Fox v Channel Seven Adelaide Pty Ltd (No 2) - [2020] SASC 180

SUPREME COURT OF SOUTH AUSTRALIA
(Civil: Application)
FOX v CHANNEL SEVEN ADELAIDE PTY LTD & ORS (No 2)
[2020] SASC 180
Judgment of The Honourable Justice Stanley
25 September 2020
DEFAMATION - ACTIONS FOR DEFAMATION - PARTICULARS - OF STATEMENT OF DEFENCE OR PLEA - JUSTIFICATION
PROCEDURE - STATE AND TERRITORY COURTS: JURISDICTION, POWERS AND GENERALLY - INHERENT AND GENERAL STATUTORY POWERS - TO PREVENT ABUSE OF PROCESS - OTHER PARTICULAR CASES
PROCEDURE - CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS - PLEADINGS - STRIKING OUT - OTHERWISE ABUSE OF PROCESS
There are two applications before the Court. The plaintiff has brought an application to strike out the third defence to his claim of defamation. The defendants apply for permission to amend in terms of a fourth defence.
The plaintiff was involved in a charitable foundation called Camp Gallipoli. It ran a series of events on a not-for-profit basis. The foundation entered into various service contracts with companies in which the plaintiff had an interest and there were various promotions of the events. In due course there was some controversy about them. There were articles in the national media, including broadcasts by the defendants.
The plaintiff’s claim in defamation relies on five broadcasts on the television program Today Tonight Adelaide on 25 April 2016, 9 May 2016, 13 July 2016, 27 October 2016 and 24 January 2017. The plaintiff pleads some 43 defamatory imputations arising from the broadcasts.
The defendants are intending to remedy certain issues with the pleading via the filing of the fourth defence. However, at issue was whether some of the particulars in the third defence are so remote from the principal issues in the proceedings that they should be struck out on the basis that the resources of the parties and the Court needed to determine the defences pleaded would be disproportionate to the interests at stake (the proportionality principle).
Held:
1. It is proper for the Court to have regard to the proportionality between on the one hand the time and cost incurred in proceedings and on the other hand the importance and value of the subject matter of the proceedings in determining whether a pleading should be struck out as an abuse of process.
2. The plaintiff has made a forensic decision to plead very broad imputations. In those circumstances, it must be open to the defendant to justify those broad imputations by reference to particulars that identify specific instances of conduct where the plaintiff has engaged in conduct meriting those broad imputations. To establish an abuse of process in these circumstances the plaintiff must establish that he will be denied a fair trial if the impugned particulars are not struck out.
3. Paragraph 53B of Annexure A to the third defence is struck out. Otherwise the plaintiff’s application is dismissed.
4. Permission is granted to the defendants to file and serve the fourth defence.
Supreme Court Civil Rules 2006 (SA) r 104(b); Uniform Civil Rules 2020 (SA) r 12.2(2)(d), referred to.
Jameel v Dow Jones & Co Inc. [2005] QB 946; Bleyer v Google Inc (2014) 88 NSWLR 670; Armstrong v McIntosh (No. 2) [2019] WASC 379; Favell v Queensland Newspapers Pty Ltd (2005) 79 ALJR 1716; Goldsmith v Sandilands (2002) 76 ALJR 1024, discussed.
Hunter v Chief Constable of the West Midlands Police [1982] AC 529; Farrow v Nationwide News Pty Ltd (2017) 95 NSWLR 612; Khalil v Nationwide News Pty Ltd (No. 2) [2018] NSWDC 126; Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175; Rogers v The Queen (1994) 181 CLR 251; Batistatos v Roads and Traffic Authority of New South Wales (2006) 226 CLR 256; Moti v The Queen (2011) 245 CLR 456; Penton v Calwell (1945) 70 CLR 219; Anderson v Mirror Newspapers (No. 2) (1986) 5 NSWLR 735; Cohen v Daily Telegraph Ltd [1968] 1 WLR 916 at 919; Ashworth aka Otto v Nine Network Australia Pty Ltd (No. 2) [2019] NSWDC 188; Australian Broadcasting Corporation v Chau Chak Wing (2019) 271 FCR 632, considered.

FOX v CHANNEL SEVEN ADELAIDE PTY LTD & ORS (No 2)
[2020] SASC 180
Civil: Application
STANLEY J:
Introduction

This is an action for defamation. Predictably the parties are arguing over pleadings.
The plaintiff has brought an application to strike out the third defence. On the other hand, the defendants apply for permission to amend in terms of a fourth defence they propound. The defendants objected to certain evidence set out in an affidavit of the solicitor for the plaintiff but accepted that the evidence could be admitted and dealt with by the Court as a question of weight. That is the approach I have taken.
The plaintiff was involved in a charitable foundation called Camp Gallipoli Foundation (Camp Gallipoli). It ran a series of events on a not-for-profit basis. The foundation entered into various service contracts with companies in which the plaintiff had an interest and there were various promotions of the events. In due course there was some controversy about them. There were articles in the national media quite apart from the broadcasts run by the first and third defendants. There were issues about the use of the ANZAC logo on commercial items which were sold at the Target chain of stores in connection with the events. Ultimately the foundation collapsed.
The broadcasts referred adversely to claims the plaintiff made to various media outlets concerning his personal connection with a family who had lost a large number of siblings in the First World War. There were other references to aspects of the plaintiff’s personal financial history including him being made bankrupt, a claim on his curriculum vitae that he had been awarded a degree that had not been conferred, references to other litigation in which he had been involved and various incidents in his career. But the genesis of all of these allegations was the Camp Gallipoli events.
Amongst other things the plaintiff alleges that the first broadcast conveyed the defamatory imputation that Camp Gallipoli was a money-making vehicle for him; that Camp Gallipoli had promised benefits to the RSL and Legacy that were not received and there was an improper or inappropriate use of the ANZAC name. The plaintiff alleges that the second broadcast conveyed the defamatory imputation that he had lied about his ancestors’ involvement in World War I for the commercial purpose of promoting the Camp Gallipoli events. The plaintiff alleges that the third broadcast contained the defamatory imputation that the plaintiff had denied the RSL and Legacy the funds that had been promised and instead the funds raised through Camp Gallipoli had been used by the plaintiff to purchase a luxury home which became his residence. There was reference to him having failed to account for charity moneys and his previous bankruptcy. The plaintiff alleges that the fourth broadcast conveyed the defamatory imputation that he had misrepresented his academic record; that he was personally responsible for the debts of a business at Victor Harbor, but has turned his back on creditors and continues to live a profligate lifestyle; and has used Camp Gallipoli to personally and improperly make large amounts of money including by misappropriating funds. The plaintiff alleges that the fifth broadcast conveyed the defamatory imputation that due to his conduct the RSL and Legacy had not received any funds and that he has failed to account for large amounts of money raised in the name of Camp Gallipoli and has been guilty of serious breaches of charity laws.
The plaintiff’s claim relies on five broadcasts on the television program Today Tonight Adelaide on 25 April 2016, 9 May 2016, 13 July 2016, 27 October 2016 and 24 January 2017. The plaintiff pleads some 43 defamatory imputations arising from the broadcasts. Some of those imputations are pleaded in general terms, including the following:
(1)The plaintiff is a liar (liar imputation);[1]
(2)The plaintiff is a fraud (fraud imputation);[2]
(3)The plaintiff is unethical, deceptive, unreliable and/or dishonest (deceptive and unreliable imputation);[3] and
(4)The plaintiff has misappropriated funds (misappropriation imputation).[4]
[1]    Paragraphs 19.1.3, 19.3.4 and 19.4.1 of the Statement of Claim.
[2]    Paragraphs 19.1.1, 19.2.2 and 19.4.2 of the Statement of Claim.
[3]    Paragraphs 19.1.10, 19.2.6, 19.3.7, 19.4.8 and 19.5.4 of the Statement of Claim.
[4]    Paragraph 19.4.9 of the Statement of Claim.
In addition to the broad imputations, the plaintiff also pleads a more specific defamatory imputation that he has failed to account for moneys given to the foundation (the accounting imputation).[5]
[5] Paragraphs 19.1.4 and 19.5.1 of the Statement of Claim.
The pleadings in issue
The plaintiff’s application raises three issues. They are whether the defence of fair comment/honest opinion pleaded in the third defence relies on particulars that were not known by the defendants at the time of the impugned broadcasts. Second, whether the defence of qualified privilege relies on particulars that were not known by the defendants at the time of the broadcasts. Third, whether some of the particulars in the third defence are so remote from the principal issues in the proceedings that they should be struck out because the resources of the parties and the Court needed to determine the defences pleaded would be disproportionate to the interests at stake (the proportionality principle).
The defendants effectively concede the first two issues in relation to the third defence. They address those issues in the proposed fourth defence. Accordingly, subject to matters raised for the first time at the hearing of the application, the contest between the parties is confined to the third issue of whether the particulars pleaded in relation to the above issues are so remote from the principal issues in the action they should be struck out as offending the proportionality principle.
The plaintiff identifies seven issues which the defendants have pleaded as particulars of justification of the imputation that the plaintiff is a fraud which they allege are so peripheral to the real issues between the parties that they should be struck out. Those issues are:
1.The Daimler plate issue (paragraphs 31A to 31J of annexure A);
2.The A&G Developments issue (paragraph 39A to 39Q of annexure A);
3.The swag issue (paragraphs 59A to 59O of annexure A);
4.The dog tag issue (paragraphs 68A to 68L of annexure A);
5.The fail to account to Gout issue (paragraph 53B of annexure A);
6.The Gallipoli Nominees payment policy (paragraphs 68M to 68P of annexure A); and
7.The loans issue (paragraphs 95 to 98 of Annexure A).
Applicable legal principles
It is common ground that the Court has an inherent power to strike out a pleading as an abuse of process.[6] The Court also can strike out a pleading pursuant to the Rules if it is an abuse of process.[7] At issue on this application is the applicability of the proportionality principle upon which the plaintiff relies and whether the particulars of justification pleaded by the defendants should be struck out in reliance upon the principle.
[6] Hunter v Chief Constable of the West Midlands Police [1982] AC 529 at 536.
[7] Supreme Court Civil Rules 2006 (SA) r 104(b). SCR 2006 applies in accordance with Uniform Civil Rules 2020 (SA) r 1.4 as the filing of the strike out application occurred before the commencement date.
The leading authority on the proportionality principle is the decision of the English Court of Appeal in Jameel v Dow Jones & Co Inc.[8]It recognised the principle as a form of abuse of process.[9] The Master of the Rolls, Lord Phillips, who delivered the judgment on behalf of the Court staying a claim in defamation, said:[10]
If the claimant succeeds in this action and is awarded a small amount of damages, it can perhaps be said that he will have achieved vindication for the damage done to his reputation … but both the damage and the vindication will be minimal. The cost of the exercise will have been out of all proportion to what has been achieved. The game will not nearly not have been worth the candle, it will not have been worth the wick. … It would be an abuse of process to continue to commit the resources of the … court, including substantial judge … time, to an action where so little is now seen to be at stake.
[8] [2005] EWCA Civ 75, [2005] QB 946.
[9] [2005] EWCA Civ 75 at [70], [2005] QB 946 at 970.
[10] [2005] EWCA Civ 75 at [69]-[70], [2005] QB 946 at 969-970.
In Bleyer v Google Inc,[11] McCallum J, in the Supreme Court of New South Wales, applied the principle in Jameel holding that the court has the power permanently to stay or dismiss proceedings as an abuse of process in circumstances where the resources of the court and the parties that will have to be expended to determine the claim are out of all proportion to the interests at stake.[12] Subsequently Bleyer was cited with approval by Basten JA in obiter remarks in Farrow v Nationwide News Pty Ltd.[13]However, there are appellate court judgments which cast doubt on the proposition that the proportionality principle forms part of the Australian common law.[14]
[11] [2014] NSWSC 897, (2014) 88 NSWLR 670.
[12] [2014] NSWSC 897 at [62], (2014) 88 NSWLR 670 at 681.
[13] [2017] NSWCA 246 at [5], (2017) 95 NSWLR 612 at 613-614.
[14] Those authorities are conveniently set out in the judgment of Gibson DCJ in Khalil v Nationwide News Pty Ltd (No. 2) [2018] NSWDC 126 at [40].
In Bleyer McCallum J noted that in applying the principle of proportionality the value of the interests at stake needs to be assessed by reference to matters other than the amount of money involved. Her Honour identified defamation proceedings as such an instance, given the importance of non-monetary considerations such as the vindication of reputation.[15]
[15] [2014] NSWSC 897 at [63], (2014) 88 NSWLR 670 at 682.
While the reasoning in Bleyer depends to some extent upon the specific legal framework in New South Wales, namely, s 67 of the Civil Procedure Act 2005 (NSW) and r 13.4 or r 14.28 of the Uniform Civil Procedure Rules 2005 (NSW), equivalent provisions can be found in rules 12.1(2)(o) and 12.2(2)(d) of the Uniform Civil Rules 2020 (SA).
The proportionality principle has recently been considered by the Supreme Court of Western Australia in Armstrong v McIntosh (No. 2)[16] where Le Miere J implicitly accepted the applicability of the proportionality principle in Australian law. He treated it as a species of abuse of process. As such, he affirmed that it is only in rare and compelling circumstances that a court will find proceedings amount to an abuse of process on the grounds of proportionality. Great care must be exercised in determining to strike out proceedings on that basis.[17]
[16] [2019] WASC 379.
[17] [2019] WASC 379 at [118].
The defendants submit that there is a dearth of authority for the proposition that the proportionality principle can keep a defendant out of a defence in a defamation claim.
While the reasoning in Bleyer was made in the context of issues sought to be litigated by a plaintiff in defamation proceedings, the authorities do not exclude those principles from applying equally to pleas sought to be raised by a defendant to such proceedings by way of the defences of justification and contextual truth.
Gatley states the proportionality principle in the following terms:[18]
In determining whether to strike out material pleaded in a defence of justification or honest comment, the court will seek to strike a balance between the legitimate defence of free speech and free comment on the one hand and on the other hand the costs which might be involved if every peripheral issue was examined and debated at the trial.
[18] Gatley on Libel and Slander, 12^th ed, at [30.45] citing Rechem International Ltd v Express Newspapers Plc, The Times, unreported judgment of Court of Appeal delivered 19 June 1992.
In defamation proceedings in particular, courts must be alive to the risk of large media defendants seeking to deep pocket plaintiffs. This concern was enunciated in Favell v Queensland Newspapers Pty Ltd[19] where Kirby J said:[20]
In considering the imputations pleaded alongside the matter complained of, it is important that courts, deciding issues such as the present, should keep in mind the practical burdens and consequences that flow from excessive refinement in such matters. They should remember that the tribunal established by law (whether a jury or a judge) to decide claims in defamation will normally have a large capacity of its own to deal with far-fetched and remote imputations in a commonsense way. It is a mistake to consider that this capacity is confined to the practice court and appellate judges, stimulated by imaginative pleaders "armed with a bank of dictionaries and a Thesaurus".
A reflection on this consideration confirms my support for the conclusion reached in the joint reasons. Those reasons correct what I take to have been an approach of excessive refinement on the part of the primary judge and of the Queensland Court of Appeal. Such an approach, in such matters, is to be discouraged. Overwhelmingly, it favours one side, namely defendants. It exhausts the means of the plaintiffs, including those with just claims. It delays the trial. And it undermines the utility of the tort of defamation as a practical means for defending respect in our society for the reputation of others. For ordinary Australians, suing a media defendant in defamation is a very risky way of vindicating wrong to one's good name. Usually, it is only the foolhardy who try. Part of the reason is the resulting trial by interlocutory ordeal. If the remedy of defamation is to be fair to both sides, courts must do something to discourage, or minimise, such impediments.
[citations omitted]
[19] [2005] HCA 52, (2005) 79 ALJR 1716.
[20] [2005] HCA 52 at [21], [22], (2005) 79 ALJR 1716 at 1722.
For my part I am prepared to proceed on the basis that the Court is empowered to strike out pleadings that are an abuse of process. As the High Court has identified, the categories of abuse of process are not closed.[21] The increasing emphasis in the authorities on the efficient disposition of judicial time, the Court’s resources and the parties’ costs, as exemplified in the High Court’s judgment in Aon Risk Services Australia Ltd v Australian National University,[22] supports the conclusion that it is proper for the Court to have regard to the proportionality between, on the one hand, the time and cost incurred in proceedings and, on the other hand, the importance and value of the subject matter of the proceedings. This approach finds expression in the Uniform Civil Rules 2020 (SA).[23]
[21] Rogers v The Queen [1994] HCA 42, (1994) 181 CLR 251 at 286; Batistatos v Roads and Traffic Authority of New South Wales [2006] HCA 27 at [7]-[15], (2006) 226 CLR 256 at 264-267; Moti v The Queen [2011] HCA 50 at [10], (2011) 245 CLR 456 at 463-464.
[22] [2009] HCA 27, (2009) 239 CLR 175.
[23] Rule 12.2(2)(d).
Overview
The proper approach to pleadings is considered in Goldsmith v Sandilands[24] where Gleeson CJ observed that it is the role of the judge during the course of a trial to maintain proper limits upon the extent to which parties and their lawyers will be permitted to raise and investigate matters that are of only marginal significance to the facts in issue.[25] He went on to say that the facts in issue in a civil case emerge from the pleadings. The primary rule of evidence is that a court will receive, and will only receive, evidence that is relevant to the facts in issue. The general rule that relevant evidence will be received is subject to certain qualifications based upon considerations of justice or practicality. One such qualification limits the investigation of collateral matters, being facts not constituting the matters directly in issue between the parties or facts relevant to a fact in issue.[26]
[24] [2002] HCA 31, (2002) 76 ALJR 1024.
[25] [2002] HCA 31 at [1]-[2], (2002) 76 ALJR 1024 at 1025.
[26] [2002] HCA 31 at [3], [31]-[32], (2002) 76 ALJR 1024 at 1025-1026, 1029-1030.

The facts in issue include those material facts that provide any justification or excuse for, or a defence to, the cause of action.
Ultimately notwithstanding the concern the Court holds in relation to the issue of proportionality as a general matter, in this particular case the plaintiff could have limited his claim, and thereby narrowed the available grounds of defence and issues for trial, by confining the pleaded imputations to specific allegations arising in the context of the foundation or some specific aspect of the conduct of Camp Gallipoli. However, the plaintiff made a forensic decision to plead very broad imputations. In those circumstances it must be open to the defendants to justify those broad imputations by reference to particulars that identify specific instances of conduct where the plaintiff has engaged in conduct meriting those broad imputations,[27] whether or not those instances are referred to in the broadcasts complained of, and whether or not they had occurred at the alleged time of publication.[28] A defendant may justify a defamatory publication by reference to facts not known to the publisher at the time of publication but ascertained subsequently.[29] To establish an abuse of process in these circumstances the plaintiff must establish that he will be denied a fair trial if the impugned particulars are not struck out. It cannot be fair to permit the plaintiff in defamation proceedings, who defines the scope of the trial, to allege broad, general imputations and then insist that the defendant contests the proceedings with one hand tied behind its back.
[27] Penton v Calwell [1945] HCA 51, (1945) 70 CLR 219; Anderson v Mirror Newspapers (No. 2) (1986) 5 NSWLR 735 at 737.
[28] Cohen v Daily Telegraph Ltd [1968] 1 WLR 916 at 919; Ashworth aka Otto v Nine Network Australia Pty Ltd (No. 2) [2019] NSWDC 188 at 146.
[29] Australian Broadcasting Corporation v Chau Chak Wing [2019] FCAFC 125 at [138]-[141], (2019) 271 FCR 632 at 675-676.
In these circumstances the impugned particulars are not collateral matters in the sense identified in Goldsmith, nor are they peripheral.
The relevant particulars are relied upon in support of the defences of justification pleaded in respect of the broad imputations set out above. Paragraphs 31A to 31J are relied upon to justify the liar imputation in respect of the first broadcast, and the fraud imputation in respect of the second and fourth broadcasts and the misappropriation imputation in respect of the fourth broadcast.
Paragraphs 39A to 39Q are relied upon to justify the fraud imputation in respect of the first, second and fourth broadcasts and the misappropriation imputation in respect of the fourth broadcast.
Paragraph 53B is relied upon to justify the deceptive and unreliable imputation pleaded in respect of the second, third, fourth and fifth broadcasts.
Paragraphs 68M to 68P are relied upon to justify the deceptive and unreliable imputation in respect of all broadcasts.
Paragraphs 95 to 98 are relied upon to justify the deceptive and unreliable imputation in respect of all broadcasts.
Finally paragraph 53B is relied upon to justify the accounting imputation in respect of the first and fifth broadcasts.
Consideration
The Daimler plate issue
The pleading is that the plaintiff rendered an invoice for the sale of a Daimler numberplate in which GST was expressly charged. The allegation is that the plaintiff did so with the intention of not remitting the GST to the ATO and that he did not do so. The particulars are said to be relevant to the liar, fraud and misappropriation imputations.
The plaintiff submits that the pleading of this issue relates to events that occurred in 2012 well before Camp Gallipoli came into existence. It derives from claims made by the plaintiff’s then trustee in bankruptcy which are rejected by the plaintiff. The plaintiff submits that his capacity even to investigate the issue is extremely limited as relevant witnesses would be difficult to trace. Nonetheless, the plaintiff submits that dealing with this issue could occupy two to three days of hearing time.
The defendants submit that for the purpose of determining the strike-out application the Court must assume that they will be able to prove the truth of the allegation. Accordingly, putting in issue the facts of the allegations cannot constitute an abuse of process. They submit that there is no evidence before the Court that the hearing of this issue would take two to three days.
I accept the submission of the defendants. The plaintiff has not established the plea is an abuse of process. I would not strike out the plea.
A&G Developments
The pleading is that the plaintiff, through an intermediary, conducted negotiations with the supplier to the one of the Camp Gallipoli events. The plaintiff charged the supplier $88,000 on the basis that the supplier would have exclusive rights to sell its beverages at the event. The allegation is that the plaintiff knew at the time that he was in no position to make such a promise and knew that the venues at which the events would occur had the right to decide which beverages would be sold at their venue.
The plaintiff submits that he personally had an extremely limited involvement with A&G Developments. The person who was dealing with the supplier is now deceased. He submits that the significance of the issue is disproportionate to the core proceedings. No mention of A&G Developments was made in any of the broadcasts. He contends that the defendants are seeking to run a misleading and deceptive conduct claim in circumstances where A&G Developments has not seen fit to bring such proceedings.
The defendants submit that the particulars are directly related to Camp Gallipoli. The defendants bear the onus of proving these allegations. It is irrelevant whether A&G Developments sued. There is no proper basis upon which the defendants should be precluded from raising this defence as an abuse of process.
I accept the defendants’ submission. The plaintiff has not established the plea is an abuse of process. I would not strike out the plea.
The swag issue
The allegations is that swags were to be sold by Target stores for the benefit of the Camp Gallipoli. It is alleged that entities controlled by the plaintiff received substantial funds from Target in circumstances where the actual supplier of the swags, Outdoor Accessories, was owed money for having made and supplied the swags. It is alleged Target paid the plaintiff’s entity, Gallipoli Nominees, some $234,000 but, six weeks later, the plaintiff was representing to Outdoor Accessories that he was not in a position to pay it because he was awaiting payment from Target.
The plaintiff submits that the issue is only peripherally related to Camp Gallipoli and involves complicated commercial issues where the ability of Camp Gallipoli to discharge certain of its financial liabilities was directly affected by the subject defamation. The issue would involve the calling of numerous witnesses and spending multiple days of court time. In the circumstances it is disproportionate to the main issue in the proceedings.
The defendants submit that the allegation is central to the conduct of the Camp Gallipoli events. They will either prove the allegations or not, but they are highly relevant to the liar imputation, the fraud imputation and the deceptive and unreliable imputation.
I accept the defendants’ submission. The plaintiff has not established the plea is an abuse of process. I would not strike out the plea.
The dog tag issue
The dog tag issue falls into the same category as the swag issue. The plaintiff submits that it has the potential to add a week to the trial and that parties to a commercial transaction can have a dispute without it being indicative of fraud.
The defendants submit that the issue of proportionality is of little moment in light of the general nature of the imputations pleaded. In this case the dog tag issue, like the swag issue, is central to the operations of the Camp Gallipoli foundation. There is no abuse of process. There is no evidence that the issue would occupy a week or hearing.
I accept the defendants’ submission. The plaintiff has not established the plea is an abuse of process. I would not strike out the plea.
The failed account to Gout issue
The pleading is that the plaintiff failed to account for monies donated to the foundation. The defendants seek to rely upon the plaintiff’s failure to provide documentation to the second defendant.
The plaintiff submits that the accounting imputation can only relate to a failure on the part of the plaintiff to account for monies given to the foundation to some authority to whom he or the foundation was accountable, such as the Department of Veterans Affairs (the department) or the Australian Charities and Not-for-profits Commission (the commission). He submits the particulars cannot justify the imputation on the basis that there was no obligation on him to account to the second defendant. In any event, the plaintiff submits he was under no obligation to provide any account to the second defendant when the second defendant failed to comply with responsible standards of journalism.
The defendants submit that the accounting imputation does not suggest that the plaintiff had a specific obligation to account to the second defendant, but plead the failure to respond to the second defendant’s requests for documents as examples of instances where the plaintiff has generally failed to produce financial documentation that would otherwise demonstrate how monies donated to the foundation were handled or utilised. The particulars reflect the defendants’ case that the plaintiff failed to produce documentation that would shed light on how monies donated to the foundation were used.
I accept the plaintiff’s submission. The plea that the plaintiff has failed to account for monies given to the foundation implies that he must be under an obligation to do so and has breached that obligation. The particulars seeking to justify the imputation constitute an abuse of process.
They do not disclose a reasonable prospect of the defendants successfully defending the imputation in reliance on these particulars.
I would strike out paragraph 53B of Annexure A to the defence.
Gallipoli Nominees payment policy issue
The particulars pleaded seek to justify the general deceptive and unreliable imputation. The issue concerns a policy requirement that the foundation had to obtain approvals for expenditure over a specified amount. It is alleged this did not occur.
The plaintiff submits that the issue lacks substance and might occupy a week of the hearing. The plaintiff contends that the issue lacks substance because the department conducted an investigation which failed to identify any basis for concern.
The defendants submit that the department’s audit concerned a different period and there is no evidence to support the submission that the hearing of this issue would occupy a week. The audit was confined to a consideration of how monies the department granted to the foundation in 2015 were utilised. The review did not consider whether the plaintiff complied with the Gallipoli Nominees payment policy in 2016 and so could not have absolved him from any allegations of impropriety.
I accept the defendants’ submissions. The plaintiff has not demonstrated that the particulars pleaded by way of justification constitute an abuse of process. I would not strike out the plea.
Loans issue
The defendants seek to plead by way of particulars of justification of the deceptive and unreliable imputation that the plaintiff knew that any loan agreements between the foundation and a third party required the approval of the Board of the foundation. Nonetheless, the plaintiff arranged loans from Jamie Codling and Andrew Fox in order to pay a foundation creditor, Nunn Media. Those loans were subsequently repaid using funds in the Gallipoli Nominees account without the permission or knowledge of the Board.
The plaintiff submits that these matters were examined by the department and the commission without comment or criticism. Moreover, any failure on the part of Camp Gallipoli to discharge any financial obligations in respect of the loans was affected by the subject broadcasts.
The defendants submit the review conducted by the department was limited to whether invoices submitted by the foundation to the department for the purpose of obtaining its funding were processed by the department in accordance with the relevant payment principles. That the Codling payment and the Fox payment were made using monies held in the bank account of Gallipoli Nominees, rather than the foundation, would not have been evident from a review of the foundation’s financial documentation by the department or the commission. Accordingly, the plaintiff’s reliance on the commission’s investigation and the department’s review is unwarranted. In any event the plaintiff has not demonstrated that the particulars of justification in relation to the loans issue is an abuse of process.
I accept the defendants’ submissions. The plaintiff has not established the plea is an abuse of process. I would not strike out the plea.
At the hearing of the applications the plaintiff complained about a plea in paragraph 30A of Annexure A to the third defence that he, while a bankrupt, breached s 911A of the Corporations Act 2001 (Cth) by offering financial services to clients of Orange Lane Finance. The plaintiff submits this allegation is unconnected to any plea by way of justification of the liar, fraud, accounting or unreliable and deceptive imputations. He submits that the plea is an attempt to create a basis for demands for discovery in circumstances they are remote from the real issues in the litigation.
The defendants submit that this plea is a direct response to the imputation pleaded by the plaintiff in the statement of claim that alleges that the plaintiff acted as a director of companies while a disqualified bankrupt.
I accept the defendants’ submission. The plaintiff has not established that the plea is an abuse of process. I would not strike out the plea.
Honest opinion and qualified privilege
At the hearing of the applications the plaintiff also sought to raise additional complaints in relation to the issues of honest opinion and qualified privilege.
The plaintiff complains about the pleas raised by the defendants in paragraph 53(a), (b), (e), (h) and (k) of Annexure A to the third defence. The basis of the complaint is that the pleas seek to rely upon matters that were unknown at the time of the broadcast. By way of example the defendants rely upon the plea in paragraph 53(k) in justifying one of the failure to account imputations. The plea is that the foundation continued to hold section 6 and section 7 licences until 31 December 2016. The plaintiff contends that the first four broadcasts occurred before 31 December 2016. Accordingly, this could not have been a matter known at the time of those broadcasts.
By way of response the defendants contend that these were matters known at the time of the broadcasts. They submit that the licences expired on 31 December 2016 but had been issued prior to the first broadcast. This is sufficient to dispose of the plaintiff’s submission concerning the plea in paragraph 53(k). The defendants submit that the other pleas were known at the time of the broadcasts. The plaintiff has not established otherwise. In the circumstances, the plaintiff has not established that the pleas in paragraph 53(a), (b), (e) and (h) of Annexure A to the third defence are an abuse of process. I would not strike out the pleas.
The plaintiff also complains about a plea in paragraph 89A of Annexure A of the third defence that the plaintiff could not be relied upon to ensure that employees of the foundation were paid their wage entitlements when they became due and payable. The plaintiff submits that whether the foundation, as a result of the defendants’ broadcast, was left in a position where it had outstanding liabilities to employees is a matter so remote to the real issues as to amount to an abuse of process. The defendants submit that it must prove that employees were not paid their entitlements when they were due and payable and that this fact is relevant to justify the imputation that the plaintiff is unreliable.
I accept the defendants’ submission. The plaintiff has not established that the plea is an abuse of process. I would not strike out the plea.
Conclusion
I would grant permission to the defendants to file and serve the fourth defence as exhibited to the fourth affidavit of Peter Campbell, sworn 18 May 2020 and marked PAC 23.
I would grant the plaintiff’s application to strike out paragraph 53B of Annexure A to the third defence, but otherwise dismiss the plaintiff’s strike-out application.
I would hear the parties as to costs.