Source: https://iclg.com/practice-areas/product-liability/product-liability-2016/australia
Timestamp: 2017-04-26 07:57:49
Document Index: 574977895

Matched Legal Cases: ['art 3', 'art 3', 'art 3', 'art 5', 'art 3', 'arts 3', 'art 3', 'arts 2', 'art 5']

Product Liability 2016 | Laws and Regulations | Australia | ICLG
Home Practice area Product Liability Product Liability 2016 Australia
Australia’s product liability laws are a mixture of the common law and legislation.
A person who claims to have been injured or who has otherwise suffered loss or damage may commence an action for compensation on the following bases:
breach of provisions of the Australian Consumer Law (“ACL”). The ACL is a new federal law which came into effect on 1 January 2011. It applies to transactions occurring on or after that date. The ACL replaces a collection of federal (also known as Commonwealth) and state consumer protection legislation with a single law which applies in all jurisdictions. The ACL is found in Schedule 2 to the Competition and Consumer Act 2010 (Cth) ("CCA"), which is itself the renamed Trade Practices Act 1974 ("TPA"). The consumer protection regime formerly found in the TPA has been transferred to the ACL and, in doing so, has been substantially modified.
The ACL imposes statutory obligations including a strict liability regime for products which are said to have a "safety defect" and statutory guarantees imposed on manufacturers. State fair trading legislation exists to provide for the application of the ACL in each of the states and territories, as well as covering some additional areas such as industry-specific regulation.
Typically, product liability claims for damage to persons will involve causes of action based on negligence and breaches of various provisions of the ACL.
No formal schemes for particular products exist, except for asbestos-related claims. In New South Wales, the Dust Diseases Tribunal has exclusive jurisdiction to determine “dust diseases” claims. Similarly in South Australia, the District Court has exclusive jurisdiction to hear such matters.
There are also state-based schemes requiring compulsory insurance in respect of motor vehicle accidents. As a result, personal injury claims arising from motor vehicle accidents have, to date, generally been brought under these statutory schemes, as opposed to being brought against motor vehicle manufacturers.
Liability for fault or defect depends upon the particular facts and cause of action relied upon.
It is generally accepted that the manufacturer of goods owes a duty of care to the purchaser and user to safeguard them against the foreseeable risks of injury when using the product as intended.
Retailers, importers and distributors are not expected to test or inspect products which the manufacturer delivers in sealed containers which would not normally be opened until they reach the ultimate consumer. However, in these circumstances, the retailer still has a duty to guard against those dangers known to it or which it has reasonable grounds to expect.
To the extent that any party in the supply chain adds to or modifies a product including packaging and labelling, that party will also owe a common law duty to the purchaser and user in respect of those changes.
Parties are free to enter into contracts on terms agreed between them, subject to terms implied into the contract by common law or statute.
Contractual remedies are only available to parties to the contract. Since, in most circumstances, it is the retailer that will have a contractual relationship with the purchaser, the retailer will bear the liability for any defect or fault in accordance with the express and implied terms of the contract of sale. However, this does not prevent a retailer from consequently seeking contractual remedies from other parties.
The importance of contract as a cause of action in product liability claims has diminished in recent times as a result of the growth of the law of negligence and the statutory causes of action. The ACL has affected the relationship between contract and product liability by introducing provisions which render void any unfair term in a standard form contract, and it creates "statutory guarantees" which exist independently of any contract of supply (see further below).
Statutory Warranties and Guarantees
Under Part 3-2 of the ACL, manufacturers are liable directly to consumers for:
goods which do not correspond with their description;
goods of unacceptable quality;
goods which do not conform to sample;
goods unfit for a stated purpose; and
non-compliance with express warranties.
Privity of contract is no barrier to relief.
The operation of these statutory warranties and guarantees is restricted to claims of consumers who have suffered loss or damage as a result of their use or consumption of consumer goods. These are goods that are ordinarily acquired for personal, domestic or household use or consumption.
Under the ACL, manufacturers will be held strictly liable directly to consumers for injury to persons or property damage suffered as a result of a defective product. Goods are considered to be defective if their safety is not such as persons generally are entitled to expect.
Under the ACL, the definition of “manufacturer” is extremely broad and potentially includes anyone in the supply chain.
The issues that will be considered in deciding whether recall action is necessary include the:
magnitude of the potential harm involved;
probability of such harm occurring;
availability and effectiveness of alternative remedial action; and
degree of knowledge in potential users of the potential harm.
In addition, the product safety provisions of Part 3-3 of the ACL contain a stringent regime for the compulsory recall of goods which:
do not comply with a prescribed safety standard;
have been declared to be unsafe goods or permanently banned; or
will or may cause injury to any person.
Yes. Certain conduct by corporations and their officers may be subject to criminal sanctions under the ACL.
The statutory consumer guarantees and the defective product causes of action under the ACL are often referred to as “strict liability” provisions. For actions for breach of a consumer guarantee, a claimant need not prove fault, but nonetheless must establish, on balance that, for example, the subject goods are not fit for purpose or are not of acceptable quality in the circumstances. For a defective goods action, a claimant needs to prove that the subject goods have a safety defect, i.e. are not as safe as persons are generally entitled to expect (having regard to all relevant circumstances).
At common law, in contract and in other actions based on the provisions of the ACL, the claimant must establish:
that the relevant conduct is either in breach of a common law duty, in breach of the contract or contravenes one of the provisions of the ACL; and
that the loss or damage was caused by the defendant's conduct.
2.2 What test is applied for proof of causation? Is it enough for the claimant to show that the defendant wrongly exposed the claimant to an increased risk of a type of injury known to be associated with the product, even if it cannot be proved by the claimant that the injury would not have arisen without such exposure? Is it necessary to prove that the product to which the claimant was exposed has actually malfunctioned and caused injury, or is it sufficient that all the products or the batch to which the claimant was exposed carry an increased, but unpredictable, risk of malfunction? The test for causation depends upon the cause of action relied upon.
Prior to reforms to the law of negligence which occurred in 2002 (the Tort Reform Process), the position at common law was that causation was a question of fact to be decided according to evidence before the court. Australian courts applied a "common sense" test to determine the question of causation.
Following the Tort Reform Process, while the test varies between jurisdictions, there are basically two requirements for causation in negligence:
first, that the negligence was a necessary condition of the occurrence of the harm (referred to as "factual causation"); and
second, that it is appropriate for the scope of the negligent person's liability to extend to the harm so caused (referred to as “the scope of liability”).
There is, however, an allowance for determining in an "exceptional" case, whether negligence that cannot be established as a necessary condition of the occurrence of harm should nonetheless be accepted as establishing factual causation.
Defective goods actions under Part 3-5 of the ACL may arise where a person has suffered loss or damage because of a safety defect. A person may be able to recover damages for loss or damage suffered where it is reasonably foreseeable that the consumer would suffer such loss or damage as a result of the failure to comply with a consumer guarantee (Part 5-4 of the ACL).
While there are some who argue otherwise, Australian courts have not embraced the view that a plaintiff proves causation or reverses the onus of proof in relation to causation by demonstrating that the exposure they were subject to simply increased the probability of their injury occurring.
Under the common law, the claimant must establish the identity of the manufacturer that was responsible for the relevant defect. The sole exception to this is where a claimant is able to rely on the maxim res ipsa loquitur (when the negligence speaks for itself) when they cannot provide evidence as to why or how the occurrence took place. Under this doctrine, a rebuttable inference of negligence may be drawn against the defendant by the mere fact that it would not have happened without negligence.
Conversely, the ACL contains deeming provisions that assist claimants in circumstances where it is not clear who actually manufactured the defective product.
Under the ACL, the definition of “manufacturer” is very broad and can potentially include anyone in the supply chain, particularly when the actual manufacturer is outside Australia.
In relation to the defective/unsafe product cause of action, a claimant is entitled to make a written request to the supplier for information about the manufacturer. If, after 30 days, neither the claimant nor the supplier knows the identity of the manufacturer, the supplier is deemed to be the manufacturer.
Whilst no generally established system of market-share liability exists in Australia, as a result of the Tort Reform Process, most jurisdictions have introduced proportionate liability for co-defendants in respect of non-personal injury claims for economic loss or property damage, or claims for misleading or deceptive conduct brought pursuant to state fair trading legislation. In such cases, each co-defendant will only be liable to the extent of its responsibility.
In personal injury claims, defendants may still rely on a statutory right to seek contribution from any or all other parties that would have been held liable for the same damage had they been a party to the proceedings.
The common law of negligence imposes a duty of care on the manufacturer of a product to take reasonable steps to ensure that ultimate users of that product are given adequate warnings of foreseeable risks associated with its use to enable users to adjust their use of the product so as to avoid or minimise danger or to make an informed decision about whether or not to use the product.
A failure to warn may also found a claim that a product has a safety defect, is unfit for its purpose or is of unacceptable quality under the ACL. In deciding whether the product has a safety defect, is unfit for its purpose or is of unacceptable quality, the court may look at all relevant circumstances, including any warnings and the marketing strategy adopted by the manufacturer or supplier to determine whether they placed the user in a position to properly understand the risks associated with the product.
Australian courts have, to date, declined to apply the learned intermediary doctrine. However, for medical products which may only be accessed through a doctor, the doctrine is consistent with Australian law which acknowledges the importance of the relationship between doctor and patient in the provision of warnings about medical treatment.
Following the Tort Reform Process, in some jurisdictions, evidence from plaintiffs as to what they would have done had there been a warning about a risk of injury is now inadmissible in negligence cases except to the extent that it is evidence against the plaintiffs' interest.
Limitation periods apply to all causes of action pleaded in product liability litigation. Details of limitation defences are set out in question 5.2 below.
The following defences may be available to a claim in negligence:
volenti non fit injuria (voluntary assumption of risk);
the learned intermediary defence.
Voluntary assumption of risk is a deliberate decision by the plaintiff to assume the risk of injury, loss or damage. To establish the defence of volenti, the defendant must show that the plaintiff not only perceived the existence of the danger, but also fully appreciated it and voluntarily accepted the risk. This defence is difficult to establish, but is a complete answer to any claim.
Contributory negligence may be relied on where the plaintiff's conduct fails to meet the standard of care required for his or her own protection and safety, and is a contributing cause in bringing about his or her injury. Damages are apportioned by the court in accordance with each party's degree of fault. In certain jurisdictions, contributory negligence can be a complete defence to an action if the court thinks it is just and equitable in the circumstances.
There is no express authority in Australia for a learned intermediary defence, although there is no reason why the defence cannot be accommodated within existing common law principles.
The Tort Reform Process has created new statutory defences to an action for negligence, although these differ from jurisdiction to jurisdiction.
For example, the following have been introduced as complete defences in New South Wales:
where the harm was suffered as a result of the materialisation of an inherent risk, which is defined as the risk of something occurring that cannot be avoided by the exercise of reasonable care and skill;
where the harm was suffered as a result of the materialisation of an obvious risk associated with a dangerous recreational activity. An obvious risk is a risk that, in the circumstances, would have been obvious to a reasonable person in the position of the plaintiff and includes risks that are patent or a matter of common knowledge;
where a professional defendant acted in a manner that, at the time the relevant service was provided, was widely accepted in Australia by peer professional opinion as competent professional practice (unless the court considers such opinion to be irrational);
where the defendant is a good Samaritan or volunteer and has exercised reasonable skill and care under the circumstances; and
in certain cases where the defendant is a public or other authority.
Part 3-5 Australian Consumer Law
the goods were defective only because there was compliance with a mandatory standard (see further, question 3.3);
the state of scientific or technical knowledge at the time the goods were supplied was not such as to enable the defect to be discovered (the so-called 'development risk' or 'state of the art' defence) (see further, question 3.2); or
Under the statutory guarantee provisions of the ACL, the issue would be whether the product was fit for the purpose for which it was intended, giving consideration to any description applied to the goods by the corporation, the price received by the corporation for the goods, and all the other circumstances.
In negligence, the claimant must establish that the manufacturer failed to exercise reasonable care. The state of scientific and technical knowledge is often pertinent to this issue and forms the basis of the manufacturer’s defence.
Under the defective goods action provisions of the ACL, it is a defence that the goods had the defect only because there was compliance with a mandatory standard. A mandatory standard is a standard for the goods or anything relating to the goods which, under law, must be complied with when goods are supplied, and which carries a penalty for non-compliance. A standard which simply requires a minimum standard to be achieved is not a mandatory standard.
Claimants may re-litigate these issues. This is not possible in cases where the issue has already been determined in a representative proceeding (class action) in the Federal Court of Australia where the claimant is bound by a ruling made in that class action by virtue of their failure to “opt out” of the proceeding. There are also special rules in dust disease cases litigated in the New South Wales Dust Diseases Tribunal.
Yes. Defendants are permitted to rely on a statutory right to contribution from other concurrent tortfeasors (whether joint or several). Alternatively, defendants may seek to rely on a contractual right of indemnity. These remedies may be pursued either in the same or subsequent proceedings. If subsequent proceedings are required, time limits do apply. These differ between jurisdictions and depend on the cause of action.
Following the Tort Reform Process, all Australian state and territory jurisdictions enacted a statutory regime of proportionate liability for non-personal injury claims for damages. The liability of a defendant who is a concurrent wrongdoer is now limited to an amount reflecting the proportion of the damage the court considers just having regard to the extent of that defendant's responsibility.
Certain state jurisdictions allow parties to expressly contract out of the proportionate liability scheme.
Under the common law and certain legislation, if the defendant can demonstrate the plaintiff contributed to the damage by failing to take reasonable care, damages will be apportioned by reference to the plaintiff's share in the responsibility for that damage. The regime expressly covers personal injury and loss of life.
Courts in several jurisdictions may appoint a “court expert” to inquire and report on a question of fact arising in a matter before the court or an "expert assistant" to assist the court on any issue of fact or opinion identified by the court (other than an issue involving a question of law) in the proceeding, should the need arise.
An expert is generally accepted to be a person who has specialised knowledge about matters relevant to the question based on that person’s training, study or experience.
The role of court experts or expert assistants is advisory in nature and does not extend to sitting with the judge and assessing evidence presented by the parties.
In most jurisdictions, the parties are joint and severally liable for payment of the expert's fees.
There is a detailed class action procedure in the Federal Court of Australia and the Supreme Courts of Victoria and New South Wales. There are also representative action procedures in other State jurisdictions. An action can only be commenced in the Federal Court where it attracts federal jurisdiction, for example, if it involves a claim under the ACL under federal legislation.
Class actions have involved products including weight loss drugs, heart pacemakers, aircraft fuel, gas, water, tobacco and a variety of food stuffs ranging from oysters to peanut butter. Australia is now the most likely jurisdiction outside North America where a corporation will face a class action.
Federal and Victorian legislation provides for the commencement of a class action where seven or more persons have a claim against the same person and the claims are in respect of, or arise out of, the same, similar or related circumstances, and give rise to a substantial common issue of law or fact.
If these threshold requirements are met, any of those persons may commence an action on behalf of the group. There is no certification process as occurs in the United States. The representative plaintiff must describe the group, but need not identify, name, or specify the number of group members. With limited exceptions, a person's consent to be a group member is not required.
Once proceedings have been commenced, the court will fix a date by which a group member may opt out by written notice to the court, and will give directions regarding the procedure for notifying potential group members of the existence of the proceedings. Unless a person actively opts out of the proceedings, they will continue to be a part of the action and be bound by its outcome.
In order to protect absent group members, the action may not be settled or discontinued without the approval of the court. Similarly, the representative plaintiff may only withdraw from the proceedings or settle his or her individual claim with the leave of the court.
Yes. The ACL expressly provides for the institution of proceedings by the Australian Competition and Consumer Commission (“ACCC”) on behalf of those who have suffered or are likely to suffer loss as a result of contraventions of the ACL, including certain provisions of Parts 3-5 (defective goods actions) and 5-4 (remedies relating to guarantees). Under these provisions, the ACCC requires the prior written consent of the persons on whose behalf the application is being made.
Time to trial depends on the particular jurisdiction and the nature of the claim. It may take anywhere from six months to several years for a matter to be heard and determined.
Proceedings in the Federal Court are usually heard faster than those in the state and territory supreme courts, due in part to the Federal Court's case management system, whereby each proceeding is allocated to a particular judge who manages the case and usually hears and determines it, and the supreme courts’ heavier case load.
There are provisions in all jurisdictions for expedited hearings in appropriate circumstances, including the ill health of a litigant.
In some jurisdictions, the court may try preliminary issues whether of fact or law or mixed fact and law.
Historically, courts have been of the view that trials of preliminary issues should only be granted on special grounds, such as whether the preliminary issue will substantially narrow the field of controversy, shorten the trial and/or result in a significant saving in time or money.
Preliminary issues are usually heard and determined by a judge.
In virtually all jurisdictions, there is a right of appeal from the judgment of a trial judge. The procedure varies depending on the jurisdiction in which the original trial was conducted. Leave to appeal is usually necessary when the appeal is from an interlocutory judgment. Even though appeals generally turn on questions of law, it is not uncommon for parts of the evidence used at trial to be reviewed during the course of an appeal.
A party dissatisfied with the decision of a state or territory Court of Appeal or the Full Federal Court may seek leave to appeal to the High Court of Australia, the country’s ultimate appellate court. Appeals to the High Court are essentially restricted to questions of law. The High Court will only grant leave to appeal if it is convinced that there is a significant question to be determined.
See question 4.2. Where the court has appointed an expert in relation to a question arising in the proceedings, the rules provide that the court may limit the number of other experts whose evidence may be adduced on that question, or that a party must obtain leave to adduce such evidence.
Court experts are rarely appointed. However, as a matter of course, parties adduce evidence from appropriate experts.
The nature and extent of expert evidence is subject to the discretion of the court. In a number of jurisdictions, practice notes provide guidance on the number of experts that might be called by any party in a particular area of expertise. In addition, the court may require the experts instructed by opposing parties to meet before giving evidence in court, to narrow the issues in dispute.
Depositions of the parties and witnesses are not taken before trial. However, the Australian legal system is more onerous in terms of the obligations imposed on parties to give discovery of documents (see question 4.10).
In some jurisdictions, most notably the Federal Court of Australia, pre-trial directions are made in the ordinary course that witness statements and expert reports be exchanged before hearing and that those statements and reports comprise the evidence in chief of those witnesses.
It is also common for directions to be made requiring the parties to exchange objections to their opponent’s statements and reports before trial. Any objections that are not conceded or otherwise addressed are then argued, and ruled upon, before cross-examination of the witnesses at trial.
A party is obliged to discover − that is, to identify and allow the other parties to access − all documents in its possession, custody or power which are relevant to a matter in issue in the proceedings. Discovery occurs at the pre-trial stage so that all documents relevant to the case are disclosed by the parties before the hearing commences.
The obligation to give discovery extends to documents which are no longer in the party’s possession, custody or power, but which were previously. This may occur where a relevant document has been lost, destroyed or provided to someone else. In such a case, a description of the document must be provided to the other parties.
Documents that are relevant to a case include those documents on which the party relies, documents that adversely affect the party’s own case, documents that adversely affect another party’s case, documents that support another party’s case, and documents that the party is required by a relevant practice direction to disclose.
All discovered documents must be listed, and the parties’ lists sworn and exchanged. Parties are entitled to inspect each others’ documents and, if desired, copy them, save for those in relation to which a claim for privilege has been advanced.
Preliminary discovery before the substantive proceedings assists parties in identifying prospective defendants, to determine whether or not they have a claim or to gain information from third parties where any party to a proceeding reasonably believes that a particular party holds a document which relates to any question in the proceeding.
The obligation to discover all relevant documents continues throughout the proceedings. This means that any document created or found after providing initial discovery must also be discovered.
Alternative methods of dispute resolution ("ADR") such as mediation, arbitration and conciliation are available in Australia. There is now an emphasis on ADR, particularly mediation, enshrined in various court procedures.
There are also legislative provisions which expressly encourage parties to explore resolution of disputes before the commencement of some proceedings.
The CCA (including the ACL) regulates the conduct of corporations, including foreign corporations carrying on business in Australia, and trading and financial corporations formed in Australia. The application of the ACL also extends to certain conduct (of both individuals and corporations): which is engaged outside Australia; or involves the use of postal, telegraphic or telephonic services, radio or television broadcasts (sections 4 to 6 of the CCA).
Whether an Australian court has jurisdiction in a product liability matter depends on whether the defendant can be validly served with initiating process. The Service and Execution of Process Act 1992 (Cth) makes specific provision for the valid service of an originating process (e.g. Statement of Claim) on a defendant to proceedings which is a foreign defendant. Ordinarily, a foreign defendant submits to the Australian jurisdiction when it commences proceedings as a plaintiff, enters an appearance as a defendant to proceedings, or agrees with a plaintiff that it will so submit to the jurisdiction.
If a foreign defendant refuses to submit to the jurisdiction, there may be an argument about the proper forum for hearing of a claim. The choice of laws dictate that the appropriate law for a tortious action is, generally speaking, the law of the place where the wrong occurred.
Yes, time limits do exist under common law and statute.
There are considerable variations between the limitation periods applicable to common law proceedings in the various Australian states and territories, resulting from a profusion of specialist legislation and court decisions, although the Tort Reform Process has resulted in more uniformity in relation to the limitation period applicable to personal injury actions.
In general terms, limitation periods are routinely defined by reference to the nature of the cause of action, including whether the claimant alleges fault-based or strict liability. In most jurisdictions, the limitation period applicable to claims for personal injury is either:
the earlier of three years from the date the cause of action is discoverable by the plaintiff ("the date of discoverability") or twelve years from the date of the alleged act or omission (the "long-stop period"); or
Limitation periods including those applicable to personal injury claims are usually suspended while a claimant is suffering from a legal incapacity, which encompasses the period prior to a claimant turning 18, or during which a claimant suffers from a mental or physical disability which impedes them from properly managing their affairs.
Defective goods actions brought under Part 3-5 of the ACL must generally be commenced within three years after the time the person becomes aware, or ought reasonably to have become aware, of particular circumstances giving rise to the action. There is also a ten-year period of repose, which requires actions to be commenced within ten years of the supply by the manufacturer of the goods.
For personal injury claims that relate to Parts 2-2, 3-3, 3-4, 3-5 or Division 2 of Part 5-4 of the ACL, the applicable limitation period is the later of the "date of discoverability" or the "long-stop period" as defined above (section 87F of the CCA and Part VIB of the CCA more generally).
Most Australian jurisdictions provide for the postponement of commencement of the limitation period where the plaintiff's right of action or the identity of the person against whom a cause of action lies is fraudulently concealed. The limitation period is deemed to have commenced from the time the fraud was discovered or the time that a plaintiff exercising reasonable diligence would have discovered. Throughout all Australian jurisdictions, the courts have various discretionary bases for extending the time period where it is just and reasonable.
Monetary compensation is available for both pecuniary and non-pecuniary loss. In addition, courts may grant injunctions, including interim injunctions, to restrain breaches or attempted breaches of the restrictive trade practices and consumer protection provisions. The potential breadth of remedies available is illustrated by sections 237 and 238 of the ACL where a court has power to make such orders as it thinks appropriate against a person who was involved in the contravention of the consumer protection provisions of the ACL.
The following damages are available for claims of bodily injury:
general damages, including pain and suffering, loss of amenities and loss of expectation of life; and
special damages, including loss of wages (both past and future), medical and hospital expenses and the like.
The Tort Reform Process has resulted in caps, thresholds and other limitations being placed on the amount of such damages that can be recovered.
Damages are assessed on a once and for all basis.
Damages are also recoverable for mental damage, provided it can be established that the claimant is suffering from a diagnosed psychiatric condition. In addition, common law damages are available for damage to the product itself, or other consequential damage to property. One can recover damages for "pure economic loss" but the nature and extent of such damages is extremely complex.
Part VIB of the CCA
Under Part VIB of the CCA, damages are recoverable for losses suffered as a result of personal injuries, including medical expenses (subject to similar caps, thresholds and other limitations imposed on common law damages following the Tort Reform Process). A person other than an injured party may also claim compensation where that person suffers loss as a result of the other person's injury or death, for losses relating to personal, domestic or household goods other than the defective goods, and losses relating to private land, buildings and fixtures.
As a general rule, damages for the costs of medical monitoring in the absence of any established injury or loss are not recoverable.
Exemplary, punitive or aggravated damages can be awarded by the courts, although not in relation to claims brought under the ACL and, in some jurisdictions (as a result of the Tort Reform Process), not in negligence actions seeking damages for personal injury.
Generally, no. However, the Tort Reform Process has resulted in caps, thresholds and other limitations being placed on the amount of damages a personal injury claimant can recover.
Court approval is required for the settlement of representative proceedings in Australia and is also required for claims brought by infants or people suffering from a legal disability. A representative proceeding may not be settled or discontinued without the approval of the Court (e.g. section 33V of the Federal Court Act). If the Court gives such an approval, it may make such orders as are just with respect to the distribution of any money paid under a settlement.
Yes, government authorities can reclaim these amounts. A claimant is required to refund that part of the damages awarded or settlements paid, which have previously been awarded to the claimant as part of a social security benefit payment. This is to prevent "double dipping". The damages awarded or settlements paid are withheld from the claimant by the defendant until such time that repayment to the relevant government authority has been resolved.
The unsuccessful party usually pays the costs of the successful party. These costs include not only court filing fees, copying charges and other out-of-pocket expenses, but also the lawyer’s professional fees. In this context, a reference to costs is not a reference to the total or actual costs incurred by the successful party. Recoverable costs are generally calculated by reference to a court scale, which invariably limits the amounts a successful party can claim for disbursements and services performed by their lawyers.
In some jurisdictions, the Tort Reform Process has resulted in further limitations being imposed on the legal costs recoverable in small personal injury claims (although there are exceptions including where the lawyer and client have entered into a costs agreement that provides otherwise).
The common law rule has been significantly modified in the case of representative or class actions. Statutory provisions restrict a costs order being made against class members other than those who actually commenced the proceedings. Where the representative action is successful, a costs order may be made in favour of the class members who commenced the representative proceedings in an amount determined by the court.
Yes, public funding is available.
Legal aid services rigorously apply means and merits tests to determine eligibility for aid. As a general rule, very limited funding is available to assist claimants to bring civil actions, including product liability claims. Funding is available at the federal level for, inter alia, consumer protection matters, arising under a federal statute such as the ACL.
Recently, rules prohibiting lawyers from entering into contingency fee arrangements were relaxed and a variety of arrangements are now sanctioned. These new arrangements allow lawyers and clients to enter into an agreement which provides for the normal fee, or a fee calculated by reference to some pre-determined criteria such as the amount of time expended by a lawyer, to be increased by a pre-agreed percentage. The relevant rules generally impose a cap on the percentage by which such fees can be increased. Some jurisdictions allow lawyers to enter into an agreement to be paid an “uplift fee” where an additional fee may be levied, calculable by reference to the initial fees. All jurisdictions continue to prohibit contingency fee arrangements where the lawyer's fee is calculated by reference to a percentage of the client’s verdict.
Third party funding of claims is permitted in Australia, subject to the rules set out in question 7.4 above.
Australian Courts have broad discretion over legal costs of all proceedings. In effect, a court may make whatever order as to costs that are justified in the circumstances; although, there are court rules that govern the exercise of that power.
Australia's principal product safety regulator, the ACCC, is becoming increasingly active in its activities associated with product safety regulation. Product recalls are rigorously enforced and monitored. International remedial product safety actions are followed-up in Australia. Mandatory notifications are rigorously enforced and consumer protection proceedings are being initiated. Recently, the ACCC successfully commenced proceedings against a major national retailer alleging that such retailer made false or misleading representations about the safety of certain products. At the heart of this action is an allegation by the ACCC that the retailer failed to file mandatory reports as required by the ACL once it had become aware that serious injury of illness may have been caused by some of its products. This confirms that manufacturers and suppliers are still struggling to come to terms with the metes and bounds of the mandatory reporting requirements under the ACL. This reporting obligation arises not only when a supplier has actual knowledge of a relevant event, but also if they become aware of another person who considers there to be a notifiable event. In some instances where the facts are vague or if there are contradictory accounts, it can be difficult to decide whether the reporting requirements have been triggered.