The NSW Government’s second tranche of tort law reform was tabled in the State Parliament last week. The Civil Liability Amendment (Personal Responsibility) Bill 2002 has been extensively rewritten to incorporate recommendations from the Ipp Review.

Andrew Morrison, a partner at Clayton Utz, said the “unsatisfactory” test of foreseeability in the exposure draft has been replaced with one based on the Ipp Review’s recommendations.

Another significant addition to the Bill is a new division dealing with causation. In determining whether a negligent act caused the particular harm, the court must now not only find that the negligence was a necessary condition of the harm occurring, but also that it is appropriate to extend the scope of the defendant’s liability to the harm suffered by the plaintiff. 

“Courts will be required to address questions of liability in a clearer fashion… and to consider matters including the commercial setting of the alleged negligence and the practical effects of a finding of liability upon ordinary commercial activity,” Mr Morrison said.

The definition of “obvious risk” in the exposure draft has been brought into line with the Ipp Review’s definition, and now also reflects the division made by the review between the proactive and reactive duty to warn. But unlike the Ipp recommendation, the NSW Bill expresses these as general duties, not simply as duties of medical practitioners. “As a result, providers of professional services will need to look carefully both at the dangers which might fall within the scope of ‘obvious risk’ and also at their responsiveness to clients’ inquiries,” Mr Morrison said.

The NSW Bill provides that all professionals – not just medical practitioners – will not be liable in negligence if they act in a manner widely accepted by peer professional opinion as competent professional practice. 

And joint and several liability will be replaced by proportionate liability in claims for economic loss or damage to property – a move that Mr Morrison said “will help in risk management”.

ICA Executive Director Alan Mason said the changes will help mitigate rising claims costs. “While [their] effectiveness will ultimately depend on how they are interpreted by the judiciary, ICA believes that protection against liability for obvious risk in particular should have a significant impact on public liability claims.”

Mr Mason said it is “crucial” for the Commonwealth Government to respond to Justice Ipp’s recommendation that the Trade Practices Act be amended to prevent claimants “forum shopping” for alternative means of litigation.