Compensation Funds



Click here to read CLAN's submission into the Government's Review for Compensation Payments

A Victorian CLAN member, Angela Sdrinis, has written this especially for CLAN, as a response to the Senate Report “Forgotten Australians”. The recommendation she is referring to in particular is :

Recommendation 6: That the Commonwealth Government establish and manage a national reparations fund for victims of institutional abuse in institutions and out-of-home care settings.

The Senate Inquiry into Children in Institutional Care made a number of recommendations but most importantly it recommended that a compensation fund be set up to compensate victims of abuse whilst in care.

Victims need to see the perpetrators punished and more importantly to be satisfied that they are not involved in ongoing abuse of other children. Victims also need closure which can only be provided where there is redress ie punishment of the perpetrator, acknowledgment, a sincere apology and compensation.

Unfortunately, under current legal arrangements there is no guarantee that any of these needs will be met and that is largely because victims of abuse whilst in institutional care face significant legal barriers.

All Australian states have Statutes of Limitations which limit the time within which legal proceedings can be issued in relation to claims for damages for personal injuries. The harshness of this legislation varies from state to state.

Generally, the law allows for an extension of time to be granted. The circumstances in which such extensions will be granted are however extremely restrictive in most jurisdictions. Applications for an extension of time within which to issue proceedings are costly and there is no guarantee that leave to issue proceedings will be granted.

The nature of the injuries suffered by victims of abuse means that it is often decades after the actual abuse has occurred before individuals have the psychological fortitude to investigate these claims.

If the victims seek to bring a claim for damages at this point, there can be no guarantee that an extension of time will be granted.

The cost of an extension of time application will be $10,000 to $15,000 for each side. If the application is unsuccessful, the Applicant in addition to his/her own legal costs will be liable for the other side’s legal costs. Accordingly, an extension of time application can be a very expensive gamble. Even if proceedings are brought within time or an extension within which to issue is granted, claims for damages face significant other impediments.

In order to be entitled to damages a claimant must show that s/he has suffered injuries as a result of the negligence of another party. To prove negligence, a claimant must establish that they are owed a duty of care and that there was a breach of duty of care which has resulted in injury.

Many victims of abuse either come from a dysfunctional background or become totally dysfunctional because of the abuse. Where injury has occurred, Defendants often argue that it is not the abuse that has caused the injury. Defendants argue that these individuals were already significantly physically or psychologically damaged, or became so subsequently and it is impossible to “unscramble the eggs” and therefore identify the cause of any ongoing symptoms, loss or damage as being directly caused by the abuse.

Where injury can be established as being caused by the Defendant, the argument will then centre around whether notwithstanding the abuse, a religious or state run organisation is actually legally liable for the conduct of it’s agents or employees.

An organisation does not rape a child. Individuals are abusers but in the normal course of events, claims are brought against the organisation who had a duty to protect the individual in its care.

Accordingly, when these claims are brought the organisation will argue that it did not know that the conduct was occurring and will simply seek to blame the individual abuser and say the organisation had no way of knowing the conduct was occurring.

Given that many of these claims are brought years after the event, it is often extremely difficult to show that the responsible authority either knew or should have known the abuse was occurring. Various government departments and religious institutions in whose care children were placed will argue that they had no way of knowing the extent and the nature of the abuse.

Further the abuse relates to illegal conduct. In these circumstances, the employing agency will argue that they cannot be held liable for the illegal conduct of their employees or agents. This argument has met with considerable legal success. As recently as February of last year the High Court considered the extent to which authorities could be liable in negligence where there was no allegation of fault by the authority but where injury had occurred as a result of the misconduct of an employee.

The High Court found that a non delegable duty of care did not extend to illegal conduct or conduct where an employee was pursuing a “frolic of their own” to use the absurd wording of the decision itself. (NSW v Lepore/Samin v Queensland/Rich v Queensland [2003]HCA 4).

In addition, even though many of these children were wards of the state, the state has argued that they fulfilled their duty by placing the children in their care in “reputable” institutions. Many children were placed in the care of the Catholic Church and its religious orders or in other Church institutions.

In other words, government authorities have argued that they complied with their obligations to these children by placing them in “reputable” hands and that it was therefore unnecessary to do more than receive regular paper work. That is, there were no systems for the ongoing independent auditing or inspection of these facilities and arguably no obligation to do so under the social welfare legislation at the time.

It is well documented that the Churches on the other hand allowed many of the children in their care to be subjected to the most horrific physical and emotional deprivation and in many cases to serial and significant sexual abuse.

Notwithstanding these horror stories, the Catholic Church in particular denies it can be sued because they argue they are not legal entities merely religious associations.

The affairs of the many Church groups and their religious orders have been organised in such a way that they are legally incorporated for the sole purpose of the owning and disposing of property and for the accumulation of wealth but otherwise Churches argue that they have no more legal standing than a social group at the local tennis club.

Again these arguments have met with some success in the Courts and the inability to find an entity that can actually be sued further aggravates the problems faced by those seeking redress.

Further, where wards of the state have been placed in these religious institutions by the state, a process of duck shoving responsibility takes place with the state trying to blame the church and vice versa.

The other significant impediment faced by potential claimants is the cost of litigation. Many talk of an American style system where litigation is out of control. This couldn’t be further from the truth as far as these claims are concerned.

Because both Governments and Churches have played hard ball, many lawyers are dissuaded from even contemplating litigation. Where proceedings are issued both the state governments and the churches brief lawyers from the top of end of town who spend a fortune in strike out applications and other devices to delay a claim and to increase costs.

Because of the background of most of the claimants, they are significantly disadvantaged and simply do not have the resources to fight these cases. Lawyers who represent these victims, who many call ambulance chasers, have to fund these claims and often despite how difficult such decisions can be proceedings are withdrawn or discontinued because they prove too costly. For example, a claim in the district courts or various state Supreme Courts where these proceedings are issued can cost many tens of thousands of dollars.

Whilst some Church groups have set up compensation panels, the panels have very limited powers to award compensation. Money is always paid with a denial of liability. Apologies are mealy mouthed and extremely general. Until recent events and the community outcry, a term of settlement was inevitably a confidentiality clause which left claimants feeling demeaned and that all they’d received was “hush money”.

Further whilst the church organisations who have set up compensation systems say it is about compensating the victims, it is really about controlling the process. The fact is victims go to these panels virtually cap in hand because they know that if they litigate they will face the difficulties outlined above.

These internal compensation processes often leave the victims again feeling powerless and further abused. There is no doubt that we need to find an alternative.

A number of overseas governments with common law type systems like ours have recognised that the current systems of compensation are failing these victims. Most recently, because of a sense of community outrage and following a detailed Inquiry, the Republic of Ireland has set up a fund to provide redress to victims of institutional abuse.

The Republic of Ireland is a small country and not very wealthy. Notwithstanding this, the Irish Government has put aside a substantial amount of money to provide monetary compensation but just as importantly has accepted responsibility for the pain, misery, humiliation and neglect suffered by the children of Ireland who were placed in its care.

The Senate Inquiry had done its job and it has concluded that there has been a systemic failure to protect children in the state’s care and that as a result of this failure many Australian citizens have been significantly damaged at a huge and ongoing cost to the Community. The Government should now do its job and undertake to implement each and every recommendation.

Personal Injuries Accredited Specialist
Ryan Carlisle Thomas