A rule which prevents some victims of sex offences from recovering compensation amounts to discrimination and a breach of human rights laws, senior judges have been told.
The Court of Appeal in London is hearing the case of a woman who suffered serious sexual abuse at the hands of her stepfather.
The woman, identified only as JT for legal reasons, is challenging the so-called "same-roof rule", which denies her the right to damages because she lived in the same home as her attacker before 1979.
Lawyers representing JT told three senior judges on Thursday that the rule discriminates against her because of her age and her status as the victim of her stepfather's crimes.
Fenella Morris QC said: "As a minor living in the home of her abusive stepfather pre-1979, the appellant's status as a victim of violent crime who shared a roof with her assailant was one she did not choose and could not properly be expected to change.
"During the period in question - that is, the period of her childhood abuse prior to 1979 - this status must be considered to be immutable.
"It concerns what she was: a child, sharing a home with her abuser, rather than what she did or what was done to her."
JT's stepfather, who abused her when she was aged between four and 17, was convicted of eight offences including rape and sexual assault in 2012 and jailed for 14 years.
But when the woman applied to the Criminal Injuries Compensation Authority (CICA), which pays damages to victims of violent crime, she was refused a payout.
The rule was originally brought in to ensure that abusers did not benefit from compensation paid to victims they lived with.
It was varied in 1979 so that any future child victims of domestic crimes could claim compensation, but the change was not applied retrospectively.
Reforms were made in 2012, but the same-roof rule was maintained amid fears that scrapping it could see an increase in the number of claims.
Ms Morris told the court that JT has suffered "life-changing injuries" for which she has been prevented from recovering compensation in order to shield the CICA from an increase in additional claims, "which may never materialise".
She said: "The message conveyed by the retention of (the same-roof rule) to victims of crime such as the appellant is devastating and cannot outweigh the need to limit the liability of the scheme from an entirely unproven cost.
"A fair balance has not been struck."
JT's case is being brought in England and Wales and there are separate challenges to the rule in Scotland and Northern Ireland.
The Independent Inquiry into Child Sexual Abuse recommended in its interim report in April that the rule should be scrapped.
Lawyers representing the CICA argued that, even if the court finds in favour of JT, she will only be entitled to a declaration and not compensation - because any changes to the rules are a matter for Parliament.
Ben Collins QC told the court the Government's decision not to extend the compensation scheme to pre-1979 victims in 2012 was "justified".
He said the reforms were designed to make the scheme "sustainable" and to "reduce the burden on the taxpayer" and therefore "choices had to be made" about who would and would not be paid compensation.
Mr Collins added: "If the scheme were extended for some, then it might have to be limited for others.
"Such choices are for Parliament."
The Equality and Human Rights Commission has also made submissions in the case.
The case is being heard by Sir Terence Etherton and two other judges, who are expected to deliver their ruling at a later date.
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