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House of Assembly - Fifty-Second Parliament, First Session (52-1)
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MOTOR VEHICLES (THIRD PARTY INSURANCE) AMENDMENT BILL

Second Reading

Adjourned debate on second reading.

(Continued from 15 September 2010.)

The Hon. I.F. EVANS (Davenport) (11:02): I indicate that I am the lead speaker on this bill for the opposition. The bill that we are debating—the Motor Vehicles (Third Party Insurance) Amendment Bill—essentially deals with the insurance scheme operated by the Motor Accident Commission (MAC) in relation to motor vehicles.

The intent of the bill is to make a series of amendments that seek to restrict in some cases and clarify in others what can and cannot be claimed, what will and will not be paid out and what can and cannot be recovered by MAC against drivers involved in certain incidents, depending on the nature of the incident.

I want to make some comments in relation to the consultation process because I am a little surprised as to what has happened, as I understand it, in regard to this bill. This bill was introduced back in September, and, as part of the normal process, I wrote to the Law Society, the RAA, the South Australian Road Transport Association, the Motor Trade Association and the Australian Lawyers Alliance to seek their input or comment on this bill.

Regrettably, the only organisation that got back to me before I went to the party room to seek a position on this bill was the RAA. The other organisations, or at least two of them, have indicated to me some surprise that this bill was being introduced. The Motor Trade Association was not consulted until I wrote to it. It then rang the Motor Accident Commission, which understood that the MTA was on its reference group. It is not on its reference group, so the Motor Trade Association has only tried to deal with this bill since 20 September, when I wrote, and, as yet, it has not reached a final position, as I understand it. It has some concerns that it has written to MAC about in the last few days and MAC has written back in the last day or two, and I will read those letters into Hansard at the appropriate time.

What really surprised me was the Road Transport Association. Some of the clauses in this bill deal directly with the heavy vehicle driver fatigue scheme. The Road Transport Association told me that it has not heard anything about this bill since Geoff Vogt was still head of the Motor Accident Commission. It thought it was last talked to about this bill some four, possibly five, years ago and it was a bit surprised that a bill had been introduced in relation to this matter. That is what we were told, and I have no reason to doubt it.

The opposition comes to the debate still waiting on formal responses from the Law Society and the South Australian Road Transport Association. The Motor Trade Association emailed me at 10.40 this morning. So, 25 minutes ago I got something from the Motor Trade Association that outlines at least one concern it has. While the government has brought this on, if some of the trade and industry associations that this directly affects have not been talked to for over four years, you would have to wonder what is the rush to bring it on at this time. However, the government has brought it on, so the opposition will make its contribution and we will have to deal with a series of questions in committee. Ultimately, with anything that comes out of the committee stage, the opposition will reserve its right about amendments in another place.

Let me walk you through some issues or amendments the bill seeks to make. There are broadly nine categories of amendments, without specifically going into the details of each one. Amendment No.1 deals with the recovery from hit-and-run drivers. The Motor Vehicles Act 1959 is to be amended by this bill to make a hit-and-run offence under section 43 of the Road Traffic Act a breach of warranty under the policy of insurance, and therefore it becomes the subject of recovery action under section 116, which is the nominal defendant clause, and section 124A of the Motor Vehicles Act, which is the insured person clause.

Drivers who fail to stop and give all possible assistance to an injured person following a crash and who fail to report the accident to the police within the required time and submit to a drug and alcohol test could become liable to recovery to the Motor Accident Commission or the nominal defendant for claims cost. The amount to be recovered would be what the court deems reasonable and just in the circumstances.

Section 43 of the Road Traffic Act essentially provides that a person must abide by all three conditions, otherwise they will be guilty of an offence. In the event that all these conditions are not met, this would give rise to a potential right of recovery by MAC under part 4 of the Motor Vehicles Act. Section 43 deals with the duty to stop, to give assistance and to present to police where a person was killed or injured in an accident. You have to meet all those conditions.

If you are involved in an accident where someone is killed or injured, you have to stop, you have to give assistance and then you must present yourself to police: you have to meet all three tests. If you do not, then under this provision MAC will certainly seek to recover costs against you. I will come to what the industry groups say about this in committee, although I might do it as we go along as it might help the Treasurer, since the consultation has been a bit botched.

The Hon. K.O. Foley: It hasn't been botched; it has gone on forever.

The Hon. I.F. EVANS: The Treasurer says it hasn't been botched; it has gone on forever. That may well be true but it is not what the industry groups tell me. The RAA have opposed this particular provision. They believe that most of the drivers out there think they have 24 hours to report an accident to the police. Under this particular provision, they have only 90 minutes to report it to the police. The RAA say there are going to be a lot of people caught by this provision, thinking that they have 24 hours when in actual fact they only have 90 minutes, so if they do not report it within the 90 minutes they then become personally liable, so their house, their business, etc., will be on the line for a right of recovery by MAC because they have breached that particular provision in section 43 of the Road Traffic Act.

So the RAA are opposed to that. They also raise the issue of people not being able to get to the police within the required time, although I think the government will argue there are suitable defences in the existing acts; but the RAA did raise that particular point.

There are a number of examples in this particular piece of legislation where the government is introducing burdens of proof that are going to be on the balance of probabilities, which is the lower burden of proof, and a number of industry groups have raised concerns about the lower level of proof and not using the higher level of proof. I will not go through each example, but throughout the bill there are at least five examples where the lower level of proof is used rather than the higher level of proof.

The second line of amendment deals with the heavy road transport industry and, in particular, the chain of responsibility in that industry. Members might recall that the house has previously dealt with legislation to do with the heavy vehicle road transport industry and the fatigue laws. This links in to that particular piece of legislation. This amendment aims to make it easier for the Motor Accident Commission to recover claim costs from those higher up the chain in the transport industry who are liable for putting pressure on the truck drivers to breach driver fatigue related laws in the heavy vehicle industry.

Currently there is a limited opportunity for MAC to recover against persons within the chain of responsibility who are not otherwise injured under the CTP policy. It is envisaged that the persons who will fall within the chain of responsibility as specified in the regulations will include the employer, prime contractor, operator, scheduler, consignor, consignee, loading manager, loader and unloader. All those people will become potentially liable for recovery by MAC against them if there is a breach of the driver fatigue laws. They are seen to have some part in it, and I will come to that later during the committee stage.

The amendment intends to encapsulate anyone who has placed pressure on a driver to undertake illegal activities, and it is about control, not necessarily the employee relationship. So it is not just the employer who ends up possibly having a claim of recovery against them, but the consignee, the consignor or the warehouse manager, etc. All those people could potentially be up for a cost of recovery if they are found to have been involved in some possible breach.

The right of recovery is linked to the heavy driver fatigue regulations that were enacted in South Australia in 2008. The trigger point for recovery is the commission of an offence pursuant to the Road Traffic (Heavy Vehicle Driver Fatigue) Regulations. Regulation 6 creates the offence of driving a regulated heavy vehicle if the driver is impaired by fatigue. However, the regulation also creates offences for parties in the chain of responsibility in relation to a regulated heavy vehicle if they do not take all reasonable steps to ensure that the driver of the vehicle does not contravene that particular regulation.

Now, for the purposes of the regulation, the following persons are parties in the chain of responsibility in regard to regulated heavy vehicles: the employer of the driver of the vehicle; the prime contractor of the vehicle; the operator of the vehicle; a scheduler in relation to the driver of the vehicle or the vehicle; the consignor of goods to be transported by the vehicle; the consignee of goods to be transported by the vehicle; the loading manager of goods to be transported by the vehicle; the loader of goods on to the vehicle; and the unloader of goods from the vehicle.

Legislation matching that particular legislation has been enacted in New South Wales, Victoria and Queensland; however, we are advised by the government that no other state is seeking to extend its right of recovery to these parties. The advice to the opposition is that this will be the only state—indeed, the first state—to seek recovery from those parties under these conditions. A significant number of bordering states have corresponding laws and offences such that moving registration to another state will not avoid exposure to a potential prosecution under the existing legislation but will avoid potential recovery under this new legislation, if passed.

The introduction of a right of recovery is intended not only to recoup the cost but also to create a further deterrent to the commission of these offences. The right of recovery proposed for these parties is limited to the amount that the court thinks is just and equitable as a stopgap measure to ensure fairness in relation to the imposition of any liability. The government argues that the ability to avoid any potential recovery is entirely in the control of the parties involved in the chain of responsibility, by ensuring that they do not commit an offence under regulations.

That particular set of amendments is primarily targeted at the heavy freight road transport industry. The Treasurer will stand up, after my contribution, and say that the consultation process was not botched, but I make this point to the house: if the consultation process was not botched, and we wrote to the South Australian Road Transport Association on 20 September about this bill, and if the consultation has been so good, why is it that, as of this morning, the board of SARTA still does not have a position on the bill? It says that it was talked about over four years ago. It did not know it was being introduced now, so, if you like, at that point it had not prepared a submission.

This is a piece of legislation that is critical to that industry, and I say that the consultation has been botched. The evidence is very clear. If the industry had been 'consulted to death' it would have had a set of documents and a position ready to go when the government introduced the bill. Clearly it would be ready, because there are some serious implications for the heavy road transport industry in this bill. For it not to have a submission ready—and I do not criticise it at all—is illustrative of the fact that the government has brought this in without actually notifying the industry that it was reinvigorating this particular bill, which was talked about four years ago.

The South Australian road transport industry does have some major concerns with this bill. At quarter to 10 this morning Steve Shearer sent me an email, on the proviso that I made it clear that the board had yet to reach a position, so it is hard for the opposition to reach a final position when the industry group that the legislation affects has not yet reached a final position. Mr Shearer wrote:

Thanks for consulting with SARTA on this Bill.

Some years ago, I had discussions with the MAC on where the concept of Chain of responsibility was discussed—I think this was in 2005 or 2006.

The Hon. K.O. Foley: He thinks.

The Hon. I.F. EVANS: That is what the industry group thinks. His email continued:

Since then I have not heard back from the MAC nor seen any proposals to apply CoR to the Recovery of Insurance payments by the MAC.

The major concern that we have with this proposal is that it will be based upon acceptance of a court 'finding' regarding whether or not a person committed an offence against Section 43 or a relevant offence against a Heavy Vehicle driver fatigue scheme, as determinative in any action by the Insurer.

The problem is that under the CoR [chain of responsibility] laws for managing Driver Fatigue, which the industry supports, the relevant parties are Guilty at the outset, under the Reverse Onus of Proof principles that applies under those laws.

So one walks into Court Guilty and must be able to prove that they are innocent through a Reasonable Steps Defence.

The problem is that under the CoR [chain of responsibility] laws for managing Driver Fatigue, which the industry supports, the relevant parties are Guilty at the outset, under the Reverse Onus of Proof principles that applies under those laws.

So one walks into Court Guilty and must be able to prove that they are innocent through a Reasonable Steps Defence.

Hence, an operator or driver or other party who was actually innocent, may be treated as guilty because they have failed to [simply] gather and record the evidence that would have proven their innocence.

To automatically consider such a court 'finding' (which really is a finding that either the party did prove a Reasonable Steps Defence or that they did not and it is NOT a finding of guilt but an absence of finding of proof of innocence) is very concerning because it could lead to massive financial penalties in the form of MAC recovery against a person/party whose crime was that they failed to keep good records.

Whilst the trucking industry supported the CoR laws in relation to Driver fatigue, it was because this was the only way to effectively rein in the parties that are one or two steps removed from the problem. Our agreement was also based upon the level of penalties and sanctions involved.

The Third Party Insurance extension of this concept without any requirement of a more appropriate standard of proof...would seem both unjust and unreasonable.

One would have thought that if the authorities are able to defend their case against a Party in a Driver Fatigue related matter in court—and win—then the MAC ought to be able to access relative evidence and mount a case based upon the more conventional balance of probabilities—

I am not convinced he doesn't mean beyond reasonable doubt but he uses the words 'balance of probabilities'—

perhaps using the CoR matter but NOT taking it as determinative.

That was at quarter to 10 this morning. As I say, Mr Shearer made it clear to me that, as of this morning, their board still had not reached a position on the legislation.

So, that is the second set of amendments which deals with rights of recovery for breaches of the fatigue legislation to do with the heavy road transport industry. The South Australian Road Transport Association—the peak body for that industry—have some concerns with it and have yet to reach a position at their board level.

The third amendment deals with excess recoveries. There is an excess provision within the existing act which, from memory, has been fixed at around $300 since the early 1990s. This particular bill seeks to increase the excess to $460 and then have it increase by CPI. It also seeks to introduce a 5 per cent discount if it is paid within a certain time frame.

The RAA actually have some concerns about that particular matter as well. They argue that the $460 excess benefits the financially well off. The excess will penalise those who are not financially well off. The RAA say that the government would get a far better response to payments to MAC on this issue if they advertised how the excess works, because there is confusion.

The way the RAA spoke to me about it, there is confusion that, when someone is involved in an accident, they pay their normal insurance excess and that claim is settled, then MAC recovers, there is another excess, and the average punter out there is saying, 'Hang on a minute, I have already paid my excess,' and there is a confusion about the double excess. The RAA argues that they would get a far better response to this excess matter if they actually ran some form of public education system about it.

The fourth set of principle amendments in the bill deals with recovery for blood alcohol content offences, which for the purposes of this debate I will broadly call drunk-driving offences. Currently, the alcohol reading threshold for pursuing a recovery for breach of the policy of insurance is 0.15 per cent. It is proposed to amend the Motor Vehicles Act, to reduce the threshold to allow recovery of claim costs where the insured has a proven blood alcohol certificate of 0.1 per cent or more.

The legal blood alcohol content limit is .05 per cent, and the recovery level that is to be set in this bill will be reduced from .15 to 0.1, which is still a doubling of the blood alcohol content before there is a right of recovery for the Motor Accident Commission.

We are told that in Victoria and the Northern Territory a recovery is possible where the driver has been convicted of an offence as a result of the collision and the offence involves driving with a blood alcohol content of .05 per cent, .08 cent or more respectively. There are rights of recovery in those particular jurisdictions. Western Australia does not have a prescribed minimum blood alcohol content level but, rather, allows a recovery where the driver is under the influence of alcohol. Queensland, Tasmania and the ACT do not require a minimum blood alcohol content for recovery against an intoxicated driver; instead, it is necessary to establish the driver was either incapable of or unable to exercise proper or effective control of the vehicle.

I requested some extra information from the government related to the number of accidents and claims over the last two or three years and the loss, if you like. The number of accidents in 2008 was 4,370; in 2009, it was 4,960; and in 2010 it was 4,681. The number of claims in 2008 was 5,660, and the total net incurred was approximately $297 million. The number of claims in 2009 was 6,450, and the total net incurred was about $260 million, and in 2010 there were 5,985 claims, and the total net incurred was about $175 million.

I asked the question about the number of accidents claimed and the total net loss incurred where the driver is over 50 per cent responsible and has a blood alcohol content reading of .05 and the number of accidents between .05 and .08. The number of accidents in 2008 was eight; in 2009, it was four; and in 2010 it was two. The number of claims in 2008 was 10; in 2009, it was six; and in 2010 it was two. The point of the question was the low-level numbers of accidents that fall into those categories.

In relation to higher levels, if we look at where the new threshold will kick in, which is 0.1, the number of accidents in 2008 was 16; in 2009, it was seven; and in 2010 it was 13. The number of claims in 2008 was 28; in 2009, it was 10; and in 2010 it was 23. The net costs incurred were $8 million in 2008, only about $500,000 in 2009, and about $1 million in 2010. Again, low figures but, MAC would argue, all have an impact on their premium level and their payouts. So, that is the nature of that group of amendments.

The fifth set of amendments deals with the principle of how people who are subject to a claim need to cooperate with MAC about providing information—their address, their name and those sorts of things. I do not intend to go into that in any great detail. There is an increase in penalty from $250 to $5,000, so there are some pretty big incentives for people to cooperate with MAC in that regard. There is also a set of amendments to do with the provision of evidence which is pretty self-explanatory, and I do not intend to debate it in my contribution.

The seventh set of amendments is in relation to the exposure of the CTP fund to international forum shopping. The Motor Vehicles Act is to be amended to limit the liability of the South Australian compulsory third-party scheme in the event of an enforceable foreign judgement being made against the motorist insured by MAC. It should also be noted that several interstate schemes have similar legislation—for example, Queensland and New South Wales.

Should the compulsory third-party scheme in South Australia not have similar protection, it could potentially be exposed to substantial risk which will undermine the solvency of the scheme. One example is a tourist being in a car accident here in South Australia taking action in a court in their home jurisdiction and getting a court order for money and recoveries that an Australian resident would not necessarily get. It is a case of a foreign jurisdiction imposing, if you like, a decision on the South Australian scheme. This particular amendment will prevent international forum shopping.

The eighth set of amendments deals with the assessment for non-economic loss and damages. Section 52(2)(a) of the Civil Liability Act is to be amended to reinforce the proportionality intention of the non-economic loss point scale and to provide an example to the courts to serve as a constant guide on the application of the scale. The amendment is intended to remind all stakeholders of the need for there to be proportionality in the application of the zero to 60 point scale, where 60 points reflects the gravest conceivable kind of injury.

In MAC's view, there have been very few instances of there being a need for an adjustment of an award for non-economic loss by the courts. In one example, an award of 40 points has been made for the early onset of a serious psychiatric illness due to a vehicle collision. The judge found for economic loss or care and treatment. Forty points, which is just 20 points less than the gravest conceivable kind of a psychiatric condition that was going to develop anyway, is perhaps disproportionately high.

The primary concern for MAC is to remind those who apply section 52—which I can only assume is the courts—during the course of negotiations to keep the proportionality principle in mind. In this example the decision has been appealed by the plaintiff who wishes to challenge the judge's finding on causation. The award for non-economic loss is likely to be addressed during appeal.

What all that means is that the courts have made a decision to award some poor soul who was injured a 40 point rating out of a possible 60, where 60 is the worst rating. Then you get award damages based on the level of points. MAC wants to politely remind the courts how this scheme is intended to work by putting an example in the legislation. So, that is the intention of this particular amendment.

Amendment No. 9 deals with the meaning of the expression 'caused by or arising out of the use of a motor vehicle'. This particular clause causes concerns for the Motor Trade Association. The Motor Trade Association was not consulted on this bill until I wrote to it. So, while the consultation may have gone on for ages, the reality is that the Motor Trade Association was not consulted until after 20 September this year. We know this because the Motor Trade Association wrote to us thanking us for bringing the bill to its attention.

John Chapman rang Mr Tuffnell of the Motor Accident Commission. My understanding was that the Motor Accident Commission thought that the motor traders were on their reference group that was being consulted. They were not so, as a result, the legislation has been introduced without the motor traders' input—and they do have some concerns. There have been letters exchanged between the Motor Accident Commission and the Motor Trade Association as late as 9 November, which is today.

So, as we debate the bill today, the Motor Accident Commission and the Motor Trade Association, to which the legislation will apply, are still unresolved in their position. If the government does want to adjourn this at the end of the second reading so that the two industry groups can further negotiate and reach a position, the opposition will not criticise the government for doing that, if it so wishes.

Amendment No. 9, as I said, deals with the meaning of the expression 'caused by or arising out of the use of a motor vehicle'. The government is proposing that the Motor Vehicles Act be amended to maintain the parameters which define the scope of the compulsory third party cover insofar as deciding what injuries or death were 'caused by or arising out of the use of a motor vehicle'. The intention of the amendment is to exclude bodily injury or death being caused by the displacement of goods while a motor vehicle is being loaded or unloaded, or as a result of the unintended movement of a vehicle whilst being serviced, displayed, restored or equipped.

To put that in very plain English, the government is intending to change the compulsory third-party scheme so that if someone is injured while a vehicle is being loaded or unloaded that cost will not be worn by the compulsory third party scheme, that cost is going to be worn by that person's private insurance or business insurance, or if they do not have any insurance, by that person personally. They are transferring the cost out of the compulsory third party scheme either to the business insurance or the private resident's insurance, and if they do not have insurance, it will mean their house and assets are on the line.

It will also mean that, if someone is injured or killed as a result of 'an unintended movement of the vehicle whilst it is being serviced, displayed, restored or equipped', then again the payout for that injury or death will transfer from the compulsory third party scheme either to the business's insurance or the private resident's insurance, or if they do not have insurance, to the individual privately. The motor traders naturally, you would think, would have some interest in this matter because they do service, display, restore and equip vehicles, as do a whole range of businesses that now come to your home or business and service the vehicle on site. You can ring up and say, 'My car is going to be at work today,' and they will drive out to your workplace and service it in that car park or, indeed, in your driveway, if you wish, rather than your having to take your car to the motor vehicle servicing business.

What this section of the bill does is transfer that responsibility. The question the motor traders quite rightly ask is: what is actually meant by unintended movement? What risk are they taking on? There are a couple of examples just to make it clear. The legislation is so clear on this point that the government has to introduce a couple of examples just to make it clear. I draw the attention of the house to clause 4 of the bill which amends section 99 of the Motor Vehicles Act. In particular, I am dealing with clause 4(6), which deals with section 99 and which inserts the examples. One example of a situation that would not be expected to fall within the ambit of this claim is:

death or bodily injury caused by or arising out of the unintended movement of a motor vehicle while the vehicle is being displayed, serviced, repaired, restored or equipped.

So we asked some questions of the advisers about this provision. For instance, if UltraTune comes to your business to service your car and they jack it up but the jack falls over and injures a kid, that is no longer covered by compulsory third-party insurance; it is going to be covered by someone else. If you are a car seller displaying a vehicle, you drive it down a public road, you get a flat tyre and you pull over and jack up the car but it falls off the jack and injures a pedestrian walking past on the public footpath, again, that is not going to be covered by compulsory third-party insurance: it is going to be transferred to the insurance of the company, if it has it.

It talks about the 'unintended movement of a vehicle while it is being serviced'. Crawford Motor Vehicles (CMV) on West Terrace now has a three-storey entity. I will seek clarification, but I am assuming that any vehicle inside that property is being serviced or displayed for business purposes and, therefore, any unintended movement that causes an accident in that particular premises now becomes a matter for Crawford's and not a matter for the compulsory third-party scheme.

This matter goes to a lot of issues for the Motor Trade Association businesses—those in the motor vehicle industry—and it is unfortunate that they were left out of the loop until the last minute. The Motor Trade Association has written a number of letters to the MAC. John Chapman, the executive director, wrote to the Motor Accident Commission about this bill on 4 November, and a copy was sent to the Treasurer's office. It states:

Thank you for the opportunity to discuss the various amendments of concern to the Motor Trade Association with this particular bill. Since the meeting in October, and having given consideration to the aspects discussed, there is one area of proposed changes to section 52(2)(a) that could have significant consequences when compared to the current CTP cover. This is the reference to 'exclusion from cover as a result of unintended vehicle movement while being serviced, displayed, restored or equipped'. We believe the definition of 'unintended' needs to be clarified.

As you are no doubt aware, there are many people who will service vehicles, registered, for family and friends at home. It would not be unheard of for a vehicle to slip off a jack or safety stand, injuring or even killing a person or persons working underneath the vehicle. If the homeowner does not have property insurance with a personal liability cover, it would appear that this proposed amendment will leave the victims without any form of insurance cover in respect to the event.

I would appreciate receiving a response from MAC on this scenario as a significant number of employees of our members would be obligated to work on family and friends' vehicles after hours. As a courtesy to both parties we would certainly wish to make people aware of the consequences should an accident occur.

Today, Mr Tuffnell, the General Manager, Corporate Affairs of MAC wrote back to Mr Chapman stating:

Thank you for your letter of 4 November concerning the Motor Vehicle (Third Party Insurance) Amendment Bill. The amendment in question is seeking to clarify the scope of compulsory third party insurance cover insofar as deciding what injuries or deaths were caused by or arising out of the use of a motor vehicle. Ultimately, this will exclude bodily injury or death being caused by the displacement of goods while a motor vehicle is being loaded or unloaded or as a result of unintended movement of a vehicle while being serviced, displayed, restored or equipped.

You note the situation of people who service vehicles at home being injured or killed as a result of vehicles slipping off a jack or a safety stand. As we have discussed with you and your representatives on 27 October, it is MAC's view that the CTP scheme was never intended to cover situations such as these and we believe that clarity is required.

The CTP scheme currently covers accidents which occur when a vehicle is being driven, runs out of control, or a person travelling on a road collides with a stationary vehicle.

It is our view the scenario you have presented does not fall within these parameters and as such coverage to the CTP scheme could not be extended. It should be noted that the proposed amendments are not changing the definition of 'caused by or arising out of the use of' but instead seek to provide guidance through the use of examples…

Yours sincerely, Ben Tuffnell.

That is the response from the government in relation to that issue. Unfortunately, we have not had formal responses from the board of the Motor Trade Association, the South Australian Road Transport Association, the Law Society or from the Lawyers Alliance. I regret not being able to bring their formal contributions to the house in relation to this matter.

An honourable member: Sorry; what was that last bit? Are you saying the Lawyers Alliance are now saying they weren't consulted?

The Hon. I.F. EVANS: No, I wrote to them. The member for Croydon suggests we should just ignore their views on a whole range of things. The two key issues for the opposition on this bill relate primarily to the two industry associations. Quite rightly, the parliament should listen and take the opportunity to hear what the two industry associations have to say. This chamber will be denied that, because the vote will happen in this chamber before those two associations formally respond.

The opposition is reserving its position. It does support some of the provisions in the bill and, subject to what the industry associations say, currently it opposes the two clauses that relate to the two matters I have raised on behalf of the two industry associations. If it were put to both houses tonight—which it will not be, of course—we would be voting against those two provisions on the basis that we have not heard the formal responses from the associations and we see no need to change the law until we have had those.

There are some other matters in the bill that the opposition does support. I want to touch very briefly on the two industry matters a bit further. The minister's advisers may be in earshot, and they can prepare their answers for the minister for the committee stage. I want to talk about the issue with the fatigue laws and the breach of the fatigue laws being a trigger for a recovery action by the MAC against those involved in the breach of the fatigue laws.

Those members new to the house may not be aware of the point that the South Australian Road Transport Association makes that, in the legislation that deals with the heavy vehicle fatigue laws, it is an automatic reverse onus of proof. The person being charged with the offence walks into the court guilty and then has to try and prove themselves innocent by what is known as a reasonable steps test.

In other words, did you, as manager of the business (or the consignee, the consignor, the warehouse manager or whatever position you may be), take reasonable steps to make sure the breach did not occur or tried to put in policies to prevent the breach occurring? There is a reasonable steps test. Some of the breaches or potential breaches of the fatigue laws go to the issue of paperwork; if you do not keep your paperwork properly, you have breached the law.

What this provision in the bill that we are now debating will essentially say is that, if you get charged with a breach of the heavy vehicle fatigue laws, there is a cost recovery against your insurance. It transfers the cost from compulsory third party to the business insurance. The issue then becomes what happens if the charge against you in the court, under the fatigue laws, is unsuccessful. If you are unsuccessful, under this particular bill MAC will still have a potential right of recovery.

To a layperson, it reads—and I will test this out in committee—that the government is having two bites of the same cherry; that is, they can charge someone under the fatigue laws, and the owner of the business, or the person being charged, may win their case in the court on the beyond reasonable doubt test (there will possibly be a criminal charge), and then, having paid all their costs in relation to that court matter, walk out of the court and MAC can say, 'Well, just because the court didn't find you guilty on that one, we are now going to run a civil case against you, and the burden of proof will be a lower burden of proof, it will be on the balance of probabilities, and you will be up for those court costs as well.'

I want to test that out on the committee; if I am wrong, I am happy for the government to tell me that I am wrong, but that is the way I read it. Potentially—and this is the South Australian Road Transport Association's problem, I suspect—I think anyone might accept the case where it is proven that the owner of the business was knowingly scheduling the driver for unrealistic time frames that were breaching the act. That is one level of breach. There is another level of breach: the owner did not fill out the paperwork, did not keep the records properly. It is still a breach.

The Road Transport Association is saying, 'Well, if it's the lower impact breach, are we really going to claim back against the owner of the business?' In this chamber, we know that mistakes are made with paperwork all the time. The Treasurer himself, his own agency, once issued a correction and once the Auditor-General picked up another correction. Mistakes happen with paperwork, and this legislation states that if you make a mistake on your paperwork you are potentially going to be lined up for a cost recovery down the track out of your own insurance, rather than the compulsory third-party scheme.

I think we should adjourn the debate at the end of the second reading so that the two industry associations can properly inform the debate through their submissions. On the Motor Trade Association issue of unintended movement of the vehicle, I will not push that matter any further now, other than to say that I will want to go to the committee stage so that I can ask the advisers exactly how this provision will work, because the unintended movement of the vehicle is interpretive. I think there are going to be a lot of court cases about what was unintended in relation to the movement of vehicles that may or may not cause injury to someone.

That is the suite of amendments. The opposition will want to go into committee and go through this bill clause by clause so that we can get some clarification for those industry groups we have mentioned and better inform the debate in the other place. As I say, the opposition does support some elements of the legislation. There are two principles in the legislation we have some concerns with. If it stays in its current form, in this house we will not be supporting those clauses. If the government proceeds with the vote today, we hope to be able to work with industry groups and the government between houses to try to resolve these particular issues. With those comments, I look forward to the debate.

Mr VENNING (Schubert) (11:55): I commend the member for Davenport for his very extensive appraisal of this bill, which certainly put our position very clearly. As members have heard, the bill is about third-party insurance and the government's intention, in its eyes, to improve the scheme. In particular, the government wants to ensure that nobody misses out on the benefits payable, especially genuinely injured road users.

I note what the member for Davenport said about the less than adequate consultation, especially with the RAA, the SA Road Transport Association and the Motor Trade Association, which is a bit regrettable. However, we have the bill here before the house. I think it has been a little rushed, and I am a bit concerned that we do not have the papers from these bodies. Again, as a person who, in the past, has not been altogether supportive of the upper house, I think the time between the houses could be used very advantageously to have this consultation and to have a final look at this legislation. The question is: why are we doing it today and in such a hurry? Is it because the government is running out of business, particularly after the hassle of last week, when the government ran out of business. Is that why it has been brought on today?

Mrs Geraghty interjecting:

Mr VENNING: The whip informs me that it is not, so it isn't—I will take the whip's word for that. The member for Davenport highlighted very clearly the nine areas of amendment the bill covers (and I will not go through them all). There are a couple I want to mainly pick on, particularly the hit-and-run-driver, an area we certainly support, and also people who are unregistered. If you happen to be unlucky enough to run into one of these unfortunate people, and I call them that advisedly or guardedly, your cover is put at some risk. However, under this legislation, your insurance covers right across this area.

I do not, though, support sections of the bill where it provides, in relation to these accidents, that you have 90 minutes to report the accident; that is too soon, especially in country regions. Often when there is an accident, you are the only one there, and no police officer would be able to get there within 90 minutes, let alone your being able to report the accident to them because the police station may be a couple of hours away. So, I am concerned that was ever considered for inclusion in the legislation. It is all very well for city people, but what about the people living north of Port Augusta? It is very impractical and it will not happen.

I also note in this legislation that MAC can take civil proceedings; it has only to prove the matters on the balance of probabilities. Again, the onus should not be that way: it should be the other way, especially in relation to drink and drunk driving, not stopping to assist and also, again, this 90 minute clause. Certainly, the opposition opposes this provision, as does the RAA.

Also, I have a strong interest in the heavy road transport industry, especially the legislation linking into the fatigue laws and putting responsibility on the owners or managers—and the member did list all of those. We do not support this provision and, again, I declare that I own trucks. You just trust your driver to be doing the right thing always, but sometimes they do not, unbeknownst to you. It is bad enough now with the new road laws in that, if a driver overloads his truck, the responsibility is with the owner of the truck, even though he did not load it. That is bad enough, and farmers are feeling the heat of that, but this bill is taking it even further, and I understand the opposition is not supporting this, either.

I cannot understand why the South Australian Road Transport Association was not just lobbied but also did not have briefings with the minister in relation to this issue because it certainly will vitally affect them big time, and it will bring a lot of other people into this, something of which I am very much aware.

Compulsory third-party insurance has generally worked very well over many years in South Australia, and farmers have appreciated the protection offered by this insurance. However, there has always been some conjecture about whether or not farmers on the road with tractors and farm machinery which had never been registered and therefore had no compulsory third-party insurance were at risk.

When I came into this parliament in 1990, it was an issue that I ran into early on, and when we got into government in 1993, I put it on the agenda. There was an incident back then where there was an accident on the road, MAC was the nominal defendant, a farmer had to argue his case in court, and the farmer's public risk policy didn't necessarily cover that accident. So, back in 1995, I began an investigation and eventually brought in section 25—Conditional registration, for farm machinery, purely to get this CTP cover, and now all farmers are fully covered by the CTP insurance.

There was some opposition to this because some of the farmers said, 'Why did you do this? We never had any problem. Why do we now have to register our tractors, because we've never had an accident in our lives?' But, sure as eggs, if an employee has an accident then you would be glad that the insurance cover is there, particularly now that insurance companies are being a bit dodgy with some of their policies and not quite clear on what they do cover and what they do not cover.

So, there was opposition to it, and I apologise to those farmers who thought that I went too far, but in hindsight I think we did the right thing. The protection is worth it, especially now that we have some insurance companies that categorise, or limit the cover of farmers under their public risk policies, the cover they relied on before CTP came in via farmer registrations. We always thought that we were covered, but in some cases this may not have been the case, and you do not really want it tested because in some cases these claims are $500,000, or even $1 million, where there is a fatality or long-term injury.

I also note that there is legislation coming to the house shortly on summary offences prescribed motor vehicles. That will be a debate for another day, but I would just note that it does come across this area because many farm bikes (ag bikes we call them) are not compliant for registration, for all sorts of reasons: tyres, mudguards, blinkers, horns, and, generally, because these bikes do not have compliance plates on them they are cheaper and most farmers run them on their farms. Most of these are now covered by this conditional registration which I have just spoken about for on-farm use only with this CTP cover.

It is a good scheme, but section 25—Conditional registration, has to be exempt from the new act that is coming in because farm bikes are not monkey bikes, and this is all about monkey bikes. I understand that the member for Light is one of the pushers of this legislation, but I defy anybody to tell me what the difference is between a monkey bike and a farm bike, or even, say, a Honda 80 or a Yamaha mini bike. There is little difference; you cannot differentiate. So, that will need to be clarified when that bill comes here, because neither of these categories are legally registrable.

Finally, I compliment the member for Davenport on a very sensitive speech and assessment of the situation here. At least he, through the Liberal Party, has tried to get some consultation going; it is just a shame that the minister did not do the same. Maybe the minister is a bit too busy, but I think that in this situation the South Australian Road Transport Association, particularly, would be quite horrified, as would the RAA, that this legislation was not put before them a long time ago so that they could have some input into it.

We appreciate the time between the houses, as I said, to allow this consultation to be properly administered with interest groups, and I certainly look forward to that. I commend again the member for Davenport, and with those amendments I understand that the opposition will support the bill.

Mr PEDERICK (Hammond) (12:04): Certainly, I acknowledge the extensive contribution of the member for Davenport on this bill, as well as the member for Schubert's contribution. I would just like to make some comments about a couple of the proposals that the Liberal Party is opposed to in this Motor Vehicles (Third Party Insurance) Amendment Bill.

The first one I want to discuss is the chain of responsibility in heavy road transport. As the member for Davenport rightly said, we have had this legislation in for a little while; and, if it is passed, you only need to have uncompleted paperwork and you could be breaking the law and fall under this legislation. The point of this amendment is to make it easier for the Motor Accident Commission to recover claim costs from people higher up the chain liable for putting pressure on truckies to breach driver fatigue related laws in the heavy vehicle industry.

There is some comment that currently there is limited opportunity to recover against persons within the chain of responsibility who are not otherwise insured under the compulsory third-party policy. It is envisaged that the persons who will fall within the chain of responsibility as specified in the regulations will include the employer, the prime contractor, the operator, the scheduler, the consigner, the consignee, the loading manager, the loader, and the unloader.

What we could have here is quite a list of people who may do something very small, such as even forgetting to do a bit of paperwork halfway through that chain, and, on a technicality, breach the new amendment. If this amendment does go through, it will include a right to recover from those persons or anyone who has had anything to do with the chain of responsibility. As the bill states, it can recover from those persons who have aided, abetted, counselled, procured, induced or been knowingly concerned in, or a party to, the commission of an offence against the Road Traffic (Heavy Vehicle Driver Fatigue) Regulations 2008, for example, driving whilst fatigued and failing to comply with the driving hours.

As I indicated earlier in my contribution, the amendment intends to encapsulate anyone who has placed pressure on a driver to undertake illegal activities and who is about control, not necessarily the employment relationship. The right of recovery is linked to the heavy vehicle driver fatigue regulations that were enacted in South Australia in 2008. The trigger point for recovery is the commission of an offence pursuant to the Road Traffic (Heavy Vehicle Driver Fatigue) Regulations. Regulation 6 creates an offence to drive a regulated heavy vehicle if the driver is impaired by fatigue.

However, the regulations also create offences for the parties in the chain of responsibility in relation to a regulated heavy vehicle if they do not take all reasonable steps to ensure that a driver of the vehicle does not contravene regulation 6. I note that the introduction of a right of recovery in this scheme is intended not only to recoup costs but also to create a further deterrent to the commission of these offences.

The right of recovery proposed for these parties is limited to the amount a court thinks is just and equitable as a stopgap measure to ensure fairness in relation to the imposition of any liability. I note that we will be monitoring this through the committee stage to see where we are going with this, but I think that it is correct that the Liberal Party (and it is the right move) will not support this amendment.

The other amendment I want to discuss is amendment No. 9, the meaning of the expression 'caused by or arising out of the use of' a motor vehicle. The Motor Vehicles Act is to be amended to maintain the parameters which define the scope of the compulsory third-party cover in so far as deciding what injuries or death were caused by or arose out of the use of a motor vehicle. This will exclude bodily injury or death being caused by the displacement of goods while a motor vehicle is being loaded or unloaded, or as a result of the unintended movement of a vehicle whilst being serviced, displayed, restored or equipped.

This amendment could impact on not just hundreds but many thousands of South Australians who will not even know of its existence (if it is passed) before they get a notice in the mail that they could be up for significant costs if they do not have the appropriate extra insurance cover. I note that we oppose this amendment as well on this side of the house and will be investigating it through committee. With those few words, they are my comments on the bill.

The Hon. K.O. FOLEY (Port Adelaide—Deputy Premier, Treasurer, Minister for Federal/State Relations, Minister for Defence Industries) (12:11): This bill has been a long time in preparation. I note that the first ministerial approval for these amendments to be discussed with industry go back to January 2007. I am told that some of these amendments have been discussed with industry over a period as long ago as 10 years. We should also understand from the backdrop of this that the Motor Accident Commission is a statutory authority and held in government ownership, which this government has no intention of changing.

We should remember that, because it is a government-owned insurance business under statute and is not operating as a free market insurance company, it always has pressures on it in terms of delivering decent premium outcomes with decent benefits. If the Motor Accident Commission of the day was operating in the private sector, the premiums I guess would be much higher. I accept the argument that, for a reason I cannot fathom, the MTA was not consulted on this. I am happy to adjourn the bill at the end of the second reading. In my dealings with Steve Shearer I have always found that one should be very careful in believing everything Mr Shearer tells you.

Mr Venning: That's a bit harsh.

The Hon. K.O. FOLEY: You think? It took me forever to get it, but I am not sure whether I have more coming. When I looked at the cabinet submission and at the correspondence, guess what? SARTA has been consulted. In fact, I am happy to read an email into Hansard dated Tuesday 4 March 2008. I accept that this has been a long time coming, as these things are, but the situation has not changed. We must always look at ways in which we can maintain a viable Motor Accident Commission by continuous reform and continuous adjusting of the scheme. The letter begins, 'Hi Ben' (it is to Ben Tuffnell, head of Corporate Affairs), and states:

I have consulted the SARTA board on the proposals in attachment 2 and offer the following comments: SARTA supports what we understand the intention of the MAC proposed amendment to be, but we ask that the MAC satisfy itself before proceeding that the amendment would not have the effect of holding an employer liable for recovery.

It then goes into further discussion and states:

1. The employer has not been found guilty of a breach under the heavy vehicle driving hours laws or any other heavy vehicle compliance and enforcement chain of responsibility laws; or

2. Where the employer, who was knowingly involved in the breach through their acts or omissions we recommend that all parties covered by the compliance and enforcement change of responsibilities and not just the employer should be held equally accountable and liable for recovery by the MAC. This includes the consigners, loaders, packer and consignees, etc., as defined in the C and E laws. We also recommend that, rather than use a completely different set of words to describe the failures of the liable parties, we should adopt the wording of the C and E laws, which refer to the action, inactions and omissions of the parties, rather than aided, abetted, counselled, procured or induced, as proposed by the MAC draft. This would significantly assist in linking the C and E laws with MAC recovery.

I think that says it all. I am told I had other correspondence, but it seems difficult to get it for some reason.

The Hon. I.F. Evans interjecting:

The Hon. K.O. FOLEY: I think we had some later letters from SARTA in relation to this bill, so I am not saying we necessarily agree with Mr Shearer, but he cannot and should not have informed the opposition that the government failed to consult or—

The Hon. I.F. Evans interjecting:

The Hon. K.O. FOLEY: Well, that is dated March 2008—that is two years, a bit over 2½ years. This bill has taken a long time to come through because of various factors in moving this legislation forward, but it is wrong of Mr Shearer to say that he has not been consulted for over four years because that is just not true. I do not know why Mr Shearer would say that, but then, as I have said, there have been many times in my experience when I have wondered why Mr Shearer has said the things he has.

I am happy to adjourn this legislation to allow the proper consultation with the MTA to occur. As I said, it would seem pretty obvious to me that you would consult the MTA, so on that point I agree with the opposition.

Bill read a second time.

Committee Stage

In committee.

Clause 1.

Progress reported; committee to sit again.

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