Dow Jones Company Inc v Gutnick

[2001] VSCA 249

SUPREME COURT OF VICTORIA

COURT OF APPEAL

No. 7763 of 2000

DOW JONES & COMPANY INC.
	Applicant
v.
JOSEPH GUTNICK	Respondent

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APPLICATION ON SUMMONS

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JUDGES:	BUCHANAN, J.A. and O'BRYAN, A.J.A.
WHERE HELD:	MELBOURNE
DATE OF HEARING:	14 September 2001
DATE OF JUDGMENT:	21 September 2001
MEDIUM NEUTRAL CITATION:	[2001] VSCA 249

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APPEARANCES:	Counsel	Solicitors
For the Applicant	Mr N. Young, Q.C. with Mr T. Robertson	Gilbert & Tobin
For the Respondent	Mr J. Sher, Q.C. with Mr M. Wheelahan	Schetzer, Brott & Appel

BUCHANAN, J.A.:
O’BRYAN, A.J.A.:

1. The applicant publishes “Barrons Magazine”, a weekly magazine with a substantial circulation in the United States mainly among investors and those interested in financial affairs.  The edition of Barrons published on 30 October 2000 contained an article which the respondent claimed defamed him.  Over 300,000 copies of the magazine were sold in the United States of America and a small number were sold in Victoria.  The article was also published on 29 October 2000 by display upon the website conducted by the applicant in New Jersey.  The website has some 550,000 subscribers, several hundred of whom are in Victoria.

1. The respondent commenced proceedings in the Supreme Court of Victoria claiming damages for defamation.  The applicant applied for a stay of the proceeding or in the alternative an order that the service of the written statement of claim be set aside.  The judge who heard the application considered, inter alia, three broad issues, being jurisdiction, the construction of O. 7 and the question of forum non conveniens.

1. The judge refused the application, and application is now made for this Court for leave to appeal in so far as leave is necessary.

1. We think that the decision was made in an interlocutory application within the meaning of s.17A(4)(b) of the Supreme Court Act 1986. See the authorities reviewed by Callaway, J.A. in National Australia Bank Ltd. v. Maher[1].  The order did not grant or refuse relief or redress for the grievance in respect of which the proceeding was brought.  Whether such relief is granted or denied remains to be determined.  Counsel for the applicant contended that questions of jurisdiction stood in a special category so that the determination of jurisdiction was to be regarded as final.  Decisions as to jurisdiction may on occasion be practically decisive, but the Court “must have regard to the legal rather than the practical effect of the judgment.”[2] 

   [1][1999] 3 V.R. 589.

   [2]Computer Edge Pty Ltd v. Apple Computer Inc. (1984) 54 A.L.R. 767 at 768 per Gibbs, C.J.

1. The criteria to be satisfied in order to obtain leave to appeal are well settled:  the decision in respect of which leave is sought must be attended by sufficient doubt to warrant the grant of leave, and substantial injustice must be suffered by the applicant if the decision stands but is incorrect.  In the present case the principal issue is whether the decision was attended by doubt or was plainly correct.

1. A critical issue was the identification of the place in which the words emanating from the applicant’s website were published.  The computers, or servers, in which articles from the magazine were held are in the State of New Jersey.  A subscriber in Victoria who wishes to read the article activates his computer, which sends electronic signals to the web server.  The server delivers the document to the subscriber’s computer in Victoria.  It is only at that point that the document can be read by the subscriber.  The applicant’s contentions were twofold:  that the subscriber gained control of the document when his computer’s signal was received by the server in New Jersey and that control constituted publication.

1. We heard an extensive debate accompanied by written submissions and we were referred to and have read a large number of authorities.  This was not a case where the length of argument itself indicated that there was doubt attending the decision.  Rather, as the argument went on, it became clearer in our opinion that there was no substance in the contention that the Supreme Court of Victoria lacked jurisdiction.

1. The authorities establish that defamatory material is published at the time and in the place where it is made manifest in a form capable of being comprehended by a third party.  That is sufficient to dispose of this case, although we think that publication is not constituted by delivery without comprehension.  The principle has been applied to speech, writing, television, radio and telephone.  For the most part those authorities pre-date the internet, but in our view the established principles are appropriate to this new form of communication.

1. In our view that conclusion largely disposes of the submissions of the applicant based upon O. 7.  The service of the writ out of Australia was justified by paragraphs (i) and (j) of R. 70.1(1).  The proceeding is founded upon a tort committed within Victoria and is brought in respect of damage suffered in Victoria.  The later amendment of the statement of claim after the writ was served to plead defamation resulting from the publication of printed copies of the magazine in Victoria could not detract from the force of the unamended allegations based upon the publication of the article by means of the internet, which had earlier rendered service out of Victoria valid.

1. As to the plea of forum non conveniens, we perceive no appellable error in the exercise of the judge’s discretion.  Indeed we think the decision was plainly correct.  Publication took place in Victoria.  The plaintiff resides and carries on business in Victoria.  He wishes to restore his reputation in Victoria, and has undertaken to sue in no other place.  The illegal activities in which the plaintiff is said to have participated took place principally in Victoria.  The respondent has sued in respect of a section of the article which stands by itself.  The applicant may well try to broaden the debate.  However, a defence based upon Polly Peck v. Trelford[3] as that decision has been interpreted in David Syme v. Hore-Lacy[4] is hardly likely to lead to a case principally concerned with events in the United States of America.

   [3][1980] 6 Q.B. 1000.

   [4][2000] 1 V.R. 667.

1. For the foregoing reasons we are of the opinion that the decision is not attended by sufficient doubt to warrant the grant of leave.  The applicant made much of what counsel termed important and novel issues of law.  The importance and novelty of issues, however, does not justify the grant of leave if the issues have been decided in a manner that is plainly correct.