Ding v Rdest

[2018] NSWDC 411

District Court

New South Wales

Medium Neutral Citation:	Ding v Rdest [2018] NSWDC 411
Hearing dates:	8 November 2018
Date of orders:	13 December 2018
Decision date:	13 December 2018
Jurisdiction:	Civil
Before:	Gibson DCJ
Decision:	(1) Imputations 4(a) to 4(d) and 6(a) to 6(d) are struck out as not reasonably capable of being conveyed by each of the first and second matters complained of respectively. (2) Costs reserved with liberty to apply. (3) The parties are to bring in short minutes of order in relation to the future conduct of these proceedings.
Catchwords:	TORT - defamation - imputations - form and capacity
Legislation Cited:	Uniform Civil Procedure Rules 2005 (NSW), rr 14.28 and 28.2
Cases Cited:	Amalgamated Television Services Pty Ltd v Marsden (No 2) (2003) 57 NSWLR 338 Bik v Mirror Newspapers Ltd [1979] 2 NSWLR 679 n Chase v News Group Newspapers Ltd [2002] EWCA 1772; [2003] EMLR 11 Corby v Allen & Unwin Pty Ltd [2014] NSWCA 227 Drummoyne Municipal Council v Australian Broadcasting Corporation (1990) 21 NSWLR 135 Greig v WIN Television NSW Pty Ltd [2007] NSWSC 1118 Hockey v Fairfax Media Publications Pty Limited [2015] FCA 652 Kostov v Nationwide News Pty Ltd [2018] NSWSC 858 Lesses v Maras (2017) 128 SASR 292 Liquor Marketing Group & Anor v Sadler [2000] NSWCA 161 Medford v Nationwide News Pty Ltd [2007] WASC 52 Mirror Newspapers Ltd v Harrison (1982) 149 CLR 293 Murphy v Nationwide News Pty Ltd (No 2) [2017] FCA 781 Purcell v Cruising Yacht Club of Australia Pty Ltd [2003] NSWSC 245 Rayney v State of Western Australia (No 9) [2017] WASC 367 Rivkin v John Fairfax Publications Ltd (Supreme Court of New South Wales, Levine J, 17 July 1998) Sands v State of South Australia (2015) 122 SASR 195 Sergi v Australian Broadcasting Commission [1983] 2 NSWLR 669 Sharp v Harbour Radio Pty Ltd [2015] NSWSC 1536 Trkulja v Google LLC [2018] HCA 25 Wagner v Harbour Radio Pty Ltd [2018] QSC 201
Texts Cited:	George, P., Defamation Law in Australia (LexisNexis Butterworths, 2nd ed, 2012)
Category:	Procedural and other rulings
Parties:	Plaintiff: James Ding Defendant: Slawomir Rdest
Representation:	Counsel: Plaintiff: Mr R Weaver Defendant: Mr J Manner   Solicitors: Plaintiff: Panetta Lawyers Defendant: In person
File Number(s):	2018/223647
Publication restriction:	None

Judgment

The applications before the court

1. The plaintiff by statement of claim filed on 20 July 2018 (as amended on 29 August 2018) commenced proceedings for defamation for two emails published on 22 September 2017 and 13 February 2018.

2. The defendant brought a series of applications, first for summary dismissal, and then for a separate trial in relation to the form and capacity of the imputations pleaded. The application for a separate trial under Uniform Civil Procedure Rules r 28.2 (“UCPR”) is now the sole application before the court for determination.

3. The hearing of this application has been complicated by the filing of a great deal of irrelevant material on the part of the defendant, while at the same time failing to take the usual challenges to the form and capacity of the imputations until after this omission was noted by Mr Weaver in his submissions.

4. There have been problems in addition in relation to the conduct of the separate trial. The defendant’s submissions on form and capacity conflated the two matters complained of into one, although they are five months apart in time, and the four imputations pleaded to arise from each of the matters complained of were dealt with in a group rather than individually. It has been difficult to separate the arguments and, as Mr Weaver responded to the defendant’s submissions in the same way, I have largely done so as well, although at all times noting the relevant principles in relation to the need for separate determination of form and capacity issues for each imputation.

The factual background

5. The matters complained of are not only brief but difficult to understand without the benefit of the context of the background material.

6. The defendant is a resident in Strata Plan 71384 and the secretary of the Executive Committee which represented strata title holders. The plaintiff is a director of Expandnet International Investment Pty Ltd t/as Fiori Apartments ACN 145 264 704, a company which has provided caretaking services to the Strata Plan in accordance with a contract which will expire in 2023.

7. On 19 September 2017, the Strata Manager forwarded to the Executive Committee documents, which included a bank letter dated 12 September 2017 provided to him by the plaintiff, to enable the Owners Corporation to consider the reappointment of Expandnet as the caretaker of the Strata Plan. The proposed reappointment would be from 2017 to 2027 with the current Contract still in effect until 2023. In the course of the meeting, the plaintiff appears to have said words to the effect that the reason that reappointment was being sought for an additional 10 years was due to the bank’s request and was urgent as a result of the approaching end of financial year at that time.

8. It was in these circumstances that the matters complained of appear to have been sent. The first matter complained of attached the previously circulated bank letter (which I note is not included in the first matter complained of) and made comments about it.

9. The second matter complained of, sent five months later, consists of a forwarding of a Concerns Notice dated 13 February 2018 to the Executive. This Concerns Notice repeated four lines of the matter complained of and these 4 lines are relied upon as a fresh publication by the defendant (rather than a republication).

The first and second matters complained of

10. The text of the first matter complained of is as follows:

1.	Hi EC members, Sachin,
2.	Not wishing to question the majority vote, I would like to note the following:
3.	The the [sic] bank letter (see attached) does not address the need for urgency mentioned
4.	during the AGM.
5.	During the meeting, an extensive discussion took place in this regards
6.	and this subject is likely to return.
7.	From my recollection, the end of financial year was mentioned as a deadline.
8.	This is not reflected in the letter.
9.	The letter does not include any contact information to the bank,
10.	nor to the person issuing the letter.
11.	This state is unusual for formal bank communication.
12.	The date printed in the bottom left corner of the letter states 01/05/09.
13.	Consideration to the above is advisable prior to the meeting.
14.	Regards,
15.	Slawomir Rdest

11. The text of the second matter complained of which was published on 13 February 2018 is the same as paragraphs 9, 10, 11 and 12 above and is as follows:

16.	The letter does not include any contact information to the bank,
17.	nor to the person issuing the letter.
18.	This state is unusual for formal bank communication.
19.	The date printed in the bottom left corner of the letter states 01/05/09.

12. The imputations pleaded to arise from each of the matters complained of are the same. They are set out at paragraphs 4 and 6 of the Amended Statement of Claim respectively, and as follows:

1. The plaintiff forged a bank document in an attempt to mislead the Executive Committee of Fiori Apartments and influence its decision in respect of the plaintiff’s application to extend Expandnet’s management contract;

2. The plaintiff may be reasonably suspected of forging a bank document in an attempt to mislead the Executive Committee of Fiori Apartments and influence its decision making in respect of the plaintiff’s application to extend Expandnet’s management contract;

3. The plaintiff deliberately misled the Executive Committee of Fiori Apartments in an attempt to influence its decision in respect of the plaintiff’s application to extend Expandnet’s management contract;

4. The plaintiff may be reasonably suspected of deliberately misleading the Executive Committee of Fiori Apartments in an attempt to influence its decision in respect the plaintiff’s application to extend Expandnet’s management contract.

13. Despite the clear need for context and identification of the plaintiff in both matters complained of, the imputations are pleaded to arise in the natural and ordinary meaning. There are no extrinsic facts pleaded; the plaintiff relies upon the letter from Suncorp, which was attached and discussed in the first matter complained of, as being relevant to identification only, and accordingly it does not form part of the matter complained of.

14. The problems with the second matter complained of are even more stark. If these words were an extract from a Concerns notice, they could not have been read in isolation from that notice. Neither party, however, referred to the contents of the Concerns notice in their submissions.

15. There are real difficulties in determining exactly what the matters complained of convey, in the absence of information about what was discussed at the meeting. Questions of what defamatory meaning (if any) in a case such as the present are best determined by a separate trial as to the capacity of the imputations conveyed. However, that is a considerable difficulty in a case such as the present, where what was said by the defendant and third parties at the meeting is unknown.

16. Ultimately, however, the onus lies on the plaintiff to plead his or her case. Failure to do so in a clear and coherent way should be a threshold issue. Although the hearing of arguments as to the capacity of imputation has been criticised as being unnecessary (Murphy v Nationwide News Pty Ltd (No 2) [2017] FCA 781), the circumstances of this case are a good example of how an imputations argument, if correctly applied to the facts, can in fact play a significant role in determining whether or not a publication can be sued on at all.

17. I first note that, in the course of argument, counsel for the plaintiff has acknowledged that the imputations of guilt and suspicion cannot arise at the same time and that the imputations of suspicion would accordingly need to be pleaded as fall-backs.

18. I next note that the defendant has had difficulty with obtaining legal representation and, in order to assist him, I set out in more detail than usual the relevant principles to apply in relation to a separate trial on the capacity of imputations under r 28.2 UCPR, as well as the manner in which objections as to form pursuant to r 14.28 UCPR should be determined.

Rulings as to capacity

19. Rulings as to the capacity of the imputations pleaded to arise are generally determined on the “generosity not parsimony” test set out by the New South Wales Court of Appeal in Corby v Allen & Unwin Pty Ltd [2014] NSWCA 227 at [133]-[138] as follows:

“133 The judge’s function at the capacity stage is to determine “the outside boundaries of the possible range of meanings and [set] the ‘ground rules’ for the trial”: P Milmo and WVH Rogers, Gatley on Libel and Slander (11th ed 2008, Sweet & Maxwell) (“Gatley”), at [3.13] (see also [32.5]) citing Mapp v News Group Newspapers Ltd [1998] QB 520.

134 That standard by which the issue of law raised by the separate trial was to be determined was addressed in Favell v Queensland Newspapers Pty Ltd [2005] HCA 52; (2005) 79 ALJR 1716 (“Favell”) where the plurality (Gleeson CJ, McHugh, Gummow and Heydon JJ, Kirby J generally agreeing) approved the following statement by McPherson JA in the Court of Appeal: “Whether or not [the pleading] ought to and will be struck out [as disclosing no cause of action] is ultimately a matter for the discretion of the judge who hears the application. Such a step is not to be undertaken lightly but only, it has been said, with great caution. In the end, however, it depends on the degree of assurance with which the requisite conclusion is or can be arrived at. The fact that reasonable minds may possibly differ about whether or not the material is capable of a defamatory meaning is a strong, perhaps an insuperable, reason for not exercising the discretion to strike out. But once the conclusion is firmly reached, there is no justification for delaying or avoiding that step [at] whatever stage it falls to be taken.” (Emphasis added)

135 Accordingly, the capacity determination is “an exercise in generosity not parsimony”; while it involves a “matter of impression ... the impression is not of what the words mean but of what a jury could sensibly think they meant”: Berezovsky (at [16]) per Sedley LJ delivering the judgment of the court. Implicit in Sedley LJ’s observation, is that the question of course is “what a jury could sensibly think [the words] meant” to the ordinary reasonable reader.

136 One reason “great caution” is mandated at the capacity stage, is because the conclusion which necessarily underpins a determination that the matter complained of is not capable of conveying the pleaded imputations is that “no reader could reasonably understand the words to bear any meaning outside the range delimited ... by the judge; and that it would be ‘perverse’ for any jury to do so’”: Jameel v Wall Street Journal Europe SPRL [2003] EWCA Civ 1694; [2004] EMLR 89 (“Jameel”) (at [9]) per Simon Brown LJ (Mummery and Mance LJJ agreeing).

137 Thus, the focus should be on the fact that the decision deprives the plaintiff of the opportunity to present his or her case to the jury, the importance of whose constitutional role in this area as representatives of the community is frequently emphasised: see John Fairfax Publications Pty Ltd v Rivkin [2003] HCA 50; (2003) 77 ALJR 1657 (“Rivkin”) (at [2]) per Gleeson CJ (who also agreed with Callinan J); (at [184]) per Callinan J. The significance of the jury’s role warrants the application of a “high threshold of exclusion”: Jameel (at [14]) per Simon Brown LJ.

138 In Favell (at [14] - [15]), the plurality appeared to apply a capacity test which asked whether challenged imputations “could reasonably be found by a jury”. This is the test adopted in this Court: see Marsden (at 164) per Hunt CJ at CL (Mason P and Handley JA agreeing); Griffith v John Fairfax Publications Pty Ltd [2004] NSWCA 300 (at [19](a)); Malcolm v Nationwide News Pty Ltd [2007] NSWCA 254; (2007) Aust Torts Reports ¶81-915 (at [14]) per Beazley JA (Basten JA and McClellan CJ at CL agreeing). It is consistent with the test applied when determining generally whether a case should be left to a jury: see Naxakis v Western General Hospital [1999] HCA 22; (1999) 197 CLR 269 (at [16]) per Gaudron J; (at [45]) per McHugh J; (at [66] - [67]) per Kirby J; cf Gleeson CJ (at [1]); Callinan J (at [117] - [123]). Naxakis concerned the test to be applied when directing a jury at the close of evidence to enter a verdict in favour of the defendant. Whether or not the Naxakis approach is strictly that which should be applied at a capacity determination was not argued. In any event the Court is bound to follow Marsden.”

20. The role of context may be important. For example, where a radio or television broadcast is involved, or a sensational publication, the “degree of analytical care” (Wagner v Harbour Radio Pty Ltd [2018] QSC 201 at [34]) is less than would be the case where the ordinary reasonable reader was construing, for example, a legal document or a serious piece of investigative journalism. Flanagan J sets out these principles in Wagner v Harbour Radio Pty Ltd at [34] as follows:

“[34] The relevant principles, including the attributes and characteristics of the ordinary reasonable listener, were identified by Hunt CJ at CL in Amalgamated Television Services Pty Ltd v Marsden as follows:

(a) the ordinary reasonable reader is a person of fair average intelligence, who is neither perverse, nor morbid or suspicious of mind, nor avid for a scandal;

(b) that person does not live in an ivory tower but can and does read between the lines in the light of that person’s general knowledge and experience of worldly affairs;

(c) the mode or manner of publication is a material matter in determining whether the imputation is conveyed;

(d) the more sensational a publication, the less likely it is that the ordinary reasonable person will read it with the degree of analytical care which may otherwise have been given to a less sensational publication;

(e) the ordinary reasonable person considering such a publication is understandably prone to engage in a certain amount of loose thinking;

(f) a wide degree of latitude is given to the capacity of the matter complained of to convey particular imputations where the words published are imprecise, ambiguous, loose, fanciful or unusual;

(g) these considerations, and more, apply to matter published in a transient form, particularly in the electronic media; the reader of a written document has the opportunity to consider or to re-read the whole document at leisure and to check back on something, and in doing so change the first impression, but the listener or viewer has no such opportunity; and

(h) the ordinary listener must be assumed to have heard and seen the whole of the program, but he or she may not have devoted the same degree of concentration to each part of the program as would have been given to a written article — “particularly, I would say, where it is the radio” — and may have missed the significance of the existence, early in a program, of a qualification of a statement made later in the same material.” (Footnotes omitted)

21. The principles explained by Flanagan J are the basis for many rulings upon capacity in relation to publications. Their applicability to publications such as the present is, however, to be construed more generously than was the case in the proceedings before Flanagan J. This is because the test for capacity at trial is different to the test for capacity as a threshold issue. Nevertheless, the decision relied upon by Flanagan J to draw up this list (Amalgamated Television Services Pty Ltd v Marsden (No 2) (2003) 57 NSWLR 338) is the landmark decision on issues in separate trials such as the present.

22. Finally, I note that the High Court of Australia in Trkulja v Google LLC [2018] HCA 25 at [30]-[32] has recently urged even greater caution in relation to the striking out of imputations prior to the trial:

“30 The question of whether words or images complained of are capable of conveying a pleaded defamatory imputation is a question of law which permits of only one correct answer. It is, however, a question about which reasonable minds may sometimes differ, and, consequently, it is only ever with great caution that a defamation pleading should be disallowed as incapable of bearing a defamatory imputation. The potential for difference about the capacity of matters to convey different meanings is an equally strong reason for declining to set aside a proceeding on the basis that an impugned publication is incapable of bearing the defamatory imputation alleged. And it is to be remembered that on an application for summary dismissal such as this, the plaintiff's case as to the capacity of the publications to defame is to be taken at its highest.

31 The test for whether a published matter is capable of being defamatory is what ordinary reasonable people would understand by the matter complained of. In making that assessment, it is necessary to bear in mind that ordinary men and women have different temperaments and outlooks, degrees of education and life experience. As Lord Reid observed in Lewis v Daily Telegraph Ltd, “[s]ome are unusually suspicious and some are unusually naive”. So also are some unusually well educated and sophisticated while others are deprived of the benefits of those advantages. The exercise is, therefore, one of attempting to envisage a mean or midpoint of temperaments and abilities and on that basis to decide the most damaging meaning that ordinary reasonable people at the midpoint could put on the impugned words or images considering the publication as a whole.

32 As the Court of Appeal of England and Wales observed in Berezovsky v Forbes Inc, that exercise is one in generosity not parsimony. The question is not what the allegedly defamatory words or images in fact say or depict but what a jury could reasonably think they convey to the ordinary reasonable person; and it is often a matter of first impression. The ordinary reasonable person is not a lawyer who examines the impugned publication over-zealously but someone who views the publication casually and is prone to a degree of loose thinking. He or she may be taken to “read between the lines in the light of his general knowledge and experience of worldly affairs”, but such a person also draws implications much more freely than a lawyer, especially derogatory implications, and takes into account emphasis given by conspicuous headlines or captions. Hence, as Kirby J observed in Chakravarti v Advertiser Newspapers Ltd, “[w]here words have been used which are imprecise, ambiguous or loose, a very wide latitude will be ascribed to the ordinary person to draw imputations adverse to the subject”.” (Footnotes omitted)

23. The exercise in the present case is thus one of envisaging a mean or midpoint of temperaments and abilities in order to decide the most damaging meaning that ordinary reasonable persons at the midpoint could put upon the impugned words as a whole.

24. Finally, each of the matters complained of must be the subject of separate consideration, as must each of the imputations pleaded, unlike the “rolled up” approach taken by counsel for the defendant who not only run the imputations together but publications together in terms of his arguments to the court.

25. Defendants should not employ “excessive zeal” (Medford v Nationwide News Pty Ltd [2007] WASC 52 at [25]) in challenging imputations. However, where there is a clear difficulty of meaning arising, the desirability of dealing with the imputations at the commencement of the proceedings by way of a ruling under r 28.2 UCPR is preferable to the issue going to trial only for the case to flounder at the imputation level (see for example, Hockey v Fairfax Media Publications Pty Limited [2015] FCA 652 and its subsequent discussion in the media, such as the article by Graham Hryce, “Tiger whiplash hits Joe Hockey in back pocket”, Sydney Morning Herald, 23 July 2015, It is as much in the plaintiff’s interests as in the defendant’s that problems in pleading are recognised early rather than at trial, when it is too late.

26. Challenges to the form of imputations do not form part of the separate trial on meaning, and are determined in accordance with UCPR r 14.28. These rulings have long been dealt with in the same fashion as first explained by Gleeson CJ in Drummoyne Municipal Council v Australian Broadcasting Corporation (1990) 21 NSWLR 135 at 137A:

“The requirement that a plaintiff must “specify” the act or condition which he claims was attributed to him, that is to say, the statement which he says was made about him, which follows from the scheme of the Defamation Act, the provisions of the Rules of Court, and the ordinary rules of pleading, is one which, in its practical application, raises questions of degree. Almost any attribution of an act or condition to a person is capable of both further refinement and further generalisation. In any given case a judgment needs to be made as to the degree of particularity or generality which is appropriate to the occasion, and as to what constitutes the necessary specificity. If a problem arises, the solution will usually be found in considerations of practical justice rather than philology. In John Fairfax and Sons Ltd v Foord (1988) 12 NSWLR 706 this Court approved of Hunt J's leaving to the jury an imputation that the plaintiff was a criminal associate of drug dealers. No one suggested that it was necessary to identify with particularity the crime or crimes alleged to have been committed by the plaintiff, even though it is always theoretically possible to be more specific about an allegation that a person is a criminal.”

27. A common problem in terms of meaning arises where an allegation of criminal conduct is asserted. Is the matter complained of reasonably capable of conveying an imputation that the plaintiff is guilty of the conduct, or merely suspected of it? If the plaintiff is merely suspected, who suspects him?

Imputations of guilt and reasonable suspicion

28. Two problems commonly occur in relation to the pleading of imputation that a person has committed, or should be reasonably suspected of having committed, a criminal offence. The first of these is whether the imputation is one of guilt (Mirror Newspapers Ltd v Harrison (1982) 149 CLR 293 at 301) or mere suspicion and the second is that, where an imputation of reasonable suspicion of this kind is pleaded, the entity holding that suspicion needs to be identified: Sergi v Australian Broadcasting Commission [1983] 2 NSWLR 669 at 671B; see Purcell v Cruising Yacht Club of Australia Pty Ltd [2003] NSWSC 245.

29. The first question is who holds the suspicion. In Rivkin v John Fairfax Publications Ltd (Supreme Court of New South Wales, Levine J, 17 July 1998), Levine J noted that suspicion does not necessarily have to be conveyed by an “authority”:

“I must say that I was troubled by the submission of Mr Nicholas on the “authority” issue. To the extent, of course, that there is reference to the “authority” he is undoubtedly correct. But why, one might ask, does the holder of the suspicion have to be a person in authority before the imputation can be held to be capable of being defamatory? If a person is suspected of some misconduct by his/her “peers” or one of them, might that not be sufficient? I agree with the submission of Mr Hughes to require the presence, as-it-were, of the “authority”, as the holder of the suspicion is too restrictive. Each case might depend upon its own circumstances but I am of the view that if the publication refers to the conduct attributed to the plaintiff and the suspicion about it held by someone else and that there is something about the relationship between that person vis-a-vis the plaintiff, that gives some cogency or weight to the suspicion held by that person that might well be sufficient on a capacity argument.

What I have just enunciated could apply to the father of the deceased vis-a-vis the plaintiff the employer of the deceased's boyfriend (in the context of criminal connection with her death). To the deceased herself vis-a-vis the plaintiff in relation to his (sexual) conduct with her boyfriend. If an imputation is pleaded to tile effect that either “suspected” something in relation to the plaintiff, it is capable of being defamatory. That is one level of suspicion as argued by Mr Hughes. If the imputation is to the effect “reasonably suspected that...” is another level, a higher one and one substantially different. I am not however persuaded that such a distinction reasonably can be drawn when the holder of the suspicion is such an authority as the ASC and the suspicion relates to the plaintiff's corporate/ commercial/business conduct. In that context, I can see no difference in substance between “suspected” and “reasonably suspected”. With respect to these imputations if actually pleaded, they would be struck out, as would those stating that the suspicion was held by the police.”

30. The problem with reasonable suspicion is not that it involves use of the passive voice, but rather that the defamatory meaning which arises is unclear unless the holder of the suspicion is identified (see also Greig v WIN Television NSW Pty Ltd [2007] NSWSC 1118).

31. These imputations of guilt or alternatively suspicion are increasingly referred to as “Chase 1” (guilt) and “Chase 2” (suspicion) imputations: Chase v News Group Newspapers Ltd [2002] EWCA 1772; [2003] EMLR 11. However, these are essentially different names for the same process as that described in Mirror Newspapers Ltd v Harrison. The “Chase” method of analysis is explained in Rayney v State of Western Australia (No 9) [2017] WASC 367 at [60]-[64] and in Sands v State of South Australia (2015) 122 SASR 195 at [238].

The first matter complained of

32. Applying the approach taken by the New South Wales Court of Appeal in Corby v Allen & Unwin Pty Ltd, I first note the general principles that a man who uses the word “smoke” (so as to exclude the suggestion that there is also a fire) may need to pick his words very carefully. This is an apt analogy for the application before me, as the defendant appears to have chosen his words carefully.

33. Mr Weaver has set out in his written submissions that the imputation of guilt of forgery, or alternatively suspicion of misleading the committee, is asserted to arise from the absence of bank contact information and the date at the bottom of the letter. From this I infer that the misleading in question arises from the placing of falsified information before the committee. Mr Weaver’s submission is that these “flaws” (to use his words) in the bank letter would awake in the ordinary reasonable reader a heightened sense of caution, raising not merely a suspicion but a likelihood that the bank letter is not bona fide with what he calls “the clear imputation that it was forged by the plaintiff” (written submissions, paragraph 12). Alternatively, “in the very least” (written submissions, paragraph 13) it gives rise to an imputation of suspicion.

34. It is a very big leap from referring to the dot-pointed issues for “consideration” to saying that the enclosed letter (which is not part of the matter complained of) would have been forged, as opposed to containing out of date information; for example, the first issue of concern is that nothing in the bank letter suggests urgency, and the other matters relate more to inadequate or potentially outdated information. The invitation to the recipient of the first matter complained of is to look at whether the documentation is adequate. In particular, the issue raised in the first bullet point concerning the urgency of the plaintiff’s applications, suggest that the principal problem is that the applications were considered to be urgent, and that this was the subject of the “extensive discussion”.

35. For the ordinary reasonable reader to assume that the letters in question have been forged would amount to the drawing of an inference upon an inference. While reliance upon these principles has largely been eschewed, I note that in Sharp v Harbour Radio Pty Ltd [2015] NSWSC 1536 at [9] McCallum J said:

“[9] As submitted by Mr Richardson on behalf of the defendants, in the language of the earlier jurisprudence in this field of “inference upon inference”, one would have first to think that there had been some misappropriation (as to which there is no suggestion at all in the matter complained of); secondly, to think that that was the reason the forensic accountants were being sent in rather than other matters expressly pointed to in the matter complained of; and thirdly, to think that the plaintiffs were the people (or among the people) responsible for any such misappropriation. In my view, each of those steps stretches the meaning of the matter complained of too far from what the words reasonably bear. My ruling is that imputations 10.1 and 10.3 are incapable of arising.”

36. The matter complained of both by its form, structure, choice of words and careful reference to issues for other members of the executive committee to give “consideration” is incapable of giving rise to imputations of guilt. Such imputations are “strained or forced or utterly unreasonable” (Lesses v Maras (2017) 128 SASR 292 quoting Patrick George, Defamation Law in Australia (LexisNexis Butterworths, 2nd ed, 2012) 163-164).

37. The second “guilt” imputation is that the plaintiff deliberately misled the executive committee in an attempt to influence its decision.

38. Taking into account the principles of law set out above, I am satisfied that any imputation that the plaintiff “deliberately” sought to mislead the executive committee members is similarly strained, forced and/or utterly unreasonable. Again, the form, content and language is that of questioning, not accusation and amounts to a list of factors to be looked at prior to the meeting in view of omissions and/or inconsistencies in the documentation. No concluded view is put either way.

39. For the above reasons, each of imputations 4(a) and 4(c) in the first matter complained of is not reasonably capable of being conveyed and must be struck out.

The imputations of reasonable suspicion

40. Imputations 4(b) and 4(d) in relation to the first matter complained of each give rise to an imputation of suspicion, with a far lower bar than the commission of a criminal act. I shall deal with each in turn.

Imputation 4(b)

41. The suggestion that the plaintiff should reasonably be suspected (presumably by the members of the executive committee) of forging a letter because it fails to contain essential information or contains what looks like a wrong date requires the drawing of an inference on an inference in a similar fashion to the imputation.

42. This imputation is not reasonably capable of being conveyed and will be struck out.

Imputation 4(d)

43. The problems caused by the use of the word “deliberately” in this context are the same as those identified in Liquor Marketing Group & Anor v Sadler [2000] NSWCA 161 at [39] – [41]. Even at the low capacity threshold, the matter complained of as a whole cannot be read as conveying the message that the plaintiff deliberately disseminated misleading information.

44. An imputation that the plaintiff may be reasonably suspected of “deliberately” misleading the executive committee “in an attempt to influence its decision” is an imputation which is pitched too high for a list of matters to be noted for consideration about the adequacy of the bank document.

45. For example, the matter complained of does not assert that the plaintiff said the matter was urgent when it was not; it states that the bank letter did not address the need for urgency and that “this subject is likely to return”.

46. Although the imputation as pleaded is borderline, I am satisfied, having regard to the relevant factors as set out in Corby v Allen & Unwin Pty Ltd and Trkulja v Google LLC, that this is a list of matters to be considered as opposed to the raising of suspicions that the plaintiff had deliberately misled the executive.

47. Accordingly, this imputation is not reasonably capable of being conveyed.

The second matter complained of

48. The second matter complained of consists of an extract from a concerns notice which the defendant received from the solicitors for the plaintiff and forwarded to the executive committee.

49. Leaving aside the very real difficulties that defences to this claim may cause at the trial, the determination of the meanings in relation to the four lines pleaded is made even more difficult by the almost epigrammatic nature of their contents.

Imputations 6(a) and 6(c)

50. As to the imputations of guilt in relation to forgery and misleading the members of the executive committee, I repeat my observations as to the relevant principles of law as applied to these portions of the first matter complained of.

51. Neither of these imputations is reasonably capable of being conveyed.

Imputations 6(b) and 6(d)

52. For the same reasons as set out in relation to imputation 4(b) in the first matter complained of, I am satisfied that imputation 6(b) is not reasonably capable of being conveyed.

53. As to imputation 6(d), the omission of the first portion of the second matter complained of concerning urgency makes an even stronger case for finding that this imputation is not reasonably capable of being conveyed.

Form of imputations

54. There were substantial issues in relation to the question of form to which I will avert only briefly, given my rulings in relation to capacity. The first of these is that imputations of guilt and reasonable suspicion should be pleaded as fall backs if the same conduct is encapsulated (which Mr Weaver says is the case here) and the second is that, for the reasons set out in the authorities listed above, the party holding that suspicion should be identified with some degree of precision.

Costs and the future conduct of these proceedings

55. The manner in which these proceedings have been conducted by the defendant appear to include misunderstandings as to the basis upon which challenges to form and capacity of imputations should be brought. In this regard, I note that although I raised with the parties whether the principles set out in Kostov v Nationwide News Pty Ltd [2018] NSWSC 858 should be applied, no such application has been made.

56. Nor was any application made conformably with the principles set out in Bik v Mirror Newspapers Ltd [1979] 2 NSWLR 679 n.

57. Finally, I was not addressed as to whether, if the imputations were to be struck out, any application to replead should be permitted. The plaintiff should, however, be entitled to replead the case.

58. I propose to invite the parties to bring in short minutes of order reflecting the future conduct of the matter and to content myself with striking out the imputations and reserving the issue of costs.

Orders

1. Imputations 4(a) to 4(d) and 6(a) to 6(d) are struck out as not reasonably capable of being conveyed by each of the first and second matters complained of respectively.

2. Costs reserved with liberty to apply.

3. The parties are to bring in short minutes of order in relation to the future conduct of these proceedings.

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Decision last updated: 12 June 2019