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The new Civil Procedure Act (VIC) - Increased obligations for medical practitioners and insurers

Newsletter Article 01 March 2011

The Civil Procedure Act 2010 (Vic) (the Act), which came into operation on 1 January 2011, has significantly reformed Victoria’s civil procedure laws and introduced new obligations for all parties involved in civil proceedings. Medical practitioners and insurers should be aware of these obligations and how they will impact on the conduct of litigation in medical negligence and other health related matters.

'Overarching purpose’

One of the main purposes of the Act is to provide for an ‘overarching purpose’ in relation to the conduct of civil proceedings. This is to facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute.

The court must give effect to the overarching purpose in exercising its powers and may give any direction or make any order it considers appropriate to further the overarching purpose. This could influence the manner in which courts make decisions in all civil proceedings, particularly if the court determines that one party is acting contrary to the overarching purpose. This may include causing an unnecessary delay in proceedings or failing to use reasonable endeavours to resolve the dispute.

'Overarching obligations’

To assist the court in achieving the overarching purpose, the Act provides for overarching obligations for participants in civil proceedings. These obligations are intended to improve the standards of conduct in litigation and set out certain steps which must be taken by litigants and their legal representatives.

Litigants and legal representatives, as well as expert witnesses and insurers, now have a paramount duty to the court to further the administration of justice.

Other overarching obligations include:

  • acting honestly;
  • not making any claim or response that is frivolous, vexatious, an abuse of process or does not have any proper basis;
  • only taking steps to resolve or determine the dispute;
  • cooperating in the conduct of the civil proceeding;
  • not misleading or deceiving;
  • using reasonable endeavours to resolve the dispute; and
  • narrowing the issues in dispute.

As a defendant in proceedings, a medical practitioner must prepare an overarching obligations certificate which states they have read and understood the overarching obligations and the paramount duty. This original certificate must be filed in court with the defence and a second certificate prepared by your legal representative stating that each allegation, denial and non admission in the defence has a proper basis.

While parties involved in civil proceedings have always had obligations to the court, traditionally only legal representatives had an express obligation to further the administration of justice. There has never been a requirement to provide a signed declaration that each party is aware of their obligations and has complied with them.

In the event that any party does not comply with their obligations, there may be cost consequences. The court is also entitled to make any other order that it deems appropriate in the interests of justice which may include compensating any person for financial loss or taking additional steps to remedy the contravention of the overarching obligations.

Pre-litigation Requirements

The Act introduces new pre-litigation requirements aimed at having disputes resolved in a timely and cost effective manner. These changes will come into effect on 1 July 2011.

Parties will now be required to take reasonable steps to resolve the dispute and to clarify the issues in dispute before the commencement of proceedings. Reasonable steps will include:

  • exchanging all correspondence, information and documents which are critical to the resolution of the dispute; and
  • considering all options for resolving the dispute such as alternative dispute resolution.

If proceedings are commenced, another certificate must be filed certifying that the parties have read and understood their obligations and duties and have complied with all pre-litigation requirements. Medical practitioners and insurers must comply with the pre-litigation requirements in order to avoid possible sanction from the court if proceedings are later commenced.

While litigants previously had an obligation to make a genuine effort to resolve the dispute before trial, there was no obligation to exchange documents and to take reasonable steps prior to proceedings being commenced. Insurers need to be aware of these requirements as each party will be required to bear their own costs of complying.

We note that the current State Government is proposing to remove these pre-litigation requirements from the Act. We will provide a further update if this change occurs.

With the advent of the civil litigation reforms detailed above, medical practitioners, as well as insurers, should now be apprised of the new obligations under the Act.


Abby Neylon, Senior Associate
Melbourne

Newsletter Article 01 March 2011
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