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<P><A href="http://afr.com/"><IMG height=24 src="http://afr.com/images/afrlogo.gif" width=217 border=0></A></P><B><FONT face="Courier New" size=5>
<P>Liability decision rouses anger<BR></B></FONT><SPAN style="FONT-SIZE: 18pt"><BR></SPAN><FONT face=Arial size=3>Chris Merritt, Legal editor<BR>08/03/2003 </P>
<P>The federal government's decision to reject calls for a national system of capped liability for the professions triggered a storm of protest on Friday and calls for the government to explain why it had apparently pre-empted its own review of the issue.</P>
<P>The peak national body representing most professions, <STRONG>Professions Australia</STRONG>, said the government's decision suggested it had rushed to judgement on the basis of inadequate information.</P>
<P>The organisation said it was still in the process of providing information to the government and had believed a decision would not be made until April 4 when insurance ministers are due to meet in Perth.</P>
<P>David Stephens, of Professions Australia, said his organisation was concerned that it had been misled into thinking that the debate was continuing and was worried that ministers had already made up their minds.</P>
<P>In a message to its supporters, Professions Australia urged its backers to express their outrage to the federal government over the remarks of a spokeswoman for the Assistant Treasurer, Helen Coonan, that were reported in Friday's <I>Australian Financial Review</I>.</P>
<P>Senator Coonan's spokeswoman had said the government was not convinced that a capping regime was appropriate for the professions. The question of capped liability for the professions should not have been disposed of in early March "by means of off-the-cuff remarks to a journalist", the message said.</P>
<P>Professions Australia and the Law Council of Australia have been lobbying for the national extension of the the system of capped liability that is contained in professional standards schemes that operate in NSW and Western Australia.</P>
<P>These schemes limit the potential liability of professionals to a set amount in return for mandatory levels of professional indemnity insurance and improvements in service delivery.</P>
<P>The schemes' backers want the federal government to close a loophole that allows clients who wish to sue lawyers and other professionals to avoid the state limits on liability by seeking unlimited damages under the federal Trade Practices Act.</P>
<P>They say this would lead to reduced payouts by insurers and would ease the crisis in the market for professional indemnity insurance.</P>
<P>Dr Stephens said those who object to caps on payouts by professionals claim to be protecting consumers.</P>
<P>"But the proposal from professionals is that caps for economic loss will be set - under legislation - at a level that exceeds the likely value of all individual claims and almost all corporate claims," he said.</P></FONT><FONT size=1>
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