Legal Liability - Cover

Introduction

This section covers legal liability claims against participating entities. It includes, but is not limited to, what is commercially known as public liability, product liability, professional indemnity liability, employment practices liability and directors and officers liability. However, the cover provided by the Fund may extend beyond what is usually covered under similar commercial policies. Participants should contact Treasury to seek advice if in doubt as to whether any particular matter is covered under the Fund.

The Fund will consider providing cover for other liability risks outside of the above where the entity concerned is prepared to accept responsibility for that risk and wishes to manage its financial exposure through the Fund. Participants are required to contact Treasury and provide information necessary to enable Treasury to evaluate whether the risk can be properly identified, assessed and covered by, or through, the Fund.

Cover

Cover is provided to inner-Budget agencies and other specified entity (see Entities covered by the Fund) for any amount they are legally required to pay (or would have been legally required to pay if sued) in relation to:

  • personal injury or property damage (including consequential economic loss) to a third party, caused by the actions of an agency and/or an agency representative acting within the course and scope of his or her employment ("public [general] liability"). This includes third party injury or damage for which the agency is legally liable, caused by the activities of groups working on behalf of an agency, such as volunteers and work experience students. Further information is provided below;
    [Note: that if a claim is made in relation to a latent medical condition (eg asbestosis), the date of the claim will be taken to be the date on which the condition was first medically diagnosed.]
  • a wrongful act, error or omission in the discharge of the managerial duties by a director, manager, officer or any other person involved in the management of an agency ("directors and officers liability");
  • a breach of the professional duties of a participating entity or its representative ("professional indemnity"). Examples could include:
    • incorrect advice given to a third party on a child welfare matter;
    • incorrect advice given to a third party employer regarding employee safety; and
    • incorrect advice given to a land owner/occupier for a crop management problem.
  • personal injury or property damage (including consequential economic loss) arising from anything manufactured, serviced, altered or prepared by an agency ("product liability"). Examples could include:
    • illness caused by contaminated food prepared in a hospital or school canteen;
    • injury to a member of the public caused by a protruding nail on an item of furniture manufactured by an agency; or
    • injury or damage resulting from incorrect or insufficient labelling or instruction on or about a product.
  • from 1 November 2010, employment practices claims brought by an employee against an agency, such as unfair dismissal claims and sexual or workplace harassment claims ("employment practices liability"). However, this cover is only provided on a case by case basis, and is subject to the claim being confirmed as appropriate and legitimate by both the Fund Administration Agent and the Office of the Solicitor-General. This cover does not extend to mistakes by an agency in relation to its employees ie incorrect payment of entitlements or incorrect advice provided to employees.

The cover provided above extends to any liability of the agency arising from the operation of law such as under the Civil Liability Act 2002, which effectively transfers liability from a volunteer to an agency in specified circumstances.

For clarity, set out below are examples of activities by groups or persons for which an agency will be covered for public liability claims where the Crown is found to be liable:

  • volunteers who are under the direct control of an agency, ie they are directly appointed by the agency (and can be dismissed by the agency) and there is a high level of agency supervision;
  • students involved in workplace learning if they are enrolled at a government school or college when participating in:
    • school-initiated workplace learning programs, provided that the students are placed with a Department of Education approved business in Tasmania or interstate; or
    • Department of Education approved workplace learning activities as part of a vocational education and learning (VEL) program; or
    • Department of Education approved Special and Alternative Learning Programs;
  • home-educated students registered with the Tasmanian Home Education Advisory Council (THEAC) when participating in VET learning activities, provided that the student is placed with a Department of Education approved business in Tasmania or interstate, and the businesses comply with any relevant Department of Education guidelines;
  • students of TasTAFE participating in work placements approved by that entity;
  • offenders undertaking community work associated with a drug treatment order issued pursuant to section 27B of the Sentencing Act 1997;
  • young offenders undertaking community service orders issued pursuant to the Youth Justice Act 1997; and
  • young people undertaking work as part of a formal police caution under the Youth Justice Act 1997.

[Note: details on the conditions upon which cover is provided in relation to any of the examples above should be sought in the first instance from the relevant agency and/or the Fund.]

Other persons provided with cover

Generally the cover provided by the Fund is limited to the liability of the Crown and does not extend to personal liability cover for third parties. However, the Fund will cover personal liability where an indemnity has been provided by the Panel established to consider an application from a Public Officer for an indemnity and/or legal assistance. 'Public Officer' is defined in Employment Direction No 16 (1 January 2016) - Indemnity and Legal Assistance. This Direction specifies the circumstances in which indemnity and legal assistance may be granted to employees and officers, including Heads of Agency, appointed under the State Service Act 2000.

In addition, cover is provided by the Fund for:

  • volunteers who are under the direct control of a participating entity;
  • students involved in workplace learning if they are enrolled at a government school or college when participating in:
    • school-initiated workplace learning programs, provided that the students are placed with a Department of Education approved business in Tasmania or interstate; or
    • Department of Education approved workplace learning activities as part of a vocational education and learning (VEL) program; or
    • Department of Education approved Special and Alternative Learning Programs; and
  • home-educated students registered with the Tasmanian Home Education Advisory Council (THEAC) when participating in VET learning activities, provided that the student is placed with a Department of Education approved business in Tasmania or interstate, and the businesses comply with any relevant Department of Education guidelines.
In these cases, the Fund will not respond in circumstances where the covered person:
  • acts outside the scope of the activities authorised by the agency, or contrary to its instructions; or
  • is affected by alcohol or certain other drugs at the time of the incident; or
  • the claim arises in relation to a motor vehicle accident.

Personal liability cover for other third parties will only be provided by the Fund in extra-ordinary circumstances and where the Government's policy in relation to the granting of indemnities does not otherwise apply. Such cover should be discussed with Treasury.

Exclusions

Capital Works contracts

The Fund does not provide liability or other types of cover for work done under a capital works contract. Civil and civic works contractors are required to either obtain their own insurance in relation to public liability and works or retain Principal Nominated Contract Works and Legal Liability Insurance through commercial policies organised by Treasury through the Fund Administration Agent.

See the Purchasing website for further information.

Third party personal injuries claims - motor vehicles

Liability cover is also not provided for third party personal injury claims arising from the use of a registered motor vehicle. This is insured through the Motor Accidents Insurance Board which operates a motor accident scheme providing medical and income benefits, on a no fault basis, to persons injured in motor vehicle accidents whilst still enabling access to common law.

Other

Liability cover is not provided to:

  • students participating in regular school activities including excursions, school camps, after hours school sport etc (other than vocational education and training [VET] and Special and Alternative Learning Programs); or
  • apprentices; or
  • students from the University of Tasmania when on work experience with agencies as part of their course. Students from the University should be asked to provide the agency with evidence that they are covered by the University's public liability insurance policy prior to commencement; or
  • parliamentarians (unless an indemnity has been granted).

It should be noted that legislation establishing Boards and Commissions usually includes a provision ensuring that Board and Commission members are immune from personal liability claims.

Extent of cover

Subject to nominated excesses, cover is provided for:

  • the amount that a participating entity, or indemnified person, is legally liable to pay to a third party; and
  • any claim investigation and/or legal fees provided that the claim investigation fees are considered reasonable by the Fund Administration Agent and the legal services have been provided or sanctioned by the Office of the Solicitor-General.

Cover does not include the cost of penalties or fines payable under statute (unless otherwise determined by the Panel established to consider an application from a Public Officer for an indemnity and/or legal assistance).

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