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Legislative Council - Fifty-First Parliament, Third Session (51-3)
2009-04-08 Daily Xml
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STATUTES AMENDMENT AND REPEAL (FAIR TRADING) BILL

Second Reading

Adjourned debate on second reading (resumed on motion).

(Continued from page 1898.)

The Hon. R.D. LAWSON (20:08): I will be supporting the second reading of this bill and, subject to an important amendment, I will be supporting the passage of this amended bill. There is significant background to some of the issues in this bill and, in particular, those relating to recreational services. I propose to limit my comments on the bill to those of its provisions that deal with recreational services.

In 2002, as a result of the so-called insurance crisis at that time, and following the recommendations of the Ipp report, legislation in the commonwealth parliament and all state parliaments was changed. Prior to that time, the supplier of recreational services owed a duty of care to all users of those services and, if the supplier of those services was in any way negligent or in breach of contract, the supplier was liable in damages to the person injured. However, it was then claimed that recreational service providers would not be able to obtain insurance cover unless that law was modified, and it was modified. For example, in South Australia we passed the Recreational Services (Limitation of Liability) Act of 2002. Section 7 of that act, which is currently in operation, provides that, if a consumer of recreational services—and I will not go into the definition—suffers personal injury, the provider of those services is 'only liable in damages if the consumer establishes that a failure to comply with a registered code caused or contributed to the injury'.

The act provided for the establishment of so-called registered codes, which were to set out the standards which the suppliers of recreational services were required to meet; standards such as training provisions for staff members, the safety of equipment compliance with occupational health and safety regulations and such other matters as might be appropriate to the particular activity. This scheme was fine in principle, but in practice it was extremely difficult and, despite the attempts of a number, only one company or organisation we are told could obtain a registered code, notwithstanding that some had tried hard to do so.

That may have been difficult because of the restrictions or difficulties imposed by the minister who had to improve the code (I am not laying any blame there). There may have been a difficulty because it was an absolutely new and a novel provision. I know, for example, that a business called Swimming with the Dolphins that operates in Baird Bay on the West Coast sought to get a code and I think may have received a code as a private business, but the sports organisations and groups, apart from one, were unable to obtain a code. So, the scheme did not work.

South Australia entered into that scheme full of hope and expectation that it would work, that it struck a fair balance between the rights of consumers to have appropriate safeguards and the rights of business operators and sports associations to conduct their activities effectively. This scheme adopted in South Australia was not adopted in any other state or in the commonwealth parliament.

It is proposed in this bill that the Recreational Services (Limitation of Liability) Act of 2002 be repealed, and I certainly support its repeal. It has not been an effective measure and it has not achieved any of its objectives. The question then becomes: what has to be put in its place? Should we return to the position that prevailed prior to the introduction of any of these laws? Should it simply be left to contract between the parties, so that recreational service providers can put whatever terms they like in a contract and that contract will be enforced against the user? That would be one solution, but one of the difficulties about that solution is that it does not address the rights or interests of minors who are unable to enter into binding contracts, except in circumstances which do not really apply here. Or, should we adopt some other scheme?

What the government has chosen to do with this bill is to adopt another scheme. It is basically the scheme that has been adopted, first, in the commonwealth but more recently in the Victorian parliament. There is another model that is reflected in the New South Wales Civil Liability Act, but the government has not chosen to pursue that particular route.

However, this bill does contain a significant difference from the Victorian legislation, and that particular difference has given rise to a great deal of agitation and concern in the community, concern which I must say is justified. The amendment of which I spoke in my opening remarks is to remove a particular provision of this bill which makes it different to that which applies in Victoria.

I mention the Victorian legislation so that members have some understanding of where I am coming from in relation to this. The Victorian legislation is, in fact, contained within the provisions of the Fair Trading Act of that state. Section 32N of that act is headed 'Limitation of liability in relation to the supply of recreational services.'

The Victorian legislation contains a provision which implies in every contract for the supply of services, including recreational services, a term whereby the services will be fit for the purpose and that due care will be used in the provision of those services. That is a general provision that applies to all services, whether it is the services provided by a plumber, an electrician or a builder. Although in Victoria there are some particular provisions relating to services provided by qualified architects or engineers, it is unnecessary to examine those.

Generally speaking, if you supply services you are required to meet the warranty, and the act provides that, if there is any term in the contract by which the supplier seeks to exclude, modify or restrict liability, that provision is void. However, a special provision applies in relation to contracts for the supply of recreational services.

There are circumstances in which a supplier, in Victoria, can exclude liability, but they are limited. One of the important limitations is that a supplier cannot exempt himself or herself from a reckless conduct. The act provides, in section 32(3)(b):

The act or omission was done or admitted to be done with reckless disregard or without consciousness for the consequences of the act or omission.

So, in Victoria there is a limitation on the capacity of the supply of a recreational service to reduce or exclude liability.

The Victorian provision applies only to contracts. It, therefore, applies only to dealings between suppliers and adults or persons of full legal capacity. The act is quite silent on the question of whether a child can have their liability excluded or modified by one of these terms. The fact is that a child cannot, at common law, because (a) a child cannot contract and (b) apart from what are termed 'necessaries' someone cannot enter into a contract on their behalf. So, the position in Victoria in relation to children is that the common law has not been modified. A child who is injured as a result of a negligent act of a recreational service provider is entitled to recover damages, if damages are suffered.

In the commonwealth parliament, a similar model was adopted in relation to this question. Section 74 of the Trade Practices Act provides that all services provided by a corporation in trade or commerce carry with them an implied warranty that the services will be rendered with due care. Section 68 of the Trade Practices Act provides that the warranty cannot be excluded. However, section 68B was inserted in 2002 to allow a special exemption in relation to the supply of recreational services. It provides that the service provider can exclude, restrict or modify liability so long as the exclusion, restriction or modification is limited to liability for death or personal injury and that it related to the supply of recreational services.

The act is entirely silent on the question of the rights of infants, with the common law right—namely, the right not to have one's capacity to recover compensation for injuries—removed. In New South Wales, a somewhat different model was adopted. In that state, the provisions of the Civil Liability Act were changed; some, erroneously in my view, suggest that that the model adopted in that state would provide a better scheme than that now proposed by the government.

In New South Wales, the Civil Liability Act was amended in 2002. Section 5M provides that there is no duty of care for recreational activities if there is a risk warning and that a service provider does not even owe a duty of care to another person to take any care in respect of the person if the risk is the subject of a risk warning. It also provides that if a person is a minor, and is unable to contract but is accompanied by an adult, parent or guardian, the risk warning can be given to the parent.

The significance of this is not that it is waiver—it is not at all a waiver—it is just the fact that a risk warning can be presented and that no duty of care arises in such a case. Section 5L of that act also provides that there is 'no liability for harm suffered from obvious risks of dangerous recreational activities'. So, on the one hand, no duty of care arises but, when one goes to section 5N, one finds a special provision about waiver, as follows:

Despite any other written or unwritten law, a term of a contract for the supply of recreation services may exclude, restrict or modify any liability to which this Division applies.

That is a very wide-ranging contractual provision about waivers and, of course, it does not apply to persons who do not have contractual capacity. It does not apply to the contract that a minor might enter into when it engages recreational services and engages in them. Whilst the position in New South Wales is that there is no duty of care at all in relation to activities where there is a risk warning, the cases suggest that the courts do not give the recreational services providers the break that that might suggest.

For example, in the most recent case decided and reported on this subject, an adult who was a user of a gymnasium engaging in an exercise known as lunging had previously signed a waiver saying that, despite anything, the customer would not sue for negligence. The court held that, in effect, the waiver was not worth the paper it was written on.

I think a number of New South Wales cases illustrate the resistance of the courts to waivers and their desire to interpret them or to interpret the legislation in a way that alters the pre-existing common law to the minimum possible extent. I should mention a couple of those cases.

For example, in the case of Smith against Perese, decided in 2005, the claimant was a person on a spearfishing expedition and was badly injured when the boat on which they were travelling drove over him. His leg had to be amputated. There was a disclaimer of liability from the provider. The judge allowed the claim and held that spearfishing was not a dangerous recreational activity and, furthermore, that the risk of being run over by a boat when spearfishing was not an obvious risk. In other words, the provider was liable.

In the case of Dederer against the Roads and Traffic Authority, also decided in 2005, a 14 year old boy dived off a bridge despite a 'No diving' sign and suffered paraplegia. He had seen others diving off the bridge. The judge held that the risk of being injured by hitting the bottom was not an obvious risk. Once again, the plaintiff succeeded. In the case of Edwards against Consolidated Broken Hill, also decided in 2005, it was held by the court that cycling was not a dangerous recreational activity and that the Civil Liabilities Act did not apply.

I mention those cases not because they are directly relevant to the question of waivers, but because I think they illustrate the approach of the court to these questions. They are difficult questions. Is cycling a dangerous recreational activity? Most would regard cycling on main roads as something that is dangerous, especially when conducted by young persons and children, but it depends very much on the circumstances.

I have received—as, I am sure, have other members—a large amount of correspondence in relation to this bill and, in particular, to the fact that it contains an explicit provision that recreational service providers are not permitted to obtain a waiver from or on behalf of a child. This provision is found within section 74I. Proposed section 74H of the South Australian Fair Trading Act (which is now to be modelled, more or less, on the Victorian and commonwealth models) will provide that the warranty of due care and skill will be implied into a contract for recreational services, whatever the contract says. In other words, the law will insert those warranties into the contract.

Section 74I makes a special exemption in relation to recreational services. It says that an adult can exclude, restrict or modify the liability of the supplier for personal injury. It goes on, however, to say that such an exclusion cannot extend to injuries suffered as a result of the recklessness of the provider. It also provides explicitly that a waiver of rights by or on behalf of an infant is ineffective.

Section 74I(3) will stipulate that this provision does not exclude, restrict or modify the liability of a supplier for significant personal injury suffered by the consumer or any third party consumer if it is established that reckless conduct of the supplier caused the injury. Section 74I(2)(b) provides that the consumer and any third party consumer are each of full age and legal capacity.

The question then arises as to whether or not the law of South Australia ought allow parents to give a waiver in respect of the negligent performance of services. I do believe in parental responsibility and I do believe that the law ought to respect the significant rights and duties of parents. I accept that as a general proposition parents should exercise proper parental responsibility when allowing their children to engage in any activity, especially dangerous activities. This is not a one-size-fits-all situation. There are vastly differing circumstances. What might be suitable for a 16 year old may be highly unsuitable for a child aged eight. What might be perfectly suitable for a 12 year old of average intelligence and physical capacity may be entirely unsuitable for a child with disabilities. So parents have to make judgments about whether activities are appropriate, and that is an important responsibility.

The question here is not whether parents should allow their children to undergo activities—and I must say that, obviously, my wife and I have allowed our children to engage in adventure activities, to go mountain climbing, to go on bike hikes and other activities where the possibility of injury is ever present, and any responsible parent does the same thing. The question here is whether I, as a responsible parent, should say on behalf of my child, 'If that child is injured, perhaps made a paraplegic or a quadriplegic as a result of the negligence of another, I have the right to take away from that child the right that it enjoys—with every other citizen—to be compensated if it is injured by the negligence of another.'

I do not believe that parents have that right. That, in my view, is a bridge too far—in fact, far too far. A lot of legislation that we address requires us to strike a balance between competing interests. Now, what are the competing interests here in relation to this question of waivers? On the one hand there is the interest of business and organisations to conduct their activities and to obtain insurance to enable them to do that, and insurance at a competitive rate. They want to conduct their activities, which may be socially beneficial. If it is a business for profit, they actually want to make a living. So, that is one side of the ledger that we are balancing.

On the other side of this ledger is the legal right, which the common law grants to every citizen, for redress from a person who is negligent and whose negligence results in their suffering injuries. The injuries might be minor, it might be a bruise or a broken arm, and there might be little monetary compensation. In fact, under our more stringent laws these days there may be no compensation at all because we now have both limits and caps in relation to what is recoverable. They might be minor on the one hand, but they can also be permanent, serious and quite devastating.

The idea that someone, any parent, would actually sign away their child's rights, something which is the parents to give but which is the child's right, is certainly obnoxious to the common law and it is obnoxious to every principle of law of which I am aware. If it is a question of balancing between the right of a business to conduct an adventure activity and the right of an injured child to recover compensation, I believe the balance must be very strongly in favour of the child ahead of the business.

There are misconceptions about these things. Very often children who are seriously injured do not make a claim because their symptoms do not settle for many years. They have in our law until they are three years past their 18th birthday to make a claim. Some child injured at the age of five by the loss of a leg does not have to make a claim for, maybe, 18 or 19 years, by which time their circumstances might well have changed. Imagine the disappointment of that child when consulting a solicitor about the fact that he is unable to get any employment, when the solicitor says, 'Well, I'm sorry son, but your parents foolishly signed away for all time your right to make any claim.' I do not believe that anyone would accept that.

Sometimes people say, 'Well, a parent is actually able to sign a consent to medical treatment, and if they are able to sign a consent to medical treatment which might involve a life threatening operation, surely they must be able to consent to waive the child's right to compensation for damage.' However, these are two entirely different things. On the one hand, there is a consent—a consent to perform some medical service that is clearly in the child's best interests. That is one thing—a consent to do something that is in the child's best interests—but how can it be in the child's best interests to sign not only a consent but also a waiver?

The consent might say, 'I consent to Dr X operating on my child. Here is the consent,' but it is another thing then to add the clause stating, 'And, Dr X, I hold you harmless for any negligence that you might commit. If you leave a swab in the child after operating on it and it suffers septicaemia, I have signed away its rights. If you forget to apply the anaesthetic appropriately and it suffers permanent brain damage, I waived its rights ever to claim any compensation.' The difference between a waiver and consent is that a consent is only valid to do something that is in the child's best interests, but a waiver is not actually to do something that is in the child's best interests. It can be against the child's interests, and invariably it would be against the child's interests to sign away its rights to be injured as a result of the negligence of another person. Bear in mind that we are only talking about negligent people here. No liability arises at all if the service provider is not negligent.

One of the important issues is the question of insurance. I believe—and everyone here believes, I am sure—that children ought to be able to engage in activity, some of which will be dangerous. We would all agree that service providers should not be negligent and certainly not reckless as to the safety of the children. There are cases, and plenty of them, in the books. Let us take horseriding. We have all received submissions from people associated with the horseriding industry—a great activity. However, there are cases of situations where a child has been given an unsuitable mount, a horse that bolted the previous three days running and threw other people to the ground, yet was given to a novice rider.

The Hon. A. Bressington interjecting:

The Hon. R.D. LAWSON: There are a number of cases in the books and countless others would have been settled. It is not so common that you expect it to arise every week, but those cases do arise, and we have to face up to the fact that they will arise. It is entirely understandable that they do arise. The proprietor of the business might be the most careful person in the world, but they might be away or there might be some new staff member. All sorts of difficulties can arise. Fortunately, on most occasions, serious injuries do not inure, but sometimes they do.

A number of the objections that have been raised in relation to the bill, I believe, are misconceived. I might mention a couple of them. The Australian Lawyers Alliance (previously called the Plaintiff Lawyers Association) has put in a helpful submission, and I thank them for it. The Australian Lawyers Alliance does not believe that the common law of negligence ought ever have been changed. That is their strong position because they believe that the laws have been changed to restrict plaintiffs' rights—and, as their name suggests, their very purpose is to support plaintiffs. As the recreational services act, the Civil Liability Act, this bill, and every other piece of legislation that has been passed since 2002 has the effect of restricting, to some extent, a plaintiff's rights—this particular bill does because, as I said, it allows adults to waive their rights, as it ought—the Australian Lawyers Alliance does not approve it. It says:

That the legislation at both a state level and a federal level is extremely disadvantageous to those who are injured in the course of recreational pursuits.

The alliance is not interested in giving protection to recreational service providers; quite the contrary. Its brief is to ensure that injured persons recover more compensation than they do under our current law. It says:

That the law of negligence would adequately cover the situation of recreational services providers as it did prior to the Ipp reforms.

The alliance also says:

It is completely unfair that the commonwealth act excludes essentially all claims for personal injuries arising from recreational services which obviously negates the need for insurance in relation to them.

I come at this problem from a different perspective. I believe we do have to balance the rights of plaintiffs and defendants, and this legislation does create a balance.

I turn now to the Insurance Council of Australia. It has been said that the legislation, which we have modelled on the Victorian legislation, will lead to insurance difficulties. Well, it has not in Victoria to any demonstrable extent, nor has it in other states. The insurance council, representing insurers, says, in an email sent by Rowena Gilbertson of the Insurance Council of Australia in Sydney:

The insurance council and our members support the government's proposal to repeal the act and insert provisions in the Fair Trading Act which are similar to the provisions in other civil liability legislation across Australia. However, section 74I(2) of the bill specifically precludes a parent or guardian from providing a waiver on behalf of a child, thereby creating unlimited liability to recreational service providers for injuries suffered by children. Section 74I(2) is not reflected in civil liability legislation in other...jurisdictions.

Our members report that the likely effect of section 74I(2)...if enacted, is to see a significant increase in the price of public liability insurance for providers of recreational services to children and the potential for some insurers to withdraw from this market. This appears to be at odds with our understanding of the bill, which is to promote the availability of insurance for recreational service providers in South Australia.

If, as the insurance council says on behalf of its members, this particular clause will create an insurance difficulty in South Australia, I believe that the clause ought to be removed. As they point out, it is not reflected in the civil liability legislation of any other Australian jurisdiction, and I cannot see why it should be included here, especially if the effect of its inclusion will mean that recreational service providers will not be able to obtain insurance, or not obtain insurance at the same rates as those enjoyed by those elsewhere. I believe that the removal of that particular clause from the legislation will substantially address the concerns of those who are worried about the effect of this legislation.

My attention was drawn—and I imagine it was also drawn to others by Ms Sarita Stratton, who is engaged in the horse industry—to a number of issues, one of which was the suggestion that the inclusion of the word 'reckless' in the exclusion would put insurance at risk. She quotes a provision from the policy of Affinity Insurance Brokers/Liberty International Underwriters as follows:

This Policy does not cover liability directly or indirectly caused by, arising out of or in any way connected with...any alleged or actual fraudulent, dishonest, malicious, wilful or criminal act or omission of the Insured or any person covered by...this Policy.

Some have suggested (I cannot believe seriously) that this exclusion, which is a standard exclusion not only in public liability insurance policies but also in many other forms of risk insurance, covers reckless conduct. It does not cover reckless conduct or negligent conduct because it simply does not say that. It talks about fraudulent, dishonest, malicious, wilful criminal acts, which are quite different from reckless or negligent acts.

If an exclusion of this kind which, when read strictly, is to apply to reckless acts, the insurance company would be required to include a specific exclusion to that effect because recklessness, which is a more serious degree of negligence, is not of the same species of wrong as fraud, dishonesty and criminal behaviour. I believe that particular contention was something of a red herring, and I am happy to bury it.

Another claim that has been made in relation to this legislation is that waivers are already included in the terms and conditions of entry for many activities. Ms Stratton provided me with the terms and conditions of entry for the 2009 Skoda Breakaway Series. It contains a purported release. As one would expect, these types of entries have always included releases and, in relation to adults, they may have some effect. In fact, they rarely do, but they may have some effect and they are included, just as when you see a sign on a car park which says 'Enter at own risk', practically every car park says that.

What does that mean? Is that a risk warning? Is that a waiver? No. The effect of it would depend upon the circumstances, and the car park owner who puts up a sign which says 'Enter at own risk'—which does not apply, for example, to an infant or a child—commits no crime or civil wrong by simply posting that notice any more than does the conductor of an event like the Breakaway Series commit any wrong or engage in any misleading or improper conduct by simply inserting a standard form of consent, waiver and indemnity. I believe that the suggestions made that, for some reason, some illegality is being conducted by the organiser of these events are wrong.

It is true, however, that, if this bill were passed in unamended form without the removal of section 74I(2), there could be a suggestion that the organisers were directly flouting the law which specifically provides that a waiver may not be given on behalf of an infant. It is for that reason that I believe those provisions ought be removed. I urge the government to accept the suggestion made by the Insurance Council that it be removed, and we certainly will have an amendment to that effect.

Yet another objection raised to this bill is the fact that the discussion paper issued by the minister's department in relation to this matter stated that there would be no exclusion for conduct which amounted to gross negligence. What we now find in the bill as drafted is that the expression 'gross negligence' is not used, but the exclusion applies to reckless conduct.

The suggestion that the word 'reckless' is somehow or other unknown to the law in relation to claims is something I reject. First, recklessness is a matter of a dictionary definition. There have been a number of court decisions which establish a meaning for 'reckless' in particular circumstances. The inclusion of a term such as 'reckless' does not invite litigation any more than the inclusion of the term 'gross negligence' would invite litigation. For example, in 1954, Justice Devlin (or Lord Devlin, as he later became) said in a case, Reed and Company versus London and Rochester Trading:

The term 'recklessly', I think, does not really give rise to much difficulty. It means something more than mere negligence or inadvertence. I think it means deliberately running an unjustifiable risk. There is not anything necessarily criminal, or even morally culpable, about running an unjustifiable risk; it depends in relation to what risk is run; it may be a big matter or it may be a small matter.

Yet another judge, a famous English judge, Justice Megaw, in a case decided in 1961, Shawinigan versus Vokins, said:

In my view, 'recklessly' means grossly careless. Recklessness is gross carelessness—the doing of something which, in fact, involves a risk, whether the doer realises it or not; and the risk being such having regard to all the circumstances, that the taking of the risk would be described as 'reckless'.

He later said:

Each case has to be reviewed on its own particular facts...my understanding of the ordinary meaning of the word is high degree of carelessness...Would a reasonable man, knowing all the facts and circumstances which the doer of the act knew or ought to have known, describe the act as 'reckless' in the ordinary meaning of that word in ordinary speech?

So, I do not believe the inclusion in the bill of the expression 'reckless', notwithstanding the fact that it is not the word that was used in the discussion paper, is of any great significance. I think it is appropriate that there be no possibility of exclusion for reckless conduct. Recklessness might be the same as gross negligence; I do not really enter into that debate. I do not believe that the expression 'gross negligence' would be appropriate to include in legislation. It has overtones of moral culpability, which is inappropriate in modern statute.

I am somewhat concerned, however, and I ask the minister to comment on the expression 'significant injury'. Section 74I(3) provides that a warranty cannot exclude liability where a person suffers significant injury through reckless conduct. There is no definition of 'significant injury', and I agree with the comments made by Mr John Daenke (solicitor) in a helpful paper referred to earlier by my colleague the Hon. Michelle Lensink. Mr Daenke correctly notes that the term is vague and uncertain, and there would have to be a court case to determine its meaning. I think we could usefully avoid those consequences by having a definition. The one suggested by Mr Daenke relates to provisions of the Civil Liability Act, in particular section 52 of that act, which actually prescribes various monetary standards which could usefully be adopted.

I commend Mr Daenke on his paper. It is a sensible and reasoned commentary on the legislation. Nothing he says, however, directly contradicts anything that I have suggested in relation to minors. Indeed, he is fairly silent on that subject, merely mentioning the fact that at common law it is not possible to waive the rights of the child.

Mr Daenke raises the question about whether or not these amendments would make any significant difference to the availability or affordability of insurance. It appears that he was not given the same information that we have been given by the Insurance Council of Australia in relation to that matter. Some might say it would be appropriate to go to insurance companies to see if they will give us assurances about the availability and cost of insurance. I believe that that would be a futile exercise. They would say that their capacity to make insurance available depends upon all sorts of factors and that the cost at which that insurance is available also depends upon factors like claims history and the like. I doubt that they will go beyond what the Insurance Council itself has said, namely, that they are perfectly happy with the system that prevails elsewhere. They suggest that we should adopt that, and that the amendment to which I have referred should be passed.

I ask the minister to indicate why the government has not chosen to include a definition of 'significant injury'. I note the suggestion by some that the bill should perhaps go to a committee, but I doubt that that is necessary. We do not ordinarily send bills to a committee. I note that some of the information provided by Miss Stratton and others suggests that, in order to defeat the bill, we ought to delay it. I do not believe that we should either defeat or delay it. I doubt that an inquiry by a select committee would reach any different conclusion to the matters that have been raised in this debate.

I should also add that I have had discussions with persons in significant positions within the scouting movement. I understand entirely the concerns that the Scouts have. I myself am a former Boy Scout, and I do believe that the Scouts and other organisations like the Scouts provide an invaluable service to our community; they are providing it at the moment. However, I think the real concern of the Scouts movement is that, in the future, insurance might not be available for certain activities. It has not yet happened in other jurisdictions, and I cannot see any reason why it necessarily should, so I do not believe that the their concerns should be addressed by insisting that the rights of infants be sacrificed.

If my children were to go to the Scouts I would be very happy to sign consent forms, but I would not, and I do not believe any responsible parent would, sign a blank cheque and say, 'If you are negligent and if you cause injury to my child, on behalf of that child, I will waive the child's right to receive compensation for all time.' As I say: a bridge too far.

The Hon. A. BRESSINGTON (21:07): I rise to indicate that I also support the second reading of this bill and, depending on amendments, I would also support the passage of the bill. The Statutes Amendment and Repeal (Fair Trading) Bill, introduced by the Minister for Business and Consumer Affairs in November last year, proposes several changes to the regulation of business and consumer affairs in the state. Notably, there are increased penalties for breaching the Fair Trading Act, expanded powers of investigation for authorised officers, and increased powers for the commissioner to temporarily suspend some traders' licences.

Just on the latter, it is often a point of frustration that the dodgy dealers or builders exposed on programs such as A Current Affair and Today Tonight are still able to continue trading long after the show has gone to air. It is hoped that the new provision permitting the commissioner to suspend the licence of certain traders prior to the completion of disciplinary proceedings, which often occurs long after the traders' offending, will lead to proactive consumer protection.

On my understanding, many of the remaining provisions are simply codification of the present common law of contractual relations between supplier and consumer. I know this is an issue that sparks much emotion amongst members in this place, not to mention the legal fraternity, and these are issues that we will be working through during the committee stage.

I will focus on what I believe to be the main point of contention among ordinary South Australians, involving the repeal of the Recreational Services (Limitation of Liability) Act 2002 and its proposed replacement, section 74I. Prior to looking at the proposed solution, I would like to first turn to the problem as we find it.

This problem has its roots in the so-called public liability crisis at the start of this decade. As occurred in the '70s and '80s, insurance providers began increasing the premiums or withdrawing public liability insurance coverage nationally, particularly for those activities involving inherent risk, such as contact sport and horse riding. Examples of severe spikes in premiums and service providers lamenting their inability to procure public liability insurance frequently appeared in the media, both nationally and here in South Australia.

The cause of the crisis has been the subject of much speculation, with two distinct schools of thought emerging. One argues that a mix of global and domestic economic conditions, including the collapse of HIH Insurance and poor investment practices by insurance providers, led them to attempt to recoup losses and avert risk.

This school of thought proceeds on the premise that insurance providers are primarily orientated towards investment and, as such, any market turbulence will affect profit margins. Put forward by insurance providers and supported by some in the legal profession, the other dominant argument attributed to the crisis is to the significant yet steady increase in the total cost of claims in the years prior which had not been reflected until then in premiums paid.

This argument was given credence by the Australian Competition and Consumer Commission which, in the first of many monitoring reports, detailed a 75 per cent increase in the average cost of claims settled between 1997 and 2002, with the average duration of time taken for claims to settle also increasing 34 per cent in roughly the same period. While in hindsight it is hard to ignore the influence of the economic conditions, especially the collapse of HIH Insurance, it seems that insurance providers impressed upon state and federal governments the need for reform of liability of recreational service providers and personal injury more broadly.

From research undertaken I believe the first significant response came from the ministerial meeting on public liability insurance, which commissioned the Hon. Justice David Ipp (formerly of the Western Australian Supreme Court) and others to thoroughly investigate tort liability and possible reforms. The subsequent report entitled 'Review of law of negligence: final report', known as the Ipp report and also referred to by the Hon. Rob Lawson, proposed several reforms to tort law generally, many of which have now been incorporated into the Civil Liability Act.

This government, like its interstate counterparts, also moved to limit the liability of recreational service providers and, hence, increase their ability to procure public liability insurance and reduce the premiums they pay by the introduction of the Recreational Services (Limitation of Liability) Act 2002. For limitation of liability under this act a recreational service provider is required to draft and submit a safety code which, provided it is accepted by the Office of Consumer and Business Affairs, the minister and parliament, would then limit their liability to injuries arising out of conduct outside of that permitted by that code. Notably, this act limited the legitimacy of signed waivers to those issued by recreational service providers who have a registered safety code.

From my understanding, the concept underlying this act was a point of great pride for the government in 2002. However, in operation the reality is that, six years on, only one safety code has been registered, submitted by the Miniature Horse Society at a cost of $35,000, which I have had confirmed. The Miniature Horse Society is the only provider of recreational activities in South Australia protected by the 2002 act. I would also like to know—and the minister can answer this in the committee stage—what recourse the Miniature Horse Society has now to regain the $35,000 expended on the presumption that the 2002 act was what they were stuck with and that they had best make the most of it by submitting a code. As one can imagine, they are hardly an affluent organisation and the commitment of this money was a significant drain on its frugal savings. Now, six years on, it was all for nothing. Will the government reimburse the Miniature Horse Society for funds wasted through no fault of its own?

As was highlighted by the Hon. Iain Evans when introducing the private member's Civil Liability (Recreational Services) Amendment Bill 2008, the fact that only one code has been registered is not solely the fault of service providers. Five other providers submitted codes to the Office of Business and Consumer Affairs only to have them sat on for years. It cost the each of the aforementioned organisations that submitted codes (so Iain Evans informed the house in the other place) about $7,700. I have been informed that, in total, nine codes have been submitted to the Office of Business and Consumer Affairs.

I am reliably informed that a majority of the codes had been drafted with the assistance of government grants. One such example is a code submitted for trail riding by Horse SA. After extending approximately $16,000, generously provided by drafting the code, Horse SA, like the others, was constantly told that the code submitted was not adequate due to a requirement that it be narrowly defined.

As one would presume, this became increasingly frustrating, because it required many unpaid hours by volunteers, and eventually Horse SA, like the others, came to the conclusion that the act was unworkable and gave up. Its code has been sat on since—although the Office of Consumer and Business Affairs can be forgiven, because it seems that the code was lost for a portion of this time.

As a matter of interest, I have also been informed that the Office of Consumer and Business Affairs has expressed the view that the sole code registered is not satisfactory and that, if this scheme were to continue, it would have to be reviewed. So, in effect, there would be no registered safety codes at all. Also excusing service providers is the fact that many report legal advice against initiating the costly process of having a code drafted and submitted, for it offers little to no protection. Like the bill before us, it does not apply to minors, with whom most recreational service providers engage at some level.

In addition, the requirement that the safety code be narrowly defined meant that service providers would be walking on an eggshell to remain within its scope. Importantly, several service providers have reported to me that they received legal advice to move interstate, because only there would they have the necessary protection under the law.

One of the great offences inflicted so far on recreational service providers, other than the failed law, is the suggestion that it is service providers who should bear responsibility for the failure of the 2002 act. In a recent feature article that appeared in The Courier newspaper, the minister said that the new bill 'addresses a situation that recreational service providers told us was cumbersome'—no apportionment of responsibility and no recognition that it is their current act that is the complete failure (as the Australian Lawyers Alliance called it), and not service providers failing to comply.

While I am sure the government is more than willing to allow the perception that it took several years for the flawed nature of this bill to become apparent, that is simply not the case. The report of the Economic and Finance Committee which reviewed the operation of the 2002 act, which was furnished in this and the other place in 2005, highlighted that 'certain categories of insurance have now been either prohibitively priced or are just not being offered'. The report also states that 'the social impacts remain serious and sometimes insurmountable'. The report further revealed that premiums payable in South Australia and nationally have been increasing at a rate far greater than the consumer price index and yet no action was taken to repeal the failed act.

One service provider and vocal lobbyist, Ms Sarita Stratton, has stated that in early 2003 she was invited by the then commissioner for consumer affairs to his office to inform her that the new law would not be achieving its goal of placing downward pressure on premiums. So, in early 2003, this government knew that its attempt to improve the access to public liability insurance for recreational service providers had not hit the mark. Now, nearly six years later, we are finally doing something about it. And let us not forget the legislative exemption that this government granted itself so that participants of the Masters Games could sign waivers that were legally binding, despite no safety code being developed.

The Recreational Services (Limitation of Liability) (Miscellaneous) Amendment Bill 2005 provided a period of two years where waivers were again effective. This was done under the guise of recognising that uptake of the protection provided by the 2002 act was non-existent and the two year period was to provide an incentive to develop a code in this time. However, the cynic would clearly see that the true impetus was the refusal of the insurer of the Masters Games to provide coverage unless safety codes were submitted. This was obviously too difficult a task, so the government instead opted to legislate out of the act.

Is there a greater testament to the failure of the law than the government itself, with all its resources, finding it too difficult to comply? But more importantly, what a slap in the face to those providers who had been struggling to remain viable, paying exorbitant public liability premiums, or who had been forced to bear the weighty risk of operating without insurance because they were unable to procure it—or, sadly, those who had folded as a result of either of those circumstances—or because of this government's slowness to act on its knowledge that the Recreational Services (Limitation of Liability) Act was flawed.

On a slight tangent, if the government sincerely desired the success of the 2002 act, it could very well have extended its vast resources to the development of safety codes for all the sports conducted during the Masters Games, which subsequently could have been applied by recreational service providers.

For small organisations to whom the act was intended to apply, this would have alleviated the significant burden of developing those safety codes. Further demonstrating the failure of this act, and more broadly the failure of the Office of Consumer and Business Affairs to educate and regulate, is the fact that many organisations have—and continue to this day—waivers signed by participants and, yes, this includes children, despite such waivers being unenforceable.

Examples of such organisations believing waivers to be effective are too numerous to mention. However, an example can be found in the waivers that participants in the 2009 Skoda Breakaway Series—the amateur sub event of the Tour Down Under—were required to sign. As I am aware that members have been provided with a copy of the terms and conditions for this event, I will avoid reading clause 36(g) in its entirety. However, in part it reads:

I release all persons or corporations associated directly or indirectly with the conduct of the event from all claims, demands and proceedings arising out of my participation, and I hereby indemnify them against all liability, including liability for their negligence and the negligence of others, for all injury, loss or damage, arising out of or connected with my participation in this event.

This event was partly organised by the South Australian Tourism Commission—a government body. So, even if the Tourism Commission did not draft the terms and conditions, it is definitely possible, if not presumable, that it would have at least sighted the waiver that participants would be required to sign.

Another example that I know has been circulated to members is a Motorcycling SA waiver that purports to limit the organiser and venue providers for any injury arising from any action or omission. As members would have noted, the waiver circulated is specifically for parents to sign on behalf of their children. Clearly the aversion felt in this place to parents signing waivers is not shared by the community at large, and I will address this later.

It must be acknowledged that not all service providers are having waivers signed naively. I am aware that members have received an open letter of sorts from a local businesswoman who, under compulsion by her insurance provider, was required to have quite an explicit waiver, purportedly absolving her and, as a result, the insurer from any liability arising from injury or death, signed by all participants. As the majority of her consumers were children, this woman was directed by the insurer to have the waiver signed by the children's parents.

This woman knew from her colleagues in the industry that the waivers were not worth the paper they were printed on but, if having them signed was the difference between coverage for public liability and not, she was more than willing to comply. However, when one organisation that had made a booking made a decision that their participants would not sign the waiver, this woman was forced to appeal to her insurer to allow her to operate without the waiver. Despite the waiver having no legal effect, and that cancelling the booking would severely affect the woman's business, the insurer was adamant that the waivers must be signed and that, if she was to proceed with the booking, she would be doing so without public liability insurance. Needless to say the booking did not proceed.

How the Office for Business and Consumer Affairs, the Commissioner for Consumer Affairs and the minister can allow such a situation to develop and go unchecked is beyond me. But, alas, for seven long years little intervention occurred and instead now we find ourselves in 2009 debating a bill to finally repeal the old act and replace it with yet another novel scheme. The news that the government would finally be addressing this issue was understandably met with a sigh of relief amongst those who were actually aware of the Recreational Services (Limitation of Liability) Act 2002. These people have been paying inflated premiums or have been unable to procure public liability insurance since the crisis and have desperately awaited reform. Reform is what they were promised by this bill.

Just prior to exploring the proposed solution, I make clear my understanding of the intent of this bill. As was the intention in 2002, this bill ultimately seeks to provide greater access to and reduce the premiums payable by recreational service providers. As the Hon. Kevin Foley stated when introducing the 2002 legislation, this is achieved by giving some certainty to the provider as to what the law requires of him or her and to the consumer as to just what safety measures he or she can expect. He continued:

This should assist insurers in actually assessing risks and setting premiums at a realistic level, reflecting actual risks rather than the less predictable risk of being found negligent.

It is the last quote that strikes the fundamental intention of the 2002 act, that is:

...to limit the liability of recreational providers which, in turn, limits the actual risk of insurance providers, resulting in a reduction in premiums payable.

While the bill before us takes a very different approach to the 2002 act, the objective of this bill is again to place downward pressure on insurance premiums and to encourage the provision of public liability insurance.

The introduction of this bill is a clear recognition of the need for an additional measure for recreational service providers and due to the inability to extract figures from the insurance industry—a common complaint, I might add—we must rely on the government's assessment of this need.

Of course, there is a competing objective that cannot be disregarded, that being the interest of plaintiffs, for any limitation on the liability of service providers will, in turn, limit the ability of those who suffer injury to access monetary compensation. In our haste to ensure the viability of recreational service providers, we must ensure that we do not overtly impact on the right of plaintiffs to recoup damages for injury sustained by the fault of a recreational service provider, and so the balance between the two competing interests becomes the objective.

This bill attempts to achieve that objective by introducing a new test, that of reckless conduct, by which a court is to determine whether a recreational service provider is to be held liable at law and, hence, monetarily responsible for an injury sustained during the provision of that recreational service.

It is envisaged that this test is to be of a slightly higher threshold than that currently applied by the common law test of negligence, and this will decrease the number of viable claims against service providers and subsequently reduce premiums paid. The new test's ultimate effectiveness will, of course, be determined by the judiciary and we are asked to simply trust that the bill will work.

However, we can, like the minister, attempt to predict the outcome, although this is made difficult, as much of the language of the new test of reckless conduct, like the safety codes under the present act, is a first in Australia. Just on that, I find it remarkable that the government is willing yet again to allow recreational service providers to play the lab rats in a legislative experiment. Clearly, lessons are not learnt easily.

From my understanding, the reckless conduct test can adequately be summarised as: a recreational service provider will be held liable to damages if they cause a non-trivial injury, if the service provider was aware that there was a non-trivial risk that the injury would occur and proceeded to operate without adequate justification.

The minister, when introducing this bill, provided an example of what is to be considered reckless conduct, that being a horse riding instructor who proceeds with a lesson despite knowing that a snake was around earlier and fails to cut all grass. This is an affront to lovers of horses and, I would say, to rationality in general.

Many horse properties, if large enough, grow their own feed and, regardless, long grass on horse properties or riding trails is a common feature. As for snakes, these are a part of life in this country and while too often killed, their presence is, in the main, accepted. To suggest that a provider of riding lessons or trail rides should cease to operate because a snake was sighted, for fear that it may later re-emerge from long grass, is unrealistic.

To provide this as an example to guide the courts on what is reckless conduct makes one question whether the objective mentioned shall be achieved. I am no lawyer but I have been informed by several that you would struggle, on these basic facts, to hold the recreational service provider liable for negligence, yet the minister, through her second reading explanation, basically instructed the courts to hold them liable for reckless conduct.

Concerns have also been expressed about the minister's example of a significant injury. A significant injury is defined in the bill as not nominal, trivial or minor and was translated by the minister into the practical example of a broken arm. The significant injury element is supposedly intended to reduce the number of viable claims by avoiding those where the injury was nothing more than scratches or bruises.

I know that we have become an increasingly litigious society, but I did not think we had reached the point of a heavy burden of claims arising from mere scratches and bruises. I ask the minister to provide details of how many claims will now be denied by this requirement.

While I am willing to be proved in wrong, I find it highly unlikely that anyone, or at least a significant number of people, has alleged negligence where only scratches and bruises were sustained. However, I can see the significant injury requirement having an effect for mental and nervous shock if the common law, and now the Civil Liability Act 1936, by section 53, did not require the mental affliction sustained to be a recognised psychiatric injury in a claim for pure mental harm.

The liability of defendants is further restricted by section 33 of the Civil Liability Act, which limits a defendant's liability to where a reasonable person would have foreseen that a person of normal fortitude would, in the circumstances, suffer a psychiatric illness. This section also compels a court, when hearing a claim for mental harm, to have regard to whether the mental harm suffered was the result of a sudden shock, whether the plaintiff witnessed another person being killed, injured or put in peril, the relationship between the plaintiff and this person, and whether there was a pre-existing relationship between the defendant and the plaintiff.

However, it seems that section 33 may not apply on a technicality in the reckless conduct test. As section 33 resides in part 6, negligence, I have been advised that it will be open to a plaintiff's lawyer to argue that the normal fortitude element and the other requirements mentioned do not apply. While it is possible that section 33 of the Civil Liability Act 1936 will still be drawn on by the courts when assessing a claim of mental harm, there is, however, nothing in the bill to compel it, and we cannot be certain that this will be extensively litigated by any plaintiff's lawyer whose claim would otherwise fail. To give guidance to the courts, I ask the minister to confirm prior to the committee stage whether it is intended that the elements in section 33 apply.

There is also concern that the inclusion of 'contributes to' in the new statutory definition of 'the cause' has the potential to undermine the fundamental element of the causation as applied in claims for negligence. Causation requires a plaintiff to demonstrate not only that the defendant's negligence was a necessary cause of the injury but also that it is appropriate to hold the defendant liable for injury sustained. The concern is that the proposed wording 'contributes to' is hardly the necessary condition required by causation. This concern is further compounded by the wording of section 34 of the Civil Liability Act in which the present principle of causation is codified, stipulating that it is to apply to an assessment of negligence only.

In the light of this, I will move amendments that, firstly, remove the definition of cause from the bill and direct the courts to apply the principle of causation when determining whether the reckless conduct of the service provider caused significant injury. I acknowledge that the minister has indicated her support for these amendments, and I also thank her and her staff for being available to discuss the issues I have raised tonight and to help us find a resolution that will work for service providers, for people who are injured and also for insurance companies.

The issue of the application of section 33 would lose all potency if the test of negligence is to be applied prior to the test of reckless conduct. I have received contrary advice on the order of argument, and I seek clarification from the minister prior to the committee stage on when exactly during proceedings the courts will hear argument on the reckless conduct test. Will they first turn their attention to the waiver signed to determine its legal efficacy and, if it is found to be valid, then proceed to apply reckless conduct in absence of negligence, or will the courts first hear argument on negligence and, providing this is successfully navigated, turn their attention to the waiver signed?

If it is the latter, the concern about the application of section 33 would be negated as the plaintiff, who would be denied compensation under negligence, will accordingly be denied regardless of the waiver signed. This would also mean that the present certainty that has evolved with the test of negligence will not be discarded—something that will do much to settle the nerves of service providers about this bill.

Being able to clearly determine plaintiffs who succeeded at negligence but who failed due to not being able to demonstrate reckless conduct will also enable this parliament to gauge the efficacy of the bill. However, this becomes somewhat perverted when one realises that it will also make it very clear in the mind of an injured plaintiff why it is that they were denied compensation for their injury.

Prior to moving on, I have one remaining question for the minister. It has been conveyed to me that the hopes of this clause rest upon the words 'without adequate justification', that is, where a service provider proceeds despite a significant risk without adequate justification. I received advice to the effect that this phrase will largely come to resemble the present test of remoteness as applied when determining negligence, which is now largely codified in section 32(2) of the Civil Liabilities Act 1936. I ask for the record: what difference is the minister expecting between the 'without adequate justification' and the 'test of remoteness'?

Next, I turn to an issue that I know most members present have had brought to their attention. Many stakeholders have raised the possibility of the new reckless conduct provision conflicting with the present terms and conditions of public liability insurance. The concern is that insurance providers exclude, that is, refuse to cover, conduct amounting to reckless conduct.

I have been able to obtain a copy of one insurer's public liability policy, and for the benefit of members, I quote the relevant section:

7. This Policy does not cover liability directly or indirectly caused by, arising out of or in any way connected with:

7.25. Any alleged or actual fraudulent, dishonest, malicious, wilful or criminal act or omission of the Insured or any person covered by Definition 2.5 of this Policy.

As a reckless conduct test requires a plaintiff to allege that the recreational service provider was aware of a significant risk that proceeding with the conduct could result in significant injury and did so without adequate justification, this could be considered a wilful, if not malicious, act of the service provider, meaning that the insurer would be under no obligation to pay. In fact, as the policy quoted uses the words 'any alleged or actual', it is possible that the insurer would be under no obligation to even defend the claim.

I know this issue was raised with the Commissioner for Consumer Affairs in early February where a promise was made to investigate it further, and it has since been raised with the minister on several occasions. I just want to know from the minister what the advice from insurance providers and others has been and whether such a conflict does exist. I am inclined to believe that it does because, when I raised this issue in the briefing provided, the response I received was essentially, 'Well, insurers will just have to change their policy.' That was in the very first briefing, I might add.

Has the minister received a commitment from the Insurance Council of Australia and others that this conflict between the bill and present policies will not be exploited, or are we just trusting that insurance providers will change their policies as was suggested to me in the briefing provided? I would also like to raise the issue of one-off events. Many charitable and community-minded citizens have expressed severe disappointment that one-off events will not be covered by these reforms.

The minister in her second reading explanation made it very clear that one-off events are not intended to be covered, yet the bill itself is silent on this issue. An example of such an event would be the cattle run that was held several years ago or a one-off community fundraiser, and I would like the minister to provide the rationale for why these are not to be covered.

The last issue that must be addressed is that of waivers and minors. I initially filed an amendment to charge parents with the responsibility of observing the risks involved in the activity, determining whether the activity is fitting for their child and signing the waiver permitted under section 74I accordingly. However, as I mentioned earlier, the objective of this bill must be the balance between the interests of the plaintiffs and the interests of recreational service providers and, following extensive consultation, I have withdrawn that amendment.

I have nearly finished, and I am sorry I have taken so long. I would like to thank the minister for her cooperation with this, and I do believe that we have been able to reach some sort of agreement on some amendments. I inform members that I did file another amendment this afternoon that I would like them to consider, and I will discuss it with the minister. That amendment would provide that, where recreational service providers are required by their insurer to have waivers signed, the Commissioner for Consumer Affairs will post on a website an explanation of the legality of that waiver so that these recreational service providers can download it and print it so that, when they are forced to have a waiver signed by insurers, they can also provide their consumers with an explanation that the waiver actually does not negate their legal rights to claim compensation under the Civil Liability Act if serious injury occurs through negligence or reckless conduct.

What has concerned me in regard to waivers is that this is the big lie that the insurance companies want to perpetrate, and it is a bluff. By posting this on the website of the Office of Consumer and Business Affairs people will be better informed, if they are required to sign a waiver, that they still do have some legal rights. I think that is very important. It will also, as I said, dispel the big bluff of the insurance companies. The hope is that people will sign waivers and then truly believe they have no right to make any claim for injuries under the Civil Liability Act. That is the bluff.

If members of the general public are sufficiently well educated to believe that they still have those rights, even though service providers are forced to have waivers signed, this will go a long way to assist service providers and also people who may have been injured during an activity. Also, we are not compromising the rights of children. I thank members for their patience. I look forward to the committee stage of this debate, and I believe that there is still more to learn.

The Hon. G.E. GAGO (Minister for State/Local Government Relations, Minister for the Status of Women, Minister for Consumer Affairs, Minister for Government Enterprises, Minister Assisting the Minister for Transport, Infrastructure and Energy) (21:42): By way of concluding remarks, I thank all honourable members for their very valuable contributions, a number of which were quite extensively researched and provided very good quality information. I acknowledge the contributions of the Hons. Mr Darley, Mr Parnell, Mr Brokenshire, Ms Lensink, Mr Lawson and Ms Bressington.

Recreational and sporting activities are obviously of great benefit to the community and the state, and this is an important and complex area of law. The guiding principles throughout the development of these reforms has been a desire to promote sporting and recreational activities in a way that protects the interests of both consumers and service providers. There will always be argument about whether the government has the balance right. Some members of the community will argue that the pendulum has swung too far in favour of service providers at the expense of consumers. Others will argue that the bill does not go far enough to modify the liability of service providers and that further changes, including changes to allow the rights of minors to waive, should be made. Overall, however, the government believes that the bill does strike the right balance.

As for specific concerns that have been raised by members, I will start with the concerns about the impact of the bill on insurance premiums. Some service providers have expressed concern that the new law will increase the cost of insurance. We are moving from a law that does not allow recreational providers to modify, exclude or restrict their liability for personal injury (except by a safety code) to a law that does allow recreational service providers to modify their liability in certain circumstances. The bill will therefore reduce, not increase, the liability of service providers and their insurers. It does not make sense to suggest that a bill that will result in reducing liability will lead to an increase in premiums. However, these are matters which will be determined in the market economy.

Concerns have also been raised about the impact of the new law on minors. Some service providers have urged the government to allow minors (or parents, on their behalf) to waive their rights to have services supplied with due care and skill.

Children are some of our most valuable and often most vulnerable members of our community. Unlike adults, children are not in a position to question the action of service providers when things seem out of place, nor can children properly assess the risk of continuing to participate in an activity. Children cannot always be supervised by parents or an adult 100 per cent of the time when they are participating in the wide range of recreational activities that are available to them, and that is why the common law does not allow children or parents on their behalf to waive their common law right to sue for negligence.

It is also why the government has chosen not to allow children to waive their statutory right to have a service supplied with due care and skill. This applies to the government, the organisers of the Tour Down Under and every other recreational provider in this state. Attempts under this bill to waive either a child's common law or statutory right to have service supplied with due care and skill will not be effective. Some members have questioned whether we should simply rely on the common law of negligence and not make changes to the Fair Trading Act. The liability of recreation providers is, and will continue to be, governed by the common law.

There are, however, a range of other laws of general application that impose obligations on service providers. Fair trading laws are one example. Under the Consumer Transactions Act and now the Fair Trading Act, service providers have a statutory obligation to supply services with due care and skill. That requirement cannot be modified or excluded. If the government were simply to repeal the Recreational Services (Limitation of Liability) Act and do nothing more, recreational providers would not be able to modify or exclude the statutory warranty that requires services to be rendered with due care and skill.

Some may argue that this is an acceptable outcome. It would place recreational providers in the same boat as any other service provider in the state. In response to the concerns of recreational providers, however, the government has chosen to allow those providers to waive their statutory obligations to provide services with due care and skill in certain circumstances. That is the balance we have pitched, and we believe that is a fair and reasonable balance in terms of addressing the range of interests that are affected. A number of other questions were asked of me, some of them quite specific, others more general. I am happy to take those on notice and to provide answers during committee. I therefore commend this bill to members.

Bill read a second time.

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