Contents

Chapter 5
Relief for a minor defendant

Introduction

5.1We recommended in Chapter 3 that joint and several liability remain the rule in all cases involving the liability of multiple defendants for the same damage. Each defendant who is held liable for a proven loss should remain liable to compensate the plaintiff for the whole of the damage or loss. However, they may claim a contribution or indemnity from other wrongdoers who are liable for the same loss.61 We are convinced that joint and several liability best supports the principle that a blameless party wronged by another should be compensated for their loss. Because of the availability of contribution, the end result will also often be broadly fair and proportionate among the liable parties.

5.2Accepting that joint and several liability should apply in all cases, there will be a small number of cases where the actual liability a defendant is required to pay is not matched by their share of responsibility as determined by the court. We have concluded that in the interests of fairness there should be provision for an exception that allows that defendant some relief. Such a concession should only be made after a judge has carefully assessed the nature of the obligation that the defendant has breached and its connection to the total loss suffered by the plaintiff. The court would also need to be satisfied that there would still be an effective remedy for the plaintiff. We do not envisage this concession being granted lightly, but we believe it to be an essential brake on the potential injustice from a too thorough-going application of the normal rule. Otherwise, there will be a small number of cases where a defendant who is properly held liable nevertheless bears a much lower proportion of fault or responsibility compared to other liable defendants. If such a liable defendant is forced to pay all or most of the plaintiff’s damages because other defendants are unavailable, it may be difficult to describe that result as fair or just.

5.3Differences in levels of responsibility among wrongdoers are fact-specific and are likely to involve a variety of considerations. These are matters that judges must assess when dealing with contribution, and apportionment of responsibility more generally. However, there will be a small number of liable defendants who may be described in a common sense way as minor contributors to the plaintiff’s loss, or “minor defendants”. Occasionally, a defendant may be only just above the relevant threshold for liability, but once held liable they are subject to joint and several liability in the normal way. Liable defendants in this category, whom we term “minor defendants”,62 may consider that joint and several liability applies particularly harshly to them, at least when other defendants are missing or unable to pay.

5.4In Chapter 4 we discussed and rejected the option of providing a percentage threshold below which parties would be proportionately liable and above which joint and several liability would apply. In this chapter we recommend a reform that would retain joint and several liability for all liable defendants but also address the circumstances of the small subset of truly minor defendants. We propose that legislation set out a statutory definition and a regime for minor defendants, to allow courts and tribunals to grant relief to a minor defendant from the full effects of joint and several liability in cases where that is necessary to prevent injustice.

61Or, in most cases, who would have been liable if sued by the plaintiff in time: Law Reform Act 1936, s 17(1)(c). The exception is the 10 year longstop provisions from the Building Acts 1991 and 2004, which have been held to exclude contribution claims more than 10 years after the relevant event, in addition to the primary exclusion of liability to a plaintiff: Perpetual Trust Ltd v Mainzeal Property and Construction Ltd [2012] NZHC 3404 at [47].
62In Law Commission Review of Joint and Several Liability (NZLC IP32, 2012) [Issues Paper] we used alternative names for this potential class of defendants, including “peripheral wrongdoer”. We have opted for “minor defendant” in this Report, because we consider it best characterises the truly minor responsibility that such a defendant would need to demonstrate to be considered for any partial relief from their legal liability. “Minor” is a simpler concept, and can be more naturally and readily applied to the circumstances, contribution and responsibility of a particular liable party.