Arthur Marshall Hoyle v Federal Capital Press of Australia Pty Ltd [1992] ACTSC 5 (28 January 1992)

SUPREME COURT OF THE ACT

ARTHUR MARSHALL HOYLE v. FEDERAL CAPITAL PRESS OF AUSTRALIA PTY. LTD.
S.C. No. 668 of 1990
Practice and Procedure

COURT

IN THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Master A. Hogan(1)

CATCHWORDS

Practice and Procedure - Pleading - Defamation - Imputations - Particularity - Whether Capable of Arising -

Bik v Mirror Newspapers (1979) 2 NSWLR 679 at 681

Baffsky v John Fairfax Sons Ltd (Supreme Court of the ACT, Higgins J., 14 August 1991, unreported)

John Fairfax and Sons Ltd v Foord (1988) 12 NSWLR 706 at 726.

Lewis and Daily Telegraph (1964) AC 234

Drummoyne Municipal Council v ABC (1990) 21 NSWLR 135

HEARING

CANBERRA
28:1:1992

ORDER

The imputations listed as 1(c), 2(c), 3(c), 4(c), 5(a), 5(b), 5(c), 6(a), 6(b) and 6(c) in the letter dated 23 May 1991 from Colquhoun Murphy to MacPhillamy Cummins and Gibson be struck out.

The Plaintiff pay the Defendant's costs of and incidental to the application.

DECISION

This is an application to strike out certain imputations relied upon by the plaintiff in an action for defamation. The Writ was issued on 31 October 1990, and the claim endorsed upon it was as follows:
"The plaintiff's claim is for damages for defamation arising from

the publication by the defendant throughout the Australian
Capital Territory and New South Wales, on or about Thursday 25
October 1990 in the newspaper, "The Canberra Times" of an article
entitled "Raceway Riddle: $75,000 Missing", which made defamatory
imputations against the plaintiff regarding the alleged
disappearance of $75,000 of public money, and in relation to
other matters arising out of an ACT Supreme Court action."

2. The Statement of Claim which was delivered on 20 December 1990 simply alleged the publication in much the same terms as that endorsement, and attached a copy of the article as schedule A to the Statement of Claim. It did not set out any imputations.

3. The imputations relied upon were supplied by way of Further and Better Particulars in a letter dated 23 May 1991 from the solicitors for the plaintiff to the solicitors for the defendant. There are six subject matters dealt with by those imputations, and in respect of each subject matter, three separate imputations are alleged.

4. The defence was delivered on 2 July 1991, admitting the publication of the matter complained of. It puts in issue that the publication concerned the plaintiff, that it was defamatory in its natural and ordinary meaning and that in its natural and ordinary meaning it was, or was understood to be, or is capable of being, defamatory of the plaintiff. Further defences were pleaded of qualified privilege, arising under the common law, or based upon statute so far as concerned the publication in New South Wales. Those defences are not relevant to this application, except in the extent to which an attempt to justify, at the trial, an imputation which could not arise would unduly complicate and impede the trial and increase costs.

5. It will be seen that there are effectively 18 separate imputations relied upon by the plaintiff. It was contended on behalf of the defendant that all 18 should be struck out. In respect of the first five sets of imputations, there is a common pattern, as a result of which it may not be necessary to deal with all 18 separately in any great detail.

6. In the letter supplying particulars the plaintiff stated that the whole of the matter complained of was relied upon as giving rise to each imputation, but certain parts of the matter complained of were pointed to particularly in respect of each group of imputations. Those parts were identified by reference to a copy of the matter complained of, with each paragraph assigned a number. A similar copy of the matter complained of is reproduced as an annexure to these reasons.

7. This is not an application to strike out the whole statement of claim. The defendant contends that each of the imputations relied on is not capable of arising out of the published matter. Even if that contention succeeds completely it will not finally dispose of the action. The plaintiff will be able to supply other particulars. The defendant's success in this application would not have the effect of depriving the plaintiff of his day in Court.

8. Nevertheless, I think that I should not strike out any of the imputations unless it is clear that the published material could not possibly bear the imputation alleged.

9. I also think that the approach to that question should be the same as that used to determine whether an article was capable of defaming a plaintiff, as set out in Bik v Mirror Newspapers (1979) 2 NSWLR 679 at 681.

"To ascertain the correct test, it is unnecessary to travel
beyond the decision of the House of Lords in Lewis v Daily
Telegraph Ltd (12). The question is what the words would convey
to the ordinary man; it is not one of construction in the legal
sense. The ordinary man, as Lord Reid observed (13), can and
does read between the lines in the light of his general knowledge
and experience of worldly affairs. What he would infer has
generally been called the natural and ordinary meaning of the
words. This has two elements, one the direct meaning, the other
what the ordinary man will infer from them, for that is part of
their natural and ordinary meaning. For this purpose, what he
would infer is included as part of the natural and ordinary meaning.
Whether the words are capable of having a defamatory meaning at all
is a question for the Judge. But, as it is difficult to draw the
line between pure construction by a judge as a lawyer and
implication drawn by an ordinary reader, there must be added to the
implications which a court is prepared to make as a matter of
construction all such insinuations and innuendoes as could
reasonably be read into them by the ordinary man: per Lord Devlin (14).
With these tests in mind, I turn to the words declared upon.
What could an ordinary man infer from a fair reading of the
article read as a whole? How could an ordinary reader construe
the matter published? This is another way of asking whether a
jury, properly instructed, could reasonably come to the view that
the words were defamatory of the plaintiff."

10. I bear in mind that is not my function to assume the role of the trial Judge, by deciding whether the matter does or does not in fact give rise to the particular imputation. The plaintiff is entitled to frame his case as he pleases, subject to the right of the defendant to have the issues defined with sufficient particularity to enable a fair trial.

11. Considerations relevant to that requirement of justice were summarised by Higgins J. in Baffsky v John Fairfax Sons Ltd (Supreme Court of the ACT, Higgins J., 14 August 1991, unreported) as follows:

"I now turn to the imputations pleaded. They are each alleged to
depend for their defamatory "sting" on the natural and ordinary
meaning of the words used in the matter complained of. In every
jurisdiction other than New South Wales, those meanings are
merely particulars (see Uren v Australian Consolidated Press Ltd
(1964) NSWR 272; Packer v Mirror Newspapers (1968) 3 NSWR 436;
Ron Hodgson v Belvedere Motors (1971) 1 NSWLR 472; Turner v
Bulletin Newspaper Co Pty. Ltd [1974] HCA 25; (1974) 131 CLR 69).
That differentiation, however, quite properly makes little
difference in pleading. It is desirable that imputations alleged
by a plaintiff appear in a pleading, particularly where the
matter complained of is extensive. It is also reasonable to
demand of such imputations a degree of precision and accuracy
similar to that demanded by the Rules and practice in New South
Wales (see Monte v Mirror Newspapers Ltd (1979) 2 NSWLR 663;
Jackson v John Fairfax and Sons Ltd (1981) 1 NSWLR 36;
Mayfield-Smith v Mirror Newspapers (1982) 2 NSWLR 419; Hepburn v
TCN Channel 9 Ltd (1984) 1 NSWLR 386; Morris v Newcastle Newspapers
Pty Ltd (1985) 1 NSWLR 260; Whelan v John Fairfax and Sons Ltd
(1988) 12 NSWLR 148; Council of the Municipality of Drummoyne v ABC
(NSWCA; Gleeson C.J., Kirby P, Priestly J.A.; 7/12/90; unreported)).
However, I observe that there is a greater need for precision
where the purpose is to ensure that each side knows what case is
to be met at trial. It is different where there is no complaint
of surprise or misunderstanding before trial but a complaint of
imprecision is made at the hearing. The real purpose of the
specification of the cause of action is to ensure that the matter
really at issue is fairly tried and determined. It is as much
the defendant's responsibility as it is the plaintiff's to ensure
that pleadings are, before trial, properly adapted to that end.
It may be, of course, that a particularised imputation cannot be
sustained because it is extravagantly or imprecisely pleaded.
There may be other cases where the imputation describes several
possible defamatory meanings but the defendant has failed to ask
the plaintiff to specify the particular meaning the plaintiff
will seek to establish as being conveyed by the matter complained
of. To leave such a complaint until final address is to invite
the response that the defendant either well understood the
particular meaning being contended for by the plaintiff or was
prepared to accept the imprecision and meet the various possible
meanings allegedly imputed by the matter complained of."

12. I do not understand His Honour to be there saying that I am entitled, at an interlocutory stage, to strike out an imputation simply because it appears to me to be imprecise. Whether or not it is so imprecise as to be unsustainable will be a question for the Judge at the trial. But if it is clear that it could not possibly arise, or it is so imprecise as to be embarrassing, that is, as to impede the fair trial of the action, then I should strike it out.

13. The first set of imputations relates to a sum of $75,000 of public moneys said to be missing. The paragraphs of the matter complained of that are particularly relied upon by the plaintiff are those numbered 1, 2, 11, 13, 14, 18 and 23.

14. In support of the contention that the article must be read as a whole, the defendant contends that the following paragraphs should be taken into account, as having an effect upon the meaning of the matter published, namely those numbered 3, 16, 17, 19, 23, 24, 25, 26, 27 and 28.

15. The imputations relied on are

"1 (a) That the plaintiff is responsible for the fact that more
than $75,000 of public money intended for ACT racetrack projects
is missing.
1 (b) That the plaintiff by his lack of due care is
responsible for the fact that more than $75,000 of public money
intended for ACT racetrack projects is missing.
1 (c) That there are reasonable grounds for suspecting that
the answer to the riddle of the missing $75,000 of public money
intended for ACT racetrack projects is that the plaintiff has
been dishonest."

16. With respect to the whole set of three, the defendant contends that on a fair reading of the material it could not be read to mean (a) that money was missing, or (b) that the plaintiff was responsible for whatever happened to it.

17. I think it is clearly open for a tribunal of fact to find an imputation that the money was missing. The headline in 1 and the bare statement in 2 are sufficient. Whether what follows is sufficient antidote for that ingredient of the bane will be for the Judge to decide.

18. Similarly, I think that the photograph at 11 and the statements in paragraphs 14, 15, 16, 17 and 18 could possibly support the inference that the plaintiff was somehow connected with the fact that the money was missing.

19. Next, the defendant relies upon the lack of precision in the word "responsible" as used in 1(a). I acknowledge the need for precision and the reasons for insisting on it, and am aware that it is not a word used by the defendant, as was the word "corrupt" discussed in John Fairfax and Sons Ltd v Foord (1988) 12 NSWLR 706 at 726. I respectfully follow what was said by Gleeson C.J. in Drummoyne Municipal Council v ABC (1990) 21 NSWLR 135 at 138,

"As I have indicated, the question is ordinarily one to be
resolved by considerations of practical justice in the
circumstances of a particular case, rather than considerations of
the possibility of linguistic refinement. I agree with the test
formulated by Hunt J. in Whelan v John Fairfax and Sons Ltd (1988)
12 NSWLR 148 at 155 where His Honour said:
'...The issue which has to be decided in the particular case is
whether there is likely to be confusion either at the pleading
stage or at the trial in relation to the meaning for which the
plaintiff contends.'"

20. I am not persuaded that the concept of "responsibility" is so vague as to impede the fair trial of the action by causing any confusion, either at this, the pleading stage, or at the trial.

21. Imputation 1(b) adds an element of precision, by attributing to the plaintiff lack of due care. Again, whether that meaning does arise is a matter for the trial. I am not prepared to hold that it could not possibly arise.

22. Imputation 1(c) is more complex. It is not put that the defendant imputed that the reason for the fact that the money was missing was the plaintiff's dishonesty, but only that it was implied that there were reasonable grounds for entertaining that suspicion.

23. In this case I do not think the distinction makes any difference. Doing the best I can to come out of my ivory tower, and putting aside my exiguous learning on the rules of construction, reading and rereading between the lines as imaginatively as I am able, cup of coffee in hand (cf Lewis v Daily Telegraph (1964) AC 234, quoting Salmon J. at 241, and per Lord Reid at 258,) I am unable to discern the slightest suggestion of dishonesty, or even the merest hint at the existence of reasonable grounds for suspecting it, in or between the lines of the published material. Mismanagement and muddle by someone is patently alleged. Whether it was alleged to have been by the plaintiff is a question for the trial.

24. But nowhere is there any imputation remotely suggested of grounds, reasonable or otherwise, for suspecting dishonesty by anyone, plaintiff or other.

25. On rereading the material that conclusion is so clear to me that I am satisfied that the imputation 1(c) could not possibly be sustained, and that to allow it to remain would be embarrassing, particularly because attempts to justify it, as adumbrated by the defence, would raise issues that are not material, and would impede the proper conduct of the trial. I therefore order it to be struck out.

26. The second set of imputations are

"2 (a) That the plaintiff is responsible for the fact that public
money has paid for a substandard racetrack.
2 (b) That the plaintiff by his lack of due care is
responsible for the fact that public money has paid for a
substandard racetrack.
2 (c) That there are reasonable grounds for suspecting that
the plaintiff by his dishonesty is responsible for the fact that
public money has paid for a substandard racetrack."

27. The particular paragraphs that the plaintiff points to as supporting the imputation are 1, 2, 3, 7, 11, 13, 14, 18, 23, 24, 26, 27 and 28.

28. The elements of "public money" and "paid for a substandard racetrack" are explicit in paragraphs 2 and 3.

29. The connection between those elements and the plaintiff is much more tenuous. Its force is greatly diminished by the Judge's finding reported in para. 28. But in the light of the contents of paras 7, 11, 14, 18, 23 and 28 I think that its existence is a question to be decided at the trial.

30. I would therefore make no order in respect of imputations 2(a) and 2(b). But for the same reasons as set out when dealing with 1(c) I order 2(c) to be struck out.

31. The third set of imputations are

"3 (a) That the plaintiff is responsible for the fact that the
proceeds of a motor show, paid for by public money, are missing.
3 (b) That the plaintiff by his lack of due care is
responsible for the fact that the proceeds of a motor show, paid
for by public money, are missing.
3 (c) That there are reasonable grounds for suspecting that
the plaintiff by his dishonesty is responsible for the fact that
the proceeds of a motor show, paid for by public money, are missing."

32. Again, it is my view that, for the reasons stated, 3(c) must be struck out.

33. The paragraphs relied on by the plaintiff are 1, 2, 3, 11, 13, 14, 15, 16, 17, 18 and 23. The defendant pointed to para 24. Paragraph 3 would alone suffice for the elements "proceeds of a motor show", "paid for by public money" and "missing".

34. But the same considerations as operated in the previous set concerning the connection with the plaintiff lead me to the conclusion that I should not make any order in respect of 3(a) or 3(b).

35. The fourth set of imputations is

"4 (a) That the plaintiff is responsible for the fact that $8,000
is missing from the building society account of the Canberra
Automobile Racing Association ("CARA"),
4 (b) That the plaintiff by his lack of due care is
responsible for the fact that $8,000 is missing from the building
society account of the Canberra Automobile Racing Association
("CARA").
4 (c) That there are reasonable grounds for suspecting that
the plaintiff by his dishonesty is responsible for the fact that
$8,000 is missing from the building society account of the
Canberra Automobile Racing Association ("CARA")."

36. The paragraphs relied on by the plaintiff are 1, 2, 3, 11, 13, 14, 16, 17 and 18. The defendant points to para 24.

37. I do not expect that the ordinary reader would trouble to attempt an audit of the various sums of money mentioned in the article. The contents of para 16 alone are capable of supporting the imputation alleged. The connection with the plaintiff is at least possible for the reasons set out above.

38. I make no order about 4(a) or 4(b), but order 4(c) to be struck out.

39. The fifth set of imputations is

"5 (a) That the plaintiff as a former CARA President is responsible for
the fact that a condition of approval by the Community
Development Fund (that CARA would match a grant by the Fund from
sponsorships from driver training and other organisations) was
breached because sponsorships did not eventuate.
5 (b) That the plaintiff as a former CARA President by his lack of due
care is responsible for the fact that a condition of approval by
the Community Development Fund (that CARA would match a grant by
the Fund from sponsorships from driver training and other
organisations) was breached because sponsorships did not eventuate.
5 (c) That there are reasonable grounds for suspecting that
the plaintiff as a former CARA President agreed to a condition of
approval by the Community Development Fund (that CARA would match
a grant by the Fund from sponsorships from driver training and
other organisations) knowing at the time of the agreement that
this condition would be breached.

40. The paragraphs relied on by the plaintiff are 1, 2, 3, 11, 18, 19, 20, 21 and 22.

41. The defendant says that they must be read together with paras. 2, 12, 13, 14, 15 and 24.

42. That the plaintiff was a former CARA president appears from para 18. The conditions of approval by the Community Development Fund appears from para 19, and the source perhaps from para 20. Paras 20 and 21 appear to be contradictory, but let it be conceded that the overall impression is left that the failure of the sponsorship to eventuate caused the breach of the condition. There is still nothing on the article, or in any combination of selected paragraphs, that to my mind is capable of supporting the imputation that the plaintiff was responsible for the failure of sponsorships to eventuate. There is even less to suggest either that it was he who on behalf of the Club agreed to the condition, or what his state of mind was at the time, whenever that might have been.

43. I order imputations 5(a), 5(b), and 5(c) to be struck out.

44. The sixth set of imputations is

"That the plaintiff approached Murray Northrop to design and
supervise construction of a bitumen racetrack at Fairbairn Park,
and was responsible for approving the laying of hotmix on an
inappropriate base, and for these reasons was responsible for:
(a) CARA's racetrack being substandard
(b) CARA wrongfully causing injury to NOMAD
(c) CARA being sued in respect of the racetrack with a result
accurately summarised by saying CARA was found liable to pay
$106,000.00 in damages and costs of about $50,000.00.
We note that each of imputations 6(a), 6(b) and 6(c) is a
distinct imputation.

45. The paragraphs relied on by the plaintiff are 1, 2, 3, 4, 5, 6, 7, 8, 11, 18, 23, 24, 25, 26, 27 and 28.

46. That the plaintiff approached Murray Northrop to design and supervise construction is explicit in para 23. The laying of the hotmix on an inappropriate base may be thought to have led to each of the results listed at (a) (b) and (c). The claim by Murray Northrop that it had sought approval before going ahead, set out in para 28, may impute a connection between those disastrous results and someone at the Club.

47. But Mr Hoyle, in para 18, is said only to have been a former club president, and to have been empowered to sign cheques on behalf of the club and CIRM. The organisation of which he is said to be executive director is CIRM, not the Club. CIRM wanted the disputed track ripped up, and that decision or desire may fairly be attributable to the plaintiff. But the photograph, the former presidency, and the authority to sign cheques does not support an inference, or lead to an imputation in the mind of the most suspicious ordinary reader, that it was the plaintiff who gave approval to go ahead to Murray Northrop, if that approval in fact were given. There were other criticisms made of the term "wrongfully" used in 6(b), and of the causal connection between the reasons stated and the result in 6(c), but I do not need to decide them. I am convinced that none of the imputations set out in 6 could possibly arise, and I order them struck out.

48. In the result the defendant has substantially succeeded on this application, and I order the plaintiff to pay the defendant's costs of and incidental to the application.

SCHEDULE
1. RACEWAY RIDDLE: $75,000 MISSING
by Jodie Brough
2. More than $75,000 of public money has disappeared into ACT
racetrack projects, a court case has revealed.
3. The ACT Supreme Court case has shown that since 1986
public money in grants and sponsorship has paid for a track
described as "substandard", and for a motor show, the proceeds of
which have evaporated.
4. The case involved a local company, Nomad Constructions,
which sued Canberra Automobile Racing Association for non-payment
of bills for the construction of a racetrack on their block at
Fairbairn Park motor racing complex in 1986.
5. The same track is half of the proposed Canberra International
Raceway, the plans for which are before the ACT Government. The
other half is the former police driver training track.
6. The proponents, Canberra International Raceway Management,
want the disputed track ripped up to make way for the
international track.
7. The CARA club counter-claimed that the track was not
suitable for the purposes for which it had been built, and sought
damages from Nomad. The engineers, Murray Northrop Pty Ltd, and
the club each launched suits against the other.
8. The fall-out of the case is being worked out this month.
It stems from a judgment brought down by Justice John Kelly on
June 29. Nomad was awarded more than $106,000 in damages, as
well as court costs estimated at about $50,000.
9. The debt has not been paid.
10. Club President John Ribiero told the Canberra Times that
once the International Raceway was built the club would have
guaranteed usage of the track and would use the proceeds of race
meetings to pay the court-ordered debt.
11. (A photograph captioned "Arthur Hoyle" - 5cm x 6.4cm
appears in the text at this point.)
12. At a hearing on October 15 to determine the assets of
CARA, Mr Ribiero and club representative Edmund Roberts told the
court the club had no money, but wanted to pay the debt although
it was an incorporated body and its officers were not liable. It
has paid about $5,000 in legal fees, and owed a further $30,000
while club members were owed $25,000 in debentures, which had
been issued at interest of 17 per cent to fund construction.
13. A garnishee order on the club's building society account, in
place since an initial $6,700 in court costs was awarded to
Nomad a year ago, had yielded about $400. The club said a
$60,000 deposit in its account belonged to Canberra
International Raceway Management, the incorporated association
which has proposed the $3.2 million Canberra International
Raceway at Sutton Park.
14. The club and the association had been using a joint bank
account.
15. Money raised by the association from holding the Canberra
Motor Show at the National Convention Centre in June had been
placed in the account.
16. Calculations by solicitors for Nomad found that about
$8,000 should still be in the common account. Mr Ribiero and Mr
Roberts said that while the calculations seemed correct, they did
not think they had that much money in the account.
17. They said that $30,000, which had been given to the
association in sponsorship by the ACT Department of Health, on
the condition that all advertising contained anti-drink-driving
slogans, had been paid to the National Convention Centre. They
said they were "disorganised" and did not know where the rest of
the money had gone.
18. A former club president, Arthur Hoyle, now executive
director of CIRM, was one of only two people empowered to sign
cheques on behalf of both organisations. The other person able
to sign cheques for both organisations was Mr Roberts. Mr
Ribiero was not able to sign cheques for either his club or CIRM.
19. The track was built in part from $45,000 paid to the club
from the Community Development Fund. Funding was approved on the
condition that the club matched the grant in money or materials.
20. The club is understood to have met the conditions through
gaining sponsorship from driver-training and other organisations,
and through the debentures issued.
21. This sponsorship did not eventuate.
22. A spokesman for ACT Sport and Recreation said yesterday
details of the funding agreement were confidential.
23. The club track was first proposed at the end of 1985, when
Mr Hoyle approached Murray Northrop to design and then supervise
construction of a $100,000 bitumen racetrack at Fairbairn Park.
24. The tender was won by Nomad. In court, Nomad said it had
received a first payment of $78,000, in two cheques, half way
through construction, but only after work on the site was
stopped. Rain hampered construction, and the laying of bitumen
hotmix was delayed because the track was wet.
25. The club was keen to have the track completed in time for
an important race meet. It said in court that it had lost
sponsorship money through the cancellation of two events before
the hotmix had been laid.
26. Despite advice to the contrary, a hotmix surface was laid in
August, 1986, on a wet and therefore inappropriate base,
resulting in a track which the club contended in its suit was
unsuitable for use by various vehicles for which it had been
intended.
27. The club blamed Nomad for doing substandard work and defaulted
on its second payment, leading Nomad to begin proceedings.
28. Justice Kelly found that the decision to lay the hotmix
had been taken by Murray Northrop. Murray Northrop claimed it had
sought approval from the club before going ahead.