Boland v Dillon; Cush v Dillon

[2010] HCATrans 333

[2010] HCATrans 333

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S177 of 2010

B e t w e e n -

LESLIE FRANCIS BOLAND

Applicant

and

MERYL LURLINE DILLON

Respondent

Office of the Registry
  Sydney  No S178 of 2010

B e t w e e n -

AMANDA CUSH

Applicant

and

MERYL LURLINE DILLON

Respondent

Applications for special leave to appeal

GUMMOW J
HAYNE J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 10 DECEMBER 2010, AT 9.53 AM

Copyright in the High Court of Australia

__________________

MR T.A. ALEXIS, SC:   May it please the Court, I appear with my learned friend, MR P.M. SIBTAIN, for each of the applicants.  (instructed by Cole & Butler Solicitors)

MR R.G. McHUGH, SC:   May it please the Court, I appear with my learned friend, MR D.A. HUGHES, for the respondent.  (instructed by Banki Haddock Fiora)

GUMMOW J:   Yes, Mr Alexis.

MR ALEXIS:   Your Honours, the application raises two issues.  One is whether the defence of qualified privilege at common law can be engaged by a publisher, that publisher having denied publication of the defamatory statement in evidence before the jury, the jury then having found publication and the meaning in favour of the plaintiff, so as to avoid liability for those imputations.  Both the primary judge and the New South Wales Court of Appeal proceeded on the basis that notwithstanding those circumstances, the defence of qualified privilege was still available.

The other matter is whether a statement made by a director to a chairman of a board that publishes the existence of a rumour or an allegation as a fact and thereby conveys defamatory imputations can be published on an occasion of qualified privilege.  There is a related question to that and that is whether or not the voluntary nature and character of the defamatory statement made in this case should have been decisive against the finding of qualified privilege.  That brings into focus the current status of the dissenting judgment of Justice McHugh in Bashford v Information Australia (Newsletters) Pty Limited.

GUMMOW J:   It is a dissenting judgment.

MR ALEXIS:   It is and ‑ ‑ ‑

GUMMOW J:   There it is.  It is up to them really.

MR ALEXIS:   The Court of Appeal, in our submission, has seemingly regarded his Honour’s dissenting judgment nonetheless as one that ought to be followed because it is described in, for example, the decision of Bennette as one where his Honour simply dissented in the result.  May I deal with each of those matters in that order.  Could I start by taking your Honours to page 95 of the book where on one page your Honours will have firstly the jury’s finding as to the publication of the defamatory matter at lines 5 and 6 in the bold type?  Your Honours will then see the imputations that were found by the jury, firstly with respect to Mr Boland in paragraph 6 from line 13 and following:

(a)that as a member of the Board of the CMA, he was acting unprofessionally by having an affair with the General Manager of that organization; and

(b)that he was unfaithful to his wife.

The defamatory imputations concerning Ms Cush, who was then the general manager of the statutory authority, were:

(a)that as the General Manager of the CMA, she was acting unprofessionally by having an affair with a member of the Board of that organization; and

(b)that she was undermining the marriage of Mr Boland and his [then] wife.

Importantly, your Honours see in paragraph 8 the fact that at the trial on the issue of publication and meaning before the jury the respondent denied in her evidence publication and not just that, as the question and answer at the foot of the page indicates, there was a denial of publication and anything like that in terms of the conversation that was relied upon.  Our fundamental proposition is that the ‑ ‑ ‑

GUMMOW J:   Wait just a minute.  What then do you say as to Mr McHugh’s point at paragraphs 9 and 10 on page 107?

MR ALEXIS:   Which relies upon the ‑ ‑ ‑

GUMMOW J:   As to pleading in the alternative?

MR ALEXIS:   This is not a pleading point, is our submission.

GUMMOW J:   What then is it?

MR ALEXIS:   Well, it is a point concerning the availability of the defence once the publisher denies making the publication and subsequently accepting the finding of the jury, with respect, is meaningless in terms of then applying the defence of qualified privilege because the essential proposition upon which a defence of qualified privilege is founded is a confession of or an admission with respect to the publication and, importantly, the defamatory imputations, and that did not occur here.  By reason of that, in our submission, the defence of qualified privilege was not available.

Could I take your Honours to firstly what Justice McHugh said in Bashford v Information Australia (2004) 218 CLR 366 at page 387. At paragraph 58 your Honours will see that his Honour referred, at the foot of the page, to the nature of the plea of qualified privilege with respect to defamatory matter:

a plea of confession and avoidance.  It accepts that the communication is defamatory, that the defamatory matter may be false and that its publication has caused or may cause harm to the plaintiff.  It confesses the publication of defamatory matter, but contends that the publication is immune from liability because the public interest requires that the duty and interest of the publisher and recipient should be preferred to the protection of the plaintiff’s reputation.

Your Honour Justice Gummow similarly, we would say, at page 415 at paragraph 135 of your Honour’s judgment, in similar terms, about halfway through that paragraph, said that:

The defence of qualified privilege is a plea in confession and, as such, is predicated upon the existence of a defamatory imputation to which the privilege attaches.

The Court of Appeal, her Honour Justice Bergin, with whom his Honour the President and Justice Tobias agreed, dealt with this issue by simply recording that the respondent had specifically accepted in her subsequent evidence before the trial judge who determined defences the jury’s finding.  Your Honours will find that in the book at page 49 where paragraph 38 of the primary judge’s judgment is reproduced from about line 28.  Your Honours see the reference there to:

The version of the conversation Mrs Dillon says she had with Mr Croft in relation to the affair is different to that found by the jury.  Mrs Dillon specifically accepted the jury’s finding in her evidence before me.  I will obviously proceed on the basis of the jury’s finding.

What then occurred, your Honours, is that the Court of Appeal proceeded to superimpose the jury’s finding over the respondent’s evidence concerning the occasion of the publication so that, when coming to scrutinise the circumstances, to determine if the publication occurred on a privileged occasion.  The difficulty with that approach, of course, is that it completely overlooked the significance of the respondent’s denial of the earlier publication.

HAYNE J:   What is that significance?

MR ALEXIS:   The significance is that in the absence of a confession or an admission of the defamatory publication the defence of qualified privilege could not be engaged.

HAYNE J:   Why?

MR ALEXIS:   Because having denied ‑ ‑ ‑

HAYNE J:   With a two stage trial where the facts are found by the jury, what does it matter that at an earlier stage of the proceeding certain evidence was given which the jury rejected?  What does it matter?

MR ALEXIS:   Well, because in order to run a qualified privilege defence there has to be an acceptance of or a confession to the publication and defamatory imputations.

HAYNE J:   If that is not an argument founded on there not being alternative pleas available, what is its content?  You say the defence is “not available”.  What do you mean by that?

MR ALEXIS:   If the trial was not separated pursuant to section 7A and we had this trial conducted pursuant to the current section 22, at the end of the evidence the pleaded claim to qualified privilege would be taken away from the jury because if the publisher denied publication, it could not then be a matter left to the jury to determine whether or not the publication which was the subject of the denial was published on an occasion of privilege.  The fact that this was a separate trial, in our respectful submission, should not matter as a matter of principle why ‑ ‑ ‑

HAYNE J:   But the underlying proposition seems to be that in a jury trial you cannot put questions to a jury that would require consideration of alternative cases.  That is a surprising proposition.

MR ALEXIS:   Well, your Honour, in circumstances where the publication is not just the subject of a question of whether or not the plaintiff has discharged an onus but where the publication is the subject of an expressed denial on oath, in those circumstances a trial judge would not leave a defence of qualified privilege as an alternative to the jury because of the inconsistent evidence, and that is our proposition.  Having regard to the way the case ran below, the defence was not available. 

The illogical dilemma, as we describe it in our written submissions, of asserting a reciprocal duty and interest for a publication the respondent denied making gives rise to the second aspect of the application.  Could I develop that by starting at page 34 of the application book and draw firstly attention to the way Justice Bergin defined the impugned publication your Honours have.  At line 20 on page 34 your Honours will see that her Honour denied the publication:

it was “common knowledge among people in the CMA that Les and Amanda are having an affair” –

as the statement.  We contrast that with her Honour’s treatment of the qualified privilege defence at pages 56 and 57 of the application book.  If I could invite your Honours to firstly look at the finding that was made with respect to the defence of qualified privilege in paragraphs 53 and 54.  Your Honours will observe her Honour’s reference to:

53I am of the view that the existence of the rumour that the Respondents were having an affair was relevant and sufficiently connected to the privileged occasion as to attract the defence of qualified privilege at common law.

54I am satisfied that the trial judge fell into error in failing to find that the publication of the “rumour” to Mr Croft was an occasion that attracted the defence of qualified privilege.

GUMMOW J:   It is said against you that this is all just a question of fact.

MR ALEXIS:   With respect, in our submission, it is a question of law and that, in our submission, is made plain in the joint judgment of his Honour the Chief Justice, your Honour Justice Hayne and your Honour Justice Heydon in Bashford at page 377 where his Honour and your Honours said, at paragraph 22 in about the middle of that paragraph:

In a trial of all issues in a defamation action by judge and jury, the question whether the occasion is privileged is a question of law for the judge; the question whether the occasion was used for the purpose of the privilege is a question of fact for the jury.

In our respectful submission, in determining this question of law the Court of Appeal fundamentally overlooked what the articulated duty is, and that is plain when your Honours look at page 56 of the book at about line 60 because there your Honours will see a repeated reference to the rumour:

The rumour of the affair was intrinsically intertwined with the concerns the Appellant raised with Mr Croft . . . That a Regional Director of the Department had become aware of the rumour was a new dimension to its existence, elevating it to an importance that imposed a duty on the Appellant to convey its existence to the Chairperson.  Equally the Chairperson had a reciprocal interest in receiving the information.

I interpolate there, information concerning the existence of the rumour.  Now, once one sees clearly that that is the duty or the interest that was articulated, one can see immediately that their Honours overlooked the fact that what was published was not the rumour but the fact. The respondent did not publish the existence of the rumour or the existence of an allegation or that there were words circulating about it.  What the respondent did was publish the rumour as a fact.

So, in our submission, there could be no reciprocity of duty, be it legal, moral or social, in publishing a statement that the applicants were having an affair and that it was common knowledge when, as the respondent well knew at the time, there was only a rumour.  The related issue, your Honours, concerns the voluntary nature of the defamatory statement and this arises in this case because the primary judge ‑ ‑ ‑

GUMMOW J:   Is this ground 3?

MR ALEXIS:   Yes, it is, your Honour.  It arises in this case because the primary judge rejected the respondent’s evidence that sought to explain why she published the defamatory matter to the chairman when she did.  The background, in short, was that she had known of the existence of the rumour from employees for about three months.  She spoke to the chairman shortly after she had had a conversation with the regional director of the relevant department.  Now, his Honour the primary judge rejected that as the reason.  Could I just show your Honours what his Honour the primary judge said about that at application book page 8, paragraph 37 at line 58.  His Honour said that he was not satisfied that Mr Hart –

that is the relevant regional director –

raised the affair as a matter of concern.  As a result I am not satisfied that Mrs Dillon disclosed the rumour to Mr Croft as a result of her conversation with Mr Hart. 

So what follows, in our submission, is that the defamatory statement that was made was entirely voluntary in nature and that should have been a decisive factor against the finding of a privilege occasion.  Our submission is that the Court of Appeal should have followed what Justice McHugh said in Bashford. I should take your Honours to that passage at page 395. In paragraph 77 Justice McHugh said that:

the fact that the defendant has volunteered defamatory matter is likely to be decisive against a finding of qualified privilege.

Now, if we put that submission, notwithstanding that his Honour was in dissent and, as I said earlier to your Honour Justice Gummow, his Honour, in our submission ‑ ‑ ‑

GUMMOW J:   What happened in those cases in footnote (129), do you know?

MR ALEXIS:   I am not sure that I am able to assist your Honour with that just at the moment.

GUMMOW J:   Pretty old.

MR ALEXIS:   But, your Honours, as I indicated earlier, although Justice McHugh was in dissent, our submission is and would be on appeal that it was only as to the facts or on the outcome.  Also, the Court of Appeal seems to have consistently applied Justice McHugh’s judgment, notwithstanding that it was in dissent, in other decisions of that court, principally Lindholdt v Hyer and Bennette v Cohen.  May I observe that your Honour Justice Heydon in the recent case of Aktas v Westpac ‑ ‑ ‑

HEYDON J:   Another dissenting judgment.

MR ALEXIS:  Yes, another dissenting judgment, but your Honour observed in [2010] HCA 25 at paragraph 73 that “No detailed argument was directed to the status of McHugh J’s” judgment in Bashford and, with respect, that is a question that does arise for consideration here.  So, in our submission, there are issues of general importance arising on both aspects ‑ ‑ ‑

GUMMOW J:   Just before you go on, looking at the judgment of the Court of Appeal on page 63, paragraph 68, do you quarrel with the statement made there as a principle?

MR ALEXIS:   Could I ask your Honour to just repeat the paragraph?

GUMMOW J:   It is paragraph 68 on page 63:

It is the motive or purpose for which the occasion is used that is ultimately decisive, not the defendant’s belief in the truth of the matter” . . . Accordingly “neither lack of honest belief nor knowledge of the falsity ipso facto destroys a defence of qualified privilege”.

Do you say her Honour erred in that?

MR ALEXIS:   Yes. 

GUMMOW J:   How is that reflected in your proposed grounds of appeal?

MR ALEXIS:   Your Honour, the focus is very much on the two principal special leave questions, but it certainly is a significant part of the second of the two when one has regard to our primary point that there was a publication not of a rumour but of a fact.  So, in our submission, the two broad aspects of the application both have general importance.  The judgment of the Court of Appeal, of course, permits a publisher to rely upon a defence of qualified privilege in the unusual circumstances that we have referred to. 

There is also the problem of a duty and interest arising because of rumour and allegation being used to protect the publication of the fact and liability for defamation with respect to that fact and, of course, what occurred on the facts of this case – your Honour, we would respectfully submit that the facts of this case are common place and would be routine experience and occurrence in board rooms and board situations around the country every day.  For that reason it is a matter of general importance.  Comment is made in our ‑ ‑ ‑

GUMMOW J:   You are talking through a red light you know?

MR ALEXIS:   I will be very quick, your Honour.  Comment is made in our learned friend’s submissions that we had smaller verdicts and that is clearly so.  Costs are significant in this matter.  We received indemnity costs at the trial.  Of course, the orders of the Court of Appeal are that the matter be remitted for a retrial and clearly we wish to avoid that circumstance.  If your Honours please.

GUMMOW J:   Yes, Mr McHugh.

MR McHUGH:   Your Honours, those lights are rather subtle.  The first point is the question of denial.  Now, there are two ways this point could arise as a matter of principle.  It could either be a pleading point, which is the language in Bashford, both in your Honour Justice Gummow’s judgment and in Justice McHugh’s judgment.  If it is a pleading point, then there is no problem in pleading in the alternative.  If it is a point of doctrine about the nature of the defence, then it must be wrong as a matter of principle to say that it is necessary to confess before there can be an occasion of privilege. 

The defence operates on the circumstances as they are objectively determined and those include, as your Honour Justice Hayne, I think was putting to my friend, the findings of the jury that are made as to what was published, that there is no matter of doctrine or principle at all, no authority that my friend can advance in support of a proposition that it is necessary to confess or admit in order for there to be a defence of qualified privilege.  That is my friend’s first point as a matter of principle and it also runs into the practical difficulty that it does not arise in this case because at the second trial my client accepted the jury’s verdict.  So there is no contradictory position at that point.

My friend’s second point is in relation to rumour and the distinction between rumour and fact.  That is ultimately a question in the nature of fact.  My friend points to Bashford and says, well, there is an allocation at a jury trial of that question between the trial judge and the jury, but ultimately it is a fact specific determination.  What happened in this case is the Court of Appeal held that there was a duty in my client to disclose the existence of the rumour to Mr Croft, the chairman, but that is a finding of fact as to duty, which does not appear to be challenged in this Court.  The Court of Appeal then held that there was an occasion of privilege arising out of that, and again that in itself does not appear to be challenged in this Court except on the voluntariness and the denial basis, but as far as it goes, it is not challenged in this Court.

The question whether what was actually spoken was published on that occasion is a fact specific determination and my friend’s complaint is that the Court of Appeal did not determine the question, but that is one of the questions which has been remitted to the trial judge.  The court did not remit only the question of malice.  It did not find that there was an occasion of qualified privilege upon which these words were spoken and published, subject to defeasance by malice, the Court of Appeal remitted the whole question of the defence of qualified privilege.  So that question whether or not the words found by the jury were published on an occasion of qualified

privilege has been remitted and this Court will not have the benefit of any primary findings because neither the Court of Appeal nor the first instance judge dealt with it.  It is, as I say, an entirely fact specific question that involves no issue of general principle of any description. 

My friend’s third point is voluntariness and the real reason why this issue simply does not arise is that because the Court of Appeal found that there was a duty to publish all of the principles in Justice McHugh’s judgment can be accepted, for present purposes, they are simply not engaged because it was a publication pursuant to a duty on any view, whether or not those principles are correct.  So it is not a question which in any sense can arise in this Court.  Given that the inquiry that the Court will be asked to undertake, if there is a full appeal, will be entirely fact specific, will not involve any question of general principle and given the colossal amount of money that has been spent in this litigation so far, over two publications, each to one person – I should say one publication in relation to two plaintiffs to one person and in each case damages of $5,000 certainly, as a matter of discretion, that this Court should not permit in what amounts to an exercise of a visitorial jurisdiction, this litigation to continue in this Court.

The real problem with my friend’s point is if he does not win in this Court, we have to have a retrial anyway on the question of malice.  That brings me to the very last question your Honour the presiding judge raised with my friend, whether the principles in Roberts v Bass as to malice were under challenge.  The first that any of us heard of that was my friend’s affirmative answer to your Honour’s question.  On the notice of appeal that has been filed in draft there is not a single question about malice raised.  That is one of the issues that has been remitted to the trial judge, but until my friend said that, I had not any understanding that that was one of his points in this Court. 

The reason why it is a point which cannot succeed in this Court is that the principles in Roberts v Bass have been well and truly accepted.  They have been worked through in the New South Wales Court of Appeal in the decision of Gross v Weston.  There is no unresolved issue that needs attention in relation to malice at all.  So unless there is anything further with which I can assist your Honours, those are the submissions of the respondent.

GUMMOW J:   Thank you, Mr McHugh.  Yes, Mr Alexis, what do you say as to the proposition put by Mr McHugh that we would be taking a half baked dispute in the sense that there would be issues that would have to go back anyway?

MR ALEXIS:   Not at all, is our responding submission, and simply for this reason.  The order remitting it is to remit the defence of qualified privilege at common law, but, of course, the primary judge to whom the matter would be remitted will be bound by the findings of the Court of Appeal at paragraphs 53 and 54 which find against us the occasion of privilege.

GUMMOW J:   Paragraphs 53 and 54?

MR ALEXIS:   Yes.  The holding of the Court of Appeal at book page 57, paragraphs 53 and 54 will close the issue.  So the only matter in substance that has been remitted is whether or not that finding should be defeated by malice.

HAYNE J:   That is a proposition that equates rumour and fact, is it not, which is, I thought, to the contrary of your ground 2?  Your ground 2 seeks to distinguish, it seems with some force, between the notion of rumour and fact.  You say that 53 and 54, cast as they are in respect of rumour only, somehow bind the trial judge in what way?

MR ALEXIS:   Well, the Court of Appeal has found that having articulated the duty as one to inform the existence of a rumour, having published within that duty or in performance of that duty the fact, the defamatory imputations arising from the publication of that fact are protected within the occasion.  So that means that any submission back to the primary judge that says that what was published was fact not rumour could not be relied upon to defeat the holding of the Court of Appeal on malice because of the way in which the Court of Appeal determined the existence of the occasion and the duty, importantly.  So that is why we say that although the defence of qualified privilege has been remitted in substance and in truth, the retrial will be a retrial about malice.  If the Court pleases.

GUMMOW J:   We will take a short adjournment.

AT 10.23 AM SHORT ADJOURNMENT

UPON RESUMING AT 10.27 AM:

GUMMOW J:   There will be a grant of special leave in this matter but limited to the second and third and excluding the first of the three grounds that have been referred to this morning and the draft notice of appeal will have to be adjusted accordingly.  It will be a one‑day case I would think.  The notice of appeal should be filed as soon as possible and the Registrar, as I have indicated earlier, will be in contact with the solicitors to get organised the transition under the new rules and the progression of the matter to a hearing, which may be in the March/April sittings.

AT 10.28 AM THE MATTER WAS CONCLUDED