I introduction

VI COMMON LAW RIGHTS UNDER A REDRESS SCHEME

Finally, we consider whether, if a redress scheme is implemented, survivors of past abuse should retain their common law rights if they receive payment under the scheme. The Royal Commission has recommended that a single national redress scheme be established by the Australian government with the cooperation of states and territories.²⁴⁸ The Royal Commission recommends that an applicant receiving a payment pursuant to the scheme be required to release the scheme and the contributing government and the relevant institution from any further liability for the abuse.²⁴⁹ The applicant would be required to sign a deed of release and would be provided with limited fixed-price legal advice funded by the scheme before accepting the scheme offer and signing the release.²⁵⁰ Of course, it is a basic tenet of the common law that a person should not be compensated twice for a single loss and clearly double recovery should be prohibited. But it is not necessary to require survivors effectively to make an election between a claim against a redress scheme and a common law claim to avoid double compensation. A fairer arrangement would be to require a survivor who had obtained a payment under a redress scheme to refund the payment upon subsequent recovery of common law damages in respect of the same abuse for which the scheme payment was received.²⁵¹

The Royal Commission was persuaded that survivors should be required to give up their common law rights because the scheme was seen as an alternative to litigation rather than an addition to it. Given that the Commission has stated that the payments pursuant to the proposed redress scheme ‘should not attempt to be fully compensatory or to replicate common law damages’,²⁵² there is an apparent contradiction where receipt of a payment under the scheme would extinguish a claimant’s common law right to sue for damages, especially as the scheme would not offer sums comparable in value to common law damages.²⁵³
The Royal Commission was further influenced by the practical consideration of increasing the likelihood that institutions and insurers would respond favourably to the proposal for a scheme if payments extinguished common law rights.²⁵⁴ Such an approach may be pragmatic but it does not necessarily best serve the interests of fairness for survivors of abuse.
The Commission emphasised the likely increased costs to the scheme if common law rights were preserved because the Actuaries Institute had submitted that the costs of ‘no-fault schemes’ increased where common law entitlement coexisted.²⁵⁵ In the context of recommending a universal scheme for disability care and support, the Australian Productivity Commission emphatically stated that avoidance of double compensation involves ‘significant, unavoidable administrative complexities and high costs’²⁵⁶ where an injured person receives financial compensation for injury as well as having access to taxpayer-funded social welfare services. But the redress scheme proposed for survivors of institutional child sexual abuse is not a universal ‘no-fault liability scheme’ in the same category as the National Disability Insurance Scheme or workers compensation schemes or motor accident compensation schemes. It is an entirely different species of smaller scheme that is not to be entirely funded by government. It will provide single payments of limited financial redress to a finite number of victims of past wrongdoing, as well as some counselling and psychological services. It is envisaged that the scheme will eventually close,²⁵⁷ with the number of potential claimants estimated at 60 000.²⁵⁸ In this context the arguments concerning efficiency, complexity of administration and the high expense of avoiding double compensation are not so persuasive because the scale is much reduced. Any administrative and cost burden of avoidance of double compensation could be borne by the scheme rather than eliminated altogether by requiring survivors of abuse to forego their common law rights. In the event of a common law judgment or settlement, double compensation would be avoided by a refund or set-off arrangement in respect of any prior redress scheme payment and the plaintiff/applicant would cease to be eligible for counselling and psychological services through the redress scheme.