Private International Law (Choice of Law in Tort) Bill

I have a question in respect of clause 7 of the bill. The bill as it was introduced and went to the Justice and Electoral Committee said nothing specific around personal injury. The select committee has seen fit to recommend a change, through clause 7(2) of the bill, where it says: “Where elements of those events”—which constitute a tort—“occur in different countries, the applicable law under the general rule is …”, and they insert this new subclause (aa): “for a cause of action in respect of personal injury caused to an individual or death arising from personal injury, the law of the country where the individual was when he or she sustained the injury;”.

Now, if I read the commentary that came back from the select committee, this is because there were concerns, presumably, that with the bill as drafted we were creating some possible confusion around New Zealand’s law relating to the accident compensation system. Of course, in New Zealand—and this is unusual compared with most jurisdictions around the world—we have a system where you cannot sue for personal injury. We have given up the right to sue for personal injury, where it was, effectively, a lottery largely on the basis of whether your injury was able to be proven to be caused by someone negligently, and whether you could afford legal representation to prove your case. If you did bring an action for personal injury, it was of course a barren remedy if the person you were suing had no money.

Essentially, people in New Zealand—and, indeed, this continues to the day in a lot of other jurisdictions—were not compensated on the basis of need. There was a lot of luck involved as to whether you got compensation, and we in New Zealand, in the 1970s, changed that so that everyone has a right to medical care, earnings-related compensation, and, in some cases, some lump sums, on the basis of need rather than on the basis of fault. So we have got a no-fault accident compensation system that replaces the tortious right to claim for personal injury.

The select committee has seen fit to change the general rule that went to the select committee. The general rule just said simply that “Where elements for those events [constituting a tort] occur in different jurisdictions, the applicable law under the general rule is taken as being—(a) for a cause of action in respect of … property”—they said something that is irrelevant to this point—and then “(b) in any other case, the law of the jurisdiction in which the most significant element or elements … occurred.”

There was no definition of personal injury in the version as it went to select committee, and there was no specific reference to actions for personal injury; there was just that general proposition in respect of actions other than those that were damage to property. The select committee has inserted the specific reference to personal injury to say that it is the law of the country where the individual was when he or she sustained the injury. I think this is perhaps quite an important point to get right in this bill, and I would like the member in the chair, Sarah Dowie, to address whether she is confident that with the changes made there is absolutely no doubt that we are in any way interfering with the operation of the accident compensation scheme that we have in New Zealand.

Thank you very much to the Hon David Parker for that contribution and those questions in relation to personal injury, under the Private International Law (Choice of Law in Tort) Bill. I also have to take the opportunity to thank Dr Maria Hook of the University of Otago, who is one of the submitters who has taken a particular interest in this matter also—to thank her for her contribution and her consideration of clause 7 in respect of personal injury.

There are a couple of considerations to look at first. The first is where a personal injury has been suffered in New Zealand and, of course, meets the definition under the Accident Compensation Act. In that case the statutory bar will apply. If the injury meets the standards in the definition under the Accident Compensation Act, then the statutory bar will apply and the plaintiff will not be able to sue. The second consideration is where the personal injury suffered in New Zealand does not meet the definition of personal injury under the Accident Compensation Act or for some other reason is not covered. So in that case the statutory bar under the Accident Compensation Act will not apply and, of course, the plaintiff can look to tort law and sue.

The next one is when personal injury has been suffered overseas and the plaintiff in some of those cases may have cover. The foreign law will govern wherever that injury did occur and the statutory bar will not apply. If the plaintiff has suffered a personal injury overseas but is also covered under the Accident Compensation Act, then it gets somewhat a little bit more complicated. That situation is made possible because of section 22 of the Accident Compensation Act and it extends cover to injuries suffered by New Zealand residents overseas in certain circumstances.

I have to again acknowledge Dr Maria Hook from Otago University, who has given me an example of a New Zealander injured, for example, on a faulty bicycle provided, say, by a French tour operator in France—so somewhat straightforward in nature. In this situation, French law would apply on the face of it—prima facie—but because the injury was suffered in France, New Zealand law would be excluded and in those circumstances the statutory bar would apply only if it was a mandatory rule under the bill, and that would override the choice of law in tort.

So that sets out what we are considering there, in the way that this bill is drafted, and of course the definition of personal injury—the way that it is drafted—is deliberately wide. That is so that it covers various types of personal injuries that may occur that may not be included in the Accident Compensation Act. It can include mental injuries that are not associated with a physical injury, for example. That is the reason why the committee has chosen that. It is also on the advice of officials. Hopefully, that answers the question of the member.

This is a fascinating bill, the Private International Law (Choice of Law in Tort) Bill and I think Sarah Dowie, the member in charge of the bill, was doing herself a bit of a disservice when she commented with, basically, words to the effect that she sort of inherited the bill and she was not wildly enthusiastic about being the person in charge of it. But I think that is doing herself a disservice because I think she is actually very excited about this and I know that she has commented to me privately that a bill like this is really good. That is good because actually, as we know from her chairpersonship of the Justice and Electoral Committee, a legal background is very helpful.

I want to raise a question with the member about clause 10 in Part 2 of the bill, which is about the rule of double actionability and related common law rules being abolished. What this clause basically does is abolish rules of common law to the extent that they apply to a claim in tort. Clauses 10(a) and (b) are about actionability under both New Zealand law and the law of another country for the purpose of determining whether a tort was actionable. This is essentially part of the double actionability clause that we are abolishing, and then the exception rules are in clause 10(b). I guess all I am just asking is whether the member in charge of the bill is comfortable with abolishing wholesale common law rules, because traditionally the Parliament is very cautious about abolishing common law rules.

I mean, the common law is a creature of the courts. It is judge-made law, it has evolved through centuries—hundreds of years—particularly when it comes to tort law, which is essentially an invention of common law going back through to Donoghue v Stevenson and some of the cases before that. It is essentially an invention of common law and I think there is a point where the Parliament and the legislature should be a bit cautious and a bit sceptical about treading on to the realm of common law. Of course Parliament is sovereign, Parliament can do whatever it likes subject to the inherent rights and freedoms and, without getting into a debate about Lord Cooke’s famous dictum, I just raise the point for the member. [Interruption] Jono Naylor says: “No, come on.” But I am sure the Chair will encourage well back to the scope if I started talking about Lord Cooke and fundamental rights and law journal articles that I thought I had long forgotten from my law school days, but it turns out that apparently I have not.

I just raise the point about treading on to the path of the common law, because Parliament is traditionally a bit cautious about doing that and what we are doing here, through clause 10, is we are saying that the following rules of common law are abolished, which is starkly put in clause 10. It is very starkly put and we just need to be careful about doing that. I mean, to be fair, there is a fetter in clause 10 and it says the following rules of common law are abolished but “to the extent that they apply to a claim in tort”. So we would not want to get ahead of ourselves, we are not making some massively drastic wholesale change to the common law, but we are abolishing a couple of rules of common law. So I just raise that point with the member in charge of the bill to make sure that she is absolutely confident that it is the right path to go down and that we have got the wording of the clause exactly right.

I would just like to pick up where my colleague Chris Bishop has left off, which is around clause 10. I have some points around clause 10 that I would like to make that are different from the ones that he was looking for. The double actionability nature, where clause 10 is looking to remove the double actionability rule, is very important.

If anyone was paying attention, which they probably were not, to my second reading speech, we looked to where that double actionability rule first evolved from—it actually came from right back in 1870 when there was a rogue Jamaican governor who actually managed to then hide behind this double actionability rule, based on the fact that he had been engaged in some pretty outrageous acts of flogging, executing, and imprisoning people without, really, much cause. Of course, by the time he had retreated back to the UK he had managed to hide behind the laws of both countries. So it is clearly important to me that clause 10, in getting away from there needing to be an actionable legislation in both the country in which it occurred and back here in New Zealand for you to be able to take an action against somebody, is very important.

If, for example, there were two New Zealanders between whom something had gone down overseas, if it did not meet the threshold of double actionability, as is the case now, the only option available to that person, of course, would be to take legal action against the other person in the jurisdiction where it occurred. If you have got a New Zealander wanting to take action against another New Zealander in a foreign jurisdiction, that is entirely and completely difficult—not to mention the fact that that jurisdiction may not have an ability to apply anything to the offending party anyway. So that would always have been a long shot.

So I think by getting rid of the double actionability rule we are making is a very clear statement that, actually, if you are in a country and you contravene that country’s laws and you cause harm to another person, you can be liable for that in New Zealand, regardless of New Zealand law. I think a very useful part of this legislation is that it removes that double actionability rule.

Clause 7 is also particularly interesting, in that it establishes a general rule, which is focused on the place of wrongdoing. As I just mentioned when talking about clause 10, it is actually where that occurs. There are different elements involved in this. Clearly, it means that the law will be applied to the case where the law of the jurisdiction where it occurred will apply, and where the events that give rise to the claim occur. The difficulty, though, is where different elements of the questionable events may have occurred in different countries. So this new general rule is split into three parts. For personal injury, the law of the country where the personal injury or death occurred applies. I think it is important to note that this does not affect New Zealand’s ACC provisions.

Secondly, for actions that relate to damage to property, again, it is the law of the country where the property was when it was damaged. So the property does not need to be owned in that country. For example, if it was property that I owned here, whether it was some sort of—I do not know what it is you would take overseas; a camera or whatever it was. It is about where the property was at the time when the questionable event occurred.

The hazy part, I guess, also needed clarity. That is in the third part, where it talks about “in any other case, the law of the country in which the most significant element or elements of those events” that give rise to the action applies—that is, where the majority of the actionable behaviour occurred. It is the law within that jurisdiction that applies. So if there was something that was ongoing that occurred in multiple jurisdictions, then, of course, it would then be up to the court to determine where the majority of it had occurred—where most of it had occurred—in order to be able to ensure, ultimately, that there is an ability for that action to take place.

There is of course an exception to this general rule, because, of course, whenever you have a general rule there is always bound to be an exception somewhere along the line, and clause 8 actually provides for this. By virtue of clause 8 the court then is allowed to apply the law of another country where it is substantially more appropriate to do so. So what this does is it actually gives the judiciary some discretion to assess the merits of applying the law of a different country, on a case by case basis.

In the Committee stage debate on the previous bill, the Films, Videos, and Publications Classification (Interim Restriction Orders) Amendment Bill, we talked about the importance of having flexibility. When things are simply done in a hard and fast way, particularly when it comes to tortious acts, there is always going to be a certain level of grey area. So it is important for the judiciary to be able to have some discretion to assess the merits of applying different law in the country on a case by case basis. So the courts, when doing this, obviously do not just have a carte blanche ability to do it at will or whenever they like, but they must consider that the significance of the factors that connect a tort with the country whose law would be the applicable law under the general law, and the significance of any factors connecting the tort with any other country. So it is not just a random thought—not that, I am sure, our judiciary ever just has random thoughts, because they are very well-considered people—what they have to do is actually weigh up the significance of any factors that they may have, if they want to apply this exception to the general rule.

So, ultimately, I think what we have is, again, a piece of legislation put together initially—we keep lauding the Hon David Bennett for his work on this, but I think Chris Auchinvole actually had a bit of a part to play in this as well before he left at the end of the 50th Parliament. The Hon Dave Bennett picked it up and, of course, Sarah Dowie has taken it through. We have got, I think, a piece of legislation that will make it easier for New Zealanders who have had wrongs done to them outside of New Zealand to be able to take action to actually rectify and bring some closure to them, and to bring some sort of remedial action through the courts to make up for any losses, any injuries, or any damage that they have had to property. So it is great to see that there has been such good support for this, and I look forward to the third reading of the bill.

I stand tonight in the Committee stage of the Private International Law (Choice of Law in Tort) Bill. At present we are discussing Part 2. Part 2, we have heard, contains the general rule. In the discussion and debate in the Justice and Electoral Committee around these parts of this bill, there were some changes made. One of those changes was to the use of the word “jurisdiction”, where “the applicable law is the law of the jurisdiction” was changed to differentiate between countries where they have state laws, such as in Australia or the US. So we now talk about “the law of the country in which the events constituting the tort in question occur.”

This Private International Law (Choice of Law in Tort) Bill is very similar to the UK Act, and that Act was seen during the select committee stage to be a valuable resource in providing a body of case law, which has accrued in the UK, to help with the interpretation and the application of this legislation here in New Zealand.

As my colleague Jono Naylor has talked about previously, clause 7, “General rule”, talks about personal injury, and that does mean a physical or mental injury—even if the injury causes death. It also, in this clause, includes disease or infection, so even now we are including things that may be communicable diseases. They also fit into this general rule of this choice of law in tort.

The clarification around the countries where these general rules apply does have some examples that make it clear why these amendments and this bill are required here. Using the example of a New Zealand employee who is working overseas and is injured in his place of work in an unsafe workplace, what law should govern his claim of negligence against his employer in that case? For instance, is it the law of the country in which the event took place, is it New Zealand law as he is a New Zealander, or perhaps if the parent company is an Australian company, would that also qualify as the place where this case would be heard?

So this bill clarifies that. It becomes a bit of a nonsense in those situations where those arguments about the appropriateness of the country in which the cases will be heard actually consume probably more court time than actually getting on with the substance of the dispute would, and so people are spending all their time in court determining those sorts of matters, rather than the substance.

So these provisions are displacing the general rule. An example of that would be where two people are travelling in New Zealand and something happens while they are here. It is best that that is dealt with in their home country, and so there is an opportunity for the court to use its discretion and allow for that case to be heard in their home country.

As we have also heard, this bill has been around for quite some time. It is very reassuring to see it getting to the end of the debate on it in this Committee stage, and I commend it. Thank you.

Part 2 agreed to.

Schedule 1