INTRODUCTION

A no-fault comprehensive compensation fund is a significant part of a jurisdiction’s legal framework. In the four jurisdictions that are studied here, the fund framework affects the way that individuals access justice for specific types of injury-related harms. Most specifically, it restricts access to the courts and an individual’s choice about whether to pursue potential defendants.

However there has been little or no analysis of how no-fault comprehensive compensation funds intersect with human rights and access to justice issues. There is a current knowledge gap about the intersection between human rights and no-fault compensation funds generally. This chapter, however, focuses on the impact of comprehensive no-fault funds on human rights and access to justice issues, as a discrete sub-field. Large funds pose slightly different issues in the realm of human rights, compared with their smaller cousins. This is because they create a near or total restriction on the ability of a comprehensive category of claimants to access court-based remedies or settlements. As a trade-off for this, they offer a statutory entitlement to compensation for certain classes of injury, and a fast and streamlined claims process. However, a question that has not fully been analysed by research or practice remains: is this balancing act ultimately a fundamental problem from a human rights perspective, or an acceptable alternative approach?

The four big funds studied in this book are located in jurisdictions that do not all have a fundamental human rights framework equivalent to the European Convention on Human Rights (ECHR) or the United States Constitution. Only Canada’s human rights frameworks are connected to its written constitution and/or have a fundamental nature. This leads to a natural or default presumption that a fundamental human rights framework may be incompatible with such a fund, or that the fund hinders access to justice in an unacceptable way. However, there has been no scholarly legal analysis of whether these presumptions or suspicions would be correct.

INTRODUCTION

This book has contributed to the comparative law landscape of compensation funds in general, by identifying the key characteristics and principles of the world’s most comprehensive no-fault compensation funds. The field of no-fault compensation has been broad and ill-defined until now, despite many differing shapes of alternative liability schemes existing for decades in multiple jurisdictions. It is only in this century that legal scholars have attempted to more precisely classify these liability frameworks, better understand their function and nature, and apply scholarly rigour to their unruly growth. Very big no-fault compensation funds, which are publicly managed and publicly underwritten, are the purest and most expansive forms of no-fault or no-blame redress structures.

The four schemes analysed in this book are the largest and most expansive of their type, covering around 21.6 million people in total, with automatic entitlement to compensation for certain types of injuries, but severely restricting access to ordinary court remedies. This book is the first scholarly analysis of this category of comprehensive no-fault compensation funds. The key learnings of this book are relevant to the existing funds themselves, new funds that are coming into existence, and smaller less comprehensive funds which can define themselves in similarity or contrast with the largest exemplars of no-fault.

Three research questions were posed in the research that underpinned this text. The choice of these research questions was motivated by an observation of knowledge gaps in the current scope and practice of big no-fault compensation funds. The research questions were also motivated by the goal of evolving the understanding of the law surrounding big compensation funds a step further from Peter Cane’s bipolar abolitionist and incrementalist camps of tort law reform. The definition of a no-fault comprehensive compensation fund can be summarised as follows. It is a fund that compensates individuals for a statutorily defined comprehensive range of harms, on a no-fault basis (i.e. showing liability is not necessary to access compensation). The scheme is administered by a single public or quasi-public centralised body.

INTRODUCTION

This chapter considers the four existing no-fault comprehensive compensation funds, and analyses their purpose, scope and effect. Firstly, each jurisdiction is described and analysed using a pluralist comparative law approach (considering functional, structural, and in-context elements). After this, the selected funds are compared and analysed by their function – how they deal with the same kinds of loss incidents (traffic injury, medical/pharmaceutical, employment injury and everyday risks of life). Next, the learnings from the no-fault comprehensive approach are compared to functionally relevant French, Belgian and Nordic no-fault compensation funds. The European funds have functional and purposive relevance to our four no-fault comprehensive compensation funds. They are not as comprehensive as the key New Zealand, Australian and Canadian funds, but they represent a significant departure from standard compensation and liability law approaches in those jurisdictions. The European funds have also been compared in the past with one another. Finally, conclusions are drawn about this comparative law analysis of existing systems. This partially answers the first and third key questions, and forms the departure point for further comparative law analyses in the subsequent chapters on issues of administration, human rights, access to justice and possible future applications.

NEW ZEALAND’S ACCIDENT COMPENSATION CORPORATION (ACC)

When jurists consider the issue of tort law losses, social insurance protections and insurance coverage in the New Zealand jurisdiction, the impact of one compensation fund is always addressed before any other consideration. That fund is the universal single-window statutory scheme for personal injury compensation, administered by the Accident Compensation Corporation (hereafter ‘the ACC Scheme’). Under this scheme, individuals forego the right to sue for compensatory damages for injury under the common law, in exchange for this comprehensive cover and compensation. The fund also has a mirror injury prevention and rehabilitation focus, which makes the purpose and scope of the scheme wider than financial compensation.

The ACC Scheme is something of a legal ‘unicorn’ because, despite being in effect for the best part of 50 years, it has not been wholly replicated (i.e. its multifunction coverage) in any other major common law or civil law jurisdiction.

INTRODUCTION

This book has so far crystallised and analysed, for the first time, a definition of the largest type of no-fault comprehensive compensation funds that are publicly administered. It has also developed a suitable comparative law methodology for analysing such funds. There was an initial consideration of the core problems associated with the classification of compensation funds generally. This is because there is a lack of agreed definition within existing literature and practice about no-fault compensation funds generally. There has also been no significant scholarly analysis of the largest types of no-fault compensation funds in particular. In Chapters 3 and 4 there was a practically focused crystallisation of the defining and key features of very large and mature no-fault compensation funds, with appropriate functional and structural comparisons. There was also a novel first principles consideration of the intersections between very large no-fault compensation funds and human rights, with a specific focus on access to justice and dispute resolution issues. This crystallisation and analysis approach has added to the existing literature by providing a clear picture, for the first time, of the key legal landmarks of comprehensive no-fault compensation funds, as a subset of the wider no-fault or no-blame compensation funds.

However, in order to be most relevant and useful, this research also needs to look toward the future development of large no-fault compensation funds. There is potential for no-fault frameworks, as a non-liability compensation solution, to be used to address contemporary and future problems. These problems range from issues as diverse as new jurisdictions adopting the comprehensive no-fault model for transport injury, artificial intelligence damages applications, to the implementation of national and global vaccine injury compensation funds to underpin the COVID-19 global vaccination campaign. The analysis undertaken in this book provides more definitional clarity and guidance about the positive and negative elements of these very big schemes, which enables more informed legislative and policy choices to be made about the future of our four existing funds and the development of new funds.

INTRODUCTION

This chapter analyses some of the core problems afflicting the classification and analysis of compensation funds generally, and no-fault comprehensive compensation funds specifically. The inconsistent legal philosophical and technical definitions and usage of compensation funds across different jurisdictions illustrate a number of key problems that require proper framing and analysis.

THE DISTINCTION BETWEEN SOCIAL SECURITY SCHEMES AND NO-FAULT COMPREHENSIVE COMPENSATION FUNDS

The design of social security systems globally varies widely depending upon legal tradition and other political and economic influences. European systems in states like Belgium, the Netherlands and France generally have a ‘Bismarck-ian’ contributions-based social insurance structure. The United Kingdom, New Zealand and Scandinavian countries generally follow a ‘demogrant’ system, which guarantees universal entitlement to social security benefits if citizenship or residency requirements are met. Other countries, including Canada, Australia and the United States take a blended approach involving social insurance, universal social security and private insurance/out-of-pocket principles depending on the particular social security purpose.

There are differing theories from legal scholars about the social security overlap with compensation funds generally and no-fault comprehensive compensation funds in particular. A no-fault comprehensive compensation fund has been described by Cane and Goudkamp as a ‘social welfare solution’ to the problem of compensation. Some tort law scholars have classified no-fault comprehensive compensation funds as a complete social insurance system that follows from the logical extension of loss distribution to all accidental losses.

Knetsch classified compensation funds generally as being distinct from social security because they provide compensation without means-testing, evidence of prior contributions or affiliation and operate in a narrow field related to the circumstances of damage. Macleod and Hodges have most recently described an international trend towards compensating personal injury on a no-fault basis as a shift to compensating on a ‘wider social basis’ that may also (depending on the jurisdiction) be infused with concepts of social solidarity.

OVERVIEW

This book begins with some broad normative philosophical questions about the function and purpose of compensation and liability law. How should societies effectively and efficiently compensate for damage and loss? Legal, social and financial systems in different jurisdictions use a variety of tools to remedy an unexpected loss due to injury or other misfortune. Tort law damages are the classic common and civil law (private law) tool; contracts of insurance (another private law tool) and social security protections (a public law tool) may supplement or replace tort law damages (or the loss falling on the victim’s own pocket) depending upon the circumstances.

Despite the best efforts of actuarial and economic experts, it is challenging to predict or pre-emptively design a compensation system that is suitable for every type of misfortune. What remedy is there for individuals who cannot (or cannot easily) access compensation for their loss via existing compensation systems, such as insurance or the courts system? Can legal experts such as judges, legislators and policymakers design a fair and efficient way to provide speedy compensation to a wider range of victims? What is the distinction between misfortune caused by a discrete event of damage and misfortune caused by an ongoing condition or circumstance? Further, in an increasingly ‘supranational’ and highly digitised world, facing global compensation challenges, can we (and should we) harmonise how compensation is managed in different jurisdictions? There are injuries and misfortune caused by human actions, and increasingly, injuries caused by automated and technology actions. The world is also dealing with a global pandemic that requires a global vaccination programme, which will inevitably result in some injured individuals. We may be coming to a point where we need to consider whether, and in what circumstances, there is in fact a right to be compensated for some kinds of misfortune. However, such a right potentially conflicts with other rights that are often classified as fundamental, such as the right to access justice via the courts.

INTRODUCTION

Much of the existing research about no-fault compensation funds in general has been focused on the legal benefits and drawbacks compared to a fault-based system. However these studies have been often approached from a sceptical viewpoint – are these funds ever a realistic alternative, in limited cases, to traditional liability (including strict liability) or insurance frameworks? Only recently have there been attempts to undertake comparative law analysis of how successful these schemes are in fact, and what are the core elements of their success – and what are their key problems. An identification of the key pillars of no-fault comprehensive compensation funds allows for the next step of analysis to be undertaken on a more thorough and informed basis – specifically the more precise identification of these schemes’ benefits, their fundamental drawbacks and areas for improvement, and the circumstances to which they are suited (or not).

The comparative law analysis of four large mature systems in the previous chapter enabled an identification of the key characteristics of these big funds, and a limited functional comparison with some relevant European non comprehensive funds. In this chapter, there is an analysis of some the key pillars common to multiple jurisdictions, for the successful establishment, administration, and operation of no-fault comprehensive compensation funds. There is also an assessment of some of the common difficulties and problematic elements of these schemes.

There are many possible key pillars that could be identified, but those most relevant to a comparative legal analysis have been selected. It is interesting to identify and analyse these key pillars because the ACC, the TAC, the SAAQ and the MPI are all mature compensation and liability exclusion ecosystems. There has not been a comparative law study of these four compensation funds as mature, standalone systems that identifies the common key positive and negative elements of their structures. In order to gather further useful information, the funds themselves were surveyed on various aspects of these key pillars. This facilitates an analysis that goes beyond the issues already discussed and also considers the payment of compensation, disputes and funding.

DIFFERENT APPROACHES TO EQUALITY IN LAW

EQUALITY AS A QUESTION OF JUSTICE – FIRST APPROACH

When thinking about “equality”, one almost inevitably falls into the footsteps of Aristotle, who distinguished between similarity – related to a quality – and equality, related to a quantity. Equality, in turn, was a central concept for his doctrine of justice, especially for his conception of an arithmetical equality in the iustitia commutativa.

However, I am more interested here in equality of status, which, following Aristotle ‘ s systematics, should rather be placed with iustitia distributiva, if not with justice in the general sense. However, Aristotle did not accept equality of status.

1.2. A HOPEFUL ENCOUNTER – SECOND APPROACH

Th e greatest conceivable legal inequality manifests itself in slavery. Th ere, the legal personhood of individuals, or a group of people, is simply denied and the person is degraded to a mere thing: the human being is legally degenerated to the status of a thing. The problem of justice that lies therein concerns the unequal treatment of members of the human species who are actually equally qualified. In antiquity, especially in Christianity, people were already sensitive to this, without, of course, drawing any legal conclusions from it. The letter of the apostle Paul to Philemon speaks of Onesimus, a (perhaps runaway) house slave. Paul sends him back to his master, the addressee of the letter. But Onesimus comes back to Philemon as a brother because of baptism, Paul writes:

All the words in this title may seem, if not provocative, at least highly questionable:

• – To say that private law has a foundation.

• – To affirm that it is the equal dignity of human beings that is at its foundation.

I will not dwell here on the first point, which is actually obvious: that private law has a foundation (in the sense of a Grundnorm). This is not a jusnaturalist position, and even less a theological conviction, but a structural and logical necessity. All the greatest philosophers have said so, at least since Aristotle. In law, Kelsen memorably explained it: although the jurist, in a pure theory of law, does not have to concern himself with the Grundnorm, a legal system necessarily presupposes such a logico-transcendental hypothesis. If each norm derives its validity from a norm that is superior to it, things must, at some point, come to a halt with a dogmatic statement of a different nature from the norms laid down. It is futile to try to go beyond this and to try to found the foundation, because the foundation is without foundation. The search for reasons necessarily stumbles upon an ultimate “why” that cannot, in turn, be founded.

I will focus here on the second question, or rather the second assertion, namely that it is the equal dignity of human beings that is the basis of private law. The examination of this question implies the recognition that, contrary to Kelsen’s view, the jurist must be concerned with the question of the foundation. It also means recognising that this foundation is not merely a structural place about which there is nothing to say, but that it must be given substance. The foundation cannot be a simple empty space, a purely formal logico-transcendental condition, or, as those interested in the dignity of the human person sometimes put it, a simple “placeholder”. In other words, something must be said about the substantive content of the Grundnorm.