Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Law Commission sticks with joint and several liability

Law Commission sticks with joint and several liability

The Law Commission is strongly of the view that New Zealand should retain joint and several liability but has suggested some changes to make the system fairer for both sides.

The options
The big question for the Law Commission was whether to retain joint and several liability or recommend that New Zealand move to a system of proportionate liability.

Joint and several liability
...works from the principle that all parties who contributed to a loss are each liable for the full amount of the damages awarded. The effect of this is that, if one party is insolvent or for any other reason unavailable to pay, the others may have to front up with the difference in order that the plaintiff can recover in full.

Proportionate liability
...is used in a number of jurisdictions, including Australia. Under this rule, each liable defendant is apportioned a share of the total liability based on the court's assessment of their share of the responsibility or fault. No-one can be made to pay more than their share, meaning that the plaintiff carries the risk that there may be a missing liable party.

Recommendations
The Commission found that joint and several liability was "clearly the preferable system" but has recommended a number of adjustments to deliver fairer outcomes. Key among these are:

• giving the courts power to make orders that would mitigate the full application of joint and several liability where this would create a "clear injustice" to defendants who have only a minor responsibility. In such situations, the court would be expected to ensure that the plaintiff still receives an "effective remedy"

• changing the rules of contribution so that the costs of an uncollected share can be spread proportionately among the remaining solvent and liable defendants (currently a defendant which has been required to pay losses in excess of its share can chase up the others but they cannot be required to pay more than their allocated contribution)

• introducing liability caps for building consent authorities for new liabilities after the leaky home claims have been dealt with

• introducing to New Zealand a version of the capped liability schemes for auditors applying in almost all of the Australian States. It is anticipated that the capped scheme would apply only where a very large audit firm was exposed to a catastrophic loss.

Where now?
The Government has undertaken to respond to the recommendations early next year.

ends

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Statistics: Dairy And Travel Still Our Largest Export Earners

New Zealand earned $2.3 billion more from exports than we spent on imports during the year ended June 2015... total exports of goods and services were $67.5 billion, while total imports were $65.1 billion. More>>

ALSO:

Approval: Air New Zealand And Air China Launch New Alliance Route

Air New Zealand and Air China have today launched joint sales for a new daily direct service between Auckland and Beijing after receiving approval from New Zealand Minister of Transport Hon Simon Bridges to form a strategic alliance. More>>

ALSO:

Money Trading: FX Trader Jin Yuan Finance Warned Over Lack Of Monitoring

Jin Yuan Finance, an Auckland-based foreign exchange trader, has been warned over its lack of anti-money laundering processes in place in the first public notification by the Department of Internal Affairs. More>>

ALSO:

Auckland Surge, Possible Peak: House Values Accelerate At Fastest Annual Pace In 8 Years

New Zealand residential property values rose at their fastest annual pace in eight years in August, pushed higher by overflowing demand in Auckland, which is showing signs speculators think it has reached its peak, according to Quotable Value. More>>

ALSO:

Cash Money: Reserve Bank Launches New $5 And $10 Banknotes

The $5 and $10 final banknotes were revealed at an event at the Bank in Wellington, and will start to be released from mid-October 2015. More>>

ALSO:

Truck Sales Booted: Commerce Commission Files Charges Against Mobile Trader

The Commerce Commission has filed charges against a mobile trader, or truck shop operator, claiming he obtained money from customers by deception and never intended to supply them with the goods they paid for. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news