By Lily McCaffrey
New legislation in Victoria has removed a significant barrier to survivors of institutional child abuse obtaining compensation.
The Legal Identity of Defendants (Organisational Child Abuse) Act 2018 (Vic) prevents unincorporated organisations who hold their assets in trust from invoking the'Ellis defence' to avoid being sued by survivors.
The'Ellis defence' presents a major hurdle for survivors. Although a survivor is able to sue their abuser directly, the abuser may lack sufficient assets or have died by the time an action is commenced. They may therefore look to sue the organisation in which they were abused. However, many organisations are unincorporated and hold their assets in trust. The common law position is that these organisations are not legal entities that can be sued in their own right. This is known as the'Ellis defence' and is set out in the 2007 decision Trustees of the Roman Catholic Church v Ellis (2007) 70 NSWLR 565.
Mr John Ellis attempted to sue Cardinal George Pell on behalf of the Catholic Archdiocese of Sydney and the trustees of the Roman Catholic Church for sexual abuse suffered when volunteering as an altar boy in the 1970s. Mr Ellis had previously attempted to sue his abuser, Reverend Aidan Duggan, but when he died Mr Ellis decided not to pursue a claim against his estate. The New South Wales Court of Appeal held that the Catholic Archdiocese could not be sued as an unincorporated organisation. The trustees could not be sued either, because holding property for the church did not make them subject to all legal claims associated with church activities. As the Court could not identify a proper defendant, Mr Ellis' case was dismissed and he did not obtain compensation.
Explanation of the Act
The Legal Identity of Defendants (Organisational Child Abuse) Act 2018 (Vic) (the Act) was assented to on 5 June 2018. It was introduced as a response to recommendations in the Victorian Parliament's Betrayal of Trust report and the Royal Commission into Institutional Responses to Child Sexual Abuse's 2015 Redress and Civil Litigation Report.
The Act will apply if:
- a plaintiff wishes to commence a claim against an unincorporated non-government organisation (NGO) founded on or arising from child abuse;
- but for being unincorporated the NGO would be able to be sued and found liable for such a claim; and
- the NGO controls one or more associate trusts.
If these conditions are met, the Act enables the NGO to nominate an entity that is capable of being sued to act as a proper defendant to the claim on their behalf and to incur any liability arising from a claim on their behalf. If an NGO fails to nominate a proper defendant within 120 days from the commencement of a proceeding against them, or if the nominated entity lacks sufficient assets and property or is not an entity capable of being sued, then the plaintiff may apply to the court for an order that the claim is to proceed against the trustees of an associated trust of the NGO.
Effect of the Act
The Act therefore abolishes the'Ellis defence'. It means that, in Victoria, survivors of institutional child abuse can be certain they will be able to identify an entity to sue for compensation regardless of that institution's legal structure.
The New South Wales Government has announced that it will follow Victoria's lead and introduce laws to abolish the'Ellis defence' by the end of 2018.
For a confidential discussion, call her direct telephone number (03) 9321 9879.