Australia: Victorian parliament makes changes to the Wrongs Act

In brief - Amendments aim for fair and consistent operation of personal injury legislation

The Victorian Parliament recently passed the Wrongs Amendment Act 2015 (Vic) ("Amending Act") which makes several important changes to Victoria's personal injury legislation. The amendments to the Wrongs Act 1958 (Vic) are based on five recommendations given by the Victorian Competition and Efficiency Commission (VCEC). They are significant in that they either allow for increased awards of damages or for damages to be awarded in circumstances where they were previously unavailable.

VCEC addresses concerns about personal injury legislation limitations

Following on from our September 2014 article entitled Victorian inquiry into Wrongs Act 1958 - VCEC recommendations and government's response, the Victorian parliament has now passed an Act amending aspects of the Wrongs Act.

The amendments are the result of a 2014 report by the VCEC entitled Adjusting the Balance: Inquiry into Aspects of the Wrongs Act 1958. In its report, the VCEC raised a number of concerns about the limitations that were implemented into Victoria's personal injury legislation in the early 2000s to improve the availability of professional indemnity and public liability insurance.

The Amending Act implements five of the VCEC's recommended changes to the Wrongs Act which are outlined below.

Calculation method for maximum damages in cases of economic loss to change

The Amending Act amends section 28F(2) of the Act which prescribes the maximum damages for past or future loss of earnings. The Act currently requires the court to "disregard the amount by which the claimant's gross weekly earnings would (but for the death or injury) have exceeded an amount that is 3 times the amount of average weekly earnings at the date of the award."

The VCEC report raised concerns that this cap was unfair to the dependants of high income earners who also had high living expenses. In a dependency claim for loss of financial support, the cap may be applied prior to the deceased's living expenses being deducted.

It also suggested that high income earners may be unfairly disadvantaged because if their post-injury earnings remained higher than the cap, they may not be entitled to any damages, even if their income was significantly reduced by the injury.

The Amending Act changes the wording of section 28F(2) so that damages are capped "for each week of the period of loss of earnings" at "an amount that is 3 times the amount of average weekly earnings at the date of the award". Under the new wording, it is intended that claimants with different earning capacities will be treated more evenly because the court will not be required to consider the claimant's income. Additionally, the new section aims to clarify that deductions for a deceased's living expenses should take place prior to the application of the cap.

Maximum damages for non-economic loss to be increased

Sections 28G and 28H of the Act limit the maximum amount of damages that may be awarded to a claimant for non-economic loss. The maximum listed in section 28G of $371,380 is indexed annually in accordance with the CPI calculation in section 28H. The indexed maximum currently sits at approximately $520,000. The Amending Act increases the amount in section 28G to $577,050, which will also be indexed annually.

The VCEC report noted that this latter amount was the limit on damages for pain and suffering in the Workplace Injury Rehabilitation and Compensation Act 2013 (Vic) and that there was no reason for a different cap to apply to workplace and personal injuries.

Damages for loss of capacity to care for others now allowed

The Amending Act also amends section 28ID of the Act to provide a new statutory entitlement to damages for the loss of a claimant's capacity to provide gratuitous care to the claimant's dependants. Alongside this, the definition of "dependants" has been expanded to include any unborn children at the time that liability arises.

The purpose of this section is to encompass the recommendation of the VCEC to enact a section to apply despite contrary common law, most notably CSR v Eddy (2005) 226 CLR 1. In that case, the High Court held that where a plaintiff is prevented by an injury from providing gratuitous services to another, the damages recoverable cannot include an amount calculated by reference to the commercial value of the services, and the loss of capacity to care for another (in this case, a man's wife) should be dealt with under general damages. This amendment will overrule this concept and provide a specific head for such a type of damage.

Restrictions remain for the type of "dependant" covered under this section. The court must be satisfied that the claimant provided care to the dependants before liability arose, that the dependants were or will not be able to provide care for themselves due to age or physical or mental incapacity, and that, but for the injury, the claimant would have been provided for at least six hours and for a period of six consecutive months.

Threshold impairment level for non-economic loss in certain cases decreased

The Amending Act also changes the definition of "threshold level" in section 28LB of the Act. Currently, damages for non-economic loss can only be awarded for psychiatric injury where the claimant's impairment is assessed as being greater than 10%. However, the Amending Act sets the required impairment level at "10 per cent or more".

Additionally, the Amending Act creates a specific category for spinal injuries, setting the threshold impairment level at "5 per cent or more". Currently, spinal injuries are treated the same as any other physical injury and an impairment level of more than 5 per cent is required before damages for non-economic loss can be awarded.

In both cases, the Amending Act allows for claimants on the edge of the threshold level to recover damages for non-economic loss where they were not previously entitled to do so.

Courts can stay proceedings in claims for damages for non-economic loss where certificate of assessment not served

The Amending Act inserts a new section 28LZMA, which gives the court power to stay proceedings in respect of a claim for recovery of non-economic loss until the claimant has served on the respondent the certificate of assessment and any other information prescribed under Part VBA to accompany the certificate.

Transitional provisions introduced for the new threshold level

The Amending Act introduces important transitional provisions in relation to the new "threshold level" which will give retrospective effect to the provisions. Section 28LZS(1) provides that the new definition will apply to an injury subject to a claim "irrespective of when the act or omission causing the injury and giving rise to the claim for recovery of damages occurred." Further, section 28LZS(2) states that it will also apply to a claim that "commenced before the commencement of section 11 of (the) Act but has not been finally settled or determined before the commencement of that section".

Amendments intend to lead to better or fairer outcomes for claimants, but are they necessary?

It is significant that the amendments either allow for increased awards of damages or for damages to be awarded in circumstances where they were previously unavailable. The "second reading speech" notes that the amendments are aimed at ensuring that Victoria's personal injury legislation operates fairly and consistently, leading to better or fairer outcomes for claimants. In circumstances where damages settlements and awards for personal injury claims in Victoria appear to be growing in size and are disproportionate to those in other states and territories in Australia, the need for the amendments is questionable.

Rose Raniolo
Health and medical
Colin Biggers & Paisley

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.