Ell v Milne (No 2)

[2012] NSWSC 259

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:	Ell v Milne (No 2) [2012] NSWSC 259
Hearing dates:	24 August 201115 September 2011
Decision date:	22 March 2012
Before:	McCallum J
Decision:	Plaintiff's application to have contextual imputation 8(a)(i) struck out refused. Defendant's application for leave to amend contextual imputation 8(a)(ii) refused.
Catchwords:	DEFAMATION - defences - contextual truth - whether contextual defendant's contextual imputations liable to be struck out - true innuendo - whether capable of sustaining plea of contextual truth
Legislation Cited:	Defamation Act 1974 Defamation Act 2005 Uniform Civil Procedure Rules 2005
Cases Cited:	Anderson v Mirror Newspapers Limited (No 1)(1986) 6 NSWLR 99 Astaire v Campling [1965] 3 All ER 666 Besser v Kermode [2011] NSWCA 174 Drummoyne Municipal Council v ABC (1990) 21 NSWLR 135 McMahon v John Fairfax Publications Pty Ltd (No 3) [2012] NSWSC 196 Whelan v John Fairfax & Sons Limited (1988) 12 NSWLR 148
Category:	Interlocutory applications
Parties:	Robert Ell (plaintiff)
Representation:	T Tobin QC with B Kelleher (plaintiff) T Molomby SC with L Goodchild (defendant) Stacks/The Law Firm (plaintiff) NLS Law Pty Ltd (defendant)
File Number(s):	2010/417226
Publication restriction:	None

Judgment

1. HER HONOUR: These are proceedings for defamation arising out of an email sent by Ms Katie Milne, who was at that time a councillor of Tweed Shire Council. The email was sent to a number of newspapers and special interest groups.

1. The defendant relies upon the defences of qualified privilege and contextual truth under s26 of the Defamation Act 2005. The defence first filed also included a plea of truth under s25 of the Act but that has since been abandoned.

1. On 27 June 2011, I directed the defendant to provide proper particulars of the defence of contextual truth in respect of one of the contextual imputations relied upon. I struck out the other contextual imputation relied upon by the defendant, with leave to replead.

1. An amended defence dated 2 September 2011 was propounded in response to those orders. The plaintiff contends that both contextual imputations sought to be relied upon in the amended defence are bad in form and that the plea of contextual truth should be struck out.

1. The relevant parts of the matter complained of are set out below:

Letter to the editor

From Clr Milne

Re: Cobaki and Kings Forest

Putting the Hard Word on the State Govt

I am calling on the community to demand the State Government uphold the request for an independent expert review for Kings Forest and Cobaki Lakes, despite this amendment, passed at the February Council meeting, being voted down at the March meeting....

The State Govt must also keeping mind that Cls Polglase and Clr Youngblutt received massive donations from this developer who donated $80,000 in the 2004 election campaign to the so called Balance Team. There are serious ethical questions about either of these Councillors voting on these developments, despite Clr Youngblutt not being elected for that Council. The entire Council was sacked largely due to the siphoning of such developer funds through this Tweed Directions campaign.

It would have been a very different vote for these two mini cities if Clr Polglase and Youngblutt had removed themselves from the vote as called for by the community. Instead they relied on an extremely questionable loophole that excused them from declaring any conflict after 4 years: I ask in what other sphere are people excused from pay back obligations after 4 years for such enormous sums involved.

It would also have been a very different outcome even only if Clr Holdom who ran on a community campaign had voted how her supporters have numerously lamented they expect her too (sic).

The developer Mr Bob Ell has made massive donations to both the State and Federal Labour and Liberal govts as well as the last Council.

Contextual imputation 8(a)(i)

1. The first contextual imputation relied upon by the defendant (pleaded in the existing defence) is:

8(a)(i)that as a developer [the plaintiff] has attempted to buy the favours of state government and the local council by making large donations to political parties and election campaigns.

1. The plaintiff submitted that imputation 8(a)(i) is liable to be struck out as being bad in form. It was submitted that, by reason of its reliance on the concept of buying favours by making large political donations, the imputation was pleaded at an impermissible level of generality and was of imprecise meaning, contrary to the principles stated in Drummoyne Municipal Council v ABC (1990) 21 NSWLR 135 at 137-8 per Gleeson CJ.

1. In Drummoyne, the Court of Appeal dismissed an appeal from a decision of Hunt J striking out the following imputations:

(a)That the plaintiff had carried out its functions as a Council corruptly in respect of the development and expansion of the Birkenhead Point Marina.

(b)That the plaintiff for reasons arising out of corruption victimised and harassed the proprietors and/or management of the Gladesville Marina.

(c)That the plaintiff was a corrupt Municipal Council.

1. In striking out those imputations, Hunt J had applied the test formulated in his earlier decision in Whelan v John Fairfax & Sons Limited (1988) 12 NSWLR 148 at 155 where his Honour said:

The issue which has to be decided in the particular case is whether there is likely to be confusion either at the pleading stage or at the trial in relation to the meaning for which the plaintiff contends.

1. The appeal was dismissed by majority. Gleeson CJ (at 138E) expressly approved the test in Whelan set out above. Priestley JA (at 155F) stated that he had reached agreement with Hunt J's conclusion without the need to rely on any of the decisions cited by Hunt J in a passage that included Whelan. Priestley JA explained:

This is because the appeal seems to me to be a relatively simple pleading case dependent on the long-established (and probably always self-evident) rule that a pleading must be sufficiently clear to the opposing party to enable that party to plead substantially in answer to it (if the party can) and to prepare for a trial in which the case proved by the evidence will not come as a surprise.

1. The existence of any distinction in practice between that rule of pleading and the test formulated by Hunt J in Whelan, approved by Gleeson CJ, is doubtful.

1. In a strong dissenting judgment, Kirby P railed against the requirement of excessive particularity in the formulation of imputations in defamation cases. In so doing, his Honour (at 149C) conceded the particular importance of the imputation under the Defamation Act 1974 being, as it then was, the plaintiff's cause of action. That, of course, is no longer the position: see s8 of the Defamation Act 2005.

1. Drummoyne is frequently cited in support of applications to have imputations struck out for want of specificity. However, even confining oneself to the two judgments in the majority, equal support may be found in that decision for the importance of avoiding an overly punctilious approach. The task in each individual case is to make a judgment based on considerations of practical justice.

1. Mr Tobin, who appeared with Mr Kelleher for the plaintiff, submitted that the allegation of buying favours by making large (political) donations creates confusion because it is capable of being understood in an anodyne sense of merely supporting particular candidates with a similar philosophy or simply buying a seat at the dinner table or a form of access to the politician in question. Equally, he submitted, it could be understood at the other end of the scale as indicating corruption of the kind seen in the making of cash payments in a brown paper bag.

1. I do not think the imputation suffers from the vice complained of on behalf of the plaintiff. As noted by Gleeson CJ in Drummoyne at 137B, "almost any attribution of an act or condition to a person is capable of both further refinement and further generalisation". His Honour's judgment reveals that the appropriateness of requiring greater specificity must ultimately be judged by reference to the content of the matter complained of.

1. The matter complained of in the present case clearly imputes conduct more serious than merely supporting the election of candidates with a vision sympathetic to that of the plaintiff or "buying a seat at the table". It is clear, as submitted on behalf of the defendant, that a notion of impropriety is conveyed. The letter opens by calling for an independent expert review of certain decisions made by councillors identified as having received "massive donations" from the plaintiff. It plainly questions the integrity of their decisions in respect of his development applications. Whilst the focus of those statements is on the conduct of the councillors rather than that of the plaintiff, those assertions lend colour to the defamatory meaning of the first contextual imputation. In my view, read in the context of the matter complained of, the meaning of the contextual imputation is sufficiently clear.

1. Separately, the plaintiff noted that the defendant seeks to rely upon all of the particulars of truth pleaded in support of the second contextual imputation as also establishing the truth of the first. Since the second contextual imputation amounts in effect to an allegation of electoral fraud, Mr Tobin submitted that the defendant's reliance on those particulars creates further confusion as to whether a more serious meaning is conveyed. In light of the conclusion I have reached as to the second contextual imputation, the defendant's reliance on those particulars will have to be revisited. In any event Mr Molomby, who appeared with Ms Goodchild for the defendant, expressly disavowed any reliance on illegal conduct as the meaning of the first contextual imputation.

1. In my view, contextual imputation 8(a)(i) is pleaded with adequate specificity and is not liable to be struck out.

Contextual imputation 8(a)(ii)

1. The second contextual imputation sought to be relied upon by the defendant is:

8(a)(ii)that as a developer, [the plaintiff] gave support, by providing $80,000 to Tweed Directions before the 2004 Council elections, to the election of groups of candidates who presented themselves to the public as independents, when they were not independent, he knowing that they were not independent and that the support of Tweed Directions for those candidates was not publicly revealed.

1. That imputation is not in the existing defence. The defendant requires leave to amend to plead that imputation. The plaintiff submitted that the proposed imputation is bad in form; is not capable of being defamatory and is not capable of being conveyed by the matter complained of.

1. Before dealing with those contentions, I should note an additional potential difficulty with imputation 8(a)(ii), which was not raised by the parties. The imputation is pleaded as a true innuendo. In my view, it is doubtful whether a true innuendo is capable of sustaining a defence under s26 of the Defamation Act. That section provides:

It is a defence to the publication of defamatory matter if the defendant proves that:

(a) the matter carried, in addition to the defamatory imputations of which the plaintiff complains, one or more other imputations ("contextual imputations") that are substantially true, and

(b) the defamatory imputations do not further harm the reputation of the plaintiff because of the substantial truth of the contextual imputations.

1. As explained by the Court of Appeal in Besser v Kermode [2011] NSWCA 174 at [78] per McColl JA (Beazley and Giles JJA agreeing at [1] and [2] respectively), a defence under that section must defeat all of the plaintiff's defamatory stings. In the present case, the plaintiff sues on a number of imputations all alleged to have been conveyed in the natural and ordinary meaning of the matter complained of (see paragraph 4 of the Amended Statement of Claim filed 2 February 2011).

1. A defamatory imputation conveyed by the matter complained of in its natural and ordinary meaning harms the plaintiff's reputation in the eyes of all those to whom it is published. Conversely, a true innuendo harms the plaintiff's reputation only among those to whom it was published who knew the extrinsic facts relied upon to lend the publication its defamatory meaning. The plaintiff's remedy is confined accordingly. In light of those considerations, I doubt whether the substantial truth of a true innuendo is capable of satisfying the requirement of s26(b), since it could never address the broader harm done to the plaintiff's reputation by the imputations conveyed to all recipients of the publication. As already noted, however, that consideration was not raised in argument and should not determine the present application, since the defendant has not been heard on the issue.

1. In my view, imputation 8(a)(ii) carries a substantial risk of causing confusion in the sense explained in Whelan (or embarrassment, in the language of the rules). A number of aspects of the imputation contribute to the problem. First, as submitted on behalf of the plaintiff, confusion is created by the apparent different use of the word "independent" in the two separate phrases, "who presented themselves to the public as independents" and "when they were not independent, he knowing that they were not independent". In the first phrase, the word appears to be used in its ordinary sense of an independent candidate, that is, a political candidate who is not a member of one of the major political parties. The word appears to be used in a different sense in the balance of the imputation as suggesting some unidentified alliance to particular interests (possibly, those of developers).

1. Secondly, there is temporal confusion in the imputation in that it is not clear whether it is alleged that, at the time the plaintiff made the donations in question, he knew that his support would not be publicly revealed. The imputation appears to allege knowledge of that fact at the time the donations were made, but the content of the allegation is that he knew the support "was not publicly revealed", knowledge he could only have acquired at some later time.

1. Finally, in my view, the imputation simply fails to distil the act or condition allegedly attributed to the plaintiff by the article on the strength of which it could be concluded that he has been defamed. The imputation appears to hint at his having been complicit in the conduct of the relevant candidates in misleading the public but the nature of the complicity is unclear.

1. For those reasons, I do not think the defendant should have leave to file an amended defence that includes contextual imputation 8(a)(ii) set out above.

1. In light of that conclusion, it is not necessary to consider the other contentions put on behalf of the plaintiff. However, in case my conclusion is wrong, I should indicate my views as to all issues raised.

1. Mr Tobin contended that contextual imputation 8(a)(ii) was not capable of being defamatory. In my view, a contextual imputation sought to be relied upon in support of a plea under s26 of the Defamation Act is not liable to be struck out on that basis alone, for the reasons I explained in McMahon v John Fairfax Publications Pty Ltd (No 3) [2012] NSWSC 196 at [17] to [24].

1. Separately, Mr Tobin submitted that the matter complained of is not capable of conveying the imputation as a true innuendo. It was submitted that the imputation trespasses upon the principles stated in Astaire v Campling [1965] 3 All ER 666. In that case, the plaintiff was identified on the front page of the defendants' newspaper as "the man known in the fight game as Mr X". The plaintiff pleaded a series of innuendos supported by extrinsic facts in the form of extracts from other newspapers which had defamed "Mr X". The way in which the case was put was that, by identifying the plaintiff as Mr X, the defendants had in effect published those other defamatory statements about him (to any reader who had read those other statements).

1. The English Court of Appeal held that it is not permissible by that device to make a defendant responsible for the defamatory statements of other persons which are not expressly or by implication approved, adopted or repeated in the matter complained of.

1. The argument on that issue in the present case gave rise to an interesting debate as to the use of extrinsic facts to import a defamatory meaning not derived from the terms of the matter complained of itself. Mr Tobin relied in particular upon the lucid analysis of that issue in the judgment of Hunt J in Anderson v Mirror Newspapers Limited (No 1)(1986) 6 NSWLR 99 at 108F-111E.

1. It must be noted, however, that Hunt J accepted in Anderson that binding authority precluded him from applying his analysis. His Honour considered that the matter complained of was incapable of conveying any true innuendo which the reader would not have understood the defendants to have intended to convey. However, his Honour felt confined in the circumstances to outlining what he saw to be "a fallacy in the reasoning" of authority to the contrary, evidently in the hope that his views would in due course receive appellate endorsement.

1. As interesting as the discussion was, I do not think it applied in the present case. Reasoning similar to that of Hunt J in Anderson underlies the decision in Astaire v Campling. However, in that case, it was expressly noted that it would be a very different matter if the defendant had "adopted, republished, reinforced or expressly agreed with" what had been published by others on other occasions.

1. In my view, the matter complained of in the present case is plainly capable of conveying to the reader who knew the findings of the extrinsic report relied upon in support of the true innuendo that the defendant intended to adopt or endorse those findings. However, for the reasons already stated, I do not think the imputation can stand in its present form.

1. Mr Tobin submitted that, having regard to the history of these proceedings, the defendant should not be given a further opportunity to replead the defence. Leaving aside the force of that submission, in light of the concern I have raised as to whether a true innuendo is even capable of sustaining a plea of contextual truth under s26 of the Defamation Act, I have my own reservations as to the utility of permitting any further amendment. I will hear the defendant on that issue and as to costs.

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Amendments

22 October 2012 - 2011 judgment re-published in error. Replaced with 2012 No. 2

Amended paragraphs: Whole judgment

12 September 2012 - Text added

Amended paragraphs: (1)

Decision last updated: 22 October 2012