XN000022-1991-05-08 — Page 5

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WEDNESDAY, MAY 8, 1991

MR MATHEWS WAS REPLYING TO MR PETER WONG'S RESERVATIONS TO THE EFFECT THAT THE LATENT DAMAGE PROVISIONS OF THE BILL WOULD INCREASE THE EXPOSURE OF ACCOUNTANTS TO NEGLIGENCE

SUBSTANTIALLY

CLAIMS.

SPECIAL

MR WONG ALSO REFerred to THE ACCOUNTANTS' PLEA FOR CONSIDERATION AND THE POSSIBILITY OF AN EXEMPTION FROM THE OPERATION OF THE NEW PROVISIONS.

TO ELIMINATE THE POSSIBILITY THAT SOMEONE WAS SUED BY VIRTUE OF THIS NEW PROVISION MANY YEARS AFTER THE ALLEGED NEGLIGENT ACT OR OMISSION OCCURRED, MR MATHEWS SAID, THE BILL PROVIDED THAT NO ACTION SHOULD BE BROUGHT AFTER THE EXPIRY OF 15 YEARS FROM THE DATE OF THAT ACT OR OMISSION.

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"THIS IS A BENEFIT THAT POTENTIAL DEFENDANTS DO NOT HAVE, HE SAID,

PRESENTLY

ONLY THAT

MR MATHEWS NOTED THAT THE ACCOUNTANTS WERE THE PROFESSIONAL GROUP TO HAVE SOUGHT SUCH AN EXEMPTION. "THE VIEW THE PROVISIONS IN THE BILL CONCERNING LATENT DAMAGE WILL SUBSTANTIALLY INCREASE THE POTENTIAL LIABILITY OF PROFESSIONALS IS, I THINK, UNFOUNDED.'

ON MR WONG'S OBSERVATION THAT THE BILL WAS INTRODUCED TO DEAL WITH HIDDEN DEFECTS ARISING FROM CONSTRUCTION WORK, MR MATHEWS SAID THE BILL WAS BASED ON THE ENGLISH LATENT DAMAGE ACT 1986 WHICH GAVE EFFECT TO RECOMMENDATIONS OF THE ENGLISH LAW REFORM COMMITTEE.

MR MATHEWS SAID WHILE THE COMMITTEE, IN ITS REPORT, RECOGNISED THAT THE MAJORITY OF CLAIMS FOR LATENT DAMAGE HAD ARISEN OUT OF

A BUILDING AND CONSTRUCTION WORK, IT EXPRESSLY REJECTED

SUGGESTION THAT THE SPECIAL THREE-YEAR LIMITATION PERIOD SHOULD BE RESTRICTED CLAIMS IN RESPECT OF BUILDINGS.

ΤΟ

PROPOSING AMENDMENTS TO THE BILL DURING THE COMMITTEE STAGE, MR SAID THE NEW DATE OF COMMENCEMENT OF THE ORDINANCE WOULD BE

MATHEWS JULY 1, 1991.

PROPOSED NEW SECTION 33 OF THE BILL WAS DELETED AS THE SECTION HAD BEEN RENDERED UNNECESSARY FOLLOWING A RECENT DECISION OF THE HOUSE OF LORDS.

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