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Government's product liability prposal defective-Costello



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PARLIAMENT OF AUSTRALIA HOUSE OF REPRESENTATIVES

PARLIAMENT HOUSE. CANBERRA. ACT. 2600. SUITE R 2 117 PHONE (062) 77 4750 FAX (062) 77 2124 20 BEATTY AVENUE, ARMADALE. VIC 3143 PHONE (03) 822 4422 FAX (03) 822 0319

PETER COSTELLO, M.P. FEDERAL MEMBER FOR HIGGINS SHADOW MINISTER FOR CORPORATE LAW REFORM AND CONSUMER AFFAIRS

GOVERNMENTS PRODUCT LIABILITY PROPOSAL DEFECTIVE - COSTELLO.

"Australian consumers will suffer a price shock if the Government proceeds with its defective and ill-conceived product liability proposals", according to Opposition spokesman on Corporate Law Reform and Consumer Affairs, Mr Peter Costello.

In an address today to the Metal Trades Industry Association conference on law reform, Mr Costello warned manufacturer's costs would increase, insurance premiums would rocket and litigation costs would rise if the proposals were implemented with the costs borne totally by the consumer.

"The Government's proposal that the onus of proof be reversed will mean that manufacturers products will be assumed to be defective unless they prove otherwise. All manufacturers in court actions will be assumed to have manufactured defective products

unless they can prove otherwise", Mr Costello said.

"The Government has made it clear that the new law will not supersede or replace existing laws. This means manufacturers will still be liable in negligence, contract and under statutory provisions of the Trade Practices Act, as well as in situations where they have not been negligent, where they have observed their contractual obligations as to quality and where they have not breached the current terms implied by statute.", Mr Costello said.

"Higher safety requirements will lead to better products for wealthy consumers but at the risk of prohibiting poorer consumer from obtaining the product at all", Mr Costello said.

"We could pass a law requiring all drivers to drive Volvos. In the interests of allowing a wider motor vehicle ownership we allow people to drive less safe cars", Mr Costello said.

Similarly, "we could rewrite airline regulations and airline safety standards so that aeroplanes presented no risk. In the process we could make the cost of flying so high that hardly anyone would fly", M r Costello said.

The result of the Government's proposals will be that the vast majority of consumers and all manufacturers will suffer. The prime beneficiaries will be lawyers", Mr Costello said.

END RELEASE: 4 September 1991 CONTACT: Anthony Smith Canberra 277 4750 or AH (018) 324 009

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