Douglas v McLernon (No 4)
[2016] WASC 320
•7 OCTOBER 2016
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: DOUGLAS -v- McLERNON [No 4] [2016] WASC 320
CORAM: KENNETH MARTIN J
HEARD: 20 - 23 JUNE 2016
DELIVERED : 7 OCTOBER 2016
FILE NO/S: CIV 1930 of 2012
BETWEEN: OLIVER GEORGE DOUGLAS
Plaintiff
AND
TERENCE JOHN McLERNON
Defendant
FILE NO/S :CIV 2306 of 2012
BETWEEN :OLIVER GEORGE DOUGLAS
Plaintiff
AND
TONI FITZGERALD
Third DefendantLAURENCE KERRY FITZGERALD
Fourth Defendant
FILE NO/S :CIV 2307 of 2012
BETWEEN :ANTHONY BILLIS
Plaintiff
AND
TERENCE JOHN McLERNON
First DefendantTONI FITZGERALD
Fourth DefendantLAURENCE KERRY FITZGERALD
Fifth Defendant
FILE NO/S :CIV 2308 of 2012
BETWEEN :PAUL MATICH
Plaintiff
AND
TERENCE JOHN McLERNON
First DefendantTONI FITZGERALD
Fourth DefendantLAURENCE KERRY FITZGERALD
Fifth Defendant
Catchwords:
Defamation - Internet websites - Three plaintiffs - Trials of actions heard in sequence - Defendants in person - First defendant amends his three defences in three actions to withdraw his former admissions as to his authorship and publications - False innuendos established in most publications - Defamatory meanings established - Damages assessment - Permanent injunctions sought against first defendant - Action against fifth defendant for publishing assistance or responsibility for materials on websites
Legislation:
Defamation Act 2005 (WA)
Result:
Judgment for plaintiffs for damages and permanent injunctions against first defendant
Actions against other defendants dismissed
Category: B
Representation:
CIV 1930 of 2012
Counsel:
Plaintiff: Mr G Mukherji
Defendant: In person
Solicitors:
Plaintiff: Tindall Gask Bentley Lawyers
Defendant: In person
CIV 2306 of 2012
Counsel:
Plaintiff: Mr G Mukherji
Third Defendant : In person
Fourth Defendant : In person
Solicitors:
Plaintiff: Tindall Gask Bentley Lawyers
Third Defendant : In person
Fourth Defendant : In person
CIV 2307 of 2012
Counsel:
Plaintiff: Mr G Mukherji
First Defendant : In person
Fourth Defendant : In person
Fifth Defendant : In person
Solicitors:
Plaintiff: Tindall Gask Bentley Lawyers
First Defendant : In person
Fourth Defendant : In person
Fifth Defendant : In person
CIV 2308 of 2012
Counsel:
Plaintiff: Mr G Mukherji
First Defendant : In person
Fourth Defendant : In person
Fifth Defendant : In person
Solicitors:
Plaintiff: Tindall Gask Bentley Lawyers
First Defendant : In person
Fourth Defendant : In person
Fifth Defendant : In person
Case(s) referred to in judgment(s):
Ali v Nationwide News Pty Ltd [2008] NSWCA 183
Australian Broadcasting Corporation v O'Neill [2006] HCA 46; (2006) 227 CLR 57
Billis v McLernon [2013] WASC 128
Broome v Cassell & Co Ltd [1972] AC 1027
Buckley v The Herald & Weekly Times Pty Ltd [2009] VSCA 118; (2009) 24 VR 129
Carson v John Fairfax and Sons Ltd [1993] HCA 31; (1993) 178 CLR 44
Dank v Whittaker (No 4) [2014] NSWSC 732
Davis v Nationwide News Pty Ltd [2008] NSWSC 693
Donyette Pty Ltd v Toplodge Nominees Pty Ltd [2010] WASC 388
Douglas v McLernon [2013] WASC 126
Douglas v Purpose Marketing Group Pty Ltd [2013] WASC 125
Dow Jones & Co Inc v Gutnick [2002] HCA 56; (2002) 210 CLR 575
Duffy v Google Inc [2015] SASC 170
Farrell v Allregal Enterprises Pty Ltd [No 2] [2009] WASC 65
French v Herald and Weekly Times Pty Ltd (No 2) [2010] VSC 155; (2010) 27 VR 171
Fullam v Newcastle Chronicle & Journal Ltd [1977] 1 WLR 651
Graham v Powell (No 4) [2014] NSWSC 1319
Higgins v Sinclair (No 2) [2011] NSWSC 238
Higgins v Sinclair [2011] NSWSC 163
Hockey v Fairfax Media Publications Pty Ltd (No 2) [2015] FCA 750; (2015) 237 FCR 127
Jones v Dunkel (1959) 101 CLR 298
Kenyon v Sabatino [2013] WASC 76
Kingsfield Holdings Pty Ltd v Rutherford [2016] WASC 117
Lazarus v Deutsche Lufthansa AG (1985) 1 NSWLR 188
Lewis v Daily Telegraph Ltd [1964] AC 234
Ley v Hamilton (1935) 153 LT 384
Matich v McLernon [2013] WASC 127
Moran v Schwartz Publishing Pty Ltd [2014] WASC 334
Ratcliffe v Evans [1892] 2 QB 524
Reader's Digest Services Pty Ltd v Lamb (1982) 150 CLR 500
Royal Society for the Prevention of Cruelty to Animals New South Wales v Davies [2011] NSWSC 1445
Schellenberg v Tunnel Holdings Pty Ltd [2000] HCA 18; 200 CLR 121
Shea v News Ltd [2015] WASC 1
Sierocki v Klerek (No 2) [2015] QSC 92
Sims v Jooste [No 2] [2016] WASCA 83
Swansdale Pty Ltd v Whitcrest Pty Ltd [2010 WASCA 129 (S)
The Herald and Weekly Times Ltd v McGregor (1928) 41 CLR 254
Trkulja v Google (No 5) [2012] VSC 533
Urbanchich v Drummoyne Municipal Council (Unreported, NSWSC, 22 December 1988)
Webb v Bloch (1928) 41 CLR 331
Table of Contents
Preamble
An overview of four defamation actions
The Fitzgeralds
Three fundamentals
Internet publications
The three defamation actions brought against Mr McLernon by Messrs Douglas, Billis and Matich
CIV 1930 of 2012: Mr Douglas' action against Mr McLernon
Four internet website publications complained of by Mr Douglas
True innuendo meanings complained of by Mr Douglas in Annexure A
CIV 2307 of 2012: Mr Billis' action against Mr McLernon
CIV 2308 of 2012: Mr Matich's action against Mr McLernon
Responsibility: Mr McLernon
Summary of position in respect of the three defamation actions against Mr McLernon
Degree of publication: Mr Douglas
Degree of publication: Mr Billis
Degree of publication: Mr Matich
Key contested issue: the authorship and publication of the internet materials complained of as against Mr McLernon (first defendant in CIV 1930 of 2012, CIV 2307 of 2012 and CIV 2308 of 2012)
Mr McLernon's memory problems at the trial
Other witnesses
Events prior to Mr McLernon being cross‑examined in the Douglas actions
Mr McLernon's cross‑examination
My assessment of Mr McLernon's evidence
Determinations as to Mr McLernon's authorship and publication of the internet publications complained of
Postscript to my assessment of Mr McLernon as a witness
Circumstances bearing upon an aggravation of the plaintiffs' damages
Liability of Laurence Fitzgerald for publication
Fate of the corporate co-defendants
Allegations against Redback Studios Australia Pty Ltd
Allegations against Mr Fitzgerald personally
Allegations against Mr Fitzgerald as to liability for publication - upload, design or modification of material on websites
Alternative allegations against Mr Fitzgerald as to liability for publication
Issuing and receipt of concerns notices: evidence summary
Mr Fitzgerald: evaluation
The relief against Mr McLernon
Damages
The alleged harm suffered by the plaintiffs
Aggravated damages
Awards of damages, interest and costs
Permanent injunctions against Mr McLernon
Injunction determinations
Conclusions
Orders
A. CIV 1930 of 2012:
B. CIV 2306 of 2012:
C. CIV 2307 of 2012:
D. CIV 2308 of 2012:
Postscript regarding the Fitzgeralds' costs circumstances
KENNETH MARTIN J:
Preamble
There still manifests a perception in some members of the community that the laws of defamation do not apply to publications made over the internet. Consequently, there is a lingering misapprehension that anything at all can be posted concerning another person over the internet ‑ no matter how defamatory or scandalous the uploaded material may be ‑ and that the posted material will enjoy a complete immunity. That perception is wrong as these reasons for decision will illustrate.
An overview of four defamation actions
What follows are my reasons for decision in four defamation actions. The actions are brought by three distinct plaintiffs: Mr Oliver George Douglas, Mr Anton Billis, and Mr Paul Matich.
Mr Douglas brings two of the civil actions, but against different defendants. CIV 1930 of 2012 was commenced against Mr Terence John McLernon, while CIV 2306 of 2012 was commenced against Ms Toni Fitzgerald and Mr Laurence Kerry Fitzgerald (the Fitzgeralds are siblings) (as well as further corporate defendants who are no longer parties to the action). Mr McLernon and the Fitzgeralds are the only (remaining) defendants across all four actions. For all intents and purposes, Mr Douglas' two defamation actions can be assessed in aggregate. They were trials heard together as the first of what are, effectively, three plaintiffs' individual defamation complaint scenarios against common defendants.
The second scenario is CIV 2307 of 2012, the defamation action commenced by Mr Billis against Mr McLernon and the Fitzgeralds (as well as further corporate defendants who are no longer parties to the action).
The third scenario is CIV 2308 of 2012, the defamation action commenced by Mr Matich against Mr McLernon and the Fitzgeralds (and also further corporate defendants who are no longer parties to the action).
I have case managed these four actions in the Commercial and Managed Cases (CMC) list since November 2014. Prior to that, they were managed by Le Miere J. The actions have been the subject of a number of prior interlocutory decisions concerning pleading issues: see Douglas v Purpose Marketing Group Pty Ltd [2013] WASC 125; Douglas v McLernon [2013] WASC 126; Matich v McLernon [2013] WASC 127; Billis v McLernon [2013] WASC 128.
Pursuant to my pre‑trial directions, the four defamation actions against Mr McLernon and the Fitzgeralds were to be conducted across consecutive hearing days, commencing on 20 June 2016. By those directions, Mr Douglas' two actions were heard together and first, for the purpose of adducing evidence. I made a further pre‑trial direction to the effect that the evidence adduced in one action would stand as evidence in the other actions. That occurred albeit the evidence in each of the three plaintiff's actions was heard and received discretely.
Closing submissions in all four actions were rendered on an aggregate basis at the close of the evidence in the last action heard, being Mr Matich's action CIV 2308 of 2012.
Pre‑trial directions were also made for the filing and serving of papers for the judge by the plaintiffs. That trial bundle (TB) included documents that were adduced as evidence in the course of the trial.
I should also observe that all defendants in the four actions appeared in person, without legal representation.
The Fitzgeralds
In the case of the Fitzgeralds, for most of the trial they participated under my pre‑trial directions via a telephone link from Sydney, New South Wales to Perth, Western Australia, where the trials were conducted. However, Ms Toni Fitzgerald had foreshadowed a no case to answer submission in respect of all three defamation actions against her by Messrs Douglas, Billis and Matich.
I heard and determined the no case submission of Ms Fitzgerald in the Douglas action (CIV 2306 of 2012) over a video link established to Sydney on the morning of the third day of the hearing. That 'no case' argument was conducted, effectively, at the close of all the evidence received in Mr Douglas' two actions being heard together (CIV 1930 of 2012 and CIV 2306 of 2012).
The publications that were the subject of the plaintiffs' complaints against the Fitzgeralds align precisely with the internet publications complained about in the three actions against Mr McLernon.
Liability arguments against the Fitzgeralds in all actions were articulated on a basis of submissions concerning their alleged assistance towards the publications and so, their alleged accessorial liability in tort in relation to the publications on internet websites allegedly made by Mr McLernon (ie for his authoring and causing the matter complained about to appear on three internet websites in his alleged control).
It was not suggested by any of the plaintiffs that either of the Fitzgeralds had ever been personally involved as individuals in compiling any of the identified publications and matters complained about by Mr Douglas, Mr Billis and Mr Matich vis-à-vis the internet websites.
The plaintiffs effectively contended against the Fitzgeralds that, by their associations with various websites, either personally or via website servicing corporations for which they were corporate directors, they had thereby assisted Mr McLernon in a general sense, to publish and circulate (ie to upload to the internet on the three websites complained about) the publications complained about in the period around 2011 to 2012.
Furthermore, it was contended that after an issue of concerns notices, under the provisions of s 14 of the Defamation Act 2005 (WA), the Fitzgeralds had thereafter neglected to take steps to halt Mr McLernon's ongoing (alleged) use of the three websites. This alleged failure of the Fitzgeralds to effectively intervene, as it was put, established their personal liability for assisting in the continuance of the defamatory publications on the internet. The submission was said to invoke a principle concerning assistance in the tort of defamation, going back to the High Court's decision in Webb v Bloch (1928) 41 CLR 331, 363 ‑ 366.
After hearing from Ms Fitzgerald, I determined the no case submission in her favour. I should record that my reasons provided ex tempore at the time for upholding the no case to answer submission of Ms Fitzgerald were revised and have been published separately to these reasons as Douglas v McLernon [No 3] [2016] WASC 319.
Consequently, at about 11.00 am on day three of the trial, I dismissed Mr Douglas' defamation action against Ms Fitzgerald as a defendant (see ts 522 ‑ 523). As a result of that determination the actions against Ms Fitzgerald, commenced by Mr Billis in CIV 2307 of 2012 and by Mr Matich in CIV 2308 of 2012, were no longer pressed by counsel (see ts 523). Accordingly, all three actions against Ms Fitzgerald were dismissed at that point (see ts 524). The consequence was then to leave Mr Fitzgerald as a residual defendant in actions CIV 2306, 2307 and 2308 of 2012.
Mr Fitzgerald did not put forward a no case to answer submission for the three actions in which he was a defendant. Nevertheless, his in person defences as filed in the three actions concerning him, all denied any liability in tort for assisting in any of the internet website publications complained of against Mr McLernon by the plaintiffs.
Mr Fitzgerald represented himself in person by telephone. His position as defendant in the three defamation actions was essentially to dispute liability, but to offer no affirmative evidence. Mr Fitzgerald simply denied all liability, referred to the denials of all allegations against him in his pleaded defences, and did not augment those pleaded defences by any further affirmative submissions.
I had been told at earlier directions hearings (and it does not appear to be a matter in dispute) that Mr Fitzgerald had been declared bankrupt at some earlier point and remains subject to that condition.
The corporation with which Mr Fitzgerald was once associated, namely Redback Studios Australia Pty Ltd (formerly a defendant in each of actions CIV 2306, 2307 and 2308 of 2012) was deregistered in May 2014. Consequently, the action brought against it by each of the plaintiffs was dismissed under earlier pre‑trial orders of the court, issued in September 2015.
I deal with the defamation exposure and arguments concerning Mr Fitzgerald in a discrete section at the end of these reasons.
I will now consider the three defamation actions brought against the principal defendant, Mr McLernon, under defamation actions CIV 1930, 2307 and 2308 of 2012 by Messrs Douglas, Billis and Matich, respectively. At the outset of that exercise I need to record three fundamental points.
Three fundamentals
In the first place it is necessary to observe that s 8 of the Defamation Act provides:
A person has a single cause of action for defamation in relation to the publication of defamatory matter about the person even if more than one defamatory imputation about the person is carried by the matter.
The plaintiffs complained of multiple alleged defamatory imputations published by Mr McLernon in the materials that he allegedly authored and then allegedly uploaded to the three websites in question. Accordingly, it is important to note at the outset that while there may be multiple defamatory imputations extracted from a particular publication complained about, there is only one cause of action per publication in defamation that arises, notwithstanding an aggregate manifestation of many defamatory meanings. That conclusion in turn has a repercussion: in respect of a particular publication it may be seen that some imputations are found to be established, whereas others are not. As long as one defamatory imputation is found in a publication the plaintiff will then have established a cause of action.
The second fundamental point is that there was no real contest before me in respect of the principles applicable under defamation law concerning the legal tests applied in order to establish whether a particular alleged meaning is carried under the natural and ordinary meaning of words, and then, whether the meaning complained of is defamatory or not. Recently, in Kingsfield Holdings Pty Ltd v Rutherford [2016] WASC 117, I collected together at some length the principles of law applicable to such an exercise. Here then, I will simply make a passing reference to the paragraphs of those reasons which collect the relevant law and legal principles: see Kingsfield [162] ‑ [172] under the heading 'General principles, defamation'.
The principles are somewhat different in respect of arguments towards an imputation based upon an extra ingredient of knowledge held by a particular reader, whereby such knowledge, combined with a reading of the words at issue, is said to bear an imputation, which is known as a true or legal innuendo. I also dealt with that issue in Kingsfield: see [162] ‑ [172], [304]. The law in that respect is not at issue in this litigation.
The first publication complained of by Mr Douglas is the subject of a surrounding true or legal innuendo argument. He argues that one of the meanings of the publication is a meaning that would have been reached by persons holding certain levels of knowledge about the management of corporations and, in particular, the content of a section of the Corporations Act 2001 (Cth), concerning the lawful nature of an act by way of management of a corporation carried out by a person who is an undischarged bankrupt. Save for that imputation (said to arise under the first publication complained about by Mr Douglas), the balance of the multiple claims of defamatory imputations brought by all of the three plaintiffs against Mr McLernon are based upon the natural and ordinary meaning of the words complained about. That genre of argued meaning, predicated upon what the ordinary reasonable reader of the words would assess them to mean (that is without any extra personal knowledge by way of augmentation to the words of the text), is called popular or false innuendo.
The third fundamental point to address at the outset is to observe that in defamation actions the question of identification of a particular plaintiff under words complained about can be a very significant issue. See again, for instance, my observations made in Kingsfield concerning identification, which was very much at issue in respect of the corporate plaintiff in that litigation: [110] ‑ [143].
Here, the question of identification of each plaintiff under the matters complained about is, in general, not a live obstacle to the establishment of the plaintiffs' claims. Usually, they are expressly identified by name, particularly their surnames. On other occasions, the publication complained of has used a prefix or nickname before referring to the plaintiffs' surname. For instance, there are references in the materials complained of to 'Dodgy Douglas', 'Dictator Billis' and 'Noddy Matich', ostensibly referring to the plaintiffs, Messrs Douglas, Billis and Matich, respectively. In the circumstances, there is no serious contention that the plaintiffs are not expressly identified under these particular publications complained about.
Hence, in this series of defamation actions, the issue of plaintiff identification does not present as any live obstacle to an establishment of liability, if the plaintiffs can otherwise show that they have been defamed under the publications complained of.
Internet publications
Before proceeding to evaluate each of the publications complained of, it is convenient to render some observations about the state of the law concerning the still relatively new phenomenon of internet publications. The Western Australian Court of Appeal has recently dealt with this issue in its reasons in Sims v Jooste [No 2] [2016] WASCA 83, delivered 20 May 2016.
In the present case the internet publications complained of are publications posted upon three websites which I will mention later in these reasons. That scenario is to be distinguished from the underlying facts in Sims v Jooste [No2], which concerned a post made to an externally operated internet blogging site.
The lead reasons in that decision were delivered by Martin CJ with whom Buss JA and Mitchell J (as his Honour then was) agreed. The case concerned a posting made over an internet chat/comment/gossip website known as 'HotCopper'. Mr Sims was a self‑represented litigant. In the end his action failed because he could not prove that any third person had viewed the post which he was complaining about as defamatory of him.
The Chief Justice's reasons contain the following observations concerning the bilateral nature of the concept of publication in defamation law and, then, the importance of that distinction in a context of evaluating alleged defamatory publications over the internet [7]:
Damage is the gist of an action in tort, and damage to reputation is the gist of an action in defamation. The remedies granted by a court to a successful plaintiff in a defamation case are directed to the vindication of reputation; the protection of the plaintiff from further damage to reputation; and the award of damages to compensate the plaintiff for the damage to reputation which he or she has suffered.
His Honour then quoted from Dow Jones & Co Inc v Gutnick [2002] HCA 56; (2002) 210 CLR 575 [26] ‑ [27] (Gleeson CJ, McHugh, Gummow & Hayne JJ) (Dow Jones):
Harm to reputation is done when a defamatory publication is comprehended by the reader, the listener, or the observer. Until then, no harm is done by it. This being so it would be wrong to treat publication as if it were a unilateral act on the part of the publisher alone. It is not. It is a bilateral act - in which the publisher makes it available and a third party has it available for his or her comprehension.
The bilateral nature of publication underpins the long-established common law rule that every communication of defamatory manner founds a separate cause of action.
Specifically concerning publications over the internet, the Chief Justice then said at [10] ‑ [11]:
In very general terms, the internet permits a person with a computer, or other internet-compatible device, and an internet service provider, to communicate with other such computers or devices on the world wide web, including computers or devices upon which internet sites are maintained (servers). Sites accessible via the internet are of many kinds. They include sites on which all of the available information is provided by the controller of that site. For example, all the information on the website maintained by the Supreme Court of Western Australia is uploaded to that site by officers of the court. When that information is uploaded to the server, it is published, in the non-legal sense of that word. Publication in the legal sense only occurs if and when somebody uses a browser or other device to access that site and thereby sees, and comprehends, the information which has been uploaded. Because access by a third party to the defamatory material posted on a site must be established before it can be said that the material has been 'published' in the legal sense, the High Court has held that, in the case of publication via the internet, the tort of defamation is committed in the place in which the computer or device which is used to retrieve the information from the server is located, rather than in the place at which the server is located (Dow Jones).
Other types of sites on the internet include sites to which materials, such as words or pictures, can be uploaded by persons other than the controller of the site. Some of these sites are described as 'blogs' and others as 'chat' sites. As a matter of logic, those sites might operate by permitting anybody to upload any information they wish to the site without intervention by the controller of the site. (For a more detailed description of such a site, see Metropolitan International Schools Ltd v Designtechnica Corp[2009] EWHC 1765 (QB); [2011] 1 WLR 1743 [4] ‑ [5].) Alternatively, they might operate on the basis that information or data provided by third parties is only uploaded to the site by the positive act or intervention of the controller of the site. If a site was of the latter kind, the posting of material on the site would, of itself, provide evidence of publication in the legal sense, in the form of the submission of words or data by the originator to the controller or operator of the site whose intervention is necessary for the material to be uploaded. However, if a site is of the former kind, material could be uploaded onto the server without publication in the legal sense occurring. In such a case, publication in the legal sense would only occur if and when a third party accessed the information which had been uploaded to the site.
Martin CJ also made the following observations upon the nature of internet sites at [17]:
Because of the vast number of internet sites, and the vast number of web pages accessible through those internet sites, in the absence of evidence it cannot be inferred that one or more persons has undertaken the steps required to identify and access any particular web page available through the internet merely from the fact that material has been posted on an internet site. There is a real prospect that many of the billions of web pages accessible via the internet have never been seen by anyone other than the person who posted the page on an internet site.
See also the remarks at [18] ‑ [20], concerning the state of the law as regards internet publications and the absence of the ability to draw an inference customarily drawn for publications made over the mass media of print and broadcast to establish that there had been a substantial publication within the relevant jurisdiction.
Unlike the facts of Sims v Jooste [No 2], for the present case there is affirmative evidence concerning a third party's downloading and review of all these internet publications complained about by each of the plaintiffs by a Western Australian resident witness (a Mr Terry Magee).
Each of the plaintiffs by their affidavits (exhibits 4 and 9 in the case of Mr Douglas; exhibit 19 in the case of Mr Billis; and exhibit 28 in the case of Mr Matich) gives evidence concerning the reactions of third persons towards them, by reference to an adverse reputational effect upon them by those publications. In other words, each of the three plaintiffs has described various scenarios in which the reactions of third persons in the aftermath of them having seen the internet material complained of and then reacting towards each plaintiff by a comment in relation to the reputations of each of the plaintiffs. That material assists me in concluding that, in each instance complained about as a publication by each plaintiff, the scope of the circulation of the material in Western Australia to third persons who accessed it over the internet was significant. It was not only significant in its range of internet‑using recipient, but was also strongly adverse, in the sense of the negative reputational impact as against each of the plaintiffs.
Each of the plaintiffs relates having suffered embarrassment in terms of their interactions and dealings with third persons as a result of the circulation of the materials complained about, and of their efforts to try and deal with that situation as best they could to mitigate the adverse effects of such material against their reputations. Each of Messrs Douglas, Matich and Billis confirmed at their trials that the content of their respective affidavits (which contained their trial evidence) was true and correct, as each had sworn. Given all that, it is forensically significant that Mr McLernon, the first defendant in each of these actions, and who is alleged by the plaintiffs to have been the author and publisher over the internet to the three websites at issue, declined to cross‑examine Mr Douglas (ts 408), Mr Billis (ts 659 ‑ 660) and Mr Matich (ts 675). Albeit he was representing himself in person at these trials, Mr McLernon did not avail himself of the opportunity he held to cross‑examine any of the plaintiffs when they gave their evidence at the trials. Hence, the evidence of Messrs Douglas, Billis and Matich was not challenged in cross‑examination. Nor was it challenged by either of Mr or Ms Fitzgerald. Hence, the plaintiffs' evidence about suffering adverse reputational effects from these publications stands as wholly unchallenged.
The three defamation actions brought against Mr McLernon by Messrs Douglas, Billis and Matich
Mr McLernon has acted in person in defending the actions brought against him at all times. Mr McLernon appeared and represented himself in person at the trials across the hearing days of the four trials between 20 and 23 June 2016.
Mr Douglas' action against Mr McLernon (CIV 1930 of 2012) was the first of the four defamation actions to be commenced. That was by writ of summons on 25 May 2012.
Mr Douglas' second action, against the Fitzgeralds as defendants (CIV 2306 of 2012), as well as Mr Billis' action (CIV 2307 of 2012) and Mr Matich's action (CIV 2308 of 2012) against all defendants, were commenced by writs filed on 1 August 2012.
By the terms of s 15 of the Limitation Act 2005 (WA), a plaintiff ordinarily has 12 months to commence proceedings in respect of an allegedly defamatory publication.
Essentially, Messrs Douglas, Billis and Matich all complain of articles published over the internet concerning them by Mr McLernon and upon three websites identified as:
a) and
c)>
As discussed below, the three websites were referred to in the plaintiffs' respective statements of claim in aggregate as the 'McLernon File Website'.
CIV 1930 of 2012: Mr Douglas' action against Mr McLernon
Mr Douglas complains about material alleged to be authored by Mr McLernon appearing on the three websites, all contended to be controlled by Mr McLernon and to which it is said that he allegedly uploaded content across the period 13 October 2011 to 18 September 2012 (a date at which it is accepted by all plaintiffs that these websites were 'shut down' - see plaintiffs' chronology, TB 1903 ‑ 1914).
The most contemporary iteration of Mr Douglas' pleaded statement of claim, filed 25 November 2013, has four hard copy annexures (A ‑ D). Those four annexures display words published in English that, it is contended, appeared on, or were accessible via, all three of the above websites (the same content is complained about as appearing on all three websites).
Mr Douglas complains that these four publications over the internet defamed him. He refers to the publications as downloaded from those websites (the three websites being referred to in aggregate under par 2b of Mr Douglas' statement of claim as the 'McLernon File Website'), and viewed in Western Australia, including by Mr Magee (see particulars to par 4 of the statement of claim as to publication).
As I mentioned earlier, Mr Magee was a witness called at the trials. Under my pre‑trial directions, evidence‑in‑chief from trial witnesses was to be by affidavits, which were exchanged prior to trial.
Mr Magee provided an affidavit sworn 12 March 2016 (which became exhibit 5), relating his conduct in personally downloading and then viewing all of the internet publications complained of in Western Australia for not only Mr Douglas, but also for all the publications complained about in the other actions by Messrs Billis and Matich.
Mr Magee attended court in person as a witness called by Mr Douglas (ts 411 ‑ 439, 443 ‑ 467), in order to confirm and admit his affidavit evidence.
Under my pre‑trial directions for all the actions, Mr Magee's trial evidence stands as evidence not only in the actions brought by Mr Douglas, but also in the actions brought by Mr Billis and Mr Matich. Its content goes directly towards proving and satisfying the issue of publication (in the legal sense) of all the internet material that is complained about by all three defamation plaintiffs, as explained in Sims v Jooste [No 2]. That is, it has been proven by Mr Magee's evidence that all the internet material complained of has been viewed by some third party. Hence, the obstacle that arose in Sims v Jooste [No 2] is met by evidence in these four trials.
Although some questions in the way of attempted cross‑examination were directed at Mr Magee from Mr McLernon (acting in person), none of his questions sought to take issue with Mr Magee's evidence concerning his asserted viewing of all of the internet publications that are complained of (see pars 26 ‑ 29, 30 ‑ 37 and 38 ‑ 41).
Some hostile questioning directed at Mr Magee by Mr McLernon carried the underlying suggestion that Mr Magee was a generally unreliable witness and a person whose evidence ought never be accepted. Mr Magee rejected all of Mr McLernon's contentions as to his dishonesty or suggested improprieties. There is nothing independent before me to support or to allow a basis for accepting any of Mr McLernon's attacks against Mr Magee.
Consequently, I will accept that Mr Magee's evidence establishes his position as that of an independent third party reader viewing, downloading or otherwise accessing and then reading in Western Australia all of the internet publications complained of (and which he attaches to his affidavit, which was confirmed and admitted as his evidence‑in‑chief) over the relevant internet sites, essentially on an uncontradicted basis.
As a result, there has been proven a publication to a third party in respect of all publications complained of by each plaintiff. Moreover, I expressly conclude that the viewing, downloading and reading of all this material took place geographically within Western Australia. No suggestion to the contrary was put to Mr Magee. Mr Magee is a resident of North Fremantle, Western Australia and that was the logical interpretation of his evidence.
Hence, from the perspective of identifying a completed cause of action under the tort of defamation arising within the State of Western Australia, I am satisfied that all the internet publications complained of by each of the three plaintiffs have been proven as being viewed, downloaded and read by a third party (Mr Magee), thereby establishing their legal publication to at least one person under the second meaning of that term as was explained by the High Court in Dow Jones and as recently applied by the Western Australian Court of Appeal in Sims v Jooste [No 2].
Four internet website publications complained of by Mr Douglas
I do not wish to enshrine or perpetuate in these reasons an existence or circulation of the material complained about by the plaintiffs beyond the minimum degree necessary to resolve the subsisting issues in the four defamation actions.
In short, Mr Douglas complains that various meanings (defamatory imputations) injurious to his reputation are carried by this published internet material. There is no live issue about Mr Douglas' personal identification in the publications he complains about. He is expressly named in each of the four publications complained of as 'Oliver George Douglas'. For the moment I will defer dealing with the Annexure A publication, as one imputation complained of is in the nature of a legal or true innuendo. I will deal at the outset with Annexures B, C and D, which are alleged to carry only defamatory meanings arising from the natural and ordinary meaning of the words used in each publication.
Mr Douglas says the second publication he complains of (in hard copy as Annexure B to his statement of claim and as 'OGD‑H' to exhibit 4 ‑ pages 74 ‑ 102 or TB 151 ‑ 180), carried false imputations that Mr Douglas: threatens innocent women and children using internet sites; knowingly associates with a notorious corrupt police officer; has been convicted of a series of criminal offences in Queensland; has stolen $500,000 from a corporation of which he was a director and was found guilty by a court of that offence; has stopped officers from the Australian Securities and Investments Commission (ASIC) from investigating him by obstructing, terrorising or intimidating those officers; has set up large numbers of companies for the sole purpose of avoiding paying creditors; and has fraudulently obtained millions of dollars by false loan applications.
The third publication complained of by Mr Douglas (Annexure C) is said to carry multiple false and defamatory meanings (imputations) to the effect that Mr Douglas: is a member of an organised crime gang (known as the 'Fat Wallet Mob'); has been charged with civil and criminal offences in three different states; committed fraud while working as the treasurer of a named corporation; worked with a well-known deceased Perth businessman to commit fraud and perpetrate a financial scam; and stole $400,000 from a named Malaysian politician.
Mr Douglas then complains that the natural and ordinary meanings arising from the fourth internet publication (Annexure D) raise numerous, distinct, false and defamatory imputations as to Mr Douglas being: known by the general public to be a distributor of pornographic, degrading and immoral materials, using unregistered websites and the internet; an operator of internet sites which distribute and make available pornography for a long period; paid to post false accusations about the sexuality of business competitors on internet sites for the purpose of blackmailing them; found by a judge of the Court of Appeal to be dishonest and that a judgment was handed down to this effect; a regular poster of pornography and other immoral materials involving women and children on the internet using Facebook, Twitter and emails; likely to physically harm women and people who are infirm; and mentally unstable and needing to be committed to a mental institution because he is dangerous to others, in particular to women and the infirm, and also to his bearing a responsibility for a certain notorious former police officer in Western Australia committing suicide (by hanging himself).
Merely for me to set out and record the disparate and multiple abovementioned imputations should show, without need for any greater elaboration, how seriously pejorative and damaging they would be to a person's reputation. If those meanings, which are asserted to arise from the internet published materials complained of, do arise as meanings, then, almost inevitably, given their seriously pejorative gravity, they must be assessed as being statements which are defamatory of Mr Douglas' character and reputation ‑ in the legal sense of that word: see observations of Brennan J in Reader's Digest Services Pty Ltd v Lamb (1982) 150 CLR 500 [7]. Accordingly, there is little need to dwell unduly upon the issue of whether these meanings, if shown to arise, are defamatory of Mr Douglas. Clearly they are, if they arise.
The second and more substantive issue is whether the meanings said to arise by Mr Douglas from the articles complained of, do arise from the text of the words complained about. In other words, are these meanings proven as arising from the natural and ordinary meanings of the words that were published over the internet?
In short, I would answer that question in the affirmative, in respect of all meanings complained about, as regards the publications complained about by Mr Douglas as Annexures B, C and D to his statement of claim.
Under the uniform defamation Acts in Australia, and in particular under the Defamation Act 2005 (WA), operative from 1 January 2006, the law is now that a cause of action under the tort of defamation arises upon the particular publication concerned - rather than upon each particular individual imputation: see s 8 of the Defamation Act. Each of the articles complained of by Mr Douglas as the second, third and fourth publications complained of (Annexures B ‑ D to his statement of claim) constitutes a cause of action in defamation by reference to each such publication (and so, not by reference to each individual defamatory imputation within these publications).
Subject to showing Mr McLernon is author of all that material appearing on the three identified websites, I can conclude here that Mr Douglas has proven that he has been defamed by Mr McLernon by the publication of these materials over the internet.
As will be seen, the only substantive issue put into contest is whether or not Mr McLernon, as a matter of fact, was actually the author of this website material and is responsible for uploading it to the internet. The issues and the evidence in relation to proof of that substantially contested element in these trials are somewhat blurred, as I will explain.
True innuendo meanings complained of by Mr Douglas in Annexure A
The position in respect of Annexure A is somewhat different. In the first place there is a grievance raised by Mr Douglas under par 5 of his statement of claim concerning a popular or false innuendo meaning he asserts, to the effect that Mr Douglas 'committed a criminal offence by attempting to leave the jurisdiction so as to evade his creditors that warranted him being put in jail'. The particular words relied upon as conveying this natural and ordinary meaning are particularised under par 5 of Mr Douglas' statement of claim. The words relied upon are that: 'Dodgy Douglas, going to gaol on absconding debtor's warrants, taken off the planes and more, all in one weekend' (appearing on page 0007 of Annexure A).
I have little doubt that the identified words within Annexure A also carry a defamatory meaning against Mr Douglas concerning his 'going to gaol'. However, I am not persuaded, without more, that the precise imputation that is complained of as regards Mr Douglas attempting to 'evade his creditors' is capable of being derived as a natural and ordinary meaning of these words. Consequently, I do not accept that this particular meaning has been shown as a popular or false innuendo, arising from the natural and ordinary meaning of the words used.
Perhaps because of a perceived difficulty of the pleader in extracting that meaning from the words alone, the statement of claim then goes on, via par 6 and par 7 to contend for a legal or true innuendo - that is, for a meaning said to be capable of being derived from the words complained of by a person who has the benefit of holding some additional underlying personal knowledge that is used to add to the words in order to arrive at the meaning contended for. In this situation I again note the recent observations of the Court of Appeal in Sims v Jooste [No 2] where Martin CJ said:
There is one exception to this general principle in cases involving publication by the mass media. In cases in which the plaintiff relies upon a true innuendo - that is to say, an imputation which would only be drawn from the material complained of by persons with knowledge of facts extrinsic to the publication, the plaintiff will be required to provide particulars of, and prove, publication to persons with knowledge of those extrinsic facts [14].
(In support of that statement, Martin CJ referred to Fullam v Newcastle Chronicle & Journal Ltd [1977] 1 WLR 651, a decision itself cited with approval by Hunt J in Lazarus v Deutsche Lufthansa AG (1985) 1 NSWLR 188, 193.)
The true innuendo meaning as contended for under par 6 of the statement of claim is bifurcated. It contends on behalf of Mr Douglas:
Further, some persons to whom the First Publication was published knew that:
a.the plaintiff, at the time of the publication to those persons, was an undischarged bankrupt; and
b.persons who are undischarged bankrupts are prohibited by law from taking part in the management of corporations.
The particulars provided for this plea were:
i)The plaintiff was made bankrupt on 26 August 2010;
ii)the matter referred to in i) was known to some persons to whom the First Publication was published. Further particulars cannot be provided until after discovery and interrogatories;
iii)by section 206B(3) of the Corporations Act 2001 (Cth) an undischarged bankrupt is disqualified from managing corporations; and
iv)the matters in iii) were known to some persons to whom the First Publication was published.
A second true (legal) innuendo meaning is contended for under par 7 of the statement of claim of Mr Douglas, as regards this same publication. Paragraph 7 contends:
As a matter of true innuendo to persons with knowledge of the matters referred to in paragraph 6, the First Publication meant and was understood to mean that the plaintiff had committed an offence by breaching section 206B(3) of the Corporations Act by managing a company while an undischarged bankrupt.
Particulars to par 7 invoke further words surrounding the extracted words from this publication which say this:
Introducing Dodgy's Missus's Xmas gift. Yes from typist to law firm partner in one bound. Perhaps a new name now Dodgy de facto Director is running the show from his home/office. [The extract continued in the second column from the left on page 0007 of Annexure A.] May I suggest: GET‑AWAY‑LAWYERS … MAY BE MORE APPROPRIATE.
It is convenient to resolve now both these as contended legal innuendo meanings. No evidence emerged at the trials of any person reading the first publication (Annexure A) holding particular knowledge of the content of s 206B(3) of the Corporations Act, as regards the prohibition against management participation in corporations by disqualified persons. In other words, the extrinsic facts that are relied upon to make good to additional nuances concerning the words by persons with knowledge of such matters, was wholly absent at the trials. The more obscure reference to words concerning a Christmas gift, and presumably to Mr Douglas' wife, appear to concern her, more so than Mr Douglas. Gratuitously offensive and insulting as those statements present, they do not seem to me to be capable of conveying the precise defamatory meanings that are contended for, either under par 6 or par 7 of Mr Douglas' statement of claim, against him. The absence of any third party witness indicating that they had read the content of Annexure A (the first publication) whilst holding that level of extra knowledge as is contended for is, in the end, fatal to proving these defamatory meanings from out of the first publication.
Consequently then, the grievances raised as regards the first publication (Annexure A) being defamatory of Mr Douglas at any level cannot be accepted.
CIV 2307 of 2012: Mr Billis' action against Mr McLernon
The most recent iteration of Mr Billis' statement of claim was filed on 25 November 2013 (exhibit 14). Its structure is very similar to the statement of claim filed by Mr Douglas in CIV 1930 of 2012 against Mr McLernon.
Once again, it is complained that Mr McLernon is the author of defamatory material published concerning Mr Billis and over the same three websites, namely: and (ie the McLernon File Website).
However, the material complained about by Mr Billis is wholly unique, giving rise to his contentions that he was defamed under a series of eight different internet publications ‑ all alleged to have been authored, then caused to be uploaded to those websites, by Mr McLernon, in the period between 13 January 2012 and 18 September 2012 (until those three websites were shut down, on or around 18 September 2012: see par 7 of Mr Billis' statement of claim).
Again, no issue over Mr Billis' personal identification in these materials arises in respect of the eight internet publications. He is expressly named in all but two of the eight publications (namely the fourth and fifth). For those two publications where he is not expressly named, he is nevertheless identifiable, from surrounding references to the 'Fat Wallet Mob' (that is referred to in Annexure B as being 'headed by Anthony Billis') and by a picture of a rat, with Mr Billis having been earlier referred to as a rodent in Annexure A.
By par 10 of his statement of claim, Mr Billis complains that the first internet publication (a hard copy of which has been downloaded and is attached to his statement of claim as Annexure A, having been viewed by Mr Magee in July 2012) carried five distinct natural and ordinary (defamatory) meanings (false innuendos) against him. The false meanings complained of by Mr Billis were to the effect that Mr Billis in this material is said to:
a.use false email addresses and fax numbers and to register false corporate entities to mask his identity and to attack wives and children of business competitors through those media;
b.be like a rodent in that he is devious, untrustworthy and morally bankrupt;
c.have committed illegal acts and acted in breach of his duties as a director which warranted shareholders of a named corporation to take action against him;
d.have been convicted of perjury; and
e.be unable to speak English as he did not complete schooling in New Zealand.
Each of the above meanings, if they are ascertained by me to arise as a natural and ordinary meaning of the first publication, would be defamatory of Mr Billis, in terms of impacting adversely against his character and reputation. The essential question then is whether or not all those meanings do arise.
In short, I am satisfied that they all do arise. Once again, I do not wish to perpetuate the scope of the publication of this material by unnecessarily recording and preserving it within these reasons.
The second publication complained of by Mr Billis (Annexure B) is alleged to carry the meaning that he is the head of an organised crime gang called the 'Fat Wallet Mob' (par 13 of the statement of claim). First, I am satisfied that that meaning does arise from the express words used within that publication. Second and self‑evidently, that pejorative meaning is defamatory of Mr Billis' reputation. Again, the only real contest at the trial was whether Mr McLernon was the author in the legal publication sense of that material. I will address that contested question separately and globally in due course.
The third publication complained of by Mr Billis (Annexure C) is said to carry two natural and ordinary meanings defamatory of Mr Billis (see par 16 of the statement of claim). These false innuendo meanings are that Mr Billis:
a.committed perjury whilst being interviewed by ASIC; and
b.makes threats to honest people.
I am satisfied that both meanings do arise. Self‑evidently again, they are meanings that damage the character and reputation of Mr Billis. Essentially then, Mr Billis has been defamed, subject to establishing that Mr McLernon is the author of the words complained of as they appeared and were viewed over the three internet websites.
The fourth publication complained of (Annexure D) is asserted by Mr Billis to carry three separate false innuendo meanings defamatory of his character or reputation (par 19 of the statement of claim). These are to the effect that Mr Billis:
a)is the head of a criminal gang called the 'Fat Wallet Mob';
b)has threatened women and children with violence by other members of that same criminal gang; and
c)is being investigated by police and has been warned by police not to threaten women and children with violence by other members of that criminal gang.
First, I need to be satisfied that those imputations are established as natural and ordinary meanings of the words complained of under this publication. Again, I am satisfied that these meanings are shown to arise. Self‑evidently again, they are defamatory meanings. By their seriously pejorative nature they can be seen to be damaging to Mr Billis' character and reputation in the community.
The fifth publication complained of (Annexure E) is alleged to carry two false innuendo meanings against Mr Billis (par 22 of the statement of claim). These are that he had, acting with a criminal gang called the Fat Wallet Mob:
a)firebombed Mr McLernon's house; and
b)incinerated Mr McLernon's car using some sort of 'Molotov cocktail'.
I am satisfied that those meanings do arise from the text of the material complained about as the fifth publication. Again, self‑evidently they are meanings seriously defamatory of Mr Billis' reputation, by their very nature raising as they do acts of criminal misconduct by him.
The sixth publication complained of (Annexure F) is said to carry only one false innuendo defamatory meaning against Mr Billis ‑ namely that he is a 'dangerous man who wears a silver pistol on his person which he uses as a weapon when he has arguments with people' (par 25 of the statement of claim).
I am again satisfied that this meaning arises from the words of the sixth publication, which expressly identifies Mr Billis and a silver pistol, with Mr Billis said to be engaging in conduct by the term 'battered', which is used in reference to McLernon, a cameraman and Mr McLernon's car.
The seventh publication complained of by Mr Billis (Annexure G) is contended to carry two defamatory imputations arising upon the natural and ordinary meaning of the words used (par 28 of the statement of claim). The two meanings are that Mr Billis is:
a)a gangster who is part of a criminal gang called the 'Fat Wallet Mob'; and
b)a dangerous man who is to be feared because he carries a silver pistol on his person, a baseball bat in his car, has four pistols in his office safe and many high powered rifles, all intended to be used for criminal purposes.
I am satisfied that those two meanings do arise on the words of the seventh publication. Self‑evidently they have, yet again, meanings which of their very nature are defamatory of Mr Billis' reputation and character.
The final (eighth) publication that is complained of by Mr Billis (Annexure H) is said to carry three defamatory false innuendo meanings adverse to him (par 31 of the statement of claim). These are that Mr Billis has:
a)illegally appropriated company funds for his own use;
b)illegally transferred money from companies of which he is a director overseas, so that shareholders in the company do not receive dividends; and
c)a long criminal record, which warrants him being gaoled if he is convicted of using company funds to fund a personal matter.
I am satisfied that these meanings do arise from the material which is complained of as the eighth publication. Again, and self‑evidently, they are seriously defamatory of Mr Billis' character and reputation.
In conclusion, the necessary fundamentals have been proved in respect of proving that these eight internet publications were all seriously defamatory of Mr Billis. A residual evaluation arises and is necessary only upon the contested factual issue over whether Mr McLernon was in fact the author and publisher of all these materials carried upon the three websites.
CIV 2308 of 2012: Mr Matich's action against Mr McLernon
The most contemporary iteration of the statement of claim used for this action (after some interlocutory adjustment) was filed on 25 November 2013 (exhibit 23). Mr Matich complains about material concerning him published over the internet upon the samethree earlier as identified websites ( and and in aggregate referred to at par 2b of his statement of claim as the 'the McLernon File Website'.
The structure of this pleading is once again similar to that of the pleadings filed by Mr Douglas and Mr Billis, attaching four allegedly defamatory publications as Annexures A to D. Each is separately complained about, as having been the subject of the publication of defamatory material between 4 August 2011 and 18 September 2012 (pars 7 and 8 of the statement of claim read in combination). Again, it is pleaded that the McLernon File Website (as defined in aggregate) was eventually shut down.
The first of the publications complained of (see par 8 of the statement of claim, referring to Annexure A) identifies three false innuendo meanings complained about by Mr Matich, under par 10 of his pleading. The imputations complained of respectively are that Mr Matich:
a)is not a fit and proper person to be a director of a listed public company;
b)associates with a named notorious police officer; and
c)has paid the notorious person identified (referring to Mr Oliver Douglas, using a prefix slang name, 'Dodgy') to threaten and harass the families of business rivals using the internet.
The words complained of as the subject matter of the first publication expressly identify Mr Paul Matich by his name. His identification as the object of the matter complained of is therefore not in any doubt.
In respect of other publications, Mr Matich is identified either expressly as 'Paul', or as 'Noddy' Matich. His identification is therefore proved.
I am next satisfied that each of the three meanings complained about by Mr Matich, does arise on the natural and ordinary meanings of this material. Moreover, and almost self‑evidently, I must assess such meanings as being inherently damaging to the reputation and character of Mr Matich.
Consequently, this publication meets the relevant requirements to be assessed as a defamatory publication, thereby establishing the cause of action in defamation by Mr Matich against Mr McLernon. That will be so if - as once again presents as being the only real issue in serious controversy - Mr McLernon is proven to be the author and publisher of this material found across the three websites.
I would reiterate that it has been proven that all this internet material was, on my assessment, downloaded and read in Western Australia by at least one independent adult third person - namely by Mr Magee. Therefore, it has been proved as having been published in the relevant legal sense, from the perspective of establishing an efficacious cause of action under the tort of defamation.
The second publication complained of by Mr Matich (identified at par 11 of his statement of claim referring to Annexure B) is said to carry, by its natural and ordinary meaning, two false innuendo meanings against him. The first is that Mr Matich is not a fit and proper person to be a director of a named and identified corporation. Second, it is said to carry the meaning that Mr Matich has abused power entrusted to him in his role as a director by casting votes in accordance with instructions from a family member and not acting independently in the interests of a company.
I am satisfied that both these meanings do arise from the words complained of. I am also satisfied that self‑evidently they are meanings that are, by their very nature, damaging to the character and reputation of Mr Matich. Consequently, they are defamatory of him in the relevant sense.
The third publication complained of (identified in par 14 of Mr Matich's statement of claim) refers to Annexure C. Annexure C is said to be a hard copy of what was downloaded from the relevant website. Only one false innuendo meaning is contended for under par 16 of the statement of claim, namely that the words complained of mean that Mr Matich 'is being investigated by the Australian Securities and Investments Commission': see par 16(a) of the statement of claim.
Having examined the words complained of, I am not satisfied that this particular imputation has been established, in terms of a natural and ordinary meaning of the words, when read by the hypothetical ordinary and reasonable reader who is not avid for scandal. Rather, the incoherent sentences comprising this material would seem to suggest only an inference to the effect that the author of the website is advocating that ASIC should investigate Mr Matich, rather than suggesting the fact of a subsisting investigation being undertaken by ASIC (see the word 'is' in that contended imputation, which is not supported by the text).
Towards that assessment, I refer generally to the observations of Lord Devlin in Lewis v Daily Telegraph Ltd [1964] AC 234, upon the effect of the words at issue in that case that the City of London fraud squad 'are enquiring into the affairs of Rubber Improvement Ltd'. A legal distinction by Lord Devlin in the House of Lords was there drawn, as between a statement that a plaintiff's affairs were being enquired into, in contrast to a statement that implied there were good grounds for inquiry or grounds for suspicion: see Lewis v Daily Telegraph (282, 285).
By my assessment of the third publication, applying the ordinary reasonable reader template criteria, the imputation contended for (ie that Mr Matich is being investigated by ASIC) simply does not arise. A distinct imputation which I would assess as being discernible, namely that there are grounds to investigate Mr Matich, would be defamatory. It is a meaning that would, I think, be extractable from this same material applying the same template criteria. However, that rival meaning is not pleaded. It is not the precise imputation invoked here by Mr Matich. Since Mr McLernon acts in person he could be prejudiced by an amendment to pick up that rival meaning in lieu of the meaning that fails. I am troubled over allowing Mr Matich to proceed in respect of that different imputation.
In the circumstances I must reject the imputation contended for under par 16(a) as not arising. Consequently, I do not find a cause of action established based upon the third publication complained of by Mr Matich. See generally as well my observations concerning what is sometimes referred to as a Chase Level 3 investigation imputation, in Shea v News Ltd [2015] WASC 1.
The fourth internet publication complained of by Mr Matich is referred to by par 17 of Mr Matich's statement of claim ‑ again by reference to an attached hardcopy printout of what appears on the internet (Annexure D).
Mr Matich contends that three false innuendo imputations arise from that material, upon the natural and ordinary meanings of the published words: see par 19 of the statement of claim.
The imputations complained of are, in effect, that Mr Matich:
a)'stole everything that [a Mr G], who was a close friend of [Mr Matich], owned';
b)is not a fit and proper person to be a director of a corporation because Mr Matich attends board meetings by telephone from a bar in Thailand; and
c)is not a fit and proper person to be a director of a company, because he is likely to betray other board members.
I am not persuaded that the imputation under par 19(a), as regards Mr Matich having stolen everything that Mr G once owned, is capable of being extracted from the words complained of in their natural and ordinary meaning, by an ordinary and reasonable reader of those words. The relevant word used within the overall text is the word 'stripped', used in a context of the phrase, 'of all his worldly goods'. Whilst something else pejorative may be capable of being made out of those words complained of, I do assess a real conceptual difficulty in accepting the meaning of 'stole everything', measured against a lesser (in terms of gravity) terminology of text, 'stripped [Mr G] of all his worldly goods'. Albeit I am now applying the lesser assessment standards of the hypothetical ordinary reasonable reader, I am not in the end left persuaded here that this high level criminality meaning, as is contended for, can be found to arise.
Nevertheless, I am satisfied that the imputation under par 19(b) - that Mr Matich is not a fit and proper person to be a director - does arise, particularly by reference to the 'bar in Thailand' text. In effect, that same imputation is raised under par 19(c), albeit now with further words added to the tail of this imputation, concerning a betrayal of other board members. A casual reader could interpret the words complained of that way, particularly by reference to the text concerning Mr Matich needing to sit in a position 'where John can see him not behind Johns [sic] back'. I assess that to be a reasonable interpretation of those somewhat cryptic words, which are well capable of carrying the meaning for the ordinary person that Mr Matich is likely to betray a fellow board member.
Furthermore, I would also conclude that the fourth publication does carry the defamatory meaning concerning Mr Matich's unfitness to be a director. Such a meaning is defamatory of the character and professional reputation of Mr Matich, for the purpose of establishing a cause of action in defamation against Mr McLernon upon this publication ‑ with the abiding qualification, as for all matters complained of, that Mr McLernon is proven to be responsible for the material found on the websites.
Responsibility: Mr McLernon
I can now soon begin to address what presents as the only significant, contested factual issue arising in the three trials concerning Mr McLernon. This is the issue about Mr McLernon's disputed authorship and publication - in the sense of causing all the materials complained of by each plaintiff to be uploaded and placed upon the three identified websites. That is the only major residual area of contested factual disputation in need of resolution. As I proceed to explain in a separate section later in these reasons, I have been satisfied that these claims against Mr McLernon have been made out.
I have already rejected at the trial Mr McLernon's no case submission made in Mr Matich's action CIV 2308 of 2012: see ts 678 ‑ 679.
Summary of position in respect of the three defamation actions against Mr McLernon
As set out above, each of the plaintiffs through their affidavits tendered at trial have spoken at length about their personal distress and concern in relation to the materials they complain of.
Given a long history of the plaintiffs' grievances concerning Mr McLernon and his internet publications, the plaintiffs' affidavits contain on occasions material that is either not pertinent to the matters complained of, or that serves only as background towards their frustrations arising from other internet publications by (they allege) Mr McLernon. Some of these previous encounters extend back to as early as 2003 ‑ 2004. I have paid no regard to that earlier material other than by way of a historic lead in to the publications substantively complained about in these actions.
In the case of Mr Douglas' defamation action against Mr McLernon (CIV 1930 of 2012), his writ was issued on 25 May 2012. Essentially, I am concerned with defamatory publications about Mr Douglas, attributed to Mr McLernon as author and uploader of the materials to the three websites in question, in a twelve month period prior to the issue of that writ, ie from (at or about) the end of May 2011, through to May 2012.
In the case of the other plaintiffs, Messrs Billis and Matich filed their defamation writs against Mr McLernon (respectively CIV 2307 and 2308 of 2012) on 1 August 2012.
Again, Mr Billis' affidavit (exhibit 19) and Mr Matich's affidavit (exhibit 28) detail a significant amount of other material concerning their defamation grievances against Mr McLernon in earlier periods. That is historic background information only at best. Again, I have given it no weight. Substantively, from a defamation liability perspective in these proceedings, I am concerned with internet publications over the three websites that are attributed to Mr McLernon in the 12 month period prior to 1 August 2012.
I have now dealt with the publications that each plaintiff has complained about vis-à-vis Mr McLernon. I will reiterate by reference to the terms of s 8 of the Defamation Act that it is the defamatory publication which provides a cause of action in defamation, not the possible multiple distinct defamatory meanings which can be identified within any one particular publication.
Degree of publication: Mr Douglas
By way of a brief summary I have essentially concluded that Mr Douglas has now established that he has been defamed under three of the four internet publications about which he complains. Each of the second, third and fourth publications he complains about contain a multitude of defamatory meanings all adversely impacting Mr Douglas' character and reputation. The adverse meanings complained about are serious, pejorative and are clearly defamatory of Mr Douglas' reputation.
A scope for multiple persons in the community to have seen such defamatory materials (from the perspective of a potential assessment of damages) about Mr Douglas is supported first by the evidence from Mr Magee that he personally downloaded and read all the material. Consequently, proof of publication to a third party in the legal sense, as discussed in Dow Jones, is established here. But from an overall damages perspective, what remains to be determined is the degree of exposure of this material to the community in terms of these particular second, third and fourth publications as complained of by Mr Douglas (and see s 34 of the Defamation Act).
As to that degree issue, I am satisfied that the extent of circulation of this material (being downloaded on the internet and read by persons in Western Australia) is, on the balance of probabilities, likely to be a lot broader than just an exposure to Mr Magee. Noting that Mr McLernon did not cross‑examine Mr Douglas and therefore no challenge was made to what was admitted to evidence as Mr Douglas' affidavits which contained his evidence‑in‑chief (exhibits 4 and 9, respectively), I would observe upon what Mr Douglas says, unchallenged, particularly at pars 37, 59, 60, 115, 118, 119 and 121. In further viva voce evidence given at the trial, Mr Douglas expanded upon the consequences of him conducting a Google search in relation to his own name, with the result of that Google search taking a person conducting the search to the three websites at issue, being where the materials complained of by him are found (see ts 405).
The paragraphs which I have identified in Mr Douglas' affidavit indicate his evidence about third persons, in terms of their reactions to Mr Douglas. He relates, in effect, that such persons have conducted themselves in ways with him which would indicate to him, that they have seen the material complained about as the second, third and fourth publications and that, following those reactions, Mr Douglas learnt about the impacts of the material. For instance, Mr Douglas relates the distress he suffered in relation to his membership of and participation in events of the Perth Flying Squadron Yacht Club. Specifically, Mr Douglas says that as a result of the material complained about, he was not nominated for a board position and then, in the aftermath, the embarrassment he suffered caused him to resign and not participate further with that organisation.
I am satisfied that the internet material complained about under the second, third and fourth publications about Mr Douglas would have been exposed to a reasonably wide section of the internet‑using general public of Western Australia and to a reasonably wide degree, which has then adversely impacted against Mr Douglas' perceived reputation in that community. Moreover, I would assess his distress in relation to the impact of that material upon persons with whom he associates as being both genuine and significant. Those considerations should be reflected in the award of damages in his favour.
Degree of publication: Mr Billis
As now set out above, Mr Billis complains about eight internet publications over the three websites at issue.
Subject to the contested responsibility issue regarding Mr McLernon, I concluded that Mr Billis has been defamed under each of those eight internet publications he complains about. The respective meanings which I have canvassed and found to be established under that material does mostly carry strongly adverse, pejorative statements about his character and reputation. Merely to peruse the various meanings which I have now found to be carried, is to display their seriously adverse characteristics conveyed against Mr Billis.
The breadth of circulation of that material amongst the Western Australian community, in terms of it being accessed and read from the internet over a 12 month period prior to 1 August 2012, leads me generally to Mr Billis' affidavit (exhibit 19) and to what is said there concerning the results of a Google search of his name ‑ producing links to the websites in question (see par 63). I also note what Mr Billis has said under pars 69, 71, 72 and 73 of his affidavit concerning his own perceptions as to the impacts of this circulating material upon members of the community with whom he dealt and how this has consequently affected him. I accept this evidence. I conclude as I did in respect of Mr Douglas that the spread of this material under the eight publications complained about is likely to have been widespread and to have impacted adversely against Mr Billis' reputation and particularly in the West Australian business community.
I also accept that this has all been very distressing for Mr Billis and that these are again considerations which should bear upon the award of damages to Mr Billis, if made. I also note that Mr Billis entered the witness box to confirm the content of his affidavit and made himself available for cross‑examination by Mr McLernon. Mr McLernon declined the opportunity he then held to cross‑examine Mr Billis: see ts 659 ‑ 660.
I also note that both Mr Douglas and Mr Billis in their affidavits go further, to complain about subsequent publications by Mr McLernon on social media such as Facebook and Twitter. They relate steps they have taken to address their concerns in that respect. They also refer to the publication of further defamatory matter, which they complain about, published over another website, TerenceMcLernon.com.au.
Publications over Facebook and Twitter and upon the latter website are not the direct subject matter of the present proceedings ‑ in terms of being defamatory publications complained about that themselves give rise to a potential award of compensatory damages. However, they are events nonetheless being less directly relevant, in the context of being potential aggravations of damage in respect of the primary publications complained of. Even more significantly, however, as events going to the likelihood of a serious risk of future repetition of more publications of a like nature, they do bear upon the plaintiffs' claim for permanent injunctive relief against Mr McLernon which all plaintiffs seek against Mr McLernon, above and beyond any damages awarded to them. Indeed, bearing in mind the ostensible impecuniosity of Mr McLernon, the plaintiffs' pursuit of remedy by way of permanent injunctions restraining Mr McLernon from causing or bringing about any further internet publications of a similar character, under threat of a contempt sanction, would present as perhaps the most effective tangible remedy sought by these plaintiffs from their actions against Mr McLernon.
Degree of publication: Mr Matich
All the same considerations apply in relation to Mr Matich. Mr Matich attended trial and confirmed the content of his affidavit which became exhibit 28. Once again, Mr McLernon declined his opportunity at trial to ask any questions of Mr Matich in cross‑examination: see ts 675.
As I have already discussed, there were four publications complained about by Mr Matich. I found three of the four publications (the first, second and fourth) to be defamatory of him in terms of his character and reputation.
By way of general contrast as between Mr Matich and the scope and scale of the defamatory publications against Mr Douglas and Mr Billis, it is apparent to me that the scale of and seriousness of the imputations against Mr Matich are not of the same magnitude (numerically) or seriousness as those seen put as against the other two plaintiffs, which carry more grave charges against the reputations and characters of these two men.
That observation is not intended to diminish the harm or hurt carried by what has been published concerning Mr Matich. It is only to observe that in contrast to Mr Douglas and Mr Billis as plaintiffs, Mr Matich appears to have been something of a lesser target ‑ albeit what was said about him, particularly under the fourth publication complained about in terms of his unfitness to be a director of a corporation, concerning his character and professional reputation, carries the capacity to inflict economic harm - something about which Mr Matich complains generally in his evidence in terms of his difficulty finding work.
I refer generally to pars 20, 56, 62 and 70 in Mr Matich's affidavit concerning perceptions he held about his interactions with persons in Western Australia who he assessed as having been exposed to the internet matters complained about and rendering upon Mr Matich adverse effects, and Mr Matich's concern and distress which he felt as a result. I accept that evidence. These are considerations which bear upon the level of an award of damages, if made against Mr McLernon.
Likewise, Mr Matich's affidavit speaks more generally about other internet material of concern to him issuing from Mr McLernon ‑ but temporally only after the particular publications complained about. Those matters raise issues relevant to potential aggravation of damages and to Mr Matich's claim for relief by way of permanent injunction against Mr McLernon, bearing in mind what presents to be the ongoing continuance of defamatory publications issuing against Mr Matich, and which he attributes to Mr McLernon.
Key contested issue: the authorship and publication of the internet materials complained of as against Mr McLernon (first defendant in CIV 1930 of 2012, CIV 2307 of 2012 and CIV 2308 of 2012)
Mr McLernon has acted for himself without legal representation in all three defamation actions concerning him since the actions were variously commenced in May and then August 2012. Currently, as filed, his three defence pleadings in each of the actions against him (CIV 1930, 2307 and 2308 of 2012) each manifest only three paragraphs of content, ostensibly carrying his signature at the end.
On the court file for each of the three actions there is to be found a document entitled 'Amended Pleading of Defendant' showing the date 22 April 2016, and carrying at the bottom a signature seen above a straight line, under which appears the words 'Terence John McLernon, First Defendant', then, adjacent to that, the words 'Page 1 of 1'.
Copies of these three amended defence documents were received as exhibits at the trial, in somewhat unusual circumstances. They were received in CIV 1930, 2307 and 2308 of 2012 as exhibit 3, exhibit 18 and exhibit 27 respectively (all carry the date 22 April 2016 and a signature above a typed name, 'Terence John McLernon, First Defendant').
Each reads:
AMENDMENT
1.I respectfully submit this Amended Pleading as annulment and replacement of all my previous pleadings in this case, including those in my Statement of Defence.
2.My new pleading regarding the Plaintiff's respective Statements of Claim is that I deny and reject them outright.
3.Accordingly I deny publication or responsibility for publication of the alleged defamatory materials submitted by the Plaintiffs in their Statements of Claim.
As such, I propose to issue permanent injunctions in broadly the following terms (subject to any submissions from the plaintiffs): Mr McLernon be permanently restrained from publishing or continuing to publish any matters conveying the imputations set out below, or any imputations to the same or similar purport and effect, whether on any of the websites complained of or elsewhere.
In Mr Douglas' action, CIV 1930 of 2012, the permanent injunction extends to restrain any publication by Mr McLernon of imputations that Mr Douglas:
a)threatens innocent women and children using internet sites;
b)knowingly associates with a notorious corrupt police officer;
c)has been convicted of a series of criminal offences in Queensland;
d)has stolen $500,000 from a corporation of which he was a director and been found guilty by a court of that offence;
e)has stopped ASIC officers from investigating him by obstructing, terrorising or intimidating those officers;
f)has set up large numbers of companies for the sole purpose of avoiding paying creditors;
g)has fraudulently obtained millions of dollars by false loan applications;
h)is a member of an organised crime gang (known as the 'Fat Wallet Mob');
i)has been charged with civil and criminal offences in three different states;
j)committed fraud whilst working as the treasurer of a named corporation;
k)worked with a well-known deceased Perth businessman to commit fraud and perpetrate a financial scam;
l)stole $400,000 from a named Malaysian politician;
m)is known by the general public to be a distributor of pornographic, degrading and immoral materials, using unregistered websites and the internet;
n)operates internet sites which distribute and make available pornography;
o)was found by a judge of the Court of Appeal to be dishonest and a judgment was handed down to this effect;
p)has been paid to post false accusations about the sexuality of business competitors on internet sites for the purpose of blackmailing them;
q)regularly posted pornography and other immoral materials involving women and children on the internet using Facebook, Twitter and emails;
r)is likely to physically harm women and people who are infirm;
s)is mentally unstable and needs to be committed to a mental institution because he is dangerous to others, in particular to women and the infirm; and
t)bears responsibility for a certain notorious former police officer in Western Australia committing suicide (by hanging himself).
In Mr Billis' action, CIV 2307 of 2012, the permanent injunction extends to restrain any publication by Mr McLernon of imputations that Mr Billis:
a)uses false email addresses, fax numbers and registers, false corporate entities to mask his identity and attack wives and children of business competitors through those media;
b)is like a rodent in that he is devious, untrustworthy and morally bankrupt;
c)has committed illegal acts and acted in breach of his duties as a director which warranted shareholders of a named corporation to take action against him.
d)has been convicted of perjury;
e)cannot speak English as he did not complete schooling in New Zealand;
f)is the head of an organised crime gang called the Fat Wallet Mob;
g)committed perjury whilst being interviewed by ASIC;
h)makes threats to honest people;
i)is the head of a crime gang called the Fat Wallet Mob;
j)has threatened women and children with violence by other members of that same criminal gang;
k)is being investigated by police and has been warned by police not to threaten women and children with violence by other members of that criminal gang;
l)acting with a criminal gang called the Fat Wallet Mob, firebombed Mr McLernon's house;
m)acting with the same criminal gang, incinerated Mr McLernon's car using some sort of 'Molotov cocktail';
n)is a 'dangerous man who wears a silver pistol on his person which he uses as a weapon and he has arguments with people';
o)is a gangster who is part of a criminal gang named as the Fat Wallet Mob;
p)is a dangerous man who is to be feared because he carries a silver pistol on his person, baseball bat in his car, has four pistols in his office safe and many high powered rifles all intended to be used for criminal purposes;
q)illegally appropriated company funds for his own use;
r)has illegally transferred money from companies of which he is a director overseas, so that shareholders in the company do not receive dividends; and
s)has a long criminal record which warrants him being jailed, if he is convicted of using company funds to fund a personal matter.
For Mr Matich in CIV 2308 of 2012, the permanent injunction extends to restrain any publication by Mr McLernon of imputations that Mr Matich:
a)is not a fit and proper person to be a director of a listed public company;
b)associates with a named notorious police officer;
c)has paid the notorious person identified (referring to Mr Oliver Douglas with the prefix slang name 'Dodgy') to threaten and harass the families of business rivals using the internet;
d)is not a fit and proper person to be a director of a named and identified corporation;
e)has abused power entrusted to him in his role as a director by casting votes in accordance with instructions from a family member and not acting independently in the interests of a company;
f)is not a fit and proper person to be a director of a corporation because Mr Matich attends board meetings by telephone from a bar in Thailand; and
g)is not a fit and proper person to be a director of a company, because he is likely to betray other board members.
Conclusions
As successful parties, the plaintiffs should receive their costs of the trials against Mr McLernon. Prima facie, as discussed these costs should be on an indemnity basis.
The plaintiffs should provide a minute of orders for each action giving effect to these reasons within seven days of their publication, except as otherwise indicated below.
The actions against Mr Fitzgerald, as discussed, are dismissed.
Orders
In light of these reasons, the following orders should issue, prima facie, in respect of the four defamation actions by Messrs Douglas, Billis and Matich.
A. CIV 1930 of 2012:
1)The plaintiff (Mr Douglas) is awarded $250,000 damages plus simple interest thereon at 3% per annum calculated from 18 September 2012, against the defendant (Mr McLernon);
2)A permanent injunction shall issue restraining the defendant (Mr McLernon) from making, or continuing to make, or causing to be made, any future publications containing any imputations that, or to the effect that, Mr Douglas:
a)threatens innocent women and children using internet sites;
b)knowingly associates with a notorious corrupt police officer;
c)has been convicted of a series of criminal offences in Queensland;
d)has stolen $500,000 from a corporation of which he was a director and has been found guilty by a court of that offence;
e)has stopped ASIC officers from investigating him by obstructing, terrorising or intimidating those officers;
f)has set up large numbers of companies for the sole purpose of avoiding paying creditors;
g)has fraudulently obtained millions of dollars by false loan applications;
h)is a member of an organised crime gang (known as the 'Fat Wallet Mob');
i)has been charged with civil and criminal offences in three different states;
j)committed fraud whilst working as the treasurer of a named corporation;
k)worked with a well-known deceased Perth businessman to commit fraud and perpetrate a financial scam;
l)stole $400,000 from a named Malaysian politician;
m)is known by the general public to be a distributor of pornographic, degrading and immoral materials, using unregistered websites and the internet;
n)operates internet sites which distribute and make available pornography;
o)has been paid to post false accusations about the sexuality of business competitors on internet sites for the purpose of blackmailing them;
p)was found by a judge of the Court of Appeal to be dishonest and a judgment was handed down to that effect;
q)regularly posted pornography and other immoral materials involving women and children on the internet using Facebook, Twitter and emails;
r)is likely to physically harm women and people who are infirm;
s)is mentally unstable and needs to be committed to a mental institution because he is dangerous to others, in particular to women and the infirm; and
t)bears responsibility for a certain notorious former police officer in Western Australia committing suicide (by hanging himself).
3)The defendant is to pay the plaintiff's costs of this action to be taxed on an indemnity basis so that the plaintiff is fully indemnified for his costs, except insofar as the costs may have been unreasonably incurred or are unreasonable in amount.
B. CIV 2306 of 2012:
1)As ordered on 22 June 2016, the plaintiff's (Mr Douglas') action against the third defendant (Ms Toni Fitzgerald) is dismissed;
2)The plaintiff's (Mr Douglas') action against the fourth defendant (Mr Laurence Fitzgerald) is dismissed;
3)No orders are made as to the costs of this action.
C. CIV 2307 of 2012:
1)The plaintiff (Mr Billis) is awarded $250,000 damages plus simple interest thereon at 3% per annum calculated from 18 September 2012, against the first defendant (Mr McLernon);
2)A permanent injunction shall issue restraining the first defendant (Mr McLernon) from making, or continuing to make, or causing to be made, any future publications containing any imputations that, or to the effect that, Mr Billis:
a)uses false email addresses and fax numbers and registers false corporate entities to mask his identity and attack wives and children of business competitors through those media;
b)is like a rodent in that he is devious, untrustworthy and morally bankrupt;
c)has committed illegal acts and acted in breach of his duties as a director which warranted shareholders of a named corporation to take action against him.
d)has been convicted of perjury;
e)cannot speak English as he did not complete schooling in New Zealand;
f)is the head of an organised crime gang called the Fat Wallet Mob;
g)committed perjury whilst being interviewed by ASIC;
h)makes threats to honest people;
i)is the head of a crime gang called the Fat Wallet Mob;
j)has threatened women and children with violence by other members of that same criminal gang;
k)is being investigated by police and has been warned by police not to threaten women and children with violence by other members of that criminal gang;
l)acting with a criminal gang called the Fat Wallet Mob, firebombed Mr McLernon's house;
m)acting with the same criminal gang, incinerated Mr McLernon's car using some sort of 'Molotov cocktail';
n)is a 'dangerous man who wears a silver pistol on his person which he uses as a weapon and he has arguments with people';
o)is a gangster who is part of a criminal gang named as the Fat Wallet Mob;
p)is a dangerous man who is to be feared because he carries a silver pistol on his person, baseball bat in his car, has four pistols in his office safe and many high powered rifles all intended to be used for criminal purposes;
q)illegally appropriated company funds for his own use;
r)has illegally transferred money from companies of which he is a director overseas, so that shareholders in the company do not receive dividends; and
s)has a long criminal record which warrants him being jailed, if he is convicted of using company funds to fund a personal matter.
3)As ordered on 22 June 2016, the plaintiff's (Mr Billis') action against the fourth defendant (Ms Toni Fitzgerald) is dismissed;
4)The plaintiff's action against the fifth defendant (Mr Laurence Fitzgerald) is dismissed;
5)The first defendant is to pay the plaintiff's costs of this action to be taxed on an indemnity basis so that the plaintiff is fully indemnified for his costs, except insofar as the costs may have been unreasonably incurred or are unreasonable in amount
6)No orders as to costs as regards the fourth and fifth defendants.
D. CIV 2308 of 2012:
1)The plaintiff (Mr Matich) is awarded $200,000 damages plus simple interest thereon at 3% per annum calculated from 18 September 2012, against the first defendant (Mr McLernon);
2)A permanent injunction shall issue restraining the first defendant (Mr McLernon) from making, or continuing to make, or causing to be made, any future publications containing any imputations that, or to the effect that, Mr Matich:
a)is not a fit and proper person to be a director of a listed public company;
b)associates with a named notorious police officer;
c)has paid the notorious person identified (referring to Mr Oliver Douglas with the prefix slang name 'Dodgy') to threaten and harass the families of business rivals using the internet;
d)is not a fit and proper person to be a director of a named and identified corporation;
e)has abused power entrusted to him in his role as a director by casting votes in accordance with instructions from a family member and not acting independently in the interests of a company;
f)is not a fit and proper person to be a director of a corporation because Mr Matich attends board meetings by telephone from a bar in Thailand; and
g)is not a fit and proper person to be a director of a company, because he is likely to betray other board members.
3)As ordered on 22 June 2016, the plaintiff's (Mr Matich's) action against the fourth defendant (Ms Toni Fitzgerald) is dismissed;
4)The plaintiff's action against the fifth defendant (Mr Laurence Fitzgerald) is dismissed;
5)The first defendant is to pay the plaintiff's costs of this action to be taxed on an indemnity basis so that the plaintiff is fully indemnified for his costs, except insofar as the costs may have been unreasonably incurred or are unreasonable in amount.
6)No orders as to costs as regards the fourth and fifth defendants.
Postscript regarding the Fitzgeralds' costs circumstances
The Fitzgeralds have acted in person at all material times from 4 September 2012. I will allow a period of seven days following publication of these reasons, in which time Ms Fitzgerald and Mr Fitzgerald have leave to make written submissions within that time as to costs orders. The plaintiffs are afforded a further seven days to respond in that event. In the absence of any written submissions from them, any prima facie orders as to costs and disbursements as seen above will issue.
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: DOUGLAS -v- McLERNON [No 4] [2016] WASC 320 (S)
CORAM: KENNETH MARTIN J
HEARD: ON THE PAPERS
DELIVERED : 21 DECEMBER 2016
FILE NO/S: CIV 1930 of 2012
BETWEEN: OLIVER GEORGE DOUGLAS
Plaintiff
AND
TERENCE JOHN McLERNON
Defendant
FILE NO/S :CIV 2306 of 2012
BETWEEN :OLIVER GEORGE DOUGLAS
Plaintiff
AND
TONI FITZGERALD
Third DefendantLAURENCE KERRY FITZGERALD
Fourth Defendant
FILE NO/S :CIV 2307 of 2012
BETWEEN :ANTHONY BILLIS
Plaintiff
AND
TERENCE JOHN McLERNON
First DefendantTONI FITZGERALD
Fourth DefendantLAURENCE KERRY FITZGERALD
Fifth Defendant
FILE NO/S :CIV 2308 of 2012
BETWEEN :PAUL MATICH
Plaintiff
AND
TERENCE JOHN McLERNON
First DefendantTONI FITZGERALD
Fourth DefendantLAURENCE KERRY FITZGERALD
Fifth Defendant
Catchwords:
Practice and procedure - Costs application - Unrepresented defendant - Case dismissed at trial on the basis of no case to answer - Previous periods of legal representation - Application for costs
Legislation:
Nil
Result:
Orders issued
Category: B
Representation:
CIV 1930 of 2012
Counsel:
Plaintiff: Mr G Mukherji
Defendant: In person
Solicitors:
Plaintiff: Tindall Gask Bentley Lawyers
Defendant: In person
CIV 2306 of 2012
Counsel:
Plaintiff: Mr G Mukherji
Third Defendant : In person
Fourth Defendant : In person
Solicitors:
Plaintiff: Tindall Gask Bentley Lawyers
Third Defendant : In person
Fourth Defendant : In person
CIV 2307 of 2012
Counsel:
Plaintiff: Mr G Mukherji
First Defendant : In person
Fourth Defendant : In person
Fifth Defendant : In person
Solicitors:
Plaintiff: Tindall Gask Bentley Lawyers
First Defendant : In person
Fourth Defendant : In person
Fifth Defendant : In person
CIV 2308 of 2012
Counsel:
Plaintiff: Mr G Mukherji
First Defendant : In person
Fourth Defendant : In person
Fifth Defendant : In person
Solicitors:
Plaintiff: Tindall Gask Bentley Lawyers
First Defendant : In person
Fourth Defendant : In person
Fifth Defendant : In person
Case(s) referred to in judgment(s):
Cachia v Hanes [1994] HCA 14; (1994) 179 CLR 403
Douglas v McLernon [No 3] [2016] WASC 319
Douglas v McLernon [No 4] [2016] WASC 320
Marsh v Baxter [No 2] [2016] WASCA 51
KENNETH MARTIN J: Under [336] of my substantive reasons for decision in relation to the actions CIV 1930 of 2012, CIV 2306 of 2012, CIV 2307 of 2012 and CIV 2308 of 2012, which were heard together at trial in June 2016, Douglas v McLernon [No 4] [2016] WASC 320, I reserved a period of time (subsequently extended) to allow two of the three in person defendants (Ms Toni Fitzgerald and her brother, Mr Laurence Fitzgerald, who were defendants in three of the four actions that were determined) to make written submissions in relation to costs orders, given trial outcomes in their favour.
Mr Laurence Fitzgerald has not made any submission concerning his costs. On that basis, dismissal of the three actions against him has been effected on the basis that there be no orders as to costs concerning him. Those orders will stand.
Ms Toni Fitzgerald has availed herself of the opportunity to file affidavit material seeking an award of costs in her favour in a number of respects as enumerated in her affidavits of 19 and 28 October 2016, then 14 November 2016.
It is apparent that in the filing of this affidavit material Ms Fitzgerald still acts in person, with a consequence that there is something of an imperfect understanding about the nature of the exercise. It will be remembered (see my separate reasons, Douglas v McLernon[No 3] [2016] WASC 319) that I dismissed all three actions brought against Ms Fitzgerald by the plaintiffs on the basis I was not satisfied that the plaintiffs had established a case for her to answer. At that time during the trials she was appearing in person and over a video link from New South Wales.
It now appears by material appended to Ms Fitzgerald's affidavit that she outlaid $192.50 as a disbursement to a corporation, Whygo Pty Ltd, on 22 June 2016 in order to use a video link facility for the purposes of participating in her ultimately successful no case to answer submission at the trials. At other periods as the trials proceeded she and Mr Laurence Fitzgerald were participants by telephone link. In these circumstances, it is appropriate that a disbursement which she has incurred in respect of accessing a video conference facility in New South Wales, which was necessary for her to participate in the trials, should be met by the plaintiffs. Ms Fitzgerald should be reimbursed for that out of pocket disbursement. As I read the written submissions filed on behalf of the plaintiffs (of 26 October 2016 and then 10 November 2016) that disbursement aspect of her application is not opposed by them: see par 23 of the plaintiffs' written submissions of 10 November 2016.
More substantive legal costs claims as are now foreshadowed under Ms Fitzgerald's affidavit material concern the following three payments which she seeks to recoup, namely:
(a)a payment of $1,302.40 to Ms Sue Chrysanthou, a barrister of Blackstone Chambers at Martin Place, Sydney. Ms Fitzgerald appends a copy of that barrister's tax invoice, as sent to a Mr Purcell of O P O'Neill Partners (solicitors of Hunter Street, Sydney). This is invoice 2623 of 3 September 2012. But O P O'Neill Partners do not appear to have ever been solicitors of record for Ms Fitzgerald in those actions. I set out the court's record concerning her period of legal representation in due course;
(b)an amount of $1,122 that was paid to Hotchkin Hanly Lawyers. The claim in respect of these moneys on the face of it would appear to be misconceived. Hotchkin Hanly were at a point solicitors of record for the plaintiffs. What appears to have occurred is that at some earlier point the former case manager, Le Miere J, had issued an adverse interlocutory costs order against Ms Fitzgerald as defendant, favouring each plaintiff. Orders were made against her then in respect of a payment of $374 to each plaintiff (ie, $374 x 3 = $1,122). The interlocutory costs amounts then appear to have been paid to Hotchkin Hanly on Ms Fitzgerald's behalf by a Mr Brownlee, some time thereafter. In those circumstances, a pursuit of a claim in respect of this adverse interlocutory costs order is not a feature that can be disturbed by the later successful trial outcome for Ms Fitzgerald. The underlying interlocutory circumstances surrounding the making of those adverse costs orders by Le Miere J are not entirely clear to me, although there is speculation in the opposing materials filed on the part of the plaintiffs, to the effect that the adverse interlocutory costs order against Ms Fitzgerald issued by Le Miere J following an event of non‑appearance at a scheduled interlocutory hearing. I say no more about that other than the paid amount is not recoverable by reason of the trial outcomes in her favour;
(c)perhaps most substantively, Ms Fitzgerald seeks a costs order in respect of an amount of $15,000 which she says was paid on her behalf to the West Australian law firm CS Legal, a trading name for the corporation 'The Pier Group Pty Ltd'. Materials before the court appended to Mr Joyce's affidavit filed on behalf of the plaintiffs, as attachment SJ 3 (pages 13 - 14 of Mr Joyce's affidavit of 26 October 2016) indicates that CS Legal became solicitors of record for Ms Fitzgerald and Mr Laurence Fitzgerald on 24 February 2014. The court's integrated case management system (ICMS) record show that CS Legal were the solicitors of record for Ms Fitzgerald, only in the period from 24 February 2014 to 20 May 2014. After that they ceased to be solicitors of record. Furthermore, the ICMS records of the court show that at all other times, namely, in the period between 4 September 2012 to the present time, Ms Fitzgerald has been self‑represented in the three actions concerning her - at least as regards the state of the court record.
Evaluation
Various issues are raised by the exchanged materials and rival submissions concerning the account of CS Legal, including as to whether that law firm was acting for Ms Fitzgerald as well as her brother, whether there ever was a settlement of the account, and whether the account was, in fact, met by Ms Fitzgerald. As to the latter point, however, the significant issue would appear to be whether there was a liability for the account which she incurred an exposure to: see the reasons of the Court of Appeal in Marsh v Baxter [No 2] [2016] WASCA 51 as regards legal costs liabilities.
In the presenting circumstances, it is not appropriate I resolve these contested issues concerning Ms Fitzgerald's claimed costs. The appropriate forum for that to occur is on a taxation of costs conducted before a Registrar of this court.
In the circumstances, the appropriate order which will issue to cater for the contingency of Ms Fitzgerald pursuing a claim of taxed costs in respect of an account paid in respect of advice received from barrister Sue Chrysanthou and for the period of legal representation provided just short of three months by CS Legal, is an order allowing her to claim and tax those costs.
Consequently, I would resolve the present application in respect of each of the three actions where Ms Fitzgerald was a participant defendant on a basis that she will receive her taxed legal costs of those actions from the plaintiffs, including any appropriate disbursements she has incurred, on a party‑party basis. Any taxation would necessarily proceed, however, on a basis that by reason of the principle explained in Cachia v Hanes [1994] HCA 14; (1994) 179 CLR 403, such a recoupment on a taxation in respect of legal costs has no application towards periods when a participant party is self‑represented.
Effectively then, the claim for costs by Ms Fitzgerald as foreshadowed concerning the invoice of barrister Sue Chrysanthou and the invoice of CS Legal will fall to be assessed at a taxation.
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