Privacy breaches: damages for non-economic loss

In two recent decisions the Australian Information Commissioner has awarded monetary damages for non-economic loss as a consequence of breaches of the Privacy Act.

In ‘HS’ and AMP Life Ltd [2015] AICmr 81 the Commissioner concluded that AMP Life had breached the Privacy Act by obtaining copies of income tax returns relating to an insured’s husband even though the policy only covered his wife and he was not notified of AMP Life’s access to the records.

The Commissioner also concluded that AMP Life had breached the TFN Guidelines by not taking reasonable steps to securely destroy or permanently de-identify the complainant’s TFN information.

Although the Commissioner concluded that there was no basis for awarding compensation for economic loss, he awarded $10,000 compensation for non-economic loss for injury to the complainant’s feelings and distress because of the interference with his privacy by AMP’s conduct.

The Commissioner concluded:

I am satisfied that AMP’s unlawful disclosure had a significant impact on the complainant. In deciding the appropriate amount of compensation to award in this matter, I have also placed weight on:

  • the sensitive nature of the personal information, that is financial information, that was collected and disclosed that it was collected and disclosed, without notice from AMP, although it had assured Mr X’s wife in October 2009 it would not pursue the collection of that information without providing that notice
  • that after the collection, it did not notify Mr X, despite being aware from correspondence with Mr X’s wife on a number of occasions that he was concerned to protect his privacy
  • the collection of the TFN, which was not necessary to the investigation being conducted by AMP, and as well as constituting a breach of the NPPs, constitutes a breach of the TFN guidelines and may potentially be found to be an offence under the TAA
  • the responsibility of AMP to have a sound understanding of privacy obligations under the Privacy Act, given the nature of personal information that it collects and uses on a daily basis and its position as a leading insurance and financial institution
  • the responsibility of AMP to ensure that anyone engaged to undertake work on its behalf, in this case the forensic accountant, must have an understanding of their obligations under the Privacy Act, and the TFN Guidelines
  • that Mr X’s personal information was then disclosed to FOS and the TFN continued to be un-redacted.

In ‘HW’ and Freelancer International Pty Limited [2015] AICmr 86 the Commissioner ordered that Freelancer International Pty Limited (a part of the Freelancer Group) pay the complainant $20,000 for non-economic loss caused by the interference with the complainant’s privacy, including $5,000 in aggravated damages for the additional hurt to the complainant caused by the manner in which the interference with his privacy was committed.

The complainant, a freelancer living in Europe, registered with the site in 2009 and then had difficulties in obtaining payment for work done. A bitter protracted relationship with Freelancer followed.

Amongst other things the complainant alleged that Freelancer interfered with his privacy by the unnecessary collection of his IP address information and collecting his personal information unfairly and/or in an unreasonably intrusive way by freezing his user account until the complainant provided the requisite photographic identification.

The Commissioner rejected a claim for economic loss as he could not conclusively determine that any decline in the complainant’s online customer base was as a result of Freelancer’s improper online disclosures of the complainant’s personal information.

However the Commissioner concluded that:

I am however satisfied that a causal link can be established between the revelation to the complainant that Freelancer had been collecting his IP address information and disclosing his personal information online, and the deterioration in the complainant’s psychological wellbeing….

There is no doubt that the improper online disclosures by Freelancer contained negative and hurtful opinions about the complainant and although Freelancer claims these publications did not receive wide currency, they were published online for general public viewing. In my opinion any person would to some degree have been distressed to see such adverse comments about them published online in this way….

I am therefore not prepared to say that Freelancer’s conduct did not involve the disclosure of any sensitive information. I am of the view that in any case information inferring the complainant was a racist was at the very least information of a sensitive nature. Therefore in determining an appropriate award for non-economic loss, I have taken into account that information publicly disclosed by Freelancer included some information that was ‘more sensitive’ than other kinds.

The Australian Financial Review has reported that Freelancer will appeal this decision.

Print Friendly, PDF & Email

Your Compliance Support Plan

We understand you need a cost-effective way to keep up to date with regulatory changes. Talk to us about our fixed price plans.