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Making the Covid-19 Vaccine Injury No-Fault Compensation Scheme work

14 May 2021 Norton Rose Fulbright
Donald Dinnie, Norton Rose Fulbright

Donald Dinnie, Norton Rose Fulbright

The Covid-19 Vaccine Injury No-Fault Compensation Scheme rules were published under the Disaster Management Act last month. The regulations establish that scheme under the auspices of the National Department of Health.

The stated purposes of the scheme is to provide for the expeditious and easy access to compensation for persons who suffer vaccine injury by the government as a consequence of the administration of a duly registered Covid-19 vaccine.

The Covid-19 Vaccine Injury Compensation Fund is also established.

The success of the scheme and the fund lies in details still to be published and their prompt and efficient implementation. The directions still to be issued by the Minister of Health must not be inconsistent with the constitutional rights of claimants.

The eligibility criteria envisage claims by both a person who has directly suffered harm, loss or damage caused by a vaccine injury or a dependent of a deceased person who has suffered harm, loss or damage caused by the death of that deceased person caused by the vaccine.

The vaccine injuries must be causally related to the relevant vaccination. So the claimant will still have the onus of establishing the causal connection on the balance of probabilities. That may not be an easy thing to do. The regulations do not require any defect in the vaccine to be established. Nor does the scheme (it’s in the title) require fault to be established on the part of any vaccine manufacturer, importer, distributor or retailer nor the administrator of the vaccine.

In that regard the provisions are not dissimilar from the provisions of section 61 of the Consumer Protection Act which provide for strict liability for damage caused by goods which would include vaccines. Under section 61 fault need not be established. Causation must be. A section 61 claimant would have to prove that the harm was caused wholly or partly as a consequence of the supply of an unsafe vaccine, vaccine failure, defect or hazard in the vaccine as defined. No fault on the part of the producer, importer, distributor or retailer need to be established. The practical distinction in establishing a claim under the scheme as opposed to section 61 may be negligible in a claim based on the nature of the vaccine. The scheme extends liability to the consequences of the manner in which the vaccine is administered.

A claim under section 61 would have to be pursued in the courts with its attendant costs and delays. A scheme claim will be dealt with by an adjudication panel, causality panel and quantum panel. The existence of four different panels (there is also an appeal panel) points to a number of procedural, and potentially laborious and costly hurdles for a claimant.

Procedural directions for submitting claims and the causality and quantum adjudication thereof still have to be determined. Success of the scheme will depend on a user-friendly, easily accessible and low cost process for claimants with quick turnaround times. The relevant directions should specify fixed and reasonably short time periods for conclusion of the claims process, adjudication and any appeal. A claimant dissatisfied by the rejection of a claim or the quantum and structure of compensation determined can appeal the decision to the appeal panel.

Where a person submits a claim to the scheme they waive and abandon their rights to institute legal proceedings in a court against any party for a claim arising from harm, loss or damage allegedly caused by the vaccine injury. The regulations do not prevent litigation being instituted and then abandoned in order to submit a claim to the scheme. So the regulations do not prohibit a claimant from proceeding in court under section 61 of the Consumer Protection Act, the common law or otherwise against any third party which the claimant alleges is responsible for their harm suffered. That may be of limited comfort to manufacturers, importers and distributors of Covid-19 vaccines which under the scheme regulations have no absolute protection from litigation although some have reportedly been indemnified by government against claims.

To what extent claimants choose to avail themselves of the scheme rather than litigate will in part be dependent on the cost effective, accessible and timeous claims process referred to above and the extent of the loss.

It will also be dependent on what type of compensation and structure thereof the claimant is likely to receive.

Directions are still to be issued specifying the quantum and structure of compensation that will be provided. That hints at compensation that possibly will not provide a complete indemnity to the claimant in respect of the harm suffered and which may not be payable by way of lump sum. It is unclear whether the proposed structure contemplates periodic payments or even compensation by way of services or a voucher for services.

Where a claimant perceives that in those circumstances they will not be properly compensated by the scheme for their harm litigation may become a more attractive option and undermine any attractiveness of the scheme.

The regulations also do not record expressly whether the claims are subject to the normal three year prescription period or a different period nor do they require a claim to be made within a particular period of suffering the harm. The regulations do state that the scheme will not cease to operate merely because the state of national disaster comes to an end and it will continue to operate and be in force until an appropriate notice is published terminating the scheme and all pending claims are finalised. Clarification is needed.

Details are awaited in the published directions. That particularly will determine the attractiveness and success of the scheme, as will the efficient implementation thereof.

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