Christian Brothers Granted Moratorium on Abuse Claims Amid Financial Concerns

The Christian Brothers religious order has been granted a moratorium on all civil claims against it, after arguing it was running out of money to pay victims of child sexual abuse.

The moratorium was granted by Judge Scott Nixon in the NSW Supreme Court on Thursday morning, after lawyers for the Christian Brothers brought an application for the moratorium last week.

In arguing for the moratorium, lawyers for the Christian Brothers told the court the religious order had $23 million in cash and was losing about $1.7 million a week since October to victim payouts.

The moratorium means all current cases against the Christian Brothers will be paused until a hearing is held to determine how the religious order's creditors scheme will operate.

That includes all claims which have been settled but are yet to be paid out.

The court heard last week there were 32 matters of alleged abuse by Christian Brothers listed for trial in the next three months alone, and there were 540 applications in process with the National Redress Scheme for abuse survivors.

The court on Thursday heard the Christian Brothers' creditors scheme intended to distribute funds "equitably" to all creditors, which included any person with an abuse claim against the order.

Lawyers for the religious order told Thursday's hearing a moratorium would "preserve" the opportunity for victims of abuse to seek compensation under the proposed creditor's scheme, which might otherwise be lost without a stay on all current proceedings.

'That opportunity may be lost'

Lawyers for victims told the court they needed time to give appropriate advice to the "cohort of vulnerable victim-survivors".

In granting the moratorium, Justice Nixon said he accepted arguments that the Christian Brothers order risked running out of money to pay victims if a moratorium was not granted.

"I'm satisfied that the moratorium order should be granted in order to preserve the opportunity for the scheme to be considered by claimants, given that opportunity may be lost," he told the court.

Outside court, Christian Brothers solicitor Daniel Maloney would not comment on the hearing or concerns raised about the transfer of assets to Edmund Rice Education Australia (EREA).

EREA was set up in 2007 to take over schools and educational institutions previously run by the Christian Brothers.

A hearing will now be held to determine how the Christian Brothers creditors scheme will operate and how its funds will be distributed.

That hearing is set down for two days from September 21.