Favell and Anor v Queensland Newspapers Pty Ltd and Anor

[2005] HCATrans 172

[2005] HCATrans 172

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Brisbane  No B29 of 2004

B e t w e e n -

PAUL JOSEPH FAVELL

First Applicant

DIANA GRACE FAVELL

Second Applicant

and

QUEENSLAND NEWSPAPERS PTY LTD

First Respondent

JESSICA LAWRENCE

Second Respondent

Application for special leave to appeal

McHUGH J
GUMMOW J

TRANSCRIPT OF PROCEEDINGS

AT BRISBANE ON MONDAY, 21 MARCH 2005, AT 9.52 AM

Copyright in the High Court of Australia

MR G.O’L. REYNOLDS, SC:   If it please the Court, in this matter I appear for the applicants with my learned friend, MR R.J. ANDERSON.  (instructed by Gail Malone & Associates)

MR. R.A. MULHOLLAND, QC:   If the Court pleases, I appear with my learned friend, MS D.C. SPENCE, for the respondents.  (instructed by Thynne & Macartney)

McHUGH J:   Yes, Mr Reynolds.

MR REYNOLDS:   Your Honours, in my submission this case raises two issues.  The first is whether there has been a miscarriage of justice because the courts below have struck out the applicants’ case where we submit a reasonable cause of action was disclosed on the pleadings, which thus deprives them from ever putting their case before a jury.

McHUGH J:   It is not a special leave point, is it?

MR REYNOLDS:   Not on its own, it is not, no, your Honour, or rarely.  The second issue which we submit is raised is the appropriate test to be applied on a strike out.  Can I deal first with my submission that there is a miscarriage and I would ask your Honours to have handy two things, first of all, page 94 of the application book and, secondly, a copy of the decision of this Court in Mirror Newspapers v Harrison.

Your Honours, in the time available to me can I focus on two imputations.  The first I will deal with is that the plaintiff, or both of them, were reasonably suspected by the police of committing the crime of arson.  If your Honours go to the application book at page 75, at line 45, your Honours will see that the Court of Appeal had no problem with an imputation that there were reasonable grounds for suspecting that the Favells were guilty of arson.

McHUGH J:   Mr Reynolds, can I stop you by saying I think if I had have been the trial judge I would have let this imputation go, but this Court cannot be taking on these cases.  This is a pleading point.  These matters have to stop in the Court of Appeal.  There is a limit to what cases we can take on. 

MR REYNOLDS:   Your Honour, can I say a couple of things about that.  The first is usually where that observation is made, and as your Honour well knows it is made by Justices of this Court all the time on these applications, it is after a full trial on the facts from the court at first instance and a rehearing in the Court of Appeal.  This is not just a strike‑out; it is a strike‑out that prevents the plaintiffs ever from putting their case before what this Court has described is the constitutional tribunal for determining defamation matters. 

The second thing that I would say in response to your Honour is this.  This case is a case on any view in a very, very short compass and if your Honours were minded to grant leave we would suggest it would be appropriate that very strict conditions be imposed upon the parties such as that the case was to proceed primarily on written submissions with a very, very short time.  I would only need 15 or 20 minutes.

McHUGH J:   Yes, I know, but Mr Reynolds, it is deeper than that.  I expressed the view I took, but these cases are notorious for division of opinion among appellate judges.  My view may be a minority.  The rest of the Court may be the same view of the courts below.  Why should this Court’s time be taken up dealing with such issues?  There is no precedent whatever in the case.  It just turns on its own facts.

MR REYNOLDS:   Your Honour well knows the Judiciary Act does provide ‑ ‑ ‑

McHUGH J:   Yes, I know.

MR REYNOLDS:   If there is a miscarriage your Honour needs no reminder of that.  I want to submit that there is a grave miscarriage here and I also want to submit that there is an important issue of law which may arise if your Honours were to grant leave.

GUMMOW J:   Perhaps we had better look at that.

MR REYNOLDS:   Well, your Honours, if I may, I am happy to do that.  I would prefer, if your Honours please, to get some momentum by showing ‑ ‑ ‑

GUMMOW J:   You seem to be losing it at the moment.

MR REYNOLDS:   Perhaps, your Honour.  I will deal then with General Steel.  Your Honours will have seen from our submissions we say essentially three things.  The first is that in Chief Justice Barwick’s judgment in General Steel he notes that there are ‑ ‑ ‑

GUMMOW J:   Well, does it come to this?  There seems to be some New South Wales defamation line of authority which sets up its own enclave as regards General Steel’s questions.

MR REYNOLDS:   Your Honour, we would submit does not set up its own enclave.  If your Honours go to page 92 of the application book, in particular paragraphs 3.83 and 3.87, your Honours will see that the English position and the position taken by Justice Brennan in this Court is that there is a distinction between the test applied on a strike‑out and one which applies on a separate determination of a question of law.  We would submit Justice Hunt was right in stating in the Monte Case in paragraph 3.85 there, that on a strike‑out something more has to be shown.  What that something more ‑ ‑ ‑

McHUGH J: But is this a live issue any more in New South Wales under Part 31 rule 2 of the Supreme Court Rules (NSW) once it is a question of law set down for argument? I would say you get the same result, do you not?

MR REYNOLDS:   Well, your Honour, if one takes what Justice Brennan there says in paragraph 3.87, he talks about a demurrer. That is the Part 31 proceedings in New South Wales and what happened in that case we have referred to of Hodges is that his Honour refused to strike out a statement of claim because it arguably disclosed a reasonable cause of action, but then said the demurrer will proceed on the different question of whether the pleading in fact does disclose. 

McHUGH J:   But this is high technicality because the most you could do on this point if this test is wrong is to have the case considered as under demurrer or under some particular question of law being set down and you get the same result.  I mean Justice Helman concluded that the words were not capable of bearing the imputations that the plaintiffs were guilty of arson, did he not, and that is the test - capacity on a demurrer or under a separate question of law for determination.

MR REYNOLDS:   Well, your Honour is putting to me that is the test on a demurrer and on a separate question of law.  We agree with that, but our point is we submit that is not the test on a strike‑out. 

McHUGH J:   All I am putting to you is that let it be accepted that you are right on this point and that the trial judge applied the wrong test, it is a question of whether this Court is going to have its time taken up to deal with something that is going to have no different result in the end.

MR REYNOLDS:   Well, your Honour, it may well, I submit, affect the result.  I will be submitting, and let me be frank about it, that on whatever test adopted on a strike‑out, my client will show the imputations are capable of arising.  Now, it is true that if your Honours accede to that argument then the question of what precise test arises on a strike‑out will be moot.  However, your Honours may not agree with that argument or think it is not quite as strong as I submit it is, in which case your Honours will then have to look at the more difficult question, which we submit is an important question, an unresolved question in this Court, as your Honours have noted from time to time, and my friends do not dispute that, but what is the appropriate test on a strike‑out.

Now, your Honours have, if I may respectfully say so, pulled me up on the question of whether there is a miscarriage.  I would ask your Honours to assume that in my favour and assume a reasonably strong one.  If your Honours were to grant leave in this case, the question of what is the appropriate test on a strike‑out would not be moot.  It may be, and I concede this, that your Honours would not have to…..but there is a real likelihood that your Honours would if there is any force in my learned friend Mr Mulholland’s submission that the imputations are not capable of arising.  The issue is not moot.

McHUGH J:   Yes, I know, but in these matters the opinions of the Queensland courts or the State courts are of importance.  You have to face up to the fact there are cultural differences in the States.  They may be extremely subtle but in this area that is what we are dealing with and it may be that a Queensland jury would take a different view of this to someone in New South Wales.  I mean, the facts in the story are extremely suspicious.  It is accepted that they have motive.  New South Wales, I would have thought, there was a case to go to the jury, for a jury’s determination.  Queensland judges have said no. 

MR REYNOLDS:   Your Honour, we submit that there is nothing in the particular locality that would affect the question of law.

McHUGH J:   No, judges are more likely to understand what the reaction of the ordinary, reasonable Queensland reader is than somebody from out of the State.

MR REYNOLDS:   With great respect, your Honour, the question of law would not depend upon nuances of attitude or philosophy ‑ ‑ ‑

McHUGH J:   Well, it is dressed up as a question of law.  It is a question of fact in reality.

MR REYNOLDS:   Well, as your Honour well knows, it has been many times stated to be the question of law.

McHUGH J:   Of course it is.

MR REYNOLDS:    And was stated, indeed, in the Court of Appeal to be a question of law.

McHUGH J:   Yes.  It shows reasonable cause in a malicious prosecution action but it is just a question of fact.

MR REYNOLDS:   Your Honour, I submit there is nothing that the Queensland Court of Appeal judges are soaking up through the pores of their skin that enabled them to decide this issue of law any better than this Court could.  I submit there is, and your Honour appears, with respect, to be conceding some force in this proposition, there is a miscarriage.  When your Honour sat on the Court of Appeal in New South Wales, your Honour, as I recall, drew a distinction when leave was sought on a determination on a separate trial between the situation of a plaintiff who had had his case knocked out, in which case your Honour was more inclined to grant leave and said so from the application of the defendant who said that the imputation should have been found incapable of arising.

We submit that so too in this case the position of these plaintiffs is different from the normal situation where a party is simply crying miscarriage.  There is, we submit, a fairly grave miscarriage.  Your Honour, as your Honour has said, certainly in New South Wales or probably in New South Wales this case would have been allowed to go to a jury and there is in this case an issue which may arise but which certainly arises which is an important question of law.  If your Honours please, those are my submissions.

McHUGH J:   Yes, Mr Mulholland.

MR MULHOLLAND:   Your Honours, three special leave questions are the ones which have been agitated by our friends today; that is, in relation to the proper test on a strike‑out application.  In our submission in relation to that, once the applicants were held to have failed the capability test, it did not matter whether one applied a General Steel test or some other test.  In fact, the test which had been applied by the primary judge was a test which included the utterly unreasonable test though whether it is utterly unreasonable or utterly unarguable, in the end what four judges have found is that these imputations were incapable of arising.  It is therefore, as your Honour the presiding judge has remarked, a highly technical argument in relation to what is the proper test in those circumstances.

If I can take your Honours to the page 73 of the record, paragraph [22] of Justice Jerrard’s judgment, picking up - this is at about line 38 - what Justice McPherson had said during argument:

As was remarked by the presiding judge on this appeal, if a particular meaning is incapable of arising or being attached to the words complained of, it must in consequence be so obviously untenable that it cannot possibly succeed as or in a claim of damages for defamation.

McHUGH J:   Well, I think that may be a debatable proposition.  I think you might be better off relying on substance.  It has always seemed to me to have been a difference between saying something just cannot possibly be argued, which is the General Steel’s test, and saying I think on the probabilities it is not capable.

MR MULHOLLAND:   Well, in any event ‑ ‑ ‑

McHUGH J:   I mean one has to draw this distinction not merely in the law of defamation, but in all fields as to whether there is evidence to support a proposition, et cetera.

MR MULHOLLAND:   That, however, your Honour, was in the course of deciding that it was incapable of arising.  These imputations were incapable of arising and once that decision was made under the local provisions of the Uniform Civil Procedure ‑ ‑ ‑

GUMMOW J:   Do we have rule 171 set out anywhere?

MR MULHOLLAND:   Your Honour, we did provide ‑ ‑ ‑

GUMMOW J:   Page 73, line 32.  That is not the actual text.  I want the actual text.  Is that set out anywhere?

MR MULHOLLAND:   We did ask that those be provided to your Honours.

GUMMOW J:   Yes.

MR MULHOLLAND:   Perhaps I can read it.

GUMMOW J:   No.

McHUGH J:   What rule is it, 171?

GUMMOW J:   Yes, we have it.

MR MULHOLLAND:   That, your Honour, was also considered in the light of rule 293, as your Honour will see at paragraph [22] of Justice Jerrard’s judgment.

McHUGH J:   Yes, but that rule has to be read in the light of the history - and the High Court Rules are very similar and General Steel’s test was formulated against that background. 

MR MULHOLLAND:   The other passage that I wanted to draw your Honours’ attention to was in paragraph [2] of Justice McPherson’s judgment.  This is at page 64 of the record where his Honour said:

Whether or not it ought to and will be struck out is ultimately a matter for the discretion of the judge who hears the application.  Such a step is not to be undertaken lightly but only, it has been said, with great caution.  In the end, however, it depends on the degree of assurance with which the requisite conclusion is or can be arrived at.

McHUGH J:   But is there not some inconsistency in that proposition and the earlier proposition.  I mean, if it is not capable, it is not a question of discretion, it is a question of law.

MR MULHOLLAND:   Yes, I do not think there was any doubt ‑ ‑ ‑

McHUGH J:   The more you go into this judgment the more you are making me wonder whether or not there may not be a special leave application in this.

MR MULHOLLAND:   Your Honour, we submit that there is no special leave application in a situation where the court below has found that these imputations are incapable of arising and that decision means, in our submission, that it would fail whatever test was applied.

McHUGH J:   Yes, well that is your strong ‑ ‑ ‑

MR MULHOLLAND:   Thank you, your Honour.

McHUGH J:   Yes, Mr Reynolds.

MR REYNOLDS:   Your Honours, we set out at page 91 of the application some of the tests referred to by Sir Garfield Barwick.  This is at about point 3 of the page.  Your Honours will see that there is some substantial difference between the ones at the top which are more difficult from an applicant’s point of view on a strike‑out than those lower down.  They talk there about whether the matter admits of argument or admits of reasonable argument.

Now, that is a matter which was adverted to in this Court in a case referred to on page 72 of the application book.  At about line 30 the Court of Appeal refers to a decision in Murphy v Australian Consolidated Press and in the last five lines of page 72 your Honours will see that there, and this was a defamation case, the various judges emphasised the word “clearly”.  They said whether “the plaintiff’s declaration clearly failed to disclose any cause of action”.

GUMMOW J:   Part of the trouble with all this is there are endless glosses on the rules, it seems to me.

MR REYNOLDS:   Quite, and, of course, these tests have grown up in two contexts:  one, the inherent jurisdiction of the court to strike out and, second of all, interpreting the particular rules but, as your Honour Justice McHugh said, these tests have been articulated in the context of rules which are substantially cognate throughout all the jurisdictions of Australia.  This issue, I submit, not only arises in defamation cases, it arises in all cases throughout the Commonwealth and in all jurisdictions of the Commonwealth and for that reason it raises a matter of importance which your Honours should look at assuming, as I submit, that there is and there has been disclosed a reasonably strong case for a miscarriage of justice.  If your Honours please, those are my submissions.

GUMMOW J:   What is the critical passage in Sir Garfield Barwick’s judgment in General Steel, which after all is a patent case, is it not?

MR REYNOLDS:   It was.  The particular passage is at page 129.  We purported to summarise the matters referred to there.

McHUGH J:   About point 5:

“so obviously untenable that it cannot possibly succeed”; “manifestly groundless” ‑ ‑ ‑

MR REYNOLDS:   Those are the sorts of matters, but perhaps if I can take the middle paragraph there at about point 6.  His Honour says:

At times the test has been put as high as saying that the case must be so plain and obvious that the court can say at once that the statement of claim, even if proved, cannot succeed; or “so manifest on the view of the pleadings, merely reading through them, that it is a case that does not admit of reasonable argument”; “so to speak apparent at a glance”.

Your Honours, we spent a day in the Court of Appeal apparently debating a matter which my learned friends would say does not admit of reasonable argument.  They cannot, I submit, satisfy that test.

McHUGH J:   No, but in the same case Sir Garfield said that it may take a long time to demonstrate ‑ ‑ ‑

MR REYNOLDS:   Yes, he did; that is said on the following page.  He said at page 130, point 4, that:

Argument, perhaps even of an extensive kind, may be necessary –

and I submit that in so doing his Honour was, in effect, indicating a preference for a test which is different from that noted at page 29, point 6.  So all the time we have these different tests and a different result may obtain depending upon, for example, the degree of argument and the degree of obviousness of the point of law.  If your Honours please, those are my submissions.

McHUGH J:   Thank you.  Yes, there will be a grant of special leave in this case.

AT 10.16 AM THE MATTER WAS CONCLUDED