Federal Court Challenge Filed Over Northern Territory Compensation Caps

A Federal Court challenge was filed Thursday against laws that cap compensation for unlawful actions by prison staff. The action targets legislation passed in 2021 that sets maximum payouts for assaults, batteries, strip searches, and wrongful imprisonment.

The challenge argues the caps do not apply when conduct amounts to child abuse and that the limits are invalid under the Race Discrimination Act 1975 because they disproportionately affect Indigenous people. It also seeks to restore the court's power to award additional damages for intentional wrongs.

The laws were introduced after a $35 million settlement with former youth detainees who alleged assault and false imprisonment. Before the changes, compensation amounts were determined by courts without statutory caps. Under the current rules, damages are limited to roughly $3,000 for unlawful assault, $6,250 for battery or unlawful strip search, and about $312 per day for wrongful imprisonment after 60 days.

The maximum total payout is capped at approximately $18,000.

The case involves a detainee who was 16 at the time of the alleged incidents. The filing states he was assaulted twice, subjected to 11 batteries, and unlawfully separated by youth justice officers. A representative for the agency bringing the case said the government does not publish data on out-of-court settlements and often requires non-disclosure agreements, making it difficult to assess how many people have been affected.

The challenge also references a recent High Court decision that awarded $50,000 in exemplary damages to each of four men illegally tear-gassed at a youth detention center 12 years ago. Under the 2021 laws, such additional damages would no longer be available.