Fraser v Business News Group Pty Ltd
[2018] VSC 196
•3 May 2018
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
MAJOR TORTS LIST
S CI 2016 03657
| TRENT FRASER | Plaintiff |
| v | |
| BUSINESS NEWS GROUP PTY LTD (ACN 606 324 403) | Defendant |
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JUDGE: | Daly AsJ |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 9 March 2018 |
DATE OF JUDGMENT: | 3 May 2018 |
CASE MAY BE CITED AS: | Fraser v Business News Group Pty Ltd |
MEDIUM NEUTRAL CITATION: | [2018] VSC 196 |
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DEFAMATION – Application for assessment of damages – Undefended – Interlocutory judgment entered for the defendant to pay the plaintiff damages to be assessed and costs fixed at $3,800 – Plaintiff sought $230,000 in damages for non-economic loss, including aggravated damages, and indemnity costs – Plaintiff alleged that defendant had published defamatory article headlined ‘Hotel Management CEO makes disastrous press blunder’ – Defamatory imputations made out – Consideration of factors relevant to assessment of damages – Defamation Act 2005 (Vic), ss 34 and 35 – Carson v John Fairfax & Sons Ltd (1993) 178 CLR 44, referred to – Vindication of plaintiff’s reputation – Not merely the breadth of the publication but the nature of the publication’s industry audience as a relevant consideration – ‘Grapevine effect’ – Distress and indignity suffered by plaintiff – Whether consideration of comparable cases in assessing whether an award of damages is appropriate, particularly where application is undefended – Rogers v Nationwide News Pty Ltd (2003) 216 CLR 327, referred to – Cerutti v Crestside Pty Ltd and anor [2014] QCA 33, referred to – Countervailing factors – Brief duration of publication – No sustained or malicious campaign of harassment by defendant – No direct evidence of actual harm to the plaintiff’s reputation – Wilson v Bauer Media Pty Ltd [2017] VSC 521, referred to – Sheales v The Age and Ors [2017] VSC 380, referred to – Manefield v Association of Quality Childcare Centres of NSW Inc [2010] NSWSC 1420, referred to – Dods v McDonald (No 2) [2016] VSC 201, referred to – Plaintiff awarded $150,000 in damages inclusive of aggravated damages – Indemnity costs not awarded as matters relied upon were relevant factors supporting an award of aggravated damages.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr D P Gilbertson QC | HWL Ebsworth |
| No appearance for or on behalf of the Defendant |
HER HONOUR:
Introduction
This ruling concerns an undefended assessment of damages in a defamation case issued on 8 September 2016 concerning a publication made by the defendant on 10 August 2016. The assessment arises out of an interlocutory judgment obtained by the plaintiff, Mr Trent Fraser on 11 October 2017, after the defendant failed to comply with self‑executing orders made by John Dixon J on 21 July 2017. The solicitors for the defendant were given leave to cease to act on the same day. The interlocutory judgment was that ‘the defendant pay the plaintiff damages to be assessed and costs fixed at $3,800’. The plaintiff submits that he should be awarded $230,000 in damages for non‑economic loss, including aggravated damages, and costs. He seeks the costs of the assessment of an indemnity basis.
The assessment of damages was originally listed before me on 5 February 2018 and was subsequently adjourned to 9 March 2018. I am satisfied by reason of the affidavit of service filed on behalf of the defendant that the defendant has been given notice of the assessment as provided by r 51.02 of the Supreme Court (General Civil Procedure) Rules 2015. The defendant did not appear or otherwise make submissions at the hearing of the assessment of damages.
As noted above, this proceeding was commenced on 8 September 2016. The plaintiff is and was at all relevant times, the Chief Executive Officer of Choice Hotels Asia-Pac Pty Ltd (‘Choice Hotels’), the Asia‑Pacific subsidiary of an American-based corporation. Choice Hotels manages hotels and short term accommodation facilities in Australia, New Zealand, Singapore, Malaysia, China and Thailand. The defendant, Business News Group Pty Ltd, is the owner and publisher of a website 9amnews.com.au, which I understand to be a subscription based news aggregating service targeted at operators in the hotel and tourism industries. According to the evidence, it largely republishes articles from the mainstream media of relevance to the industry, sometimes, as in the current case, with commentary of its own.
The plaintiff makes the following relevant allegations in his statement of claim:
On or about 10 August 2016, the defendant uploaded or caused to be uploaded to the website, an article with the headline, ‘Hotel Management CEO makes disastrous press blunder’, containing words and a picture of the plaintiff, following which the ‘article’ was downloaded and read by the readers of the website in Australia and was thereby published by the defendant.
4.In its natural and ordinary meaning the article was defamatory of the plaintiff and meant and was understood to mean that the plaintiff:
(a)is not a fit and proper person to be Hotel Management’s Chief Executive Officer;
(b)is incompetent as a chief executive officer of the Hotel Management Company in that he has not figured out a strategy to counter the susceptibility of the company’s franchise property owners to the threat posed to the business by Airbnb;
(c)is incompetent as a chief executive officer of a hotel management company in that he made a public blunder ‘he made to the media about the threat to the business posed by Airbnb’; and
(d)has caused disastrous consequences to the hotel management company he manages and/or its franchisees by making a public blunder in a quote he made to the media about the threat to the business posed by Airbnb.
In his statement of claim the plaintiff alleges that he had:
(a) been gravely injured in his feelings, credit and reputation;
(b) been humiliated, embarrassed and held up to hatred, ridicule and contempt; and
(c) suffered loss and damage.
The plaintiff also alleged that the defendant published the article knowing the imputations conveyed by the article to be false or, alternatively, was recklessly indifferent to their truth or falsity and without having made any or sufficient enquiries as to their truth or falsity. Further, the defendant has refused to publish an apology or correction, despite reasonable request, such that ‘the defendant has engaged in conduct that was improper, unjustifiable, lacking in bona fides, entitling the plaintiff to an award of aggravated damages’.
In its defence filed on 25 October 2016, the defendant admitted publication of the article and said that it removed the article from the website on 12 August 2016, some two days after the initial publication of the article. The defendant said further that the words of the plaintiff quoted in the article were taken from articles published in the Australian Financial Review (‘AFR’) on or about 1 August 2016. The defence also stated the article did not name the plaintiff, identify the business of which he was CEO or identify the AFR article in which he was named. The defence also denied that the defendant’s article identified the plaintiff or was defamatory of the plaintiff, but went on to allege that if the article was found to be defamatory of the plaintiff, the imputations conveyed by the article were said to be true, and thus the defendant had a defence of justification at common law and pursuant to s 25 of the Defamation Act 2005 (Vic) (‘Act’). The defendant also relied upon the statutory defence of honest opinion and qualified privilege.
In the particulars to paragraph 10 of the defence, which claimed that the imputations pleaded by the plaintiff were substantially true in substance and in fact, the defendant stated as follows:
PARTICULARS
On or before 1 August 2016, the plaintiff took part in an interview with a journalist from the Australian Financial Review. During the interview, in addition to making the statement set out in the Article, the plaintiff:
1.said ‘Vacation Rentals is one option we’re possibly looking at’ in the context of discussing the plaintiff’s strategy to compete with Airbnb;
2.said that there was no doubt Airbnb was having an impact on the hotel industry;
3.in that context, said ‘We remind our franchisees that our loyalty program is a real point of difference, as is our amazing service and the amenities we provide like restaurants, bars and gyms. This is something that is hard for the sharing economy to provide, but we could do a better job promoting these benefits.’
Making such a statement or statements was a public blunder and in making such a statement or statements to the press, the plaintiff had acted incompetently, because the statement or statements were made in the following circumstances:
1.The plaintiff is and was at all material times the chief executive officer of Choice Hotels Asia-Pac Pty Ltd (Choice).
2.Choice is one of the largest hotel franchisors in the Asia Pacific region.
3.Airbnb was founded in 2008 and is in the nature of an online market on which people can advertise (and in turn acquire) short-term rentals of private residential properties or rooms in such properties.
4.The existence of Airbnb:
a.represented since its inception and continues to represent a threat to the financial performance of hotel businesses; and
b.has had a negative impact on the financial performance of hotel businesses.
An amended defence was filed on 21 December 2016 which, among other things, admitted that ‘the article downloaded by one subscriber of the website, the identity of whom is not known by the defendant but, it is to be inferred, was the plaintiff or a person who provided the article to the plaintiff.’
Following the close of pleadings, the proceeding proceeded along the usual course with the parties making discovery and delivering answers to interrogatories. A dispute arose concerning the adequacy of the defendant’s answers to the plaintiff’s interrogatories and on 15 June 2017 Derham AsJ made orders that the defendant file and serve further and better answers to interrogatories. In the meantime, the matter had been set down for trial scheduled to commence on 16 April 2018. A mediation was held on 23 May 2017 but was unsuccessful. As previously noted, on 21 July 2017 John Dixon J made self‑executing orders. Since that time, the defendant has not participated in the proceeding at all.
At the hearing of the assessment of damages the plaintiff called three witnesses. The plaintiff gave evidence himself. Mr Richard Munro, the CEO of the Accommodation Association of Australia (‘Association’), the peak representative body for the accommodation industry in Australia, also gave evidence, as did Ms Jessica Nunns, who is the communications director for Cassette, a communications consultancy company who has worked with the plaintiff in a professional context.
The following documents were tendered into evidence:
(a) an AFR print article dated 1 August 2016 titled ‘Choice ponders Airbnb moves’;
(b) an AFR online article dated 1 August 2016 titled ‘Airbnb: Choice Hotels eyes up serviced apartment market’;
(c) a ‘9amgm.com.au Daily News’ online article dated 10 August 2016 titled ‘Hotel Management CEO makes disastrous press quote blunder’; and
(d) a letter from the plaintiff’s solicitors to the defendant dated 12 August 2016 (‘concerns notice’).
Each of the articles in evidence carried a photograph of the plaintiff. The text of the ‘9amgm.com.au Daily News’ article was as follows:
MELBOURNE: How much confidence can franchise property owners have in their hotel management Chief Executive Officer, who, upon being interviews about his strategy to counter their rising susceptibility to the Airbnb business threat say ‘We’ve not quite figured it out, but we have a couple of brands which play in that space [globally] and we feel we could offer something to serviced apartment owners.’
The concerns notice stated, among other things:
(a) the title of the article and the plaintiff’s photograph could be viewed upon a public search of the 9amnews.com.au website;
(b) the article was ‘false, misleading and defamatory’; and
(c) the plaintiff required the defendant to undertake to remove the article from the 9amnews.com.au website immediately, not republish the article, provide the plaintiff with a written apology, published on the 9amnews.com.au website, and circulated to the defendant’s subscribers, and to reimburse the plaintiff’s legal expenses.
The article was removed from the 9amnews.com.au website on 12 August 2016, the date of the concerns notice. However, the defendant did not publish an apology or retraction, and, in its amended defence, it stated that in a letter from its solicitors dated 25 August 2016, which is not in evidence, it offered to provide an apology similar to any apology obtained by the plaintiff from the AFR.
The plaintiff gave evidence that he was 48 years old, and he had been the CEO of Choice Hotels for six years, and prior to that, the development manager with Choice Hotels. Choice Hotels is the largest wholly owned subsidiary of Choice Hotels International, a publicly listed company in the US. Choice Hotels has 230 hotels throughout Australia, New Zealand, and parts of Asia, at different levels of the market, all operated by franchisees. Choice Hotels directly employs 80 people, and through its franchisees, approximately 5,000 people, and has an annual turnover of approximately $400 million.
The plaintiff gave evidence that after he finished school he completed a diploma of business studies at Canberra Institute of Technology, where he graduated as the most outstanding student in his course. He is married with a young family, which takes up much of his spare time.
The plaintiff was taken to the AFR article of 1 August 2016, which he said came about as a result of a press release Choice Hotels published concerning new hotels joining the group. He conducted a telephone interview with the journalist who wrote the AFR article, and he verified the accuracy of the statements attributed to him in the AFR article. The publication of the defendant’s article coincided with the annual conference Choice Hotels held with its franchisees, on this occasion in Hobart, Tasmania. The conference was attended by approximately 230 people. His immediate superior, who is based in Washington DC, was in attendance at the conference.
The plaintiff was taken to the two AFR articles: the content was substantially the same, although the text of the headlines differed. He explained that Choice International had a couple of US brands which could be brought into compete in the Australian serviced apartment market.
The plaintiff was also taken to the defendant’s article. He gave evidence that he knew the defendant published a widely read industry daily news distribution service. Choice Hotels has advertised on the defendant’s website for recruitment purposes. He believes the website has a quite targeted audience , typically hotel management companies, hotel managers, owners and operators, and while he is not subscriber, many of his staff and franchisees are subscribers.
The plaintiff gave evidence as to how he found out about the defendant’s article and his initial reaction to it. He received a text message from the General Manager of one of his Choice Hotels properties in the Melbourne CBD, Mr Tony Chakmar, to the effect that ‘Hey big guy, these guys got it wrong’. Mr Chakmar sent him the article later that day. He described his reaction as follows:[1]
Look, I was devastated. That’s nothing I’ve ever read or experienced before so – and that sort of moved quickly into anger I suppose, when I sort of understood the impact of it, felt the impact of it, and indeed that there’s a photo published at the same time.
[1]T19, 13-18.
The plaintiff gave evidence that he had not been contacted by the defendant prior to the publication of the defendant’s article, about which he was very disappointed. He considered the defendant’s article to be a personal attack upon him. When asked about the effect of the publication of the defendant’s article on his thinking about his capabilities as CEO of Choice Hotels, he gave the following evidence:[2]
Well, it makes you question your ability and – it makes you second guess, and dents your confidence absolutely for a period of time, and probably up until recently I’ve still felt that. So in all my time in the industry, I’ve never had any type of attack personally like this whatsoever. So that was why it was, you know, such a huge surprise and, you know, disappointment.
[2]T19, 26-31; T20, 1-3.
The plaintiff gave evidence that he had to discuss the defendant’s article with his senior team and other staff, and he believes that the defendant’s article was the subject of ‘water cooler’ conversations at the office, which made him feel uncomfortable and unnerved. He gave evidence that he had to explain to his senior staff the context in which the defendant’s article was published, as while not many of them would read the AFR, many would have read the defendant’s newsletter and website. He spoke to Mr Chakmar about the defendant’s article to express appreciation for his support. A franchisee representing a group of franchisees in Tasmania consulted his office expressing their concern about the defendant’s article. He had to discuss the defendant’s article with his supervisor, who was in Australia at the time of the publication of the defendant’s article and in the immediate aftermath. He also needed to discuss the defendant’s article with witnesses and potential witnesses for this proceeding, which was awkward and uncomfortable, and caused him embarrassment. His wife, like him, was disappointed and devastated about what was published, about him.
The plaintiff was asked about what he planned to do with any damages recovered from the defendant after reimbursement of Choice Hotels’ legal costs. The plaintiff told the Court that Choice Hotels has a relationship with the charity ‘Kids Under Cover’, which among other things, assists young people at risk of homelessness by building studio units in backyards of family homes to reduce the likelihood of at risk young people leaving home, and he planned to donate any surplus to this program.
The plaintiff gave evidence that he has not received any apology from the defendant, which has disappointed and frustrated him.
Mr Richard Munro, the CEO of the Association, also gave evidence. The Association is the peak body for the accommodation industry, representing thousands of businesses and properties across Australia.
Mr Munro gave evidence that he met Mr Fraser during an employee trainee program with Southern Pacific Hotel Corporation in the early 1990s. He has come across the plaintiff on a number of occasions through their different roles in the accommodation industry.
Mr Munro gave the following evidence concerning the plaintiff’s profile in the accommodation industry:[3]
And what types of people are they?---Well, Trent is actually a director on our board. So the board of directors for the Accommodation Association of Australia are a lot of the CEOs and presidents of large corporations, household brands that you'd know, such as Accor and Mantra and Best Western. So I have a – we meet probably three months, three times a year, I should say, and Trent is part of that collegiate group. And but I also have even, just last week I attended the Choice annual conference, where I think there was about 330 attendees, and you've got a cohort of suppliers and franchisees which are part of the Choice program. And so I get to, I guess, see directly the franchisees who are part of his – his direct network, and as well, Trent is well known, very well known in our industry as a leader, a senior leader. He is well respected. And I know a lot of people who aren't part of the Choice franchise who know of Trent as well. So Trent is very well known, I guess, in the inner circle of the Accommodation Association, the broader circle of Choice and the even bigger circle of the accommodation industry.
[3]T6, 1-20.
When asked about the plaintiff’s reputation in the accommodation industry, Mr Munro gave the following evidence:[4]
[4]T2, 15-31; T8, 1-28.
From the areas and circles in which you moved, of people who know Trent Fraser, what do you say his reputation was immediately prior to 10 August 2016 as a CEO of a hotel management company?---He – he was very – he's highly regarded, and I know that prior to that time we sought, actively sought Trent out for participation on our board, given his standing and reputation, and we were very pleased when he decided to come across, because we wanted people on our board who were leaders of industry, and Trent's reputation preceded him.
And from the areas and circles within which you've moved, of people who know Trent Fraser, what do you say his reputation was immediately prior to 10 August 2016 for competence as the CEO of a hotel management company?
---Yes, held in high regard. Just to give you some context about where we would meet with Trent and how important it is to have people of good standing, is that our work is a lot of meetings with senior ministers, up to the treasurer, prime minister, so federal ministers, state government ministers. We tend to work in that sort of circles, high profile people who we regard have influence on our industry, or on policies and outcomes. So Trent as part of our leadership group, represents thousands and thousands of businesses across our industry, and his reputation is second to none. And as I said, prior to 10 August 2016, we actively sought him out to participate in our leadership group, the directors, because of his excellent reputation.
Have you ever heard of his competence being called into question?---No, and I can tell you that – I can tell you too that even at the conferences, where I have been to others where they're part of a franchise group. There's usually some grumblings. You don't get that at Choice. It's a very seamless well-respected, well-regarded organisation. And sometimes there at other groups I've heard, and I attend all of their conferences, I would say it's the most professionally run conference and cohort of people that I've come across.
…
He doesn't have a reputation for causing disastrous consequences for Choice or its franchisees, does he?---Absolutely not.
Mr Munro has not read the defendant’s article. He does not subscribe to the defendant’s service, and while he does not consider the defendant’s website to be a highly regarded site, he believes it probably does have a lot of subscribers in the industry.
The final witness to give evidence was Ms Jessica Nunns. She is the communications director for Cassette, a communications consultancy providing graphic design, branding, marketing and public relations services. She is in charge of the public relations department. She has known the plaintiff since late 2011, when her former company had won the tender to provide public relations services for Choice Hotels , not long after the plaintiff had been appointed CEO. She has spoken to ‘plenty’ of people who know the plaintiff: she has seen his interactions with the media, and has worked with and dealt with Choice Hotels’ staff and franchisees. Ms Nunns gave evidence that she has not read the defendant’s article.
When questioned about the plaintiff’s reputation as the CEO of a hotel management company in the circles in which she moved prior to August 2016, Ms Nunns gave the following evidence:[5]
I would – I had no reason to think his reputation was anything other than excellent. The feedback that we had from various media when, you know, we were working with Trent to oversee interviews and commentary opportunities was excellent; we always had amazing feedback on Trent. Certainly we wouldn't have had the interest from people like Larry unless he was a highly knowledgeable authority on domestic tourism and travel, that's why we were sort of putting Trent forward to be an industry commentator. And certainly from the other sort of groups of people, when I had interaction with the franchisees they were highly positive about Trent. I've never heard a bad word spoken about him by any of his staff and I've, you know, dealt with multiple and different departments during that time when we worked together. And if I may go so far as to say because we were sort of appointed around the time when Trent's predecessor was leaving the role and Trent was stepping up, from what I could see, certainly amongst the industry and some of the industry media was there was a lot of excitement about Trent taking on that role.
And from the people that you mix with who know Mr Fraser, what do you say his reputation was at that time in terms of his competence as a CEO of a hotel management company?---Excellent. Excellent.
[5]T27, 25-31; T28, 1-18.
Submissions
Senior counsel for the plaintiff referred to the well-established principles governing claims for general damages for defamation, as stated by the High Court in Carson v John Fairfax & Sons (‘Carson’),[6] as applied in subsequent authorities, including decisions of this Court such as Wilson v Bauer Media Pty Ltd (‘Wilson’),[7] Sheales v The Age & Ors (‘Sheales’),[8] Dods v McDonald (‘Dods’),[9] and Belbin v Lower Murray Urban and Rural Water Corporation.[10]
[6](1993) 178 CLR 44.
[7][2017] VSC 521.
[8][2017] VSC 380.
[9][2016] VSC 201.
[10][2012] VSC 535.
In Carson,[11] the plurality stated as follows:
Specific economic loss and exemplary or punitive damages aside, there are three specific purposes to be served by damages, awarded for defamation. The three purposes no doubt overlap considerably in reality and ensure that ‘the amount of the verdict is the product of a mixture of inextricable considerations’. The three purposes are consolation for the personal distress and hurt caused to the appellant by the publication, reparation for the harm done to the appellant’s personal and (if relevant) business reputation and vindication of the appellant’s reputation. The first two purposes are frequently considered together and constitute consolation for the wrong done to the appellant. Vindication looks to the attitude of others to the appellant: the sum awarded must be at least the minimum necessary to signal to the public the vindication of the plaintiff’s reputation. ‘The gravity of the libel, the social standing of the parties and the availability of alternative remedies’ are all relevant to assessing the quantum of damages necessary to vindicate the appellant’
[11](1993) 178 CLR 44.
Further, s 34 of the Act provides as follows:[12]
In determining the amount of damages to be awarded in any defamation proceeding, the court is to ensure that there is an appropriate and rational relationship between the harm sustained by the plaintiff and the amount of damages awarded.
[12]Ibid, 60.
Senior counsel for the plaintiff submitted that each of the elements referred to by the High Court in Carson[13] are of significance to the current case.
[13](1993) 178 CLR 44.
Senior counsel for the plaintiff also referred to the elaboration of the principles in Carson[14] by John Dixon J in Wilson,[15] which can be condensed relevantly, as follows (omitting citations):[16]
[14]Ibid.
[15][2017] VSC 521, [59].
[16]Ibid.
(a) the assessment of general damages is necessarily imprecise and, accordingly, damages are ‘at large’ in the sense that they cannot be arrived at through calculation or the application of a formula;
(b) the sum awarded must demonstrate vindication of the plaintiff’s reputation, recognising the high value the law places upon reputation;
(c) the gravity of the libel and the social standing of the parties are relevant to assessing the quantum of damages necessary to vindicate the plaintiff;
(d) the extent of publication and seriousness of the defamatory sting are pertinent considerations;
(e) in determining the damage done to a plaintiff’s reputation, the Court should also take into account the ‘grapevine’ effect arising from the publication of the defamatory material;
(f) it is well accepted that injury to feelings may constitute a significant part of the harm sustained by a plaintiff, and for which a plaintiff is to be compensated by damages … Injured feelings include the hurt, anxiety, loss of self-esteem, sense of indignity, and the sense of outrage felt by the plaintiff;
(g) aggravated damages are a form of compensatory damages and, where appropriate, form part of general damages awarded to a successful plaintiff for non‑economic loss … An award of aggravated damages may be made if a defendant has acted in a manner which demonstrates a lack of bona fides or engaged in conduct which is otherwise improper or unjustifiable.
Senior counsel for the plaintiff submitted that I can infer that the defendant’s article was read by Choice Hotels’ staff and franchisees, and, given that the defendant provided a subscription service over the internet, I can infer that others also read the defendant’s article. There is also evidence of a ‘grapevine’ effect.
Senior counsel for the plaintiff submitted that the imputations referred to in the statement of claim are serious, being to the effect that the plaintiff is not a fit and proper person to be the CEO of a hotel management company, and that he is an incompetent CEO. He submitted that the need for vindication, or to ‘nail the lie’, is important in this case. The amount of damages awarded must be sufficient to ‘convince a bystander of the baselessness of the charge.’
In support of the plaintiff’s claim for aggravated damages, senior counsel for the plaintiff submitted that the extravagant language of the defendant’s article, in particular the reference to a ‘disastrous blunder’, the failure of the defendant to contact the plaintiff prior to publication of the defendant’s article, the erroneous context of the defendant’s article given that the plaintiff was not asked by the AFR about countering any threat posed by Airbnb, and the failure of the defendant to correct or apologise for the publication of the defendant’s article all supported an award for aggravated damages. Further, I can infer that the plaintiff was hurt or upset by the conduct of the defendant in pleading a defence of justification and then abandoning the proceeding.
In his review of recent relevant authorities, senior counsel for the plaintiff noted that in Wilson,[17] the actress Rebel Wilson was awarded $650,000 in general and aggravated damages, and in Sheales,[18] a barrister was awarded $175,000 for general and aggravated damages. He submitted that the imputations in the current case are more serious than in Sheales,[19] but not as serious as in Wilson,[20] such that an award of $230,000 is appropriate in all of the circumstances.
[17][2017] VSC 521.
[18][2017] VSC 380.
[19]Ibid.
[20][2017] VSC 521.
To the extent that it is necessary to do so, given that the proceeding is now undefended, I find that:
(a) the defendant’s article carried the imputations alleged by the plaintiff in his statement of claim; and
(b) those imputations were defamatory of the plaintiff.
In my view, an appropriate award is the sum of $150,000, including aggravated damages. Evaluating the plaintiff’s claim with regard to the considerations enumerated in Wilson,[21] as summarised in paragraph 37 above, I would make the following observations:
[21]Ibid.
(a) in regards to vindication of the plaintiff’s reputation, this is an important consideration in the current case. The plaintiff is the CEO of a substantial business in a key sector of the Australian economy, and represents other businesses in the industry in his role as a board member of the Association. Any attack on his professional competence and ability has the potential to cause substantial harm to the plaintiff’s reputation in the industry;
(b) while it is difficult to gauge the extent of publication given the withdrawal of the defendant from the proceeding, one can assume that the defendant’s website and subscription service has some following within the tourism and accommodation industry. Here, the relevant consideration is not so much the breadth of the publication, but the nature of the people who are likely to have read the publication, being operators in the industry in which the plaintiff occupies a senior position.[22] I also accept there is likely to have been a ‘grapevine effect’. A countervailing factor, however, is the duration of the publication, the defendant’s article having been removed from the defendant’s website two days after publication;
(c) the plaintiff gave evidence concerning the shock and discomfort he experienced as a result of reading the defendant’s article, and how his confidence had been shaken by the attack upon his confidence. He found the ‘damage control’ exercise he had to undertake after its publication to be awkward and discomforting. I have no doubt that the publication of the defendant’s article caused the plaintiff, who presents as a personable and capable man, and who appears to enjoy high esteem and respect within his chosen field of work, would have caused the plaintiff to suffer distress and indignity; and
(d) I agree this is an appropriate case for aggravated damages. The remarks made concerning what the plaintiff said during his interview with the AFR ignored the context in which those statements were made, and were gratuitous in the extreme. While there is no evidence before me as to precisely how the defendant responded to the plaintiff’s request for an apology, if the response was as was set out in the defendant’s defence,[23] it was a derisory response, given that the AFR article was not defamatory of the plaintiff. It is also relevant that the defendant pleaded a defence of justification in its defence, then abandoned the proceeding.
[22]See the statement of Brennan J in Reader’s Digest Services Proprietary Ltd v Lamb (1982) 150 CLR 500 at 507, that ‘In making its assessment, a jury is properly assisted by evidence that the making of the defamatory imputation … had an especially adverse impact upon the plaintiff’s reputation in the eyes or class in the community.’
[23]In paragraph 8 of the amended defence, the defendant admitted that it had not published an apology or retraction, but said that on 25 August 2016 it offered to provide an apology similar to any apology obtained by the plaintiff from the AFR.
That said, I consider that the amount claimed by the plaintiff to be excessive in all of the circumstances. In doing so, I have had regard to the decisions in a number of jurisdictions across Australia over the past ten years or so,[24] in addition to the authorities referred to me by senior counsel for the plaintiff. In doing so, I note the caution expressed by Hayne J concerning the Court engaging in a comparative exercise in Rogers v Nationwide News Pty Ltd,[25] while noting a possible qualification of that caution, as follows (omitting citations):[26]
Two of the three purposes served by an award of damages for defamation are to provide consolation to the person defamed for the personal distress and hurt which has been done, and reparation for the harm done to that person’s reputation. Necessarily, then, the amount awarded for defamation should reflect the effect which the particular defamation had on the individual plaintiff. It follows that the drawing of direct comparisons between particular cases is apt to mislead, just as the drawing of direct comparisons in personal injury cases can also mislead. Comparison assumes that there is sufficient identity between the effect which each defamation had on the particular plaintiff, whereas in fact circumstances alter cases. The amount allowed in each case should reflect the subjective effect of the defamation on the plaintiff. Unless that is recognised, the courts fall into ‘that form of the judicial process that Cardozo J deprecated, the mere matching of the colours of the case in hand against the colours of samples spread out upon a desk’. The consideration of other cases can yield no norm or standard derived from the amounts awarded in those other specific cases. Nonetheless, as Windeyer J said in relation to the assessment of damages for personal injuries:
‘Of course no two cases are exactly alike … One award is never really a precedent for another case. But we would I think be ignoring facts if we were to say that judges when asked to consider whether a particular verdict is beyond the bounds of reason – either excessive or inadequate – are unmindful of what was done in other cases, similar or dissimilar. If we were to say that, we would I consider deceive ourselves, as well as belie statements in judgments of high authority.’
[24]In particular, I reviewed selected cases involving alleged defamations in a professional context summarised in a table headed ‘Defamation case law analysis and statistics’ in the looseleaf service ‘Australian Defamation Law and Practice’, Lexis-Nexis, [60,510].
[25](2003) 216 CLR 327.
[26]Ibid, 350, [69].
In Cerutti v Crestside Pty Ltd and anor,[27] the Queensland Court of Appeal endorsed, while urging caution, consideration of comparable cases in local and interstate cases in assessing whether an award for damages is appropriate. In my view, the value of reviewing awards in comparable cases is greater in undefended matters, where there is no contradictor to respond to the submissions advanced on behalf of the plaintiff.
[27][2014] QCA 33, [46]-[49].
While of course each case is different (as made abundantly clear by my survey) my review was instructive in illustrating what features the current case does not have: there were no allegations of criminality, or dishonest conduct, which of course are more serious than the imputations conveyed by the defendant’s article. There was not a sustained and/or malicious campaign of harassment on the part of the defendant.[28] There was no direct evidence of any actual harm to the plaintiff’s reputation (albeit I accept that some harm is presumed).[29] Indeed, the evidence before me is that the plaintiff continues to enjoy an excellent reputation within the accommodation industry. While the defamation was a serious one, and made to an audience of a nature where the plaintiff’s reputation would be of particular importance, it was not so egregious as to warrant an award in excess of $200,000.
[28]See, for example, Cripps v Vakras [2014] VSC 279, Douglas v McLernon (No 4) [2016] WASC 320.
[29]Bristow v Adams [2012] NSWCA 166.
Of all of the authorities surveyed, the case perhaps closest on the facts to the current case is a proceeding in New South Wales, Manefield v Association of Quality Childcare Centres of NSW Inc.[30] In that case, a CEO of an industry association, who had been dismissed by the defendant over internal differences between him and the defendant’s board, successfully sued the defendant in respect of a letter sent by the defendant to its 650 members. The Court found the letter contained imputations that the plaintiff had used the confidential information of the defendant to establish a rival industry association, and that as CEO the plaintiff was responsible for the defendant’s financial and organisational difficulties. The Court held that the plaintiff’s reputation in the childcare industry had suffered greatly as a result, and awarded damages of $150,000. The similarities with the current case are, of course, that there was a limited, one-off publication, but to people who were active in the same industry as the plaintiff, such that any defamatory publication had the capacity to cause severe harm to the plaintiff’s reputation. I also note that the case was decided in 2010, when the cap imposed by the uniform defamation legislation was some eighty per cent of the cap that applies today. One could say that the ‘current value’ of that award, in relation to the level of the cap imposed by s 35 of the Act, is $187,500, nearly $40,000 more than what I propose to award the plaintiff upon this assessment.
[30][2010] NSWSC 1420 (upheld on appeal ]2012] NSWCA 123) where Beazley JA said: ‘In my opinion, his Honour’s award of damages was generous and at (but not beyond) the upper end of the range of compensatory (including aggravated) damages which could legitimately have been awarded in the circumstances. After all, the matter complained of had a significant impact upon the respondent and, it may be inferred … to his reputation as an honest and competent operator in the childcare business … His Honour was clearly impressed by the respondent as a witness and was entitled to accept his evidence as to hurt to his feelings and that his reputation has been damaged.’
However, there are significant differences between the current case and Manefield. First, in that case, the defendant was found to have been motivated to send the letter for the purpose of stifling lawful competition. Secondly, not only did the letter contain imputations that the plaintiff was incompetent, but that he was in breach of his contractual obligations with the defendant by misusing confidential information. Finally, the effect of the letter upon the plaintiff’s reputation was such that he was, in effect, drummed out of the childcare industry, a field he was passionate about, and did not work in the industry again. Accordingly, the professional consequences of the defamation upon the plaintiff in Manefield[31] were far more devastating than, fortunately, for the plaintiff in the current case. Further, to the extent that awards in comparable cases are instructive, I note that in Dods,[32] an award of $150,000 was made in circumstances where the defendant published statements to the effect that the plaintiff, a police officer, shot, killed and/or executed a teenage offender, albeit to a limited audience. Bell J described the defamation as ‘shocking in the extreme’.[33]
[31][2010] NSWSC 1420.
[32][2016] VSC 201.
[33]Ibid, [72].
In Sheales,[34] an award of $175,000 was made in favour of a barrister in circumstances where an allegation was made in a major metropolitan newspaper that he had made a negligent misstatement to Racing Victoria concerning a controversial matter. Senior counsel for the plaintiff in this case submitted that this was a less serious defamation than the current case: this is debatable, given the extent of publication, and the statement of John Dixon J that the publication was an ‘unwarranted personal attack on his competency as a barrister.’[35]
[34][2017] VSC 380.
[35]Ibid, [92].
Senior counsel submitted that the plaintiff ought receive an order for indemnity costs of the assessment, on the basis of the manner in which the defendant has conducted its case: that is, by pleading a defence of justification, and abandoning it. Further, the plaintiff relied upon the circumstances in which the defendant’s article was published as justifying an award for indemnity costs.
It is not necessary for present purposes to consider in any detail the circumstances in which the Court may make an award of indemnity costs. For present purposes, it is sufficient to say that the matters relied upon above have been taken into account in awarding damages, and do not warrant additional compensation through an award of indemnity costs.
Accordingly, I will make the following orders:
(a) the defendant pay the plaintiff the sum of $150,000;
(b) the defendant pay the plaintiff’s costs of the assessment on a standard basis, to be taxed in default of agreement; and
(c) the proceeding be otherwise dismissed.
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