Institutional Responses to Child Sexual Abuse - Consultation Paper

After hearing the stories of thousands of victims of child sexual abuse, the NSW Government Consultation paper on the civil litigation recommendations of the Royal Commission into Institutional Responses to Child Sexual Abuse has now been released.

If you are an insurer or your business has any exposure to children, the proposed reforms are likely to impact your legal liability and insurance premiums.

  • Compulsory "sexual abuse" insurance coverage to cover future claims involving child sexual abuse.

    Insurance policies commonly exclude claims alleging sexual abuse and molestation. If cover is provided, it is often limited to coverage for defence costs only. There is also the public policy issue to consider - should insurance be available to cover criminal activity?
     
  • A non-delegable duty of care that imposes strict liability for claims of child sexual abuse.  

    Unlike the duty of care that is owed by employers to employees, the proposal would mean that even if an organisation demonstrated that it had taken reasonable steps to prevent the abuse from occurring, the organisation would still be legally liable for all instances of child sexual abuse against children in its care (including in circumstances where the institution was unaware of the abuse perpetrated).

    An act, including a criminal act, by any person to whom an institution delegates authority would be caught by these reforms – including officers, employees, office holders, agents, independent contractors and volunteers.

    This would be a dramatic shift in the law of negligence, essentially combining what is generally accepted as being 2 distinct principles: non-delegable duty of care and strict liability, which may require legislative amendment. This, combined with potential issues with securing insurance, could open the door for further discussion around the formulation of a scheme to cover these liabilities into which every organisation dealing with children contributes, rather than leaving them to their own devices to secure cover.

    The Royal Commission acknowledged in its Report on Redress and Civil Litigation that it was not appropriate for the proposed changes to the duty of institutions to apply to not-for-profit or volunteer organisations generally. This carve out has been reflected in the Consultation Paper.
     
  • A reversal of the onus of proof in instances of child sexual abuse.
     
  • Reforms so that an institution's trust assets might be available to satisfy a claim of child sexual abuse. This could potentially make trust assets which have been set up for a specific charitable purpose available to satisfy damages in child sexual abuse claims.

The government has asked for responses to its consultation paper by Monday 4 September 2017.

KEY IMPLICATIONS FOR YOUR BUSINESS
  1. The insurance industry will need to consider when it might be prepared to provide cover and what conditions it will impose. For instance, the Royal Commission suggested in its Report that an insurer might provide cover for a strict liability offence if the insured takes all reasonable steps to prevent abuse.
  2. If you are an organisation that has any contact with children, carefully review your current policies and systems to ensure that adequate steps are being taken to protect children in your care.
  3. Insurance coverage will not be automatic, and to the extent it is available, it is likely to require organisations to take reasonable steps to prevent abuse. Your organisation will need to ensure that it can demonstrate and document its child protection systems and processes.
  4. If you are an organisation that relies on trust assets, be aware that if these reforms are acted upon, your assets may not be protected from abuse claims.
Louise Cantrill

I provide solutions that matter to client success through collaboration, innovation and excellence.

Louise Cantrill Partner

Louise has specialised in liability litigation and insurance advice since 1996, combining technical excellence with a commercial approach to deliver client focused outcomes. She is highly regarded by her insurer and insured clients (including government agencies, corporates and self-insureds) across a wide range of claims litigation and technical insurance advice.

Louise is highly regarded for both her insurance advisory work with insurer, government and corporate clients, and her claims expertise in the areas of professional negligence (including medical, financial services and construction) and directors & officers.

Louise manages civil matters and appears at Coronials across a wide range of professional negligence and directors and officers claims, including catastrophic injury, multi-party, complex commercial, and high profile claims.

Louise's advisory practice focuses on policy interpretation and multi-contract transactional advice. She advises on policy interpretation and coverage, including multilayer programmes and re-insurance issues. Her insurer clients seek her out for policy wording reviews.

Louise's clients include NSW Ministry of Health, Transport for NSW, W.R. Berkley Insurance Australia, Allied World Assurance Company, Macquarie Bank, Insurance Council of Australia, Sydney Water Corporation, Westfield, PPB Advisory and McGrathNicol.

One of her career highlights was advising Transport for NSW on insurance issues arising from the 'fixing the trains' project, which was one of the most significant  corporate and operational restructures in Australia. This included transactional advice and drafting as well as policy analysis and negotiation.

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Maria Panos

The best outcome is only a starting point. How we get there is essential to success.

Maria Panos Senior Associate

Maria is a specialist in large scale commercial disputes and government inquiries. She has extensive experience acting for state and commonwealth government departments and has been involved in a wide range of matters for commercial clients including liquidators, banks and resources clients.

Maria has recently acted in a number of high profile inquiries. She acted for the NSW Police Force in the Inquest into the deaths arising from the Lindt Café Siege. In 2013 she acted for the State of NSW at the Royal Commission into Institutional Responses to Child Sexual Abuse in respect of its Case Study on the Bethcar Children's Home. She has also acted for the NSW Police Force in a wide range of matters including the Cunneen Special Commission of Inquiry into matters relating to the police investigation of certain child sexual abuse allegations in the Catholic Diocese of Maitland Newcastle, appeared for the Commissioner of Police in the Police Integrity Commission in Operation Protea and has acted for the State of NSW in a number of claims by both former police officers alleging negligence against the NSW Police Force and individuals who allege that they have been unlawfully arrested, maliciously prosecuted or defamed in their dealings with the NSW Police Force.

Maria has also had commercial experience and was involved in representing the liquidators of Lehman Brothers Australia in an investors' class action commenced against the company.

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Kerry Stewart

I am passionate about excellence, collaboration, innovation and developing trusted relationships.

Kerry Stewart Special Counsel

Kerry is an expert in insurance and commercial litigation. Her expertise covers advising and conducting complex litigation in relation to claims arising from a range of policies and conducting litigation on behalf of State Government agencies. Kerry is also an expert in representing Government agencies both in litigated matters, Coronial inquests and statutory inquiries.

Kerry has almost 20 years' experience in advising a wide range of clients including the Government sector, both State and Federal and the insurance industry.

Kerry's breadth of expertise covers:

  • defending Government agencies from claims in negligence
  • defending Government agencies from claims arising from intentional torts
  • defending professional indemnity claims including medical negligence
  • acting in complex insurance litigation
  • advising Government agencies and appearing at Coronial inquests and statutory inquiries.

Kerry's Government sector clients include New South Wales Health, New South Wales Police and the Department of Defence. Her reputation as a highly skilled litigation lawyer ensures Kerry not only advises and acts on behalf of her clients in litigated matters but is sought out in order to act in relation to matters which have the potential for public scrutiny, media attention and in which tensions often exist between the government agency, the Minister, relevant stakeholders and the public interest.

Kerry has considerable experience in conducting large, complex and multi-party litigation as well as providing advice on policy interpretation and coverage. She has defended large claims involving professional indemnity policies, public liability policies and contract works policies issued pursuant to construction contracts. As an experienced litigator, Kerry has an excellent knowledge of practice, procedure and evidence and has extensive experience in qualifying experts in a wide range of fields.

Kerry is an experienced litigator with excellent technical skills. She is an experienced negotiator and frequently employs various forms of alternate dispute resolution when needed and when it best serves her clients' interests. She has resolved a large number of cases using mediation.

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