The Christian Brothers raped and sexually assaulted children on such an immense scale of depravity that they have run out of money to pay for the damage.

The real gold has been squirrelled out of the hands of claimants and potential claimants, in exchange for a few peppercorns.

About $2 billion (at cost value) of school properties and land have been moved into trusts associated with Edmund Rice Education Australia. The market value is now in the order of $3.5 billion.

The scheme was originally hatched well before the Royal Commission into Institutional Responses to Child Sexual Abuse got underway.

This was the latest wheeze orchestrated by various organs of the Catholic Church to leave victims high and dry.

There was the Ellis defence (no point suing the Christian Brothers trustees as they are not liable for the crimes of the Brothers).

That was largely undone by legislation in 2018 – e.g. in Victoria the Legal Identity of Defendants (Organisational Child Abuse) Act.

More recently, we had the Bishop Bird defence – the church is not vicariously liable because it doesn’t “employ” the predatory priests or Brothers, despite housing, clothing and feeding them … and as Justice Jacqueline Gleeson explained: raping children is not part of the priestly job description, so there can be no vicarious liability.

That too has subsequently been wound back legislatively in a number of states.

Now, it’s the No Money defence – with the Brothers claiming they are skint and at best can scratch up a few piddling cents in the dollar under a potential court-approved creditors scheme.

The Brothers have no coverage with Catholic Church Insurance and its self-insurance has run out.

However, plans are not proceeding entirely smoothly.

On Monday, June 22, the law firms representing the plaintiffs seeking compensation were given three hours’ notice for an urgent meeting. The notice was issued by Gilbert + Tobin, the Brothers’ insolvency representatives.

A lawyer from G+T read out a prepared statement announcing that within 24 hours the Brothers would apply to the NSW Supreme Court for a moratorium on all current and future claims. The meeting was then promptly ended.

As victim lawyer Dr Judy Courtin told the ABC, we were “blindsided”.

If the Brothers get their way, a court-appointed creditors scheme with limited funds would leave their school properties and other assets intact, while the victims of the schools’ predatory staff would be left with crumbs.

In less than 24 hours, the overworked lawyers for the damaged plaintiffs rallied a team of silks in property law, insolvency law, and institutional abuse law – including Andrew Harding SC and Tim Hammond SC.

They requested an adjournment – and got a week.

The adjourned hearing was held on Thursday (July 2) before Justice Scott Nixon. He ordered a moratorium on litigation against the Brothers, but “carved out” all current and future sexual abuse cases.

Further, he ordered the Christian Brothers to replace the church trustees as the defendant, with arrangements for the appointment of a “proper defendant”.

Dr Courtin told Justinian that it is “a great win for survivors, to date”.

“But we still have another bigger battle to win – that against Edmund Rice Education Australia. We are not giving in to these bullies.”

Presumably, it could sell some of the school assets to meet the claims arising from offending Brothers who taught at those schools. Even stand-alone homes owned by the Rice Trust could go on the market, along with the conference centres, retreats and lucrative investments.

The most likely scenario is that they would not need to sell any schools, merely hold back for a few years on major upgrades and building programs worth up to a couple of hundred million dollars. After all, these institutions are still on the taxpayers’ teat, and it’s not as though the wider Catholic Church could be unable to stump up funds to help the broke Brothers.

The Royal Commission was told that 22% of the Christian Brothers between 1950 and 2010 had been accused of child sexual abuse.

The court was told that the religious order has $23 million in the bank and was shelling out $1.7 million a week to its victims.

For the 35 years between 1980 and 2015, the order paid its sexual abuse survivors $13.7 a year, or about $480 million in total.

There are about 32 cases of alleged abuse by the CB listed for trial in the next three months. All up, there are more than 330 claimants including “prospective claimants” affected by the current scheme.

There are another 540 applications for capped payments with the National Redress Scheme.

An excellent report in the Financial Review from Myriam Robin explains that quite soon the Brothers themselves will cease to exist. There are only 175 left, with an average age of 81, and no new recruits on the horizon.

They are living in the community fully supported by the Christian Brothers, with $15.6 million set aside to care for them – including nine with convictions and others facing child sex allegations.

It’s back again for another hearing in late September.