The recent decision in Lonergan v Trustees of The Sisters of Saint Joseph & Anor [2021] concerned allegations of historic sexual abuse of a child by a priest. Significantly, the Supreme Court of Victoria discussed whether an earlier settlement between the parties should act to offset the current assessment of compensation.

The Plaintiff in the case was abused by the Parish Priest, Gregory Coffey, while attending St Joseph’s Primary School in Ouyen, Victoria from 1973 to 1974, for which liability was admitted. It was held that the abuse was caused by a breach of duty by the Catholic Diocese of Ballarat and the Sisters of Saint Joseph, who owed a duty of care towards the students of the school.

As a result, Keogh J assessed compensatory damages at $650,000. This sum was made up of $250,000 for pain and suffering and loss of enjoyment of life, $10,000 for future treatment expenses, and $390,000 for economic loss. Other issues were raised by the Plaintiff but ultimately the Court did not make an award for aggravated or exemplary damages.

However, the Plaintiff had made a prior claim in 2000 against the Defendants for injury, loss and damage cause by the abuse, which settled by confidential agreement for $45,000 inclusive of costs. Consequently, the Court had to consider whether the sum previously received by the Plaintiff in his prior settlement should be taken into account in the current settlement.

The Court concluded that it was neither just nor reasonable to take account of the amount paid under the initial settlement by setting it off against the assessment of damages in these proceedings. This was because the Diocese obtained a real benefit of the Plaintiff maintaining the confidentiality of the first settlement. Further, the sum of the first settlement was modest, and the Plaintiff was disadvantaged by the lapse of time due to the effects of inflation.

The case therefore highlights that previous settlements should not be taken into account in future assessments of damages in historic abuse matters where this would be unjust or unreasonable.