Court of Appeal allows appeal to reduce record damages awarded in historic abuse case

Case Note: Bishop of Wagga Wagga v TJ (a pseudonym) [2024] VSCA 262 (8 November 2024)

Summary of the decision

On 8 November 2024 the Victorian Court of Appeal¹ substantially upheld the Bishop's appeal, with a reduction in the record $3.3 million awarded by a jury to a sexual abuse victim, by more than $1 million.

TJ was abused by convicted paedophile priest Vincent Kiss in the 1960s and 1970s. The abuse began when TJ was aged 14 years and continued for approximately two and a half years. The Bishop argued that the damages awarded by the jury were manifestly excessive and against the weight of the evidence, namely that TJ had enjoyed a relatively successful life.

Key takeaways

The Court of Appeal:

• reduced pain and suffering damages from $1.1 million to $550,000;
• reduced interest payments from $462,000 to $231,000;
• set aside the $1.3 million awarded for exemplary damages; and
• maintained the $965,000 awarded for economic costs.

A recap of the Supreme Court jury decision

TJ claimed he sustained complex post-traumatic stress disorder and depression as a result of the abuse perpetrated by Kiss and sought compensation in the form of general and special damages. He later amended his claim to also include specific claims for aggravated damages and exemplary damages.

Following the abuse, TJ worked as a teacher in the Catholic school system and started seeing counsellors during the 1990s. TJ progressed to working as a Religious Education Coordinator, and later worked in and set up a tuition centre in the UK. TJ argued that had it not been for the abuse, he would have progressed to the role of School Principal.

TJ reported the abuse to police in 1994. In 2002, Kiss was convicted following a guilty plea in relation to offences against TJ and several other boys.

The Bishop filed an amended defence four days prior to trial, admitting TJ had been sexually abused by Kiss. The Bishop also admitted the existence of a complaint received in 1968 by another victim also abused by Kiss. These later admissions formed the basis of TJ's claim at trial for aggravated and exemplary damages.

In November 2023, a Victorian Supreme Court jury awarded TJ $3.3 million in compensation comprising:

• $1.1 million for pain and suffering damages;
• $965,000 for damages for economic loss (comprising $896,000 for past economic loss and $69,000 for future economic loss);
• $1.3 million for exemplary damages; and
• $462,000 in interest payments.

At the time, it was the largest award of its kind to a sexual abuse victim.

The appeal decision

In seeking leave, the Bishop argued the following primary proposed grounds of appeal:

• The trial judge erred in permitting the issue of exemplary damages to be determined by the jury and further erred in not setting aside the jury’s verdict in respect of exemplary damages. In the alternative, the jury's verdict for exemplary damages was manifestly excessive and contrary to the evidence and weight of the evidence.
• The jury's verdict on pain and suffering damages was manifestly excessive and contrary to the evidence and the weight of the evidence.
• The jury's verdict on economic loss damages was also manifestly excessive, and contrary to the evidence and the weight of the evidence. In the alternative, the jury's verdict for economic loss damages was not reasonably open on the evidence.

The Court of Appeal allowed the Bishop's appeal in relation to the assessment of pain and suffering damages and exemplary damages. However, the Court of Appeal refused the Bishop's appeal in relation to the jury's assessment of economic loss.

Pain and suffering damages

The Court of Appeal held that the amount awarded by the jury for pain and suffering damages was significantly beyond an amount which was reasonably open to the jury.

The Court of Appeal noted that the abuse to which TJ was subjected, "while extremely serious, did not involve violence or acts of sexual penetration". The Court of Appeal also noted that "with the assistance of psychological treatment, [TJ] has subsequently managed to experience a relatively successful life, albeit one that has not been without challenges. He is married to a loving wife and together they have raised three happy, successful and independent children. He has participated in full employment of a rewarding kind for decades".

In assessing an appropriate award for pain and suffering, the Court of Appeal considered that TJ's entitlement ranged in the sum of $500,000 to $600,000 and considered the appropriate figure for pain and suffering damages was $550,000. In doing so the Court of Appeal noted that such a reduction was required to bring the amount of pain and suffering damages awarded in line with the awards made by Judges.

Economic loss damages

The Court of Appeal found that it was open to the jury to accept TJ's submission regarding his work history and aspirations and that there was a sound evidentiary basis upon which to propound a viable counterfactual work scenario absent the abuse by Kiss. The Court refused the Bishop's appeal and held that there was no basis for setting aside the jury’s verdict on economic loss.

Of note is the fact the economic loss damages awarded by the jury in the initial trial ($965,0000) was more than was sought by TJ's Counsel, who submitted at the trial that the jury should award a sum of not less for $834,003 for economic loss. Despite this, the Court of Appeal still upheld the jury's award in full.

Exemplary damages

The Court of Appeal reasoned that an award for exemplary damages required evidence the Bishop had engaged in conduct showing a conscious and contumelious disregard of the plaintiff’s rights or that which was high-handed or insolent or vindictive or malicious.

It was noted that the award for exemplary damages was made on the basis of the Bishop's admission of a prior compliant received in 1968 by another victim also abused by Kiss; and the Bishop's initial non-admission of the abuse perpetrated by Kiss on TJ. The Court of Appeal stated the paucity and total lack of detail of evidence relating to the 1968 complaint precluded any award of exemplary damages. As to the initial non-admission of the abuse, the Court of Appeal looked at the entirety of the pleadings across three defences and was satisfied the Bishop had attempted to make more appropriate admissions as the case progressed and was not lacking in bona fides or otherwise acting improperly or unjustifiably.

The Court articulated useful guidance, namely that exemplary damages:

• are an exceptional remedy and rarely awarded;
• have a primary purpose to punish and deter and must "not merely irritate, they must sting";
• should only be awarded if the compensation awarded is insufficient to punish a defendant for their unacceptable conduct and to mark the court's disapproval and act as a deterrence.

Accordingly, the Court of Appeal allowed the Bishop's appeal and set aside the jury's award for exemplary damages entirely.

¹ Comprising Beach JA, Orr JA and J Forrest AJA.