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17 January 2017
Apology legislation has long been in force in other common law jurisdictions, such as the United Kingdom, Canada, Australia and the United States. In Hong Kong, however, the need for apology legislation was raised only in 2010.
Disputes often involve situations where one party feels strongly that it has been wronged by the other. A simple apology may go a long way towards defusing the situation or at least reducing the scope of dispute. However, a party involved in a dispute will usually be advised not to apologise for its actions, as this may amount to an admission of liability (this is a common problem in claims involving allegations of discrimination). Where a party is insured under an insurance policy, there will be additional risk in offering an apology, because the policy will normally prohibit the admission of fault by the insured. An apology may therefore lead to coverage being refused.
There is no comprehensive law in Hong Kong which defines what is meant by an 'apology'; nor is there any legislation setting out the legal consequences of making an apology. The mere fact that a party has made an apology is unlikely to determine its legal liability. Nevertheless, there seems to be a common perception that an apology automatically amounts to an admission of fault or liability.
From June 22 2015 to August 3 2015, the Department of Justice issued the first round of public consultations(1) on introducing apology legislation in Hong Kong. The primary objective of the legislation is to promote the making of apologies in order to facilitate the settlement of disputes in the civil and non-criminal context by clarifying the legal consequences of making an apology. From February 22 2016 to April 5 2016, a second round of public consultation(2) took place. The Steering Committee concluded its final recommendations after considering responses to the consultation papers.
The proposed Apology Bill(3) effectively encourages apologies by removing legal disincentives to apologising (making an apology inadmissible in lawsuits and ensuring that insurance coverage is not affected), with the aim of promoting the settlement and resolution of disputes and reducing litigation.
At present, it is possible for an apology to be admitted in evidence in civil proceedings to prove the matters stated in the apology in order to establish legal liability. However, Clause 8(1) of the Apology Bill alters this position, as follows:
"8. Admissibility of evidence of apology
(1) Evidence of an apology made by a person in connection with a matter is not admissible in applicable proceedings as evidence for determining fault, liability or any other issue in connection with the matter to the prejudice of the person"
Currently, only Canada provides legislation where an apology does not constitute an acknowledgement of liability or void or otherwise affect insurance coverage.(4) The Apology Bill includes provisions of this nature. Clause 10 of the Apology Bill expressly provides that an apology shall not affect any insurance coverage that is, or would be, available to the person making the apology:
"10. Contract of insurance or indemnity not affected
(1) An apology made by a person in connection with a matter does not void or otherwise affect any insurance cover, compensation or other form of benefit for any person in connection with the matter under a contract of insurance or indemnity.
(2)This section applies regardless of whether the contract of insurance or indemnity was entered into before, on or after the commencement date of this Ordinance.
(3)This section applies despite anything to the contrary in any rule of law or agreement."
This directly prevents an apology from voiding or affecting insurance contracts. It is therefore an important element in the proposed apology legislation.
The new apology legislation potentially has far-reaching consequences for the resolution of legal disputes. While an apology may not resolve all of the issues in dispute, it can take some of the heat out of the dispute and may facilitate a subsequent settlement - particularly if it is made at an early stage. There are clear advantages for insurers in the enactment of this legislation, as they will not need to be concerned with expressions of regret prejudicing the defence of a claim. Insurers will also benefit from any consequent positive effects that the apology has on the claim. The new legislation will also narrow the scope for disputes with insureds over policy coverage.
For further information on this topic please contact Kevin Bowers or Michael Withington at Howse Williams Bowers by telephone (+852 2803 3648) or email (email@example.com or firstname.lastname@example.org). The Howse Williams Bowers website can be accessed at www.hwbhk.com.
(1) Consultation Paper: Enactment of Apology Legislation in Hong Kong (2015) (www.doj.gov.hk/eng/public/pdf/2015/apology.pdf).
(2) Enactment of Apology Legislation in Hong Kong: Report and Second Round Consultation (2016)(www.doj.gov.hk/eng/public/pdf/2016/apologyreport.pdf).
(3) Enactment of Apology Legislation in Hong Kong: Final Report and Recommendations (2016) (www.doj.gov.hk/eng/public/pdf/2016/pr20161128e1.pdf).
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