Chakravarti v Advertiser Newspapers Ltd - [1997] HCATrans 235

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Adelaide No A41 of 1996

B e t w e e n -
MANOBENDRO CHAKRAVARTI
Appellant
and
ADVERTISER NEWSPAPERS LIMITED

Respondent

BRENNAN CJ
GAUDRON J
McHUGH J
GUMMOW J
KIRBY J

TRANSCRIPT OF PROCEEDINGS

AT ADELAIDE ON TUESDAY, 2 SEPTEMBER 1997, AT 10.04 AM

(Continued from 1/9/97)

BRENNAN CJ: Mr Gray.

MR GRAY: Could I shortly address the matter your Honour the Chief Justice pointed up about the words in brackets appearing in the first of the letters. It is at page 862 of volume 4. The proviso to section 7 speaks of:

a reasonable letter.....by way of contradiction or explanation of such report.

When one looks at the first article and looks at the way that it is presented, the first article presents the matter in at least two ways. It presents what Mr Simmons said to Mr Bannon, so part of it is Mr Simmons’ reporting to the royal commissioner what he had told Mr Bannon, but there are a number of instances of Mr Simmons directly answering Mr Jacobs’ questions, for example, in the third, fourth and fifth columns where Mr Jacobs puts questions to Mr Simmons and Mr Simmons responds, in particular when he is dealing with matters of difference of opinion with the board.

So that from Mr Chakravarti’s point of view he faced an article that he said was wrong in at least three aspects: first of all, it was wrong in regard to the underlying allegations of fact that he had been involved in some form of misconduct; secondly, when it was suggesting that Mr Simmons had reported to Mr Jacobs that he had implicated Mr Chakravarti to the Premier; thirdly, in so far as Mr Simmons answered questions directly to the royal commissioner, he is saying it is wrong in that Mr Simmons did not implicate Mr Chakravarti when he was directly answering Mr Jacobs’ questions.

So the letter of contradiction or explanation needed to go to all three matters to fairly put Mr Chakravarti’s position, because Mr Chakravarti had spoken to the solicitor, had been and viewed the transcript and his belief was, as he stated in his letter, that Mr Simmons had not named him in regard to these matters, had not named in either to Mr Bannon or when he reported it through to Mr Jacobs or directly to Mr Jacobs. That is the explanation for what appears in the brackets, that he was seeking to deal directly with the matters to the royal commissioner. In the circumstances it was justified, in particular, taking an example, in the third column, the second paragraph, it reports:

Mr Jacobs: “The fact was, to put it in its blandest form, there had been a difference of opinion between the board and these officers as to their conduct.”
Mr Simmons: “Yes.”

When one goes back to the evidence it is very clear that Mr Jacobs was referring only to Baker and Reichert, whereas the way it is put in this article it is a reference to the four. That was Mr Chakravarti’s complaint: “You have reported this as though Mr Simmons was telling the royal commissioner that I was involved.” But if you go to the transcript he is not saying that. Could I make that point good, if the Court pleases, by reference to the transcript. Just to explain what had happened ‑ ‑ ‑

BRENNAN CJ: I think that point has already been made. I am afraid my difficulties are a somewhat difference one, and it is this, that the statute operates upon the hypothesis of a fair and accurate report So that absent fairness or accuracy in the report the section simply does not apply. So that if one is given a fair and accurate report then there is no occasion for any letter objecting to the fairness or accuracy of the report. So if the letter contains an attack upon the fairness or accuracy of the report, that is not the kind of response to which the subsection then applies.

MR GRAY: Yes. If the Court pleases, we would say that in a circumstance where there is going to be a debate about the fairness and accuracy of a report, it is not unreasonable for the letter of explanation or contradiction to make that clear.

BRENNAN CJ: Yes, that may be so.

MR GRAY: The press is well able to protect itself by rejoinder. It does not make it unreasonable for a person to protect themselves by saying, “I do not say this is fair and accurate but if it is, here is my explanation.” In other words, he should not be bound to have to accept the fairness and accuracy in his letter, he should be able to protect himself by that reservation, and that is all he has done.

BRENNAN CJ: Take a starker example in this: let us assume that the article had stopped at the point where the question and answer which was under challenge had been reported and reported accurately according to the reporter’s recollection of the answer “Yes” being given; let us assume that the letter then contained that third paragraph. Would the newspaper be required, in order to gain the advantage of a protection of the section, to print the letter contradicting the truth of what the reporter had heard?

MR GRAY: If the circumstance was that there might fairly be a difference of opinion about whether the answer was given or not and the newspaper was faced with Mr Chakravarti saying, “I believe an answer was not given”, then that should be published. All he has spoken of is his belief, he has not asserted it is a categoric fact, he has stopped short of that. If the newspaper editor is faced with his report on the one hand asserting an answer was given, on the other hand recognising that there was possibly another view and was faced with a letter which said, “In my belief the other view is correct,” then there would be no occasion for the newspaper not to publish.

If on the other hand Mr Chakravarti was asserting there was no answer categorically that might be a different case. But here the words are simply “I believe,” and that was true; plainly, that statement was true. The statement in the letter was a true and accurate statement that was Mr Chakravarti’s belief. One could go further and say in this case it was a reasonable belief, and one can go further still and say that any independent observer of the facts would view that as a reasonable belief on that day. That is why we say we have this particular letter - move away from your Honour’s starker example - we have this particular letter; this letter was reasonable in the circumstances. I do not know that I can further advance that point.

Your Honour Justice Gaudron raised a question about the Canadian case of Nowlan. I think copies have been made available; we have had that copy extracted overnight. On the point of the reasonable letter, the Canadian statute in question is essentially in the same terms. It is at the foot of page 808 that one finds it set out, section 3(2) of the Libel Act. Ultimately the court finds the letter was not reasonable; but it is purely a matter of fact in the circumstances and it does not help in regard to points of principle.

What had happened there was that there had been a report to a health board about some bacteria in milk, and the reporting sanitary engineer had reported of an incidence over a discrete period of time, and the letter in response sought to speak of the statistics over a longer period of time and in a sense water down the effect of the gravamen of the incidence, and it was held it was unreasonable to do that because it would be misleading. The fact of it was there was a significance over a discrete and temporary period and to offer a letter of explanation saying, but over a longer period one sees the incidence to be less significant was not, the Canadian court thought, to be reasonable.

The second aspect of it was that the letter went on to say that Mr Nowlan had always carried out every requirement of the sanitary engineer. But when goes to the report itself, the report itself did not complain or defame him by saying he did not attend to requests. So, as a matter of fact, the Canadian court, both at first instance and on appeal, held that the letter was unreasonable. So the case does not help on the points of principle, it is simply a factual application on discrete facts; but the authority is provided as being one of the two authorities that we can find touching the point.

KIRBY J: Have you found any authority where it was found to be reasonable?

MR GRAY: No, none that we can find.

KIRBY J: It does not seem as though this statutory provision has had a lot to do.

MR GRAY: No, not as far as the courts are concerned. Your Honour Justice Gummow made an inquiry about the reports of the decisions below. The decision of Justice Cox is reported. It is 181 Law Society Judgment Schemes page 218. Your Honour Justice McHugh, in the discussion concerning Polly Pec,k referred to a case of McGrath v Black. We would say that that case does not really help in regard to the current debate. That was really a case about a warning to a plaintiff: “If you plead your false innuendo or your innuendo too widely, then you might draw a very wide case on justification.” It was really a warning about plaintiffs who seek to go too broadly in their plea, and as such we say that discussion is not really helpful in regard to the case at bar.

In regard to Polly Peck can I just, having reflected the matter overnight, put this submission to your Honours. In a statutory scheme such as New South Wales where the plaintiff must plead and is bound by each and every imputation or meaning he puts forward, and the defendant then has to face that and no other case, then there really is no occasion for allowing the defence to plead some other imputation to justify that; it is simply not relevant. Either the plaintiff fails or succeeds on the pleaded imputation, and the defendant either justifies, if it wishes to, the imputation as pleaded. The occasion does not arise for the Polly Peck position at all; it just has no work to do at all. If one leaves the statutory regime and goes simply to common law regimes, one finds consistently that there, in the case of natural and ordinary meaning, there is no obligation on the plaintiff to do other than set out the words. That is the obligation of the ‑ ‑ ‑

McHUGH J: I am not sure that Lord Devlin was prepared to go that far in Lewis v Daily Telegraph. He did not decide it but everything he said was in favour of a requirement that it should be pleaded.

MR GRAY: Yes. Certainly that does not accord with the practice of the various courts in the other States of Australia, the United Kingdom or Canada; there is not a requirement to plead the false innuendo.

McHUGH J: That may be because people just do it automatically these days. I mean, in the last 25 years I cannot recollect seeing any reported case of defamation where a plaintiff has not pleaded a false innuendo.

MR GRAY: We would accept it has become common practice.

GUMMOW J: What Lord Devlin said, page 282 of 1964 Appeal Cases, was that it was distinct meanings that should be pleaded. You do not cavil with that, do you?

MR GRAY: If the ‑ ‑ ‑

GUMMOW J: The reason he advanced was bound up with justification.

MR GRAY: We would say that if one is putting a case simply that these words are defamatory as one reads them, the plaintiff is able to simply rely on the words and not ascribe any meaning. If, on the other hand, there is something special then he must plead it and it becomes a true innuendo. There must be something ‑ ‑ ‑

McHUGH J: As Justice Gummow put to you yesterday - and Lord Devlin supports this in Lewis - that the real test as to what meaning you can rely on is whether or not it would require a different defence of justification. So if you have a meaning which would - you can rely on any meaning that a defence of justification to your pleaded meaning would cover; but if you have got to rely on - or if the defendant would have to plead other facts, then you cannot.

MR GRAY: Yes, but the difficulty that the Court faces when the obligation on the plaintiff is just to, and no more than, set out the words in a natural and ordinary meaning case, and the defendant faces a possible range of imputations from the most serious to the lesser, then the Court took the view that it was only fair to allow the defence the opportunity to identify what imputation they said did arise and justify it if they wished. So the rationale of Polly Peck was one of procedural fairness arising in an environment where the plaintiff did not have to plead false innuendos.

McHUGH J: Yes, but unfortunately the plaintiff had pleaded an innuendo in Polly Peck, and what the Court did was allow the defendant to justify another innuendo which the plaintiff had not pleaded.

MR GRAY: But that was because there was a risk from the defendant’s point of view that the Court might find some other imputation than that pleaded by the plaintiff. So to protect the defendant against that possibility one has the Polly Peck ‑ ‑ ‑

McHUGH J: If you had applied Lord Devlin’s test the question would never have arisen.

MR GRAY: With respect, that does not, we would say, represent the common law view and that ‑ ‑ ‑

GUMMOW J: It does not represent the view of the English Court of Appeal. It was certainly audacious of the English Court of Appeal, I would have thought, not to have mentioned Lord Devlin if it had been cited to them. One only assumes it was not cited to them.

MR GRAY: Yes. It certainly does not represent the position, for example, in Victoria where, in the case I took the Court to yesterday, that history is set out, and it is said in the plainest of terms that this is a very advantageous matter, the printing of false innuendo, because it helps the parties to come to the point. But the finders of fact remain in the position to say what they say it means regardless of what either party asserts to be the meaning. To put it another way, at the end of the day the finder of fact will look at the words and say what the ordinary meaning is and it will not be circumscribed by contentions of either party that it finds artificial.

McHUGH J: At this stage in the defamation practice of any jurisdiction I would have thought that if a plaintiff did not plead an innuendo that the high probability would be, except in a very clear case, that a court would hold that the fair trial of the action would be embarrassed and require the plaintiff to plead an innuendo, and then the plaintiff would be confined to that innuendo, or the substance of it, subject to any further application for the reader.

MR GRAY: Yes. With respect, as far as the Rules of the Supreme Court of South Australia are concerned, it is Rule 46.19 and it does not require the pleading of false innuendos. According to the rules of ‑ ‑ ‑

GUMMOW J: Have you got that the text of that rule in the material?

MR GRAY: I will have it obtained, if the Court pleases, and provide it.

McHUGH J: I take it that the South Australian Supreme Court has got a rule which enables a party to strike out a plea on the basis that it will prejudice the fair trial of the action.

MR GRAY: Yes, that will be within the - I do not know if it is specific, but it is certainly within the inherent jurisdiction of the Court. Obviously the Court can, to ensure procedural fairness, craft such orders as are appropriate, and we accept that. If the Court pleases, in terms of the conducting of this trial one would say this trial was conducted according to the procedure of the day, and the procedure of the day was, there is no need to plead a false innuendo; if you do, we say, on the wealth of authority, you are entitled to rely on a lesser meaning. Pritchard v Krantz, in the passage we have quoted from Chief Justice King, says just that. Chief Justice King does then go on to say, of course, there is the brake of procedural fairness that the Court can apply.

The point of coming back to this topic was to put the submission to the Court that the Polly Peck defence position is really only there because the courts are recognising that the plaintiff is not bound by the pleaded imputation. That is the rationale why it is there, and ‑ ‑ ‑

BRENNAN CJ: That must be so, must it not? If you start off with the proposition that a tort has been committed by the publication of specific words and the words are pleaded in a form which raises on the plaintiff’s part a cause of action, certainly, from that point onwards, it is all a matter of procedure, it has to be, otherwise procedure governs the substance.

MR GRAY: Yes. We respectfully adopt that and say that is the rationale behind Polly Peck; it is a procedural practical matter that has been done to effect procedural justice, given that starting point.

McHUGH J: I do not want to pursue this for much longer, but I just cannot follow where the question of procedural fairness comes in, except on the hypothesis that the jury and the plaintiff can depart substantially from the pleaded meaning.

MR GRAY: Yes. That is what causes the imbalance that led to Polly Peck, and it will not arise in New South Wales, for example, because the statutory scheme ‑ ‑ ‑

McHUGH J: But even on that hypothesis, you have got a case that somewhere out there the defendant says, “Well, that is the meaning and I am justifying it.” Nobody knows. The jury is never going to tell what it found, and the plaintiff is not alleging it, and the trial judge is not alleging it, and yet it is out there somewhere.

MR GRAY: But that is addressed specifically in the passage in the Victorian Full Court decision when the court there explains that at a practical level it just does not happen that way, because the plaintiff is keen to have those attending to its case knowing what its case is and what it is saying, and it is only a rare event that one would have this arise; in practice it does not happen. The other alternative is if one requires the ‑ ‑ ‑

McHUGH J: But if that is the case and if the defendant’s plea of justification does not meet the plaintiff’s case, what is it doing? It is just clouding up the record.

MR GRAY: The answer is it might in a particular extreme case but normally it will not. At a pragmatic level, as a matter of practice and procedure, it works ‑ ‑ ‑

McHUGH J: I mean, this question at trial by ambush was struck in New South Wales again and again in the days before the 1974 Act. The defendants did not know what they had to justify. They would go to trial with a great deal of material and it just may become totally irrelevant.

MR GRAY: One of the difficulties of compelling the plea and imputations is that the plaintiff then will put every possible alternative thing that might arise, so that it covers every possibility and then immediately you have a whole lot of what become essentially non-issues coming forward.

McHUGH J: I understand that.

MR GRAY: So it cuts both ways. If I could move on with the argument. My learned friends in regard to the provisos say this, that if they did face a non-application of section 7 because of the proviso it does not matter, they have still got available to them the common law privilege of fair and accurate reporting in regard to royal commission proceedings, and at common law a reasonable letter was not required. We say that argument cannot be sustained, and I want to just address it briefly. At page 15 of our outline, footnote 91, we address the matter, in particular quote from Justice Cox, when he said that this would be a very curious result if - because it would in effect render nugatory the whole of the effect of the proviso. What is the point of having the proviso and the statute if you have got a wider right of common law? The reason why the argument arises is because of ‑ ‑ ‑

McHUGH J: Your argument is it just simply repeals the common law.

MR GRAY: If that was the common law. We put the argument two way: that if there was a common law that would be appealed; the other argument is that that was not the common law position. In the text that we put ‑ ‑ ‑

McHUGH J: There was a common law defence of fair report.

MR GRAY: But not in regard to ‑ ‑ ‑

McHUGH J: Royal commissions.

MR GRAY: It arose in regard to ‑ ‑ ‑

McHUGH J: Court proceedings.

MR GRAY: Court proceedings and Parliament, where essentially it arose historically because there was absolute privilege there and it was thought that if there was an extract or an abstract of that in a paper it should also be privileged. That is how it arose. If one has regard to the book of historical material provided yesterday, and in particular to Odgers, the Court will find there a very useful treatment of the commentator at the time, and it is made quite plain in that book that there was no other common law privilege other than that which I have described. So they are the two reasons why we say that argument would not succeed.

McHUGH J: I think Justice Brennan’s judgment in Stephens might lend some support to the view that it would be an existing common law defence. That was a.....judgment - sorry, Justice Brennan.

MR GRAY: That might be so now, but the question is what was the position in 1895? Because the statute is - the third proviso uses the words, “now by law existing”. That is the 1895 ‑ ‑ ‑

McHUGH J: Yes, but it depends on what your theory of the common law is, but on one theory that always was the common law.

MR GRAY: Yes. We ‑ ‑ ‑

BRENNAN CJ: On the other theory it never was the common law and has now been unanimously declared not to have been the common law.

MR GRAY: We would like to put - we do put the submission that Parliament when it used the words “now by law existing” did not intend to include what might become the common law by reason of some later court decision; it was talking about the law as it existed on that day, as known on that day. So that what might have developed after 1895 is not relevant in this respect. There was one other, perhaps, authority - I will just provide the reference - to getting to this question of absolute privilege. It is the Royal Aquarium Society ‑ ‑ ‑

McHUGH J: Absolute privilege or qualified?

MR GRAY: Absolute privilege. Royal Aquarium Society v Parkinson (1892) 1 QB 431. I do not propose to read from it. We provide the reference, as we say, and other supporting text in regard to why it is that there would not be a fair and accurate privilege in regard to meetings, because ‑ ‑ ‑

McHUGH J: But they are two different things. I mean Royal Aquarium says there is no absolute privilege in relation to statements made during the course of a meeting of the London County Council, whatever it was, but now we are talking about a report of the proceedings, which is a different matter.

MR GRAY: Yes. We accept that. The line of reasoning is that - this is in 1892, so it is at about the time that absolute privilege was to be restricted and was not to extend to meetings and was to be restricted, for good reason, to judicial proceedings and Parliament. It follows from that that in the judge’s mind at the time there was no question of there being a fair and accurate report privilege in regards to other types of activities that would not even be the subject of absolute privilege at the prime level; a fortiori there would not be a fair and accurate report privilege in regard to a newspaper reporting a public meeting.

McHUGH J: I think just shortly after that there was a decision that there was a defence of a fair report of a meeting of the General Medical Council.

MR GRAY: A question as to the application of qualified privilege, and one has to be very careful then on the facts, but it is really what one then talks about as a question of duty in qualified privilege. In this area we are talking about something that has developed from in effect what was seen to be the public interest in the publication of an extract or abstract of something absolutely privileged. The particular passage is at page 447, and in particular in the judgment of Lord Justice Fry saying that it would be going too far to apply privilege to:

assessment committees, boards of guardians, to the Inns of Court when considering the conduct of one of their members, to the General Medical Council -

So we say in terms of setting the scene as to what was by law now existing in 1895 one can draw from that case a very clear view that absolute privilege was confined and did not extend to such meetings and hence a fortiori a fair and accurate report would not be available. That is the line of reasoning we take from the Royal Aquarium Case.

If the Court pleases, could I move back then to the other points about fair and accurate reporting. Your Honours, I now take you to page 9 of the outline and the first point we make in the written text. This involves a question of construction again of section 7, and in particular it is only a fair and accurate report that is privileged. Our submission is that the report must, as a whole, be fair and accurate, and that one does not say that part of the report is privileged because part of it is fair and accurate and that that which is accurate is only the part that is not fairly or accurately reported.

McHUGH J: But fair and accurate in respect of whom, the plaintiff, or anybody, or everybody? Supposing it is fair and accurate in respect of a plaintiff but not fair in accurate in respect of somebody else?

MR GRAY: We would say that the test is clear; it must be a fair and accurate report in its entirety, in every material respect, because the rationale behind it is that the newspaper is getting a protection because it is in the public interest that it can pick up and report in effect an extract or an abstract accurately and fairly, and if it departs from that it is not entitled to privilege. It is really a derivative matter; that the public interest is being protected is the dissemination of information that is otherwise - it is proper for the public to hear but only if it is fairly and accurately dealt with. Hence we would put it that any material inaccuracy would preclude the report meeting the qualification of fair and accurate. So at that level we would put it that broadly.

Turning to the instant case, of course, the material unfairness that we refer to does touch the plaintiff, so the wider point does not arise. As a matter of construction, to gain the advantage of this protection it obliges the newspaper to get it right. If they do not get it right, then they cannot have the protection, and hence it is not just a matter touching the plaintiff.

McHUGH J: there is no authority on this point, is there?

MR GRAY: Not that we are aware of.

BRENNAN CJ: What is the historical material to which you referred earlier? Is this the booklet?

MR GRAY: It is in the history ‑ ‑ ‑

BRENNAN CJ: It is the article by Odgers, the passage from Odgers.

MR GRAY: Page 266 in Odgers. I am sorry, it starts at the front of the book. It starts in 1881, and we have included text of the relevant Act at page 266 of Odgers. It was then the subject of an amendment in the United Kingdom in 1888, and that is the first document in this book, and that is when it takes on a form very similar to the 1895 South Australian Act. As far as ‑ ‑ ‑

BRENNAN CJ: Where do we find the derivative nature of this privilege? Is there some passage that you wish to refer us to which indicates that, or is that an inference which you have drawn from the materials?

MR GRAY: It is an inference we have drawn and it is touched on, for example, in Odgers. If the Court goes to page 266, and the author’s note at the foot of 266 one finds a treatment of what led to the 1881 Act, and we draw on that, as a matter of history:

The above section was passed because it was considered that the common law pressed too severely upon newspaper editors and proprietors, who in the ordinary course of their business had presented to the public a full, true, and impartial account of what really took place at a public meeting, considering no doubt that thereby they were merely doing their duty, and then found that the law deemed them guilty of libel.

McHUGH J: But if you look at it, history is against you, is it not, because the statute extends the common law, and the common law defence of qualified privilege, in terms of a fair report, was developed as a defence to a plaintiff’s action. A plaintiff sued on something that was said in court and it was said, “Your case fails because it is a fair and accurate report of the proceedings.” So it was developed as an answer to the plaintiff’s case. It is true that the statute has expanded that common law defence so that you get things like public meetings, royal commissions and so on covered by fair and accurate reports. Why is not the thesis still the same, namely that it is designed to give the defendant a defence against the plaintiff’s claim? As long as you can show that what you have published is a fair and accurate report concerning him or her then you have the defence, as opposed to your public interest thesis that you have put forward, which I understand and which has got some force.

MR GRAY: We would put it this way: that there was, last century, recognised there should be absolute privilege for confined matters, Parliament and courts, and it was recognised almost as early as1840 there was some statutes that allowed for abstracts and extracts of that to be published and protected, the 1840 Parliamentary Papers Act. That was clear. Then in the Royal Aquarium Case the Court - perhaps I should just pass that decision to the Court. At page 447, in the judgment of Lord Justice Fry, at the end of the first paragraph:

Wherever you find a Court in law, to that the law attaches certain privileges, among which is the immunity in question.
But this argument was used on behalf of the defendant. It was said that the existence of this immunity is based on considerations of public policy, and that, as a matter of public policy, wherever a body has to decide questions, and in so doing has to act judicially, it must be held that there is a judicial proceeding to which this immunity ought to attach. It seems to me that the sense in which the word “judicial” is used in that argument is this: it is used as meaning that the proceedings are such as ought to be conducted with the fairness and impartiality which characterize proceedings in Courts of justice, and are proper to the functions of a judge.....Consider to what lengths the doctrine would extend, if this immunity were applied to every body which is bound to decide judicially in the sense of deciding fairly and impartially. It would apply to assessment committees, boards of guardians, to the Inns of Court.....General Medical Council.....Is it necessary, on grounds of public policy, that the doctrine of immunity should be carried as far as this? I say not. I say that there is ample protection afforded in such cases by the ordinary law of privilege -

which is qualified privilege. So that is the position. Then it is seen ‑ ‑ ‑

McHUGH J: But that is talking about statements made in the course of proceedings as to whether or not you have got absolute privilege. The cases have gone well beyond Parliament and statements in the course of parliamentary proceedings or curial proceedings. I mean, they affect military tribunals. If my recollection is right, in Lincoln v Daniels. It was held the same in relation to the Inns of Court 1962. And there are others. We dealt with this, to some extent, in Arnold v Mann, a decision we handed down a fortnight or so ago, on absolute privilege.

KIRBY J: Mann v O’Neill.

McHUGH J: I am sorry, Mann v O’Neill.

MR GRAY: We would put it this way, that in 1892 Lord Justice Fry could not have been thinking that there would be a defence of fair and accurate report of a public meeting when he was saying it was not a case of absolute privilege, it is only a case of qualified privilege arising out of duty. What the learned author in Odgers is saying, in this history here, is that Parliament thought that the current law, which did not protect newspapers, was too severe. They would do this out of what they saw as public duty and yet they would front as guilty of libel.

McHUGH J: But I am not so sure that these justices would not have said, even at that stage, that a fair and accurate report of the proceedings of the London County Council, published for the people of London, was not subject to qualified privilege. That is the thesis of Justice Brennan’s judgment in Stephens’ Case.

MR GRAY: We would put it that if one goes to 266 of Odgers, it sets out the 1881 Act and then there appears this sentence:

No other reports are privileged.

Then the note explains a rationale to the section, that Parliament ‑ ‑ ‑

McHUGH J: What page is that again, Mr Gray?

MR GRAY: 266 in Odgers. After the quote of the 1881 provision the next sentence:

No other reports are privileged. If any one publishes an account of the proceedings of any meeting -

There is the section, then the annotation at the foot, “The above section was passed -” because of the matter of public policy. It was thought that newspapers that would report these matters in the public interest would be guilty of libel. So as a matter of public interest, public duty, the statute was passed, and out of that grew this defence. It always a - it very quickly came with a price, and the price of course was the reasonable letter. There had to be ‑ ‑ ‑

BRENNAN CJ: If one looks at the 1881 Act it is not conditioned, or the defence is not conditioned simply on fairness and accuracy, is it? It has got to be “published without malice” and the publication has got to be for the “public benefit”.

MR GRAY: Yes, and it is the same with the current Act. If one goes to ‑ ‑ ‑

BRENNAN CJ: Does that suggest that it is, as it were, an extension of the absolute privilege of Parliament and the courts, or is it rather an indication that this was seen as extending to these reports the same character as an occasion of qualified privilege and therefore to be construed in terms of its effect upon the plaintiff?

MR GRAY: On its words the matter is quite equivocal; it could mean either. The learned author here has in his commentary picked up a concept of duty, public interest, but equally one could ‑ ‑ ‑

BRENNAN CJ: That is the foundation, is it not, of the qualified privilege concept?

McHUGH J: But also the words “without malice” strongly suggest that one is not looking at qualified privilege, and malice concerning the plaintiff, not somebody else out there.

MR GRAY: If one looks at it in terms of the Parliamentary Papers Act of 1840, that also included when dealing with Parliament and absolute privilege, the statement about no malice. So historically the no malice, in the historical context, was also applied when they dealt with absolute privilege and on publications.

McHUGH J: Yes, but I am not sure that your argument is not running together two concepts. One is statements in the course of proceedings, be it Parliament, the courts or some other tribunal. They have frequently been held to be the subject of absolute privilege. The other question is, what protection is a report of those statements in those proceedings entitled to? That is qualified protection at common law, extended by the statute, and the real question seems to me is the statute merely an historical development or a statutory development of the common law or is it, as you argue, a protection given to newspapers because they are doing something in the public interest and therefore they have got to get it right, generally? So if they report the meeting inaccurately then the defence fails.

MR GRAY: If the Court pleases, we have deliberately chosen of course the comments of an author at the time. This is Odgers, I think, writing in the 1890s, dealing with it at the time in a contemporaneous way. The Court in those circumstances, as a matter of history, would obviously give great weight to that annotation. He then, after that annotation at 267 through to 268, provides some illustrations. First there is Purcell’s Case dealing with the matter in a pre-statute and public interest, no privilege, and then gives some other examples to the same effect.

If the Court pleases, it is a matter of history. We put the submission we do and we base it on the contemporaneous text from one of the most respected authors in this area at the time, and we would say that that forms a very clear foundation. In so far as the Court has put the matter of malice, we draw attention to the fact that that there was in the 1840 Parliamentary Papers Act as a necessary condition before one could get protection on publication of an extract from a parliamentary judicial process. Again, if the Court pleases, it is not a matter that we can further usefully advance.

If the Court pleases, regardless of the answer to that question, in the case at bar we say the material inaccuracy went to what was said of the plaintiff, and hence on any view there was not a fair and accurate report and that the approach of the court below, that it was possible to divide this up, is wrong; either they qualify or they do not. Having failed to qualify under section 7, the whole of the defamatory utterances in the article become actionable and the subject of damage. In our outline we have set out, at paragraph 4.4, a reference in an extract from some of the authorities that deal with not section 7 but the equivalent of section 6.

If the Court could look at the Wrongs Act, we have not found cases on section 7 at all, but section 6 does, in all material respects, contain the same words, “a fair and accurate report” published by a newspaper of the proceedings before a court be privileged. The cases there have held that the fair and accurate report must be accurate as a whole. If there is any material inaccuracy the privilege under section 6 is not available, and one cannot in fact have a privilege for part of a publication under section 6 and not some other part. We say those cases apply, with respect, with full rigour to the current case.

We do, in a footnote, raise a point that section 7 refers to meetings of royal commissions, which does not really sit very well with the taking of evidence which is more akin to a judicial process than a meeting process. We just draw attention to that. There is no doubt an historical reason for that. On the face of it this process of a royal commissioner deciding to take evidence, and then taking evidence does not sit very well with this concept of a meeting. It does not sit easy with that language. We put the submission in a footnote that, as a result ‑ ‑ ‑

BRENNAN CJ: What is your submission, Mr Gray?

MR GRAY: The submission we put is that when a royal commission decides to take evidence it cannot be fairly described as a meeting, and it is as short as that.

KIRBY J: That would really give the paragraph nothing to do.

MR GRAY: No, because a royal commission can operate in a non‑evidentiary taking role. There is no reason why a royal commission has to take evidence. A royal commission could conduct its entire inquiry through public meetings. I see no reason at all why - and it has become common for it to be an evidentiary/adversary-type process; but there is absolutely no reason why it should.

GUMMOW J: Was there legislation in South Australia dealing with royal commissions at the time of the enactment of section 7?

MR GRAY: Yes, there is.

GUMMOW J: Was it is in force at the time of the enactment of section 7, or were they just conducted under the prerogative?

MR GRAY: I will have to check that as to the precise date.

GUMMOW J: It might be an important point. because under the prerogative there is no compulsion to require answers, is there?

MR GRAY: No. At paragraph 4.4, if the Court pleases, we make reference to cases dealing with section 14(1)(d) of the New South Wales legislation that, as we read it, is the equivalent of section 6 of the Wrongs Act directly but also, in all material respects, equivalent to section 7. Those cases - and we have quoted, in particular in Anderson v Nationwide News from Justice Asprey, and then from Justice Hunt in the Waterhouse Case, those texts that support our submission. I do not want to labour those. The same view has been taken in Victoria by Justice Batt in the Bruton Case that we refer to at the foot of page 11, and the same position in Nowlan’s Case in Canada, and also in a British Columbian case in Bennett. We urge that construction in regard to section 7, based on those authorities and, more particularly, the policy that lies behind the defence. This is a special protection for a newspaper; if they want it, they must get it right. It is not a case where they can get part protection; either they qualify or they do not.

There was one other point that we wished to deal with briefly in regard to the issue of fair and accurate, and my learned friends challenged the findings of fact below that there were material inaccuracies. Whether I do that by way of reply or in anticipation of perhaps even the Court’s direction on - and I do not want undue time over it.

BRENNAN CJ: Do it in reply, Mr Gray.

MR GRAY: Thank you, your Honour. Now, could I then turn to damages? That commences at page 16. At appeal book 946 - appeal book 4 ‑ ‑ ‑

KIRBY J: You have no cross appeal on damages, you simply seek ‑ ‑ ‑

MR GRAY: Yes, we do.

KIRBY J: You do, I see.

MR GRAY: But not before this Court, as we see it. At the intermediate court level, a cross appeal was lodged in regard to the award of general damages. In the result, because the majority of the intermediate court rejected any damages for the first article and only noted damages for the second, that cross appeal has not been dealt with. Now, from our perspective, we are more than happy for this Court to deal with that cross appeal, but in our notice of appeal the order we seek formally is that, if we succeed on this appeal, the matter be remitted to the intermediate court for a consideration of our cross appeal on general damages that has not yet been dealt with. So, in that sense, to answer your Honour Justice Kirby, there is a cross appeal in regard to general damages.

The difficulty arises that when Justice Cox, at first instance, assessed general damages, he assessed them at large for the effect of both articles and then made a division between the two. But at that stage he merged his special damages in as well, and one cannot tell exactly what he has allowed for general damages in regard to the first and second article. You just cannot discern it. So, when the intermediate court refused to allow any damages for the first article, it has meant that they have not dealt with that cross appeal, other than to reject it, but having not effectively considered it.

We have prepared a spread sheet in regard to damages, because of the differing views. If I could pass that to the Court and then, perhaps, speed the process of the submission. Now, we have set out the same process of showing each judge’s approach, and we have shown the differing approach on special damages and general damages and, as to special damage, the essential findings of Justice Cox were he accepted plainly the plaintiff on credit, and accepted the plaintiff’s case. He found that, as a matter of causation, he lost his job at Leal Boss as a result of the publication of the first article. It is important - because Justice Williams misunderstands this - it is important to recognise that the loss of the job was between the publication of the two articles.

Then Justice Cox found that, because he was unable to clear his name publicly, he has remained out of regular work ever since. Further, he found that it was likely that if the articles had not been published, but for some reason he had not continued with Leal Boss, he would have obtained a good job, possibly a better one, elsewhere. So, the probabilities are, on his Honour’s findings, that he would have been in good work.

He then assessed special damages for both articles at $175,000. On general damages, he took the view there was an entitlement to substantial damages. He took into account the circumstances of aggravation, which related to a pleading that was finally abandoned in the conduct of the trial, and then he allowed $75,000 for both articles. Then, having assessed the total damage, he then did this division between the two; 225 to the first and 25 to the second. Chief Justice Doyle, in regard to special damage, allowed nothing, nor did Justice ‑ ‑ ‑

BRENNAN CJ: What is meant by “special damage” in this context?

MR GRAY: The economic loss aspect of it. The consequence of the loss of employment and not being able to thereafter find a job.

McHUGH J: It is not special damage, is it? It is general damage.

MR GRAY: No. Justice Williams - his reasoning is absolutely flawed, because he is looking for a nexus between the second article and the loss of the job and, of course, he had lost the job before the second article. So, effectively, his approach on damages does not assist. Under “general damages”, the majority of the intermediate court - Justice Perry and Justice Williams - allowed nothing for the first article - it was not actionable - agreed with Chief Justice Doyle in regard to the second article assessment of $40,000, and Chief Justice Doyle arrived at, as a minority position, $45,000 for the first article. But Chief Justice Doyle made it plain that, in assessing general damages, he was subtracting the effect of the non‑actionable parts from the actionable parts, and we say there that that is a demonstrable error; that there is no occasion for subtracting the effect of the non‑actionable parts.

KIRBY J: Is that any more than saying, well, you look at it as a whole and, looking at it as a whole, $40,000 was the proper sum?

MR GRAY: Yes, it is different, because Chief Justice Doyle says, “I must subtract.” He does a process of subtraction.

KIRBY J: Does he identify a figure and subtract?

MR GRAY: No, he does not identify the figure, but he has gone through a process of subtraction. Now, we say that that is quite inappropriate. Their argument on the “fair and accurate defence” not being available because there were material inaccuracies succeeds - then it necessarily follows that Chief Justice Doyle’s reasoning on damages is wrong, both on special and general damages, as I described. But in particular, there is no occasion for subtracting anything. If the Court goes to page 941, Chief Justice Doyle has referred to Dingle’s Case, and then he says, at line 11:

In my opinion, this reasoning is also applicable to the present case. Of course the defendant is only liable for that part of the article which is not privileged. Therefore one must subtract from the defamatory effect of the article that effect which derives from the non-actionable parts, in accordance with Lord Radcliffe’s approach.

We say that Lord Radcliffe’s approach does not support that. We also say that, and perhaps ‑ ‑ ‑

KIRBY J: What would be wrong if he had said, therefore, one must excise from one’s consideration those parts of the article which are not defamatory? Is that not what he was saying?

MR GRAY: That would accord with law, but that does not involve a process of subtraction.

KIRBY J: It has to be read in its context.

MR GRAY: Well, with respect, these parts are defamatory. The parts that he is subtracting are defamatory.

McHUGH J: But what is wrong in principle? Leave aside Lord Radcliffe and whether or not his speech supports this approach, if an article says that the plaintiff is a murderer and a thief, and the defendant justifies and proves that he was a murderer, surely that must affect the damages he is going to get.

MR GRAY: Of course, and that is done by the judge excising from consideration those parts that are not actionable and he is left, then, to consider the effect of the actionable parts.

McHUGH J: Yes.

MR GRAY: But that does not involve subtracting anything.

KIRBY J: You say he is entitled to full damages for the defamation of being a thief ‑ ‑ ‑

MR GRAY: Entitled to full damages for the actionable ‑ ‑ ‑

KIRBY J: ‑ ‑ ‑ not as a murderer thief. It seems a little bit unreal. A murderer thief does not have a reputation that could be so damaged as it ‑ ‑ ‑

MR GRAY: Well, that would be a difficulty in the case, but he is entitled to full damages for that part which is actionable, and the judge has to excise the non‑actionable part and look at what the actionable part caused. What was the result from ‑ ‑ ‑

BRENNAN CJ: When one is looking at general damages, one is looking at the damage that is done to the plaintiff’s reputation. If the plaintiff’s reputation is lower than it would have been if the non‑actionable parts - I am sorry, I withdraw that. If you find that the reputation is one which has been damaged, and rightly so, by the publication of some non‑actionable matter, why should not that be taken into account?

MR GRAY: It is taken into account by being excised from consideration, and one is left with the actionable part to be considered and to ask the question, was this a cause of the loss complained of?

BRENNAN CJ: Let is take the present case. Let us assume that there was a perfectly accurate publication made of the evidence given before the Royal Commission. There would, nonetheless, have been this statement that Chakravarti was one of those as to whom a question of civil or misconduct arose. That would have been damaging.

MR GRAY: Yes.

BRENNAN CJ: Now, why is that not to be taken into account in determining the damage that was done to his reputation by conflating the evidence with respect to two of the directors with the evidence in respect of Chakravarti and the other three directors?

MR GRAY: In our respectful submission, when - perhaps to use the example - the words that Lord Denning uses, that when the newspaper adds spice, it becomes liable for the whole joint. So, it is when it elects to add something that is actionable that it must be responsible for the effect on the whole.

GAUDRON J: Is this aspect of your argument not wound up with your argument that the whole report must be fair and accurate?

MR GRAY: Yes, it is.

GAUDRON J: So that if that defence fails in its entirety, then all parts of the defamation are actionable?

MR GRAY: Indeed. That is why we put this as an alternative ground of appeal. It is tied directly to that.

GAUDRON J: On the other hand, if you are wrong about that - about your first position - there is no basis on which you can say you get damages for the lot.

MR GRAY: No. If we are wrong on that, we are then left with the actionable part to proceed on, but we then say, as an alternative, that, in that circumstance, Chief Justice Doyle erred in this process of subtraction. If one looks at his next sentence ‑ ‑ ‑

McHUGH J: Yes. But just before we proceed, does not the problem arise in this case because it was found that the matter gave rise to various imputations, some of which are protected and some of which are not protected and so that, if you find some imputations are protected, contrary to your argument, you have got the problem then of how you assess damages for the unprotected imputations?

MR GRAY: Yes. It is an alternative argument. If we win on our primary argument of “fair and accurate”, the problem does not arise because Chief Justice Doyle has not considered the full defamatory effect of the article.

McHUGH J: But if you do not win on your - the problem does arise.

MR GRAY: The problem does arise, and we say this process of subtraction that Chief Justice Doyle has gone through is inappropriate.

McHUGH J: Well, let me give you this illustration: supposing you have got two plaintiffs, both of whom sue on the same article, which accuses both of them of being dishonest and incompetent accountants. The defendant proves the first plaintiff is dishonest, but he is entitled to damages in respect of the allegation of incompetence. The defendant fails in its pleas in respect of the others. Now, you cannot award the first plaintiff as much for incompetence as you would the second person, would you? In other words, you have got an article which says that somebody is dishonest and it is non‑actionable as far as that person is concerned, but, at the same time, it has said he is incompetent. Well, he is entitled to damages, but realistically you cannot leave out of consideration, can you, the fact that he has been found guilty of being a dishonest accountant, even though he is not an incompetent accountant? He is entitled to some damages but ‑ ‑ ‑

MR GRAY: Indeed, we accept that. What the ultimate dollar consequence is is a matter of causation and it is possible, in a particular circumstance, the damages might be the same because of a new set of facts. Possible, but we would agree in the ordinary case one would expect a different measure. But that is achieved not by any process of subtraction; that is achieved by - in regard to one man saying, “What is the consequence of having defamed him as dishonest and incompetent?” and the other man, “What is the consequence of defaming him as incompetent?” and the court would then have the task of, as a matter of causation, assessing that consequence.

McHUGH J: But I do not know that there are any rules about this. I mean, it is a sort of intuitive thing, really, I think.

MR GRAY: Yes, there are no rules about it, apart from the normal causation rules and, of course, that does lead to common sense and intuition. But this is a problem that has been there for a long while in the law of defamation, and the traditional way of dealing with it is simply that the judge will ignore the - excise the non‑actionable material.

McHUGH J: Juries used to deal with it by awarding a cent, or a quarter - a farthing, they used to - in some of those cases.

MR GRAY: But they are, essentially, if one thinks it through, pure issues of causation, and the problem comes, perhaps in lible, from trying from an evidentiary point of view, to track through cause and effect.

McHUGH J: It may have something to do with what sector of your reputation is involved, as it were.

MR GRAY: Yes, so the variables are infinite. But at the end of the day, in the first example, the judge has to assess what is the consequence of this accountant being defamed as to competence and, in the second plaintiff, what is the effect on this man being defamed as dishonest and incompetent? Common sense would suggest that that would lead to a different measure of damage because one is a greater defamation than the other. But that is not what Chief Justice Doyle was doing. If one looks at his next sentence, having said one must subtract, he says:

However, one may not reduce the award of damages -

so, he is talking about reduction of damages -

one may not reduce the award of damages which would go to vindicate the plaintiff in relation to a false imputation, merely because other statements have been made (either in the same article or in other previous articles) which are almost as discreditable but which are justified or privileged.

So, he is putting a brake on there, but makes it plain that he is using the word “subtract” in the sense of reduction of damages.

McHUGH J: Well, I am not sure that is right.

KIRBY J: Does not that brake indicate that he has in mind that ultimately you have to come back, as the Chief Justice said, to the compensation to the plaintiff for the damage done to his reputation, taking into account that he has had some discreditable things proved against him which are justified or privileged?

MR GRAY: With respect, one cannot tell what he has done, because he does not explain what he does, but except when he uses the word “subtract” in the same paragraph, he is obviously talking about “subtract” in the sense of not reduce the award, otherwise there would be no need for the second sentence.

KIRBY J: There are real dangers in taking one word in a long judgment in a complex matter. I know that is all that the courts have, but it is a bit dangerous, I think.

McHUGH J: I must add to that I read what his Honour said as the contrary of what you are putting and is, indeed, favourable to you. What he is saying is that one must subtract from the defamatory effect of the article that effect which derives from the non‑actionable parts. So, you have got totality of defamation. You slice away from that that part which is non‑actionable and that leaves you with the rest, and then you assess that. Then he goes on to say but you do not reduce the award in respect of that actionable part merely because other statements have been made in the same or in previous articles. I would have thought it was helpful to you, rather than adverse to you.

MR GRAY: Yes. But then, the difficulty is in the next paragraph:

In the present case, for instance, the fact that suspicion has been cast upon Mr Chakravarti, far from reducing the damage likely to be done to him.....made him more vulnerable.

So, he is still in the process of reducing damages. In this particular paragraph he is putting a matter favourable to my client, but it does show that his mental process is one of subtraction; that is, reduction of otherwise money award.

McHUGH J: I do not think he is.

KIRBY J: Do you have a ground of appeal that says that, even on the hypotheses that the Chief Justice, embraced by the other judges, has adopted that the sum is inadequate? Because it seems a very small sum by Australian standards.

MR GRAY: Yes, we do.

KIRBY J: I mean, I am not making any final comment, but I thought I read in some media journal analysing media law cases a decision in the New South Wales Court of Appeal about standards for damages in destruction of reputation, or damage to reputation. I do not think that case came to this Court, but there would not seem to me to be any reason of principle for large differences in damages between different parts of Australia.

MR GRAY: No, we would have - if our primary submission is right that this article is actionable, it is a very grave defamation in regard to a person holding a very senior position in the finance industry. He had not been able to work from the time of this article until trial, and the award of general damages we complain about as being totally inadequate.

KIRBY J: Was that your cross appeal to the Full Court?

MR GRAY: Our cross appeal has not been dealt with and, for out part, my client would obviously wish this matter to be resolved, if he could, without further hearings and, if this Court was able to deal with that cross appeal, we would obviously wish the Court to deal with it and not be subjected to yet a further hearing. But we do say that in the 1990s this does represent a very modest assessment.

KIRBY J: Do you know that case in the New South Wales Court of Appeal that I am referring to? There was some statement by Justice Mahoney, I think, about damage to a professional person’s reputation.

MR GRAY: Yes, it is in the book of authorities, if the Court pleases, as I understand it.

KIRBY J: Is it? Very well, we will find it. Do not worry.

McHUGH J: It is Nugawela, is it not? The doctor - the internet case; Crampton v Nugawela, if that is how you pronounce it.

MR GRAY: Yes.

KIRBY J: Maybe it is only to be confined to professional people and not bankers.

MR GRAY: It is case 11, Crampton v Nugawela (1977) 41 NSWLR 176.

KIRBY J: 1977 or 1997?

MR GRAY: 1997. Yes, I misread it. Now, the other matter in regard to damages is taken up at page 18, and it deals with economic loss. Now, there is a summary of the evidence of economic loss attached to the outline, where we have sought to pull together with a very short annotation the evidence‑in‑chief, cross‑examination and re‑examination of Mr Chakravarti. Now, the evidence in this regard was quite short. If I might just summarise it; Mr Chakravarti’s position was that he was well qualified academically and practically, and he had worked in various positions, improving his position over time in the finance industry.

BRENNAN CJ: Page references?

MR GRAY: They are set out - there is a summary of evidence and economic loss - it is a four page annexure to the outline, which sets out all the references and the summary. Now, he left Beneficial in November 1990 in circumstances where he continued on after the problems, and he had applied for the position of Managing Director and was unsuccessful, and he then left. He sought, and obtained, consultancy work in the months that followed, and he did consultancy work for Leal Boss, and they were pleased with his work. What he did was prepare a five year business plan, and they were sufficiently pleased with it that in April 1992 he was appointed as the Chief General Manager of Leal Boss at a salary of $90,000 with some extra benefits. The term of his employment was not fixed, but it was understood that he would see through the five year business plan, so, on his case, a five year, at least, arrangement.

Your Honours, could I ask if your Honours are going to sit until 4.30 as your Honours did yesterday?

BRENNAN CJ: Yes, we will sit to 4.30.

MR McCLINTOCK: Thank you, your Honour. Your Honours, can I then go, having covered, I believe, the points I wish to make in relation to the first article, and then deal with the second article and I will deal only with the report aspects of the matter.

Could I take your Honours to the judgment of the Chief Justice on this point? I will need, of course, to take your Honours to the diary note here. The Chief Justice’s judgment on this point appears at pages 936 to 937 of volume 4 and at line 14 his Honour rejects the defence of “fair and accurate report” in relation to the imputation which he had found. That imputation is set out on page 934 of the defence. His Honour is referring there to what is imputation (b), I am sorry no, it is imputation (a):

The plaintiff had engaged in criminal conduct in connection with a loan or loans made to him;

He then continued:

I respectfully disagree with the trial judge. I consider that there is no ambiguity in Mr Simmons’ notes. They do state, in my opinion, that the loans involving the plaintiff “may be criminal rather than civic.” I consider that part 6 of the note, taken as a whole, is dealing with a single topic, loans, of which one example is given, and that the comment relates to all of the loans.
In my opinion, in relation to the second imputation the article is not a fair and accurate report. The “conspiracy of silence”, to which Mr Simmons referred, was obviously related to the handling of loans. But I consider that the first paragraph of the article suggests a more active form of conspiracy, and one which has more serious overtones than a “conspiracy of silence” - which in common speech often means little more than a failure to disclose.

I consider that in relation to the third imputation the article is a fair and accurate report. I consider that Mr Simmons’ notes are capable of meaning that the unauthorised loans involving the four executives “may be criminal rather than civil”, in the sense of at least civil misconduct and possibly criminal misconduct. To the extent that his notes are ambiguous (and I do not think that they are) I consider that the article does not become unfair or inaccurate in resolving that ambiguity. We know from the notes that the loans were regarded as unapproved and unauthorised. We know from the notes that Mr Simmons thought the loans revealed a “conspiracy of silence”, and that the four executives “will have to go”. In this context I consider that the impression conveyed by the article, of civil misconduct and possibly criminal misconduct, is substantially the impression that the listener in court would have court.

His Honour then goes on to find that the fourth and fifth imputations ‑ ‑ ‑

McHUGH J: Now what does his Honour mean when he is talking about “the listener in court” would have got? He is talking about the reader of the diary no doubt, not the “listener in court”.

MR McCLINTOCK: Your Honour, his Honour, I have to accept, was not being very precise there. It must be he was ‑ ‑ ‑

McHUGH J: He was inaccurate.

MR McCLINTOCK: Inaccurate, your Honour. His Honour must be interpreted, though, as meaning that what the reader of the diary note, these documents having been released on the day before the article, would have got. His Honour continued:

As to the fourth and fifth imputations (which are linked) my conclusion is that the article is not a fair and accurate report. Mr Simmons’ notes indicate clearly, in my opinion, that the loan “he looked at” was but an instance of the loans which caused concern, and left open the question of which of the executives was involved in it. It did not imply that all four were. In my opinion the first three paragraphs of the article imply that the joint venture arrangement did involve all four executives. In that respect it is inaccurate.

His Honour then went on to say that those imputations were “overshadowed by the third imputation” that he found to be accurate as a report.

Your Honour, there are two submissions that I wish to make in relation to, can I say this - Mr Justice Perry agreed with the Chief Justice on this point. Mr Justice Williams agreed with the trial judge who took a different approach in relation to the fairness of the second article.

Could I take your Honours to the diary note. Perhaps I will take your Honours first to the article itself and your Honours will see in relation to the article that there is a heading “Loans may be criminal: bank chief’s diaries” and there is, of course, a picture of Mr Simmons. The article commences with the words:

Sensational allegations of a conspiracy within the State Bank group and multimillion-dollar unauthorised loans involving senior executives have been revealed in diary notes kept by former bank chairman Mr David Simmons.

Mr Simmons says the circumstances surrounding the loans “may be criminal”.

The loans include unapproved loans to four senior Beneficial Finance Corporation executives and a $37 million joint venture arrangement with a Melbourne developer.

Mr Simmons’ diaries also refer to a “Beneficial conspiracy”, how Board presentations had been “pulled” and how internal audit reports were “screened”.

I should point your Honours also at this stage to what has been called a “graphic”, although one wonders why it has been called that, that appears below the picture of Mr Simmons where it says there:

Preliminary audit reveals Baker, Reichert, Chakravarti and Martin have all loans which were not approved, and were not authorised and are in excess of agreed benefits....May be criminal rather than civic.

Your Honours will see that there are the four dots between the words “benefits” and the word “May” indicating that an omission of something has been made there. The answer to what ‑ ‑ ‑

McHUGH J: An omission that would not alter the context or the meaning?

MR McCLINTOCK: Even if it did, your Honour, and in my submission, it does not, the reader - and the reader is to be taken to read the whole article ‑ finds out what has been left out when he reads the article which sets out this part of the diary note verbatim. Your Honour, it says ‑ ‑ ‑

McHUGH J: But not every reader reads the whole article.

MR McCLINTOCK: But your Honour, the reasonable reader is taken to read the whole article.

McHUGH J: Is he? Is that what the cases say?

MR McCLINTOCK: That is what the cases say.

KIRBY J: I thought we had read to us a passage yesterday which said the opposite.

MR McCLINTOCK: I do not recall that, your Honour, but the authority in this Court is World Hosts v Mirror Newspapers.

KIRBY J: But what about what Justice Aickin said in, is it Reader’s Digest v Samuels, I think it is, about how readers place more emphasis on headlines than they do on text.

MR McCLINTOCK: They may, your Honour, but one cannot ignore the text. Your Honour, it would cause serious injustice in newspapers if you could pick and choose between the material that they published ‑ ‑ ‑

KIRBY J: But that is how people in the community read and they are the people in whose hands are the reputations of those who come to the courts for redress.

McHUGH J: I must be the most unreasonable reader in the community because 90 percent of articles I read, I just look at the headlines and maybe the first paragraph and if it does not interest me I do not read any more.

KIRBY J: Or the graphics, the graphics too.

McHUGH J: Yes, the graphics too, so you just move on.

MR McCLINTOCK: Your Honour, the graphics may drag you in.

GUMMOW J: That is why they are there.

MR McCLINTOCK: Of course, but that does not alter the proposition that the reasonable reader is taken, and this is what the authorities say, to read the whole article.

KIRBY J: I would like authority that says that, because I find that so unrealistic that the damage that is done is done by people who do not read the whole article and yet we must assume that it is to be tested by those who do read the whole article.

MR McCLINTOCK: Your Honour, the reasonable reader who, for example ‑ ‑ ‑

BRENNAN CJ: We know what you are saying, we know what you are about to say. What is the authority?

MR McCLINTOCK: I am sorry, your Honour. The authority is as I believe World Host v Mirror Newspapers. I do not know whether it appears in our bundle but perhaps I could ask one or other of my learned juniors to find the references and I will go on with the points I wish to make about the ‑ ‑ ‑

McHUGH J: And you might also just look at Reader’s Digest v Lamb, I think is the case where Justice Aickin spoke about how people read articles.

MR McCLINTOCK: I think the other case may be Gordon v Amalgamated Television Services. Your Honour, the article in the third column, in the material from the place where I stopped, after it refers to the fact that:

Several hundred edited pages of diary notes kept by Mr Simmons were released yesterday by the State Bank Royal Commission.

It goes on to deal with the other aspects of the diary notes and it comes back to the particular subject matter and sets it out in what is the third column. The relevant material appears in the second paragraph on the fourth column where it says:

“In telling management of investigation of Beneficial, suggested we should see all loans.
“Preliminary audit reveals (John) Baker, (Erich) Reichert, (Manob) Chakravarti and (Garry) Martin (all Beneficial Finance executives) have all loans which were not approved and were not authorised and are in excess of agreed benefits.
“The loan I looked at was a joint venture and it appears that this joint venture with a Melbourne developer is in default and the account is in default at a level of $37 million rather than within the approved Board $30 million.
“May be criminal rather than civic (civil misconduct).

There are other references there. The next one that refers to the plaintiff, though, is the second last paragraph in that column:

“Believe that Baker, Reichert, Martin and Chakravarti will have to go - question, when?” he says.
Mr Simmons also refers to Mr Clark, noting that it is likely he “will retire early”.

Could I then take your Honours to the diary note itself and from the appeal book the note appears that ‑ ‑ ‑

GUMMOW J: 867?

MR McCLINTOCK: Yes, your Honour.

McHUGH J: No, I think it was 854a, is it not.

MR McCLINTOCK: 854a, b, c and d. Now, for convenience, I have handed up to your Honour the actual diary note transcribed. The principal reason for that is because of the illegibility of what appears on 854b, at least on the right-hand side of the page. The first point about it - and this, in my submission, resolves the question as to whether it is predated or postdated, the attendance on the Premier - is that it is described as an attendance note and your Honours can see that Mr Simmons is billed for it. It says “Units: 10” in the middle of the page across from “30 July 1990”. Then it says “Lawyer: David Simmons”. It is the kind of diary note that a partner of a law firm makes after he has attended upon a client for the purpose of one, recording what he said and second, recording the billing information. “Other Party: Premier”, “Client: State Bank”, “Matter Description: Board”, “Matter No.:” It then continues:

Attendance on the Premier.
Meeting set up to discuss:

and it then goes on -

(a) Bank’s real position prior to meeting tomorrow and emphasis on points which will have a political flavour.

The material there down to the numbered paragraph (e)3, after that it says:

Baker at lunch at the end of June raised question of Beneficial’s bad debts and where they are hidden.

He then raised other materials I do not need to take your Honours to. Over the page Mr Simmons sets out what he said to the Premier in note form about Beneficial -

GAUDRON J: Well, again, there is an assumption that he said it or what he was going to say to the Premier from this diary note.

MR McCLINTOCK: Your Honour, in my submission, the answer to that is given by the points I mentioned on the first page. That is, his bill for it.

GUMMOW J: Of course he bills for it. He bills for everything he writes down.

MR McCLINTOCK: Yes, your Honour, but what it is, the billing notice is what is called an attendance note and it is indicating that he attended upon the Premier.

McHUGH J: Yes, I know, but some of the language is very strange for it to be an attendance note. If you look at 854b under the heading “Beneficial”, paragraph 2:

You might remember in Early February I told you that I was worried with Beneficial.

This rather looks to me as if it is a precis of a speech or ‑ ‑ ‑

KIRBY J: Where is the record of what the Premier said in response to all this?

MR McCLINTOCK: What the Premier said in response to that, your Honour, is in the evidence.

KIRBY J: No, no, in the note, I am talking about, given that this is supposed to be a note, one would expect that it is not a one-sided note.

McHUGH J: Yes, I think the point Justice Kirby has just made is conclusive against your argument. I mean, it is just impossible to think that the solicitor would not have the Premier’s replies in there.

MR McCLINTOCK: Your Honour, the difficulty with that, though, is that the note was treated in the royal commission, and this appears in the transcript, at the passages which led to the earlier article as if it was an attendance note of recording information that he had told the Premier and so far as I am aware, and I stand to be corrected on this, it was treated at the trial of these proceedings as if it was an attendance note and I do not believe any point was taken that it was not done after the conversation or the attendance between Mr Simmons and the Premier. I do not believe that to be the case, your Honour. I will have it checked overnight.

McHUGH J: But, for example, you can hardly imagine that he would leave out of his attendance note a reference to the Premier’s anger. He gave

evidence about that. You just could not believe that the solicitor preparing an attendance note, not only has not got a word about it, but does not make a note of something as important as that.

MR McCLINTOCK: There may have been very good reasons for not writing down what the Premier said. There may have been very good reasons for writing down only what Mr Simmons told the Premier. I do not know that but, in circumstances such as this, where the board of the State Bank, on any view of the matter, where the chairman of the board of the State Bank is going to the Premier of the State to tell him that there is a serious question that senior executives of the company have, not to put too fine a point on it - when one looks at the top of page 3 - possibly engaged in criminal conduct in relation to loans themselves, there may very well be other explanations for the scantness, in that sense, of a diary note other than the fact that it was made beforehand for Mr Simmons to speak to.

But, in any event, it may not matter, your Honours, because regardless of when it was created, my client was still entitled to report it, it being evidence given at the royal commission.

Your Honour, I see the time.

BRENNAN CJ: Yes, how long do you expect to take?

MR McCLINTOCK: Your Honour, I do not think I will be longer than half an hour. I will finish in half an hour.

BRENNAN CJ: All thing being well.

MR McCLINTOCK: No, I will finish in half an hour, your Honour, all things not being well.

BRENNAN CJ: Mr Gray, how long do you expect to take in reply?

MR GRAY: If the Court grants special leave in regard to the cross appeal so that proceeds, we might perhaps be half an hour; otherwise shorter.

BRENNAN CJ: The Court will adjourn now until 10.15 and the next matter will not be listed before 11.15 am tomorrow.

AT 4.32 PM THE MATTER WAS ADJOURNED
UNTIL WEDNESDAY, 3 SEPTEMBER 1997