The victim, given the pseudonym AHA, told the royal commission into child sexual abuse he was molested by Mr Houston's father, Frank Houston, for a number of years from the age of seven.
Brian Houston, who earlier described his father's acts as "repulsive", rejected the claim that he told AHA the abuse was his fault or that he tempted his father, in a written statement released on Tuesday afternoon.
|Frank Houston, Died 2004|
AHA told the commission Mr Houston said: "You know it's your fault. You tempted my father."
AHA said that when he asked Mr Houston whether he too had been abused by his father, the preacher slammed down the phone - a claim also denied by Mr Houston.
AHA told the hearing that his family was heavily involved in the Assemblies of God, now known as Australian Christian Churches.
The Houstons were close friends and would often stay at AHA's family home in Coogee when they visited Sydney.
AHA said he would often wake up to find Frank Houston in his bedroom, recalling: "I remember him touching me inappropriately ... I would be petrified."
Under cross-examination from counsel assisting, Simeon Beckett, AHA said Frank Houston had touched his genitals and digitally penetrated him. The molestation stopped when AHA reached puberty.
He did not disclose the abuse until he was 16 when he told his mother, who advised him to stay quiet.
"It was very difficult for her to accept ... the Houstons were considered to be almost like royalty in those circles," he said.
|Brian Houston, Lead Pastor Hillsong|
In 1998, AHA's mother disclosed the abuse to a senior pastor at the Emmanuel Christian Family Church, who said she would refer it to the Assemblies of God hierarchy instead of the police.
Shortly afterwards, Frank Houston, then aged in his late 70s, got in touch with AHA to offer financial compensation.
AHA said Frank Houston told him: "I want your forgiveness for this. I don't want to die and have to face God with this on my head."
They met at McDonald's in Thornleigh where AHA was asked to sign a food-stained napkin in return for a cheque for $10,000.
When Brian Houston, the national president of the Assemblies of God in Australia from 1997 to 2009, became aware of allegations against his father he suspended him from the church.
The commission heard a meeting of senior Assemblies of God members was called and it was decided that the allegation would be kept confidential. When other allegations of abuse involving six boys in New Zealand came to light, it was decided that Frank Houston would retire, without the exact reason being made public.
Frank Houston, the founder of the Sydney Christian Life Centre which merged with the Hills Christian Life Centre to become Hillsong Church, died in 2004.
Brian Houston, who will also appear as a witness, released a short statement responding to AHA's version of the phone call.
The hearing into how Australia's Pentecostal churches handled child abuse allegations among their ranks will also examine two other cases, one involving a teacher who molested scores of young children at the Northside Christian College in Victoria and another involving a youth pastor at a church on the Sunshine Coast.
The hearing before commissioner Jennifer Coate is expected to continue until October 17.