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Supreme Court of the ACT Decisions |
COURT
IN THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORYCATCHWORDS
Defamation - identification of plaintiff - whether publication complained of identifies plaintiff and not companies of which he is director - no new question of principle.Defamation - defamatory meanings and imputations - whether publication conveys imputations alleged - no new question of principle.
Defamation - defences - qualified privilege - whether available by reason of reciprocity of interest of reader and newspaper - information on public register - whether available for republication of erroneous statement by public official.
Defamation - defences - truth and substantial truth - no new question of principle.
Defamation - defences - fair comment - statement of fact and statement of opinion - whether defence of comment available when based on false assumptions or statements of fact.
Defamation - defences - partial justification, Polly Peck principles, contextual imputations - whether any difference between defences of this nature - whether available in ACT - common sting - whether unjustified imputation further lowers reputation - effect on damages.
Defamation - defences - illegal conduct on part of plaintiff - whether illegal conduct disentitles plaintiff to recover damages.
Defamation - damages - aggravated damages - hurt to feelings - assessment of damages in light of justified publication by defendant of matters affecting plaintiff's reputation.
Conflict of Laws - defamation - publication in several States and Territories - "multiple simultaneous torts " - whether law of each State and Territory to be applied in action brought in ACT for Australia-wide publication - application of Breavington v. Godleman - flexible exception to general rule of application of lex loci delicti - application only of law of place with most substantial connection to publication.
Costs - case made unnecessarily lengthy and complex by defendant - whether defendant should be liable for more than party and party costs - whether defendant should be liable for costs limited to scale appropriate to amount recovered.
Defamation Act 1901 (NSW) in its application to the ACT
New South Wales Defamation Act 1974, s.16
Companies Act 1981 (Cth)
Lewis v. Daily Telegraph Ltd. (1964) AC 234
Hook and Another v. John Fairfax and Sons Ltd (1982) 42 ACTR 17
Australian Broadcasting Corporation v. Comalco Ltd (1986) 68 ALR 259
Adam v. Ward (1917) AC 309
Loveday v. Sun Newspapers Limited and Another [1938] HCA 28; (1937) 59 CLR 503
Perera (M.G.) v. Peiris and Another [1997] UKHL 17; (1949) AC 1 at 20
John Fairfax and Sons Ltd. v. Hook and Another (1982) 47 ALR 477
Reis v. Perry (1895) 64 LJQB 566
O'Shaughnessy v. Mirror Newspapers Limited [1970] HCA 52; (1970) 125 CLR 166
Polly Peck (Holdings) Plc. and Others v. Trelford and Others (1986) 2 WLR 845
Kennett v. Farmer (1988) VR 991 at 995-6
Hadzel and Another v. De Waldorf (1970) 16 FLR 174
Jackson v. John Fairfax and Sons Ltd. and Another (1981) 1 NSWLR 36
Hepburn v. TCN Channel Nine Pty Ltd (1984) 1 NSWLR 386
Silkman and Anor v. Federal Capital Press of Australia Pty. Limited (unreported, Supreme Court of the ACT, 8 December 1989)
TWT Limited v. Moore (unreported, Supreme Court of the ACT, 31 October 1991)
Howden v. "Truth" and "Sportsman" Limited and Another (No. 2) (1938) 38 SR (N.S.W.) 287
Khashoggi v. IPC Magazines Ltd. and Another (1986) 1 WLR 1412
Kelly v. Special Broadcasting Service (1990) VR 69
Smith's Newspapers Limited and Another v. Becker [1932] HCA 39; (1932) 47 CLR 279
Allsopp v. Incorporated Newsagencies Co. Pty. Ltd. (1975) 26 FLR 238
Comalco Ltd. v. Australian Broadcasting Corporation (1985) 64 ACTR 1
Smith v. John Fairfax and Sons Ltd. (1987) 86 FLR 343
Gutman v. Clouston and Australian Consolidated Press Ltd. (unreported, Supreme Court of the ACT, 13 July 1989)
Toomey v. Mirror Newspapers Ltd. (1985) 1 NSWLR 173
Waterhouse and Others v. Australian Broadcasting Corporation (unreported, Supreme Court of the ACT, 23 June 1987)
Bogusz v. Thomson and Another (1989) 95 FLR 167
Breavington v. Godleman and Others [1988] HCA 40; (1989) 169 CLR 41
Baffsky v. John Fairfax and Sons Limited (unreported, Supreme Court of the ACT, 14 August 1991)
McKain v. R.W. Miller and Co (South Australia) Pty Ltd [1991] HCA 56; (1991) 104 ALR 257
Waterhouse (R W) v. Australian Broadcasting Corporation (1989) 86 ACTR 1
HEARING
CANBERRACounsel for the plaintiff: Mr M. Sexton
Solicitors for the plaintiff: Colquhoun Murphy
Counsel for the defendant: Mr J. Garnsey, QC with Mr B. Connell
Solicitors for the defendant: Macphillamy Cummins and Gibson
ORDER
That there be judgment for the plaintiff in the sum of $15,000.00.DECISION
The plaintiff sues the defendant for damages for libel. The claim is about an article commencing in the eighth column of the front page of the issue of The Canberra Times for 29 June 1989.2. That part of the article appearing on the front page is as follows
(paragraph numbers added):
"Probe launched into Woodger
By IAN DAVIS3. The article continues and concludes on page 2 as follows:
Finance Editor
Troubled Woodger property group and the company which controls the
Canberra Raiders - Canberra District Rugby League Football Club Ltd
- are to be investigated by the Corporate Affairs Commission over
their failure to lodge their 1988 financial results.
2. The planned investigation follows the public disclosure
yesterday of Woodgers' severe financial problems and efforts by the
group's chairman, Jim Woodger, to secure new equity capital and
loans to rescue the property group from financial collapse.
3. Woodgers is the Canberra Raiders largest sponsor and financial
supporter."
"Inquiry launched into Woodgers4. The plaintiff alleged that in their natural and ordinary meaning these words were defamatory of him. In a letter dated 6 June 1991 the plaintiff's solicitors gave particulars of the imputations alleged and I deal with these below under the heading "Defamatory meanings or imputations".
4. Woodgers was required by law to lodge its
financial returns for the financial year ended June 1988 by
the end of December 1988. The returns show the company's
profits or loss for the year and the extent of its assets and
liabilities. The Canberra District Rugby League Football
Club, whose financial year ended in October 1988, was
required to lodge its returns by the end of March 1989.
5. While it is not uncommon for companies to fail
to lodge their financial returns by the due date, Woodgers'
failure comes at a time when it is in severe financial
difficulties and attempting to negotiate new financial
arrangements with banks and other financial institutions to which it
is understood to owe well over $10 million.
6. The failure to lodge its financial returns
means that details of the full extent of its indebtedness and
financial problems are not publicly available.
7. Coinciding with Woodgers' financial
difficulties, Westpac Banking Corporation and the ANZ Bank
have registered with the Corporate Affairs Commission charges
over the assets of the Woodger Group, a number of its
subsidiaries and over the assets of the Raiders.
8. All the charges (or claims to the assets) of
the Woodger group of companies are held by Westpac and were
registered in February and March this year. The registration
of the charges appears to coincide with growing concern about
Woodgers' financial viability on the part of the financial
institutions which had lent substantial sums to Woodgers.
9. As reported yesterday, Woodgers' major
creditors are understood to be Westpac, the Commonwealth
Bank, Canberra Building Society, Civic Advance Bank and the
West Australian-based Challenge Bank.
10. The registration of the charges over Woodgers'
assets increases the security for the financial institution
which has the charge and gives it precedence over other
secured creditors in the event of the winding up of the
company.
11. Westpac has charges over all the undertakings
and assets of the Woodger Group and its subsidiaries and
separate charges over the assets and undertakings of Woodger
Properties and Woodger Developments, which are subsidiaries
of Woodger Group.
12. The ANZ Bank registered a charge over the
assets and undertakings of Canberra District Rugby League
Football Club as recently as 13 June.
13. Neither Woodgers nor the Raiders appear to have
had registered charges over their assets previously."
5. The publication was in the Australian Capital Territory and in New South Wales, Victoria, Queensland and Western Australia.
6. By its further amended defence, the defendant admits the publication and
raises a number of matters by way of defence both under
the law of the
Australian Capital Territory and the laws of the States of publication. At
this stage I deal only with the defences
pleaded under the law of the
Australian Capital Territory. The Territory law of defamation is the common
law, except insofar as
it is modified by the Defamation Act 1901 (NSW) in its
application to the Territory. In summary the defences pleaded are as follows:
a denial that the publication was defamatory of the plaintiff, an assertion of
qualified privilege, an assertion of fair comment,
an assertion of truth
and/or comment (the rolled up plea), an assertion of partial justification and
(possibly) so-called "contextual
imputation" and an assertion of illegal
behaviour on the part of the plaintiff.
Factual Background
7. Despite the substantial amount of factual material that was brought to bear in the case, some parts of which it may be necessary in due course to look at in some detail, the essential facts are relatively simple. The plaintiff was at the time of publication the person who had the controlling interest in a group of companies at the centre of which was a company called Woodger Group Limited (WGL). It is appropriate to set out something of his personal history and business interests.
8. The plaintiff was brought up in Cooma, leaving school there in 1968 and commencing work with a Queanbeyan real estate agency, T.E. Woodger and Sons. In 1972 the plaintiff became a licensed real estate agent, borrowed some money and purchased the real estate business from his employer. There was little growth in the business during the several ensuing years, but towards 1980 a branch of the real estate agency was formed in Canberra, and the business diversified into other activities such as property development and the wholesale and retail sale of petroleum products. In 1981 the business was taken over by a company, Woodger Corporation Limited, with the plaintiff as chairman and managing director. The business then expanded rapidly, with real estate agency offices in several towns in the ACT and New South Wales and with wholesale and retail outlets for petroleum products independent of the major oil companies in the ACT and three States. By 1986 the business reached a peak with an annual turnover of $45 million, a staff in excess of 700 employees, and "market capitalization" of some $24 million. In 1986-1987 there was some sort of a merger with or takeover by Finemores Transport Group of Wagga, New South Wales. Woodger Corporation Limited, which was by then listed on the Melbourne Stock Exchange, changed its name to Finemore Holdings Limited, and the plaintiff ceased to have control. The plaintiff formed a new company, WGL, which purchased from the former company some of its interests in real estate agencies, insurance brokerage and property development. WGL was the holding company and various other subsidiary companies carried on particular business activities. One of the group companies purchased the business of Australian Forwarding Agencies, a freight forwarding and custom handling business based at Mascot in Sydney, and an associated business or company or group of companies known as or referred to in the evidence as Fliway, which was also in the freight business. Once acquired, however, the Fliway business did not turn out to be profitable, and was sold at a later stage.
9. Following the sale of Fliway the real estate agency business was also sold, the purchaser being the Canberra Building Society (CBS). The sale facilitated the freeing up of borrowed funds which were put towards the purchase by WGL of a plant and equipment hire business, Hire Kingdom New South Wales Pty. Limited, and a Canberra-based electrical contractor, Scotts Electrical Pty. Limited.
10. In 1983 Woodger Corporation Limited became the major sponsor of the Canberra Raiders Rugby League football team. In 1985 the plaintiff became a director of the Canberra and District Rugby League (formally a limited company) and in 1989 the chairman, a position he was still holding at the time of the hearing.
11. In September 1989 WGL acquired the real estate business (by then known as Realty World) back from CBS in a complicated and obscure financial manoeuvre which involved the issue to CBS of redeemable preference shares in WGL. The plaintiff initiated steps which were ultimately unsuccessful to have the real estate business vested in a company already listed on the Adelaide Stock Exchange, Belgravia Limited, to be controlled by WGL. Liquidity problems became acute in 1988 and 1989 with increasing pressure from the banks.
12. A receiver was appointed by Westpac to the WGL on 11 July 1989 and from about a month thereafter the plaintiff ceased to carry on any active duties in relation to the running of the group. At the time of the hearing he was a consultant to a developer in the business of design and construction of serviced apartments.
13. In addition to his active interests in Rugby League, the plaintiff has been involved in other community activities in the Queanbeyan and Canberra district, for instance in the Apex Club. In 1981 the Woodger Corporation Community Fund was launched to support worthy local causes, particularly young athletes. WGL contributed $250,000 to the fund.
14. In summary, by the time of the publication on 29 June 1989, the name
Woodger was well known to a substantial proportion of newspaper
readers both
in the ACT and in the surrounding parts of New South Wales, particularly
Queanbeyan, and was familiar to the general
reader in those parts. I am not
satisfied that the plaintiff was well known to the general reader in other
parts of New South Wales
or to the general reader in Victoria, Queensland or
Western Australia. The notoriety which he had achieved resulted from a
combination
of the long-standing association of the name Woodger with real
estate business in the area, the comparatively recent expansion of
Woodger
companies into other business ventures, the prominent support given by Woodger
companies and by the plaintiff to the Canberra
Raiders and the increasing
publicity given to the financial difficulty of the Woodger companies and the
Canberra District Rugby League
Football Club Limited.
The Woodger Companies and The Canberra Times
15. The defendant was a major contributor to the publicity given to the plaintiff and to WGL. The Canberra Times reported the fluctuating fortunes of the Woodger companies. Such reports frequently, if not usually, referred to statements made by the plaintiff and presented him as a personable, progressive and public-minded figure.
16. Until the end of 1985 the reports were invariably of increasing diversification and prosperity. A paragraph in the publication of 19 December 1985 noted the intended takeover of the Fliway Group as if it were just part of what seemed "never ending expansion of business activities" and not, as it turned out to be, one of a number of clouds on an otherwise bright horizon.
17. Then, in March 1986 came the first suggestions of trouble brewing. There were reports of dissension amongst the directors, a "leadership challenge" and even a threat that the corporate headquarters be moved to Wagga. The reallocation of business and resources in association with the Finemore interests followed, the plaintiff reportedly acquiring the real estate and insurance interests for $2.85m.
18. On 26 November 1986, The Canberra Times reported the takeover of Australian Forwarding Agencies in a "$4m deal" as a major acquisition for the Woodger group, which was re-establishing "after the takeover of the former Woodger Corporation by Finemore Holdings earlier this year".
19. The sale of the real estate interests to CBS Realty World in September 1987 was reported in The Canberra Times as was the repurchase of those interests by WGL, such report appearing on 27 August 1988.
20. In 1986, Mr Ian Davis had joined The Canberra Times as its Finance Editor. None of the articles just mentioned bore his name as the author. He was, however, aware of the plaintiff's business interests, and of the activities of WGL, but did not himself write on these matters nor become personally acquainted with the plaintiff until late 1988.
21. After a conversation with the plaintiff at that stage, Mr Davis wrote an
article published on 16 February 1989, headed "Woodger
Realty World set to go
public". It was based entirely on what the plaintiff told him and what he had
learned from material in The
Canberra Times' files. The article reported that
Woodger Realty World was to be "sold into" Belgravia Limited and it quoted the
plaintiff as saying:-
"We would plan to sell the rest of the group into the publiclyThis article noted further that the worth of the companies was about $20m in addition to the real estate operations valued by Touche Ross at $6m. The article also noted that the Belgravia takeover involved the redemption of $2m of the $5m redeemable cumulative preference shares in Woodger Realty World owned by CBS.
listed company later in the year when the market is healthier."
22. After the article of 16 February 1989 there were conversations between the plaintiff and Mr Davis relating to the proposed Belgravia float, to rumours which Mr Davis had heard about WGL being in financial difficulties and to the future of WGL generally. Articles appeared written by Mr Davis on 8 March and 5 June 1989 following such conversations and reporting the substance of their content.
23. Then on 27 June 1989, Mr Davis had a conversation with the plaintiff which is of particular importance. He put it to the plaintiff that there were strong rumours circulating that the Group was in financial difficulties, that some of the banks had confirmed that to be the case, that it was a matter of public interest and that before he wrote anything on the matter Mr Davis wanted to talk to the plaintiff about it. The plaintiff confirmed that the Group was in financial difficulties but insisted that he was well advanced on a rescue package which would involve a group of Sydney investors injecting $4.5m equity capital into the company.
24. The plaintiff expressed concern to Mr Davis that these matters had been broadcast because, as he told Mr Davis, "people in positions of authority had been blabbing". The plaintiff further told Mr Davis that he continued to be supported by the banks, that the banks had been acting reasonably in the circumstances and that there was no prospect of finance being withdrawn at that stage.
25. The plaintiff tried to dissuade Mr Davis from publishing anything on
these matters until after the plaintiff made an announcement
which he planned
to do the following week. Mr Davis told the plaintiff that the story had such
wide currency that it was inevitable
that it would get into the media in the
meantime and suggested that it would be in the plaintiff's own interests to
comment rather
than be the subject of a report which did not include his side
of the story. According to Mr Davis, the plaintiff accepted this,
acknowledged that the conversation was "on the record" and indicated his
acceptance that there would be publication following the
conversation. I
accept the evidence of Mr Davis on this and other aspects of the conversation
of 27 June 1989.
28 June 1989
26. The following day, 28 June 1989, an article headed "Woodger Rescue Plan"
appeared in The Canberra Times. There is no issue that,
insofar as it
purports to be a record of the conversation had the previous day, it is
accurate, and no complaint is made that it
is defamatory of the plaintiff.
Under the headline of the article of 28 June 1989 appeared the name Ian Davis,
Finance Editor. A
photograph of the plaintiff appeared as an insert in the
article. Under the photograph appeared the following words: "'My position
is
up to the board' - Jim Woodger". The article itself commenced with the
following paragraphs:
"A multi-million dollar rescue package is being finalised to save27. The article of 28 June 1989 went on to quote a number of statements from the plaintiff relating to the financial position of WGL. It referred to rumours of the impending collapse of WGL and concern that such collapse could have a domino effect. It described the restructuring proposal to resolve the financial difficulties of the WGL. There was particular reference in the article to the Belgravia float as it had been explained by the plaintiff to Mr Davis.
from collapse the Canberra and Queanbeyan real-estate and
property-development empire of Jim Woodger.
The Woodger group of companies which has a major shareholding in the
company associated with the Woodgers Canberra Raiders, is understood
to have debts of well over $10 million owing to financial
institutions including the Commonwealth Bank, Westpac, Canberra
Building Society, Civic Advance Bank and the Western
Australian-based Challenge Bank.
In some cases loans have fallen due and have not been repaid; in
other cases the Woodger group is in default on interest payments.
Jim Woodger confirmed last night that he was in financial
difficulties and said 'the group is carrying a lot of debt'."
28. Later that same day Mr Davis was concerned to look further into the financial position of WGL and the Canberra Raiders.
29. In the belief that "there would be bound to be some sort of follow-up story" and that it might be possible to obtain more information than the plaintiff had provided, Mr Davis went to the Canberra Office of the Corporate Affairs Commission (CAC) in order to conduct a search relating to the Woodger companies and to the Canberra District Rugby League Football Club. He was familiar with the search procedures and regarded the CAC records as a very useful resource for writing about companies.
30. At that time, information on the CAC files was available either direct from the documents in the files themselves or from a computer. The information in the computer was available to CAC staff either from the screen or from a printout. Sometimes particular documents, although in the CAC office, were not in the file relating to the particular company, and it appears that the whereabouts of such documents had to be ascertained from the computer. Members of the public making a search were allowed access to the file of the particular company concerned and to the documents contained in it, but did not have direct access to the computer. Mr Davis was aware that some information was kept on computer which may have differed from or added to what was available on the file. He had never sought information from the computer on a previous occasion, but had noticed that when there was difficulty in locating a file, the CAC staff would make use of the computer in order to locate the file.
31. Mr Davis arrived at the CAC offices at about 2.00 p.m. He obtained the numbers of the files of the companies which he wanted to search from a microfiche system in the public area, completed the necessary requisition forms, handed them to a clerk and was given the files relating to WGL and some other companies bearing the Woodger name, as well as the file relating to the Canberra District Rugby League Football Club Limited.
32. In the Woodger Group Limited file there was no annual return for the year ended 30 June 1988, although there were annual returns for previous years. Similarly, there was no annual return for the year ended 30 June 1988 relating to the Canberra District Rugby League Football Club Limited.
33. Mr Davis then went and spoke to a counter clerk. He asked whether the 1988 annual return might have been lodged but not placed on the file, and if that were the case whether it would be recorded on the computer. The clerk replied that if the returns had been lodged that fact would be recorded on the computer system. The clerk went to the computer terminal. Mr Davis told the clerk the names of the two companies under consideration and the clerk typed on the keyboard. The computer screen was not visible to Mr Davis. The clerk then said, "No, there's no record of that return having been lodged". Mr Davis then enquired of the clerk what the procedure was in CAC when annual returns were overdue. The clerk replied, "It becomes a matter for investigations". Mr Davis then asked, "Is Peter Meyers still head of investigations?", and was told that that was correct.
34. Mr Davis then returned to the office of The Canberra Times, at that time located in Mort Street, Civic, and tried to telephone Mr Peter Meyers who was known to him. At this stage the time was about 5.10 p.m. The telephone was answered by a secretary who said that Mr Meyers was on holidays and that a Mr Tim McDonald was acting in his absence. The secretary told Mr Davis the telephone number of Mr McDonald.
35. The evidence about the conversation on 28 June 1989 up to this point came entirely from Mr Davis. The CAC clerk or clerks were not called nor was the CAC secretary, but I have no reason to reject the evidence Mr Davis gave.
36. There is a divergence in the evidence given by Mr Davis from that given by Mr McDonald as to exactly what was said in the conversation which took place when Mr Davis rang the number which the secretary gave him.
37. According to Mr Davis he explained to Mr McDonald that he had been
searching the CAC files in the light of the story that had
appeared that
morning, that the latest annual returns of the two companies were not on the
files and that counter staff had checked
the computer and confirmed that the
annual returns had not been lodged. Mr Davis then enquired as to what action
was being taken
in relation to Woodger or the Raiders. Mr McDonald replied
that he was not aware that the annual returns of those companies had
not been
lodged and that the office was currently going through the returns to check
which companies were overdue in lodging the
returns. Mr Davis' evidence
continued as follows:-
"Did he say anything else? - - - He said to me words38. The evidence of Mr Davis as to the rest of the conversation is a little unclear but I take him to have said that he asked Mr McDonald whether he could quote Mr McDonald as saying that the companies would be investigated and that Mr McDonald replied by saying that he wanted to check with the Commissioner before putting anything on the record. Mr Davis then asked Mr McDonald if he would check and call him back and informed Mr McDonald that he proposed to publish an article the next day stating as a fact that the returns had not been lodged and that the non-lodgement was being investigated. According to Mr Davis the conversation finished when he said to Mr McDonald,
to the effect that now that I'd informed him about the fact
that the Woodger and the Raiders annual returns hadn't been
lodged that the Investigations Section would have a look at
it .....
Now did you ask him anything in relation to annual
returns? - - - Yes, I said to Mr McDonald words to the
effect that 'Could I take it then that Woodger and Raiders'
failure to lodge their returns would
be investigated?' and Mr McDonald said, 'Yes, we will
investigate.'"
"If you could call me back and tell me whether I canand that Mr McDonald's response was, "That was fine. That arrangement was fine, he was happy with that arrangement."
attribute that to you personally Mr McDonald, or to the
Commissioner, and if there are any problems with publishing
that fact that they are being investigated, if you could also
call me back.",
39. In a notebook which he kept at the time (exhibit 15) Mr Davis wrote the
following:
"WOODGER GROUP LTD CC2252740. There is no dispute about what Mr Davis did immediately after that, although again the evidence comes only from Mr Davis. He rang several telephone numbers in an attempt to locate the plaintiff and by 7.00 p.m. spoke to a female person on a number which he understood to be the home telephone number of the plaintiff. He told her that he had written a story in relation to Mr Woodger's companies that day and was proposing to publish a further story the following day and was anxious to speak to Mr Woodger before he published that story. He did not receive a telephone call from Mr Woodger or on behalf of Mr Woodger or WGL in response to that message.
No annual report lodged.
CANBERRA and DIST RUGBY LEAGUE CLUB CL18099
Not lodged.
Appears in default Investigations
Peter Meyers"
41. Mr Timothy John McDonald was a clerk class 5 in the Investigations
Section of the Corporate Affairs Commission, responsible for
investigating and
initiating action for minor offences, amongst which he included the failure to
lodge an annual return. His evidence
was as follows. He normally ceased work
at 4.51 p.m. At about 5.00 p.m. on the day in question he was still at work
about to leave,
when the telephone rang. Mr Davis identified himself. Mr
Davis said that he had been into the CAC Office earlier that day, had
tried to
obtain the 1988 return for the Woodger Group Limited and that the counter
clerk had said that it was not there. Mr McDonald
said that he told Mr Davis,
"All right, I'll look it up". He left the phone, went to the computer and
called up the particular computer
entry for Woodger Group Limited. He
concluded from what he saw on the screen that the 1988 return had probably not
been lodged.
He returned to the telephone and said to Mr Davis, "It looks
like it hasn't been lodged". There was an exchange about recent interest
in
the company and the importance for information to be on the file and available
to the public, and Mr Davis then asked what usually
happened when returns were
not lodged. Mr McDonald said that according to the best of his recollection
he replied,
"Well the Commission would then look at the matter and issue42. The evidence of Mr McDonald continued:-
a penalty notice on the company, which response would be
either for the company to lodge the annual return with a
penalty or, if it didn't do so, then the company may be
prosecuted for not lodging the annual return."
"Mr Davis said to me, 'Do many companies not lodge annual43. Later on 29 June 1989, following the publication of the article complained of, CAC, through the Attorney-General's Department, issued the following press release -
returns?' and I said, 'There are a great number of them.' - a
number of them, I can't just think which one I said. And he
said to me, 'Well what are you going to do about the Woodger
one?' and I said 'Well, I'd look into it.'
...He said, 'Can I say you'll investigate the matter?' and I
said 'Well I'll look into it.' And then he said to me,
'Well, you're an investigator, aren't you?' and I said, 'Yes'.
...The next day I got into work and was faced with a barrage
of questions and the article itself. I didn't look into it,
it was already looked into by others."
"NO PROBE INTO WOODGERS44. On the same day the defendant obtained from the CAC a facsimile of a printout of an extract of information relating to WGL held by the CAC in its computer base. The extract is prefaced by this statement:
The Canberra Times reported on 29 June 1989 that two ACT
companies, Woodgers Group Limited and Canberra District Rugby
League Football Club Limited, are to be investigated by the
ACT Corporate Affairs Commission over their failure to lodge
their 1988 financial results.
The Acting Commissioner for Corporate Affairs,
John Pinkerton, announced that the ACT Corporate Affairs
Commission is not investigating either of the companies.
Both companies are required to file annual returns together
with accounts for their last financial year. Details about
Directors and a range of other public information are
recorded in annual returns.
Woodger Group Limited in fact filed its 1988 return and
accounts in April 1989. Routine clarification of details in
the return were sought and obtained from the company and the
return and accounts are now available for public search at
the Commission's office.
The Commission has asked the Canberra District Rugby League
Football Club Limited to file its 1988 annual return and
accounts, which were due by 31 January 1989.
The Canberra Times also reported that the companies appear
not to have had registered charges over their assets prior to
those mentioned in its article. However, the public file of
the Woodger Group Limited records charges prior to those
mentioned and the details are available for public search at
the Commission's office."
"Documents listed that are shown with a recorded date are available45. The first page in the extract following the preface just referred to consists of a list of documents by description together with, for each document, a folio number, a date received and a date recorded. With one outstanding exception the documents are listed in chronological order, the last document being described as "Particulars/Change of Dirs" folio no. 52, date received 06/04/89, date recorded 23/05/89. The outstanding exception is the entry relating to the annual return for 1988. It appears not in order of chronology but at the very top of the list. It is the only document not shown with a folio number or with a date recorded. But it does show a date received. That date is 13 April 1989. In my view it is likely that the list was so long that the entries could not all be shown at the one time on the computer screen. It follows that if the computer entries were shown on the screen extending to the most recent entry, that relating to the document recorded on 23 May 1989, then the entry relating to the annual return for 1988 would not show on the screen at the same time. This appears to be the likely explanation for the counter clerk and Mr McDonald both failing to observe the entry for the 1988 annual return when they looked at the computer screen on 28 June 1989. It was not on the screen to be observed but could have been called up to be so observed by appropriate command to the computer.
for search on the company's file at the Commission's office on
payment of the usual fee. Documents that are shown as having a date
received but not recorded have been received by the Commission, but
as they have not been processed as at the date of this extract they
are not on the company's file; and if they are of the type of
document from which information is sourced for a company extract,
any relevant information they contain is not included in this extract."
46. It was submitted on behalf of the defendant that for a number of reasons I should accept the evidence of Mr Davis where it conflicted with that of Mr McDonald. It was submitted that Mr Davis was a more impressive witness, that he was a careful, responsible and qualified journalist and that he kept a contemporaneous note. I find these reasons unconvincing. Although Mr McDonald was a younger and less experienced person, I do not think that he was less likely to remember or to try to tell the truth about what happened. My impression, after seeing him in the witness box and carefully considering his evidence in the light of all the other evidence, is that his memory of the conversation as it stood at the time he entered the office the morning following the conversation is likely to have been accurate and to have remained intact between then and the hearing. Furthermore, Mr Davis' note does not purport to be a verbatim transcription of what was said and is more likely to be a summary note of what he considered to be the effect of what he was told. The note "appears in default" indicates that there was some uncertainty about whether the documents in question had been lodged or not. I think it unlikely that Mr McDonald told him that the Commission would investigate the failure to file the annual returns in terms which would have suggested that it was to be something different from the routine enquiry which would follow from Mr McDonald having his attention directed to the absence of a record on the computer that the lodgement had taken place.
47. To complete the picture as far as this part of the case is concerned, it appears that senior officers in the Corporate Affairs Commission attended to the matter of the outstanding annual return for WGL on the morning of 30 June 1989. An examiner of documents, Ms Diane Butters, was instructed by Mr Simpson, the Manager of the Examination and Records Section, to take the annual return that day to the offices of WGL at the Melbourne Building in Canberra. She did so, some alteration was made by some person there, and she took the annual return back to the CAC office where it was placed on the file, whereby it apparently received the status of having been filed. An examination of the annual return (exhibit 5) shows that it was originally received by CAC in the post on 10 April 1989. According to Ms Butters it was not accompanied by the correct fee, was returned to WGL marked "insufficient payment of fees" and re-lodged on 13 April with the required late fee. According to Ms Butters, the company accounts were not attached when the document was initially lodged and I take it that the accounts were attached when the document was subsequently lodged on 13 April 1989.
48. There can be no question that the truth was as stated in the CAC press
release. Contrary to what the Canberra Times had reported,
the documents had
been lodged with CAC and there was no investigation or probe.
Identification of the plaintiff
49. The defendant in its further amended defence denies that the matter complained of was defamatory of the plaintiff. That denial is ambiguous. It may mean that the matter complained of did not bear any defamatory meaning; alternatively that if it did, any defamatory meaning was not of and concerning the plaintiff. The former issue is the issue of defamatory meaning or imputation, the latter issue is the issue of identification of the plaintiff. Both issues were fought at the hearing. The defence as to identification involved an assertion that the article was not about the plaintiff but about his company or group of companies and that if it was defamatory then it was defamatory not of the plaintiff but of that company or those companies.
50. Accepting that the standard to be applied on this question is that of the ordinary reader who is not slow to draw inferences: Lewis v. Daily Telegraph Ltd. (1964) AC 234, and perhaps even quick to jump to conclusions, it is not difficult to conclude that the ordinary reader would understand that it was the plaintiff who bore responsibility for the failure to lodge the 1988 financial returns which led to the planned investigation referred to in the article. The headline "Probe launched into Woodger" immediately places the reader in the position where he or she is receptive to the suggestion that behind the failures mentioned in the article is the figure of the plaintiff, a well known local figure. The reader, glancing at the article before reading it, or without reading it, is made to become aware that the plaintiff is having the finger pointed at him. The belief is not dispelled by subsequently reading the article itself. True it is that paragraph 1 refers to "Troubled Woodger property group and the company which controls the Canberra Raiders" and further refers to the fact that the group and the company are to be investigated by the Corporate Affairs Commission over their failure to lodge their 1988 financial results. No mention there of the plaintiff. However, this paragraph is followed immediately by reference to the public disclosure by the plaintiff himself of "Woodgers' severe financial problems" and his efforts to rescue the group from financial collapse. The ordinary reader would know that companies are controlled by real people and would be under the impression, correctly, that whatever the exact identity of the company involved, the Woodger company which was said to have failed to lodge its 1988 financial return was a company controlled by the plaintiff. This impression on the part of the ordinary reader is reinforced by the absence in the article of any precise identification of the company whose annual returns had not been lodged. The impression is further reinforced by the suggestion that it was only after the public disclosure by the plaintiff himself of the financial problems and efforts to overcome them, that the decision to investigate ("the planned investigation") was made. The inconsistent references to "Woodger" "Woodgers" "the Woodger Group", "the Woodger group of companies" and the possessive "Woodgers'" and "Woodger's" all leave the reader in a state of some confusion as to which corporate entity was involved, thus making it all the more likely that the reader would identify the plaintiff as the person responsible for the failure to file the annual return. It is likely that for many readers the information about the failure to file returns would have been received subsequent to reading the article "Woodger rescue planned" of the previous day, with its emphasis on statements by the plaintiff, its reference to the "property-development empire of Jim Woodger" and the prominent photograph of the plaintiff inserted into the article.
51. I have little difficulty in reaching the conclusion on the balance of
probabilities that the publication was of and concerning
the plaintiff.
Defamatory meanings or imputations
52. I consider each of the defamatory meanings relied upon by the plaintiff in the light of particulars furnished in a letter from the plaintiff's solicitors to the defendant's solicitors dated 6 June 1991. The term "imputation" and not "meanings" is used in New South Wales, and has there a significance which goes beyond that of a defamatory meaning. Nevertheless, the term "imputation" appears to be in wide and frequent use elsewhere and it is convenient to use it in relation to defamatory meanings in the publication in the Australian Capital Territory. I use the terms "imputations" and "defamatory meanings" interchangeably.
53. In the letter dated 6 June 1991 the plaintiff's solicitors withdrew the
allegations of imputations made in a previous letter
and restated those
imputations under five heads. The imputations were not stated or pleaded as
true innuendoes but as particulars
of the natural and ordinary meaning of the
words as relied on by the plaintiff.
"(a) That companies owned or controlled by the54. These two imputations may be dealt with together. In my opinion the publication bears the meanings contended for. There are essentially three propositions involved: first, that companies owned or controlled by the plaintiff had failed to file returns; secondly, that this was done in an attempt to conceal the true position from creditors and financial institutions; thirdly, that the plaintiff was party to this attempt. The reader would, in my view, take each of these propositions to be asserted in the article.
Plaintiff had to date failed to file with the
Corporate Affairs Commission documents showing their profits,
losses, assets and liabilities for the financial year ending
June 1988, in an attempt to conceal their true financial
position from their creditors; and that the Plaintiff was a
party to this attempt.
(b) That companies owned or controlled by the
Plaintiff had to date failed to file with the Corporate
Affairs Commission documents showing their profits, losses,
assets and liabilities for the financial year ending June
1988, in an attempt to conceal their true financial position
from banks and other financial institutions to which they
owed money, and with which they were currently attempting to
negotiate new financial arrangements; and that the Plaintiff
was a party to this attempt."
55. The article commences with a sentence which contains within it the statement that there was a failure by the "troubled Woodger property group" to lodge returns. In paragraph 2 it identifies the plaintiff as the chairman of the group and states that the plaintiff made public disclosure of the group's severe financial problems on the day prior to the article. Paragraph 2 refers also to the plaintiff's efforts to secure new capital and to rescue the group from collapse.
56. Paragraph 4 informs the reader that in the information contained in company returns are the profits and losses and the extent of the company's assets and liabilities.
57. Paragraph 6 states that the failure to lodge returns means that the state of the group's indebtedness and financial problems are not as at the date of the article available to the public.
58. Paragraphs 7 and 9 identify major creditors. All this, in my opinion, means that the reader would conclude that the failure to lodge returns resulted in a concealment of the true financial position from creditors and other persons interested and that the plaintiff bore or shared responsibility for that concealment.
59. However, it is paragraph 5 which connects the failure to file the returns
with an intention on the part of the person or persons
responsible that the
true financial position was to be concealed, at least until the recent
disclosure by the plaintiff. The curious
statement that the failure, which
must mean a failure to lodge returns, "comes" at a time of severe financial
difficulties and attempts
to negotiate new financial arrangements is at least
ambiguous. The ambiguity hints at some failure or wrongdoing on the part of
the
plaintiff. The failure, if there had been one, occurred at the end of
December 1988 and was still continuing, according to the article,
at the date
of publication. What "comes" at the time of the attempt to negotiate new
financial arrangements is simply the discovery
by the Canberra Times of what
was wrongly thought to be a failure to lodge the returns, that discovery being
made soon after the
disclosure by the plaintiff to Mr Davis of the problems
and of the negotiations. The reader is attracted by the very looseness of
expression to conclude that there is some connection between the failure to
lodge returns, the financial problems, the disclosure
by the plaintiff of
those problems and the plaintiff's efforts to secure new financial
arrangements. It is likely that the reader
would think that the failure to
lodge returns was linked with a desire by the plaintiff to keep the true
position from the scrutiny
of the financial institutions with whom new
arrangements were sought and from creditors generally.
"(c) That the Plaintiff was conniving in false60. I do not think that the publication bears the meaning that the plaintiff connived with others to make positive false representations to the financial institutions in the course of seeking new financial arrangements. The meaning contended for goes substantially further than the meaning that the plaintiff sought to keep information from those institutions and I do not think that the reader would go so far as to read into the article this particular defamatory meaning.
representations concerning the true financial position of the
Woodger Group of Companies, which were being made in 1989 in
the course of negotiations with banks and other financial
institutions to which the Group owed money, in an attempt to
obtain new loans or financial assistance."
"(d) The Plaintiff as Chairman of the Woodger Group of Companies,61. This defamatory meaning is clearly made out. For the reasons already given, the article associates the plaintiff in the mind of the reader with the failure to lodge returns. The headlines which declare "Probe launched into Woodger" and "Inquiry launched into Woodgers", together with reference to the planned investigation in paragraphs 1 and 2 of the article link the investigation with that failure and with the plaintiff's conduct.
participated in conduct by those companies that resulted in an
investigation of them by the Corporate Affairs Commission over their
failure to lodge their 1988 financial results."
"(e) That six months after the due date, companies62. This imputation is stated in ambiguous terMs Either it is an allegation of a meaning that no documents were lodged at all, in which case it adds nothing to paragraphs (a) and (b) and may be ignored, or it alleges that the documents lodged did not disclose the true financial position. If it is an allegation of the latter, then, in my view, it is not open in relation to the publication complained of. Nowhere in the article is there any statement express or implied that documents filed on behalf of WGL at CAC were inaccurate. It may be noted here that although the imputation is denied by paragraph 3 and the words in parentheses in paragraphs 8 and 9 of the further amended defence, paragraphs 8 and 9 set up further defences in the alternative and sub-paragraphs 8(f) and 9(f) positively assert on behalf of the defendant an imputation identical to that contended for by the plaintiff in paragraph (e) of his solicitors' particulars of 6 June 1991. I consider this aspect below in relation to the defence of partial justification and similar defences.
owned or controlled by the Plaintiff had not lodged with the
Corporate Affairs Commission documents showing the companies'
true financial position for the year ending June 1988, and
the Plaintiff was a party to that conduct."
63. I should state that the meanings contended for by the plaintiff relate to
companies owned or controlled by the plaintiff. The
article, in my view, is
more likely to suggest to the reader who reflects on the question that only
one company is involved, but
again the looseness of the references to the
"group" and the use of the plural in such phrases as "Woodgers' major
creditors" would
leave the reader suspecting that perhaps more than one
company was involved.
Qualified Privilege
64. The defence of qualified privilege is not provided for in the Defamation Act 1901 (NSW) in its application in the Australian Capital Territory and insofar as the defendant relies on it, regard must be had to the common law. It was submitted on behalf of the defendant by Mr Garnsey, QC, that the article was published on a privileged occasion. It was submitted that there is no general principle that a newspaper is precluded from relying upon a defence of qualified privilege. I did not take Mr Garnsey to dispute the proposition that, generally speaking, there does not exist between newspaper publisher and newspaper reader that reciprocity of interest in transmitting and receiving information which, when it exists, is sufficient to give rise to the availability of the defence of qualified privilege; see Hook and Another v. John Fairfax and Sons Ltd (1982) 42 ACTR 17; Australian Broadcasting Corporation v. Comalco Ltd (1986) 68 ALR 259. Nevertheless, as Mr Garnsey has submitted, the question of whether qualified privilege arises in a particular case may not always be determined simply by reference to a conventional category or categories into which the publisher and the reader may or may not happen to fit. The true question is whether the publication occurred on a privileged occasion. In some cases, the fact that the reader or the publisher may fit into a category previously recognized by the law as giving rise to a privileged occasion may be determinative of the issue. But it is true that the fact that the publisher happened to publish a newspaper in which the matter complained of appears does not necessarily disentitle the publisher from asserting that the occasion was a privileged one and that the defence of qualified privilege therefore arises. Cases may be found such as Adam v. Ward (1917) AC 309 and Loveday v. Sun Newspapers Limited and Another [1938] HCA 28; (1937) 59 CLR 503, in which the defence of qualified privilege has been successfully raised by a newspaper publisher. The correct approach appears to be to follow what the Privy Council said in Perera (M.G.) v. Peiris and Another [1997] UKHL 17; (1949) AC 1 at 20 and to apply "the wide general principle which underlines the defence of privilege in all its aspects rather than to debate the question whether the case falls within some specific category."
65. In Comalco Pincus J. at 342 put it in these terms:
"Despite a number of judicial denials that the categories are66. Despite the reference to authorities in which it has been held that qualified privilege was attracted to particular publications in newspapers on particular occasions, I am not convinced that the privilege was attracted to the occasion of the publishing of the Canberra Times on 29 July 1988. It was submitted that republication of information obtained from official sources is protected by qualified privilege. Arguably the protection of qualified privilege would have been afforded to a republication of the information obtained by Mr Davis from Mr McDonald that it appeared that the annual return of Woodger Group Limited for the financial year, 30 June 1988 had not been lodged. On the other hand, qualified privilege is not to be attracted to the publication of the untrue statement by the defendant that there was to be an official enquiry into the affairs of the company, nor to the remainder of the publication which sought by statements of mixed fact and opinion to connect the financial difficulties of the company or companies to the supposed enquiry and to the apparent failure to lodge the annual return. Neither of those matters involved a republication of what Mr McDonald had said.
closed, it seems clear that the law has proceeded in this area with
great caution and in such a way that the balance of authority is
clearly against the existence of the privilege claimed by the
appellant. Courts have evinced a strong reluctance to hold that the
broad principle above supports the existence of a duty to publish
any material not coming from or associated with an "authoritative"
source, particularly where the defamatory material is disclosed to
the public at large. We were referred to no case in England or
Australia in which there was held to be such a duty to publish such
material to the public at large, in the public interest; it was not
suggested that any of the established specific categories of common
law privilege applied."
67. Furthermore, the protection of qualified privilege does not extend to republication of official disinformation which does not accurately reflect the record.
68. In John Fairfax and Sons Ltd. v. Hook and Another (1982) 47 ALR 477, a
decision of a Full Court of the Federal Court of Australia
sitting on appeal
from this Court, it was said in the joint judgment of Gallop and Morling JJ.
at 489 that:
".....it is clear that no privilege attaches to the publication of69. Their Honours went on to cite Reis v. Perry (1895) 64 LJQB 566 in which Day J. said as follows:
an inaccurate extract from a public register, even though such
extract was officially supplied and thought by the publisher to be a
correct copy."
"It is perfectly clear that if a person publishes an extract from a70. Although this passage was cited with apparent approval by their Honours in Hook's case, it would not appear necessary to the actual decision and might therefore be regarded as referred to by way of obiter dictum only. Nevertheless, it must be given great weight by a single judge of this Court.
public document he is responsible if he has not correctly extracted
it, or if it has not been correctly copied. It is no answer that he
has been misled by a public official. The official may be to blame,
if any one is, but my impression is that the person who publishes
the statement for his own profit must take the risk of its being
incorrect. A person may see and take an extract, and if led to rely
upon it through a public official or any authorised person, whether
paid for such extract or not, he takes the responsibility for it,
though the above fact may go to diminish the damages; but it is no
answer to an action for defamatory publication. He takes the risk.
If he cannot show the accuracy of the extract, he is responsible
....."
71. Accordingly, in the light of the passage in Hook's case, I conclude that
the statements by the defendant that the annual return
had not been lodged and
that there was to be an official investigation were in the nature of
inaccurate extracts from a public register
and cannot be protected by the the
defence of qualified privilege.
Truth
72. The defendant pleaded in a "rolled up plea" that insofar as the imputations consisted of matters of fact they were substantially true and insofar as they consisted of opinion they were fair comment on matters of public interest. I deal first with the defence of truth and public benefit as it is raised in relation to each of the defamatory meanings set out in the plaintiff's solicitor's letter of 6 June 1991.
73. (a) and (b): The imputation that the plaintiff was a party to the failure to lodge the necessary document with CAC in an attempt to conceal the true financial position of companies controlled by him, is plainly untrue. There was no failure to lodge. The documents had been lodged. True it was that the documents were deficient to the extent that when first received by CAC on 10 April 1989 they were the subject of requisitions. As a result of the requisitions accounts were attached and the documents were relodged on 13 April 1989. True it was also that even on 30 June 1989, after the publication of the statement, the documents had not been placed on the file. CAC required something further to be done to them and Ms Butters took them over to the WGL offices where some alteration was made. True it was also that the CAC did not accord the documents the full status of having been filed, in contrast to having been lodged, until after all that was done on 30 June 1989. However, the reader would not have appreciated that difference, which is hardly surprising, as the author of the article did not appreciate it either at the time of publication. The article conveyed, as Mr Davis intended it to convey, the meaning that the documents had not got to the CAC at all, and that meaning was quite untrue. As it was untrue no issue of the publication being on a matter of public interest arises.
74. (c): I have already found this alleged defamatory meaning not established and it is unnecessary to investigate whether it is true or not.
75. (d): The imputation that the plaintiff's conduct led to an investigation by the CAC was untrue for the reasons I have already given. No issue of a matter of public interest arises.
76. (e): I have already found that this imputation, being ambiguous, is
either the same as (a) and (b) above, or it is not established.
In the former
case it has already been dealt with under (a) and (b) above. In the latter
case it is unnecessary to investigate
whether it is true or not.
Comment
77. The defence raised by the defendant that the article represented fair comment on a matter of public interest is pleaded in a "rolled up" plea. I have already stated my conclusions insofar as that plea relies on truth. On behalf of the plaintiff it was argued that there was no comment in the article at all. I do not find this to be so. The article appeared under the name of the writer who was the financial editor of the Canberra Times. Financial journalism may be expected to contain a good deal of opinion, concerned as it must be with prognostications and predictions about the future. The line between expressions of fact and expressions of opinion is notoriously difficult to draw. (See for example O'Shaughnessy v. Mirror Newspapers Limited [1970] HCA 52; (1970) 125 CLR 166). The editorial columns of a newspaper are where one would expect to find expressions of opinion of the publisher as contrasted with mere reports of the news of the day unenriched with such expressions of opinion.
78. The imputation that there was a failure to file the annual return and that WGL was the subject of an intended investigation by the Corporate Affairs Commission, are matters of fact and not of opinion. It was submitted on behalf of the defendants that the words "are to be investigated" indicated the writer's opinion about the future. The argument appears to be based on a premise that any statement about the future state of affairs must be a statement of opinion: an interesting concept which I do not need to consider as a general proposition. Mr Davis was not reporting his own opinion about what the CAC would do, but making a statement about the CAC's present intentions. The use of the phrase "planned investigation" left the reader in no doubt on that issue.
79. It is more difficult to choose the correct category in which to place the
imputation that the plaintiff endeavoured to conceal
the true financial
position of the group and that there was some connection between that failure,
the financial state of the group
and the proposed investigation. For myself,
I would have thought that these were matters of opinion and it may be that if
the text
of the article had appeared on the financial page without such
arresting headlines, the reader with a particular interest in financial
news
would have approached the article in the same way. I am not so sure about the
ordinary reader of The Canberra Times whose interest
would not have been
confined to financial matters and whose attention would have been attracted by
the headline, particularly the
headline on the front page. In any event, I do
not think that that issue needs resolution. The defence of fair comment can
succeed
only when the comment is based on a substratum of fact. Such comment
as there was in this article was predicated on the two false
premises that the
annual return had not been lodged and that there was to be an official
investigation by the CAC. At common law,
the failure to prove the truth of
any one fact upon which the comment was based meant that the defence of fair
comment could not
succeed, although there have been statements to the effect
that a substratum of substantial truth is sufficient. The cases are discussed
in Comalco; see the judgment of Neaves J. at 332. However, in my view, the
untruths that there had been a failure to lodge annual
returns and that there
was to be an official investigation are so fundamental to the comment, that
the defendant cannot rely upon
substantial truth. For the sake of
completeness, I record my finding that the subject matter of the comment was a
matter of public
interest and that if the substratum of fact had been correct,
the comment would have been fair. I have no doubt that any opinion
expressed
in the article by Mr Davis was genuinely held.
Partial justification; Polly Peck and Common Sting; Contextual Imputations
80. Evidence and argument relating to defences going under these or similar labels occupied most of the seven day hearing. The law on these matters is difficult of formulation and of application and was largely undiscovered until relatively recently. Since the introduction of s.16 of the New South Wales Defamation Act 1974 headed "Truth: Contextual Imputations" and a number of cases decided in the English Court of Appeal in the 1980's centering around Polly Peck (Holdings) Plc. and Others v. Trelford and Others (1986) 2 WLR 845, the question arises with increasing frequency in defamation proceedings (usually at an interlocutory stage) as to how far a defendant should be permitted to meet the plaintiff's claim by alleging and seeking to justify a defamatory statement about which the plaintiff does not complain. In England the matter has been complicated by the reluctance there, at least until recent years, to require a plaintiff to plead or to give particulars of the meanings relied upon, especially when the plaintiff did not rely upon an innuendo and confined the case to the natural and ordinary meanings of the words. The attitude taken traditionally was that, because the jury was the ultimate arbiter of what the words meant, then neither the plaintiff, nor indeed the defendant, should be tied too closely to meanings that were the subject of pleadings or particulars. That attitude appears to have changed during the Polly Peck era in favour of one which requires or encourages the parties to a defamation action to define the issues between them more closely. Furthermore, in England, where truth alone is a complete defence, the defendant is not allowed to plead or call evidence of truth in mitigation of damages. In the Australian Capital Territory and other jurisdictions where truth alone is not a defence, but provides a defence only when combined with the element of public benefit (in the ACT) or public interest (in some Australian jurisdictions) evidence of truth is admissible in mitigation of damages. Lastly, in the ACT and elsewhere in Australia, it appears to be a common practice to give particulars of the meanings relied upon; indeed defamation cases are often conducted as though they will be won or lost, as they sometimes are, after long and exhausting battles over particulars of meaning. What these defences have in common is an assertion by the defendant of a meaning which is wholly or partly different from that asserted by the plaintiff, which is admitted or proved to be defamatory of the plaintiff, and which the defendant claims to justify by reason of its truth (and in the ACT its publication for the public benefit). These defences are all open to abuse because they are capable of converting a modest and narrow claim by a plaintiff into a wide-ranging expansive and expensive enquiry, the limits of which are set by the defendant's capacity to pay for it. Nathan J. referred to the danger of "hijacking of the plaintiff's claim" and loss of control of the litigation, but went on to allow the defendant to plead particular meanings to raise a defence of partial justification in the case before him: Kennett v. Farmer (1988) VR 991 at 995-6.
81. Long before Polly Peck and the refinements in the New South Wales
Defamation Act 1974, Fox J. in this Court perceived the problem in Hadzel and
Another v. De Waldorf (1970) 16 FLR 174 at 179. His Honour put it in these
terms:
"In the first place, a plaintiff may not be free to82. In Jackson v. John Fairfax and Sons Ltd. and Another (1981) 1 NSWLR 36 at 39, Hunt J. described the statutory defence of contextual imputations in the following terms:
select some words only of a phrase or connected statement.
Plainly he cannot be allowed, by shedding part of the
context, to contend for a meaning that the words, in context,
do not bear. If in a connected statement, perhaps in the one
sentence, these are two distinct imputations, problems could
well arise, particularly before a jury, if the plaintiff
complained of one only. Such a case would be a charge that
the plaintiff 'is a thief and also a perjurer'. It is, one
imagines, highly unlikely that the plaintiff would rely upon
one of these imputations and abandon the other, but if he did
it would be a matter for the judge, in the light of the
attitude adopted by both parties, to ensure that the
plaintiff's complaint was adjudicated upon with justice to
both sides. It does not seem to me to follow that the
plaintiff should in effect be compelled to rely upon both
imputations and thus risk justification in relation to one."
"The defence of contextual truth accepts that the matter complained83. Subsequently, in Hepburn v. TCN Channel Nine Pty Ltd (1984) 1 NSWLR 386, Hunt J. considered a more complex situation, not unlike that in the present case, where the plaintiff relied upon several separate imputations (which the plaintiff asserted were false) and the defendant also relied on several separate imputations (which the defendant asserted were true). The question arose whether one or more of the imputations contended for by the defendant were different from those relied upon by the plaintiff, and, if so, whether the defendant could rely on them by way of partial justification or contextual imputation. Hunt J. said at 399:
of conveys the imputation pleaded by the plaintiff and that no other
defence has been established in relation to that imputation; it
asserts that the imputation pleaded by the defendant is also
conveyed by the matter complained of (such imputation being called
the contextual imputation); the defence then asserts that, even
though the plaintiff's imputation is otherwise indefensible, such is
the effect of the substantial truth of the defendant's contextual
imputation upon the plaintiff's reputation that the publication of
the imputation of which he complains did not further injure his
reputation."
"If, as I have accepted, the defendant is entitled to have the jury84. I have referred to the New South Wales cases on contextual imputations despite the absence in the ACT of a statutory provision similar to s.16 of the New South Wales Defamation Act 1974. I do so for two reasons. The first is that once it is accepted that the English rules of practice which inhibit a defendant pleading or calling evidence on the truth of the publication do not apply in the ACT, then I am unable to see any objection to a defendant raising the same matters that are permitted to be raised in New South Wales by s.16 of the New South Wales Defamation Act 1974. So long as the plaintiff's imputations and the defendant's imputations arise from the same publication, I cannot see why the defendant should not have the benefit of the imputations that are justified, at least insofar as the injury caused to the plaintiff's reputation by the unjustified imputations does not exceed that caused by the justified imputations. I am less sure whether these matters, taken together, go to the matter of a defence as to liability or whether they go to damages, and whether if they constitute a defence as to liability, it is a defence of "partial justification". Probably if it is a matter of defence, the defence is one which overlaps that of partial justification. Finally I should say that I am unable to see where the difference lies ultimately between the defence of contextual imputation in New South Wales and the principles that lie behind the Polly Peck judgment.
consider the combined effect of all of his contextual imputations in
determining whether the plaintiff's imputation to which they are
pleaded was likely further to injure the plaintiff's reputation,
there is no point in any requirement that each of the defendant's
contextual imputations individually should differ in substance from
the plaintiff's imputations to which it is pleaded - provided
however that the combined effect of the defendant's contextual
imputations do so....."
85. The other reason I make reference to the New South Wales cases at this stage is because paragraphs 8 and 9 of the defendant's further amended defence appear to have been drafted by a hand guided by a mind well aware of the extended limits set by Hunt J. in Hepburn, but careful nevertheless to remain within those limits.
86. In Silkman and Anor v. Federal Capital Press of Australia Pty. Limited (unreported, Supreme Court of the ACT, 8 December 1989) the defendants pleaded s.16 of the NSW Defamation Act 1974 only with regard to publication in New South Wales and appear not to have pleaded partial justification or the Polly Peck defences with regard to publication in the Australian Capital Territory. Gallop J. held that the defendants had not established the defence of contextual imputation under s.16 but did not have to consider whether, if the factors necessary to establish such a defence had been made out, it would have applied to publication in the Territory.
87. In TWT Limited v. Moore (unreported, Supreme Court of the ACT, 31 October 1991) Higgins J. dealt with an interlocutory application by the defendant to amend its defence to include a defence under s.16 of the NSW Defamation Act 1974 and a defence according to the Polly Peck principles. His Honour held that neither defence was available on a proper reading of the material complained of but recognized that the Polly Peck defence was acknowledged to exist at common law and applied in the ACT and that whilst the s.16 defence was "more convoluted", particularly with regard to the pleading aspects, the two defences were virtually indistinguishable.
88. I venture to say that from the cases and the principles the following
propositions may be gleaned:
1. Where the plaintiff's claim raises expressly or by implication several
distinct defamatory meanings, the defendant may seek to
justify any one of
them: see Howden v. "Truth" and "Sportsman" Limited and Another (No. 2) (1938)
38 SR (N.S.W.) 287. This is the
defence of partial justification.
2. Where the plaintiff alleges several distinct defamatory meanings but there
is arguably a "common sting" to them upon which the
plaintiff does not
expressly rely, then the defendant may seek to justify the common sting and
the plaintiff is not entitled to restrict
the defendant to seeking to justify
the several meanings selected by the plaintiff. This has been referred to as
the Polly Peck
principle: Khashoggi v. I.P.C. Magazines Ltd. and Another
(1986) 1 WLR 1412 at 1417. I call it the first Polly Peck principle.
3. Where the plaintiff alleges a defamatory meaning or several distinct
defamatory meanings but the defendant denies the meaning or
meanings alleged
by the plaintiff and asserts an arguable claim that in the context of the
whole publication a different defamatory
meaning or several different
defamatory meanings from that or those alleged by the plaintiff, the defendant
may seek to justify that
different defamatory meaning or meanings and again
the plaintiff is not entitled to restrict the defendant to seeking to justify
the meaning or meanings elected by the plaintiff. That was the effect of what
was said in Polly Peck by O'Connor L.J. (at 868-9),
Goff and Nourse L.JJ.
agreeing, and I call it the second Polly Peck principle.
4. Where the plaintiff alleges a particular defamatory meaning, the defendant
may, without denying that defamatory meaning, seek to
assert a separate and
additional defamatory meaning which is justified and the effect of which is so
serious that there can be no
further injury to the plaintiff's reputation
caused by the meaning upon which the plaintiff relies. This is what is called
in New
South Wales the defence of contextual imputation. In my view, it
applies in the Australian Capital Territory.
5. The defendant may, should, or "in a case where there are several stings,
perhaps must" (Kelly v. Special Broadcasting Service (1990)
VR 69 at 74, per
Murphy J.) plead or give particulars of any defamatory meaning which the
defendant will seek to justify, whether
or not such defamatory meaning has
been pleaded by the plaintiff. This is simply a modern rule of pleading which
enables any of
the defences abovementioned to be put properly before the
Court.
89. The defence or defences of this nature pleaded by the defendant in the
present case appear in paragraphs 8 and 9 of the further
amended defence and,
insofar as they apply to publication within the Australian Capital Territory,
are in the following terms:
"8. Insofar as and to the extent that it may be found that the90. The particulars of meanings given under paragraph 9 are identical with those given under paragraph 8 and it is unnecessary to set them out. The difference between paragraphs 8 and 9 is that paragraph 8 relies upon the natural and ordinary meaning of the words whereas paragraph 9 relies upon innuendoes arising from those sections of the Companies Act 1981 (Cth) (wrongly referred to in relation to the ACT as the Companies Code) which are set out and which it is alleged on behalf of the defendant would have been in the contemplation of the reader. It is not necessary to set out the precise provisions of those sections. Suffice to say that s.263 requires a company to lodge with the CAC an annual return in a prescribed form together with other particulars provided for and accompanied by prescribed documents. Section 240 requires a company to hold an annual general meeting within five months after the end of each financial year. Section 269 provides for the preparation of profit and loss accounts and balance sheets and, in the case of a holding company, the directors are to prepare or cause to be prepared documents dealing with the state of affairs of the company and its subsidiaries which give a true and fair view of the profit or loss and state of affairs so far as they concern members of the holding company. Section 270 requires the directors of a company to cause to be made out reports with respect to the profit or loss of the company and the state of the company's affairs, and the section provides for particulars of the statement of affairs as are required. Section 272 requires the directors of the holding company not to make out group accounts until proper accounts have been received from the subsidiaries. Lastly, sub-s.276(1) provides for penalties to be imposed on directors who do not comply with the provisions just referred to.
matter complained of was published of and concerning the plaintiff
and to be defamatory of him (which is denied) in the Australian
Capital Territory, ..... in its natural and ordinary meaning the
matter complained of meant and was understood to mean:
(a) that the plaintiff had failed to carry out his duties as
chairman of Woodger Group properly so as to ensure the Group lodged
annual returns in accordance with the law;
(b) that the plaintiff notwithstanding that he was chairman of
Woodger Group and the Group was in severe financial trouble, had
failed to ensure it lodged annual returns in accordance with the law
so that details of the full extent of its indebtedness and financial
problems were not publicly available;
(c) that the plaintiff had failed to ensure that Woodger Group had
complied with its obligations to lodge annual returns; and/or
(d) that the plaintiff had failed to comply with his legal
obligations as a director of Woodger Group in relation to the filing
of annual returns; and
(e) that the plaintiff in concert with other directors of Woodger
Group Limited procured that company to withhold financial
information from the public CAC register in order to conceal a bad
result for the previous financial year.
(f) that six months after the due date, companies owned or
controlled by the plaintiff had not lodged with the Corporate
Affairs Commission documents showing the companies' true financial
position for the year ending June 1988, and the plaintiff was a
party to that conduct.
In all or one or some of the meanings specified in sub-paragraphs
(a) to (d) (sic) above hereof the matter complained of was true in
substance and in fact. In relation to publication in the Australian
Capital Territory, it was for the public benefit that the said
matters should be published .....
9. Further or in the alternative, insofar as and to the extent that
it may be found that the matter complained of was published of and
concerning the plaintiff and to be defamatory of him (which is
denied) in the Australian Capital Territory, ..... the matter
complained of meant and was understood to mean otherwise than in its
natural and ordinary meaning by reason of the facts set out below
the meanings set out below:
FACTS:
Sections 263; 240; 269; 270; 272; 276(1) of the Companies Code."
91. The plaintiff did not file any reply to these allegations in the further amended defence. However, the case was run at the hearing as if the meanings contended for by the defendant were denied. It was not suggested that the defendant was not entitled to rely on the facts alleged to support the innuendoes alleged if the words in the article did not bear the meanings contended for in the ordinary and natural meaning.
92. Except with regard to sub-paragraph (f), I do not think that paragraphs 8 and 9 of the further amended defence raise a defence of partial justification strictly so called. They do not take one or more of the plaintiff's imputations and seek to justify it. Nor, in my view, do they raise what I have called the first Polly Peck principle, that is to say, a contention by the defendant that there was a common sting to the various imputations of the plaintiff and that that common sting was justified. Indeed they fail to meet the plaintiff's imputations in any way. What they raise rather is what I have referred to above as the second Polly Peck principle, which, as I have said, I find difficult to distinguish from the NSW defence of contextual imputation.
93. Sub-paragraph (f) of both paragraphs 8 and 9 on the other hand, takes one of the plaintiff's imputations and concedes or asserts that it was true and further asserts that it was for the public benefit that it be published. That, in my view, is a defence of at least partial justification; it becomes a full defence of contextual imputation as refined by Hunt J. in Hepburn if it strikes more seriously at the plaintiff's reputation than other imputations proved by the plaintiff or admitted, but which the defendant cannot justify. However, I have already ruled, that if sub-paragraph (f) means that no returns had been filed, it is untrue; if it means that the returns filed were misleading, it does not arise from the words published. Just as the plaintiff cannot for those reasons rely on paragraph (e) of his solicitor's particulars, so is the defendant precluded from relying on sub-paragraph (f). It simply does not raise an issue beyond those raised by paragraph (e) of the plaintiff's particulars.
94. How is it then that these defences of partial justification and contextual imputation as pleaded by the defendant relate to the claim pleaded by the plaintiff? It was submitted on behalf of the plaintiff that the imputations pleaded in paragraphs 8 and 9 of the further amended defence do not meet the plaintiff's claim because the defendant is trying to meet the "sting" of the publication and not the "foundation stone" of the false charge that the 1988 annual return was not lodged. I reject the submission. First, if there is a common sting, the defendant is entitled to justify it, whether or not it is included in the plaintiff's imputations. Secondly, if the defendant is not seeking to justify a "common sting" and there are separate imputations alleged by the plaintiff, the defendant may choose to justify not all but any one or more of those separate imputations. In this respect I think that there is a real question whether each of imputations (a), (b) and (e) of the plaintiff's particulars, which are in essence indistinguishable one from the other, contain two allegations: one that the annual return was not filed and the other that the plaintiff had concealed the true financial position. Given that the first is false, can the defendant be permitted to say that the second is true or is the second so closely bound up with the first that there is really only one imputation to the effect that the plaintiff concealed the true position by failing to file the return?
95. This gets back to the problems described by Hunt J. in Jackson and
Hepburn: so long as the plaintiff's imputation and the contextual
imputation
pleaded by the defendant arise from the same publication and there are some
differences between the two, the defendant
may rely on the defence, but
whether or not it is successful depends ultimately on how each imputation
weighs against the other in
its effect on the plaintiff's reputation. As Hunt
J. said in Jackson at 39:
"If the publication described the plaintiff (falsely)96. A trial judge sitting alone does not enjoy the luxury of delivering the inscrutable verdict of a jury. The judge must give reasons and in doing so in a case like the present may be put into the position of having to compare apples with oranges. On the face of it I would think it would do greater harm to the reputation of a company director to say that he acted so as to conceal the extent of the company's indebtedness and financial problems than to say simply that he failed to ensure that the company's annual return was filed and that there was to be an official investigation into the company. Hence, I think, that the defendant ought to be allowed to justify, if it can, the imputation that the plaintiff acted so as to conceal the true financial position of the company.
as a share swindler and (truly) as a rapist, the jury could
well have considerable difficulty in weighing or measuring
the relative worth or value of the two imputations conveyed.
In those circumstances, it seems that the trial judge would
be obliged to leave the issue to the jury."
97. The evidence on this matter and the argument about it was essentially
concerned with one fact which the defendant sought to prove:
that WGL was at
some time beteen 30 June 1988 and the date of the filing of the return on 16
April 1989 unable to pay its debts as
they fell due. That was the situation
which, according to the defendant's case, the plaintiff was concerned to
conceal. It is necessary
therefore to examine the evidence and to arrive at
some conclusions of fact upon this question, and upon the plaintiff's conduct
in relation to it.
Partial justification and similar defences, continued: the financial State of
the Woodger Companies and the plaintiff's conduct
98. It is necessary to come to some conclusion about the financial state of the Woodger companies whether at 30 June 1988 or at the time of the publication on 29 June 1989 or at some intermediate time such as 13 April 1988, the date on which the annual return was lodged. At the heart of the defence of partial justification and allied defences is the contention that the Woodger companies were at all times on the verge of insolvency, that that fact was known to the plaintiff, that the delay in lodging the annual return occurred in the light of the plaintiff's awareness of that fact and that the annual return filed disguised the true parlous state of the companies.
99. How far the Court needs to go to decide these issues is itself a matter of contention. The case was not an enquiry under the Companies Act 1981, although in many respects the defendant sought to conduct it as if it were. In my view, the precise issue whether WGL was on 30 June 1988 or any other date unable to pay its debts as they fell due, does not need to be decided: the issue arises only indirectly and only insofar as the defendant alleges as part of its defence that the plaintiff sought to prevent the true picture of the financial problems from becoming publicly available. The defence, in my view, does not cast upon the defendant an onus, nor does it cast upon the Court a duty, to recreate the financial scene as at any particular date in fine and exact detail. The broad brush will do, so long as the likeness is reasonably accurate. The defendant called no expert accounting or financial evidence. The Court is left to decide these matters on documentary material (mainly from the files of the banks) and on the plaintiff's own evidence under cross-examination.
100. The plaintiff's evidence was coloured by his inability to realise or admit that the financial position of the companies was as bleak as it clearly turned out to be by the date of the article. He blames others for the failure of his enterprises to continue to prosper in 1988 and afterwards and has always been of the view that if only the banks had been willing to continue to lend more and more and to refrain from exercising their rights to repayment, then WGL would have survived. I do not think that this attitude derives from dishonesty, but there is a thin line between it and recklessness or wilful blindness. In one transaction at least, the plaintiff crossed that line. When the plaintiff executed security documents in favour of Civic Advance Bank (CAB) for a further advance of $750,000.00 in July 1988, he did so with no intention of repaying the principal as required by those documents. But that fact alone can be of little comfort to the defendant because it is not a matter which is included in any of the imputations relied upon.
101. The financial aspects of the case involved consideration of, amongst other things, the affairs of Hire Kingdom, Scotts Electrical Pty Limited, Woodger Realty World and the proposed Belgravia float.
102. Hire Kingdom was purchased in May 1988 with a loan of $3.75m from CAB for a term of 12 months with interest-only payments to be paid monthly in arrears. It is not clear whether interest payments were up-to-date as at 30 June 1988, although it appears that Hire Kingdom itself was trading profitably with a net profit for that year of $1.465m. However, in July 1988 the CAB advanced a further $750,000.00 at the plaintiff's request to enable WGL to meet "a number of financial commitments" (exhibit 18, internal CAB memorandum of 14 December 1988). The terms of the further advance required reduction of principal by monthly payments of $75,000.00 as well as monthly payments of interest. By December 1988 WGL was two months in arrears and CAB began charging interest at a higher rate as it claimed it was entitled to do, whilst at the same time pressing for repayments of principal. By 21 February 1989, figures available to CAB showed that WGL had traded at a loss of just over $3m for the year ended 30 June 1988 and a loss of about $4m was anticipated for the current financial year. CAB kept the situation under review with obvious and understandable concern. There were suggestions from WGL that the CAB loan would be paid out in full by WGL refinancing the debt through Westpac, with or without the funds to be generated by the proposed Belgravia float. The total indebtedness to the banks at that stage (February/March 1989) was $17.2m. A sale of the Hire Kingdom business was proposed, and there was a suggestion from WGL that Hire Kingdom itself would become listed on a public stock exchange.
103. Audited financial statements for the year ended 30 June 1988 became available to CAB on or shortly before 9 March 1989. They confirmed the operating loss of $3m and showed net assets of $3.467m. The WGL assets were valued by the auditors on a "going concern" basis which assumed the continuing support of the banks. This assumption caused a senior manager in CAB to note in a memorandum of 9 March 1989 that "the balance sheet structure is unstable with a substantial deficiency in net current assets". On 22 March 1989, at a meeting of the Directors, it was decided to take legal advice with a view to "appointing an official manager to evaluate the bank's position and report back to the next meeting". On 5 April 1989, CAB advised the plaintiff that Messrs Cooper and Lybrand would be appointed to conduct an independent investigation and if that was not acceptable to the plaintiff then "the bank will forthwith proceed to exercise the power invested in it pursuant to the security". On 10 May 1989 CAB gave formal notice of the appointment of an agent on behalf of the mortgagee in possession within the terms of the mortgage of 17 May 1988.
104. In early 1989 Westpac engaged Gatfield Robinson Wareing Limited to
report on the financial position of WGL. The report was delivered
in April
1989 (the Gatfield Robinson report, Exhibit 1). On behalf of the plaintiff it
was submitted that little credence should
be given to the Gatfield Robinson
report, the chief ground being that there was no evidence as to the
qualifications or experience
of those who prepared the report. The plaintiff
said that Gatfield Robinson Wareing Limited was a firm of investment bankers
and
investment advisers. The source of his knowledge is unknown, but, in my
view, even if this were so, it would not materially affect
the weight of the
report as evidence in the case. The factual basis of the report insofar as it
is covered by other evidence is
consistent with that evidence and it is
unlikely that Westpac would have engaged advisers on financial matters who
would not, on
the face of it, be expected to be competent to so advise. The
Gatfield Robinson report relates to the financial position up until
28
February 1989. Its conclusions are summarised as follows:-
"WGL is currently under severe financial strain, to the extent that105. Under the heading "Management and Accounting", the Gatfield Robinson report concluded:-
operating income is insufficient to meet interest payments, and
there is a shortfall of assets over liabilities. This position
would appear to be the result of a series of transactions carried
out by WGL purchasing and selling businesses which created
substantial capital losses and eroded WGL's funding base. The
losses do not appear to have been created by day to day trading in
the existing businesses."
"Reporting seems reasonably accurate but tardy. Within the106. The authors of the Gatfield Robinson report come to a conclusion very similar to that reached by CAB. I do not propose to analyse the figures in detail, but a significant feature of the statement of assets and liabilities in the Gatfield Robinson report is that it gives a value of nil to the WGL holding of cumulative preference shares in a company called Park Freight. These shares were part of the consideration received for disposal of the unprofitable Fliway business. The balance sheet in the annual return that was filed on 13 April 1989 showed a book value of those shares of $4.352m. In my view, the Gatfield Robinson report is more likely to be correct in that assessment than is the annual return. The only evidence to the contrary is the expression of opinion by the plaintiff himself.
individual business entities the reporting function seems
satisfactory, except for Scotts Electrical, which had a change of
management in January 1989. Scotts reporting systems are currently
being improved."
The report continued:-
"Whilst in balance sheet terms the deficit appears to be
approximately $3 million, closer examination in the following
sections of this report suggest it may be significantly more.
Obviously the values of the various assets and thus the
financial position of the company will depend almost entirely
on the attitude of the company's creditors."
107. The Gatfield Robinson report also notes that although the value of Hire Kingdom was likely to have increased from the approximately $5m for which it was purchased "from the financially distressed seller", another distressed sale was unlikely to yield more than $6.5m, although should the business be sold in an orderly manner without urgent pressure, it was likely to achieve $9m.
108. With regard to Woodger Realty World, the Gatfield Robinson report notes, in my view correctly, that much of the success of this business depended upon the Woodger name and the connection with the Canberra Raiders. The report concluded that a fair value of the business as a going concern was $3.5m, with a slight premium possible because of the "high profile" of the company in the Canberra region based upon the matters just referred to. It was anticipated that on a liquidation the valuation of the rent rolls would be reduced and the value of the company might be reduced to between $1.5 and $2.0m.
109. The Gatfield Robinson report considered that Scotts Electrical Pty Limited would fetch $1.5m on a going concern basis, but if in receivership or liquidation, would be unlikely to produce any value at all because of the effect on contracts in progress.
110. The Gatfield Robinson report noted the other interests of the Group in land at Tweed Heads, Computer Transport Services (NZ) Limited, Sky International Pty Limited, interests in night clubs, connections with the Canberra Raiders and other matters. I do not intend to discuss these as they do not have any substantial impact one way or another. They provided net assets of some worth, but not much.
111. The Gatfield Robinson report concluded that the total owing to the banks and associated financial institutions carrying interest was $26.422m, and with an average interest rate of 19.74%, this meant that the Group had a recurrent liability for $5.216m per annum for interest. Unsecured and hire purchase liabilities were noted at $7.693m and trade creditors at $0.545m.
112. The Gatfield Robinson report also noted that the proposal to sell the
Woodger Realty World business and proceed with the Belgravia
float was "now
unlikely to proceed". The report was concerned about the position of Westpac
in relation to the other secured creditors
and advised as follows:-
"It would be in Westpac's interest to ensure that a receiver was113. Professional legal advice was recommended and the report correctly predicted that CAB was likely to appoint a receiver to the Hire Kingdom business. The report forecast a loss to Westpac in the range of $7-$8m in the event of liquidation or receivership, alternatively a loss in the region of $6.8m through sale of the Group's assets through "unofficial administration". A "financial reconstruction" of the Group through contribution of $4m of fresh capital and the forbearance of loans from Westpac and other secured lenders was considered impracticable.
appointed by it, prior to proceedings being initiated by a secured
or unsecured creditor to clearly establish the Bank's position among
WGL creditors so that it can achieve the highest level of control
possible under its security document."
114. Messrs Touche Ross, Chartered Accountants, were engaged by the Commonwealth Bank to advise on the financial position of Scotts Electrical Pty Limited (Scotts Electrical). The Commonwealth Bank held an equitable mortgage over the assets of Scotts Electrical for a loan of $1m, with a small overdraft to WGL. There was also a loan of $1.4m for purchase of Finemore shares, the security being the shares themselves. In any event, the Touche Ross report covered the affairs of WGL as well as Scotts Electrical. The Touche Ross report of 25 May 1989 was critical of the management of Scotts Electrical and notes that the main asset of the company was a debt to it owing by WGL for $1.613m. Touche Ross apparently had access to a copy of the Gatfield Robinson report and accepted its conclusions that "the Group appears to be insolvent" and that "the Group's various components will have various insolvency administrations appointed to them in the not too distant future" unless there was a reconstruction of the Group with input of fresh capital. The Touche Ross report concluded that there was a net surplus of assets over liabilities in Scotts Electrical of some $0.556m but that "this surplus will arise only if the Company's assets are able to be realised on a going concern basis, the security position would worsen considerably if the business were to be terminated and assets valued on a liquidation basis".
115. The Touche Ross Report concluded with the recommendation that an attempt be made to sell the business as a going concern.
116. On 16 January 1989 the plaintiff signed a Chairman's Report which was annexed to the WGL group accounts subsequently presented to an annual general meeting on 28 February 1989. The Chairman's Report and the accounts were part of the annual return lodged at CAC on 13 April 1989. It is unnecessary to set out the Chairman's Report. It presented what the defendant submits, in my view, correctly, was an inaccurate and misleading picture of the financial situation of WGL at the time it was signed. It was probably inaccurate as a statement of the situation at 30 June 1988 and more inaccurate as time passed. The financial situation deteriorated between then and April 1989 by which time the report was increasingly misleading. It was misleading chiefly because it failed to disclose the fact that WGL was finding it increasingly difficult to service the debts owed to the banks and that there was a likelihood that without successful financial restructuring, which was far from assured, WGL was at real risk of being put into liquidation. I reject the submission on behalf of the plaintiff that he was under no duty to disclose the financial situation beyond 30 June 1988, the end of the accounting period. He chose to sign a Chairman's Report which purported to bring the situation up to date as at the date of signing, and the report was inaccurate and misleading, as he knew or should have known.
117. Whether the company was insolvent as at 30 June 1988 is impossible to say but there must have been a distinct possibility, if not a likelihood, that if it had been placed in liquidation on that day, then its liabilities would have exceeded the value of its assets when realised. The chances were, as time passed, that it grew increasingly likely, from 30 June 1988, that if placed in liquidation the liabilities of WGL would exceed its assets and that this likelihood was known to the plaintiff at the time he signed the Chairman's Report. I do not think, however, that it has been established that at 30 June 1988 the company's liabilities exceeded its assets when valued on a going concern basis.
118. The delay in filing the annual returns was contributed to by a desire on the part of the plaintiff that by postponing presenting the accounts it would become possible to present them in a more favourable light than had been possible at the end of 1988 and in very early 1989. His hope was that by some sort of reconstruction, and particularly by the Belgravia float, the immediate future of WGL could be secured. However, I am not convinced that the failure to file the accounts by 30 December 1988 was motivated to any substantial or significant degree by a desire to disclose a deliberately false and misleading picture of the financial position of the company to either its creditors, including the banks, or to the public. When the presentation and filing of the accounts could be delayed no longer, they were incorporated into the annual return with the Chairman's Report, with the result that they presented a misleading picture. Partial justification and similar defences: Conclusions
119. I think that the defendant has established that the imputations pleaded in sub-paragraphs 8(a) to 8(d) of the further amended defence arise from the ordinary and natural meaning of the words. Accordingly the innuendoes pleaded in paragraph 9 need not be relied upon. (For what it is worth, I record my view that the innuendoes give rise to the imputations alleged if the ordinary and natural meaning does not.)
120. The imputation alleged in sub-paragraph 8(a) of the further amended defence arises from the reference in paragraph 1 of the article to the companies' "failure to lodge their 1988 results" and the other references in the article to the plaintiff. I have already discussed these matters in relation to the plaintiff's imputations. The imputations alleged in sub-paragraphs 8(c) and (d) arise for the same or similar reasons. The imputations alleged in sub-paragraph 8(b) arise from paragraphs 1, 2, 4, 5 and 6 of the article. The imputation alleged in sub-paragraph 8(e), however, is not made out in its entirety for the same reason as the plaintiff's imputation (c) is not made out: this article does not lead the reader to believe that the plaintiff connived with others or acted in concert with others in failing to file the returns or in concealing information about the financial affairs of WGL. However, the defendant's imputation 8(e) differs from the plaintiff's imputation (c) insofar as it raises an allegation of concealing a particular item, namely "a bad result for the previous financial year". I think that overall the matter of the alleged connivance may be severed from the remainder of the imputation and to that extent the defendant's imputation 8(e) does arise from the article.
121. For reasons already given and in the light of earlier findings, I further find that the defendant's imputations 8(a) to (e) are true and were published for the public benefit. But, again for reasons already given, if these justified imputations are to provide a defence, the defendant must show that the unjustified imputations on which the plaintiff relies have not further injured the plaintiff's reputation. I think that the defendant has failed to discharge the onus in this regard. On the one hand there are the false accusations by the defendant that the annual returns have not been filed and that the companies are the subject of official investigation; on the other hand there are the true accusations that the companies were at all relevant times in financial difficulties and that the plaintiff acted so as to conceal the true position and prevent disclosure to the public. It is because the article suggests that there is a connection between the financial difficulties and the concealment on the one hand and the failure to file returns and the planned investigation on the other hand, that I find it impossible to say which set of allegations is more serious than the other and impossible to judge which does the greater harm to the plaintiff's reputation.
122. That is not to say that the effect of the false allegation of the
failure to file returns and the official investigations into
the WGL affairs
is to be evaluated without reference to the surrounding circumstances which
the defendant correctly reported in the
article, in particular the
deteriorating financial situation and the hardening attitude of the banks.
The plaintiff's reputation
as a financial manager must have already slipped by
reason of what the defendant had published on 28 June 1989, which was
accurate,
and by reason of the accuracies in the article sued upon. Further,
the defendant correctly reported on 30 June 1989 that although
the returns had
in fact been lodged, they had not been lodged by the due date. That statement
was justified and, if the reader was
inclined to think that the delay (as
contrasted with the failure) to lodge the returns was connected with a
reluctance to disclose
the true financial position, the reader was quite
entitled to do so and the plaintiff not entitled to complain. The false
substratum
was removed: the suggestion of the connection between the delay
and the withholding of information about the financial state of
WGL became a
matter of fair comment on a matter of public interest. In the context of
events and of the article itself the injury
to the plaintiff's reputation
caused by the false allegation of failure to file the returns and of an
official investigation was
not likely to be great. I deal with these matters
further below on the question of damages.
Defence of illegal conduct by plaintiff
123. The defendant raised by way of defence a proposition which, if I understand it correctly, was to the effect that the plaintiff was not entitled to succeed because he had been in breach of various sections of the Companies Act 1981 which cast upon him as director various duties, such as the duty to ensure that an annual return was filed in the time limited by the Companies Act, and to ensure that the documents filed presented a true and accurate account of the financial affairs of the group.
124. Reliance was placed upon the decision of the High Court in Smith's Newspapers Limited and Another v. Becker [1932] HCA 39; (1932) 47 CLR 279. In that case the plaintiff, who was a doctor of medicine of a German university, practised medicine in South Australia after having been refused registration as a medical practitioner in that State. The defendant newspaper denounced him as a charlatan because, apart from being unregistered, he prescribed a particular drug for his patients. The drug was widely prescribed by the medical profession in Germany but disapproved of by the Medical Journal of Australia and by the defendant's newspaper.
125. Dixon J. (as he then was) considered that the defendant "had no real
defence to the inevitable action of libel". However, Dixon
J. reviewed a long
line of nineteenth Century authorities, and at 296-7 had this to say about a
defence raised, namely that the plaintiff's
failure to gain registration
entitling him to practise medicine disentitled him from suing for libel:
"It is clear that, when a publication complained of126. I do not think that the principle to which Dixon J. refers affords a defence in the present case. Indeed it did not afford a defence to Smith's Newspapers, although it did go to reduce the damages. In the present case the plaintiff, despite his failure to ensure that the annual return was lodged in time, and other failures, was not thereby disentitled or otherwise disentitled from holding office as a director. Furthermore, he does not claim any damages attributable to the loss of a benefit sought or obtained by an unlawful pursuit or transaction. The issue of whether or not he was pursuing an unlawful calling simply does not arise. The so-called defence of illegality fails. Publication outside the Australian Capital Territory
is defamatory only because it imputes unfitness for or
incompetence or unskilfulness in or conduct incompatible with
a trade, business or a vocation, the plaintiff cannot recover
if the exercise of the trade or the pursuit of the calling by
him is unlawful. It follows also that if a part of the
matter complained of is defamatory only because it reflects
upon the plaintiff in his vocation, or if the plaintiff is
engaged in any activity or transaction which otherwise would
be taken into account for the purpose of assessing damages,
then if the trade, business, vocation, activity, or
transaction is unlawful, it must be excluded from
consideration. Accordingly, in an action of slander the
plaintiff will fail if it appears that the words concern him
in an illegal trade and otherwise are not actionable without
special damage, or that the special damage consists in the
loss of some benefit sought or obtained by an unlawful
pursuit or transaction, and in an action for libel he cannot rely
upon the exercise of an unlawful calling either upon the issue of
libel or no libel or as a matter entitling him to special damage or
affecting general damages. The cases which establish these
positions are perhaps in some respects not very satisfactory, but
they are in accord with principle."
127. The statement of claim alleges publication in New South Wales, Victoria, Queensland and Western Australia in addition to publication in the Australian Capital Territory. Publication in those States is admitted. The question arises whether and how far it is necessary to consider the law in each of those States.
128. In Allsopp v. Incorporated Newsagencies Co. Pty. Ltd. (1975) 26 FLR 238
at 241, Blackburn J. (as he then was) said:
"The statement of claim alleges distribution of the offending129. Blackburn C.J. followed the same course in Comalco Ltd. v. Australian Broadcasting Corporation (1985) 64 ACTR 1 and I did the same in Smith v. John Fairfax and Sons Ltd. (1987) 86 FLR 343. Both those decisions went on appeal to the Federal Court where this approach of examining the commission of a separate tort in each jurisdiction of publication went unchallenged and uncriticised. However, when Comalco was in the Federal Court, the Full Court reduced the aggregate damages by a lump sum without determining what damages were awarded in respect of each of the separate causes of action in each of the separate jurisdictions.
material throughout Australia, and evidence was given of circulation
of the issue in question in the various States and Territories. The
plaintiff's claim is thus based not merely on the commission of a
tort within the jurisdiction, but on the commission of as many torts
as there are jurisdictions. There are several claims for several
torts, and each has to be considered separately."
130. In an unreported decision in this Court, Gutman v. Clouston and Australian Consolidated Press Ltd. (13 July 1989), Gallop J. said that it was well settled that in proceedings for defamation the common law permits the plaintiff who has pleaded a single cause of action against a newspaper defendant to recover compensatory damages for the injury to his reputation caused by the entire issue of that newspaper published by the defendant, be it within the State in which the action is brought or elsewhere. Reference was made to Toomey v. Mirror Newspapers Ltd. (1985) 1 NSWLR 173 and Waterhouse and Others v. Australian Broadcasting Corporation (unreported decision of Kelly J. in this Court, 23 June 1987).
131. In Bogusz v. Thomson and Another (1989) 95 FLR 167, counsel were content that I make one lump sum award of damages for the whole of Australia, but excluding punitive damages for New South Wales where punitive damages are not recoverable. Counsel were also content that I take the course of assuming that the applicable law of each place of publication within Australia was the same as the law of the Australian Capital Territory.
132. However, in none of the cases to date has there been any consideration of the impact of the decision of the High Court in Breavington v. Godleman and Others [1988] HCA 40; (1989) 169 CLR 41. It was touched on by Higgins J. in Baffsky v. John Fairfax and Sons Limited (unreported, Supreme Court of the ACT, 14 August 1991). In the present case the effect of that decision must be addressed.
133. The underlying principle of the judgments in Breavington, if I may state it broadly, appears to be that in an action in Australia for a tort committed in Australia the court adjudicating on the matter (the forum) should apply the law of the place of the wrong (the lex loci delicti) except for matters of procedure. Procedural matters are governed by the law of the forum (the lex fori).
134. However, the underlying principle is not to be applied automatically or
indiscriminately. Mason C.J. expressed the opinion
that the inflexible
application of the law of the place of the wrong may cause consequential
injustice in particular cases and should
not be given absolute primacy despite
the uncertainty of outcome in some situations. The Chief Justice said at
76-77:
"On the other hand the qualified or flexibleThe Chief Justice continued at 77:
application of the law of the place of the wrong copes with
the incidents of tort law in the modern age of travel when
the place of the accident may be fortuitous, as it is in the
case of an aircraft accident, and the parties may have no
substantial connexion with the law of that place or with that
place at all."
"That alternative involves the application of the lex135. Mason C.J. considered that the case for regarding the lex loci delicti as governing law might be stronger in an action brought for an interstate tort than in an action brought for a tort committed overseas. Mason C.J. considered that in the factual circumstances of Breavington, there was no reason for the trial court in Victoria to depart from the application of the law of the Northern Territory where the plaintiff had been injured. That was because there was substantial connection between the Northern Territory law, the parties and the occurrence.
loci delicti subject to an exception involving the
application of the law of the country with which the
occurrence and the parties had, at the time of the
occurrence, the closest and most real connexion."
136. In McKain v. R.W. Miller and Co (South Australia) Pty Ltd [1991] HCA 56; (1991) 104 ALR
257, the High Court affirmed the decision in Breavington and restated the
principles, although it was not in dispute
that the action brought in New
South Wales should be determined according to the substantive law of South
Australia where the plaintiff
had received injury. The joint judgment of
Brennan J., Dawson J., Toohey J. and McHugh J. at 276 repeated the formulation
of the
common law rule applicable in Australia in the terms in which it had
been put by Brennan J. in Breavington at 110:
"A plaintiff may sue in the forum to enforce aforum if -
liability in respect of a wrong occurring outside the territory of the
1. the claim arises out of circumstances of such acause of action would have arisen entitling the plaintiff to enforce against the defendant a civil liability of the kind which the plaintiff claims to enforce; and
character that, if they had occurred within the territory of the forum, a
2. by the law of the place in which the wrong occurred, thewhich the plaintiff claims to enforce."
circumstances of the occurrence gave rise to a civil liability of the kind
137. However, the joint judgment also recognized the views expressed in Breavington that the "underlying rule" which applied the lex loci delicti had "some degree of flexibility" where the parties had no substantial connection with the lex loci delicti (at 275) or in special circumstances "where the lex loci delicti has no real connexion with the proceedings" (at 276). Mason C.J. repeated the views his Honour had expressed in Breavington and observed at 258 that in that case the lex loci delicti was applied as "the law of the place having the closest connection with the parties and the cause of action". Deane J. said at 281 that conflict or competition between the tort laws of the different States and Territories of Australia should be resolved in favour of the substantive law of the locus "at least prima facie".
138. As Kelly J. pointed out in Waterhouse (R.W.) v. Australian Broadcasting Corporation (1989) 86 ACTR 1 at 19, the question of "multiple simultaneous torts" was not dealt with by the High Court in Breavington. In such cases, and the present is one of them, there may be several loci delicti occurring in several legal systeMs The lex fori may or may not coincide with the lex loci delicti in some places and clash with the lex loci delicti in others. There seems to me to be strong ground for considering that in such a case there should be less hesitation than in cases such as Breavington about applying the law of the forum to the whole of the commission of the tort in Australia, even though the lex loci delicti in some part or parts of Australia where publication has occurred may afford a defence which is not available in the lex fori. Higgins J. took a similar view in Baffsky with regard to the defence of qualified privilege, although his Honour considered that there was no difference "in any substantive way" in the availability of that defence in the several jurisdictions where publication had taken place. The freedom to publish within and throughout Australia ought not be inhibited by a fear of liability for defamation in a part of Australia with which the publication does not have substantial connection.
139. This is not to recognize that a plaintiff may go forum shopping. It may be that a plaintiff claiming to be defamed by an interstate publication will choose to sue in a State or Territory in which there was very limited distribution of the publication concerned and where the substantial connection of the case is with another State or Territory in which there has been widespread publication. In such a case, the court in which the plaintiff originally sued might have little difficulty in declining to apply the exception and in insisting on applying the lex loci delicti. Where the tests laid down by the cross-vesting legislation were met, consideration could be given to transferring the matter or part of it to the Supreme Court of the place where the lex loci delicti and the lex fori would coincide.
140. In the present case it seems to me that the substantial connection of
the publication of the Canberra Times on 29 July 1989
was with the Australian
Capital Territory and to a lesser extent with the Queanbeyan area of New South
Wales. There has not been
shown any substantial connection with the other
States in which there was very limited publication. The plaintiff lived in
Canberra
and had his business interests centered here. The financial
interests of WGL included interests in Canberra institutions or Canberra
branches of such institutions. Some of the subsidiary interests of WGL were
outside the Australian Capital Territory. The Canberra
Times is well known as
the only daily newspaper published in the ACT and as having, for the ACT
itself, a very substantial readership.
There is no other newspaper as closely
concerned with ACT issues. The article complained of was essentially about
ACT matters.
The case was a Canberra case. It seems to me quite artificial
to divide up the plaintiff's right to recover damages for the defendant's
publication into what he was entitled to recover for the publication in
Canberra according to the law of the Australian Capital Territory
and what he
was entitled to recover for the publication across the border in the
neighbouring areas of New South Wales according
to the law of that State, let
alone the minimal damage sustained as a result of publication elsewhere in
Australia. I think that
the exception to the general rule as enunciated by
Mason C.J. should apply and that this Court should apply the law of the
Australian
Capital Territory to the whole of the publication in Australia. I
am unable to see how any injustice would result to either the
plaintiff or the
defendant by applying the law of the Australian Capital Territory to the case
in hand.
Damages
141. Damages have to represent a vindication to the plaintiff, which in some cases may go beyond mere compensation for the value of loss of reputation. In addition, the plaintiff is entitled to be compensated by way of a sum which will console him for the hurt to his feelings brought about by what he sees as his loss of reputation.
142. The plaintiff in the present case gave convincing evidence about the subjective hurt caused to him by the false allegations that the company controlled by him had failed to file its annual return and was about to be placed under official investigation, when that allegation was made at a time of critical importance in the company's financial affairs. He explained, and I accept, that the hurt to him was the greater because he had not been consulted on behalf of the defendant about that failure, even though there had been frequent contact between him and Mr Davis over a period of time prior to the publication.
143. The plaintiff also complained of what he saw as a lack of apology. The
defendant asserted that there was apology or at least
something in the nature
of an apology on the following day in an article bearing the heading "Banks
hold Woodger key". The article
commenced as follows:
"Woodger Group's 1988 financial returns were placed144. In my view, neither this nor anything else in the article was an apology and the defendant is not entitled to have it treated as such. The rest of the article which it is not necessary to set out was self-justifying. It quoted at length from the 1988 annual return and emphasised the continuing financial difficulties of WGL. On the other hand, although not an apology, it was a retraction, a limited retraction, of what had been the gist of the libel published the previous day. The retraction was not given prominence and was not likely to be read by all those who had been attracted to the article commencing on the front page with its arresting headline. Nevertheless, the article of 30 June 1989 went some distance both to reduce the defamatory effect of the publication and to assuage the hurt to the plaintiff which flowed from the libel. I reject the submission on behalf of the plaintiff that publishing the article of 30 June 1989 was "even worse than publishing nothing".
on the Corporate Affairs Commission file for the company
yesterday after The Canberra Times reported that the company
was under investigation for having failed to lodge its
financial return.
This followed a report the previous day that
Woodgers, a major Canberra and Queanbeyan company with
interests in real estate, property development, equipment
hire, electrical goods and freight forwarding, was in severe
financial troubles and was negotiating with its bankers and
an investor who was proposing to inject $4.5 million in new
equity into the company in order to save it from collapse.
Yesterday the acting commissioner of the Corporate
Affairs Commission, John Pinkerton, said in a statement that
the return had been lodged in April. The company was not
under investigation.
On Wednesday CAC staff had checked computer records
and told The Canberra Times the return had not been lodged.
A CAC investigator said there would be an investigation into
why it had not been lodged, as reported."
145. Although I am quite convinced that the plaintiff was genuine in his expression of injury in his evidence and in his assigning blame to the defendant for the continuing deterioration of the financial position of the companies which ended in their receivership, I do not think that the plaintiff's subjective feelings and opinions are an end of the matter. There can be no doubt that the serious financial position of the companies as at the date of publication was an established fact. The evidence does not convince me that the publication caused any creditor to take any step to the prejudice of the company which would not have been taken even if the publication had not occurred. No evidence was called by the plaintiff from any witness to suggest that any particular person had thought the less of the plaintiff by reason of reading the article. Nevertheless I think it should be concluded as a matter of probability that there were persons in the Canberra area and in the adjacent areas of New South Wales who thought the less of the plaintiff because of the reported failure to file returns, the report of the planned investigation by the Corporate Affairs Commission and the association of those matters with the concealment of financial difficulties of WGL. There was no evidence of the plaintiff's reputation in other parts of New South Wales, nor in Queensland, Victoria, and Western Australia, and I conclude that any harm to his reputation in those places was very slight and indeed in Western Australia minimal.
146. The publication figures as disclosed by the defendant and accepted by
the plaintiff are as follows:
ACT 35,754147. In counsel's written submissions for the defendant, it was submitted that "the article was but a drop in the ocean of catastrophe in which the plaintiff and Woodger Group were then drowning" and that the plaintiff was using the article and the Canberra Times as a scapegoat and small solatium for his business failure. The submission is couched in extravagant terms and to that extent I reject it, but it does have a point. The plaintiff was not entitled to blame the defendant for the ultimate financial failure and to the extent that his feelings were wounded by resentment of that nature, he is not entitled to damages.
New South Wales 3,870
Victoria 125
Queensland 27
Western Australia 5
148. There was a claim for aggravated compensatory damages. To this extent it was necessary for the plaintiff to rely upon some conduct of the defendant which went to aggravate the injury suffered by the plaintiff and increase the harm done to him. I have already dealt with the question of the alleged failure to apologise. In this respect the plaintiff is entitled to some very slight aggravation of his damages for the reasons I have already mentioned. In relation to the plaintiff's complaint that he felt the worse because no inquiry had been made of him by Mr Davis, the fact was that Mr Davis had made efforts to contact him on the night before the publication and they were, in my view, reasonable efforts culminating in a telephone call to the plaintiff's home at about 6 p.m. Mr Davis left a message with a woman who answered the phone to the effect that he wanted to contact the plaintiff. The plaintiff never said, and was not asked by either counsel, anything about whether he received a message or not. In the absence of evidence I think I would have to presume that he did receive the message, but even if he did not, that was not the fault of Mr Davis.
149. The plaintiff also relied upon the behaviour of the defendant in the conduct of the case both before and during the hearing. Allegations of impropriety were made in the correspondence, during the cross-examination of the plaintiff and the presentation of and commentary on voluminous documentary evidence relating to the financial affairs of the companies. I do not think that those allegations should go to aggravate the plaintiff's damages. As I have said, there is a thin line between dishonesty, recklessness and wilful blindness and the allegations were reasonably incidental to some of the matters legitimately raised by way of defence. In particular, however, these allegations were most closely associated with the defences of substantial truth, partial justification and contextual imputation. All those defences failed, despite the great amount of time that was taken up with matters which may have been relevant to them. The defendant did however succeed in showing that the damage to the plaintiff's reputation caused by the article has to be seen in the light of the deteriorating financial position of WGL, the insistence of the banks that WGL meet its financial obligations and the retraction, such as it was, in the article published on 30 June 1989. In those circumstances it is not appropriate to award aggravated damages.
150. The award of damages for both loss of reputation and for hurt to feelings must be quite modest. In my view, a sum of $12,000 is appropriate for damage to reputation and $3,000 for injury to feelings.
151. I have considered whether it might be appropriate to award the plaintiff costs that go beyond the ordinary party and party level. Because of the defendant's reliance on the unsuccessful defence of partial justification and similar defences, the case took much longer than it should have and the factual issues were made far too complex.
152. Unless the parties wish to be heard further, I propose to order that the defendant pay the plaintiff's costs on the full Supreme Court scale. I do this not because of any rule that actions for defamation should ordinarily be brought in the Supreme Court. I do it primarily because the issues raised by the defendant made the case a difficult and complicated one and it is appropriate that in those circumstances the plaintiff should be able to recover from the defendant more than what would ordinarily be awarded on a judgment of $15,000. However, I do not consider it appropriate in this particular case to go beyond that and order the defendant to pay costs on an indemnity or solicitor and client basis. This case ought, however, to stand as a reminder of the Court's power to award such costs in appropriate cases.
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