Pearce v Missionaries of the Sacred Heart

In Pearce v Missionaries of the Sacred Heart, the plaintiff sought to set aside a prior settlement agreement with the defendants, the Missionaries of the Sacred Heart, in relation to claims of sexual abuse. The plaintiff, who was a victim of sexual abuse, entered into a settlement agreement with the defendants in 2019. However, subsequent to the settlement, the plaintiff sought to set aside the agreement on the basis of unfairness and the unavailability of a corporate entity to sue at the time of settlement. The dispute came before the Supreme Court of Victoria.

The legal issues before the court included whether the settlement agreement was just and reasonable under the relevant provisions of the Organisational Child Abuse (Vic) Act 2018, and whether the plaintiff's decision to enter into the agreement was influenced by the so-called Ellis defence. The court was also required to consider the effect of the settlement agreement on the plaintiff's claim for economic loss, which was not included in the prior claim.

The court found that the settlement agreement was not just and reasonable in all respects. Specifically, the court found that the agreement was not just and reasonable in relation to the plaintiff's claim for general damages and medical expenses. However, the court found that the claim for economic loss was extinguished by the deed of settlement, as it was not included in the prior claim. The court also found that the Ellis defence did not inform the plaintiff's decision to enter into the agreement. The court considered the cases of Roman Catholic Trusts Corporation for the Diocese of Sale v WCB [2020] VSCA 328 and TRG v Board of Trustees of Brisbane Grammar School [2019] QSC 157 in reaching its decision.

The court ordered that the settlement agreement be set aside in part, specifically in relation to the plaintiff's claim for general damages and medical expenses. The court did not set aside the agreement in relation to the claim for economic loss, as it was not included in the prior claim. The court also found that the Ellis defence did not inform the plaintiff's decision to enter into the agreement. This decision provides guidance to parties entering into settlement agreements in relation to claims of sexual abuse, and the factors that the court will consider in determining whether such agreements are just and reasonable.