Anthony Grant
In ACC v TN [2023] NZCA 664 20 December 2023, the Court of Appeal held that victims of sexual abuse are entitled to compensation from ACC for loss of earnings from the time they were abused, regardless of when they make a claim for treatment. In this article I will call it the ‘TN’ case.
The ACC has projected that this category of claims will cost it about $3.6 billion and relate to about 100,000 victims.
Richard Prebble, a former MP and ACT Party leader and now a political commentator, says the “avalanche of claims [from the TN case] could break [the ACC]”. Prebble also says, “in other countries perpetrators pay. Victims sue. Not here. Let victims sue their abusers. Compensation should come from perpetrators, not taxpayers.”
What Prebble may not know is that the law in New Zealand is so unhelpful that victims will almost certainly be advised not to sue.
Why? There are two main reasons.
First, the most logical course of action for a child who has been raped repeatedly by her father is to sue him for the torts of battery or assault but that is a problem since these torts have substantially disappeared with the introduction of the ACC regime.
The second avenue for compensation is to sue the father for breach of his fiduciary obligations to care for his child but this cause of action also presents a major problem because the Supreme Court held in the so-called ‘Alphabet’ case (A v D [2025] NZLR 579) that the parental obligation to care for a child ceases in almost all cases when the child becomes an adult. Thereafter the Limitation Act will start ticking.
A child who is sexually abused will typically lack the knowledge, maturity and money to embark on significant litigation, meaning he or she will not sue before the cause of action has expired. It is also likely that the child has been threatened with violence by her father if she were to sue him and be intimidated from doing so.
The result of the TN and Alphabet cases is that parents who have sexually abused their children are likely to avoid all financial claims for the harm they have caused and leave taxpayers to pay billions of dollars in reparations.
This is a ridiculous state of affairs.
Parliament should act
The Supreme Court held in the Alphabet case that it was too hard for the courts to modify the law of fiduciary relations to create an appropriate remedy for a child in these circumstances. In the face of this obstacle, it is appropriate for Parliament to create a discrete remedy for this type of wrongdoing.
One aspect that should be investigated is a modification to the Limitation Act to extend the period for when a victim can sue. Lawyers tend to be too narrowly focused on limitation periods. The development of what I will call “the Waitangi Tribunal initiatives” has, in my opinion, been extremely helpful in remedying the harm caused by the historical Limitation Acts. I suspect most people now acknowledge that Māori suffered many great injustices and that it was entirely appropriate for the limitation periods to be extended to enable them to pursue the claims they have made.
So, too, with victims of sexual violence. Why shouldn’t Parliament do for them what it did with the Waitangi Tribunal regime and create a much longer period for victims to sue than is currently permitted by the Limitation Act?
If the law of fiduciary obligations is regarded by the courts as too complicated to modify appropriately, then Parliament can declare a new discrete remedy that will enable the victims of family violence to bring their claims. If the problem has also arisen by the de facto abolition of the torts involving physical violence, then the torts can be restored in this very limited area of the law.
If victims of family violence can bring their claims many years after the acts of violence were committed, parents will learn that they harm their children at their peril. At present, parents who contemplate sexual violence against a child will probably think there will be no financial repercussions but if it becomes known they can be sued for decades, this may deter them and lead to a reduction in sexual violence against children.
It is an indictment of our legal system that taxpayers should have to pay billions of dollars and put the ACC regime at risk to rectify the harm caused by people who can fairly be called criminals and who are not required to pay anything to their victims. Parents who abuse their children should pay for the consequences of their actions and the law should be changed to make this happen.
And if non-lawyer politicians are reluctant to interfere with such matters of law, let them refer the subject to the Law Commission with a mandate to provide a report within six months on the changes that can be made to achieve an appropriate outcome.
Anthony Grant is an Auckland barrister and trustee, specialising in trusts and estates. He is a member of The Law Association’s Trust Law Committee
Suing is unlikely to benefit victims, either financially or emotionally. Perpetrators may have little by way of assets.They may have lost their jobs and be in prison, or may be elderly and not earning. It is difficult enough for the victims of child abuse to disclose their harms, suing may re-traumatise them.
Better to legislate to allow ACC to recoup the money by being able to sue the perpetrator if they have sufficient assets to make it worthwhile.