Acp Publishing Pty Ltd v John Fairfax Publications P/L & Hilmer [2001] ACTSC 83 (17 August 2001)

Last Updated: 11 June 2002

ACP Publishing Pty Ltd v John Fairfax Publications P/L & Fred Hilmer [2001] ACTSC 83 (17 August 2001)

CATCHWORDS

PRACTICE AND PROCEDURE - Defamation proceedings - Whether the first and second defendants can be required to answer interrogatories which go to the issue of whether the Chief Executive officer published the matter complained of - Whether a chief executive officer of a publishing company is be liable at law for the content of publications issued by the company in the course of its publishing business.

P.G.L. Research v Ardon International [1993] F.S.R. 197.

C. Evans & Sons Ltd v Spritebrand Ltd [1985] F.S.R. 267

Levian v Fox (1890) 11 NSWR 414

Gatley, J.C.C (1998), Gatley on Libel and Slander, 9^th ed

Tobin & Sexton (1991), Australian Defamation Law and Practice, Butterworths [at 5210].

No. SC 43 of 2000

Coram: Master T. Connolly

Supreme Court of the ACT

Date: 17 August 2001

IN THE SUPREME COURT OF THE )

) No. SC 43 of 2000

AUSTRALIAN CAPITAL TERRITORY )

BETWEEN: ACP PUBLISHING PTY LTD

Plaintiff

AND: JOHN FAIRFAX PUBLICATIONS P/L

1^st Defendant

AND: FRED HILMER

2^nd Defendant

ORDER

Coram: Master T. Connolly

Date: 17 August 2001

Place: Canberra

THE COURT ORDERS THAT:

1. The plaintiff's application to have the first and second defendants answer interrogatories be dismissed.

2. The plaintiff pay the defendant's costs.

1. This is an application by way of Notice of Motion of 27 July 2001 in which the plaintiff seeks orders under Order 34 requiring the first and second defendants to answer certain interrogatories which were put to the defendants and answered by them in March 2001. The substantive proceeding is a claim for defamation in which the plaintiff, as publisher of Woman's Day, a magazine, asserts that it was defamed in an article published in the Sydney Morning Herald of 16 December 1999. The plaintiff sues the first defendant as printer, publisher and proprietor of the Sydney Morning Herald, and the second defendant as Chief Executive Officer of the first defendant.

2. There is an admitted error in the way the plaintiff has pleaded its case against the second defendant which it will correct, and which counsel for the second defendant did not rely on in the course of the present argument. The claim is brought against the second defendant as the Chief Executive Officer of the first defendant, being John Fairfax Publications Pty Ltd (ACN 003 357 720). By Defence filed on 22 June 2000 it is admitted that that company is the publisher and proprietor of the Sydney Morning Herald. That defence does not admit the assertion that Mr Hilmer is the Chief Executive Officer of the first defendant, and it emerged at the hearing of this application that he is in fact the Chief Executive Officer, not of the first defendant as such, but of a company described as John Fairfax Holdings Limited.

3. The substantive issue raised in this Notice of Motion is whether the first and second defendants can be required to answer interrogatories which go to the issue of whether Mr Hilmer published the matter complained of in the 16 December 1999 edition of the Sydney Morning Herald. Mr Tobin argues, for the defendants, that they should not be required to answer the interrogatories because this question is not a "matter in question" between the parties, as is required by Order 34 rule 1(1).

4. This argument is based on the nature of the case pleaded against the second defendant. By letter of 23 March 2000 the solicitors for the first and second defendants wrote to the solicitors for the plaintiff in the following terms seeking further and better particulars of the claim:

"We note the assertion in paragraph 4 of the Statement that the second defendant is the Chief Executive Officer of the first defendant, and the assertion in paragraph 5 of the Statement that the second defendant, presumably in that capacity, published the matter complained of. We point out, as you would well know, that a chief executive officer of a publishing company would not, prima facie, be liable at law, nor responsible in fact, for the content of publications issued by the company in the course of its publishing business. Accordingly, we would be grateful if you could provide us with full particulars of all the facts, matters and circumstances relied upon in support of the assertion that the second defendant published the matter complained of in these proceedings."

5. In response to this request for further and better particulars the plaintiff's solicitors wrote to the defendant's solicitors on 10 April 2000 as follows:

"The Second Defendant, as Chief Executive Officer of the First Defendant, is the person in the overall position of authority and general supervision of the publishing activities of the First Defendant. In such role, the Second Defendant is deemed to have participated in the publication of the matter complained of even though he may not have known of its defamatory content. See Australian Defamation Law and Practice, Tobin & Sexton [at 5210]."

6. The defendants argue that the plaintiff has chosen to plead this case on the basis, not that the second defendant actually had knowledge of the publication, but that he is deemed by operation of law, to have had such knowledge. As the plaintiff has, on this argument, not put the question of the actual level of the second defendant's knowledge or involvement in the publication in issue, the interrogatories, which seek to go to his involvement in exercising what may be referred to as editorial influence in the Sydney Morning Herald, is irrelevant to the case pleaded, which is based on deemed publication by reason of holding the office of Chief Executive Officer.

7. The defendants argue that the plaintiff is incorrect in asserting that the common law would hold the Chief Executive Officer of a publishing company (accepting for the argument that the plaintiff will amend the pleadings to correctly identify Mr Hilmer as the Chief Executive Officer of the overall holding company, and not of the company identified as the first defendant). They argue that the common law is well laid out in Gatley on Libel and Slander, 9^th ed 1998, where it is said that:

"the proprietor of a newspaper is also civilly liable even though the libel may have been published without his knowledge or in his absence, for the editor is his servant and it is within the scope of his employment to send to the printers whatever matter he thinks ought to be published"(para 6.15).

8. However, in the footnote to this statement of the law, in addition to the cases relied upon to support the proposition, it is stated:

"Of course, in modern conditions the proprietor in law will nearly always be a corporation but the same principle applies. But a director of the publishing company (who may in ordinary speech be referred to as the "proprietor") is not liable unless he has been actively involved: P.G.L. Research v Ardon International [1993] F.S.R. 197."

9. The decision referred to in support of the proposition that a director of the publishing company is not liable unless he has been actively involved is in fact not a case on defamation, but rather a decision going to a claim for tortious infringement of patent. Aldous J referred to the decision of the Court of Appeal in C. Evans & Sons Ltd v Spritebrand Ltd [1985] F.S.R. 267 where Slade L.J. said at 277 that the authorities:

"clearly show that a director of a company is not automatically to be identified with his company for the purpose of the law of tort, however small the company may be and however powerful his control over its affairs. Commercial enterprise and adventure is not to be discouraged by subjecting a director to such onerous potential liabilities. In every case where it is sought to make him liable for his company's torts, it is necessary to examine with care what part he played personally in regard to the act or acts complained of."

10. The proposition that the proprietor is deemed to have published is also supported by the authors in Tobin & Sexton, Australian Defamation Law and Practice at [5210], relying on old New South Wales authority (Levian v Fox (1890) 11 NSWR 414), but no discussion there appears on the question as to whether the common law responsibility of a proprietor extends to particular office holders (Chief Executive Officer, Board Chair, Board Member) of the incorporated body which is the proprietor of the newspaper.

11. Mr Tobin made the point that, as a matter of practice, defamation proceedings in Australia are normally directed at the actual publisher, be it newspaper publisher or television company, and not the individual who may be well known by the Australian public to be the dominant personality behind the company, whether as chair or chief executive of the body which has ultimate control of the newspaper or television station. This practice, he submitted, is not consistent with a common law principle that certain executive officers of publishing companies are deemed to have published any defamatory material appearing in that newspaper or television station. I make the observation that defamation proceedings could well become even more complex and expensive than they now are if the plaintiff in these proceedings is correct and prominent individuals involved in the senior management of the Australian media can be brought in as defendants in defamation proceedings and subjected to pre trial discovery and interrogatory processes.

12. I am not persuaded that the common law principle asserted by the plaintiff in their answer to the defendant's request for further and better particulars, that is that the chief executive officer of a publishing company is for the purposes of a defamation action to be deemed to have published material in the same way that an editor is deemed to have published, is correct. For the purpose of this interlocutory proceeding, my view on that asserted principle of law is not definitive. The plaintiff has chosen to plead its case on the basis of deemed publication, not on the basis that Mr Hilmer did in fact have so close a role in the publication of the Sydney Morning Herald that he can be held liable in defamation for an article that appeared in that newspaper on 16 December 1999. If this had been pleaded, it seems to me that interrogatories going to the extent to which the second defendant was involved in the process of editorial decision making at the Sydney Morning Herald, at least in the period around the date of publication, would be relevant to an issue between the parties, and I would have ordered the interrogatories to have been answered.

13. The plaintiff has chosen, however, to plead the case, not on the basis of what may be termed actual publication, but on the basis of deemed publication. In their answer to the request for further and better particulars they stated that Mr Hilmer "is deemed to have participated in the publication of the matter complained of even though he may not have known of its defamatory content." By pleading that the second defendant is a deemed rather than an actual publisher, it seems to me that the plaintiff has chosen to put in issue between the parties only the question of Mr Hilmer's position as Chief Executive Officer in the holding company, and that interrogatories going to any actual control that he may have exercised in what may be described as the editorial decision making process at the Sydney Morning Herald are beyond the scope of the present proceedings, as pleaded.

14. I would accordingly decline to order that the first and second defendants answer the interrogatories. Costs should follow the event.

I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of Master T. Connolly.

Associate:

Date: 17 August 2001

Counsel for the Plaintiff: Mr McClintock

Solicitor for the Plaintiff: Phillips Fox

Counsel for the Defendant: Mr Tobin

Solicitor for the Defendant: Freehills

Date of hearing: 27 July 2001

Date of judgment: 17 August 2001