FEDERAL COURT OF AUSTRALIA
Chau v The Australian Broadcasting Corporation [2019] FCA 1856
File number: NSD 1088 of 2017 Judge: RARES J Date of judgment: 10 October 2019 Catchwords: PRACTICE AND PROCEDURE – amendment of pleadings – application for leave to amend defence to include more extensive particulars of justification relating to imputations of bribery – where proposed particulars were highly unlikely to support the admission of evidence that could prove substantial truth of imputations of bribery and where objective facts and materials did not support imputations – where applicant lost earlier trial date due to pending determination of appeal of publishers’ prior unsuccessful application for leave to file amended defence – where seriousness of allegations required prompt and proper particularisation of justification defence to imputations of bribery – where real likelihood that applicant’s reputation adversely affected by delay and attempt to further amend defence – where human strain on applicant – application dismissed Legislation: Federal Court of Australia Act 1976 (Cth) Pt VB Cases cited: Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175
Australian Broadcasting Corporation v Wing (2019) 371 ALR 545
Mirror Newspapers Ltd v Harrison (1982) 149 CLR 293
Tamaya Resources Limited (in liq) v Deloitte Touche Tohmatsu (2016) 332 ALR 199
Date of hearing: 10 October 2019 Registry: New South Wales Division: General Division National Practice Area: Other Federal Jurisdiction Category: Catchwords Number of paragraphs: 36 Counsel for the Applicant: Mr B McClintock SC with Mr M Richardson Solicitor for the Applicant: Mark O’Brien Legal Counsel for the Respondents: Mr PW Gray SC with Mr MJ Lewis Solicitor for the First Respondent: Australian Broadcasting Corporation Solicitor for the Second and Third Respondents: MinterEllison ORDERS
NSD 1088 of 2017 BETWEEN: CHAU CHAK WING
Applicant
AND: THE AUSTRALIAN BROADCASTING CORPORATION
First Respondent
FAIRFAX MEDIA PUBLICATIONS PTY LIMITED ACN 003357720
Second Respondent
NICK MCKENZIE
Third Respondent
JUDGE:
RARES J
DATE OF ORDER:
10 OCTOBER 2019
THE COURT ORDERS THAT:
1.The respondents’ interlocutory application as amended on 9 October 2019 be dismissed.
2.The respondents pay the applicant’s costs of the interlocutory application, amended interlocutory application and further amended interlocutory application seeking leave to amend the defence.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
(REVISED FROM THE TRANSCRIPT)RARES J:
On 31 August 2018, I struck out the particulars of justification in the defence of The Australian Broadcasting Corporation, Fairfax Media Publications Pty Limited and their journalist, Nick McKenzie (the publishers). The publishers appealed to the Full Court, which granted leave to appeal, but dismissed the appeal on 2 August 2019: Australian Broadcasting Corporation v Wing (2019) 371 ALR 545. As a result of remarks I made during the course of argument of the strike out application on 27 June 2018, the publishers began to gather more information to supplement what they had alleged…
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- Case
- [2019] FCA 1856
- Decision Date
CaseChat Overview and Summary
The court considered the principles governing the exercise of discretion to allow amendments to pleadings, as established in Aon Risk Services Australia Ltd v Australian National University. The court emphasised that the explanation for the delay in bringing the amendment application must be given by the moving party and may depend on the particular circumstances of the case. The court also noted that the seriousness of the allegations required prompt and proper particularisation of the justification defence to the imputations of bribery. The court was concerned that the respondents had lost an earlier trial date due to the pending determination of their prior unsuccessful application for leave to file an amended defence. The court found that the proposed particulars were highly unlikely to support the admission of evidence that could prove the substantial truth of the imputations of bribery and that the objective facts and materials did not support the imputations.
The High Court dismissed the respondents' application for leave to amend their defence, finding that the explanation for the delay was deficient and that the proposed particulars were unlikely to support the admission of evidence that could prove the substantial truth of the imputations of bribery. The court also noted that the real likelihood was that the applicants' reputation had been adversely affected by the delay and the attempt to further amend the defence, and that there was a human strain on the applicants. The court ordered that the respondents pay the applicants' costs of the interlocutory application, amended interlocutory application, and further amended interlocutory application seeking leave to amend the defence.
Orders
Orders of the court
1. The respondents’ interlocutory application as amended on 9 October 2019 be dismissed.
2. The respondents pay the applicant’s costs of the interlocutory application, amended interlocutory application and further amended interlocutory application seeking leave to amend the defence.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
Ratio Decidendi
Legal Principle Established
The publishers argued that, in effect, the circumstances in which Dr Chau agreed to pay the USD200,000 to Mr Ashe were of such a suspicious nature that it was obviously, to his knowledge, a bribe to Mr Ashe in order, as par 38 of the particulars asserted, to induce him to attend the 2013 conference and to use the Resort for future United Nations events and conferences. They contended that this inference would support the plea of justification if the amendment were allowed. They also argued that the reason that one could infer that Dr Chau falsely told the FBI that he believed the USD200,000 payment was intended for the alleviation of poverty was that there was no reference in any of the material particularised to that intention, other than Dr Chau’s statement in the FBI interview. Consideration What the publishers now seek to do is to make a substantive change to their current defence. That defence raises no plea of justification because I had struck out the prior justification pleas on 31 August 2018, which decision the Full Court affirmed. In Tamaya Resources Limited (in liq) v Deloitte Touche Tohmatsu (2016) 332 ALR 199 at 224-227 [145]-[160], Gilmour, Perram and Beach JJ discussed a late amendment application by a party, which had not given an adequate explanation to support the exercise of the Court’s discretion to allow that amendment. Their Honours discussed the principles that, since Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175, now govern the way in which courts approach the exercise of discretions in case management. They said (332 ALR at 225 [149]): as French CJ observed in Aon at [25] , the House of Lords decision in Ketteman v Hansel Properties Ltd [1987] AC 189…(Ketteman) manifests a marked departure from the approach of Bowen LJ in Cropper [v Smith (1884) 26 Ch D 700] that a costs order is a cure all. Lord Griffiths in Ketteman said…[[1987] AC at] 220…that:‘… justice cannot always be measured in terms of money and in my view a judge is entitled to weigh in the balance the strain the litigation imposes on litigants, particularly if they are personal litigants rather than business corporations, the anxieties occasioned by facing new issues, the raising of false hopes, and the legitimate expectation that the trial will determine the issues one way or the other…Another factor that a judge must weigh in the balance is the pressure on the courts caused by the great increase in litigation and the consequent necessity that, in the interests of the whole community, legal business should be conducted efficiently.’(emphasis added) Their Honours then considered the issues of the nature and extent of any explanation that might be necessary and the relevance of a party’s negligence in failing to pursue either the subject matter that it sought to raise in the amendment, saying (332 ALR at 226-227 [154]-[160]): [154] Just what explanation is called for will necessarily depend upon the particular case. The explanation will be given by, or on behalf of, the moving party. Affidavit evidence may or may not be necessary. In Cement Australia [Pty Ltd v Australian Competition and Consumer Commission (2010) 187 FCR 261] for example, as the explanation was that the error was one of judgment by senior counsel for the ACCC, a statement by him from the bar table, to which no objection was taken, was accepted by the Court as sufficient.[155] It must be borne in mind that the explanation required is that of the moving party, not merely their solicitor or counsel. The client may very well know of matters relevant to the explanation for delay which are not known by the lawyers.[156] Evidence as to the explanation for delay will often be given by an applicant’s solicitor from their own knowledge but that may, in some cases, not be sufficient. This is such a case. The primary judge was correct to conclude that the explanation offered by Tamaya was deficient because Ms Banton could not explain why she did not know of the Chilean audit issues until she was told by Mr Basford. Her Honour’s approach does not involve any error of principle.[157] We observe, in this respect, that in Aon the plurality had regard to letters which were in the possession of the ANU one year or so before proceedings commenced and which bore on the issues the subject of the amendment application as relevant to the consideration of the adequacy of the explanation for the delay: Aon at [54] and [106] .[158] In any event, Tamaya, as we have observed, concedes that the Chilean audit issues could have been identified before these proceedings were commenced. As we have said, why they were not may have many explanations. None of those explanations are before us.[159] Even assuming negligence, such conduct of litigation does not attract indulgence from the Court as it might previously have in different times: GSA Industries [Pty Ltd v NT Gas Ltd (1990) 24 NSWLR 710] at 716, cited by French CJ in Aon at [25].[160] Further, as Heydon J observed in Aon at [131], the explanation for the delay in bringing the amendment application in that case, supported by an affidavit from the ANU’s solicitor, did not go so far as to exclude the possibility that the relevant facts could have been known earlier. His Honour said:‘There was nothing to indicate that whatever was seen as relevant had not been available earlier if diligence had been employed.’(emphasis added)