In mid-2004 proportionate liability reform became effective in
Australia, removing joint and several liability for certain causes
of action. Under the old system, the insolvency risk associated
with other wrongdoers fell on the defendant against whom the
plaintiff successfully sued and elected to recover judgment, which
unfairly meant a single defendant could bear 100% of a loss
notwithstanding that the acts of another wrongdoer caused the same
damage.
It was hoped by many that reform would address the crisis of
high claim costs associated with liability insurance, by removing
the burden faced by "deep pocket" defendants routinely
targeted in litigation, despite others also causing the same loss
and damage which was the subject of a claim. This article explores
the impact of the reforms on claims against financial services
professionals.
