Permanent Stays: Impact of Stayed Cross Claim

29 September 2022
Warning: This article contains details about sexual assault and abuse which may be upsetting for some readers. Reader discretion is advised.

New South Wales Supreme Court orders a permanent stay of proceedings on both the cross-claim and plaintiff’s claim in historical abuse matter.

In issue

  • The New South Wales Supreme Court had to consider whether the permanent stay of a cross-claim against the alleged perpetrator of sexual abuse, on the basis of legal incapacity, would result in such prejudice against the remaining defendant that a permanent stay should also be granted.

The background

The plaintiff alleges to have been abused the cross-defendant, who was a priest at the time, whilst he was a resident of a North Coast Children’s Home (‘the home’) between 1974 and 1975. During the relevant period the Corporate Trustees of the appropriate Diocese (‘the defendant’) operated the home. Upon being served with proceedings, the defendant issued a crossclaim against the cross-defendant.

The cross-defendant is noted to have been subject of documents produced to the Royal Commission and was convicted of indecent assault in 1968. He also pled guilty to the indecent assault of a male in 2002 relating to a period of abuse of 1975 and 1976. The cross-defendant retired as a priest in 2000.

The cross-defendant filed a motion for the appointment of his wife as tutor of the claim in circumstances that he was suffering from Alzheimer’s Disease and exhibited no understanding of the documents which had been served on him. Further, the motion sought a permanent stay of the cross-claim on the basis that his medical condition prejudiced his ability to respond to the claim.

The defendant then filed its own motion which sought a permanent stay of the plaintiff’s proceedings on the basis that 'if the court was satisfied the condition of the cross-defendant was such that he could not contest in any meaningful way the allegation against him that he sexually abused the plaintiff, then in those circumstances the position of the Trustees was identical'. It was also submitted that in circumstances where the plaintiff would seek to rely on evidence which occurred after the alleged abuse, as tendency evidence, the defendant had lost the ability to obtain evidence from the cross-defendant, to defend such claims.

The decision

The court elected to hear the motions concurrently. The cross-defendant produced significant evidence in the support of the allegation of medical incapacity and the court was satisfied that the condition restricted the cross-defendant’s ability to respond to the claim and ordered a permanent stay.

The Court then held that the defendant did not have sufficient facts or information or knowledge that would permit it to participate in a contest against the plaintiff about whether a sexual assault, or sexual abuse of the kind alleged occurred. It was also noted that the defendant did not possess any materials which outlined the basis on which the plaintiff was residing at the home. The plaintiff’s claim against the defendant was therefore also permanently stayed.

His Honour made orders as follows:

  • The motion of the cross-defendant be granted, being the appointment of the cross-defendant’s wife as tutor due to the medical condition rendering him as having no legal capacity and further granted a permanent stay of the cross-claim
  • The motion of the defendant be granted, being the permanent stay of the plaintiff’s proceeding.

Implications for you

The decision shows the importance of considering the value in which issuing a cross-claim against an alleged perpetrator may bring outside of financial contribution. The issuing of a cross-claim against the perpetrator where there is suspicion of legal incapacity due to significant cognitive decline or medical condition then burdens that individual to establish prejudice in responding to the claim. The defendant may subsequently be able to rely on same in pursuit of a permanent stay of the primary claim.

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