This principle is embodied in Recommendation 39. The Panel explains that the policy defence should be available only when a conscious decision regarding the performance or non-performance of the function is made [10.28].
The Panel expressly restates that the policy defence does not confer immunity. It serves to restrict the ambit of disputes about policy, thereby reducing the number of claims [10.30].
Implementation of the policy defence
Such a defence is not new, it was rejected by the High Court in Brodie. Thus, the States were reintroducing the defence through legislation. This allowed the statutory authorities to be better protected against frivolous claims, diverting limited resources to the defence of their policies in court.
The reintroduction of the defence by the Western Australian legislature displayed an adherence to the principles recommended by the Panel. This is most evident in the almost exact replication of Recommendation 39 as section 5X of the CLA. That provision prevents the public authority from being completely immune through holding them liable for unreasonable decisions leading to negligence.
There was no uniform implementation of the recommendations across Australia. New South Wales, for example, does not have Recommendation 39 in its Civil Liability Act.
Adversaries
The Panel and the initiative for the reforms and the reforms themselves have attracted much criticism.
Critics expressed a disapproval of the Panel, claiming partiality due to vested interests. Certain groups felt the composition of the Panel restricted the range of interests represented. Further, the Federal government were criticized for yielding to pressure from insurance lobby groups, culminating in the implementation of the changes based on the Ipp Report recommendations.
The reforms were criticized as being unnecessary, rushed and implemented without sufficient deliberation. There was also a lack of uniformity in the implementation of the recommendations around Australia, contrary to the suggestions of the Panel [2.2]. The lack of uniformity led to substantial variations in the changes to negligence legislation, with New South Wales deviating the furthest from the recommendations.
This has led the Law Council President to claim that the new legislation completely absolves the public authorities of liability. While many have come to share similar views, it is surprising to see Justice Ipp aligning himself with this group. He claims that given the new and powerful defences available to the public authorities, there ceases to be equality before the law. The Law Council spokesman added the changes allow premium collusions while denying victims fair compensation.
The essence of the criticisms is that the reforms were rushed and were self-serving. Critics feel that the implementation of the policy defence exemplifies the criticisms regarding the reforms. However, they have yet to come to a consensus regarding a course of action to rectify the situation.
Advocates
Understandably, the insurance industry has defended the reforms, claiming that the 15% reduction in premiums reported in the Australian Competition and Consumer Commission’s 2005 pricing review are proof that the reforms work.
Allianz Australia announced notable reductions in low quantum claims, while the number of catastrophic claims remains unchanged. This suggests that there are fewer frivolous claims while the seriously injured continue to be supported, dispelling fears of unfair compensations. It is also telling that a number of law firms specialising in personal injury claims have reduced their staff in response to the changes.
Plaintiffs regarded the abolition of the ‘highway rule’ as permission to claim against public authorities, resulting in an exceptionally high number of claims in the wake of the decision. Thus, the reduced number of claims after the changes were implemented is indicative of its validity. Further, cases such as Swain v Waverly Municipal Council show that public authorities still will be held liable for negligence.
While it has been widely accepted that the reforms were a result of the insurance crisis, Stuart Clark presents an alternative view. He believes that the events leading to the reforms started in 1992 with the remodelling of Australia’s tort system to follow the American’s. This led to a culture of ‘blame’ that was recognized in the ministerial meeting on public liability. Thus, Clark argues that the reforms merely restored the integrity of the system.
Advocates believe the reforms have served their purpose in reducing claims and hence, premiums. Moreover, they argue that the reforms served to restore balance to a distorted system. While it is difficult to assess the nature of the impacts the changes will have on the people, advocates believe that the onus is now on the courts to continue developing the law in line with the government’s objectives.
Conclusion
Given the amount of criticism that both the report and the changes implemented have garnered, it might even be seen as fashionable to criticize them. However, the report was commissioned for a purpose and changes made for a reason. While neither can please everyone at the same time, it is not the duty of the law to do so. Rather, the purpose of the law of negligence is to deter and protect against negligently inflicted harm and to allow compensation only to the deserving.
The Ipp Report and the changes implemented served to ensure that the law is kept fair and just. The complexity of the law prevents mutually exclusive changes. However, the considerations and recommendations outlined above suggest adequate contemplation of the ambit of the policy defence and its possible effects. The lack of nationally consistent changes does not render the reforms a failure. Rather, States should always aim to protect the interests of their citizens. The Western Australian legislature should be commended for affirming the recommendations and not granting complete immunity to its public authorities. As such, I believe the changes implemented by the Western Australian legislature were justified and appropriate.
List of References
List Of Legislation Referred To
Civil Liability Act 2002 (WA) Part 1C
Civil Liability Act 2002 (WA) s5X
Civil Liability Act 2002 (NSW) Part 5
List Of Cases Cited
Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1947] 2 All ER 680
Brodie v Singleton Shire Council (2001) 206 CLR 512
Cattanach v Melchior [2003] HCA 38
Hunter Area Health Service and Another v Presland [2005]
Swain v Waverly Municipal Council [2005] 220 CLR 517
List Of Texts And Journal Articles
Allianz Australia, ‘Cautious “thumbs up” for tort reform’ 22 February 2005, Media Release http://allianz.com.au/allianz/MCLN+20050222+Media+Statement.html (27 September 2007)
Australia. Australian Competition and Consumer Commission, Public Liability and Professional Indemnity Insurance: Fifth Price Monitoring Report (Canberra: ACCC, 2005)
Australia. Australian Prudential Regulation Authority, Selected Statistics on the General Insurance Industry 1999-2001 (Sydney: APRA, 2002)
Australia. Minister for Revenue & Assistant Treasurer, Review of the Law of Negligence: Final Report (Canberra: 2002)
Clark, S, ‘Tort reform: a change for the better’ Lawyers Weekly Online, 14 June 2004 http://www.lawyersweekly.com.au/articles/Tort-reform-a-change-for-the-better_z65555.htm (25 September 2007)
Clark, S, & McInnes, R, ‘Unprecedented Reform: The New Tort Law’ (2004) 15 ILJ 99
Davis, R, ‘The Tort Reform Crisis’ (2003) University of New South Wales Law Journal Vol 25 No 3
De Jersey CJ, ‘Personal responsibility must cut both ways’, address to LAWASIAdownunder2005 conference, Queensland 2005
Field, D, ‘The Insurance Crisis – Don’t Forget the Victims’ (2002) Bond University http://epublications.bond.edu.au/law pubs/85 (25 September 2007)
Gibbs, K, ‘Tort Reforms not futile: Insurers’ 22 March 2005 Lawyers Weekly Online http://www.lawyersweekly.com.au/articles/Tort-reforms-not-futile-insurers_z66557.htm (25 September 2007)
Griggs, L, ‘Consumers and the Ipp Report into negligence reform’ (2002) 10 CCLJ 208
Ipp J, The Metamorphosis of Slip and Fall (2007) 29 Aust Bar Rev 150
Law Council of Australia, National Trends in Personal Injury Litigation: Before and After Ipp (Professor E.W. Wright) (Newcastle: Justice Policy Research Centre, 2006)
Law Council of Australia, ‘Public Liability Proposals: Not the Right Solution’ 30 May 2002, Media Release http://www.lawcouncil.asn.au/read/2002/2125395763.html (25 September 2007)
Law Council Australia, ‘Tort Law Reforms Were Unnecessary, According to Law Council Report’, media release regarding the Law Council Report, 31 May 2006 http://www.lawcouncil.asn.au/read/2006/2424209592.html (24 September 2007)
Lindfield, M, ‘The state of tort reform and the law of negligence’ (2003) Thomson’s FindLaw Australia http://www.findlaw.com.au/article/8590.htm (28 September 2007)
Merritt, C, ‘Liability of flawed law reform’ 14 January 2007 The Australian http://www.theaustralian.news.com.au/story/0,20867,21552043-28737,00.html (20 August 2007)
Ralph, E, Soon J & Ergas, H, ‘The Public Liability Insurance Crisis and its Impact on Small and Diverse Organizations’ (2003) NECG
The Assistant Treasurer, Joint Communiqué, Ministerial Meeting on Public Liability 27 March 2002 , Canberra http://www.treasurer.gov.au/atr/content/publications/2002/20020327.asp (25 September 2007)
Turnbull MP, Tort Law Reform - Speech in Parliament on Trade Practices Amendment (Personal Injuries and Death) Bi, 14 September 2005 http://www.malcolmturnbull.com.au/news/article.aspx?ID=310 (22 August 2007)
Wright, A, ‘Liability for Councils’ (2004) 15 ILJ 161
Field, D, ‘The Insurance Crisis – Don’t Forget the Victims’ (2002) Bond University http://epublications.bond.edu.au/law pubs/85 (25 September 2007)
Australia. Australian Prudential Regulation Authority, Selected Statistics on the General Insurance Industry 1999-2001 (Sydney: APRA, 2002)
Ralph, E et al, ‘The Public Liability Insurance Crisis and its Impact on Small and Diverse Organizations’ (2003) NECG
MP Turnbull’s speech in Parliament on Tort Reforms: “there was a wide community perception that the law of negligence as applied in the courts was unclear and unpredictable, that in recent times it had become too easy for plaintiffs in personal injury cases to establish liability for negligence on the part of defendants, and that damages awards in personal injuries cases were frequently too high.” (14 September 2005) http://www.malcolmturnbull.com.au/news/article.aspx?ID=310 (22 August 2007)
The two cases used by MP Turnbull to illustrate the problem: Cattanach v Melchior [2003] HCA 38: A “wrongful birth” case. Public felt that such births are not injuries and thus should not be recoverable. However, the High Court ruled in favour of recovery. Also: Hunter Area Health Service and Another v Presland [2005] NSWCA 33 Presland was admitted to Hunter Area Medical Centre for a psychotic episode. He was discharged early and sent to his brother’s place where he later murdered his brother’s fiancé while suffering from psychosis. Presland sued the hospital for negligence in discharging him and was awarded damages. The resulting public outcry caused the Premier of NSW to appeal. The decision was then overturned by the NSWCA.
The terms of reference specified an objective of limiting liability and quantum of damages arising from personal injury and death [1.7].
The Panel were given 3 months, see Report Date of Ipp Report
See Ipp Report; Terms of Reference
Chapter 10 of the Ipp Report, also Part 1C of CLA (WA)
References in square brackets refer to Ipp Report paragraphs
The immunity, termed the “highway rule” was rejected by the High Court of Australia in Brodie v Singleton Shire Council (2001) 206 CLR 512. It was held that the “highway rule” would no longer be good law and would be replaced by ordinary principles of negligence.
Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1947] 2 All ER 680
Lindfield, M, ‘The state of tort reform and the law of negligence’ (2003) Thomson’s FindLaw Australia http://www.findlaw.com.au/article/8590.htm (28 September 2007)
See Civil Liability Act 2002 (NSW) Part 5
Davis, R, ‘The Tort Reform Crisis’ (2003) University of New South Wales Law Journal Vol 25 No 3
Consumer groups in particular felt there was a complete lack of representation for consumer rights. See Griggs, L, ‘Consumers and the Ipp Report into negligence reform’ (2002) 10 CCLJ 208
“The tort law reforms were hastily-introduced and ill-thought out. They were a knee-jerk reaction to a problem that, according this hard data, had little or nothing to do with litigation rates” Tim Bugg, 31 May 2006, ‘Tort Law Reforms Were Unnecessary, According to Law Council Report’, media release regarding the Law Council Report, Law Council Australia
“Ipp's calls for all states to enact the same tort reforms was ignored. Variations of his recommendations apply around the nation.” Merritt, C, ‘Liability of flawed law reform’ 14 January 2007 The Australian http://www.theaustralian.news.com.au/story/0,20867,21552043-28737,00.html (20 August 2007)
Tim Bugg in ‘Liability of flawed tort reform’ 14 January 2007 The Australian
See for example, Chief Justice Paul de Jersey, ‘Personal responsibility must cut both ways’, address to LAWASIAdownunder2005 conference, Queensland 2005
Justice David Ipp, The Metamorphosis of Slip and Fall (2007) 29 Aust Bar Rev 150
Law Council of Australia, ‘Public Liability Proposals: Not the Right Solution’ 30 May 2002, Media Release http://www.lawcouncil.asn.au/read/2002/2125395763.html (25 September 2007)
Proposals have included commissioning a new report to simply having more detailed discussions of the changes.
Australia. Australian Competition and Consumer Commission, Public Liability and Professional Indemnity Insurance: Fifth Price Monitoring Report (Canberra: ACCC, 2005)
Gibbs, K, ‘Tort Reforms not futile: Insurers’ 22 March 2005 Lawyers Weekly Online http://www.lawyersweekly.com.au/articles/Tort-reforms-not-futile-insurers_z66557.htm (25 September 2007)
Allianz Australia, ‘Cautious “thumbs up” for tort reform’ 22 February 2005, Media Release http://allianz.com.au/allianz/MCLN+20050222+Media+Statement.html (27 September 2007)
Clark, S, & McInnes, R, ‘Unprecedented Reform: The New Tort Law’ (2004) 15 ILJ 99
Wright, A, ‘Liability for Councils’ (2004) 15 ILJ 161
Law Council of Australia, National Trends in Personal Injury Litigation: Before and After Ipp (Professor E.W. Wright) (Newcastle: Justice Policy Research Centre, 2006)
[2005] 220 CLR 517. Held that Council should have exercised reasonable care to prevent injury to users.
He is a litigation and dispute resolution partner with Clayton Utz and is based in Sydney
See his article, ‘Tort reform: a change for the better’ Lawyers Weekly Online, 14 June 2004 http://www.lawyersweekly.com.au/articles/Tort-reform-a-change-for-the-better_z65555.htm (25 September 2007)
The Assistant Treasurer, Joint Communiqué, Ministerial Meeting on Public Liability 27 March 2002, Canberra http://www.treasurer.gov.au/atr/content/publications/2002/20020327.asp (25 September 2007)
Clark opines: “The reforms that have been brought about over the past 12 months, particularly those that have followed the recommendations of the Ipp inquiry, do no more than restore a little balance to the process.”