The NSW Crown Solicitor has apologised to child sex abuse victims who were asked to prove they were abused even though the state knew they had been.
Ian Knight told the sex abuse royal commission the state did not act fairly on several counts when it defended a compensation case brought by 15 former residents of Bethcar, a foster home for Aboriginal children in Brewarrina in remote NSW.
For two weeks the commission has been hearing how the state handled allegations of physical and sexual abuse at the home run by Burt and Edith Gordon and their son-in-law Colin Gibson between 1969 and 1989.
The Gordons are dead but Gibson was jailed in 2007 on two sentences totalling 30 years.
Mr Knight said when the Crown Solicitors' Office legal team asked plaintiffs to prove the abuse happened for the 2008 civil claim, they were wrong.
"I think we breached the model litigant rule there," he said on Thursday.
"I apologise to the plaintiffs to the extent the CSO contributed to that, it was a breach of the model litigant policy."
Because of delays and legal technicalities the claim only settled earlier this year - all up it cost the state $3.7m.
Model litigant rules require the state not to ask a party to prove something already known, to act fairly, avoid undue delays and use mediation where practicable.
Mr Knight apologised that early offers of mediation were not accepted.
He said by June 2011 the team knew the plaintiffs were interested in "just an apology, some cash and costs".
"At that stage at the latest we should have been exploring mediation. I think that was a breach of the model litigant policy and I apologise to the plaintiffs."
Mr Knight also rejected any criticism of the Women's Legal Service or Bell and Johnston - the legal team for the plaintiffs.
Giving evidence before Mr Knight, barrister Patrick Saidi, who acted for the state, said the statement of claim by the plaintiffs was the worst he had seen in his career.
He also thought early mediation would not be effective because it required the plaintiffs' lawyers to understand the legal issues and he doubted they did.
Mr Saidi stoutly defended the state's conduct of the case, saying it had not breached model litigant requirements.
The hearing continues on Friday when private investigator Peter Maxwell, who the CSO hired to find relevant people and documents for the case, will be recalled to the witness stand, along with barrister Paul Arblaster and solicitor Evangelos Manalloras.