Belbin v Lower Murray Urban and Rural Water Corporation (Ruling No 4)

[2012] VSC 484

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MILDURA

COMMON LAW DIVISION
MAJOR TORTS LIST

S CI 2010 04662

JIM BELBIN	Plaintiff
v
LOWER MURRAY URBAN AND RURAL WATER CORPORATION	Defendant

S CI 2010 04536

FRANK DI MASI	Plaintiff
v
LOWER MURRAY URBAN AND RURAL WATER CORPORATION	Defendant

S CI 2010 04757

DON MARCIANO	Plaintiff
v
LOWER MURRAY URBAN AND RURAL WATER CORPORATION	Defendant

S CI 2010 04707

NANCY PREVEDELLO	Plaintiff
v
LOWER MURRAY URBAN AND RURAL WATER CORPORATION	Defendant

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JUDGE:	KAYE J
WHERE HELD:	Melbourne
DATE OF HEARING:	18 October 2012
DATE OF RULING:	19 October 2012
CASE MAY BE CITED AS:	Belbin & Ors v Lower Murray Urban and Rural Water Corporation (Ruling No 4)
MEDIUM NEUTRAL CITATION:	[2012] VSC 484

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PRACTICE AND PROCEDURE – Defamation – Application by defendant to re-open its case on the issue of damages after judgment reserved and before final judgment delivered – Article in local newspaper revealing without prejudice communications between the parties – Whether relevant to issue of damages – Whether evidence as to the source of the article admissible – Whether leave should be granted.

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APPEARANCES:	Counsel	Solicitors
In each case for the Plaintiffs	Mr D Gilbertson	HWL Ebsworth Lawyers
In each case for the Defendant	Dr M Collins SC and Mr N Kaskani	DLA Piper Australia

HIS HONOUR:

1. In these four cases, the plaintiffs claim damages for defamation.  The jury delivered its verdicts on 21 August 2012.  On 8, 9 and 10 October I heard submissions as to whether the defendant had established either of its defences to the actions, and on the issue of damages. 

1. On 10 October, senior counsel for the defendant, Dr Collins SC, referred to an article which was published on that day in the Sunraysia Daily newspaper relating to the proceedings.  He told me that the article referred to confidential, without prejudice communications between the parties.  I had not read the article, and I requested Dr Collins to make his submissions relating to it in a manner which did not reveal the nature or substance of any of the confidential communications, which might have been referred to in the article.  Dr Collins stated that the matter was a serious one, and that it might have relevance to the claims by the plaintiffs for damages.  I indicated to him that, in light of the difficult issues which had been raised in respect of the defences and damages, I would reserve my decision, which would give him time, if he thought fit, to raise the matter before me subsequently.  Upon the completion of submissions relating to the defences and damages, I reserved my decision. 

1. The defendant has now applied to re-open its case, in order to subpoena the journalist who was responsible for the article, Mr O’Neill, to give evidence before me.  In support of that application, Dr Collins has submitted that the defendant has, without success, endeavoured to ascertain the identity of the person, who was the source of the disclosure to Mr O’Neill of the confidential communications between the parties.  When the matter was mentioned in court on 10 October, Mr Gilbertson, who appears for the plaintiff, gave an assurance to the court that neither he nor his instructing solicitor had provided that information to the journalist.  Accordingly, Dr Collins submitted that it might be inferred that one or more of the plaintiffs had been responsible for divulging that information to the journalist. 

1. Dr Collins submitted that if, by calling Mr O’Neill, he is able to establish that one of the plaintiffs was responsible for the disclosure of the confidential information to the journalist, that fact would be relevant to the issue of damages.  In support of that submission, he referred to the obiter dictum of Lord Hailsham in Broome v Cassell & Co[1], which suggests that, in assessing damages, the court is entitled to take into account the conduct of the plaintiff from the time of the publication of the defamatory matter until the time of verdict.  Dr Collins submitted that, if the defendant is able to establish that a plaintiff was responsible for the disclosure of the confidential communications to the journalist, he would invite me to draw an inference that the particular plaintiff was thereby attempting to interfere with the course of justice, or, alternatively, that that particular plaintiff had brought this proceeding for an ulterior purpose. 

   [1][1972] AC 1027, 1071.

1. On the other hand, Mr Gilbertson submitted that I should not give the defendant leave to re-open its case.  He submitted, first, that if in fact the defendant were able to establish that a plaintiff had divulged the confidential information to the journalist, that fact, alone, would not be a sufficient basis for either of the inferences adumbrated by Dr Collins.  Thus, he submitted that evidence, as to the source of the article published by the journalist, would not be relevant to the issue of damages.  Secondly, Mr Gilbertson submitted that, if the defendant is permitted to re-open its case, such a course would necessarily involve the revelation to me, as the judge of the facts, of confidential privileged communications between the parties.  He submitted that I would thereby be placed in an embarrassing position, and that, in that way, justice would not be seen to be done between the parties.  In support of that proposition, he relied on two previous decisions of the Full Court of Victoria, in each of which the court referred to the embarrassing consequences of the disclosure to it of the fact and amount of payments into court by a defendant in personal injury proceedings.[2]

   [2]Skafidas v ATM Industries Pty Ltd [1978] VR 164; Williams v Volta [1982] VR 739, 745 (McInerney J).

1. I have deliberately refrained from reading the article, to which Dr Collins has referred.  For obvious reasons, it is most undesirable that I read it, or learn of its contents, until after I have delivered my reasons for judgment.  However, for the purposes of this application, I shall accept that the article refers to without prejudice communications between the parties, which, as such, would ordinarily be privileged.

1. When Dr Collins raised this matter for my attention on 10 October, I expressed concern that a newspaper, or any other media outlet, should publish matters which, it is well understood, are privileged, and which should not be in the public domain, at least before judgment.  That principle is well understood, and it is ordinarily rigorously adhered to, and respected, by our media.  It is a most important principle, as its purpose is to preserve the integrity of our system of justice, and, equally importantly, to support the public’s confidence that judges and juries decide cases without having brought to their attention extraneous matters, which might influence or prejudice their decisions.  I reiterated those concerns on the application before me on 18 October.  Nothing which I say in these reasons should detract from, or diminish, what I have said in that regard. 

1. Ordinarily, there must be exceptional circumstances before a court will allow a case, which has been closed, and in which judgment has been reserved, to be re-opened.[3]  That principle is founded in the importance, to our system of justice, of the finality of litigation. 

   [3]Spotlight Pty Ltd v Ncon Australia Ltd [2012] VSCA 232, [17] (Harper and Tate JJA, Beach AJA).

1. Obviously, in this case, the defendant could not have known of the offending publication, in a newspaper, until 10 October.  I also accept that the defendant, at that time, was not in a position to decide whether or not it should apply to re-open its case.  Dr Collins was then in the middle of his submissions before me in Mildura.  The question, whether an application to re-open the defendant’s case should be made, required careful consideration.

1. In the context of this case, the most important considerations are, first, whether the evidence sought to be adduced from Mr O’Neill would be relevant and admissible, and, secondly, whether the disadvantages, of permitting such evidence to be introduced, would outweigh any purpose to be served in admitting it. 

1. The first question, concerns the relevance of the evidence which is sought to be adduced from Mr O’Neill.  At this stage, the defendant does not know what Mr O’Neill might say in evidence, if he was asked to reveal what person or persons told him of the matters contained in the article.  If, for the purposes of this ruling, I were to assume that Mr O’Neill would be prepared to answer that question (a matter to which I shall refer below), and if, in doing so, he stated that one of the plaintiffs was responsible for disclosing to him the confidential information, the question arises whether that evidence would be relevant to the issue of damages.  As I stated, Dr Collins submitted that, if Mr O’Neill gave that question, the defendant would invite the court to infer that the plaintiff, in question, had disclosed the confidential material to the journalist in an attempt to interfere with the course of justice.  Alternatively, Dr Collins submitted that the proof of that fact would be the foundation for an inference that the proceeding had been brought by that plaintiff for some ulterior purpose. 

1. Pausing there, if, hypothetically, the journalist did state, in evidence, that a plaintiff had disclosed to him the confidential communications referred to in the article, it is, I consider, most doubtful, to say the least, whether the proof of that fact would be a sufficient foundation for either of the inferences on which the defendant would seek to rely.  Each of those two inferences would involve the court drawing a conclusion of serious misconduct by a plaintiff.  The principles, stated by the High Court in Brigginshaw v Brigginshaw[4], would apply.  If in fact it were established that a plaintiff had disclosed the confidential information to the journalist, a number of other competing inferences spring readily to mind.  Those factors would pose a difficult barrier in the path of the defendant being able to establish, on the balance of probabilities, that the motive of a plaintiff, in disclosing the confidential information to the journalist, was that alleged by the defendant. 

   [4](1938) 60 CLR 336, 343-4, 354, 362-3.

1. Thus, if I were to accede to the defendant’s application to re-open the case, and if the defendant were to adduce the evidence from the journalist that a plaintiff had divulged the confidential information to it, that evidence would, at best, have only limited probative value, on the issue of damages.

1. On the other hand, there would be a number of disadvantages in permitting the defendant to re-open its case and seek to adduce that evidence. First, of course, such a course may be an entire waste of time. I would expect that, properly advised, the journalist may well, if asked to reveal his sources, rely on the privilege against self-incrimination prescribed by s 128 of the Evidence Act 2008.  Further, of course, it is notorious that journalists are reluctant to divulge their sources.  Although the “newspaper rule” is, generally, confined in its application to interlocutory proceedings[5], I would be reluctant to insist on the journalist being required to disclose his sources at this stage, unless there was a legitimate cogent forensic value in doing so.  As I have stated, if the journalist did disclose his source, and if that source was a plaintiff, such a fact would, in my view, have, at best, limited probative value on the issue of damages.

   [5]John Fairfax & Sons Ltd v Cojuangco (1988) 165 CLR 346, 354-6.

1. The second factor, which concerns me substantially, is the potentially prejudicial nature of the evidence, which Dr Collins seeks to adduce by calling the journalist at this stage.  It would, I apprehend, be difficult to elicit from the journalist the simple fact as to who was the source of the article in question, without, in some way, adverting to the nature and substance of the article.  Indeed, as I stated to Dr Collins, by doing so, there may be revealed to the court not only the fact that certain offers have been made, but the fact of who made the offer.  In that respect, as I have already remarked in court, the disclosure of that type of information, in evidence, would not, from a subjective point of view, influence my decision in any way.  However, that is not the point.  It is most important that the parties, and the community, have complete confidence in our system of justice, and in the integrity of the decision making process undertaken by juries and judges.  This case was of substantial general interest to the community of Mildura.  The closure of the First Mildura Irrigation Trust in 2008 excited strong and quite emotional debate in the Mildura community.  Witnesses in the case gave evidence that that debate, and the controversy concerning the closure of the Trust, is still ongoing.  In that way, not only the parties, but also the Mildura community, have the right to expect that any decision, which I make, should not be affected or influenced in any way by the communication to me of matters such as those which, apparently, appeared in the newspaper.  To borrow the dictum of Young CJ in Skafidas v ATM Industries Pty Ltd[6], “ … if the information is disclosed to the court it may not thereafter appear that justice has been seen to be done”. 

   [6][1979] VR 164, 166.

1. In addition to those matters, there are other considerations, which militate against the application made by the defendant.  First, as I have noted, the journalist may refuse to answer any question relating to his sources, either on the basis of the privilege against self-incrimination, or, because, as a journalist, he does not wish to reveal his sources.  If the journalist does reveal his source, and if he thereby implicates a plaintiff as that source, the matter may not end there.  For example, the particular plaintiff may wish to dispute the evidence of the journalist.  Alternatively, the plaintiff may wish to call evidence explaining why the material was divulged to the journalist.  In this context, it is relevant that the article appeared on the day after Dr Collins, in his submissions, had contended that, if the plaintiffs had brought their claim for damages in the United Kingdoms, it would have been liable to be struck out as an abuse of the process of the court.  It is not difficult to envisage how an explanation, based on that submission by Dr Collins, may be sought to be used, by that plaintiff, not only as an explanation for the disclosure of the information to the journalist, but, also, on the issue of the aggravation of damages. 

1. There are other difficulties, which might emerge, if I were to permit the defendant, at this stage, to adduce evidence from the journalist as to his source.  For example, if the journalist gave evidence, implicating a plaintiff, that evidence may not necessarily prove that the information, given to the journalist, was in fact privileged.  In such a case, to establish that fact, the defendant might need to prove, in evidence, the privileged communications.  The prejudicial effect of such a course is obvious.  Further, again, depending on the nature of the question asked, and the answer given, the defendant might, by adducing evidence from the journalist, waive the privilege which it had in the communications.  This case involves four proceedings.  Questions and difficulties may then arise, particularly if any of the plaintiffs responded by waiving his or her privilege in the communications. 

1. The matters, to which I have referred, are just some of the difficulties which may arise, if I were to permit the defendant to re-open its case, and to call the journalist.

1. In summary, it is clear that if the evidence were to be adduced, it would have, at best, limited probative value. On the other hand, it would be likely to be unfairly prejudicial to the proceeding. In addition, the adducing of that evidence may well cause or result in undue waste of time. In those circumstances, a real question may arise as to the admissibility of that evidence under s 135 of the Evidence Act.  Further, even if I were to admit the evidence, there would be a number of considerable disadvantages, to which I have referred. 

1. Ultimately, it is most important that the integrity of the judicial process is preserved.  The requirement, that justice is seen to be done, is of some moment in the context of the background facts of this case.  That reason, alone, would, I consider, outweigh any value to the defendant in adducing the evidence which it seeks to elicit from the journalist.  However, the other matters, to which I have referred, add greater weight to that consideration.  In the end, the defendant has failed to persuade me that the circumstances are such that I should accede to its application to re-open its case, and to call the journalist to give evidence, at this stage. 

1. For those reasons, I refuse the application of the defendant, in each of the four actions, to re-open its case, and to call the journalist to give evidence.

1. I emphasise, again, that that conclusion does not detract from the observations, which I have now twice made in court, namely, that if the article did contain information about confidential, without prejudice communications to the parties, it is a serious matter.  I can well understand the defendant being sincerely aggrieved by the publication of those matters in the newspaper, particularly on the last day of the hearing before me.  I reiterate, again, that it is most important that newspapers, and all media outlets, respect, and rigidly adhere to, the fundamental principle that confidential, without prejudice communications, or any privileged communications, should not be the subject of public disclosure.