Channel Seven Sydney Pty Ltd v Fisher - [2015] NSWCA 414

Court of Appeal

Supreme Court

New South Wales

Summary available

Medium Neutral Citation: Channel Seven Sydney Pty Ltd v Fisher [2015] NSWCA 414
Hearing dates: 3 November 2015
Decision date: 22 December 2015
Before: Basten JA at [1];
Simpson JA and Tobias AJA at [90]
Decision:
(1)   Appeal allowed.

(2)   The order of 17 November 2014 that the defendants pay to the plaintiff damages in the sum of $125,000 be set aside.

(3)   In lieu thereof, the defendants pay to the plaintiff damages in the sum of $75,000.

(4)   Grant leave to the respondent to appeal against Orders 3 and 4 of the orders made on 31 December 2014.

(5)   Set aside Orders 3 and 4 of the orders made on 31 December 2014.

(6)   In lieu thereof, order that the appellants pay the respondent’s costs of and incidental to the proceedings, to be assessed on the ordinary basis up to and including 6 February 2014, and on an indemnity basis on and from 7 February 2014.
(7)   Order that each party pay his or its own costs of the appeal and the summons for leave to appeal.
Catchwords:
APPEAL – defamation – assessment of damages – amount in issue relatively small – unfavourable credit findings with respect to the plaintiff by the trial judge – whether remittal required – whether substantial miscarriage of justice if no new trial ordered – Uniform Civil Procedure Rules (NSW), r 51.53 – relevance of the costs of new trial and determining the matter of appeal – Civil Procedure Act 2005 (NSW), Pt 6

DEFAMATION – assessment of non-economic damages – mitigation of damages – effect on plaintiff’s reputation of imputations found to be true in whole or in part – whether judge impermissibly “netted” imputations – whether relevant findings not made – contextual imputation found not to be true by the jury – whether the trial judge impermissibly took contextual imputation into account
COSTS – defamation – damages reduced on appeal – plaintiff’s offer rejected by defendants – where unfavourable findings made by trial judge about plaintiff’s conduct at trial – whether to order costs where lengthy trial resulted in low award
Legislation Cited: Civil Procedure Act 2005 (NSW), Pt 6
Defamation Act 2005 (NSW), ss 25, 34, 38, 40 42
Supreme Court Act 1970 (NSW), s 101
Uniform Civil Procedure Rules 2005 (NSW), rr 42.14, 51.53
Cases Cited: Carson v John Fairfax & Sons Ltd (1993) 178 CLR 44
Filippou v The Queen [2015] HCA 29; 89 ALJR 776
Gacic v John Fairfax Publications Pty Ltd [2015] NSWCA 99
Holt v TCN Channel Nine Pty Ltd (2014) 86 NSWLR 96; [2014] NSWCA 90
John Fairfax Publications Pty Ltd v Zunter [2006] NSWCA 227
Pamplin v Express Newspapers Ltd [1988] 1 WLR 116
Category: Principal judgment
Parties: Channel Seven Sydney Pty Ltd (First Appellant/First Cross-Respondent)
David Richardson (Second Appellant/Second Cross-Respondent)
Brian Stanley Fisher (Respondent/Cross-Appellant)
Representation:
Counsel:
Mr R G McHugh/Mr M Richardson (Appellants/Cross-Respondents)
Mr R Rasmussen (Respondent/Cross-Appellant)
Solicitors:
Addison Lawyers (Appellants/Cross-Respondents)
Michael Kreveld Legal (Respondent/Cross-Appellant)

File Number(s): 2015/26431
Decision under appeal

Court or tribunal:

Supreme Court

Jurisdiction:

Common Law Division

Citation:

[2014] NSWSC 1616; [2014] NSWSC 1873

Date of Decision:

17 November 2014 (No 4); 31 December 2014

Before:

Rothman J

File Number(s):

2011/408095

Judgment

BASTEN JA: On 6 June 2011 the Channel 7 “Today Tonight” program broadcast a segment reporting complaints about the conduct of the respondent, Brian Stanley Fisher, then engaged in driving a school bus. The business, known as “Fisher Bus” and operated by Mr Fisher and his wife, included a service for rural school children travelling between Gloucester and Taree. That particular service had been acquired in 2008.
On the same day that the program went to air on national television, Mr Fisher’s bus driver’s licence was suspended by the Department of Transport (“the Department”), following an investigation into complaints about his conduct, being complaints of the same nature as those aired on the program.
On 14 December 2011 Mr Fisher (hereinafter “the plaintiff”) commenced proceedings in the Common Law Division seeking damages for defamation against the present appellants, being the broadcaster and its reporter, David Richardson (“the appellants”). The broadcast covered a number of complaints made by schoolchildren and their parents concerning the conduct of the plaintiff. The flavour of the allegations can be gleaned from the imputations which were found by a jury to be conveyed and to be defamatory:

(b)   the Plaintiff wrongly used his mobile phone while driving his bus containing 40 schoolchildren on a notorious stretch of outback road;
(c)   the Plaintiff drove his bus which was carrying schoolchildren in a dangerous manner;
(d)   the Plaintiff drove a bus containing 40 schoolchildren without wearing a seatbelt;
(e)   the Plaintiff is a menace to the safety of others;
(f)   the Plaintiff unjustifiably banned schoolchildren from travelling on his bus thereby depriving them of the opportunity to attend school;
(g)   the Plaintiff stranded children who were passengers on his bus.

The appellants sought to justify each of the imputations as substantially true,[1] a defence which succeeded with respect to imputations (c) and (d).
1. Defamation Act 2005 (NSW), s 25.
On 17 November 2014, Rothman J gave judgment in favour of the plaintiff and assessed damages in the sum of $125,000. [2] (An order for payment of that sum was entered on 17 November 2014.) Further orders made on that day were vacated on 31 December 2014 and replaced by other orders, including an award of interest on the whole of the damages at the rate of 3% from 6 June 2011 until 17 November 2014, together with costs in favour of the plaintiff, to be assessed on the ordinary basis up to 6 February 2014 and thereafter (as to 85% of the costs) on an indemnity basis. [3]
2. Brian Stanley Fisher v Channel Seven Sydney Pty Ltd (No 4) [2014] NSWSC 1616 (“Fisher”).
3. Fisher v Channel Seven Sydney Pty Ltd (No 5) [2014] NSWSC 1873.
The present appeal is directed to the assessment of damages. The appellants contended that the amount awarded should have been “nominal” or in a “very low range.”
The plaintiff filed a cross-appeal challenging the failure of the trial judge to require that the full amount of the costs incurred from 7 February 2014 be assessed on an indemnity basis. The appellants submitted that the plaintiff required leave to pursue a cross-appeal limited to the question of costs. For reasons explained below, it will not be necessary to address the cross-appeal, or its competency.

Assessment of damages – principles and basis of challenge

The Defamation Act 2005 (NSW) requires that there be “an appropriate and rational relationship between the harm sustained by the plaintiff and the amount of damages awarded.”[4] There is a cap on the amount of damages which may be awarded for non-economic loss which, at the relevant time, was $366,000. [5] That cap may be exceeded where the court considers that the circumstances warrant an award of aggravated damages; the judge declined to award aggravated damages. [6] The Act also permits a defendant to call evidence in mitigation of damages, identifying specific matters which may constitute mitigation, including the giving of an apology or making a correction. No apology or correction was sought or given in the present case. However, mitigation, under the general law, may extend to other matters and s 38 of the Defamation Act does not limit the matters which can be taken into account in mitigation. [7]
4. Defamation Act, s 34.
5. Fisher at [66].
6. Fisher at [106].
7. Defamation Act, s 38(2).
The Defamation Act does not otherwise affect the principles according to which damages are awarded for defamatory publications.
Many statements of the principles governing the award of damages for defamation are to be found in cases in which damages were assessed by a jury and the appellate court was dealing with the proper instructions to be given to the jury. For example, in Carson v John Fairfax & Sons Ltd [8] it was said in the joint reasons of the majority that there are three purposes to be served by an award of damages, namely “consolation for the personal distress and hurt caused to the appellant by the publication, reparation for the harm done to the appellant’s personal and (if relevant) business reputation and vindication of the appellant’s reputation”. [9] The joint reasons further noted that where a substantial sum had been provided for personal distress and hurt and for harm done to the person’s reputation, it would be unnecessary to award a further sum by way of “vindication of reputation”. [10]
8. (1993) 178 CLR 44 .
9. Carson at 60 (Mason CJ, Deane, Dawson and Gaudron JJ).
10. Carson at 66.
The award of damages in the present case was purely for non-economic loss, a submission that the allegations had resulted in the suspension of the plaintiff’s bus driver’s licence (which might have formed the basis for a claim for economic loss) having been rejected. [11] An assessment of non-economic loss requires consideration of the particular aspect of the plaintiff’s reputation which is said to have been harmed and an assessment of the extent of the harm properly attributable to the defamatory publication. That exercise will require consideration of the seriousness of the imputations and the extent of the publication. At the heart of the appeal, however, was a complaint as to the manner in which the trial judge had dealt with questions of mitigation. In this area of the law, the term “mitigation” is not directed to conduct which the plaintiff might have taken, but did not, in order to lessen the harm resulting from the tortious conduct of the defendant; rather, it refers to evidence tending to demonstrate that the injury to the plaintiff’s reputation was not as great as might otherwise appear. That element is significant in an area where a good reputation will be accepted in the absence of evidence to the contrary and it will usually be presumed that a defamatory publication will damage that reputation.
11. Fisher at [79]-[82].
Against this background, the appellants raised two broad challenges to the assessment of damages. First, they submitted that, although the primary judge had identified much of the evidence upon which they relied to demonstrate mitigation, the judge failed to make findings with respect to that evidence, and therefore to assess the consequences which might have flowed from findings favourable to the appellants when assessing damages. Secondly, they complained that in some cases, where important findings had been made favourable to their case, the facts found were treated as irrelevant to the question of mitigation. As a consequence, the judge had erroneously failed to find that the publication had no appreciable effect on the plaintiff’s reputation as a bus driver.
To assess these complaints, it is necessary to turn to the reasons given by the trial judge for his assessment of damages.

Reasoning of trial judge

After noting the findings of the jury, the judge set out some relevant background with respect to the plaintiff’s work and business history. He noted that since 2003 the plaintiff and his wife had operated a commercial bus service. [12] In 2008 the business bought the Gloucester to Taree school bus service, transporting 35-40 schoolchildren between their homes and their schools. The service operated on rural roads, part of the journey being along a stretch known as Bucketts Way, which was known as a potentially dangerous stretch of road.
12. Fisher at [15].
The imputations noted above fell into two broad categories: first, there were allegations about the plaintiff’s conduct as a bus driver, including driving whilst speaking on his mobile phone, driving without a seatbelt, driving a vehicle without a working speedometer and driving with the door open. The second category included the plaintiff’s conduct in interacting with the passengers. The plaintiff gave evidence that at least some of the children were involved in “disruptive and disrespectful behaviour”, naming six individuals. [13] His evidence was summarised by the trial judge in the following passage:[14]

“The children would swear, damage and vandalise the seats and the bus, throw rubbish and objects out the window, spray high concentrations of deodorant and make inappropriate sexual remarks to female passengers …. One or more of them acted in a manner that was deliberately defiant: opening windows (or closing them) when asked not to do so; ‘mooning’ persons outside the bus, and like behaviour.”
13. Fisher at [21].
14. Fisher At [22].

This conduct led to responses by the plaintiff, including banning certain children from travelling on the bus for a period of time and leaving one child at a school which was not his intended destination. The issue as to the appropriateness of the plaintiff’s response was raised with two of the parents in the course of interviews broadcast on the program, one mother being asked, “Are you just a whinging mum with a naughty child?”
While it will be necessary to consider in more detail the facts relating to the various incidents and imputations, it is appropriate to start with the assumption that the first category (involving the conduct of the plaintiff as a driver) would be more harmful to his reputation than imputations in the second category, suggesting that he had had difficulty controlling the children and had overreacted to their disruptive behaviour.
The trial judge summarised the impact of the program on the plaintiff and its potential impact on his reputation. The plaintiff had given evidence as to his reaction in the following terms: [15]

“Just that it completely misrepresented me as a person and, yes, and people saw the programme and … it caused people to have doubts about me and I was alienated as a result of the program. [I] – sort of become an outcast, I suppose you could say. We stopped getting charter work with the schools. … [E]ven my own father asked me if it was true. He rang me up. My sister. Family and friends. You know, just caused doubts in their minds about me and, you know, they asked me if it was true.”
15. Tcpt, p 54(15)-(25).

The plaintiff was also asked whether the program had had any effect on his family life and married life; he replied: [16]

“Just turned our whole life upside down. I was married to my wife 15 years, we were together 17 years and it just, the financial strain that come as a result … Our marriage broke down.”
16. Tcpt p 66(35).

The judge made clear findings, dealing with submissions that the defamatory publication had (a) caused the plaintiff’s marriage breakdown, (b) caused the plaintiff to lose his charter business, and (c) caused the plaintiff to lose his bus operation licence. [17] He identified the submissions as not supporting a claim for economic loss, but as seeking to highlight the hurt and distress suffered by the plaintiff. The judge rejected each effect, finding that none was caused by the publication.
17. Fisher at [70].
Noting that the plaintiff’s wife was “intimately concerned in the running of the bus company” and knew of the underlying circumstances relevant to the allegations, the judge concluded:[18]

“It may be that some of the factors leading to the breakdown of the marriage were similar to the factors leading to communication issues between the plaintiff and the children on the bus and other aspects. But that is a fundamentally different proposition to the submission that the publication by the defendants in these proceedings led to, or was a substantial cause of, the breakdown in the plaintiff's marriage.”
18. Fisher at [77].

With respect to the bus operating licence (and, it would appear, consequentially the charter business) the trial judge noted that the regulatory authority had undertaken an inquiry into the allegations of misconduct prior to the broadcast and had come to its own decision to suspend the plaintiff’s licence, prior to the broadcast. [19]
19. Fisher at [78]-[79].
Following his rejection of the three sets of consequences alleged, the judge nevertheless concluded that the plaintiff had suffered “significant hurt and distress and must be compensated accordingly.”[20] It is no doubt to be inferred that the hurt and distress was not aggravated by the particular consequences which had been rejected. However, that rejection had a further, unexplored relevance. The fact that the plaintiff ascribed the breakdown of his marriage, the loss of the bus driver licence and the financial strain which appears to have followed, as being the product of the defamatory broadcast would almost certainly have influenced the extent to which his hurt and distress, of which he spoke in emotional terms and which he attributed to the publication, were properly compensable. Accordingly, the rejection of those elements did not merely remove potential circumstances of aggravation, but suggested that his evidence of hurt and distress should be significantly discounted. That exercise did not appear to have been undertaken.
20. Fisher at [83].
In dealing with the substance of the various imputations, the trial judge commenced with an assessment of aspects of the plaintiff’s own explanations. The assessment was not favourable:

“[31] Throughout the proceedings, there were a number of inconsistencies in the plaintiff's evidence on matters of significance: for example, the number of times the plaintiff had used his mobile phone while the bus was in motion; the letter written to the Transport Department in response to the Peter Lewis' arm incident; and the handwritten white texta-markings on the tachometer.
[32] On the basis of the factual analysis that follows presently, I only partially accept the evidence of the plaintiff and find that in some respects the plaintiff gave a version of events that was inaccurate or untruthful. The plaintiff often avoided questions or refused to answer directly. He dissembled and was mendacious. Nevertheless, he was defamed and is, subject to issues following, entitled to damages.”

It is convenient to deal first with the category of imputations relating to driver misconduct (as opposed to the plaintiff’s relationship with the passengers). The first, imputation (b), concerned use of his mobile phone while driving the bus. The jury rejected the appellants’ case that the imputation was true, not because the plaintiff did not drive and use his mobile phone, but because the schedule of calls relied upon did not establish that he was on the mobile phone whilst travelling on a “notorious stretch of outback road”, namely Bucketts Way.
The judge was satisfied that “the plaintiff made a number of calls, as detailed on the schedule, while the bus was in motion.”[21] He held that there was “incontrovertible film evidence” to that effect. He continued:[22]

“Part of that evidence has Mr Fisher holding his phone with his right hand to his left ear, while using his left hand to change gears and his elbow to steer the bus.”
21. Fisher at [42].
22. Fisher at [43].

These express findings must have diminished significantly the hurt and distress caused to the plaintiff by this imputation. As the judge noted, he was aware of the truth of the imputation, so far as it involved such conduct.
The second imputation in this category was imputation (c), namely driving in a dangerous manner. The jury found this imputation to be true. The particulars relied upon in justification of the imputation included those relating to mobile phone use, driving without a seatbelt, leaving children unattended on the bus and, specifically in relation to this imputation, driving with a speedometer which did not function and driving “for some distance” with the front door open.

The plaintiff had accepted evidence that “for a couple of weeks in May 2011” the speedometer did not work. He said that he had made markings on the tachometer, in consultation with a named mechanic, to allow him to determine the speed at which the bus was travelling. The mechanic denied giving such advice; the judge accepted the mechanic’s evidence. [23] Because the judge had earlier stated that “details” of the particulars were “relevant also to credit”[24] it may be inferred that the plaintiff was disbelieved in his account of this matter, again a finding which might have had ramifications as to the degree of hurt and distress which the untrue imputations caused.
23. Fisher at [57].
24. Fisher at [55].
The other specific particular relevant to this imputation was driving, in October 2010, with the bus door open. The judge noted the allegation and said that the plaintiff “denied it was dangerous to drive in this manner”. [25]
25. Fisher at [58].
The appellants complained that there was no finding as to the particular, nor was it taken into account with respect to mitigation. Leaving the second point to one side, the first point is without substance. The plaintiff had admitted the conduct, but denied that he considered it dangerous. The jury having accepted that the imputation was true, the judge must be understood to have rejected the denial as unfounded.
The third imputation relevant to his conduct as a driver, imputation (d), related to his failure to wear a seatbelt. This imputation was also found to be true by the jury. The plaintiff admitted not wearing a seatbelt for a period which was, he accepted, “months” [26] because the seatbelt was broken.
26. Tcpt, p 263(20).
The trial judge noted that in an affidavit prior to the hearing, the plaintiff had acknowledged that wearing a seatbelt was important in order to comply with the law, to set an example to the children and for personal safety in case of an accident. Nevertheless, in his evidence he denied that failing to wear a seatbelt was a bad example, was dangerous, or endangered the children’s safety. [27] The judge accepted that the imputation could not “form a basis for the assessment of damage, but it is relevant to the plaintiff’s credit.”[28] The appellants submitted that the matter went further, constituting an affirmative factor in mitigation of damages.
27. Fisher at [53].
28. Fisher at [54].
The fourth imputation relevant to conduct as a driver, imputation (e), alleged that the plaintiff was a menace to the safety of others.
The trial judge gave no specific considerations to the factors underlying this imputation. However, in his conclusions he noted that the allegation was “particularly grave and capable of causing substantial damage to the plaintiff’s reputation.”[29] Prior to expressing that opinion the judge had set out six conclusions as to the imputations, resulting from his earlier analysis including, in relation to imputation (e):[30]

“Secondly, the plaintiff was alleged, by the defendants, to be a menace to the safety of others, which was untrue, but, it was true that the plaintiff drove his bus, carrying school children, in a dangerous manner.”
29. Fisher at [91].
30. Fisher at [86].

This is clearly a qualified finding. In suggesting that the broadcast had alleged that the plaintiff was a menace to the safety of others, it should not be inferred that the publication used that language; the imputation as pleaded in those terms was said to be referrable to the “whole telecast”. That was no doubt because some of the statements made in the course of the broadcast involved a degree of hyperbole. Nevertheless, the imputation was imprecise and the truth of the closely related imputation that the plaintiff drove his bus in a dangerous manner must be taken to have reduced considerably the sting of imputation (e).
There remained the two imputations involving treatment of children on the bus. With respect to imputation (f) (unjustifiably banning children from travelling and thus depriving them of the opportunity to attend school), it was not in dispute that six children had been suspended. There were policies governing suspensions, including both departmental guidelines and a policy issued by the plaintiff’s own business. Except in the case of highly dangerous or life threatening behaviour, one or two warnings were required before a suspension could occur, which, depending on the seriousness of the offence, could be a suspension for a period of 4, 8 or 14 days. [31]
31. Fisher at [47].
On 31 May 2011 six notices were issued suspending identified children for periods of between one week and four weeks. The suspensions were to take effect on the day on which the program went to air, namely 6 June 2011. Five of the six children involved appealed against their suspensions: four were overturned by the Department of Transport, and the fifth was reduced from four weeks to two weeks.
The trial judge did not seek to explore why the jury had found the imputation to be untrue. A ban reversed on appeal would seem to satisfy the ordinary meaning of an “unjustifiable ban”. However, the jury may not have been satisfied that the bans deprived the individual children of the opportunity to attend school. As the judge noted, because the suspension notices only related to travel on the plaintiff’s service, “other alternative transport was available to the school children”. [32] In short, the allegation as to the plaintiff’s conduct was true, but the consequence alleged to arise from it was not true.
32. Fisher at [46].
The last relevant imputation, (g), was that the plaintiff “stranded children” who were passengers on the bus. Regulations governing the commercial bus service required that the driver not to leave the bus “without reasonable cause.”[33] The plaintiff agreed that he had left the bus unattended “for less than a minute” to buy a newspaper and, on another occasion, to go the bathroom. [34] The judge recounted that evidence without indicating whether he accepted it or whether it constituted a legitimate absence which could not constitute a “stranding” of passengers, with the implication of impropriety.
33. Fisher at [59], referring to the Passenger Transport Regulation 2007 (NSW).
34. Fisher at [59].
In relation to this imputation, the judge also made reference to a boy who, on 30 May 2010, had been ordered off the bus after he had “mooned or bared his backside at another bus.”[35] The judge recorded the plaintiff’s evidence that this had occurred five times previously and, after requiring the boy to leave the bus at a school, not his own, the plaintiff had told him he would call the police. There was apparently evidence that the boy, who was 75km from his home, absconded. The plaintiff did not call his parents, as he did not have their number, “but says he asked a duty teacher … to contact his parents.”[36] Again, there is absence of findings. The judge did not state whether he accepted all of the evidence given by the plaintiff, particularly in stating what he “says”, as if its reliability might be uncertain. There was no finding as to whether the teacher had the boy’s home number (he not being a pupil at that school), nor whether he in fact contacted them.
35. Fisher at [60].
36. Fisher at [60].
Specific findings in respect of this conduct could have been important, because of the significant difference between the driver leaving the bus unattended and the driver requiring a passenger to leave the bus. Although both could be described as “stranding” children, precise findings were necessary to determine the seriousness of the imputation. In fact, the pleading referred to a passage in the broadcast in which the reporter identified that two parents were angry because their children “had been stranded with the driver leaving to buy a paper, go to the toilet or stop dead with a broken gear box.” While the term “stranded” is dramatic, the three instances proffered would be unlikely to have any significant impact on the driver’s reputation as such.
The appellants noted that, in this context, the judge also addressed a contextual imputation pleaded by them by way of defence, the truth of which was not accepted by the jury. The contextual imputation alleged that the plaintiff’s conduct as a bus driver was so poor that he was not a fit and proper person to be allowed to drive a bus carrying schoolchildren, by reference to two incidents. One involved a boy who was sick on the bus on the way to school. There were different accounts of what then happened, namely whether the plaintiff required the sick boy to clear up his own vomit, or whether he asked older children to do so, but it was not in dispute that he did not stop the bus. The judge also appears to have accepted that he did not make arrangements to contact the parents, until his wife, learning of the incident, did so that evening.
The second incident related to a boy who, it was suggested by the plaintiff, had opened a window after being told to close it. There was an allegation that the plaintiff had told the boy, “if you do that one more time, I will break your arm off.”[37] This incident had apparently given rise to a complaint to the Department, resulting in the plaintiff writing a letter which he acknowledged in cross-examination was only partly true. The judge said the incident “is not relevant to damages and only goes to credit.”[38]
37. Fisher at [63].
38. Fisher at [65].
The appellants’ concern in relation to the manner in which the contextual imputation was addressed was twofold; first they said that their failure to satisfy the jury as to the truth of the contextual imputation was irrelevant to the question of damages; secondly, there was no indication as how the partly false letter to the Department might affect the assessment of damages, nor as to the possible relevance of the adverse credit finding.
The list of factors, amongst which the contextual imputation appeared, was described by the trial judge as containing matters “particularly relevant to the assessment.”[39] Having set out the specific factors, the judge then said that “[t]he defamatory imputations … the effect of which are set out in the immediately preceding paragraphs, amount to serious allegations of misconduct on the plaintiff’s part and are significant.”[40] It is difficult to avoid the conclusion that the contextual imputation, which was included in the list, constituted a matter taken into account in assessing damages. The appellants contended that this would have been an error. In Holt v TCN Channel Nine Pty Ltd, [41] this Court addressed a complaint by a plaintiff that he should have been allowed to rely upon “the contextual imputations not shown by the [defendants] to be true as augmenting his damages”. The Court held that it would be “a subversion of the litigation process for him to be awarded damages in respect of conduct of the defendants of which he did not complain.” The appellants’ complaint in this regard (ground 3 of the appeal) should be accepted.
39. Fisher at [83].
40. Fisher at [91].
41. (2014) 86 NSWLR 96; [2014] NSWCA 90 at [22]-[23] (Macfarlan JA; Gleeson JA and Sackville AJA agreeing).

Missing findings

Next, it is convenient to address the complaint that the trial judge did not make findings of fact on seven matters [42] which had been identified in written submissions before the trial judge, with appropriate references to the evidence relied upon.
42. The submissions at trial contained eight, but one was not pressed.
The first three findings sought related to use of the mobile phone whilst driving the bus. A fair reading of the judgment at [33]-[43] demonstrates that the judge made the critical findings sought. These complaints must be rejected.
Finding four identified five elements of dangerous conduct as a school bus driver, namely (i) driving with the door open, (ii) leaving the bus, (iii) driving without a speedometer, (iv) asking children to clean up vomit while the bus was moving on a freeway, and (v) not wearing a seatbelt. As to (i), (iii) and (v), the findings sought were within the matters accepted as true by the jury. It is not in doubt that the judge accepted these findings. With respect to leaving the bus, it is true that the judge referred to the incidents without making express findings. However, neither was of significance in diminishing the plaintiff’s reputation. So far as (iv) was concerned, it is true that the judge dealt with it in the context of the contextual imputation, the truth of which was not established, without apparently making findings. Nevertheless, it may be inferred that the judge did accept that the boy vomited and that one or more child or children were asked to clean the vomit up whilst the bus continued on the freeway. The principal facts appear to have been accepted by the plaintiff; his denial that requiring the children to clean up the vomit was dangerous, because he was driving “slowly” and that the bus was nearing the exit off the freeway, indicated that the principal elements of the complaint were established, and that the issue was as to the plaintiff’s insight into his own conduct.
The contextual imputation was drawn in broad terms, namely conduct as a bus driver which was so poor that he was not a fit and proper person to be allowed driving a bus carrying schoolchildren. The reason for drawing it in those terms may have been to reflect the fact that, following the suspension, on 14 July 2011 the Department cancelled the plaintiff’s bus driver licence and, following a review in the Administrative Decisions Tribunal, the decision was upheld – on the ground that the plaintiff was not a fit and proper person to hold such a licence. (A further appeal was withdrawn.) In any event, the rejection of the contextual imputation did not preclude the appellants relying upon the specific evidence led in support of it, nor in seeking findings from the trial judge in relation to mitigation of damages, based on that evidence.
On the basis of the same material, the appellants sought findings that the plaintiff lacked insight into his responsibilities as a driver (and in particular as the driver of a school bus) and represented a significant danger to himself, to passengers and other road users. In addition to the matters noted above, the judge noted the plaintiff’s denial that it was dangerous to drive with a bus door open. However, he made no finding in the terms sought by the appellants.
The seventh finding sought related to the plaintiff’s threat to break a child’s arm and take him to the police station, followed by the plaintiff throwing rubbish after him as he left the bus, followed by his denial in a letter to the department that this had occurred. This was the second of the matters dealt with by the trial judge in considering the contextual imputation.
The absence of a specific finding may have been an oversight. The evidence recounted by the trial judge [43] was all admitted by the plaintiff in cross-examination. [44] Indeed, the finding is implicit in the final remark that the incident was “not relevant to damages and only goes to credit.” The real complaint, addressed below, follows from that limited use to which the trial judge put the material.
43. Fisher at [63]-[65].
44. Tcpt, pp 103-108; 124.
The final finding sought related to the incident of leaving a boy at a school (not his own) because of misbehaviour. Again, the facts were succinctly stated by the judge and included an implicit finding that the evidence was accepted, with the possible doubt as to whether the plaintiff did in fact ask a duty teacher to contact the boy’s parents. It is true that the appellants invited the judge to make a finding that the claim in relation to having a teacher (from another school) call the boy’s parents was implausible, was belatedly raised and should not be accepted.
The incident was not necessarily insignificant. There was evidence from Mrs Fisher that the boy’s father had called her that night to complain, to which her response had been, “Brian shouldn’t be driving the bus. He has no idea what to do with the kids. He can’t handle them”. [45] The trial judge might not have accepted the weight which the appellants sought to put on the incident, but it was not clearly trivial and the submission, accompanied by references, should properly have been addressed.
45. Tcpt, p 372(43).
It follows from the foregoing consideration that most of the individual findings sought by the appellants were made, either expressly or by implication. Assuming that the other proposed findings were rejected (rather than not considered) it is necessary to address the next question, which is whether, with respect to matters which were established, their significance in mitigation of damages was disregarded.

Disregarding relevant matters

The substance of the argument in this respect turned upon the statement of the trial judge in the following terms:[46]

“Because I have dealt with the nett imputations …, I do not need to allow further for any mitigation.”
46. Fisher at [107].

In Gacic v John Fairfax Publications Pty Ltd [47] McColl JA discussed the circumstances in which evidence properly before the court on other issues could be relied upon by a defendant in mitigation of damages. [48] Those principles were not in dispute and need not be restated; however, as to the use which could be made of such evidence in mitigation of damages McColl JA stated: [49]

“One approach suggests that the tribunal of fact compare the effect of the mitigating evidence with the defamatory effect of the matter complained of to determine the extent to which the former mitigates the plaintiff’s damages.”
47. [2015] NSWCA 99.
48. Gacic at [190]-[200].
49. Gacic at [199] (citation omitted).

The exercise implicit in that comparison is a global one; that is, as one amount of damages will be awarded as consolation for the injury to reputation and, to the extent necessary, to vindicate the harm done to the plaintiff’s reputation, so the effect of mitigation will be applied to the overall impact of the defamatory imputations.
That is not what happened in the present case. Rather, it should be inferred from the reference to “netted imputations” that the trial judge considered the material relied upon by the appellants in mitigation by reference to specific imputations. Thus, in respect of imputation (b), the judge found that the plaintiff used his mobile phone while driving the bus, but did not do so on a notorious stretch of outback road. With respect to imputation (e), the judge found that the plaintiff was not a menace to the safety of others, but did drive his bus, carrying schoolchildren, in a dangerous manner.
There may be circumstances in which such an approach is permissible, or even preferable. However, there is a danger in that approach which appears to have materialised in the present case. In assessing damages, in a system in which a jury assesses liability, but the judge must determine the damages, it will often be necessary for the judge to identify, having regard to the evidence which the jury considered, on what basis particular findings were made. Otherwise the judge must find the facts, so far as the evidence allows, in the usual way. This is an exercise not dissimilar to that required of a judge following a jury trial for an indictable offence, who is then required to sentence an offender who has been found guilty. [50] In any event, imputations drafted in general and colourful language (“the plaintiff is a menace to the safety of others”) must inevitably be evaluated for the harm caused, both by reference to the nature of the “menace” and the aspect of the plaintiff’s reputation which is at risk. If the trial judge in fact undertook that exercise, it does not appear from the reasoning. Indeed, there were indications to the contrary, in the several passages in which the judge identified particular findings as relevant to credit, but not relevant to damages.
50. Filippou v The Queen [2015] HCA 29; 89 ALJR 776 at [70]-[72] (French CJ, Bell, Keane and Nettle JJ), and at [74] (Gageler J agreeing).

Further, the concept of a “nett” imputation will tend to underestimate the value to a defendant of an imputation successfully defended on the basis of justification or truth. That too appears to be a risk which materialised in the present case.
For these reasons, the appeal should be upheld and the assessment of damages set aside.

Reassessment of damages or remittal?

The appellants submitted that, if error were identified, the Court should assess damages for itself, rather than remit the matter for a further trial (albeit one limited to the issue of damages). On the other hand, the plaintiff submitted that a remittal would be necessary because of the adverse credit finding that the plaintiff was inaccurate or untruthful “in some respects” and “often” avoided questions or refused to answer directly. The inference to be drawn from such findings was that, in other respects, the plaintiff was accepted, but it would not be possible for this Court to assess the plaintiff’s evidence.
There are three reasons which favour the conclusion that this Court should dispose of the matter. First, the amount in issue is not large in relative terms: that is, the costs of a further trial, even one limited to damages, are likely to be comparable with (or even exceed) the most likely award. Secondly, and related to the first point, it will not be possible to restrict greatly the scope of the trial. The damages hearing following the jury trial took a day. However, if it were necessary to deal with the whole of the material relevant to damages, most of which derived from the trial on liability before the jury, that period would be significantly extended. (The jury trial ran for some seven days.)
Thirdly, it is not entirely true that this Court is left without a basis for identifying those parts of the plaintiff’s evidence which were discredited and those which were not. (Indeed, were the plaintiff’s submission in this respect entirely correct, it would itself constitute a ground for interfering with the judgment.) For the reasons set out above, it is tolerably clear which parts of the plaintiff’s evidence were accepted and which were rejected, at least in broad terms. Reference to passages in the transcript allows greater confidence in that exercise than a bare reading of the judgment. Not only did the trial judge himself refer to passages in the transcript in relation to specific findings, but it is reasonably straightforward to ascertain what other passages he may have had in mind by reference to the submissions of the parties on particular topics.
In these circumstances, the Court could not be satisfied that a failure to remit would give rise to a substantial miscarriage of justice, for the purposes of the Uniform Civil Procedure Rules 2005 (NSW), Pt 51, r 51.53, absent which the Court should not order a new trial. Further, in considering such a step, the Court is required to have regard to any disproportion between the costs involved in one course and another and the amount in issue, pursuant to Pt 6 of the Civil Procedure Act 2005 (NSW).

Reassessment of damages

An assessment of damages by this Court should cover three broad considerations. The first must be the seriousness of the defamatory imputations which were not justified as true. The second is the effect of those matters adverse to the plaintiff’s reputation as the driver of a school bus, in terms of that which he acknowledged (or did not acknowledge), findings of fact inconsistent with fit and proper behaviour in that regard and the effect of those findings on the imputations. Thirdly, it is necessary to assess the hurt and distress which may have been caused by the defamatory publication in the context of other factors causing hurt and distress contemporaneously.
As to the seriousness of the imputations, the more serious group of imputations where those addressed first above, namely those directed to his conduct as a driver, rather than his relationship with the passengers. As noted above, viewed in the abstract, the imputations describing the plaintiff as a menace to the safety of others was potentially the most serious. However, it was not based on any particular allegation of misconduct and must therefore be assessed in the context of the other allegations.
Again viewed in the abstract, the second most serious imputation was of driving a bus carrying schoolchildren in a dangerous manner. In the ordinary meaning of the language used, that conduct would include driving while speaking on a mobile phone and driving without a seatbelt, as well as the specific items discussed above, being the driving without a working speedometer and driving with the door open. Importantly, this imputation was found to be true, as was the separate specific imputation involving driving without a seatbelt. In the result, the only conduct covered by these imputations which was not true was using a mobile phone while travelling on Bucketts Way, identified as a “notorious stretch of outback road”. Thus, although the appellants established that the plaintiff was a poor driver in the respects discussed above, they failed to establish that his risky driving extended to the most difficult stretch of road on the route routinely travelled, as implied by the broadcast. Such conduct on that stretch of road could have rendered him a menace to others. This constituted a significant untrue defamatory imputation.
The second group of imputations related to the conduct with the children. Both imputations falling within this category were tolerably serious, viewed in the abstract. Neither bore quite the same degree of disapprobation when understood in the context of the defamatory broadcast. Both have the same sting, namely improperly preventing children getting from their homes to their schools.
The trial judge dealt with the question of stranding by reference to the brief periods for which the driver left the bus, and the removal of one student from the bus at a school which was not his school, with a threat to call the police. While, for the reasons noted above, it is understandable that the jury found the imputation not to have been justified, it is also clear that the plaintiff’s conduct did not reflect well on his reputation as a driver. (The pleading referred only to occasions when the driver left the bus, not leaving a particular child at the wrong school.) However, read in the context of the publication as a whole, the imputation was not of serious misconduct.
As explained above, the facts demonstrated that the plaintiff had unjustifiably banned schoolchildren from travelling on his bus. It was almost certainly the second limb of the allegation which was not accepted by the jury, namely that he deprived them of the opportunity to attend school, by that conduct. The fact that there were alternative methods of travel does not justify otherwise unjustifiable conduct, but merely mitigates possibly serious consequences. The jury was entitled to find that the broadcast included an allegation with respect to the consequences, and accordingly there was a significant defamatory sting to the allegation.
Taking these various imputations into account, the defamation was significant, and might, taken in isolation, have warranted the award of damages made by the trial judge. However, there were significant factors which diminished that assessment. First, the finding of the trial judge that the plaintiff gave inaccurate or untruthful versions of events, often avoided questions or refused to answer directly, dissembled and was mendacious, must diminish the seriousness of the affront to his reputation. His evasiveness extended to his difficulty in explaining inconsistencies in statements made on different occasions, and his unwillingness to acknowledge that aspects of his conduct were potentially dangerous. For example, when asked whether he knew it was expressly forbidden by the Passenger Transport Regulations to drive with the door open, he agreed that he knew that he was not “supposed to drive with the door open”. When asked if he agreed that it was an obvious potential safety hazard he said, “I don’t know I agree with that, but in any case, no, I don’t agree with that.” [51]
51. Tcpt, p 265(30)-(35).
After agreeing that he had driven with a mobile phone held against his left ear with his right hand, whilst changing gears with his left hand and hold the steering wheel with his right elbow, he nevertheless disagreed that it was dangerous. [52] In the event of an expected risk, he explained that he could simply have dropped the mobile phone. [53]
52. Tcpt, p 339(30).
53. Tcpt, pp 192(15) and 238-239.
These answers directly affected the seriousness of the imputations with respect to his reputation as the driver of a school bus.
Finally, he was cross-examined at some length as to his claims that the broadcast caused the loss of his bus driver’s licence, the breakup of his marriage and the loss of his business. The plaintiff placed much weight on these events when describing his hurt and distress. He expressed his views on a Facebook entry which was put to him in cross-examination: [54]

“Q. Mr Fisher, can I just put this to you, that to refer to a girl who used to be on your school bus when she was 12 or 13 and who is now 15 as a ‘shithead narcissistic arsehole’ is a pretty vicious thing to do?
A. I think it – it – I think it just expresses, you know, what – you know, what their behaviour caused. They caused – their conduct, that family, they were engaged in a campaign against us and it brought about the demise of my business, everything I worked for. I mean, I worked since I was 14, I started pumping gas in a service station, and now I am facing bankruptcy. The bank was about to kick us out of our home yesterday. There is a writ of possession on the family home. My two boys and I are facing homelessness. You have got no idea what we have been through. … I have had my whole life ruined.
…”
54. Tcpt, p 161.

The answer being non-responsive, the question was then repeated and the plaintiff answered, “I don’t know if I would agree with vicious.”
The trial judge rejected the proposition that the broadcast resulted in the loss of his licence, or the breakup of this marriage, or the destruction of his business. Yet it is tolerably clear from page after page of his evidence that his hurt and distress resulted from the conduct of the children and their parents, which he asserted led to those results. That the results must have been distressing in a high degree can be accepted without hesitation. However, the finding that the broadcast did not lead to those results requires the conclusion that the plaintiff’s hurt and distress was almost entirely the product of other factors, even if they flowed from the same underlying conduct.
There is no doubt that the appellants had an arguable case that an appropriate award of damages would have been nominal or very low. However, that is not a view which can be adopted with any confidence by this Court, which is reliant upon the transcript of the trial and the findings made by the trial judge. Accordingly, such a conclusion cannot be reached without a retrial, which the appellants do not seek. The appropriate course is to award the plaintiff a modest amount for a limited defamation, the consequences of which were almost entirely swamped by other events. An appropriate award is $25,000.

Costs

As it is necessary to revisit the costs awarded by the trial judge in the light of this conclusion, it is not necessary to consider whether the plaintiff required leave to bring a cross-appeal limited to costs, nor whether leave should be granted, if required.
Where defamation proceedings are successful, and costs are to be awarded to the plaintiff (the general rule) the court must consider whether the defendant unreasonably failed to make a settlement offer, or agree to a settlement offer proposed by the plaintiff, and if so satisfied, award costs on an indemnity basis, unless also satisfied that the interests of justice require otherwise. [55]
55. Defamation Act, s 42(a).
The plaintiff has been successful only in a limited sense. The recovery of the award of damages proposed above following a Supreme Court hearing which ran for seven days before a jury cannot be regarded as an entirely favourable outcome, although much of the time was taken by the evidence (both in chief and in cross-examination) of the plaintiff. In deciding whether to award costs in favour of the plaintiff, the Court should take into account the fact that a reasonable offer was made by the plaintiff (to settle for $40,000) which, although the plaintiff has not achieved that end, was not an exorbitant demand. Given the likely costs of the trial, it would have been reasonable for the defendants to accept the offer, although, on the other hand, their conduct in failing to do so cannot be described as unreasonable. There was no evidence before this Court that the appellants had made an offer at any stage of the proceedings.
In considering whether to award costs, the Court is also entitled to take into account the findings made by the trial judge as to the conduct of the plaintiff, both in giving evidence and in making inconsistent statements on different occasions.
Taking into account these factors relating to the trial and the relative degrees of success of both parties at trial and on appeal, the appropriate course is to make no order as to the costs of either the trial or the appeal. The orders made by the trial judge with respect to costs should be set aside.

Orders

The copy of the terms of judgment and orders issued by the Clerk of the Court and contained in the appeal papers indicates that the orders were made on 31 December 2014 and entered on 27 January 2015. They were in fact entered on 31 December 2014. For some reason which remains obscure, they were re-entered (probably inappropriately) on the later date. For present purposes, they will be identified as orders made on 31 December 2014.
On 17 November 2014, the trial judge made six orders, of which four were vacated by the later orders. The first order was simply to give judgment for the plaintiff; the second order fixed the damages at an amount of $125,000.
The orders made on 31 December 2014, apart from vacating orders (3)-(6) made on 17 November, included an award of interest on the damages, which should stand, although the calculation will be affected by the new amount awarded. Order (2) also awarded interest from the date of judgment, in accordance with the Uniform Civil Procedure Rules; those rules have effect of their own force and need not be referred to in a consequent order. Orders (3) and (4) dealt with the costs of the proceedings at trial and should be set aside. Order (5) provided that the proceedings be otherwise dismissed. The effect of this order was to dispose of other claims made by the plaintiff which had not been granted. It should stand.
The Court should make the following orders:

Allow the appeal and

set aside order (2) made on 17 November 2014 (requiring the defendants to pay the plaintiff damages in the sum of $125,000);

set aside orders (2)-(4) made on 31 December 2014.

In place thereof, order that the defendants pay the plaintiff damages in the sum of $25,000 together with interest calculated at the rate of 3% from 6 June 2011 until 17 November 2014, such order to effect from 17 November 2014.

Make no order as to the costs of the trial, the appeal and the cross-appeal.

SIMPSON JA and TOBIAS AJA: The facts relevant to this appeal are fully set out in the judgment of Basten JA, which we have read in draft.
The quantification of damages was not an easy task. The primary judge had to discard from consideration the two imputations that were justified – that is, that the plaintiff drove his bus carrying school children in a dangerous manner, and that he drove a bus containing 40 school children without wearing a seatbelt. (As will appear below, that is not the same as saying that he had to discard from consideration the evidence on which the jury found that those imputations were true.)
As against those, there were four imputations the appellants failed to justify, all of them serious, and all of them more serious than those that were shown to be true.
The appellants pleaded nine grounds of appeal. Six raised specific complaints about the manner in which the primary judge treated the issue of mitigation of damages. Mitigation of damages was, perhaps, the most complex issue in the assessment exercise. Adding to the complexity of the exercise was the need to disentangle the plaintiff’s evidence of the hurt and distress he experienced that could be related to the publication from that which arose from his marriage breakdown, the loss of his bus driver’s licence, and the financial strain consequent upon that circumstance, all of which the primary judge found were not causally related to the publication.
By Ground 3, the appellants complain that the primary judge erroneously took into account, in the overall assessment of damages, the contextual imputation pleaded by the appellants, which the jury found was conveyed and defamatory, but not proved to be true. That he was not entitled to do so is established by the decision of this Court in Holt v TCN Channel Nine Pty Ltd [2014] NSWCA 90; 86 NSWLR 96. We agree with Basten JA (at [46]) that Ground 3 of the appeal should be upheld.

Mitigation of damages

Grounds 1, 2 and 4-7 raised various complaints about the manner in which the primary judge dealt with the evidence adduced by the appellants in support of their defence of justification.
The primary judge was entitled, and indeed bound, in considering the damage done to the plaintiff’s reputation by the publication of the unjustified imputations, to take into account the facts proved by the appellants in support of that defence: Pamplin v Express Newspapers Ltd [1988] 1 WLR 116. The principles stated in Pamplin have been adopted in this jurisdiction: Holt at [26]-[30]; John Fairfax Publications Pty Ltd v Zunter [2006] NSWCA 227; Gacic v John Fairfax Publications Pty Ltd [2015] NSWCA 99, although the relevance of such evidence is to be confined to “the relevant sector” of the plaintiff’s reputation. In this case no issue arises in that respect. All the evidence in question concerned the plaintiff’s reputation and conduct as a driver of a school bus.
In some cases, as Basten JA has shown, the facts were incontrovertible (for example, the plaintiff’s mobile telephone use while driving), or were admitted by the plaintiff (leaving the bus to use the toilet facilities, or to buy a newspaper). Where the facts were not incontrovertible or admitted, the primary judge had to make relevant findings, not inconsistent with the jury verdict. This he largely did. In respect of some of the imputations, the exercise essentially disclosed partial justification of the imputations. In each case, it was the more serious aspect of the imputation that was not proved to be true. By way of example, it could confidently be accepted that the plaintiff drove the bus on occasions while using a mobile telephone; what was not shown was that he did so on “a notorious stretch of outback road”; and, while the evidence showed that the plaintiff unjustifiably banned school children from travelling on his bus, it did not show that he thereby deprived them of the opportunity to attend school.
To the extent that the evidence of the plaintiff’s conduct could be used in mitigation of damages, fairness dictated that counterbalancing evidence given by him explaining that conduct also be taken into account. The plaintiff gave evidence, apparently accepted by the primary judge (notwithstanding serious criticism of the plaintiff’s veracity), concerning the conduct of some of the children on the bus. That evidence casts the evidence of the plaintiff’s conduct in a somewhat different, and more favourable, light.

Two of the imputations that the appellants failed to justify were particularly serious. These were imputations (e) and (g), that the plaintiff was a menace to the safety of others, and that he stranded children who were passengers on the bus. As Basten JA has pointed out, the particulars given in support of the imputation of dangerous driving were the use of the mobile telephone, driving without a seatbelt, leaving children unattended on the bus, driving with a non-functioning speedometer, and driving, “for some distance”, with the front door open. But leaving children unattended on a stationary bus and driving with a non-functioning speedometer of themselves do not support an imputation of dangerous driving, if that is intended to refer to putting the children on the bus at risk. Driving without a seatbelt, while setting a bad example to school children, generally does not cause danger to anybody except the driver, and does not establish that the plaintiff drove dangerously.
The particulars given in support of imputation (g), that the plaintiff “stranded” children who were passengers on his bus, were twofold. The appellants called evidence that, on two occasions, the plaintiff had briefly left the bus containing the children, once to use the toilet facilities, and once to purchase a newspaper; and that, on another occasion, the plaintiff had removed one child from the bus and left him at a school (that was not his) at a considerable distance from his home.
These incidents were insufficient to persuade the jury that the plaintiff “stranded” children. The two instances of briefly leaving the children unattended do little to diminish the seriousness of the imputation of stranding. The incident of removing a child and leaving him at a school was significantly more serious, and does have an impact on the manner in which damages ought to be assessed in respect of that imputation. Again, however, that assessment must also take into account the plaintiff’s explanation. He said that the child in question had “mooned”, or bared his buttocks, at another bus. Although he did not say so expressly, it appears that his Honour accepted that evidence.
Evidence was given in support of the truth of imputation (h), (that the jury held was not conveyed) to the effect that the plaintiff unjustifiably fought with and bullied children on the bus. Specifically, evidence was called of an incident in which the plaintiff had threatened one child “I will break your arm off”. The primary judge appears to have accepted this evidence, and, plainly, such an incident is relevant to the assessment of the plaintiff’s damages. So, too, is the plaintiff’s account of what precipitated the incident. He said (and the primary judge appears to have accepted) that the child had repeatedly opened a window on the bus, after being told by the plaintiff to close it.
Notwithstanding that explanation, the incident itself is relevant to the assessment of damages, in favour of the appellants, as a mitigating circumstance. The primary judge erroneously took it into account only as relevant to the plaintiff’s credit.
The matters that establish the truth of the imputation of dangerous driving are, in truth, confined to the use of the mobile telephone (which was proved to have occurred on a limited number of occasions) and driving with the front door open, which he was said to have done on only one occasion, and for “some” (unspecified) distance. The imputation that the plaintiff was a “menace” to others was, by contrast, an imputation of habitual conduct, substantially more serious, and not significantly diminished by what was proved in relation to the dangerous driving imputation.
By Ground 7 the appellants complain that the primary judge erroneously limited his consideration of two other matters (besides the threat of violence to a child) to the question of credit. These were the evidence of the plaintiff’s failure on occasions to wear a seatbelt, and the evidence of dangerous driving. We have already indicated that these matters were relevant to the assessment of damages, in that their truth diminished the extent to which the plaintiff could be treated as a person of unblemished reputation. It was an error to disregard the evidence in that assessment.
In accordance with the above, we are of the view that two of the appellants’ grounds ought to be upheld. The first is Ground 3 (taking into account the contextual imputation). However, in our opinion, that circumstance could have had no more than a minimal impact on the assessment of damages. The second ground we would uphold is Ground 7, asserting error in confining the evidence of the threat to break a child’s arm off, the failure to wear a seatbelt, and the evidence of dangerous driving (use of a mobile telephone and driving with the door open) to questions of credit. These errors are of sufficient significance to warrant a reassessment of damages.
That being so, Ground 8 can be dealt with briefly. By Ground 8, the appellants complain that the primary judge erroneously accorded “significant emphasis” to “the grapevine effect”, in the absence of evidence to support it.
We would reject this ground. The very point of what is known as “the grapevine effect” is that the spread of the defamation cannot be precisely quantified. In this case, the plaintiff operated his bus in a rural community. It is more than speculation to conclude that awareness of the program would quickly have become widespread.
The final ground (Ground 9) was that the quantification of damages at $125,000 was manifestly excessive. In this respect, we have concluded that, absent the mitigating evidence (that is, were the plaintiff to be entitled to be treated as a person of unblemished reputation) that award would not have been manifestly excessive, having regard to the reach of the telecast, the nature of the community in which the plaintiff operated, and the nature of the imputations – in particular, the imputation that he was a menace to the safety of others and that he stranded children who were passengers on his bus.
We agree with Basten JA that it is appropriate for this Court to undertake the exercise of reassessment. The question is the extent to which the award ought to be mitigated by reason of the diminution in the plaintiff’s reputation by reason of the facts proved by the appellants. These may be summarised briefly as follows:

driving a bus without wearing a seatbelt;

driving a bus while using a mobile telephone;

unjustifiably banning school children from the bus (but taking into account the plaintiff’s explanation);

leaving a child at a school many kilometres from his home;

threatening a child with violence.

These are significant issues of mitigation.

We are of the view that the award of damages made by the primary judge ought to be reduced by 40 per cent to take account of the whole of the mitigating circumstances that yields an award of damages of $75,000.
That makes it necessary to consider the plaintiff’s cross-appeal.

Costs

The plaintiff filed a Notice of Cross-Appeal with respect to the award of costs. By s 101(2)(c) of the Supreme Court Act 1970 (NSW) such an appeal lies to this Court only by leave.
The relevant circumstances are these. On 6 February 2014 the plaintiff made an Offer of Compromise in accordance with UCPR 42.14 in the amount of $40,000. By UCPR 42.14(2), where an offer is made by a plaintiff and not accepted by the defendant, and the plaintiff obtains an order or judgment no less favourable, the plaintiff is entitled (unless the court orders otherwise) to an order that costs be assessed on an indemnity basis from the day following the day on which the offer was made (that is, in this case, 7 February 2014).
The plaintiff met the criterion for an award of indemnity costs, in that the award of damages exceeded the offer. So too does the award of damages that we propose.
The plaintiff, accordingly, sought an order that his costs be assessed on that basis.
He sought, alternatively, that the whole of the costs be assessed on an indemnity basis in accordance with s 40 of the Defamation Act 2005 (NSW).
Section 40 relevantly provides as follows:

“40  Costs in defamation proceedings
(1)  In awarding costs in defamation proceedings, the court may have regard to:
(a)  the way in which the parties to the proceedings conducted their cases (including any misuse of a party’s superior financial position to hinder the early resolution of the proceedings), and
(b)  any other matters that the court considers relevant.
(2)  Without limiting subsection (1), a court must (unless the interests of justice require otherwise):
(a)  if defamation proceedings are successfully brought by a plaintiff and costs in the proceedings are to be awarded to the plaintiff - order costs of and incidental to the proceedings to be assessed on an indemnity basis if the court is satisfied that the defendant unreasonably failed to make a settlement offer or agree to a settlement offer proposed by the plaintiff …”

On 31 December 2014 the primary judge concluded, in the language of s 40(2)(a), that the appellants did not unreasonably fail to accept the settlement offer made by the plaintiff. He then ordered that the appellants pay the plaintiff’s costs, up to and including 6 February 2014, on the ordinary basis. He went on to order:

“The [appellants] shall pay 85% of the plaintiff’s costs of and incidental to the proceedings … on an indemnity basis, on and from 7 February 2014.”

There is, if this order is to be taken literally, a lacuna; no provision is made for the payment of the 15 per cent of the costs from 7 February 2014 that are not to be assessed on an indemnity basis. That, in our opinion, was an oversight and ought to be corrected.
It is difficult to discern the basis on which the primary judge declined to order that the whole of the costs from 7 February be assessed on an indemnity basis. He appears to have taken into account that he had found that some of the evidence given by the plaintiff was untrue. However, he also held that that did not add in any significant way to the duration of the proceedings.
In our opinion, the plaintiff ought to be granted leave to appeal against the order for costs. In lieu thereof, this Court should order that the appellants pay the plaintiff’s costs of the proceedings (at first instance) on the ordinary basis up to and including 6 February 2014, and thereafter on an indemnity basis.
We therefore propose the following orders:

Appeal allowed;

The order of 17 November 2014 that the defendants pay to the plaintiff damages in the sum of $125,000 be set aside;

In lieu thereof, the defendants pay to the plaintiff damages in the sum of $75,000;

Grant leave to the respondent to appeal against Orders 3 and 4 of the orders made on 31 December 2014;

Set aside Orders 3 and 4 of the orders made on 31 December 2014;

In lieu thereof, order that the appellants pay the respondent’s costs of and incidental to the proceedings, to be assessed on the ordinary basis up to and including 6 February 2014, and on an indemnity basis on and from 7 February 2014;

Order that each party pay his or its own costs of the appeal and the summons for leave to appeal.

**********

Endnotes

Decision last updated: 22 December 2015

Medium Neutral Citation:	Channel Seven Sydney Pty Ltd v Fisher [2015] NSWCA 414
Hearing dates:	3 November 2015
Decision date:	22 December 2015
Before:	Basten JA at [1]; Simpson JA and Tobias AJA at [90]
Decision:	(1) Appeal allowed. (2) The order of 17 November 2014 that the defendants pay to the plaintiff damages in the sum of $125,000 be set aside. (3) In lieu thereof, the defendants pay to the plaintiff damages in the sum of $75,000. (4) Grant leave to the respondent to appeal against Orders 3 and 4 of the orders made on 31 December 2014. (5) Set aside Orders 3 and 4 of the orders made on 31 December 2014. (6) In lieu thereof, order that the appellants pay the respondent’s costs of and incidental to the proceedings, to be assessed on the ordinary basis up to and including 6 February 2014, and on an indemnity basis on and from 7 February 2014. (7) Order that each party pay his or its own costs of the appeal and the summons for leave to appeal.
Catchwords:	APPEAL – defamation – assessment of damages – amount in issue relatively small – unfavourable credit findings with respect to the plaintiff by the trial judge – whether remittal required – whether substantial miscarriage of justice if no new trial ordered – Uniform Civil Procedure Rules (NSW), r 51.53 – relevance of the costs of new trial and determining the matter of appeal – Civil Procedure Act 2005 (NSW), Pt 6 DEFAMATION – assessment of non-economic damages – mitigation of damages – effect on plaintiff’s reputation of imputations found to be true in whole or in part – whether judge impermissibly “netted” imputations – whether relevant findings not made – contextual imputation found not to be true by the jury – whether the trial judge impermissibly took contextual imputation into account COSTS – defamation – damages reduced on appeal – plaintiff’s offer rejected by defendants – where unfavourable findings made by trial judge about plaintiff’s conduct at trial – whether to order costs where lengthy trial resulted in low award
Legislation Cited:	Civil Procedure Act 2005 (NSW), Pt 6 Defamation Act 2005 (NSW), ss 25, 34, 38, 40 42 Supreme Court Act 1970 (NSW), s 101 Uniform Civil Procedure Rules 2005 (NSW), rr 42.14, 51.53
Cases Cited:	Carson v John Fairfax & Sons Ltd (1993) 178 CLR 44 Filippou v The Queen [2015] HCA 29; 89 ALJR 776 Gacic v John Fairfax Publications Pty Ltd [2015] NSWCA 99 Holt v TCN Channel Nine Pty Ltd (2014) 86 NSWLR 96; [2014] NSWCA 90 John Fairfax Publications Pty Ltd v Zunter [2006] NSWCA 227 Pamplin v Express Newspapers Ltd [1988] 1 WLR 116
Category:	Principal judgment
Parties:	Channel Seven Sydney Pty Ltd (First Appellant/First Cross-Respondent) David Richardson (Second Appellant/Second Cross-Respondent) Brian Stanley Fisher (Respondent/Cross-Appellant)
Representation:	Counsel: Mr R G McHugh/Mr M Richardson (Appellants/Cross-Respondents) Mr R Rasmussen (Respondent/Cross-Appellant) Solicitors: Addison Lawyers (Appellants/Cross-Respondents) Michael Kreveld Legal (Respondent/Cross-Appellant)
File Number(s):	2015/26431
Decision under appeal	Court or tribunal: Supreme Court Jurisdiction: Common Law Division Citation: [2014] NSWSC 1616; [2014] NSWSC 1873 Date of Decision: 17 November 2014 (No 4); 31 December 2014 Before: Rothman J File Number(s): 2011/408095