Former racehorse strapper Luke Quintano almost died after he was shot in the head during a brawl at a Sydney nightclub.

Mr Quintano spent 10 months in hospital after he was shot at close range at Skelsey's in Lansvale, west of Sydney, in December 2002.

"I was in the toilet and I've come out and seen my friends fighting and I'd rushed in there and one bloke grabbed me in a headlock and shot me," he said.

He lost an eye and required major reconstructive surgery to his skull and face. He is paralysed down one side of his body and confined to a wheelchair.

Since the shooting, the 37-year-old and his father, Stephen Quintano, have waged a long battle for justice through the courts.

"We've been through hell and back," Stephen Quintano told the ABC.

"If somebody had told me about what he went through, I think it would be too unbelievable.

"What we've been through is a disgrace".

Mr Quintano is taking his fight for compensation to the Federal Government. ( ABC News: Alison Branley )

The man charged with the attempted murder, Azam Alameddine, fled to Lebanon the day after the shooting and it took four years to extradite him back to Sydney to face trial.

The Quintanos were bitterly disappointed when he was acquitted in 2006.

Luke Quintano then sued the nightclub owners for negligence in the NSW Supreme Court.

In 2009, he was awarded more than $4 million in damages.

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But in another cruel twist of fate, the nightclub's insurer, International Unity Insurance, went bust before he could get his money.

The company was deregistered in Australia and had been trading insolvent for years.

Stephen Quintano, who had to quit his job as a horse trainer to look after his son, said they were struggling to survive on pensions.

Quintanos turn to Government seeking compensation

The family is now appealing to the Federal Government for a special "act of grace" payment to cover Luke's care costs.

What are act of grace payments? It is an avenue of last resort and is used only where there is no other viable avenue to provide redress.

It is an avenue of last resort and is used only where there is no other viable avenue to provide redress. They payments are usually decided on by the Finance Minister

They payments are usually decided on by the Finance Minister Payments can be made when actions of the Government have resulted in loss

Payments can be made when actions of the Government have resulted in loss Anyone can apply Source: Department of Finance

In a letter to Finance Minister Matthias Cormann, their lawyer said the government's financial regulators knew the insurance company was in trouble, but failed to act.

"There was a serious failure of prudential and corporate regulation," the letter says.

"Specifically, APRA and/or ASIC failed to detect and prevent the unregulated and fraudulent conduct of the insurers and to warn the insured in sufficient time to enable it to make alternative arrangements or try to minimise its risks."

Stephen Quintano believes the regulators are to blame for his son's predicament.

"We think we are being protected by the governing bodies, but they are just grossly incompetent or worse, because the shareholders involved, who were trading insolvent, are still managers of companies today — still trading as the heads of other companies at the moment," he said.

Mr Quintano said former House of Representatives speaker Peter Slipper received an act of grace payment to defend a case brought against him by former staffer James Ashby.

"Surely my son's case is far more deserving than Mr Slipper's," he said.

Labor rejected Quintano's last compensation bid

It is the second time the family has applied to the government for an act of grace payment.

In 2011, their application was knocked back by the former Labor government's special minister of state, Mark Dreyfus.

Luke Quintano appealed the decision in the Federal Court but lost because he could not prove the minister made an error of law.

Now he is pleading with the Turnbull Government to show some compassion.

His lawyer argues Mr Dreyfus wrongly decided that there was no moral obligation to grant the payment.

"It is clear that because of APRA and ASIC's failure to properly carry out their respective functions ... there would at least by a moral obligation for Mr Quintano to receive an Act of Grace payment".

Assistant Finance Minster Peter Hendy said he was unable to comment on individual claims for act of grace payments for legal and privacy reasons.