its solicitor in circumstances that imported an obligation of confidence; and
There had been actual and/or threatened misuse of the information by MC Investments.
MC Investments advanced argument to the contrary. It opposed the application on three grounds.
First, MC Investments raised a threshold objection. It contended that the application must fail as LEI Holdings had adduced no evidence to support the claim that the Letter of Advice was confidential, or that it was ever had been the subject of an obligation of confidence owed to it.
The objection did not succeed. The Court found that the Letter of Advice itself had evidentiary value and supported the claim for confidentiality.
The letter contained ‘highly sensitive legal advice’ prepared by a partner of Herbert Geer Lawyers for LEI Holdings and was headed with the endorsement: ‘Subject to legal professional privilege’. His Honour opined that the privilege claimed in the endorsement, together with the nature and content of the letter, strongly implied that the author intended the communication to be confidential. Further, he stated that: ‘In the absence of evidence to the contrary, it would be fanciful to conclude that [LEI Holdings], to whom the confidential advice was directed, did not also intend that the communication was, and should remain, confidential.’
Second, MC Investments argued that LEI Holdings, by its conduct, had either waived or abandoned the claim for confidentiality. Key to that argument was the fact that LEI Holdings had failed to take action to assert that the publication on 5 October 2013 of two newspaper articles that disclosed part of the content of the Letter of Advice had occurred in breach of an obligation of confidence owed to it. MC Investments submitted that, by reason of that failure to act, it was now ‘too late’ for LEI Holdings to advance a claim for confidentiality in respect of the Letter of Advice.
That argument was rejected. The issue before the Court was whether LEI Holdings could prevent MC Investments from making use of the Letter of Advice and its content in the action. Central to that issue was an appreciation that the Letter of Advice and the information it contained was materially different to, and therefore distinct from, that which was published in the newspaper articles on 5 October 2013. This distinction was not grasped by MC Investments. The Court found that MC Investments had ‘overlooked a material difference between that which was published in newspapers and [its] intended use of the [Letter of Advice]that came into its possession.’
His Honour also noted that prior to receipt of service of the Statement of Claim filed 4 November 2013, LEI Holdings was not aware that MC Investments intended to use the Letter of Advice and its content in the action. However, on becoming aware of that use, LEI Holdings took immediate action to protect the confidential information by seeking delivery up or destruction of all copies the Letter of Advice by MC Investments, first by solicitor’s letter and then by Summons.
Third, MC Investments argued that the criteria for equitable protection were not satisfied. It submitted that it had received the Letter of Advice free from any obligation to keep it confidential, and from a source that was not bound by any obligation of confidentiality. It also contended that the content of the Letter of Advice could not be regarded as confidential as it had been ‘widely circulated for three years’ and partially disclosed in newspaper articles. MC Investments failed, however, to adduce any evidence to explain the circumstances in which it came to possess the Letter of Advice, or the foundation for its assertion that the content of the Letter of Advice had been widely circulated to third parties for three years.
In the circumstances, the Court found that MC Investments and its solicitor (who was also the director) must have appreciated on receipt of the Letter of Advice that it was confidential to LEI Holdings, and that the prudent course would be to confirm the status of the document with LEI Holdings prior to pleading it in the Amended Statement of Claim.
Noting the absence of evidence of any such enquiry by MC Investments, the Court inferred that MC Investments and its solicitor knew, or at least suspected, that any enquiry made of LEI Holdings would prompt an application for an injunction to restrain its use of the Letter of Advice in the action. That MC Investments, with that knowledge or suspicion, proceeded to plead the Letter of Advice as a material fact in the Amended Statement of Claim, constituted both actual and threatened misuse of the information it contained.
The third argument advanced by MC Investments was therefore also rejected.
In the result, the Court made orders requiring MC Investments to deliver up or destroy all copies of the Letter of Advice, and restraining it from further use of the confidential information. Paragraph 12 and all references to that paragraph were also struck from the Amended Statement of Claim.
The following points can be drawn from the decision:
Parties to litigation should take care that the information on which they are seeking to rely in the action is not confidential to another party to the proceeding or a third party. If the status of the information is unclear, enquiries should be made of the relevant party or third party prior to any use being made of the information.
Parties should also take immediate steps to protect their confidential information on becoming aware of an actual or threatened use of the information, in order to avoid an allegation that confidentiality has been waived. The protective steps taken may be informal, formal or a combination of the two.
Equity may come to the assistance of a party to protect information over which legal professional privilege has been lost, if the criteria for equitable protection set out in Corrs Pavey Whiting & Byrne v Collector of Customs (Vic) (1987) 14 FCR 434 has been satisfied.
^Back to top
Amendments to Offers of Comprise in Victoria
Author: Jessica Kerr
The cost consequences of an unaccepted offer of compromise mean that the making of an offer can encourage settlement. Amendments to the rules concerning offers of compromise for proceedings in the Supreme Court of Victoria came into effect on 1 September 2013 and were made by the Supreme Court (Chapter I Offers of Compromise Amendments) Rules 2013 (Vic).
These rules made significant changes to the cost consequences of offers of compromise pursuant to order 26 of the Supreme Court (General Civil Procedure Rules) 2005. The changes require that an offer of compromise must provide for costs, extend the time for payment and allow the court to consider pre-litigation offers of compromise. Further, an order has also been introduced to provide for indemnity costs orders and there is no longer a requirement to serve a written acknowledgement of service on the offeror.
Costs – inclusive or in addition?
An offer to compromise must, pursuant to r 26.02(4), now state whether the offer is inclusive of costs or that costs are to be paid or received in addition to the offer. Previously, costs were determined according to the s 24(1) of the Supreme Court Act 1986. The new r 26.03(7) guides the operation of r 26.04.
The position is now that if an offer of compromise is accepted, and costs are to be paid or received in addition to the offer, then, unless otherwise ordered:
the costs are the be paid or received in respect of the claim up to and including the day the offer was served;
liability for any costs in relation to any subsequent period shall be in the discretion of the court; and
any party to the accepted offer may apply for the taxation of costs.
Time for payment extended
Changes to r 26.03.1 have extended the time for payment. An offer of compromise providing for payment of a specified sum of money has been extended from 14 to 28 days after the acceptance of the offer. If the payment is not made within 28 days, the plaintiff may enforce the compromise pursuant to r 26.07.1. Rule 26.03(5) provides that an offer of compromise shall not be withdrawn during the time it is open to be accepted unless the court otherwise orders.
Withdrawal of acceptance of offer
Previously r 26.07 only dealt with the failure to comply with an accepted offer. The new order was introduced to provide for circumstances in which a party may withdraw its acceptance. Rule 26.07 now allows a party who has accepted an offer for the payment of a sum of money to withdraw the acceptance if the money is not paid in the time provided or within 28 days if no other time is specified.
The court also has the power to grant leave to withdraw acceptance. A party seeking leave to withdraw acceptance may also seek orders to restore their position to that at the time of acceptance and also seek orders regarding the further conduct of the trial.
Rule 26.07.1 deals with the failure to comply with an accepted offer and the remedies available to the offeree. The remedies include an order:
Giving effect to the accepted offer;
Staying or dismissing the proceeding if the plaintiff is in default;
Striking out the defendant’s defence if the defendant is in default; or
That a claim, not the subject of the offer, shall proceed.
Pursuant to r 26.07.2, if there are multiple defendants, and two or more defendants are alleged to be jointly or jointly and severally, liable to the plaintiff for a debt or damages and rights of contribution or indemnity appear to exists between the defendants, r 26.07.01 does not apply. However, r 26.07.1 does apply if –
In the case of an offer made by the plaintiff, the offer –
Is made to all defendants; and
Is an offer to compromise the claim against all of them; or
In the case of an offer made to the plaintiff –
The offer is to compromise the claim against all defendants; and
If the offer is made by two or more defendants, those defendants offer to be jointly, or jointly and severally, liable to the plaintiff for the whole amount of the offer.
Indemnity Costs – change of time
Rule 26.08 establishes the costs penalty that a party served with an offer of compromise will incur if the party does not accept the offer and the judgment at trial is not more favourable. The commencement of the time from which a party may become entitled to receive or obliged to pay indemnity costs has been altered from the day the offer was served to 11.00 am on the second business day after the offer was served.
Two new definitions have been inserted which are relevant to this section including business day and ordinary applicable basis.
The previous r 26.08(4) has been revoked and a new rule substituted. The test is now whether the plaintiff “unreasonably fails to accept” the defendant’s offer.
Rule 26.08.1 is a new rule which allows the court to have regard to a pre-litigation offer when making a costs order. This change could be of real importance for parties. If a reasonable offer was made before the initiation of litigation, the offer was open for a reasonable time but was not accepted and the offeror obtains an order or judgment on terms no less favourable, the court can take such matters into account in determining what costs orders should be made.
The court has discretion regarding the costs and may order that the offeree pay all or part of the offeror’s costs of the proceeding taxed on a basis other than a party and party basis from the day the offer was made, the commencement of the proceeding or any other time the court thinks appropriate.
Practitioners need to be mindful of any pre-litigation offers being made as it is likely the court with consider such offers when determining costs. Also, rejecting a pre-litigation offer could potentially expose the client to an order for indemnity costs.
Rule 26.10 previously concerned defendants making offers to contribute. It is now directed to the costs and issues between defendants and not to any issue between the plaintiff and defendant. The rule states that:
If two or more parties (the contributor parties) may be held liable to contribute towards an amount of debt or damages that may be recovered from the contributor parties, any of those contributor parties may, without prejudice to that contributor party's defence, make an offer to another contributor party, to contribute, to a specified extent, to the amount of the debt or damages.
If an offer is made by a contributor party (the first contributor party) and not accepted by another contributor party, and the first contributor party obtains a judgment against the other contributor party more favourable than the terms of the offer, then, unless the Court otherwise orders, the first contributor party is entitled to an order that the contributor party who did not accept the offer pay the costs incurred by the first contributor party -
before 11.00 a.m. on the second business day after the offer was served—on the ordinarily applicable basis; and
after the time referred to in paragraph (a)—on an indemnity basis.
Limitation period for recovery of costs under s 60 of the Motor Accident Insurance Act 1994 (Qld) clarified
Author: Natalia Kepa
In Nominal Defendant v Star Motorcycles Pty Ltd & Anor  QDC 41, a dispute arose before Judge Dorney QC DCJ as to whether a Nominal Defendant's cause of action pursuant to s60 of the Motor Accident Insurance Act 1994 (Qld) (MAI Act) arose a single time, upon the first instance of the incurrence of costs related to a personal injury claim, or whether a cause of action arose each time costs were incurred with regards to the claim.
The question arose in the context of a motorcycle incident which occurred in 2003 and for which the first costs in relation to the claim were incurred by the Nominal Defendant on 4 February 2004. Further costs were incurred in relation to the same claim from 4 February 2004 to 6 November 2006. Six years from 6 November 2006, the Nominal Defendant instituted proceedings against the owner of the motorcycle (first defendant) and the alleged driver (second defendant) to recoup some of the costs.
The first defendant, seeking to strike out the Nominal Defendant’s claim, argued that the action was statute-barred because it was instituted more than 6 years following the first incurrence of costs related to the personal injury claim, in contravention of s10(1)(d) of the Limitations of Actions Act 1974 (Limitation Act).
Dorney QC DCJ reviewed the first defendant’s position in light of the English decision Legal Services Commission v Rasool  3 All ER 381 (Rasool), an authority which supported a single cause of action.
In Rasool, the Legal Services Commission instituted proceedings seeking to recover from the defendant the costs incurred for the legal aid services rendered prior to the defendant’s legal aid certificate being revoked. In this case, the legal aid certificate was revoked in March 1999, the costs were taxed in December 2001 and proceedings to recover the monies owed were instituted in 2006. The time limit in this case was six years from the date on which the cause of action accrued.
The issue before the Court in Rasool was whether the limitation period began to run upon revocation of the legal aid certificate or whether it began to run once the sum recoverable by the Legal Services Commission for these services was ascertained. It was held in Rasool that the cause of action accrued on the revocation of the certificate, despite the fact that the costs incurred under the legal aid certificate were not yet determined. The Court was of the view that, because a declaratory relief was available, the ascertainment of the costs was a mere procedural exercise and not an inherent element of the cause of action itself.
An important distinction between Rasool and the present case was, according to Dorney QC DCJ, that the ascertainment of future costs in this instance was not a mere procedural exercise for which a declaratory relief was available. Indeed such “costs reasonably incurred by the Nominal Defendant” (which included future medical expenses, rehabilitation services, etc) could not be determined without hypothesising and it would be difficult to provide a declaratory relief in such circumstances without “embarking upon a theoretical exercise” in relation to costs which were “at best, impending, threatened or expected”.
The Court affirmed that, for the purposes of calculating the limitation period applicable to proceedings instituted by a Nominal Defendant under s60 of the MAI Act, there may be successive causes of action, each arising when costs are incurred by a Nominal Defendant in relation to the personal injury claim. The position adopted by the court is consistent with the approach adopted by the Victorian courts in respect of s 138 Accident Compensation Act recovery actions by the Victorian WorkCover Authority.
Federal Court rules on “substantial alteration” of property: High Court says economic capping does not apply in relatives’ claims
Author: Toby Biddle
In April the High Court found that economic loss capping provisions in the Civil Liability Act 2002 (NSW) did not operate to limit damages for financial dependency for relatives under the Compensation for Relatives Act 1897 (NSW). The decision could lead to a significant increase in potential damages in fatal accident claims in NSW and Victoria, and claims under the Competition & Consumer Act 2010 (Cth).
Susan Taylor’s husband was killed when a shop awning collapsed on him. Mrs Taylor commenced proceedings in the NSW Supreme Court claiming damages under theCompensation to Relatives Act.
The principal issue for determination was whether, in awarding damages for loss of expectation of financial support, the “cap” on damages provided for in s 12(2) of the CLA applied to the claimant’s gross weekly earnings, or the deceased’s earnings. Section 12(2) of the CLA directs the Court when awarding damages to disregard the amount (if any) by which the “claimant’s” gross weekly earnings would, but for the injury or death, have exceeded three times the average weekly earnings at the date of the award.
The earnings of the deceased (Mr Taylor) would have been substantially more than three times average weekly earnings. At first instance and in the NSW Court of Appeal it was held that the literal meaning of s 12(2) produced a result inconsistent with the purpose of the legislation, being to limit claims and damages and restrict financial loss claims for high earning individuals. The Court of Appeal held that “claimant” should be read as if it referred to “the claimant’s or the deceased’s gross weekly earnings”.
The majority of the High Court (French CJ, Crennan and Bell JJ) disagreed, finding that the purposive construction adopted by the primary judge and the Court of Appeal, could not be reconciled with the language of the statute as enacted by parliament. While accepting that purposive construction of statutes is permitted by authorities and often may be appropriate, adopting a purposive construction which departs too far from the statutory text compromises the separation of powers in the Constitution.
In a dissenting judgment, Gageler and Keane JJ dismissed the appeal. Their reasons differ slightly from the majority in the NSW Court of Appeal. Gageler and Keane JJ considered the statutory object was achieved if the “claimant’s gross weekly earnings” was read as referring to the gross weekly earnings on which the claimant relies in making the claim for damages.
The High Court judgment reopens the door for potentially massive uncapped damages in favour of surviving relatives of high earning individuals killed by the negligence or wrongdoing of others. The decision has implications beyond New South Wales – there are equivalent provisions in the Wrongs Act 1958 (Vic) and in the Competition & Consumer Act 2010 (Cth).
The equivalent provisions in tort reform legislation in Queensland, Western Australia, South Australia and the Australian Capital Territory all make it clear that the capping does in fact apply to deceased’s earnings. Given this, some attempts at statutory amendment might be expected in New South Wales, Victoria and to theCompetition & Consumer Act 2010.
Those in glass houses… - The Federal Court on “substantial alterations” under the Building Code of Australia
Authors: Matthew Hodgkinson, Toby Biddle
In the Australian Capital Territory, alterations to buildings are regulated by the Building Act 2004 (ACT) (the Act) and the Building (General) Regulations 2008 (ACT) (the Regulations). Australia-wide, the Building Code of Australia (the BCA) provides the minimum requirements necessary for the certification and approval of new and improved dwellings.
Under s29 of the Act, if a “substantial alteration” is made to a building, the building must be re-assessed for compliance with the BCA and re-obtain the required certification. The Regulations relevantly provide:
for a Class 1 (residential) building – a “substantial alteration” takes place when the total floor area of the proposed alteration, not including any internal alteration, is more than 50% of the floor area of the original building; and
neither refitting a building nor replacing the internal elements of the building is an alteration of the building unless the layout and function of the internal spaces of the building are changed.
On 28 February 2014 Justice Foster of the Federal Court considered the definition of “substantial alteration” as it is described in the Act, and clarified how it is to be interpreted. The interpretation has important implications for home insurance policies.
Mrs Jayammal Vivekananda, the original Applicant in the proceedings, owned a 5 bedroom residential property located at 6 Macrobertson Street, Mawson, ACT. On 24 July 2011, the house was severely damaged by fire and was rendered uninhabitable due to the roof needing to be demolished and replaced.
Insurance Australia t/as NRMA Insurance (the NRMA) insured the property for damage, including cover for damage by fire. Mrs Vivekananda made a claim for the reconstruction of the house under the policy, claiming replacement of the roof was a “substantial alteration” under the BCA, meaning that the entire house needed to be certified as compliant. NRMA’s position was that only repair costs (primarily of the roof) were payable. The determination of this issue turned on whether re-building of the roof was a substantial alteration under the BCA.
On 13 July 2012, Mrs Vivekananda died and her estate (including the legal claim) vested in her son and executor of her estate, Mr Ravichandra Vivekananda.
Mr Vivekananda argued that, since the roof of the house was present across the surface area of the entire residence, the alterations affected more than 50% of the property and was therefore substantial.
NRMA argued that an “alteration” to an existing property requires that the area of the house be altered. If the reinstatement of the property was an “alteration”, NRMA further argued that the Act and Regulations envisioned that any “substantial alteration” would increase the floor area of the original building by more than 50%. NRMA argued that the replacement of the roof, restoring the property to its original condition and size, did not constitute a “substantial alteration” under the Act.
The Court adopted a literal interpretation of the BCA, finding in favour of NRMA. It ruled that the restriction to 50% of the existing building reflected the intent of the legislation to limit only those alterations which increased the area of the building by more than 50%. Provided that the area stays the same throughout the reinstatement, no “substantial alteration” will take place within the meaning of the BCA even if the alterations are otherwise significant (such as replacement of an entire roof).
The Court therefore found that NRMA was not liable for the full cost of rebuilding of the property to comply with the BCA, but would be liable to reinstate the property to its original condition.
The solicitors for Mr Vivekananda have indicated that they may appeal the decision.
All states in Australia have adopted the BCA through separate legislative and regulatory arrangements. This decision potentially provides guidance for interpretation on when the Code will be applied to existing renovations as well as providing direction for insurers on the costs of reinstatement of existing dwellings under property damage policies.
The plaintiff sued the State of Victoria on the basis that it is vicariously liable for breaches of duty committed by the Minister for Agriculture (the Minister), the Secretary to the Department of Primary Industries (the Secretary), the Chief Veterinary Officer of the State of Victoria (Dr Millar) and the Executive Director of Fisheries Victoria (Dr Appleford) (collectively, the State tortfeasors).
The virus escaped from a farm operated by Southern Ocean Mariculture Pty Ltd (SOM) into the Drain Bay, from where it spread along the Victorian coast.
Pyrenees Shire Council v Day  HCA 3;192 CLR 330; 151 ALR 147; 72 ALJR 152 (23 January 1998).
Graham Barclay Oysters Pty Ltd v Ryan  HCA 54; (2002) 211 CLR 540; (2002) 77 ALJR 183; (2002) 194 ALR 337
Sullivan v Moody  HCA 59; 207 CLR 562; 75 ALJR 1570; 183 ALR 404; 2001 Aust Torts Reports 81-622; 28 Fam LR 104.
The original calculation of economic loss sustained by the group members identified by the plaintiff was over $8 million.
His Honour held that “…notions of proximity and general reliance are no longer considered to provide the answer to the question of whether an authority should be considered to have been obliged to exercise its powers”.
His Honour held that “…notions of proximity and general reliance are no longer considered to provide the answer to the question of whether an authority should be considered to have been obliged to exercise its powers”.
For example, plaintiffs may be able to fashion their claims as violations under Section 11 of the Securities of the Act of 1933 or as claims based on omissions instead of misrepresentations to bring class actions. In either case, plaintiffs would not have to prove reliance.
S CI 2011 06574
S CI 2012 2791
Parliamentary Counsel’s Committee for the Standing Council on Law and Justice – Proportionate Liability Model Provisions, 26 September 2013, section 12.
 NSWCA 58.
The indemnity was in the terms that CTC indemnified Perpetual “… against any liability or loss… incurred in connection with…any breach by [CTC] of any of its warranties…under this deed, including, without limitation, liability, loss, costs, charges or expenses….”
(2010) 20 Tas R 239.
McDonald, B, Indemnities and the Civil Liability Legislation (2011) 27 JCL 56.
The relevant wording of the Civil Liability Act 2002 (NSW), section 3A(2) is: “This Act…does not prevent the parties to a contract from making express provision for their rights, obligations and liabilities under the contract with respect to any matter to which this Act applies and does not limit or otherwise affect the operation of such express provision”.
For example, when determining whether the claim is an apportionable claim which arises out of a failure to take reasonable care, a court will make its judgment in the light of all of the findings made: Reinhold v New South Wales Lotteries Corporation (2008) 82 NSWLR 762.
Using Hunt & Hunt Lawyers v Mitchell Morgan Nominees (2013) 247 CLR 613 as an example, there would be an uninsured risk in the amount of 87.5% of the plaintiff’s loss, being the percentage by which the defendant’s liability was limited under the proportionate liability legislation .
Hunt & Hunt Lawyers v Mitchell Morgan Nominees (2013) 247 CLR 613.
Prepaid v Atradius (no.2)  NSWSC 21 at  – 
Prepaid Services Pty Ltd v Atradius Credit Insurance NV  NSWSC 608
Prepaid Services Pty Ltd & Ors v Atradius Credit Insurance NV  NSWCA 252
Prepaid v Atradius (no.2)  NSWSC 21 at 
Prepaid Services Pty Ltd & Ors v Atradius Credit Insurance NV  NSWCA 252; Meagher JA at 
Australian Securities and Investments Commission v Lindberg  VSCA 234 per Mandie JA at 
(1987) 14 FCR 434 at 443
^Back to top
Explore our site
Search our people
Infrastructure, mining and commodities
Technology and innovation
Life sciences and healthcare
Abu Dhabi • Almaty • Amsterdam • Athens • Austin • Bahrain • Bangkok • Beijing • Bogotá • Brisbane • Brussels • Calgary • Canberra • Cape Town • Caracas • Casablanca • Dallas
Dar es Salaam • Denver • Dubai • Durban • Frankfurt • Hamburg • Hong Kong • Houston • Jakarta* • Johannesburg • London • Los Angeles • Melbourne • Milan • Minneapolis
Montréal • Moscow • Munich • New York • Ottawa • Paris • Perth • Piraeus • Pittsburgh-Southpointe • Québec • Riyadh* • Rome • San Antonio • Shanghai • Singapore • St. Louis
Sydney • Tokyo • Toronto • Warsaw • Washington DC *Associate office
Anti-bribery and corruption standard