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This is a Bill, not an Act. For current law, see the Acts databases.


PROFESSIONAL STANDARDS AMENDMENT (DEFENCE COSTS) BILL 2006




                        New South Wales




Professional Standards Amendment
(Defence Costs) Bill 2006


Contents

                                                                    Page
           1   Name of Act                                            2
           2   Commencement                                           2
           3   Amendment of Professional Standards Act 1994 No 81     2
           4   Repeal of Act                                          2
  Schedule 1   Amendments                                             3
I certify that this PUBLIC BILL, which originated in the LEGISLATIVE ASSEMBLY,
has finally passed the LEGISLATIVE COUNCIL and the LEGISLATIVE ASSEMBLY of
NEW SOUTH WALES.


                                               Clerk of the Legislative Assembly.
                                               Legislative Assembly,
                                               Sydney,                     , 2006




                            New South Wales




Professional Standards Amendment
(Defence Costs) Bill 2006
Act No      , 2006




An Act to amend the Professional Standards Act 1994 with respect to schemes that
limit the occupational liability of members of occupational associations.




I have examined this Bill, and find it to correspond in all respects with the Bill
as finally passed by both Houses.


                          Chairman of Committees of the Legislative Assembly.
Clause 1          Professional Standards Amendment (Defence Costs) Bill 2006




The Legislature of New South Wales enacts:
 1    Name of Act
               This Act is the Professional Standards Amendment (Defence Costs)
               Act 2006.
 2    Commencement
               This Act commences on assent.
 3    Amendment of Professional Standards Act 1994 No 81
               The Professional Standards Act 1994 is amended as set out in
               Schedule 1.
 4    Repeal of Act
         (1)   This Act is repealed on the day following the day on which this Act
               commences.
         (2)   The repeal of this Act does not, because of the operation of section 30
               of the Interpretation Act 1987, affect any amendment made by this Act.




Page 2
Professional Standards Amendment (Defence Costs) Bill 2006

Amendments                                                               Schedule 1




Schedule 1             Amendments
                                                                            (Section 3)
[1]   Section 4 Definitions
      Insert in alphabetical order in section 4 (1):
                    costs includes fees, charges, disbursements and expenses.
[2]   Section 4 (1), definition of "damages"
      Omit the definition. Insert instead:
                  damages means:
                   (a) damages awarded in respect of a claim or counter-claim or
                         claim by way of set-off, and
                   (b) costs in or in relation to the proceedings ordered to be paid
                         in connection with such an award (other than costs
                         incurred in enforcing a judgment or incurred on an appeal
                         made by a defendant), and
                   (c) any interest payable on the amount of those damages or
                         costs.
[3]   Section 4 (1A)
      Insert after section 4 (1):
           (1A)     A reference in this Act to the amount payable under an insurance
                    policy in respect of an occupational liability includes a reference
                    to:
                     (a) defence costs payable in respect of a claim, or notification
                          that may lead to a claim (other than reimbursement of the
                          defendant for time spent in relation to the claim), but only
                          if those costs are payable out of the one sum insured under
                          the policy in respect of the occupational liability, and
                    (b) the amount payable under or in relation to the policy by
                          way of excess.




                                                                              Page 3
                 Professional Standards Amendment (Defence Costs) Bill 2006

Schedule 1       Amendments




[4]   Section 21
      Omit the section. Insert instead:
         21   Limitation of liability by insurance arrangements
                    A scheme may provide that if a person to whom the scheme
                    applies and against whom a proceeding relating to occupational
                    liability is brought is able to satisfy the court that:
                     (a) the person has the benefit of an insurance policy insuring
                            the person against the occupational liability to which the
                            cause of action relates, and
                    (b) the amount payable under the policy in respect of that
                            occupational liability is not less than the amount of the
                            monetary ceiling specified in the scheme in relation to the
                            class of person and the kind of work to which the cause of
                            action relates,
                    the person is not liable in damages in relation to that cause of
                    action above the amount of that monetary ceiling.
[5]   Section 22 Limitation of liability by reference to amount of business
      assets
      Omit "at the time at which the act or omission giving rise to the cause of action
      occurred" from section 22 (a).
[6]   Section 22 (b) (ii)
      Omit the subparagraph. Insert instead:
                        (ii) the net current market value of the business assets
                               and the amount payable under the policy in respect
                               of that occupational liability, if combined, would
                               total an amount that is not less than the amount of
                               the monetary ceiling specified in the scheme in
                               relation to the class of person and the kind of work
                               to which the cause of action relates,




Page 4
Professional Standards Amendment (Defence Costs) Bill 2006

Amendments                                                                     Schedule 1




 [7]   Section 23 Limitation of liability by multiple of charges
       Omit section 23 (1) (a) (ii). Insert instead:
                          (ii) under which the amount payable in respect of that
                                  occupational liability is not less than an amount (the
                                  limitation amount), being a reasonable charge for
                                  the services provided by the person or which the
                                  person failed to provide and to which the cause of
                                  action relates, multiplied by the multiple specified
                                  in the scheme in relation to the class of person and
                                  the kind of work to which the cause of action relates,
                                  or
 [8]   Section 23 (1) (c) (ii)
       Omit the subparagraph. Insert instead:
                         (ii) the net current market value of the assets and the
                                amount payable under the policy in respect of that
                                occupational liability, if combined, would total an
                                amount that is not less than the limitation amount,
 [9]   Section 26A
       Insert after section 26:
       26A   Liability in damages not reduced to below relevant limit
                    The liability in damages of a person to whom a scheme applies is
                    not reduced below the relevant limitation imposed by a scheme
                    in force under this Act because the amount available to be paid to
                    the claimant under the insurance policy required for the purposes
                    of this Act in respect of that liability is less than the relevant
                    limitation.
                    Note. Section 4 (1A) permits a defence costs inclusive policy for the
                    purposes of this Act, which may reduce the amount available to be paid
                    to a client in respect of occupational liability covered by the policy.
                    Section 26A makes it clear that this does not reduce the cap on the
                    liability of the scheme participant to the client, and accordingly the
                    scheme participant will continue to be liable to the client for the amount
                    of any difference between the amount payable to the client under the
                    policy and the amount of the cap.

[10]   Section 28 Limit of occupational liability by schemes
       Omit "at the time of the relevant act or omission" from section 28 (2).
       Insert instead "at the time at which the act or omission giving rise to the cause
       of action concerned occurred".




                                                                                     Page 5
                 Professional Standards Amendment (Defence Costs) Bill 2006


Schedule 1       Amendments




[11]   Schedule 4 Savings, transitional and other provisions
       Insert at the end of clause 1 (1):
                     Professional Standards Amendment (Defence Costs) Act 2006
[12]   Schedule 4, Part 5
       Insert after Part 4:

       Part 5        Professional Standards Amendment
                     (Defence Costs) Act 2006
         16   Definition
                     In this Part, amending Act means the Professional Standards
                     Amendment (Defence Costs) Act 2006.
         17   Validation of schemes etc
              (1)    A scheme approved under this Act before the commencement of
                     the amending Act is taken to be, and always to have been, a valid
                     scheme if it would have been valid had the amendments made by
                     the amending Act been in force when the scheme was approved.
              (2)    Anything done or omitted to be done in respect of such a scheme
                     is taken to be, and always to have been, validly done or omitted.
                     In particular, an insurance policy required by this Act before a
                     limitation on liability in damages of a person to whom such a
                     scheme applies is reduced is taken to comply, and always to have
                     complied, with this Act if it would have complied had the
                     amendments made by the amending Act been in force when the
                     policy was issued.
              (3)    This clause extends to proceedings pending in a court on the
                     commencement of this clause.




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