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Changes to the NSW Civil Liability Act and what this means for Claimants

Changes to the NSW Civil Liability Act and what this means for Claimants

Published on July 18, 2022 by Christiane Al Khoury and Maithri Panagoda AMChristiane Al Khoury and Maithri Panagoda AM

The Civil Liability Amendment (Child Abuse) Act 2002 has recently been implemented in NSW with changes of significance to both claimants and insurers. For claimants in particular, it has been long-awaited.

These amendments to the Civil Liability Act 2002 (“CLA”), will affect both previously settled claims and current claims.

What has changed?

There have been two Parts of the CLA which have been inserted and/or amended, and they can be summarised as follows:

  • Part 1C – Courts will have the power to set aside previous settlements which occurred prior to legislative changes that took place in both 2016 and 2018. These relate mostly to limitation periods and potential defendants.
  • Part 2A – The process and/or threshold used to previously determine the success of certain claims has changed, and we will outline these in further detail below.

What do these changes mean?

So, what do these changes mean for claimants who have suffered abuse in custody when they were under the age of 18?

  1. Part 1C – Setting aside previous settlements

The changes brought about by Part 1C relate to limitation dates and potential defendants.

In order for potential claimants to understand how these changes might affect them, it is important that they have a brief understanding of what the laws were prior to these changes.

Limitation dates and time limits

Prior to 2016, there were time limits in respect of bringing a claim for child abuse. If a claimant was out of time, they would be required to go through a lengthy process and seek an extension of time from the Court in order to bring a claim. However, changes to the Limitation Act NSW (which came into effect in March 2016), now mean that a plaintiff can bring a claim for child abuse at any time, regardless of how long ago the abuse occurred.

The insertion of Part 1C into the CLA means that a court may set aside a judgement or settlement which was entered into prior to the removal of the limitation period in 2016, and which was subject to an expired limitation period when it was entered into or handed down.

Potential defendants

In 2018, Part 1B was inserted into the CLA which means:

  • There is now a statutory duty of care to prevent child abuse imposed on certain institutions that exercise care, supervision or authority over children (for example, a juvenile justice centre);
  • Vicarious liability was extended to non-employees of institutions if they fit a similar criteria to an employee; and
  • A claim could be brought against an unincorporated association, as long as the defendant has suitable assets.

Part 1C of the CLA now allows the Courts to set aside judgements or settlements that were entered into prior to the insertion of 1B in 2018 on the basis that the claims:

  • Involved an unincorporated organisation that would have been liable if Part 1B existed at the time
  • The agreement is no longer considered just and reasonable (there are many reasons why this would be the case)

In considering whether setting aside the previous judgement is in fact reasonable and just, under section 7D(3), the Court may take into consideration the amount previously paid to the plaintiff, the conduct of both the parties and their legal representatives, the bargaining positions of the parties and any other matters the court may consider relevant of course.  In considering the conduct of the parties, the Court may also allow the parties to rely upon evidence that would typically be prohibited, such as “without prejudice” communications used in earlier negotiations.

Potential Claimants should always keep in mind that this is a very complex area of the law, and not all claims are dealt with or viewed in the same light as others.

In the case that any of these situations apply, there are many matters which the Court may consider relevant in coming to a decision about whether to set aside the previous settlement. Of course, not all judgements will be eligible to be set aside and it will be at the Court’s discretion.

Changes relevant to those in Custody

  1. Changes to Part 2A – Offenders in Custody

There have also been significant changes to the CLA relating to child abuse suffered in custody.

Prior to these recent changes, child abuse claims brought by offenders in custody at the time of the abuse were subject to Part 2A of the CLA. This meant that:

  • The claimant would need to meet a minimum threshold of 15% whole person impairment to be eligible to receive damages as a result of the alleged abuse.
  • If the claimant was awarded damages as a result of the claim (which was not always guaranteed), then the settlements funds would be paid into a trust account and any potential victims of the claimant could claim damages from the claimant (for example, if they had assaulted another person in custody).

For more detailed information on changes to Part 2A of the CLA, please refer to the following article by our Emily Katheklakis, Partner, “Recent Developments for Child Abuse Suffered in Custody”.

Please contact Emily Katheklakis if you have any questions or enquiries regarding claims under the above sections of the Civil Liability Act 2002.
Contact details:
Phone: 02 9291 7194

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