Indigenous Legal Group Launches Court Challenge to NT’s Custody Compensation Cap

An Indigenous legal service in the Northern Territory is seeking to overturn a cap that limits compensation for people harmed in custody to less than $19,000.

The Federal Court of Australia building is seen in Canberra, Australia, on Oct. 16, 2025. Hilary Wardaugh/AFP via Getty Images

A Northern Territory (NT) Indigenous legal group has filed proceedings in the Federal Court of Australia over the alleged mistreatment of an Indigenous youth in 2022, seeking to overturn the territory government’s compensation cap for people harmed in custody.

The boy at the centre of the legal case was 16 years old when he was detained in the Alice Springs Youth Detention Centre, with the North Australian Aboriginal Justice Agency (NAAJA) claiming he was subjected to two assaults and 11 batteries, as well as being unlawfully separated by youth justice officers.

If successful, the case would see the limit lifted on the amount of compensation available to the youth, which would then need to be determined.

In 2021, the then-Labor Northern Territory government paid $35 million (US$24.2 million) to settle a class action brought by hundreds of youth detainees who alleged they had been mistreated in detention.

In 2022, the laws were amended to introduce a cap on damages in certain civil wrongs claims brought by people in custody, limiting potential compensation to less than $19,000 in many cases.

“These laws were a knee-jerk response to the Don Dale Youth Justice Class Action which settled in 2021,” NAAJA civil managing lawyer Andrew Roberts said in a statement.

“This case is about government accountability. If it was an individual who broke the law they would have to pay. But rather than taking responsibility for its failings and addressing the problems in youth detention, the NT government chose instead to weaken a crucial accountability mechanism and reduce the compensation that they must pay prisoners harmed in their care.”

The case against the government will claim caps do not apply to compensation in the boy’s case because the alleged acts were a form of child abuse, and will further claim they are invalid under the Race Discrimination Act.

It follows a recent High Court judgement where $50,000 in exemplary damages was awarded to four men who successfully argued they had been illegally tear-gassed in the Don Dale Youth Detention Centre 12 years ago.

“If that same conduct occurred today, the current laws would prevent the court from awarding those young men any aggravated or exemplary damages, despite the High Court describing the Northern Territory’s conduct as reprehensible,” Roberts said.

The lawsuit comes amid increased federal government support to improve outcomes for Indigenous people.

The most recent federal budget includes $1.2 billion over five years from 2025–26 for Indigenous initiatives. Of that funding, $299 million has been allocated to economic and job development, while $27.4 million will support cost-of-living measures and $48.3 million has been earmarked for housing initiatives.

The Epoch Times has contacted the Northern Territory Department of Justice for comment.