2 October 2020: Victorian Precedent - Setting Aside Past Deed of Release
WCB v Roman Catholic Trusts Corporation for the Diocese of Sale (No 2)  VSC 639 is the first case in Victoria to be heard under a law passed in September 2019 allowing deeds to be set aside ‘where it is just and reasonable to do so.’ The defendant also put the issue to the court of whether the matter should be permanently stayed, due to the passage of time which would make a trial unfair to the defendant.
The plaintiff alleged he had been abused by Daniel Hourigan, a priest at the Warragul Catholic Church, between 1977 – 1980, such abuse including anal rape. The plaintiff was aged 11 – 14 at the time. The plaintiff reported the abuse to his family in 1986 who in turn reported it to a Father Waters. The Church did some investigations at the time in which Hourigan admitted he was guilty of abusing the plaintiff and another boy. He was sent for psychiatric treatment.
In 1995, police investigated a number of complaints against Hourigan, including that of the Plaintiff, and laid charges against him. Hourigan died three days after he was charged.
The plaintiff issued legal proceedings for compensation in 1996, naming Bishop Coffey as the defendant. Bishop Coffey was not the Bishop at the time of the abuse but the Diocese was not an entity that could be sued. The plaintiff eventually settled his claim for $32,500 by signing a Deed of Release, that is a contract, relinquishing his rights to further legal action against the Defendant.
‘Just and Reasonable’
Keogh J in WCB distinguished from the Queensland case of v Board of Trustees of Brisbane Grammar School  QSC 157 (‘TRG’) which declined to set aside a past Deed. This was on the basis that ‘extrinsic materials’ of the respective cases were very different. In Victoria, the law allowing deeds to be set aside is remedial in nature, intended to benefit victims of child abuse to bring an action for that injury  and remedy injustice .
Keogh J noted that the court may consider various matters in determining whether or not it is ‘just and reasonable’ to set aside a deed . Keogh J stated the following, in summary:
- The circumstances of the settlement are a relevant but not a controlling factor ;
- The alteration of legal rights (i.e. the defendant’s right to rely upon the deed as a bar to suit) is relevant but not a controlling factor ;
- The plaintiff is not required to show compelling reasons as to why it would be just and reasonable to set aside the deed – there is no separate or additional onus ;
- If the previous settlement of the cause of action reflected legal barriers which have since been removed, it may be just and reasonable to set aside the settlement in order to allow the plaintiff to seek adequate compensation ;
- Improvements in law for plaintiffs regarding vicarious liability weighs in favour of setting aside the deed .
Keogh J identified the ‘circumstances of the settlement’ to include factors such as
- Whether there was legal representation;
- The limitations period, if any;
- Liability of the defendant and availability of a proper defendant;
- The disadvantaged bargaining position of the plaintiff .
The effect of the lapse of time, specific prejudice and availability of a fair trial may be relevant to an application for a permanent stay on proceedings, not to the issue of setting aside the deed , . A party is entitled to a fair trial, not a perfect one . Keogh J concluded that there should not a permanent stay on the proceeding.
This is a case which should give hope to victims who have signed deeds of release for inadequate settlements in hostile legal environments. Keogh J stated:
The case settled for significantly less than its worth because of the legal barriers it faced. It is precisely the sort of case that Parliament intended be given the opportunity to be pursued for proper compensation. There is nothing raised by the defendant in this case about the settlement or the settlement process that suggests that it was anything other than an inevitable result of reliance by the defendant on barriers to the plaintiff’s action which have since been removed.