Xavier (a pseudonym) v Trustees of the Marist Brothers - [2024] ACTSC 141

SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Case Title:	Xavier (a pseudonym) v Trustees of the Marist Brothers
Citation:	[2024] ACTSC 141
Hearing Date:	6-8 May 2024
Decision Date:	9 May 2024
Before:	Baker J
Decision:	(1) The deed of release between the Plaintiff and the Defendant dated 26 August 2010 be set aside; and (2) The costs of the application be costs in this cause.
Catchwords:	CIVIL LAW – PRACTICE AND PROCEDURE – Application to set aside deed of release – child sexual abuse - potentially relevant documents not in the possession of the plaintiff at the time of the agreement – whether the deed of release is a just and reasonable agreement - deed of release set aside
Legislation Cited:	Civil Law (Wrongs) Act 2002 (ACT) ss 114K, 114K(3)(a), 114L, pt 8A.3 Evidence Act 2011 (ACT) s 131
Cases Cited:	Walsh (a pseudonym) v Trustees of the Roman Catholic Church for the Archdiocese of Canberra and Goulburn [2024] ACTSC 81
Texts Cited:	Royal Commission into Institutional Responses to Child Sexual Abuse (Redress and Civil Litigation Report, September 2015) Royal Commission into Institutional Responses to Child Sexual Abuse (Report of Case Study No 13, November 2015)
Parties:	Claude Xavier (a pseudonym) (Plaintiff) Trustees of the Marist Brothers ( Defendant)
Representation:	Counsel D Campbell SC with J Ronald ( Plaintiff) L Gyles SC with N Bentley ( Defendant)
Solicitors Porters Lawyers ( Plaintiff) Carroll & O’Dea Lawyers ( Defendant)
File Number:	SC 421 of 2023

BAKER J:

Introduction

In 2009, the plaintiff, Claude Xavier (a pseudonym), brought proceedings seeking damages for personal injury in relation to breaches of duty and assault by Trustees of the Marist Brothers (“the defendant”) and others. The plaintiff alleged that he was sexually abused on three occasions between 1989 and 1990 by a teacher employed at Marist College Canberra while he was a student at the College. The plaintiff claimed that at the time of the alleged assaults, the defendant knew that the teacher had a history of sexually abusing boys at its schools, including Marist College Canberra. He sought damages for psychiatric injury. On 26 August 2010, the plaintiff, the defendant and several others settled this claim by way of a Deed of Release for $50,000 inclusive of costs and disbursements (“the Deed of Release”). A notice of discontinuance was subsequently filed on behalf of the plaintiff 18 October 2010.
By way of application, the plaintiff now seeks orders that the Deed of Release between himself and the defendant be set aside pursuant to ss 114K and 114L of the Civil Law (Wrongs) Act 2002 (ACT) (“Wrongs Act”).
This application was heard before me on Monday, 6 May 2024. At that hearing, the plaintiff gave oral evidence, and various documents were tendered on behalf of the plaintiff and the defendant. The documents tendered on behalf of the plaintiff included documents apparently obtained from the Royal Commission into Institutional Responses to Child Sexual Abuse (Report of Case Study No 13, November 2015), which were potentially relevant to both liability and quantum of damages. It is accepted that the plaintiff did not have access to those documents at the time that he entered into the Deed of Release.
A similar application, involving the same defendant and a different plaintiff, was heard before me on Tuesday 7 May 2024. As the matters raised the same issues concerning the proper construction of s 114K of the Wrongs Act, it was agreed that I would hear submissions in both matters concurrently on Wednesday 8 May 2024.
The defendant initially opposed the relief sought in the present application. However, after considering the further documents that were tendered in the plaintiff’s case on Monday 6 May 2024, the defendant advised the Court that it no longer opposes the grant of the relief sought. At the hearing on Wednesday 8 May 2024, Mr Gyles SC, who appeared for the defendant, advised the Court that the defendant accepts, for the purposes of the present application, that:
(a)The Deed of Release is an abuse settlement agreement for the purposes of pt 8A.3 of the Wrongs Act;
(b)Documents exist which were potentially relevant to issues of liability and quantum which were not in the possession of the plaintiff at the time of the mediation and the earlier proceedings; and
(c)In those circumstances, the plaintiff, on this application, has satisfied s 114K of the Wrongs Act, and the Court may set aside the agreement on the basis that is not just and reasonable.
For the reasons briefly outlined below, I agree with these submissions. It follows that the orders sought in the application should be made.

Consideration

Section 114K of the Wrongs Act provides as follows:
114K Court may set aside abuse settlement agreement
(1)This section applies if a person (the applicant) is prevented from exercising an action on a cause of action because of an abuse settlement agreement.
(2)The applicant may—
(a)begin a proceeding on the cause of action in a court with jurisdiction to hear the proceeding; and
(b)apply to the court to set aside the agreement.
(3)The court may set aside the agreement if the court is satisfied that—
(a)when the agreement was made there were legal barriers to the person being fully compensated through a legal cause of action; or
(b)when the application is made to set aside the agreement, the agreement is, in all the circumstances, not a just and reasonable agreement.
(4)The court may consider the following in deciding whether to set aside the agreement:
(a)the amount paid to the applicant under the agreement;
(b)the bargaining position of the parties to the agreement;
(c)the conduct of the following people in relation to the agreement:
(i) a party other than the applicant;
(ii) a legal representative of a party other than the applicant;
(d)any other matter the court considers relevant.
(5)The Evidence Act 2011, section 131 (1) (Exclusion of evidence of settlement negotiations) does not prevent evidence being adduced in a proceeding begun under this section, even if the evidence is of a communication made, or a document prepared, in connection with an attempt to negotiate a settlement of the dispute to which the agreement relates.
The history of s 114K is discussed by Curtin AJ in Walsh (a pseudonym) v Trustees of the Roman Catholic Church for the Archdiocese of Canberra and Goulburn [2024] ACTSC 81 at [102] – [122] and [164] – [190].
For present purposes, it suffices to note that the provisions were enacted as a part of the ACT response to the Report of the Royal Commission into Institutional Responses to Child Sexual Abuse (Redress and Civil Litigation Report, September 2015): Walsh at [120] – [122]. Specifically, following the Royal Commission recommendations, the ACT legislature removed the limitation period for actions for personal injury resulting from child sexual abuse (s 21C of the Wrongs Act, which came into effect in 2016), and addressed the difficulty in commencing proceedings against unincorporated bodies, institutions and property trusts (ch 8 of the Wrongs Act, which came into effect in 2018). Subsequent to these amendments, in 2022, the legislature enacted pt 8A.3 of the Wrongs Act, which empowers a Court to set aside an “abuse settlement agreement” where the Court is satisfied of the matters specified in s 114K(3) (extracted at [7] above).
There are a number of aspects of s 114K that were the subject of contention in the proceedings before Curtin AJ in Walsh. These included whether the reference to “legal barriers” in s 114K(3)(a) referred to actual or potential legal barriers; and whether the “or” in s 114K(3) should properly be read as an “and”, such that a plaintiff must demonstrate both that there were legal barriers to the achievement of full compensation and that the agreement is, in all the circumstances, not a just and reasonable agreement: Walsh at [158] – [212].
Acting Justice Curtin concluded that the phrase “legal barriers” in s 114K(3)(a) should be read as referring to any potential legal barriers (including a limitation defence that has not been pleaded by the defendant). His Honour further concluded that the word “or” should be read literally, so that satisfaction of either ss 114K(3)(a) or 114K(3)(b) will suffice to enliven the provision.
At the outset of the hearing on Monday 6 May 2024, Mr Gyles SC indicated that the defendant would be submitting that Walsh was wrongly decided. This submission was not ultimately developed. Rather, as a result of the defendant’s concessions, it is agreed that it is not necessary for me to consider the correctness of any of the conclusions reached in Walsh concerning the proper construction of s 114K of the Wrongs Act.
In the present proceedings, the defendant did not challenge Curtin AJ’s conclusion that the word “or” in s 114K(3) should be read literally. Accordingly, a conclusion that the agreement is not, in all of the circumstances, a just and reasonable agreement is sufficient to enliven the court’s power to set aside the agreement.
The defendant concedes that, in circumstances where potentially relevant documents were not in the possession of the plaintiff at the time of the making of the Deed of Release, it is open to the Court to conclude that “the agreement is, in all the circumstances, not a just and reasonable agreement”.
I agree. The assessment of whether the agreement is “just and reasonable” is to be made as at the date that the application to set aside the agreement is made. As noted above, there is unchallenged evidence that, at the time of entering into the Deed of Release, the plaintiff was not in possession of documents which were potentially of importance both in establishing the defendant’s liability and concerning the quantum of damages. The absence of these documents could have had a significant impact on the plaintiff’s ability to negotiate an appropriate settlement.
It is not necessary for me to make any findings as to why the plaintiff was not in possession of those documents (for example, whether the documents should have been produced during discovery). Rather, in circumstances where the issue is conceded by the defendant, it suffices for me to conclude that where potentially important documents were not in the plaintiff’s possession at the time the agreement was made, the agreement made is not “just and reasonable” as assessed at this time. It follows that the Deed of Release should be set aside.
In these circumstances, it is not necessary, or appropriate, for me to consider the proper meaning of the phrase “legal barriers” in s 114K(3)(a) of the Wrongs Act.

Orders

For the reasons outlined above, the following orders are made:
(1)The Deed of Release between the Plaintiff and the Defendant dated 26 August 2010 be set aside; and
(2)The costs of this application be costs in the cause.

I certify that the preceding eighteen [18] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Justice Baker

Associate: A Watson

Date: 9 May 2024