Kieran Tapsell. Pell’s business strategy in tatters.

Mar 29, 2014

There was once a rich man in England who became tired of watching his friends’ estates being eaten up by lawyers’ fees in disputes over wills. So, he made a very simple will leaving everything to a friend, and then wrote a letter to the friend explaining what he wanted the friend to do with his estate, thinking that this was the best way to keep lawyers’ snouts out of it. That will and the letter ended up becoming a lawyer’s veritable pig feast because it became the classic case in the House of Lords on secret trusts. I could not help being reminded of that while watching George Pell in the witness box at the Royal Commission, trying to explain his reasons for “vigorously” fighting John Ellis’s claim for compensation arising out of his sexual abuse by the Sydney priest, Aidan Duggan.

In 2002, Richard Carleton interviewed Pell on Sixty Minutes about his Melbourne Response. Pell admitted that the victims had to swear to observe secrecy in return for the limited compensation that the scheme offered. He said that if the victims did not want to sign this, they could “go to the courts.” Two years later, in the Ellis case, Pell demonstrated what would happen to them if they tried. Pell and the Trustees of the Archdiocese spent $756,000 paying lawyers to fight a case that Ellis initially was prepared to settle for $100,000, and then for $750,000 at the time the application for leave to extend the limitation period.

Pell and his lawyers revealed all the classic symptoms of someone wanting to run a test case to prove a point, and to indicate to potential claimants that their claims were on shaky legal ground. They succeeded: the New South Wales Court of Appeal found that the Catholic Church does not exist in law, Pell was not liable for the negligence of his predecessors as Archbishop of Sydney, and the Trustees of the Archdiocese were not liable for the sexual abuse of a priest because they had nothing to do with the appointment and supervision of priests. The High Court refused leave to appeal.

Anyone wanting to run a test case will never try to settle it. If the other side makes an offer of settlement, it is rejected, and no counter offer is made. If a counter offer were made, the other side might accept it, and that would be the end of the test case. This is precisely the strategy that Pell and his lawyers adopted with Ellis.

Pell conceded at the Victorian Parliamentary Inquiry that most priests are “not well off”, and therefore a sex abusing priest is unlikely to be able to meet a judgment. The so called “Ellis defence”, where used by the Church, saved it hundreds of millions of dollars, as is shown by a comparison between the average amounts paid out by the Toowoomba diocese, where former Bishop Morris refused to have anything to do with it, and the average payouts by the Melbourne Response and Towards Healing.

In the witness box, Pell was caught between trying to justify his test case, and denying that he was trying to protect the Church’s coffers.  Pell accepted that his instructions to his solicitors, Corrs, were to “vigorously defend the claim” and that part of that was an attempt “to encourage people not to go into litigation.” If they could not go into litigation, their only other recourse was to go cap in hand to the Church for compensation through the Melbourne Response with its official ceiling of $50,000 and Towards Healing with its unofficial ceiling of the same amount. In other words, despite what Pell said to Richard Carleton in 2002, he wanted to make sure that victims of child sexual abuse knew that they really did not have the alternative of going to the courts. As the Chair of the Royal Commission, Justice McLellan pointed out, in those circumstances, the Church, and not the courts, had complete control over the amount it would pay. Justice McLellan has already dropped a gentle hint that all the settlements achieved through Towards Healing and the Melbourne Response may need to be re-opened.

Like the man who wanted to avoid enriching lawyers by writing a letter to the beneficiary of his will, the Church will not only be paying out significantly more in compensation than it otherwise might have, but it will be enriching lawyers as well. The Church won this battle in the High Court, but it has lost the war.

Perhaps the Church should have listened to something a wise man once said that might be paraphrased: what does it profit a Church if it gains the whole world, and suffers the loss of its soul. And the loss of the Church’s soul could not have been more starkly demonstrated than by the evidence given to the Royal Commission about the treatment of John Ellis.



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