The Government of Newfoundland and Labrador has agreed to pay $45.8 million to individuals abused at Catholic-run institutions across the province, including the notorious Mount Cashel Orphanage, parishes and government-funded schools.

Lawyers representing hundreds of claimant survivors and counsel for the province’s justice and safety department presented this tentative settlement to Supreme Court of Newfoundland and Labrador Justice Garnett Handrigan during an April 24 court hearing.

Handrigan will approve or deny the proposed compensation agreement at a later date.

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St. John’s Archbishop Peter Hundt confirmed in an email “the $45.8 million that the provincial government has agreed to pay is part of the $121-million compensation awarded by the Court to the victims of Church-linked abuse.”

Hundt also stated that “like the Justice Minister (Helen Conway Ottenheimer), we hope this government funding will help bring a measure of closure and healing to the victims of Church-linked abuse.”

It was over six weeks ago, on March 12, that Bob Buckingham, the counsel for 91 of the plaintiffs, shared that a substantial third-party liability agreement had been reached with an unnamed party. It was surmised he was alluding to the provincial government based on statements made in previous court hearings.

Buckingham told reporters at the time that this development “is the second-best thing to happen in this case” that has been ongoing for 27 years. The best moment for the claimants and their counsel, said Buckingham, was the Supreme Court of Canada decision on Jan. 14, 2021, that upheld the Archdiocese of St. John’s vicarious liability for the abuse inflicted at the Mount Cashel Orphanage during the 1940s, ’50s and ’60s. The operators of the infamous establishment, the Christian Brothers of Ireland, filed for Chapter 11 bankruptcy in the United States back in 2011.

This legal victory set off a chain of events culminating in an April 2025 independent claims judgment that $121 million is owed to more than 350 claimants, including survivors of abuse by archdiocesan clergy. The Roman Catholic Episcopal Corporation of St. John’s (RCESJ) entered bankruptcy protection in December 2021 and has since liquidated churches, schools, land and more to meet its court-ordered obligations.

To date, nearly $50 million has been accumulated through this process, and $37 million of that amount has been distributed to survivors or their estates.

According to the 24th report filed Jan. 15 by the court-appointed monitor, Ernst & Young, the RCESJ and its counsel completed 124 property transactions. There are 14 assets yet to be sold with a combined valuation of $2.15 million. It is clear the episcopal corporation will not be able to raise the money needed to satisfy the $121-million judgment.  

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An approval from Handrigan would reduce the shortfall from the independent-adjudication-ordered $121 million to approximately $40 million.

The RCECSJ sought a ruling from the Court of Appeal of Newfoundland and Labrador that would have ordered its former insurance company to cover some of the settlement. But in an April 16 decision, the appeals court upheld the trial judge’s ruling that Guardian Insurance can void the policy due to the archdiocese’s failure to disclose sexual abuse claims when it purchased the policy in 1980 and renewed it for four subsequent years.

It was in July 2024 that Geoff Budden, the counsel for over 200 plaintiffs, first told The Catholic Register that the provincial government bears some responsibility.

“It also has to be kept in mind that most of the survivors of this abuse were, to one degree or another, in the care of the province of Newfoundland at the time they were abused,” said Budden. “They were either at Mount Cashel or they were in schools. Either way, they were in the care of the state, either directly or indirectly. We will be looking at the Government of Newfoundland and Labrador to likewise (realize) they have a role in resolving this.”

On April 20, four days before the court appearance, Budden filed an application outlining the terms of the $45.8-million deal.  

Clifton Prophet, a partner with the firm Gowling WLG representing survivors, shared in his presentation to Handrigan that “the entirety of this settlement agreement has been vigorously negotiated over a 15-month period with the government.”

Prophet explained that 297 members of the claim group will qualify for this payout if approved. The subdivision of individuals victimized by priests and the plaintiffs who previously received money from the government in 1996 were deemed ineligible.

All the lawyers appearing in court advocated to Handrigan that he has the residual discretion to approve the settlement agreement under Section 11 of the 1985 Companies’ Creditors Arrangement Act (CCAA), as it permits the Court to “make any order that it considers appropriate in the circumstances.”

Regarding the substantial benefit of a quick approval of this agreement, the written application stated to the court that “many of the abuse claimants are seniors. Many are in failing health. Many have died waiting for justice.”

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James Foran of Deloitte, the court-appointed financial advisor to the claimants’ counsel, said “the settlement agreement avoids a future of potentially complex, time-consuming and costly litigation, with no certainty of outcome, and which might otherwise take years to resolve.” 

As for the $40-million gap that remains, Budden has alluded to “the larger Catholic world” in previous conversations with the Register as a party “we hope will make substantial contributions to reflect their potential liabilities.”