Derek Brammall v Benedict Ian Stevens
[2023] ACTMC 24
•7 July 2023
MAGISTRATES COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Derek Brammall v Benedict Ian Stevens |
Citation: | [2023] ACTMC 24 |
Hearing Dates: | 31 May 2023 and 3 July 2023 |
DecisionDate: | 7 July 2023 |
Before: | Magistrate J Campbell |
Decision: | 1. Judgment will be entered in favour of the plaintiff against the defendant in the sum of $35,000. 2. The defendant to pay the plaintiff’s costs of the proceedings being $2,025. |
Catchwords: | CIVIL LAW – defamation – application for default judgment – publication and identification – whether publication is defamatory – serious harm to be found as element of cause of action – assessment of damages |
Legislation Cited: | Civil Law (Wrongs) Act 2002 (ACT), ss 118(2), 122A, 124A, 124B, 139E, 139J Court Procedures Rules 2006 (ACT), rr 1117, 1118, 1126(2), 1126(6), 6700(3) |
Cases Cited: | Stewart v Coughlan (1885) 11 VLR 279 Reid v Dukic [2016] ACTSC 344 |
Parties: | Derek Brammall (Plaintiff) Benedict Ian Stevens (Defendant) |
| Solicitors Richard John McGilvray (Plaintiff) | |
File Number: | CS 170 of 2022 |
MAGISTRATE J CAMPBELL
Introduction
The plaintiff, Derek Brammall commenced proceedings by Originating Claim filed 10 November 2022 and refiled on 18 November 2022 seeking damages in defamation against the defendant, Benedict Ian Stevens, arising from two emails the defendant sent to a number of people in September 2022.
On 25 January 2023, the Court ordered that service of the Originating Claim, statement of claim and other documents was taken to have been effected on the Defendant on 19 December 2022. Leave was granted to the defendant to file his Notice of Intention to Respond or defence out of time and within 28 days of the Order.
The plaintiff by Application dated 27 February 2023 seeks default judgment following the defendant’s failure to file a Notice of Intention to Respond or defence (Court Procedures Rules 2006 (ACT) r 1117). This failure allows the Court to find the defendant admits the facts upon which the claim is made (Stewart v Coughlan (1885) 11 VLR 279; Reid v Dukic [2016] ACTSC 344).
Rule 1126(6) of the Court Procedures Rules 2006 (‘the Rules’) provides that ‘[t]he court may enter judgment under this division (other than rule 1126) in favour of the plaintiff without a hearing.’ This rule applies to the present matter as the plaintiff is not entitled to apply for default judgment under r 1126.
The matter came before me for hearing on 29 March 2023. Prior to handing down my decision, I became aware the defendant had not been informed of the date of the hearing, although he had been advised of the listings for 8 March 2023 and 22 March 2023, which he did not attend. The matter was again listed for hearing on 31 May 2023 and the defendant did not attend. The same evidence was tendered at the hearing on 31 May 2023, and I rely on the written and oral submissions made by the Plaintiff’s solicitor at the hearing on 29 March 2023. Further evidence was tendered and amended submissions were made on 3 July 2023.
On 15 March 2023, the Court ordered the evidence in the proceedings to be given by affidavit pursuant to r 6700(3)(a) of the Rules. The evidence consisted of the following affidavits:
·Richard John McGilvray affirmed 17 January 2023;
·Richard John McGilvray affirmed 27 February 2023;
·Derek Brammall affirmed 10 March 2023;
·Derek Brammall affirmed 15 March 2023;
·William Adams affirmed 20 March 2023;
·Allison Scholar affirmed 28 June 2023; and
·Karl Michelin-Beard affirmed 28 June 2023.
I am satisfied that as of 10 March 2023 the matter had not been settled with the defendant nor had the defendant paid any monies towards the relief claimed in the Originating Claim.
The Application for default judgment seeks judgment be entered in favour of the plaintiff in the amount of $30,000, although the Originating Claim sought $35,000 and this figure was referred to in the submissions of the plaintiff’s solicitor.
Rule 1126(2) of the Rules provides that on application by the plaintiff under r 1118 (Default judgment— generally), the Court may enter the judgment it considers is justified on the plaintiff’s claim for relief even if the judgment was not claimed.
10.I am satisfied that a Concerns Notice containing all information required by s124A of the Civil Law (Wrongs) Act2002 (ACT) (‘the Act’) was sent by email to the defendant on 23 September 2022. I am satisfied the imputations were particularised in the Concerns Notice and the applicable time to make amends had elapsed before the commencement of the proceedings on 10 November 2023, in accordance with s124B of the Act.
Relevant Legal Principles
11.Section 118(2) of the Act provides the common law applies to the tort of defamation unless the Act provides otherwise.
12.I must be satisfied on the balance of probabilities that the defendant published matter to at least one other person, which identified and defamed the plaintiff (Radio 2UE Sydney Pty Ltd v Chesterton (2009) 238 CLR 460).
13.Section 122A of the Act now requires the judicial officer to find the publication has caused, or is likely to cause, serious harm to the reputation of the person as an element of the cause of action for defamation.
Publication and Identification
14.The plaintiff’s claim relies on two emails sent on 22 September 2022 from an email account identified as “[email protected]”. The first email sent at 12.23am also included an email account of “[email protected]” as a recipient of the email. Both emails were signed off by Ben Stevens, Stevens Investment Strategies, Director, and a logo presumably associated with that business. Both these email accounts have been provided to the Court Registry by the defendant for communications in these proceedings. Relying on this, as well as the content of the emails, I am satisfied that the defendant was the author of both emails.
15.The first email was sent to the following people’s email address:
·Viknesh Pillay;
·Karl Michelin-Beard;
·Aaron Hockey;
·Allison Scholar (nee Burman); and
·the defendant.
16.The second email sent at 4.49am was sent to the same people (excepting Allison Burman) and to Kirsten Smith’s email address and an email address of “[email protected]”.
17.By way of background, the plaintiff is a qualified mortgage broker and a Director of Reorient Pty Ltd and Reorient Two Pty Ltd. Up until 9 August 2022, the defendant was a director of both companies. Both companies carry on the business of mortgage brokering with Reorient Pty Ltd trading as Aussie Tuggeranong and Reorient Two Pty Ltd trading as Aussie Weston Creek. The companies operate the businesses as a franchisee under an agreement with Aussie Centre Administration Pty Ltd. The defendant was employed by Aussie Tuggeranong and Aussie Weston Creek up until 9 August 2022. Reorient Two Pty Ltd leased premises at Cooleman Court, Weston from a related entity to Mirvac Limited.
18.The recipients of the two emails are known to the plaintiff as follows:
·Viknesh Pillay is a solicitor employed by Rankin Business Lawyers and was engaged by both Reorient companies since March 2021.
·Karl Michelin-Beard is a director of both Reorient companies and a qualified mortgage broker working with the plaintiff.
·Aaron Hockey was the head of retail distribution for Aussie Home Loans and to whom the plaintiff directly reported.
·Allison Scholar is an accountant and was responsible for preparing various financial documents for both Reorient companies in her employment as Senior Manager of Veritas Wealth Solutions.
·Kirsten Smith was employed by Mirvac Limited as Retail Sales Executive and on behalf of the lessor, had direct dealings with the plaintiff regarding the lease of the premises in Cooleman Court, Weston.
19.I am satisfied the plaintiff was both directly and indirectly identified in each of the two emails sent by the defendant. The second email refers to the current directors of the two Reorient companies as well as referring to the plaintiff as a director who co-signed a Settlement Deed. The recipients of the email, including Ms Smith, would know that the plaintiff was a director of the companies and that the allegations contained in each email were directed to various people, including the named plaintiff.
20.The first email describes the plaintiff as engaging in fraud, theft, and improper conduct which has caused significant damage to the two companies.
21.The second email was sent a few hours after the first and included Ms Smith, presumably as it purported to pertain to the lease with Reorient Two for the premises at Cooleman Court. It refers to the current directors’ default on lease obligations for the lease of premises at Tuggeranong, which required the guarantor to make a default payment as part of a settlement deed. The defendant states that the plaintiff has made fraudulent claims regarding the settlement and payment of monies in relation to this lease default. The email states that it attached a number of documents, however these were not included in the documents tendered in the proceedings.
Whether the Publication is Defamatory
22.In Radio 2UE Sydney Pty Ltd v Chesterton (2009) 238 CLR 460, the majority (French CJ, Gummow, Kiefel and Bell JJ) held at [36]:
In principle therefore the general test for defamation should apply to an imputation concerning any aspect of a person’s reputation. A conclusion as to whether injury to reputation has occurred is the answer to the question posed by the general test, whether it be stated as whether a person’s standing in the community, or the estimation in which people hold that person, has been lowered or simply whether the imputation is likely to cause people to think the less of a plaintiff. An imputation which defames a person in their professional or business reputation does not have a different effect. It will cause people to think the less of that person in that aspect of their reputation.
23.Section 122A of the Act took effect on 30 June 2021 and has not yet been considered in this jurisdiction. NSW legislation also requires that serious harm be established (s 10A Defamation Act 2005 (NSW)). The NSW provision has been considered by the NSW Supreme Court in Newman v Whittington [2022] NSWSC 249 (‘Newman’). His Honour Justice Sackar drew on the leading English case of Lachaux v Independent Print Ltd and another [2020] AC 612 (‘Lachaux’), as the NSW provisions mirror s 1 of the Defamation Act 2013 (UK).
24.In Newman, the Court at [68-69] approved the decision in Lachaux which held the section introduced a new threshold element of serious harm and the plaintiff bears the onus to demonstrate as a fact that the harm caused by the publication was serious (at [13] – [15]).
25.In the Victorian case of Robert Lewis Wilks v Dori Qu [2022] VCC 620, Clayton J at [25] stated:
The inherent tendency of the words must be considered in conjunction with the actual impact on those to whom they had been communicated, including those who had never heard of the claimant at the time. In respect of “likely to cause harm” the phrase refers to ‘probable’ future harm rather than the inherent tendency to cause harm.
26.The NSW Court of Appeal in Rader v Haines [2022] NSWCA 198 (‘Rader v Haines’) approved the decision in Lachaux. The Court set out the following propositions that it held were established in the English case at [28]:
1.In order to succeed, a plaintiff must satisfy the threshold of showing that the publication has caused or is likely to cause serious harm to his or her reputation.
2.“Serious” harm involves harm that is more than merely substantial, though it need not be grave.
3.The requirement for serious harm to reputation is concerned with actual or likely reputational damage — that is, the impact of the imputation, in all the circumstances, on the plaintiff’s reputation — arising from a combination of the inherent tendency of the words and their actual impact on those to whom they were communicated. It is not satisfied by the gravity of the imputation alone. Nor is it satisfied by injury to feelings, however great. Relevant factors include the meaning of the words, the extent of the publication, the nature of the recipients and their relationship with the plaintiff, and whether they believe the imputations.
4.A grave imputation may not result in serious harm, typically where the publication is to a small number of persons well acquainted with the plaintiff who are not disposed to believe it, and any impact of the imputation on the plaintiff’s reputation is transitory or ephemeral.
27.The clear meaning of the defendant’s first email is to assert the following:
·The plaintiff at a time when he was not a director of the companies, misrepresented himself as such on many occasions. Although he was not a director, he had engaged in the management of the companies, he had directed funds to himself and other entities, he had paid himself and engaged in significant credit activities. All these actions were unapproved and unauthorised by the directors at the time (the defendant being one of those directors).
·The plaintiff has engaged in minority shareholder oppression which had been assisted by the recipients of the email, and this conduct has caused significant hardship on the defendant and his family.
·The plaintiff’s fraudulent and improper conduct has had significant impact on the companies’ resources.
28.The claimed imputations are as follows:
a)the plaintiff directed funds to himself and other entities;
b)the plaintiff paid himself;
c)the plaintiff has engaged in significant credit activities;
d)the plaintiff carried out actions that he was not approved or authorised to do;
e)the plaintiff’s actions constitute fraud, theft and unconscionable conduct;
f)the plaintiff has engaged in shareholder oppression;
g)the plaintiff has caused the defendant to live in a state of extreme fear, confusion and paranoia; and
h)the plaintiff has engaged in criminal actions.
29.Except for the imputation listed above at (g), I am satisfied that the first email is to be read as making the claimed imputations.
30.The second email is to confirm that Mirvac, being the lessors for the premises at Cooleman Court, is aware of the change of directors of Reorient Two and attaches a document that purportedly requires the removal of New South Wales Cashies Pty Ltd as the guarantor of the lease which has not occurred. This document was not included in the copy of the email tendered in the proceedings.
31.The defendant then continues to assert that:
·the current directors have defaulted on their lease obligations with Tuggeranong Town Centre;
·the plaintiff, despite co-signing a Settlement Deed, has fraudulently claimed being unaware of the Settlement Deed and agreement;
·the directors’ default required the Guarantor to make a Settlement Default payment;
·the defendant, as a director of Reorient Two entered into a loan agreement with the Guarantor however the current directors refuse to acknowledge this payment made by the defendant;
·the defendant is unable to pay the money owed to the Guarantor, and he therefore expects the Guarantor will commence legal action against Reorient Two;
·and the directors false and fraudulent claims have destroyed the defendant’s reputation and his ability to earn an income.
32.The defendant states in the email that his intention of providing this information to Mirvac is to put them on notice of the likely legal proceedings and to be aware of the “quality of the tenants you are now dealing with”.
33.The claimed imputations are as follows:
a)the plaintiff caused a default on Reorient’s lease obligations;
b)the plaintiff has made fraudulent claims;
c)the plaintiff has caused a default on a settlement deed and agreement;
d)the plaintiff has refused to acknowledge monies paid by the defendant;
e)the plaintiff is a poor quality tenant; and
f)the plaintiff has made false and fraudulent claims that have destroyed the defendant’s reputation and ability to earn an income.
34.I am satisfied that the second email by direct and indirect reference to the plaintiff contain the claimed imputations.
35.The plaintiff is a qualified mortgage broker with over 10 years of experience. This occupation involves the provision of financial advice and as such is a profession that relies on the reputation of honesty and trustworthiness, particularly in relation to financial matters. Allegations that the plaintiff has been engaged in fraudulent, unconscionable and criminal activity are extremely serious allegations.
36.I am satisfied that the two emails were likely to cause people to think the less of the plaintiff.
37.The recipients of the emails were selected because of their business relationship with the plaintiff:
·Ms Michelin-Beard is the plaintiff’s business partner and co-director of the companies;
·Mr Pillay is the solicitor of the companies;
·Mr Hockey is effectively the plaintiff’s supervisor under the franchise arrangements;
·Mr Scholar is the accountant for the companies; and
·Ms Smith was the representative of the lessor for the lease of the premises by Reorient Two.
38.The plaintiff deposed to the following harm or likely harm the emails have caused:
·concerns that Mirvac may not offer an extension of the lease at Cooleman Court;
·concerns that the franchisor may no longer trust the plaintiff, which may lead to the termination of the franchise agreements; and
·concerns that the plaintiff’s professional business relationship with Mr Michelin-Beard has been damaged, resulting in a loss of trust by Mr Michelin-Beard.
39.Following Rader v Haines, serious harm is not established merely by the gravity of the allegations or the plaintiff’s own concerns and feelings. The Court must look at the impact of the imputation, in all the circumstances, on the plaintiff’s reputation arising from a combination of the inherent tendency of the words and their actual impact on those to whom they were communicated.
40.There is no evidence that there has been any impact on the lease arrangements at Cooleman Court or the franchise agreement. There is, however, evidence of the impact on the professional relations that the plaintiff has with his business partner, Mr Michelin-Beard and the companies’ accountant, Ms Scholar.
41.Mr Michelin-Beard deposed that he believed the emails and took them seriously. He stated that the defendant as a director of the companies may have had a basis for his statements. In the initial few months of the emails, Mr Michelin-Beard believed the plaintiff had stolen money and committed fraud, which tested their business relationship. Mr Michelin-Beard considered options to exit the business at that time. He still does not completely trust the plaintiff, resulting in Mr Michelin-Beard questioning the plaintiff’s business decisions and double-checking all the books and records. He states that his opinion of the plaintiff as a businessman has declined and that he no longer holds him with the same level of regard he once did. He is concerned about the plaintiff’s moral compass and lack of empathy towards those with mental health issues, which arises from the defendant’s claim as to how the plaintiff acted towards him in the business.
42.Ms Scholar deposed that she met the defendant in 2022 and had a good professional relationship with him as the director of the two companies. She took the information contained in the defendant’s emails seriously given that he was a previous director of the company and had no reason to believe that the information was false. She stated she does not trust the plaintiff to the same extent that she did before receipt of the emails and her opinion of him as a businessman has declined. Of significance, she states that she is now less likely to refer work or clients to the plaintiff. In her accounting work she performs for the plaintiff personally and the two companies, she double-checks all information and documents provided by the plaintiff, which has resulted in an increase of time and fees.
43.I am satisfied that the plaintiff has established that the publication has caused serious harm to the reputation of the plaintiff. It is clear that at least Mr Michelin-Beard and Ms Scholar think less of the plaintiff and as a result, have changed their methods of dealing with the plaintiff.
44.There is no evidence before the Court that invokes any of the defences in the Act or at law.
Assessment of Damages
45.Section 139E of the Act provides:
In determining the amount of damages to be awarded in any defamation proceedings, the court is to ensure that there is an appropriate and rational relationship between the harm sustained by the plaintiff and the amount of damages awarded.
46.There are two causes of action complained in these proceedings, being the publication of two emails. Section 139J of the Act allows the Court to assess damages in a single sum. Damages for non-economic loss are limited to $250,000 (s 139F).
47.His Honour Justice Burns in Reid v Dukic [2016] ACTSC 344 stated at [47]:
An award for damages in defamation serves three purposes:
(a)consolation for personal distress and hurt;
(b)reparation for the harm done to the plaintiff’s personal (and where relevant, business) reputation; and
(c)vindication of the plaintiff’s reputation.
48.Justice Burns adopted the principles for assessing damages as summarised by the NSW Court of Appeal in Ali v Nationwide News Pty Ltd [2008] NSWCA 183 at [72] – [76], which stated:
[72] The harm caused to the plaintiff by the publication of the defamation often lies more in his own feelings, what he thinks other people are thinking of him, than in any actual change made manifest in their attitude towards him. Thus “[a] solatium for injured feelings, however innocent the publication by the defendant may have been, forms a large element in the [general compensatory] damages”: Cassell & Co Ltd v Broome [1972] AC 1027 at 1124 per Lord Diplock.
[73] A person who is defamed receives damages because he or she has been injured in his or her reputation; that is, because he or she was publicly defamed. Damages in a defamation action vindicate the plaintiff to the public, and are consolation for a wrong done: Uren v John Fairfax & Sons Pty Ltd [1966] HCA 40; (1966) 117 CLR 118 at 150 per Windeyer J.
[74] The damages awarded in a defamation action have to be regarded as demonstrating that the plaintiff has been vindicated in his or her reputation: Dingle v Associated Newspapers Ltd [1964] AC 371 at 396 per Lord Radcliffe; Carson at 69 per Brennan J. The level of damages should reflect the high value the law places upon reputation and, in particular, upon the reputation of those whose work and life depend upon their honesty, integrity and judgment: Crampton v Nugawela (1996) 41 NSWLR 176 at 195; applied in John Fairfax Publications Pty Ltd v O'Shane (No 2) [2005] NSWCA 291 at [3] per Giles JA, Ipp JA agreeing.
[75] The harm done by the defamatory publication for which general compensatory damages are recoverable, does not come to an end when the publication is made: Cassell at 1124 per Lord Diplock. “It is impossible to track the scandal, to know what quarters the poison may reach”: Ley v Hamilton (1935) 153 LT 384 at 386 per Lord Atkin. Accordingly, the damages awarded for defamation must be such that “in case the libel, driven underground, emerges from its lurking place at some future date, [the plaintiff] must be able to point to a sum awarded by a jury sufficient to convince a bystander of the baselessness of the charge”: Cassell at 1071 per Lord Hailsham of St Marylebone LC. Mahoney ACJ referred to this statement with approval in Crampton at 193, holding (at 194–195) that “[t]he award must be sufficient to ensure that, the defamation having spread along the ‘grapevine’ … and being apt to emerge ‘from its lurking place at some future date’, it was ‘sufficient to convince a bystander of the baselessness of the charge’ ”; see also Carson at 70.
[76] In assessing damages the tribunal of fact is entitled to take into consideration “the mode and extent of the publication, that the defamatory statement was never retracted, that no apology was ever offered to the respondent, and that the statement had been persisted in to the end”. Such circumstances might in the opinion of that tribunal “increase the area of publication and the effect of the libel on those who had read it or who would thereafter read it, might extend its vitality and capability of causing injury to the plaintiff”: Herald & Weekly Times Ltd v McGregor (1928) 41 CLR 254 at 263 per Knox CJ, Gavan and Starke JJ. The assessment of damages involves an understanding of the nature and seriousness of the imputations and the defendants’ conduct: see Coyne v Citizen Finance Ltd [1991] HCA 10; (1991) 172 CLR 211 at 241.
49.I am of the view that the imputations to the plaintiff’s reputation were serious, having regard to his occupation and to the selected recipients of the emails. I accept the plaintiff had genuine and valid concerns that the defendant’s claims would adversely affect his reputation and standing among the recipients of the email and that the plaintiff’s feelings were clearly hurt by the publication. The fact that the defendant had been a director of the two companies very likely gave the impression he was aware of the plaintiff’s conduct and wished to ensure the plaintiff’s business associates were also aware of the claimed fraudulent conduct by the plaintiff. For someone whose livelihood relies heavily on his reputation of trust and honesty, such claims clearly had the potential to cause serious harm to this reputation. There has been no retraction of the allegations to either the plaintiff or any of the recipients of the emails. The publication by way of email to selected recipients was designed to impugn the plaintiff’s business and professional reputation. I note that there has been no further or continuing imputations made by the defendant since the date of the emails.
50.The plaintiff submits an award of damages of $35,000 is appropriate. I agree this sum adequately reflects the purposes of damages in the circumstances of this case. It clearly demonstrates that the Court has found the assertions made by the defendant were defamatory and that the plaintiff’s reputation will be vindicated in the eyes of the recipients of the two emails.
Orders
Judgment will be entered in favour of the plaintiff against the defendant in the sum of $35,000.
The defendant to pay the plaintiff’s costs of the proceedings being $2,025.
I certify that the preceding fifty [50] numbered paragraphs are a true copy of the Reasons for Decision of Her Honour Magistrate J Campbell.
Associate: Adelaide Grisard
Date: 7 July 2023