One of the most difficult issues in our civil law is how to deal with situations where two or more defendants are held liable to a plaintiff for the same damage. The present rule governing this situation is commonly referred to as the rule of “joint and several liability”.
This rule is of considerable importance in the day to day operation of our civil law. It impacts particularly on the construction sector and the leaky buildings crisis which the country has had to grapple with for some years now, business and professional services (particularly in the context of the financial crises which have had to be faced), and local government (which is often seen as the defendant of “last resort”). Of course, the rule applies across all areas of civil liability, particularly in tort, not just in these high profile areas.
Under joint and several liability each defendant is held liable for the whole of the damage regardless of how many other defendants are also liable (which often means a race to the deepest pocket); whereas under proportionate liability each defendant is responsible for his or her or its relative level of fault, which is a regime of comparative responsibility.
This rule has been the subject of legal and parliamentary interest over the last quarter of a century, not just in New Zealand but in other common law jurisdictions too. As recently as 1998 this Commission recommended that the rule of joint and several liability be retained, but we were particularly asked to look at the issue again in a broad way in light of the construction and financial crises of the last decade.
This Issues Paper sets out the rules, how they have come about, what their effects are, and what the possibilities are for adjustment. We seek input from the various industry sectors and from the public at large before formulating our Final Report to the administration of the day, on legal issues that are of fundamental importance within our present civil justice system.