Northern Territory Youth class action settlement approved

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The $35 million AUD settlement was approved with no objections from group members, with a reserve set aside for financial counselling services for the class members, as well as the inclusion of an apology from the Northern Territory Chief Minister.

Dylan Jenkings and Aaron Hyde brought proceedings against the Northern Territory for assault, battery and false imprisonment of children held in youth detention centres between 1 August 2006 and 27 November 2017. The applicants alleged that officers used force, handcuffing, strip-searching and isolation in excess of the powers set out in the Youth Justice Act (NT).

The parties agreed to an in-principle settlement of $35 million, inclusive of costs. An important aspect of the settlement for class members was the inclusion in the settlement notice of an apology made by the Northern Territory Chief Minister Michael Gunner after the Royal Commission into the Protection and Detention of Children in the Northern Territory.

The parties sought approval of the settlement, without admission of liability, including:

a) legal costs of $10 million to be paid to Maurice Blackburn;

b) Maurice Blackburn’s appointment as claims administrator;

c) an additional payment of $10,000 for each applicant; and

d) $200,000 to be reserved for payment to financial counselling and/or financial capability training services (Financial Capability Reserve).

The latter provision was included to provide support to class members, recognising that most class members are Aboriginal or Torres Strait Islanders with many from remote communities, and the prevalence in the cohort of literacy and numeracy issues, English language difficulty, lack of familiarity and access to financial institutions, likelihood of financial abuse, incarceration, and other social and cultural challenges.

Due to various practical and social and cultural factors, at the time of the settlement approval hearing on 8 November 2021, less than 50% of class members had registered. Consequently, the parties sought to extend the registration deadline from 16 November 2021 to mid-2022.

On 15 December 2021, Mortimer J approved the settlement in substantially the terms requested – but with $600,000 for the Financial Capability Reserve (reducing approved legal costs to $9.4 million). The registration deadline was extended to 31 July 2022.

In addition to the factors set out more fully below, her Honour had regard to the following in approving the settlement:

(a) the trial was listed for 8 weeks;

(b) there were 107 lay and 3 expert witnesses;

(c) a ‘view’ was likely to be required;

(d) some of the witnesses would require interpreters and other supports;

(e) there were a number of legal complexities including conflicting legal authorities;

(f) the prospects of appeals on both sides;

(g) giving evidence by class members was likely to be challenging as they would have had to relive traumatic memories;

(h) the settlement sum is fair and reasonable, considering damages awarded in similar matters; and

(i) the inclusion of the apology in the settlement notice.

Statements from Class Members

The live-streamed settlement approval hearing featured oral statements from five class members. A further 17 written statements were received from class members – all in support of the settlement.

Her Honour said that the “Court attache[d] significant weight” to the statements of class members in support of the settlement, citing the observations made by Maurice Blackburn that class members had been “universally supportive” of the settlement in their contact with class members (at [27]).

Her Honour described the statements as expressing their support of “the settlement in the context of a narrative about their individual experiences while in youth detention”. Her Honour made no findings of fact on these statements but said they were admitted for the purpose of understanding “why group members felt supportive of the settlement” (at [30]-[31]).

Financial Capability Reserve

Her Honour indicated that the availability of financial counselling services was an essential component of the settlement being approved as fair and reasonable (at [50], [78]). Her Honour observed the “sadly notorious disadvantages which continue, disproportionately to face many First Nations communities: poverty, compromised health, disproportionate interactions with the criminal justice system” to name a few, and said the class members “can make their own choices about what to do with the money. . . the critical step is that they make informed choices, having had assistance and advice in making what could be a very important financial decision for them” (at [52]-[53]). For this reason, and the uncertainty of funding and heavy workload for financial counselling and capability organisations, her Honour reserved $600,000 (instead of the proposed $200,000), deducted from the solicitors’ costs. Any surplus will be distributed to class members.

Settlement Scheme

The proposed settlement scheme attributes a daily rate to time spent in youth detention per security classification (low, medium, high) with a separate daily rate for time spent in isolation. There will also be a minimum payment amount and the class members can request a review. The applicants proposed that the compensation be paid in tranches, so that those who registered by the original deadline would not have their payments delayed by the extension. Moreover, 10% of the settlement sum would be reserved to allow for amendments to compensation amounts based on reviews, and any remainder would be distributed on a pro rata basis at the end of the period.

Her Honour considered that this was fair and reasonable particularly in the context of a settlement with no admission of liability, and noted that assessing individual damages would have been extremely complex.

Costs

Maurice Blackburn sought $10 million in costs for the settlement and the administration to be deducted from the settlement sum. The Court-appointed independent costs assessor, Elizabeth Harris reported that the total costs would substantially exceed $10 million. Her Honour accepted Ms Harris’ report, including her observation that the capping of costs passed the risk to Maurice Blackburn and provided additional certainty to class members. Her Honour approved costs of $9.4 million, with the Financial Capability Reserve deducted from the proposed $10 million.

Claims Administrator

Maurice Blackburn was appointed as claims administrator on the basis of its familiarity with class members, and knowledge of the many challenges facing class members in participating in the settlement.

Conclusion

Her Honour noted the “meaningful” amount of compensation available and pertinently concluded: “the settlement may “lay to rest” the allegations in the proceeding… However all group members will carry their experiences of youth detention with them for the rest of their lives. No amount of money can change that” (at [121]-[122]).

Jenkings v Northern Territory of Australia (No 5) [2021] FCA 1585

Federal Court of Australia
Mortimer J, 15 December 2021

Applicants’ Solicitors: Maurice Blackburn;
Respondent’s Solicitors: Solicitor for the Northern Territory;
Applicants’ Funder: N/A

Austlii Link: Available here

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