Azzi v Fairfax Media Publications Pty Ltd

[2018] NSWDC 69

District Court

New South Wales

Medium Neutral Citation:	Azzi v Fairfax Media Publications Pty Ltd [2018] NSWDC 69
Hearing dates:	8 March 2018
Date of orders:	08 March 2018
Decision date:	29 March 2018
Jurisdiction:	Civil
Before:	Gibson DCJ
Decision:	(1) The plaintiff is to give further and better particulars of paragraphs (c) and (d) of the claim for aggravated damages in the statement of claim, such particulars are to be provided in 7 days. (2) Strike out imputations 5(i) and 8(i) and grant leave to the plaintiff to replead to encapsulate a defamatory act or condition of the plaintiff. (3) Pursuant to r 28.2 Uniform Civil Procedure Rules 2005 (NSW), strike out imputations 5(ii) and 8(ii) on the basis that an imputation of guilt, as opposed to reasonably suspicion, is not reasonably capable of being conveyed. Grant leave to the plaintiff to replead imputations 5(ii) and 8(ii). (4) Imputations 5(iii) and 8(iii) are reasonably capable of being conveyed. (5) Defendant’s objections to the form of imputations 5(iii) and 8(iii) is dismissed. (6) Strike out imputations 5(iv), 8(iv), 5(v), 8(v), 5(vi) and 8(vi) on the basis that the matter complained of does not convey an imputation of guilt as opposed to reasonable suspicion. (7) Amended Statement of Claim in 7 days. (8) The plaintiff is to pay the costs of the argument today. (9) Matter stood over to the Defamation List on Thursday 29 March 2018.
Catchwords:	TORT – defamation – imputations – form and capacity – guilt and suspicion – group libel
Legislation Cited:	Uniform Civil Procedure Rules 2005 (NSW), rr 14.30 and 28.2
Cases Cited:	Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158 Chase v News Group Newspapers Ltd [2002] EWCA 1772; [2003] EMLR 11 Christiansen v Fairfax Media Publications Pty Ltd [2012] NSWSC Corby v Allen & Unwin Pty Ltd [2014] NSWCA 227 Drummoyne Municipal Council v Australian Broadcasting Corporation (1990) 21 NSWLR 135 Gant v Age Co Ltd [2011] VSC 169 Greig v WIN Television NSW Pty Ltd [2007] NSWSC 1118 Hibbert v Nationwide News Pty Ltd [2015] NSWCA 13 Knupffer v London Express Newspaper Ltd [1944] AC 116 Lewis v Daily Telegraph Ltd [1964] AC 234 McCormick v John Fairfax & Sons Ltd (1989) 16 NSWLR 485 Rayney v State of Western Australia (No 9) [2017] WASC 367 Sands v State of South Australia (2015) 122 SASR 195 Sergi v Australian Broadcasting Commission [1983] 2 NSWLR 669
Category:	Procedural and other rulings
Parties:	Plaintiff: Pierre Azzi First Defendant: Fairfax Media Publications Pty Ltd Second Defendant: Kate McClymont
Representation:	Counsel: Plaintiff: Mr R Rasmussen Defendant: Ms M Cowden   Solicitors: Plaintiff: Stewart & Associates Defendant: Banki Haddock Fiora
File Number(s):	2017/382935
Publication restriction:	None

Judgment

1. The plaintiff by statement of claim filed on 19 December 2017 brings proceedings for defamation for each of the print and online versions of publications naming the plaintiff in relation to an inquiry being carried out by the Independent Commission Against Corruption (“ICAC”). The print version, headed “ICAC takes on Sydney’s biggest council”, appeared in the Sydney Morning Herald dated 15-16 July 2017 on pages 1 and 4. The online version, which is rather more sensationally headed “Potential corruption at Canterbury is bigger than Wollongong, but without the sex”, appeared on the defendant’s website at the same time. Apart from the different headings, the articles are identical. They are hereafter referred to as “the matters complained of”.

2. This judgment sets out my reasons for rulings made on 8 March 2018, in the course of a separate trial as to the capacity of each of the imputations, pursuant to r 28.2 Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”) (Hibbert v Nationwide News Pty Ltd [2015] NSWCA 13) and as to the form of the imputations pleaded pursuant to r 14.30 UCPR.

The imputations the subject of this application

3. Paragraphs 5 and 8 of the statement of claim deal separately with each of the print and online matters complained of. Each paragraph pleads the following imputations:

1. The Independent Commission Against Corruption executed search warrants at the home of the plaintiff.

2. The plaintiff took bribes to approve developments whilst he was a Councillor on Canterbury Council.

3. The plaintiff is reasonably suspected by the Independent Commission Against Corruption of knowingly taking part in corrupt planning decisions whilst he was a councillor on Canterbury Council.

4. The plaintiff took part in planning meetings that he knew were corrupt in that they were hosted in his home and were attended by developers, lobbyists, Councillors and Council planning staff.

5. The plaintiff took part in planning meetings that he knew were corrupt in that they were hosted in private homes and were attended by developers, lobbyists, Councillors and Council planning staff.

6. The plaintiff, a labour party Councillor, joined with liberal party Councillors to make corrupt planning decisions for developments along Canterbury Road and Charles Street which had already been rejected by planning staff due to non-compliance.

4. As the publications are identical (save for the headline) the rulings on meaning are the same for both of the matters complained of.

The relevant principles of law

5. The issues arising in the course of argument are:

1. The principles applicable to a separate trial of capacity under UCPR r 28.2, as well as to objections to form;

2. The correct approach to imputations of guilt concerning criminal conduct, as opposed to mere suspicion; and

3. Imputations aimed at one or more members of a readily defined class (“group libel”).

Challenges to the form and capacity of imputations

6. Where a separate trial of the capacity of imputations is held (in the manner set out in Hibbert v Nationwide News Pty Ltd at [20]–[22]), the relevant principles to apply are those set out in Corby v Allen & Unwin Pty Ltd [2014] NSWCA 227 at [135]–[136]. I also note, given the somewhat sensational tone of the matters complained of, the observations of Hunt CJ at CL in Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158 as to the likelihood of a degree of loose-thinking.

7. Objections as to the form of imputations will depend upon the nature of the objection; typical examples are helpfully set out by Beach J in Gant v Age Co Ltd [2011] VSC 169 at [40].

8. The principal issue of contention is the degree to which the matters complained of identify the plaintiff as being suspected of, or guilty of, the acts of wrongdoing identified in the matters complained of, and whether the allegations about the plaintiff are restricted to the portion in which he is named, or arise (by reason of his position as a councillor and/or being a Labor member) in relation to all the imputations pleaded. As is set out below, the position of the plaintiff is that he is accused of being guilty of everything, while the position of the defendants is that the plaintiff’s conduct only gives rise to a reasonable suspicion, and only in relation to the circumstances in which he is actually named.

9. The issues raised in this application are problems common to the reporting of any inquiry by an investigative body, and the issues of law raised are commonly encountered in relation to such reports.

Imputations of guilt as opposed to mere suspicion

10. Apart from imputations 5(iii) and 8(iii), the imputations (set out above) are of guilt, in relation to criminal conduct of different kinds, as opposed to suspicion.

11. Two preliminary issues arise. The first of these is Mr Rasmussen’s submission that imputations of reasonable suspicion by the ICAC is impermissible, as the ICAC is unable to lay charges and thus not a body capable of holding suspicions. The only “suspicion” imputations that can be pleaded must relate to prosecuting bodies such as the police. Mr Rasmussen submitted that this was the ratio of Sergi v Australian Broadcasting Commission [1983] 2 NSWLR 669 (“Sergi”).

12. A similar argument was put in Greig v WIN Television NSW Pty Ltd [2007] NSWSC 1118. Nicholas J explained (at [10]-[16]) why Sergi was not authority for propositions of the kind put by Mr Rasmussen:

“10 In my opinion imputations 5(c) and 7(c) unambiguously, and with precision, specify the act or condition which the plaintiff claims to be attributed to her by the matters complained of. Each identifies her conduct or behaviour which provided the basis for the reasonable suspicion that she had acted corruptly, i.e.: that in handling a planned councillor technology upgrade for the Shellharbour City Council she accepted Blackberry devices from private communications representatives.

11 The sting is clear. It is that the plaintiff’s conduct has given rise to a suspicion on reasonable grounds that she had acted corruptly. So understood, it cannot reasonably be said that the imputations as pleaded are likely to lead to confusion. The defendant’s application that they be struck out as defective in form is refused.

…

15 Accordingly, in my opinion, the defendant could, in general terms, mount a case to the effect that there were at the date of publication of the matters complained of facts that gave rise, objectively judged, to reasonable grounds to suspect the plaintiff of acting corruptly in accepting Blackberry devices from communications representatives whilst handling a planned councillor technology upgrade for the Shellharbour City Council. (King v Telegraph Group Ltd (2004) EWCA Civ 613; (2005) 1 WLR 2282, paras 22, 23)

16 In concluding that the defendant’s challenge has failed, it is unnecessary to resort to an analysis of the reasons in Sergi, and of Levine J in Purcell & Anor v Cruising Yacht Club of Australia Pty Ltd & Ors (2002) NSWSC 557, and of Kirby J in Purcell (2003) NSWSC 245. It is sufficient to say that, in my opinion, Sergi is a case of limited application. The Court disallowed imputations cast in the passive voice on the basis that their capacity to defame the plaintiff could not be judged because they failed to identify the accuser (pp 761, 679, 680). It went no further than holding that where the passive voice is used in connection with accusations, it is necessary to specify the accuser (Hutley JA, p 671). I also agree, with respect, that Kirby J in Purcell (2003) NSWSC 245, correctly accepted the defendant’s argument which he stated to be:

“28 A plaintiff, in framing an imputation, or a defendant in framing a contextual imputation, may, according to the defendants, formulate the imputation in one of two ways. Either the suspicion must be attributed to an authority figure, such as the police, or the imputation (as here) must be framed in terms of “reasonable grounds to suspect”, or the plaintiff having acted in such a way as to warrant suspicion. To say that the police “suspect” a person of murder is defamatory. It is also defamatory to say that there are reasonable grounds for suspecting that person committed murder.””

13. Mr Rasmussen’s argument appears to extend to a claim that the imputations are “guilt or nothing”, in that imputations of guilt have to arise, as there is no alternative of reasonable suspicion possible because of the ICAC’s nature as a solely investigative body.

14. For the reasons explained by Nicholas J, an imputation of reasonable suspicion by the ICAC is permissible. I note that imputations 5(iii) and 8(iii) do in fact plead that the plaintiff was reasonably suspected by the ICAC of such conduct, which tends to undermine Mr Rasmussen’s argument.

15. However, even if that were not the case, if the matter complained of cannot support an imputation of guilt, then the absence of availability of a reasonable suspicion would not be a basis for the pleading of an imputation that could not otherwise be conveyed.

16. The second submission Mr Rasmussen put was that the defendants could not use the “Chase” (Chase v News Group Newspapers Ltd [2002] EWCA 1772; [2003] EMLR 11) method of analysis of imputations of guilt or suspicion. Mr Rasmussen submitted that the traditional approach of Lewis v Daily Telegraph Ltd [1964] AC 234 was the only approach the court should take.

17. The “Chase” method of analysis is discerned and explained in Rayney v State of Western Australia (No 9) [2017] WASC 367 at [60]-[64] and in Sands v State of South Australia (2015) 122 SASR 195 at [238] (“Sands”). In Sands, the Full Court explained the process of analysis of imputations of guilt and suspicion in traditional terms, followed by “Chase” terms, as follows:

“[238] On the other hand, as a matter of human experience and convention, a statement about a person’s guilt or a speaker’s perception of a person’s guilt is often understood as falling into one of a discrete number of common categories. Three such categories are that there are grounds for inquiry whether a person is guilty, that there are reasonable grounds to suspect a person is guilty and that a person is guilty. Thus, in Lewis v Daily Telegraph Ltd Lord Devlin said:

In the present case, for example, there could have been three different categories of justification — proof of the fact of an inquiry, proof of reasonable grounds for it, and proof of guilt.

In Flood v Times Newspapers Ltd, Lord Phillips said:

In Chase v News Group Newspapers Ltd Brooke LJ identified three possible defamatory meanings that might be derived from a publication alleging police investigations into the conduct of a claimant. These have been adopted as useful shorthand in subsequent cases. The Chase level 1 meaning is that the claimant was guilty. The Chase level 2 meaning is that there were reasonable grounds to suspect that the claimant was guilty. The Chase level 3 meaning is that there were grounds for investigating whether the claimant was guilty.” (Citations omitted)

18. These approaches – the traditional Lewis v Daily Telegraph analysis and modern categorisation of Chase levels 1 to 3 – are fundamentally similar; that the principal difference is the degree of delineation permitted by the Chase approach, which enable a more accurate distillation of meaning (including a third ground, namely grounds for investigating) to be made. As the Chase approach has been endorsed at appellate level, it is appropriate to be applied in circumstances such as the present.

19. The defendants’ submission (in relation to all imputations) is that any imputations capable of arising cannot impute guilt as the basis of the imputation in that each would, at best, be a “Chase level 3” imputation that there were grounds for investigating whether the plaintiff was guilty. The defendants’ primary position was, however, that no imputations were capable of arising at all.

20. It is always important, when determining capacity issues, to approach each imputation individually. For example, there may be cases where one particular imputation is one of guilt whereas others are imputations of reasonable suspicion, or vice versa. However, where the imputations arise in a publication where an identifiable group of persons is accused of a series of nefarious activities (as is the case here), the fact that the plaintiff is named or referred to in relation to only one of those activities carries less import than it would otherwise have had.

21. The issue is what to make of the repeated references to “the former Canterbury Council” being “bigger than Wollongong” in terms of potential corruption of the kind which the matters complained of then go on to describe. These are allegations made against a group of persons, of whom the plaintiff is one – in other words, a “group libel” (Knupffer v London Express Newspaper Ltd [1944] AC 116 at 119 per Viscount Simon LC (“Knupffer”)).

22. In Knupffer, the plaintiff sued for libel for a publication which cast aspersions on unnamed members of the “Young Russia Party”. This was a very small organisation (there were only 24 members) of which Mr Knupffer was the leader. Four witnesses gave evidence that, when they read the article, they identified him. The plaintiff lost the case because the parameters of the group were so vague that imputations of and concerning him could not be conveyed, but the principle that an individual who could prove identification as a member of a defined group was accepted as correct. Where the identification of a group is clear (in this case, the elected members of a municipal council), imputations may arise in relation to any member of the group, depending upon the nature of the accusation.

23. This brings me to the principles governing what is generally referred to as “group libel”. When dealing with imputations of guilt or suspicion, different principles will apply when the allegations are made against one, or than one or all members of a class, as opposed to a specific allegation against a specific individual. These “group libel” principles apply in publications such as the present where the wrongdoers (or potential wrongdoers) are members of a clearly identifiable class, whether or not the plaintiff has been named in the matter complained of, where the allegations relate to the conduct of one or more the class.

Imputations aimed at one or more members of a class

24. The persons who are the members of the class are readily identifiable from the matter complained of in that they are the persons identifiable by the description “the former Canterbury Council” in circumstances where these persons are accused of conduct which is “bigger than Wollongong Council – but without the sex.”

25. If the plaintiff had been a Council employee, or unnamed, it would have been necessary to determine whether he has in fact been identified, but the fact that he has been named (albeit only in relation to a search warrant) and is in fact a councillor means that membership of the class is not really in issue. The question is whether imputations are conveyed about him as an individual or as a member of the group.

26. The defendants’ submissions that the imputations are incapable of arising are in part of the “bane and antidote” variety (for example, references to there not being “any information on whom, if anyone, may be caught up in a future inquiry”) and in part on the assertion that the appearance of the plaintiff’s name as the recipient of a search warrant means that this is all he can be accused of, and the ordinary reasonable reader would not consider that being the recipient of a search warrant necessarily implies wrongdoing. Mr Rasmussen’s submissions in reply are that the references to his client being served with the search warrant at his home means that he must be guilty because it is like Wollongong Council (only without the sex).

27. Both these submissions fail to deal with the “group” nature of the allegations. As the analysis of the matter complained of set out below indicates, the publication does not concern itself with the conduct of the plaintiff as an individual, but with a group, of which the plaintiff is a member, some (but clearly not all) of whom are accused of “potential corruption” similar to that uncovered at Wollongong Council a decade beforehand.

28. In McCormick v John Fairfax & Sons Ltd (1989) 16 NSWLR 485, Hunt J set out the correct manner in which imputations arising in relation to one or more of an identifiable group (in that case, group of private investigators) should be pleaded. The issue in that case was whether the plaintiff could sue as a member of a class in relation to the allegation that only one of that class was responsible for perverting the course of justice and for dealing with stolen property, where the matter complained of did not assert that each member of the class was guilty of that conduct, and where there was no clear indicator in the matter complained of which pointed to a particular group member as the one who was guilty of the stated conduct (p 488D).

29. In rejecting an imputation of guilt, Hunt J stated:

“As the matter complained of in the present action cannot, by its express wording, be interpreted asserting that each member of the class was guilty of this particular conduct, and as there is nothing in the matter which points to the plaintiff as the one who was alleged to have been guilty of that conduct, it is incapable of conveying the imputation that it was the plaintiff who was guilty of that conduct.” (at 491C)

30. Hunt J then went on to consider the implications of a case such as the present, namely where the slur or reflection is cast upon all of the members of a class where the matter complained of asserts that one or more member of that class was guilty of the particular discreditable conduct (at 491E). His Honour explained the application of these principles as follows:

“Spencer Bower, A Code of Actionable Defamation, 2nd ed (1923) at 12, suggests that each member of the class would be defamed as either probably or possibly guilty of that conduct, the degree of probability being in inverse ratio to the number of persons in the class; an imputation of some degree is there, he says, and suspicion to some extent is cast upon each of them. I am completely unable to accept that statement. If only one of a class of three (or even one of a class of two) is alleged to have done a particular act, how could that allegation possibly be interpreted reasonably as asserting that all three of them (or both of them) probably did that act? The question has only to be asked for the fallacy in that proposition to be revealed. The highest that could be put is that the reader could suspect each of the members of the class of having done that act if the class is sufficiently small. That is, of course, quite a different proposition from saying that the imputation conveyed by the matter complained of was that each member of the class was suspected by someone — for example, the police — of having done that act: cf Sergi v Australian Broadcasting Commission [1983] 2 NSWLR 669. There is nothing in the matter complained of in the present case to suggest that each of the partners was suspected by anyone of having perverted the course of justice. What it says is that one of that class of three did in fact do so, and it is left to the reader to suspect that each of them may have been guilty of that particular conduct.

Duncan & Neill Defamation, 2nd ed (1983) par 6.13 at 28, agree that the test is the “intensity” of the suspicion cast upon each member of the class, and they suggest that each such member of the class would be seen as, for example, associates of criminals or persons who had not made sufficient inquiry as to the character of their business associates. I feel that to limit the possible imputations to those suggested there may be too restrictive, but in my view they are good illustrations of the nature of the imputations which might apply in such a case. The slur (Fleming) or the reflection (Gatley) upon the reputation of each member of the class cannot be based upon an assumption by the reader that he was guilty of that conduct himself; it may only be based upon the relationship of that member of the class with the person who was guilty of that conduct.”

31. These passages were cited by Nicholas J in Christiansen v Fairfax Media Publications Pty Ltd [2012] NSWSC 1258 at [20]-[21]. The defendant in those proceedings, as was the case here, had sought to argue that imputations of suspicion (either at all or, at most, beyond a “Chase 3” level) could not arise from the mere reference to the plaintiff as one of three Star City managers whose emails had been searched. In relation to alleged misuse of sensitive information, Nicholas J was critical of the reasoning of Hunt J (at [29]) but ultimately determined that the “fundamental question” (at [30]) would depend upon what the matter complained of would mean to the ordinary reasonable reader, which would depend upon the relevant factual issues in each case.

32. As to the form of imputations of a “group libel” nature, the observations of Nicholas J in Christiansen v Fairfax Media Publications Pty Ltd at [33] that “reasonably suspected of” is preferable to the “may have been” formula preferred by Hunt J has much to recommend it, and is generally the form now used.

33. Once these principles are applied to the facts of this case, it is readily apparent that imputations of suspicion in relation to the activities engaged in by the councillors (not merely in relation to the meetings held at the plaintiff’s home) must apply.

34. The first issue is the structure of the publications and a consideration of the passages asserted to give rise to each of the imputations.

The structure of the publications

35. The central issue in the argument is whether the matters complained of give rise to imputations of guilt or of reasonable suspicion. In this regard, the following features in the matters complained of should be noted:

1. This was the second lead story in the weekend newspaper published by the defendant and is headed “Exclusive”. The heading on the online publication is best described as “clickbait” intended to attract readers.

2. The tone of the matters complained of is of a sensational nature, in that what has been uncovered is “rumoured to be bigger than Wollongong council – but without the sex” (paragraph 4).

3. The matters complained of describe an investigation taking place over the past year, which indicates that the ICAC is building a case in which the identity of the miscreants remains uncertain, other than that they are councillors. There is reference to the execution of search warrants at “a number of premises” including homes and offices of Liberal councillors, as well as the home of the plaintiff who is identified as “Labor's Pierre Azzi” (paragraph 7). That is the only mention of the plaintiff’s name.

4. The primary references to named persons are to Liberal Councillor Michael Hawatt and one of the sons of real estate agent George Vasiliades, both of whom are pictured. A response from Councillor Michael Hawatt, denying wrongdoing and criticising the ICAC, is set out at paragraphs 7, 8 and 31. Mr Vasiliades’ two sons are later identified as standing for Liberal pre-selection.

5. Two areas of interest to the ICAC investigation are identified at paragraphs 9 and 10. The first of these is a planning decision which saw “some Liberal and Labor councillors voting together to approve developments which council's planning staff had previously rejected due to non compliance.” The Liberal and Labor councillors involved are not identified, although it should be noted that the only Labor councillor referred to by name is the plaintiff. Secondly, there is a reference to “meetings hosted in private homes attended by developers, lobbyists, councillors and staff” (paragraph 10), without identifying the homes of the persons involved. However, as already noted, the plaintiff’s home was the site of the execution of a search warrant, according to paragraph 6.

6. The matters complained of go on to set out that there has been no formal announcement by the ICAC (which has “power brokers from both major political parties in a quandary” (paragraph 11), or whether there will be a public hearing (paragraph 12) and, crucially, that there is no information as to “whom, if anyone, may be caught up in a future inquiry” (paragraph 14)). As a result, both political parties were struggling with pre-selections for the next council elections, apparently in relation to all their candidates, not merely the plaintiff.

7. It is in this context that there is a reference to a candidate for Liberal pre-selection, Mr Con Vasiliades, at paragraphs 22 to 27 and 30, to a property developer, Mr Charlie Demian (paragraphs 27 and 28) and to a statement made by the local government minister, a member of the Liberal Party (although this is not stated in the matters complained of), about whether there had been a request to defer the Canterbury Bankstown election.

8. The photographs in the matters complained of, as noted above, are of Mr Hawatt and Mr Con Vasiliades, not of the plaintiff.

9. As to the subject matter of the investigation, although there is a reference in paragraph 3 to “allegedly corrupt planning decisions made by the former Canterbury council” and that the degree of corruption depends on “who you talk to” (paragraph 4), in circumstances where it was unclear as to “whom, if anyone” was caught up with the inquiry, the subject matter is identified as being corrupt conduct, particularly in relation to planning decisions along Canterbury Road and Charles Street where Liberal and Labor councillors voted together and the circumstances in which there were meetings held in private homes. In addition, there are references to ICAC being interested in a development involving Mr Demian. The plaintiff’s connection to the first and second of these is that he is a Labor Party councillor whose whom was the subject of a search warrant, but that is the extent of the connection.

10. Finally, I note that the first of the matters complained of contains the footnote “SMH Investigations”, with an email address of [email protected]. That adds to the impression, in relation to the first publication, that this is a report of an investigation and/or of matters needing investigation, in that the email address by implication is inviting the provision of further information.

36. Once the relevant legal principles are applied and the structure of the matter complained of is examined, the determination of the form and capacity of the imputations becomes a relatively easy task, in that the combined effect of the identification of a group of persons, some or indeed many of whom are suspicion by the ICAC for the conduct described, means that the plaintiff’s role as a member of the group under investigation, and not merely that portion containing his name, is of relevance in relation to capacity. However, in circumstances where the member of the group who is the wrongdoer is not identified, the imputation is of suspicion and not guilt.

Imputations 5(i) and 8(i)

37. Mr Rasmussen conceded during the argument that these imputations needed to be redrafted for form reasons, as they do not convey an act or condition, and leave to do so was accordingly granted. I have not made any capacity ruling as a result.

Imputations 5(ii) and 8(ii)

38. As to the defendants’ submissions, the nature of the allegations against some Liberal and Labor members of Canterbury Council is sufficient to convey allegations that the conduct the suspect of reasonable suspicion includes making “allegedly corrupt” decisions in favour of developers in secretive circumstances at councillors’ homes. The ordinary reasonable reader could infer that this was done in exchange for some kind of financial remuneration. The search of the plaintiff’s home and the reference to deals done between Liberal and Labor (in circumstances where the plaintiff is the only named Labor councillor) are enough, on a capacity basis, to awaken suspicion of the kind that might be felt by the ordinary reasonable reader. Once again, the unfortunate reference to Canterbury Council tends to underscore such a likelihood.

39. However, as noted above, the matter complained of does not assert guilt. This is in part because of the language of the matters complained of and in part because of the “group libel” nature of the claims of wrongdoing where the identity of the wrongdoers is not revealed. As in the detective novel where the suspects are gathered together in the library, there is an array of persons identified, some of whom look more suspicious than others, but the structure and language of the matters complained of stop short of identifying any one person, let alone the plaintiff.

40. As to capacity, the plaintiff has been granted leave to replead these imputations as matters of suspicion rather than guilt.

Imputations 5(iii) and 8(iii)

41. These imputations correctly plead that the plaintiff was reasonably suspected by the ICAC of the conduct pleaded in the imputation. I note the submissions of the defendant as to the use of the words “potential” and “allegedly” but, having regard to the test for capacity as set out above, these are issues for determination by the tribunal of fact at the hearing, not least because of the comparison to Wollongong Council, where findings of guilt were in fact made.

42. As to form, the use of the word “corrupt” is permissible in relation to a publication of this kind where the word is not only used in the matter complained of, in the heading (“potentially corrupt”) and body of the text (“allegedly corrupt”) and where the conduct is being investigated by the ICAC. I note the reliance upon Drummoyne Municipal Council v Australian Broadcasting Corporation (1990) 21 NSWLR 135 at 138 but, unlike that publication, this is one where there is a great deal of particularity about the corrupt actions asserted to have taken place.

43. The objection to the phrase “taking part in” similarly needs to be read in context of the degree of particularity, in that the plaintiff is identified by name and his home was the subject of a search warrant.

44. Accordingly, these imputations are reasonably capable of being conveyed.

Imputations 5(iv) and 8(iv); 5(v) and 8(v)

45. These were pleaded in the alternative, to reflect that the meetings could have taken place in the plaintiff’s home or, alternatively, that the plaintiff was one of the councillors attending meetings in other councillors’ homes.

46. The same difficulties of guilt or suspicion arise in relation to each of these, and in particular in relation to imputations 5(v) and 8(v), which relate to other people’s homes. The innuendo nature of the publication and the generality of the accusations against an unnamed group of Council members from Liberal and Labor factions indicate that the plaintiff is suspected rather than guilty.

47. Mr Rasmussen conceded that all four imputations would benefit from being repleaded to identify that these meetings were held in private homes (or alternatively the plaintiff’s home) and not in the Council chambers.

48. These imputations were struck out with leave to replead on the basis set out in the orders below, to reflect my capacity ruling that the imputations pleaded convey reasonable suspicion by the ICAC.

Imputations 5(vi) and 5(vi)

49. The plaintiff is identified only as a councillor whose home was searched. Whether the plaintiff actually was one of the Labor councillors who joined with Liberals in rejecting the planning decisions already rejected by the planning staff arises in a “group libel” sense and thus only on reasonable suspicion. This imputation should accordingly be repleaded as one of reasonable suspicion by the ICAC.

50. The objections to form of the imputation were not really able to be determined, given the striking out of the imputation on “group libel” and “reasonable suspicion” grounds, but I consider that the terms of the matter complained of would permit the plaintiff to use the word “corrupt” in any repleaded imputation, in view of the specificity of the conduct involved.

Costs

51. The defendants were successful in their challenges to all imputations except 5(iii) and 8(iii).

52. In those circumstances, costs should follow the event, and the plaintiff should pay the defendants’ costs.

Orders

1. The plaintiff is to give further and better particulars of paragraphs (c) and (d) of the claim for aggravated damages in the statement of claim, such particulars are to be provided in 7 days.

2. Strike out imputations 5(i) and 8(i) and grant leave to the plaintiff to replead to encapsulate a defamatory act or condition of the plaintiff.

3. Pursuant to r 28.2 Uniform Civil Procedure Rules 2005 (NSW), strike out imputations 5(ii) and 8(ii) on the basis that an imputation of guilt, as opposed to reasonably suspicion, is not reasonably capable of being conveyed. Grant leave to the plaintiff to replead imputations 5(ii) and 8(ii).

4. Imputations 5(iii) and 8(iii) are reasonably capable of being conveyed.

5. Defendant’s objections to the form of imputations 5(iii) and 8(iii) is dismissed.

6. Strike out imputations 5(iv), 8(iv), 5(v), 8(v), 5(vi) and 8(vi) on the basis that the matter complained of does not convey an imputation of guilt as opposed to reasonable suspicion.

7. Amended Statement of Claim in 7 days.

8. The plaintiff is to pay the costs of the argument today.

9. Matter stood over to the Defamation List on Thursday 29 March 2018.

**********

Decision last updated: 29 March 2018