I introduction

G Prospective or Retrospective Reform?
Consideration must be given to the critical question of whether reforms to impose institutional liability should be prospective only or given retrospective operation. The Royal Commission has stipulated that its proposed statutory reforms should have prospective application only.¹⁴⁵
The law has an appropriate and abiding caution with respect to retrospective law reform, which sits uneasily with the rule of law. It is considered to be potentially prejudicial to parties who may have arranged their affairs based upon the state of the law at the time and has particular significance in relation to criminal liability.¹⁴⁶ However, there are several reasons why exceptional consideration should be given to retrospective reform of civil liability of institutions for child sexual abuse.
The most significant reason is that if comparable changes were made to the common law by the courts, they would have retrospective effect anyway, as acknowledged by the Royal Commission.¹⁴⁷ In the United States Supreme Court in Kuhn v Fairmont, Holmes J observed that ‘[j]udicial decisions have had retrospective operation for near a thousand years’.¹⁴⁸ This has already occurred in other jurisdictions that have clarified the scope of vicarious liability. However, the Royal Commission suggests that legislation should be enacted to avoid the likelihood that Australian courts go down a similar path.¹⁴⁹ The Royal Commission reasoned that retrospective application was not appropriate because ‘relevant institutions would face potentially large and effectively new liability for abuse that has already occurred’,¹⁵⁰ and that retrospective insurance would be in all likelihood unaffordable, and referred to ‘the burden that retrospective change would impose on insurers or institutions that will not have insured against this liability’.¹⁵¹ These issues are undeniable. However, the Royal Commission did not explain why they warrant a different approach in Australia to other common law jurisdictions which have already expanded vicarious liability with retrospective effect.
With respect to difficulties in defending proceedings arising from significant effluxion of time from the date of alleged abuse, courts have the power to stay any proceedings in which prejudice could be established. However, without retrospective operation for institutional liability, a significant proportion of the claims of those survivors who might be in a position to bring proceedings would be unmaintainable. Retrospective reform to limitation periods alone as proposed by the Royal Commission will be of very limited utility to existing survivors if they have no sustainable cause of action. They will be in the same position they are now.
The Royal Commission’s recommendations assume the implementation of a national redress scheme, which would certainly afford some financial compensation to survivors of past abuse. On one level, this appears to reduce the need for retrospective reform. However, there is no guarantee that the redress scheme will be implemented in the manner proposed by the Royal Commission, and even if it is, the justification for denying retrospective reform by statute which could be achieved in a similar manner by common law development is not clear. This is particularly so where in other common law jurisdictions, survivors of past abuse already have access to such retrospective action.
Another issue for legislators to consider is that it is not necessary to limit consideration of retrospectivity to the particular statutory reforms proposed by the Royal Commission. An option would be the implementation of a statutory vicarious liability for survivors of past abuse in a manner comparable to the vicarious liability imposed in other common law jurisdictions with retrospective operation, even if other reforms such as the proposed duty and statutory liability are enacted with prospective operation only. This would give Australian survivors of past abuse comparable rights to those which exist currently in other jurisdictions; not greater, but not less, as is currently proposed by the Commission.