Gacic v John Fairfax Publications Pty Ltd

[2015] NSWCA 99

Court of Appeal

Supreme Court

New South Wales

• Summary available
• Amendment notes

Medium Neutral Citation:

Gacic v John Fairfax Publications Pty Ltd [2015] NSWCA 99

Hearing dates:

29 September 2014

Date of orders:

16 April 2015

Decision date:

16 April 2015

Before:

McColl JA at [1]; Macfarlan JA at [214]; Barrett JA at [230]

Decision:

(1)   Appeal allowed.
(2)   Cross-appeal allowed.
(3)   Set aside the judgments at first instance on damages and interest.
(4)   Judgment to be entered in favour of each appellant in an amount to be determined in accordance with the Court’s reasons.
(5)   Note that that component of each judgment calculated in respect of the sum of $175,000 takes effect as of 18 December 2009.
(6)   Note that that component of each judgment calculated in respect of the sum of $20,000 takes effect as of 22 June 2012.
(7)   If the parties are able to agree as to the amount of the judgments (inclusive of interest) to be entered in accordance with these reasons for judgment, direct that within 7 days they file a form of consent order in the Court of Appeal Registry.
(8)   If the parties are unable to so agree, direct that they file proposed forms of orders and submissions in support as follows:
   (a)   The appellants within 14 days of the date    of this judgment
   (b)   The respondents within 14 days thereafter
   (c)   Any reply within a further 7 days.
(9)   Respondents to pay the appellants' costs of the appeal.
(10)   Appellants to pay the respondents' costs of the cross-appeal.

Catchwords:

DEFAMATION – respondents found to have published review defamatory of appellants’ conduct as restaurateurs in relation to two restaurants they conducted – assessment of damages – aggravated damages – whether primary judge awarded the appellants amounts referrable to the hurt to feelings occasioned by the respondents failure to apologise and the falsity of the imputations – 

DEFAMATION – assessment of damages – exemplary damages – first respondent continued to publish restaurant review on its website after Court of Appeal held its defences to appellants’ defamation suit had failed – whether first respondent acted in contumelious disregard of appellants’ rights – 

DEFAMATION – assessment of damages – compensatory damages – adequacy – 

DEFAMATION – assessment of damages – mitigation – reputation – whether facts established in relation to meals reviewer ate at one of appellants’ restaurants constituted contextual background relevant to the appellants’ reputations – whether and to what extent such facts mitigated the appellants’ damages – 
JUDGMENTS – interest on judgment – whether damages judgment should take effect on date earlier than date on which given – Uniform Civil Procedure Rules 36.4

Legislation Cited:

Civil Liability Act 2002 (NSW)
Civil Procedure Act 2005 (NSW)
Defamation Act 1974 (NSW)
Motor Accidents Compensation Act 1999 (NSW)
Supreme Court Act 1970 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

Ali v Nationwide News Pty Ltd [2008] NSWCA 183
Amalgamated Television Services Pty Ltd v Marsden [2002] NSWCA 419
Australian Broadcasting Corp (ABC) v McBride [2001] NSWCA 322; (2001) 53 NSWLR 430
Australian Broadcasting Corporation v O’Neill [2006] HCA 46; (2006) 227 CLR 57
Burstein v Times Newspapers Ltd [2000] EWCA Civ 338; [2000] 2 All ER 2384; [2001] 1 WLR 579
Cairns v Modi [2012] EWCA Civ 1382; [2013] 1 WLR 1015
Carson v John Fairfax & Sons Limited [1993] HCA 31; (1993) 178 CLR 44
Cassell & Co Ltd v Broome [1972] AC 1027
Channel Seven Adelaide Pty Ltd v Manock [2007] HCA 60; (2007) 231 CLR 245
Channel Seven Sydney Pty Ltd v Mahommed [2010] NSWCA 335; (2010) 278 ALR 232
Clyne v Deputy Commissioner of Taxation [1984] HCA 44; (1984) 154 CLR 589
Cohen v Mirror Newspapers Ltd [1971] 1 NSWLR 623
Convery v The Irish News Limited [2008] NICA 14
Crampton v Nugawela (1996) 41 NSWLR 176
Dow Jones & Company Inc. v Gutnick [2002] HCA 56; (2002) 210 CLR 575
Gacic v John Fairfax Publications Pty Ltd [2013] NSWSC 1920
Gacic v John Fairfax Publications Pty Ltd [2011] NSWCA 362
Gacic v John Fairfax Publications Pty Ltd [2009] NSWSC 1403
Gacic v John Fairfax Publications Pty Ltd [2006] NSWCA 175; (2006) NSWLR 675
Gacic v John Fairfax Publications Pty Ltd (No 2) [2014] NSWSC 738
Goldsborough v John Fairfax & Sons Ltd [1934] NSWStRp 43; (1934) 34 SR(NSW) 524
Government Insurance Office (NSW) v Healy (No 2) (1991) 22 NSWLR 380
Gray v Motor Accident Commission [1998] HCA 70; (1998) 196 CLR 1
Habib v Nationwide News Ltd [2010] NSWSC 924
Harmer v Hare (No 2) [2012] NSWCA 58
Hartley Poynton Ltd v Ali [2005] VSCA 53; (2005) 11 VR 568
Holt v TCN Channel Nine Pty Ltd [2014] NSWCA 90; (2014) 86 NSWLR
John Fairfax Publications Pty Ltd v Gacic & Ors [2012] HCAT Trans 168
John Fairfax Publications Pty Ltd v Gacic [2007] HCA 28; (2007) 230 CLR 291
John Fairfax Publications Pty Ltd v Zunter [2006] NSWCA 227
Kardos v Sarbutt (No 2) [2006] NSWCA 206
L Shaddock & Associates Pty Ltd v Parramatta City Council (No 2) [1982] HCA 59; (1982) 151 CLR 590
Lamb v Cotogno [1987] HCA 47; (1987) 164 CLR 1
Ley v Hamilton (1935) 153 LT 384
Marsden v Amalgamated Television Services Pty Ltd [2001] NSWSC 510
McLean v David Syme & Co Ltd (1970) 72 SR (NSW) 513
Moit v Bristow [2005] NSWCA 322
Moran v McMahon (1985) 3 NSWLR 700
Nicholson v Nicholson [1988] HCA 48; (1988) 165 CLR 306
Nicol v Allyacht Spars Pty Ltd (No 2) [1988] HCA 48; (1988) 165 CLR 306
O’Hagan v Nationwide News Pty Ltd [2001] NSWCA 302; (2001) 53 NSWLR 89
Pamplin v Express Newspaper Ltd [1988] 1 WLR 116
Re Media Entertainment & Arts Alliance; ex parte Hoyts Corporation Pty Ltd (No 2) [1994] HCA 66; (1994) 68 ALJR 179
Rogers v Nationwide News Pty Ltd [2003] HCA 52; (2003) 216 CLR 327
Rookes v Barnard [1964] AC 1129
Scott v Sampson [1882] 8 QBD 491
Simpson v MGN Ltd [2015] EWHC 77
Singleton v French (1986) 5 NSWLR 425
State of New South Wales v IG Index plc & Ors [2007] VSCA 212; (2007) 17 VR 87
TCN Channel Nine Pty Ltd v Anning [2002] NSWCA 82; 54 NSWLR 333
Triggell v Pheeney [1951] HCA 23; (1951) 82 CLR 497
Turner v News Group Newspapers Ltd [2006] EWCA Civ 540; [2006] 4 All ER 613; (2006) 1 WLR
Uren v John Fairfax & Sons Pty Ltd [1966] HCA 40; (1966) 117 CLR 118
Warren v Random House Group Ltd [2008] EWCA Civ 834; [2009] QB 600
Waterhouse v Broadcasting Station 2GB Pty Ltd (1985) 1 NSWLR 58
Whitfield v De Lauret & Co Ltd [1920] HCA 75; 29 CLR 71

Texts Cited:

Australian Defamation Law and Practice (LexisNexis)
Gatley on Libel and Slander, 11th ed (2008) Sweet & Maxwell
McGregor on Damages, 18th ed (2009) Sweet & Maxwell
Silencing John Doe: Defamation and Discourse in Cyberspace (2000) 49 Duke Law Journal 855

Category:

Principal judgment

Parties:

Aleksandra Gacic (First Appellant)
Ljiljana Gacic (Second Appellant)
Branislav Ciric (Third Appellant)
John Fairfax Publications Pty Ltd (First Respondent)
Matthew Evans (Second Respondent)

Representation:

Counsel:
CA Evatt, with R Rasmussen and C Dibb (Appellants)
T Blackburn SC and DR Sibtain (Respondents)

Solicitors:
David Leamey (Appellants)
Banki Haddock Fiora (Respondents)

File Number(s):

2013/385955

Publication restriction:

No

 Decision under appeal 

Court or tribunal:

Supreme Court of New South Wales

Jurisdiction:

Common Law

Citation:

[2013] NSWSC 1920

Date of Decision:

19 December 2013

Before:

Hall J

File Number(s):

2004/176936

HEADNOTE

[This headnote is not to be read as part of the judgment

On 30 September 2003 the respondents, John Fairfax Publications Pty Ltd and Matthew Evans, published a review concerning CocoRoco, an establishment conducted by the appellants, Aleksandra Gacic, Ljiljana Gacic and Branislav Ciric. After a trial before a jury pursuant to s 7A of the Defamation Act 1974 (NSW) (the “1974 Act”) and two appeals (one to the High Court), the appellants established that the review conveyed three defamatory imputations of and concerning each of them. The matter then proceeded to trial before Harrison J who entered a verdict for the respondents on 18 December 2009. (the “liability judgment”). The Court of Appeal upheld the appellants’ appeal from that judgment. It entered a verdict for the appellants and remitted the matter to the Common Law Division for assessment of damages. The respondents were unsuccessful in their application for special leave to appeal against the Court of Appeal decision.

His Honour Justice Hall conducted the damages hearing pursuant to the Court of Appeal’s remitter order. In his first judgment, his Honour entered judgment in favour of each of the three appellants in the amount of $160,000 plus interest. In his second judgment his Honour dealt with matters of costs and interest.

On appeal, the appellants complained that the primary judge’s award of damages was inadequate. They also claimed that his Honour erred by not backdating his judgment to 18 December 2009, the date of Harrison J’s judgment. By way of cross-appeal, the respondents complained that the primary judge’s award was excessive because, they contended, his Honour erred in his consideration of their plea in mitigation of damages.

The principal issues on the appeal were whether the primary judge erred:

(1)   in taking into account, or misapplied, s 46A of the 1974 Act in his assessment of damages;

(2)   in not awarding exemplary damages;

(3)   in his award of aggravated damages in failing to take into account the respondents’ failure to apologise and the falsity of the imputations;

(4)   in his award of compensatory damages;

(5)   in not back dating interest on the amount of damages awarded at court rates to the date of the liability judgment.

The issues on the cross-appeal were whether the primary judge erred:

(1)   In holding that findings in the liability judgment did not establish facts relevant to the cross-respondents’ reputations and the contextual background as at the date of publication of the review;

(2)   In holding that findings in the liability judgment were “post-publication” findings not relevant to the assessment of damages; and

(3)   In holding that the statements of Mr Evans in the review and in evidence in the liability proceedings as to the quality of the food and service at Coco were statements of opinion, and evidence of his opinion, and that there were no statements of fact and evidence of facts relevant to the assessment of damages.

Held, allowing the appeal and the cross-appeal (and increasing the appellants’ damages to $195,000 to date from 18 December 2009 as to part and from 22 June 2012 insofar as exemplary damages are concerned):

The appeal:

As to issues (1), (3) and (5):

(by McColl JA, Macfarlan and Barrett JJA agreeing):

(1)   The primary judge did not err in his consideration, or application, of s 46A of the 1974 Act;

(2)   The primary judge erred in his award of aggravated damages in failing to take into account the respondents’ failure to apologise and the falsity of the imputations;

(3)   The appellants’ compensatory damages should be increased by $20,000 to allow for these claims.

(4)   The primary judge erred in not back dating interest on the amount of damages awarded at court rates to the date of the liability judgment.

As to issue (2)

(by Barrett JA, McColl JA and Macfarlan JA agreeing)

(1)   The primary judge erred in failing to order the first respondent to pay the appellants exemplary damages in respect of the continuing publication of the review on its website after 22 June 2012;

(2)   The appellants’ damages should be increased by an award of exemplary damages in the amount of $20,000.

The cross-appeal

(by McColl JA, Macfarlan and Barrett JJA agreeing):

(1)   The primary judge erred in failing to conclude that certain of Mr Evans’ statements were statements of facts which were relevant to the appellants’ reputations and the contextual background as at the date of publication of the review;

Burstein v Times Newspapers Ltd [2000] 2 All ER 2384 [2001] WLR 579 applied;

Holt v TCN Channel Nine Pty Ltd [2014] NSWCA 90; (2014) 86 NSWLR; Pamplin v Express Newspaper Ltd [1988] 1 All ER 282; [1988] 1 WLR 116 discussed

(by McColl JA, Barrett JA agreeing):

(2)   The appellants’ damages should be reduced by $5,000 by reason of the mitigation factors.

(by Macfarlan JA)

(3)   The appellants’ damages should be reduced by $70,000 by reason of the mitigation factors.

**********

INDEX

Background

Legislative framework

Primary Judgment

A The mitigation defence

A1 Whether “findings” operate as post-judgment findings

A2 Facts v Opinion

B Assessment of Damages

C Compensatory Damages

D Aggravated Damages

E Exemplary Damages

The Costs Judgment

Issues on appeal

The appeal

Section 46A (Grounds 3 and 4)

Section 46A – determination

Exemplary damages (Ground 2)

Exemplary damages – determination

Aggravated Damages (Ground 5)

Aggravated Damages – determination

A. Failure to apologise

B. Falsity of the imputations

Compensatory Damages (Grounds 1 and 6)

Compensatory damages: determination

Backdating of interest (Grounds 7 – 9)

Backdating of interest – determination

The cross-appeal: submissions

The cross-appeal: determination

Mitigation: Facts or opinion

Nature of Harrison J’s findings

Mitigation: evidence properly before the court on some other issue

Re-assessing damages

Orders

Appendix 1 – Matter complained of

Appendix 2 – Schedule of Evidence

The cross-appeal – mitigation of damages

Conclusions

Judgment

1. McCOLL JA:    Aleksandra Gacic, Ljiljana Gacic and Branislav Ciric, the appellants, appeal against a decision of Hall J in the Common Law Division of the Supreme Court, in which his Honour awarded each appellant $207, 842.19 ($160,000 plus interest) in damages for a defamatory restaurant review concerning the establishment, Coco Roco, published by the respondents, John Fairfax Publications Pty Ltd and Matthew Evans. [1]

   1. Gacic v John Fairfax Publications Pty Ltd [2013] NSWSC 1920 (the “primary judgment”).

Background

2. The review was written by the second respondent, Matthew Evans, and published by the first respondent, John Fairfax Publications Pty Ltd on 30 September 2003. [2] After a trial before a jury pursuant to s 7A of the Defamation Act 1974 (NSW) (the “1974 Act”) and two appeals,[3] the appellants established that the review conveyed the following defamatory imputations :

1. The appellants sell unpalatable food at Coco Roco (the “first imputation”);

2. The appellants provide some bad service at Coco Roco (the “second imputation”);

3. The third appellant is incompetent as a restaurant owner because he employed a chef at Coco Roco who makes poor quality food (the “third imputation”);

   2.    The review is Appendix 1 to these reasons.

   3. Gacic v John Fairfax Publications Pty Ltd [2006] NSWCA 175; (2006) NSWLR 675; John Fairfax Publications Pty Ltd v Gacic [2007] HCA 28; (2007) 230 CLR 291.

3. The matter then proceeded to trial before Harrison J who entered a verdict for the respondents on 18 December 2009. [4]

   4. Gacic v John Fairfax Publications Pty Ltd [2009] NSWSC 1403 (the “liability hearing”).

4. The Court of Appeal upheld the appellants’ appeal from Harrison J’s judgment. [5] It entered a verdict for the appellants and remitted the matter to the Common Law Division for assessment of damages. The respondents were unsuccessful in their application for special leave to appeal against the Court of Appeal decision. [6]

   5. Gacic v John Fairfax Publications Pty Ltd [2011] NSWCA 362 (the “Court of Appeal judgment”).

   6.    John Fairfax Publications Pty Ltd v Gacic & Ors [2012] HCAT Trans 168.

5. The primary judge conducted the damages hearing pursuant to the Court of Appeal’s remitter order. His Honour delivered judgment on 19 December 2013 entering judgment in favour of each of the three appellants for the amounts to which I have referred. On 6 June 2014 his Honour delivered a judgment dealing with costs and interest. [7]

   7. Gacic v John Fairfax Publications Pty Ltd (No 2) [2014] NSWSC 738 (the “Costs Judgment”).

6. The appellants complain that the primary judge’s award of damages was inadequate. They also claim his Honour erred by not backdating his judgment to 18 December 2009, the date of Harrison J’s judgment. The respondents complain the primary judge’s award was excessive because, they contend, his Honour erred in his consideration of a plea in mitigation of damages he gave them leave to advance in the course of the damages hearing.

7. For the reasons that follow, I am of the view that both parties have had a measure of success in their contentions and that the appellants’ damages should be re-assessed. Neither party objected to this Court undertaking that exercise should it reach the conclusion that re-assessment was required.

Legislative framework

8. The action was governed by the 1974 Act which relevantly provided insofar as the assessment of damages was concerned:

“46 General

(1) In this part ‘relevant harm’ means, in relation to damages for defamation:

(a) harm suffered by the person defamed …

(b) ...

(2) Damages for defamation shall be the damages recoverable in accordance with the common law, but limited to damages for relevant harm.

(3) In particular, damages for defamation:

(a) shall not include exemplary damages, and

(b) shall not be affected by the malice or other state of mind of the publisher at the time of the publication complained of or at any other time, except as far as that malice or other state of mind affects the relevant harm.”

46A Factors relevant in damages assessment

(1) In determining the amount of damages to be awarded in any proceedings for defamation, the court is to ensure that there is an appropriate and rational relationship between the relevant harm and the amount of damages awarded.

(2) In determining the amount of damages for non-economic loss to be awarded in any proceedings for defamation, the court is to take into consideration the general range of damages for non-economic loss in personal injury awards in the State (including awards made under, or in accordance with, any statute regulating the award of any such damages).”

9. Two of the appellants’ grounds of appeal concern their application for the backdating of the judgment. In that respect, s 101 of the Civil Procedure Act2005 (NSW) relevantly provides:

“(1) Unless the court orders otherwise, interest is payable on so much of the amount of a judgment (exclusive of any order for costs) as is from time to time unpaid.

(2) Interest under subsection (1) is to be calculated, at the prescribed rate or at such other rate as the court may order, as from:

(a) the date on which the judgment takes effect …”

10. Uniform Civil Procedure Rules 2005 (“UCPR”) 36.4 provides:

“36.4 Date of effect of judgments and orders

(cf SCR Part 40, rule 3; DCR Part 31, rule 13A (2))

(1) A judgment or order takes effect:

(a) as of the date on which it is given or made, or

(b) if the court orders that it not take effect until it is entered, as of the date on which it is entered.

(2) Despite subrule (1), if an order of the court directs the payment of costs, and the costs are to be assessed, the order takes effect as of the date when the relevant cost assessor’s certificate is filed.

(3) Despite subrules (1) and (2), the court may order that a judgment or order is to take effect as of a date earlier or later than the date fixed by those subrules.”

Primary Judgment

11. The background was set out in the Court of Appeal judgment (in turn cross-referenced to Harrison J’s findings) as follows:

“[19]   Coco Roco was a harbourside establishment on two levels with two dining options: a bistro downstairs called ‘Roco’ and a more expensive restaurant upstairs called ‘Coco’. There was a kitchen on each level (at [27]). The third appellant, Branislav Ciric, conceived of the concept for Coco Roco during 2002 (at [40]).

[20]   The first and second appellants, Aleksandra and Ljiljana Gacic, are sisters. The third appellant, Mr Ciric, is married to Ljiljana Gacic. They established two companies, Coro Enterprises Pty Ltd t/as Coco Roco and Syd Mirror Pty Ltd which became, respectively, the owner of the restaurant business and the lessee of the premises from which the Coco and Roco restaurants were operated (at [40]). The appellants were directors and/or shareholders of those companies (at [7]).

[21]   In the three or so weeks preceding the official launch of Coco Roco, ‘soft openings’ were held on some days for lunch and/or dinner (at [42], [147] – [148]). Coco Roco was officially launched with a function in aid of the National Breast Cancer Foundation on Friday, 4 September 2003 (at [3]). The publicity agent retained by the appellants invited Mr Evans, who had been The Sydney Morning Herald’s chief restaurant reviewer since early 2001, to the launch (at [110]). He did not attend (at [3], [5]).

[22]   The day following the opening, Mr Evans ate lunch at Coco with a companion. He subsequently ate dinner at Coco with another companion on Wednesday, 10 September 2003. The review, published on Tuesday, 30 September 2003, included his impression of both dining experiences. Mr Evans never ate at Roco (at [6]).

[23]   The review was published in Good Living. The glossy coloured front page contained a teaser at its foot, ‘Matthew Evans fails Coco Roco’. …

[24]   The review came to the attention of the appellants on the day of its publication. They were ‘shocked and distressed’ (at [7]). An apology was sought from the respondents in October 2003, but was not forthcoming (at [21]).

[25]   Coco Roco suffered a decline in patronage, and ultimately closed permanently in early 2004. An administrator was appointed to both Syd Mirror and Coro in March 2004. The primary judge accepted that each appellant had been ‘very badly affected’ by the failure of Coco Roco, and that each appellant attributed its failure to the review (at [235] – [236]).”

12. The damages hearing proceeded upon the basis that the transcript of the evidence in the liability hearing formed part of the proceedings remitted by the Court of Appeal. [8] Each appellant also gave evidence which supplemented the evidence they had given. They called three other witnesses. The respondents relied on the evidence they had called at the liability hearing.

    8.    Primary judgment (at [20]).

A   The mitigation defence

13. On the third day of the damages hearing, the respondents obtained leave to amend the defence to plead, in mitigation of damages, that any damage that the appellants had suffered should be reduced because of the truth of matters pleaded in support of their defences of truth and comment.

14. In support of that plea, the respondents relied upon facts concerning the second respondent’s experiences when he dined at “Coco” they contended they established at the liability hearing in succeeding in their defence of truth with respect to the second imputation in relation to each appellant and the third imputation with respect to the third appellant. They also relied upon facts they contended Harrison J had expressly or implicitly found to be established in holding that they had established the defence of comment with respect to all three imputations in the case of each appellant. They contended his Honour should be found to have implicitly made the findings of fact on which they had relied to support their defence of comment to which their plea in mitigation was cross-referenced.

15. Although Harrison J’s verdict was overturned on appeal, the respondents submitted at the damages hearing that the Court of Appeal had not interfered with his factual findings. Accordingly, they contended the primary judge should have regard to the facts found by Harrison J to conclude that the appellants’ reputations as restaurateurs had been justifiably tarnished at the time the review was published in such a manner as would substantially mitigate any damages to which they were entitled.

16. The primary judge described the defence of mitigation as the centrepiece of the respondents’ case on damages. [9] They relied upon a number of propositions to support it which the primary judge summarised [10] as including:

“●   That Harrison J had made factual findings as to Mr Evans’ low opinion of the food consumed at the restaurant Coco;

●   Those ‘findings’ regarding the food at Coco having been made, the published conclusions of Mr Evans must have done damage to the plaintiffs as restaurateurs, but justifiably. What remains of their reputation as restaurateurs is limited: Defendants’ Further Submissions, 30 January 2013 at 1(a) and 1(c);

●   The review published to each reader ‘true facts’ about Mr Evans' dining experience at the "fine dining" restaurant, Coco: Defendants' Closing Submissions on Damages, 25 February 2013 at [3]. It was there again stated: ‘The publication of his experiences at Coco must have done significant damage to the reputation of the plaintiffs’. This statement was followed by the submission: ‘In the assessment of damages, the Court would have regard to that fact, and would discount the damages to be awarded accordingly.’

●   The critical issue is whether Mr Evans’ ‘observations’ as an experienced food reviewer were correct. There was no challenge to his credit. Accordingly, they must be accepted: Defendants' Closing Submissions on Damages, 25 February 2013 at [17];

●   The review on its face is explicitly a review of ‘the reviewer's experiences’ at Coco. The context, and explicit content of the review, informs the assessment of damages: Defendants' Closing Submissions on Damages at [24].”

9.    Primary judgment (at [51]).

10.    Primary judgment (at [62]).

17. The primary judge explained the respondents’ argument as follows:

“[63]…first, the review, though defaming the [appellants], established ‘facts’ as to the quality of the food and service at Coco. The publication of the defamatory review by the [respondents] of those ‘facts’ must have significantly damaged the [appellants’] reputations. Second, Harrison J’s ‘findings’ established ‘facts’ concerning both the quality of the food served at Coco and the service at that restaurant. Those ‘facts’ and ‘findings’ are to be taken into account as they diminish the [appellants’] claims for damages.”

18. The primary judge described the mitigation defence as an “unusual line of argument” [11] whereby the “review of the Coco restaurant, notwithstanding its defamatory nature, was relied upon by the defendants as having had a significant and public impact upon the plaintiffs’ reputation as restaurateurs to the extent that its effect upon them was to ‘devastate’ their reputation. Such a devastating effect, the defendants contended, in effect, operated or worked in their favour in the assessment of damages”. [12]

    11.    Primary judgment (at [70]).

    12.    Primary judgment (at [68]).

19. His Honour then said:

“[69]   The defendants’ submission in practical terms rests upon an assumption. It is that, notwithstanding that the review written by the second defendant was defamatory as the Court of Appeal determined, in the assessment of the damages for the harm it occasioned to each of the three plaintiffs, the defendants nonetheless should have the benefit, in terms of mitigation, of the fact that the review ‘devastate(d)’ their reputations.” (Emphasis in original)

20. The appellants disputed the validity of the respondents’ submission, contending [13] that:

“(1) Any findings made by Harrison J, being ‘findings’ in the very proceedings in which the plaintiffs claim damages for harm to and vindication of their respective reputations, are not evidence in the present proceedings. Further, such ‘findings’ had no notoriety until his Honour’s judgment was delivered;

(2) In any event, the statements contained in the review were not statements of fact. They are/were statements of opinion;

(3) Further, there were no ‘findings’ of fact made by Harrison J in relation to the article on the quality of the food or the service based on his two attendances at the Coco restaurant.” (Emphasis in original)

13.    Primary judgment (at [70]).

21. The primary judge [14] identified the following issues as relevant for determination of the issue:

1. “Whether any ‘findings’ of Harrison J may be considered as post-judgment findings of a court that relate to reputation.

2. Whether the statements of [the second respondent] in the review, on the quality of the food served at Coco and as to the service, were statements of fact or of opinion about those matters;

3. Whether the ‘findings’ made by Harrison J, however, characterised, may be regarded as constituting post-publication findings that diminish the plaintiffs’ reputations.

   14.    Primary judgment (at [66]).

A1   Whether “findings” operate as post-judgment findings

22. The primary judge noted at the outset of his consideration of this issue that the “‘findings’ of Harrison J as to the quality of the food and the service at the Coco restaurant, if they be as such, were made on 18 December 2009, the date of his Honour's judgment, that is a little over six years after the date of publication of the review.” [15]

    15.    Primary judgment (at [73]).

23. His Honour applied Amalgamated Television Services Pty Ltd v Marsden [16] to hold that adverse findings “made in the very proceedings in which damages were to be assessed could not be used for purposes in which the plaintiff claims damages.” [17]

    16. [2002] NSWCA 419 (at [1396]) (“Marsden CA”).

    17.    See his Honour’s consideration of the issue (at [74] – [85]).

24. The primary judge concluded that the post-publication “findings” did not fall within the category of cases involving evidence of events going to diminish reputation occurring after the publication of defamatory matters. They were not “evidence of bad reputation of the plaintiffs”. Accordingly they could not be used to diminish the plaintiffs’ reputation as they were made after publication of the defamatory matter and in a judgment in the present proceedings.” [18] In any event, his Honour found Harrison J’s findings were not “factual”. [19]

    18.    Primary judgment (at [84]).

    19.    Primary judgment (at [85]).

A2   Facts v Opinion

25. The primary judge then considered the respondents’ submissions that Harrison J’s findings should be characterised as findings of fact rather than, as the appellants contended, only matters of opinion. [20]

    20.    (at [86]ff).

26. The primary judge accepted the appellants’ submission, applying Convery v The Irish News Limited, [21] that the post-publication findings could only be matters of opinion, not fact. [22]

    21.    [2008] NICA 14 (Court of Appeal in Northern Ireland; Kerr LCJ, Campbell LJ and Gervan LJ).

    22.    Primary judgment (at [100]).

27. Although that conclusion was a sufficient answer to the respondents’ submissions on mitigation, his Honour considered two cases on which they relied, Pamplin v Express Newspaper Ltd  [23] and Burstein v Times Newspapers Ltd [24] in order to examine “the juridical basis for the mitigation of damages principle in defamation proceedings and the circumstances that determined its scope and application.” [25] His Honour concluded that it “is clear from the analysis that evidence of factual matters (not matters in the nature of evaluation or opinion) adverse to a claimant’s own past ‘conduct’ and hence his or her past reputation, is admissible, albeit in limited extent, having regard to the facts proved in reduction of damages.” [26]

    23. [1988] 1 All ER 282 (at 287); [1998] 1 WLR 116 (CA) (“Pamplin”) (at 120).

    24. [2000] EWCA Civ 338; [2000] 2 All ER 2384; [2001] 1 WLR 579; (“Burstein”).

    25.    Primary judgment (at [103] – [115]).

    26.    Primary judgment (at [116]).

28. His Honour determined:

“[118] There was, of course, no evidence that the food and service at Roco was in any way poor or below standard. In particular, there was no evidence that the food served at Roco was ‘unpalatable’. The review was wholly defamatory of the plaintiffs in respect thereto in terms of the three pleaded imputations.

[119] Although the defendants contended that the evidence as to the food and service at Coco, as set out or referred to in the Schedule of Evidence,** proved to matters of fact concerning the same, for reasons discussed above, properly considered, the evidence relied upon by the defendants did not establish objective fact. The evidence and the comments and the observations in the review, based on Mr Evans’ personal experience of the items of food consumed by him and the observations made by him, reflect his personal reactions to them. There exists an important distinction between statements in the nature of evaluative assessments as to the food, being subjective assessments based on a reviewer’s reaction to what he or she sees and tastes on the one hand, and matters of fact that are objectively verifiable, not involving comment, opinion or evaluation.

[120] The statements contained in the review, in my opinion, are properly characterised as statements of opinion rather than statements of fact contrary to the submissions made on behalf of the defendants…”

**The Schedule of Evidence is Appendix 2 to these reasons.

29. The primary judge also concluded, [27] referring to Harrison J’s judgment, [28] that he did not consider his Honour “intended to make, findings of fact as to the quality of the food and the quality of the service at the Coco restaurant”. Accordingly:

“The statements in the review and the evidence of Mr Evans as to his subjective assessments, valuations and opinions do not, in my opinion, place this case in the category of case to which Pamplin and Burstein may apply. In both of those cases the “facts” related to past conduct of or past events directly involving the particular plaintiffs in those cases, not matters of evaluation or opinion. They were facts concerning past actions and events that adversely affected reputation in each case. Further, the principle that permits evidence of bad character based on past facts to be admitted in defamation proceedings, when examined in the circumstances of those two cases, clearly do not have application in the circumstances of the present case where there is neither evidence of fact nor findings of primary fact made in other court proceedings.”

27.    Primary judgment (at [121] – [123]).

28.    (at [174], [176] and [177]).

30. In relation to the defence of mitigation his Honour therefore held: [29]

“(1) The statements of Mr Evans in the review and in evidence as to the quality of the food served at Coco and the service there observed by him were statements/evidence of his opinion on those matters. They were not statements/evidence of fact.

(2) Such findings as were made by Harrison J in the present proceedings were not findings of fact concerning the quality of food served or the service at the Coco restaurant.

(3) Such findings as were made by Harrison J are not and cannot constitute a basis for mitigation of damages.

(4) The application of the principle of mitigation in Pamplin and Burstein in each case was dependent and based upon proof of factual matters of a kind that diminished the reputations of each plaintiff.

(5) Any findings that were made by Harrison J could not, for reasons discussed above, constitute post-publication findings that diminished the plaintiffs’ reputations.

(6) On the basis of the Court of Appeal’s judgment and orders, the date upon which damages were to be determined was 18 December 2009, the date upon which judgment was delivered by Harrison J. It follows that such findings as were made by Harrison J have no public exposure or notoriety as at the date that damages were to have been assessed and awarded, (18 December 2009).

(7) The assessment of damages relates to the defamatory imputations concerning Coco and Roco.”

29.    Primary judgment (at [125]).

31. Nevertheless, his Honour said “those conclusions did not mean that I would have no regard in assessing damages to the matters of opinion expressed by Mr Evans in the review, or the evidence and opinions of other witnesses called in the plaintiffs’ case who dined at Coco.”  [30] In his Honour’s view the opinions expressed all provide context for the purposes of the assessment of damages. His Honour observed that “[t]he opinion of a food reviewer may, of course, not be an opinion that is shared at all by members of the public” and contrasted the different opinions as between the second respondent and the appellants’ witnesses, “who spoke of their enjoyment of their experience at Coco”. [31]

    30.    Primary judgment (at [126]).

    31.    (see also Harrison J (at [174], [176])).

32. His Honour added that:

“Likewise the fact that the review was found by the Court of Appeal to have included the Roco bistro, a substantial enterprise in itself, meant that the defamatory statements made in reference to it were publicised notwithstanding that Mr Evans had never visited Roco and therefore had no experience at all of either the food served or the service provided at Roco.” [32]

32.    Primary judgment (at [127]).

B   Assessment of Damages

33. The primary judge then turned to the assessment of damages. He noted that the provisions of Part 4, Division 8 of the 1974 Act governed the approach to be applied. [33] His Honour set out the relevant parts of s 46 and s 46A. [34]

    33.    Primary judgment (at [128]).

    34.    Primary judgment (at [129], [137]).

34. His Honour then discussed the purposes served by an award of damages for defamation, referring to Carson v John Fairfax & Sons Limited  [35] (“Carson”) and the observations of Hayne J in Rogers v Nationwide News Pty Ltd  [36] (“Rogers”). In particular, his Honour referred to Hayne J’s observations in Rogers that “it is of the first importance to recall the fundamental principle that the damages to be awarded for defamation must compensate for the effect of defamation on the particular plaintiff” [37] and that “the relationship which s 46A(2) identifies is not … some precise or mathematical relationship between the particular cases of defamation and personal injury or between classes of such cases [for] [t]o do that would compare the incomparable”. [38]

    35. [1993] HCA 31; (1993) 178 CLR 44.

    36. [2003] HCA 52; (2003) 216 CLR 327.

    37.    Primary judgment (at [73] – [74]).

    38.    Primary judgment (at [138] – [139]).

35. His Honour contrasted the injury done by defamation which “even if serious, is often evanescent, whereas some personal injuries are permanent and devastatingly disabling.”  [39]

    39.    Primary judgment (at [140]).

36. He added:

“[141]   As in every case, so in the present, it is important that the basis upon which a court may award damages for defamation is explained and made clear to the parties. There is a particular reason for doing so in the present case. Mr Evatt in his final submissions stated that he had been instructed to put by way of a submission a particularly large amount of money as the appropriate amount of damages to be awarded in this case. It is unnecessary here to specify the amount referred to at T 216 for it clearly reflects a complete misunderstanding by the plaintiffs as to the basis for and the statutory provisions by which I am required to assess the damages in the proceedings. The assessment of damages in these proceedings, of course, for reasons earlier noted, does not involve an assessment of any loss which either or both of their companies may have suffered with the closure of the Coco and Roco restaurants in 2004.

[142]    In this latter respect the plaintiffs' proceedings were opened by Mr Evatt before Harrison J as follows:

‘... there is no claim for financial loss in this case. So when I said that the restaurant folded and collapsed as a result of the review, that goes to hurt and upset and injury to reputation and there's no claim for financial loss’: (T 10 November 2009 at 35:20-23).”

37. His Honour then set out the statutory caps that applied to the award of damages for non-economic loss as at the date of publication (30 September 2003) in ss 16 and 17 of the Civil Liability Act 2002 (NSW) and the Civil Liability (Non-economic Loss) Order 2010 ($365,000) and ss 134 and 146 Motor Accidents Compensation Act 1999 (NSW) and the Motor Accidents Compensation (Determination of Loss) Order No 3 ($309,000).

38. The primary judge considered the evidence both before Harrison J and the supplementary evidence given before him. [40]

    40.    Primary judgment (at [147] – [238]).

C   Compensatory Damages

39. The primary judge stated that “it should be accepted that each of the [appellants] had, prior to the reviews’ publication, been decent and hardworking people”. [41] He also noted that the review was published in the “Good Living section of the Sydney Morning Herald, a prominent daily newspaper with a wide circulation and wide readership”. [42] His Honour concluded that, as part of the contextual background to the feelings the appellants said they experienced and the impact upon them having read the matter complained of, he could take into account the fact that the evidence established that “the plaintiffs had a substantial personal investment and potential liability associated with Coco Roco enterprise”. [43] In this context his Honour said:

“[245] The unchallenged evidence given by each of the plaintiffs was that they were severely affected by the defamatory review, that it has caused harm to them as they described in evidence and that they, in particular, each suffered acute grief and distress as a result of the publication of the matters complained of.”

41.    Primary judgment (at [240]).

42.    Primary judgment (at [241]); the extensive State and territory circulation figures were set out (at [202]).

43.    Primary judgment (at [244]).

40. His Honour also emphasised that it was necessary to ensure compensatory damages related to the injury and harm each appellant suffered, and did not include injury and harm “otherwise related to the collapse” of their business and the consequent financial and other repercussions. [44]

    44.    Primary judgment (at [246]).

41. The primary judge found:

“[248] Having heard and seen the plaintiffs give evidence, I unreservedly accept that the plaintiffs each have suffered considerable and ongoing distress and hurt as a result of the publication of the matters complained of. I do not, as I have earlier stated, accept the submission made on behalf of the defendants that the plaintiffs should only be awarded ‘modest’ compensatory damages. They are each entitled to an appropriate award of damages for the ‘relevant harm’ as defined by s 46 of the 1974 Act that is at a level that has an appropriate and rational relationship to the harm each has suffered in accordance with the evidence.

[249] The imputations, in particular the ‘unpalatable food imputation’ and the ‘incompetence imputation’ were extremely adverse to the plaintiffs so far as their reputation in the restaurant industry in the States in which the review was published. The relevant sectors of that industry in which they operated Coco Roco included both the field of fine dining or sophisticated restaurants as well as that involving the more casual restaurant sector in which the restaurant Roco operated.

[250] The production and service of ‘unpalatable’ food in either the fine dining area and the bistro-style restaurant enterprise is plainly amongst the most adverse or severe criticisms of a restaurant. The large readership of the Sydney Morning Herald Good Living section may be considered to be but one matter to be taken into account in assessing the adverse impact of the article to the plaintiffs.

[251] I have referred earlier to the fact that in relation to the review found to be defamatory of the plaintiffs in respect of both the restaurant (Coco) and bistro (Roco), Mr Evans had no experience of the latter to support the comments made in the review. The Roco bistro represented a substantial part of the enterprise that had been established by the plaintiffs.

[253] Plainly the imputation as to incompetence made against each plaintiff was a significant one as it was directed to the ability and capacity to conduct a restaurant and bistro such as Coco and Roco.

[254] The review was expressed in pungent and strong deprecatory terms as to the quality of the food and service experienced at the Coco restaurant and was defamatory of the plaintiffs in respect of both Coco and Roco.

[255] I accept that the plaintiffs’ damages are aggravated by the lengthy and continued publication on the internet. The internet publication on the evidence has continued to be accessed and seen by the plaintiffs, and a number of their family, friends and associates. Any person, including prospective employers, can readily access the review found by the jury to have been defamatory of the plaintiffs. The defendants have not by way of evidence or otherwise sought to explain or justify the continued publication of the review on the SMH website. The ongoing publication has continued to give life to the review, albeit in a negative sense resulting in an exacerbation of the distress and hurt occasioned to the plaintiffs.”

42. The primary judge also accepted that the unreasonable failure of the respondents to apologise to the appellants should be taken into account in the determination of normal compensatory damages in that it had contributed to their hurt by keeping alive the effect of the publication. [45]

    45.    Primary judgment (at [256]).

43. The primary judge rejected the respondents’ submission that damages should be reduced on the basis that the appellants had “brought the bad review upon themselves” by serving unpalatable food to a food critic. [46] Referring to his earlier findings in relation to mitigation, his Honour noted that this submission depended on the assumption that the food being “unpalatable” had been objectively determined by the second respondent, rather than being his “subjective opinion”. Nor, his Honour added had the respondents established “that the review was ‘directly provoked’ by the plaintiff’s conduct in the sense discussed in Burstein at 590 or in any true causal sense arose due to any such conduct.” [47]

    46.    Primary judgment (at [257] – [265]).

    47.    Primary judgment (at [265]).

D   Aggravated Damages

44. In relation to aggravated damages, his Honour considered the continued presence of the review on the internet (it was removed from the website following the judgment of the Court of Appeal, but was later restored and remained there at the time of hearing). His Honour “concluded that the conduct of the first respondent in placing the defamatory article on the internet constitutes unjustifiable conduct” and that it had increased the damage caused to each plaintiff by the original publication” [48] and “caused each of the plaintiffs significant upset and distress.” [49]

    48.    Primary judgment (at [270]).

    49.    Primary judgment (at [272]).

E   Exemplary Damages

45. The appellants claimed exemplary damages in respect of the publication of the defamatory material in states of Australia other than New South Wales and in Commonwealth Territories. The primary judge noted [50] that counsel for the appellants acknowledged that the claim for exemplary damages could only be founded on the fact of the continued publication of the review on the internet.

    50.    Primary judgment (at [276]).

46. The appellants contended [51] that “the amount of exemplary damages awarded should serve as a warning to the first defendant that it will be punished financially … if they won’t take down [the] matter which the Court of Appeal and the High Court have established [was] wrong”. The respondents contended there was no evidence to support such an award. [52]

    51.    Primary judgment (see [277]).

    52.    Primary judgment (at [278] – [280]).

47. The primary judge noted [53] that “it is now well established that the award of exemplary damages is an exceptional remedy in cases of conscious wrongdoing in contumelious disregard of a plaintiff’s rights”.

    53.    Primary judgment (at [285]).

48. The primary judge considered [54] that the first respondent’s actions in “reinstating the article on its internet website [after having been taken down following the Court of Appeal reversal of Harrison J’s decision] and its failure, and on some evidence its refusal, to remove it is conduct that could be said to warrant disapproval and even censure”. Nonetheless, it was “necessary to take into account as a modifying factor that the review on the first [respondent’s] website is not the equivalent of widespread publication by a print media as it requires specific search terms to be employed to activate publication of it”. [55]

    54.    Primary judgment (at [286]).

    55.    Primary judgment (at [287]).

49. His Honour concluded:

“[288] Taking into account all matters associated with the internet publication and the matters to which I have referred above, I do not consider that this is a case in which it can be said that the required form of conscious wrongdoing that is necessary has been established. As earlier stated, the continued presence of the review on the SMH website is a matter, in my opinion, properly to be taken into account in determining aggravated damages.”

50. Judgment was entered in favour of each of the three appellants in the amount of $160,000 each, such amount, including a component of aggravated damages. [56]

    56.    Primary judgment (at [289] – [290]).

The Costs Judgment

51. The only aspect of the Costs Judgment the subject of appeal concerns the “backdating” issue. The appellants submitted below that the date of his Honour’s judgment should be backdated to the date of Harrison J’s judgment because it “in effect replaced the award made by Harrison J.”  [57] They relied upon UCPR 36.4(3) as the basis upon which his Honour could accede to that application.

    57.    Costs Judgment (at [6], [8]).

52. The primary judge accepted (and the respondents conceded) that he had power under UCPR 36.4(3) to order that his judgment take effect as of a date earlier (or later) than the date fixed by UCPR 36.4(1). The issue was “whether the discretion to make such an order should be exercised”. [58]

    58.    Costs Judgment (at [51]).

53. His Honour said:

“[52] That question is to be considered in the circumstances of the lengthy history of this case, namely one involving the plaintiffs’ claims for damages in respect of the defamation, the fact that there was a mistrial on liability and damages, a successful appeal by the plaintiffs to the Court of Appeal leading to an order of that Court setting aside the orders made in the first trial and the entry of judgment for the plaintiffs, and then a second trial on damages.”

54. The primary judge distinguished on two bases Nicol v Allyacht Spars Pty Ltd (No 2) [59] and Nicholson v Nicholson [60] on which the appellants relied, each being a case in which judgment on appeal was awarded with interest from the date of the first instance judgment.

    59. [1988] HCA 48; (1988) 165 CLR 306 (“Nicol”).

    60. (1994) 35 NSWLR 308.

55. First, the Court of Appeal had not made “‘variation’ orders which had the effect of increasing an established right to damages previously determined under an earlier judgment at first instance”. [61] Secondly, the case “was not analogous to one involving a variation of an earlier judgment awarding damages and increasing damages previously awarded” as Harrison J made no actual award of damages “but merely a notional assessment having determined liability against the plaintiffs.” [62]

    61.    Costs Judgment (at [54]).

    62.    Costs Judgment (at [57]).

56. Accordingly, as the first time the appellants “had an established right to damages was on 19 December 2013 the date upon which final judgment was delivered in their favour”, it would not “represent a proper exercise of the power … to backdate the judgment simply so as to enable the plaintiffs to claim a post-judgment interest rate for a period in lieu of the ‘conventional’ rate for defamation damages that would otherwise apply”. [63]

    63.    Costs Judgment (at [58] – [59]).

Issues on appeal

57. As I have said, generally the appellants submit the award of damages of $160,000 each was manifestly inadequate and warrants being set aside by the Court of Appeal. They contend there are “extraordinary circumstances” which warrant the original award being increased. They contend they should each have been awarded verdicts in the vicinity of $400,000.

58. In their amended notice of appeal, the appellants complain that:

1. The amount of damages awarded to each of them was inadequate.

2. His Honour erred in not awarding exemplary damages.

3. His Honour erred in taking into account s 46A of the 1974 Act in his assessment of damages without giving the parties the opportunity of making submissions as to its application and the effect on quantum.

4. His Honour erred by misapplying s 46A in his award of damages.

5. His Honour erred in confining his award of aggravated damages to the continued publication of the review on the first respondent’s website and not taking into account other categories of aggravated damages.

6. His Honour erred in not giving sufficient weight in his award of compensated damages to the stress and worry the appellants suffered due to factors including bankruptcy and the long period of time between the date of publication (30 September 2003) and the date of judgment (19 December 2013) during which period there had been two appeals to the High Court, two appeals to the Court of Appeal, two s7A jury trials and two non-jury trials.

7. His Honour erred in not back dating interest on the amount of damages awarded at court rates from 19 December 2013 [sic, “18 December 2009” (the date of judgment of Harrison J)].

8. His Honour erred in not back dating interest on the award of damages.

9. His Honour erred in not back dating interest on his award of damages pursuant to Uniform Civil Procedure Rule 36.4(3).

59. The appellants seek orders allowing the appeal, increasing the damages to be awarded to each to such sum as this Court may find appropriate and interest on those damages at Court rate to be back dated to a date decided by the Court.

60. In their amended notice of cross-appeal, the respondents contend that the primary judge erred on the issue of mitigation of damages:

1. In holding that the findings of Harrison J in [2009] NSWSC 1403 did not establish facts relevant to the cross-respondents’ reputations as at the date of publication;

2. In holding that the findings of Harrison J in [2009] NSWSC 1403 did not establish facts directly relevant to the contextual background in which the review was published.

3. In holding that the findings made by Harrison J in [2009] NSWSC 1403 were “post-publication” findings not relevant to the assessment of damages; and

4. In holding that the statements of the second cross-appellant in the review and in evidence in the proceedings before Harrison J as to the quality of the food and service at Coco were statements of opinion, and evidence of the second appellant’s opinion, and that there were no statements of fact and evidence of facts relevant to the assessment of damages.

61. The cross-appellants seek orders that the damages be reassessed by the Court, that the cross-respondents repay to them any sums previously paid to them as damages (and interest thereon) in excess of the award of damages (and interest thereon) by this Court together with interest on those sums, alternatively, an order that any sums payable by the cross-respondents should be set off against any sums payable by the cross-appellants to the cross-respondents for costs in the proceedings in the Courts below.

The appeal

62. Before turning to the appellants’ discrete complaints about the damages awarded, the nature of an award of damages for defamation should be outlined.

63. In Rogers  [64] Hayne J (Gleeson CJ and Gummow J agreeing) said (footnotes omitted):

“[60] The three purposes to be served by an award of damages for defamation are identified in the joint reasons in Carson v John Fairfax & Sons Ltd: (i) consolation for the personal distress and hurt caused to the appellant by the publication; (ii) reparation for harm done to the appellant's personal, and in this case, professional reputation; and (iii) the vindication of the appellant’s reputation. As pointed out in Carson the first two purposes are frequently considered together and constitute consolation for the wrong done to the appellant; vindication looks to the attitudes of others.”

64.    (at [60]).

64. As the harm caused to a plaintiff by the publication of the defamation often lies more in the plaintiff’s own feelings, that is to say in what the plaintiff thinks other people are thinking of him or her, than in any actual change made manifest in their attitude towards him,[65] “[a] solatium for injured feelings, however innocent the publication by the defendant may have been, forms a large element in the [general compensatory] damages”. [66]

    65. Ali v Nationwide News Pty Ltd [2008] NSWCA 183 (at [72]) per Tobias and McColl JJA.

    66. Cassell & Co Ltd v Broome [1972] AC 1027 (at 1124) per Lord Diplock.

65. The emphasis placed on each purpose of an award of defamation damages will vary depending upon the facts of each case. Sometimes, for example, there may be relatively little demonstrable damage to reputation, but serious emotional distress; on other occasions, the need for public vindication will predominate; in yet other cases the financial consequences of damage to the reputation of the individual may represent the most serious feature. [67]

    67. Cairns v Modi [2012] EWCA Civ 1382; [2013] 1 WLR 1015 (at [22]).

Section 46A (Grounds 3 and 4)

66. In his written submissions, Mr Evatt, who appeared for the appellants at trial and on appeal with Mr R Rasmussen and Mr C Dibb, complained that the primary judge erred in taking into s 46A(2) of the 1974 Act without giving the parties the opportunity of making submissions as to its application and its effect on quantum. First, they contended, his Honour should have raised the s 46A(2) with counsel during submissions. Secondly, they submitted that, uninstructed by parties’ submissions, his Honour erred in referring [68] only to the statutory caps for non-economic loss in the Civil Liability Act and the Motor Accidents Compensation Act without also considering the general range of damages for non-economic loss in personal injury awards. Had he raised the issue with the parties, the appellants submitted they would have directed his Honour’s attention to case law dealing with the application of the section.

    68.    Primary judgment (at [144] – [145]).

67. Thirdly, the appellants argued that his Honour did not explain how he applied the statutory caps and what effect they had on his award. Nevertheless they contended the damages awarded suggested he was unduly influenced by the statutory maxima which were, they argued, at most a guide. Had they been able to refer his Honour to case law, they would have demonstrated that s 46A(2) did not impose a cap on damages, may be of limited utility, and was not invariably taken into account. Fourthly, the appellants submitted that the enquiry dictated by s 46A(2) was of secondary importance to the s 46(A)(1) requirement that there be an appropriate and rational relationship between the harm and the amount of damages.

68. In oral submissions Mr Evatt only faintly pursued his procedural fairness point, recognising that s 46A was a mandatory consideration. Nevertheless he submitted that the primary judge misapplied s 46A (at [143]) in failing to refer to awards other than those the subject of statutory caps. Mr Evatt submitted that had the primary judge raised his intention to refer to s 46A(2), the parties could have assisted him by referring to a range of cases in which larger amounts than $160,000 had been awarded to plaintiffs in defamation actions.

69. Mr Evatt referred to Re Media Entertainment & Arts Alliance; ex parte Hoyts Corporation Pty Ltd (No 2) [69] where the Court held that one aspect of the rule against bias “is that the decision should be made on the basis of the evidence and the argument in the case, and not on the basis of information or knowledge which is independently acquired”, an aspect of the rule the Court said was “similar to but not identical with the rule of procedural fairness which requires that a person be given an opportunity to meet the case against him or her”.

    69. [1994] HCA 66; (1994) 68 ALJR 179 (at 182).

66. The respondents pointed out that s 46A(2) was a mandatory consideration and that the appellants must have appreciated this at the hearing. They contended the appellants had shown no reason why they should be permitted to raise its application on appeal. Secondly, the respondents contended the appellants had not demonstrated any error in his Honour’s application of s 46A(2), in the identification of statutory maxima relevant to the assessment of damages or why regard to some other criteria might have produced a different result.

Section 46A – determination

71. Although the appellants address two grounds of appeal to s 46A their submissions did not distinguish between the grounds and may be dealt with as one complaint.

72. The appellants’ written submissions at trial referred to general principles governing the award of compensatory, aggravated and exemplary damages in defamation cases. In oral submissions at trial Mr Evatt addressed the issues of exemplary and aggravated damages and, to a lesser extent, compensatory damages. In the latter respect, as the primary judge said, [70] Mr Evatt informed his Honour he had specific instructions to put a figure. That figure was, “that each client should be awarded, $2 million each”.

    70.    Primary judgment (at [141]).

73. As the primary judge said, the amount Mr Evatt submitted on behalf of his clients should be awarded by way of compensatory damages demonstrated “a complete misunderstanding” by them of the process of assessment of damages. His Honour was also entitled to infer, in my view, that Mr Evatt did not refer to the statutory framework within which damages were required to be assessed because that would detract from the damages he was instructed to seek and that his Honour was not afforded any assistance on the matters referred to in s 46A(2) for that reason.

74. A section 46A(2) was a mandatory consideration, his Honour was also entitled to infer that the parties assumed he would have sufficient familiarity with the matters s 46A(2) required him to take into consideration not to require submissions from them.

75. I do not read his Honour’s reasons as suggesting that he was unduly influenced by the statutory maxima. Contrary to Mr Evatt’s submissions, nothing in his Honour’s reasons suggests that he understood the statutory caps to which he referred as limiting or capping the amount he could award the appellants for compensatory damages.

76. The appellants do not criticise the primary judge’s recitation [71] of the principles concerning an award of damages for defamation. One of those principles to which his Honour referred was Hayne J’s statement in Rogers [72] that a “fundamental principle” [is] that the damages to be awarded for defamation must compensate for the effect of the defamation on the particular plaintiff …” (emphasis in original). His Honour also noted that “damages awarded for defamation … must stand in a proper relationship with awards for the non-economic consequences of personal injury”, but (again referring to Rogers), “the relationship which s 46A(2) identifies is not … some precise or mathematical relationship between the particular cases of defamation and personal injury or between classes of such cases. To do that would compare the incomparable”. [73]

    71.    Primary judgment (at [130]ff).

    72.    Primary judgment (at [138]).

    73.    Primary judgment (at [139]).

77. Thus, his Honour was required to focus on the effect of the defamation on each appellant, as well as to at least “consider” the amounts referred to in s 46A(2). But to do so did not require the “recitation of a string of awards of damages in personal injury cases and a demonstration of precisely how they were taken into consideration in assessing the damages in the instant case.”[74] In such circumstances references to other cases would be of limited utility. His Honour was required to take the matters set out in s 46A(1) and (2) into consideration, but they were not to be determinative in his assessment of compensatory damages.

    74. Moit v Bristow [2005] NSWCA 322 (at [125]) per McColl JA (Beazley and Campbell JJA agreeing).

78. There is no indication in the primary judge’s reasons that he regarded the caps in the legislation to which he referred as providing some precise reference for the damages he was to award.

79. In my view the primary judge did not deny the appellants any procedural fairness. Rather, their counsel did not, undoubtedly in the light of his instructions as to the quantum of damages the appellants had instructed him to seek, afford his Honour any assistance on s 46A.

80. I would reject these grounds of appeal.

Exemplary damages (Ground 2)

81. This aspect of the appellants’ claim as outlined in their written submissions was based on the fact that the review, as well as an article published on the SMH Good Living website on 18 December 2009 with the headlines “Coco Roco loses action over ‘stay home review’” (the “Court case article”) describing the appellants’ failure to make out their defamation claim before Harrison J, had remained on the Sydney Morning Herald website despite the finding that the review was defamatory and what was said to be a request from the appellants that it be removed. In oral submissions, Mr Evatt confined the exemplary damages claim to the continued publication of the review.

82. The appellants do not challenge the primary judge’s statements of principle concerning the basis of an award of exemplary damages. However they do criticise his Honour’s statement that:

“[287]…the review on the first [respondent’s] website is not the equivalent of widespread publication by a print media as it requires specific search terms to be employed to activate publication of it.”

83. Mr Evatt submitted that widespread publication is not the test for determining whether exemplary damages should be awarded. In any event, he contended that the number of readers in other States and Territories was large. However, he submitted that the appellants were entitled to exemplary damages because the first respondent’s conduct in persevering for nine years with untrue, defamatory and misleading material on its websites deserved the censure of the Court, no matter how many persons downloaded or read it. By doing so he argued the first respondent engaged in “conscious wrongdoing in contumelious disregard” for their rights.

84. Mr Blackburn noted in his written submissions that the appellants did not submit that the first publication of the review occurred with knowledge of its falsity but, rather, contended they were entitled to exemplary damages because of the first respondent’s failure to remove it from its website following judicial determination of its defamatory nature. He submitted that the underlying premise of the appellants’ claim was that a failure to purge historical acts subsequently found to be wrong constituted “conscious wrong-doing in contumelious disregard of another’s rights”. This was notwithstanding the fact that the appellants would otherwise obtain vindication for the defamatory publication through an award of compensatory and, possibly, aggravated damages. He argued that that there must be a distinction between a publication first made with knowledge of its falsity and in contumelious disregard of a plaintiff’s rights, and the continuing publication of the review, notwithstanding a judicial determination that it was defamatory.

85. Mr Blackburn also submitted that the question of whether the first respondent’s conduct was such as would warrant an award of exemplary damages involved an exercise of discretion on the part of the primary judge requiring the appellants to demonstrate that his Honour took irrelevant matters into account, failed to take relevant matters into account or that his decision was so unreasonable as to warrant intervention or otherwise vitiated by error. [75]

    75. Moran v McMahon (1985) 3 NSWLR 700.

86. In oral submissions, Mr Blackburn emphasised that although it might be accepted the continued publication of the defamatory review on the first respondent’s website was a disregard for their rights, that fact had to be balanced against the first respondent’s freedom to continue to make available the historical record of what it had published. He also emphasised that that record would only be accessed by people who took the trouble to go to the Herald’s website and search in a manner which produced the review.

87. Next, Mr Blackburn emphasised that the appellants had not taken any step, such as to seek by way of an injunction, to restrain the first respondent from keeping the review on its website nor had they sought to pursue further defamation actions based on the continuing publication having regard to the fact that each time a person read the review on the Herald’s website, it constituted a new cause of action. [76]

    76. Dow Jones & Company Inc v Gutnick [2002] HCA 56; (2002) 210 CLR 575 (at [44]) per Gleeson CJ, McHugh, Gummow and Hayne JJ, Gaudron J agreeing at [56]).

Exemplary damages – determination

88. The prohibition in s 46(3)(a) against awarding exemplary damages only applied to New South Wales and not to the other States and Territories. Accordingly, even when the 1974 Act was in force, a court in New South Wales could award exemplary damages to a plaintiff in respect of defamatory matter published in a State or Territory in which such damages were available: Marsden v Amalgamated Television Services Pty Ltd. [77]

    77. [2001] NSWSC 510 (“Marsden (Levine J)”) (at [4915]).

89. The evidence established that the review was on the Sydney Morning Herald’s website from 30 September 2003 until the first Court of Appeal judgment on 30 June 2006. It was then taken off the website but was restored on the date of the High Court’s judgment on 14 June 2007 and has remained there. [78]

    78.    Primary judgment (at [272]).

90. When dealing with aggravated damages, the primary judge concluded that the first respondent’s conduct in placing the review on its website constituted unjustifiable conduct attracting an award of aggravated damages. [79]

    79.    Primary judgment (at [266] – [274]).

91. It was in the context of that finding that the primary judge came to consider the issue of exemplary damages. The primary judge set out the legal principles concerning awards of exemplary damages in the following manner:

“[282] In Uren v John Fairfax & Sons Pty Ltd [1965] – [1966] 117 CLR 118 at 149, Windeyer J stated:

‘... first, it is necessary to notice that, whatever be the position in torts other than defamation, the distinction between aggravated and exemplary damages is not easy to make in defamation, either historically or analytically; and in practice it is hard to preserve. The formal distinction is, I take it, that aggravated damages are given to compensate the plaintiff when the harm done to him by a wrongful act was aggravated by the manner in which the act was done: exemplary damages, on the other hand, are intended to punish the defendant, and presumably to serve one or more of the objects of punishment – moral retribution or deterrence.’

[283] In Uren, Windeyer J at p 153 also stated that the decision in Rookes v Barnard [1964] AC 1129 emphasised that exemplary damages must always be based on something more substantial than a jury's mere disapproval of the conduct of a defendant. His Honour further observed:

‘... the decision makes clear too, if it was ever in any doubt, that all matters that may aggravate compensatory damages do not of themselves justify the addition or inclusion of the further purely punitive element ... The wrong must be one of a kind for which exemplary damages might be given; and the facts of the particular case must be such that exemplary damages could properly be given ... There must ... be evidence of some positive misconduct to justify a verdict for exemplary damages. There must be evidence on which the jury could find that there was, at least, a 'conscious wrongdoing in contumelious disregard of another's rights'. I select that particular phrase out of many, because it has been used more than once in this Court ...’

[284] In Gray v Motor Accident Commission (1998) 196 CLR 1 at 6, the High Court (Gleeson CJ, McHugh, Gummow and Hayne JJ) observed that:

‘Exemplary damages are awarded rarely. They recognise and punish fault, but not every finding of fault warrants their reward. Something more must be found. Although they are awarded rarely, they have been awarded in very different kinds of cases: ranging from abuse of governmental power ... through defamation cases of the kind considered in Uren, to assault cases ...’

[285] Accordingly, it is now well established that the award of exemplary damages is an exceptional remedy in cases of conscious wrongdoing in contumelious disregard of a plaintiff's rights.”

92. In Marsden CA the Court (Beazley, Giles and Santow JJA) held [80] that the question whether exemplary damages should be awarded (as opposed to the amount of such an award) was not of a discretionary nature. The respondents’ submission to the contrary cannot be accepted.

    80.    (at [1477]).

93. There is “no exhaustive list of the kind of behaviour courts consider reprehensible or egregious enough to warrant a remedy of exemplary damages”. [81] Further, it is not necessary that “the defendant have a conscious feeling of spite or ill will towards the plaintiff in order to be in contumelious disregard of his rights … a contemptuous high handed carelessness is sufficient.” [82]

    81.    Marsden (Levine J) (at [4933]).

    82.    Marsden (Levine J) (at [4940]).

94. In this case, the first respondent did not suggest it had acted carelessly in leaving the review on its website. Rather, its contention was, in effect, that it did so deliberately (as can be inferred from it restoring the review to its site following the High Court judgment) in order to preserve the historical record. It contended that, had they wanted to, the appellants could have taken steps to enforce whatever rights they may have to have the review removed or to take further proceedings in respect of the continuing defamations constituted when persons accessed the review on the first respondent’s website.

95. The appellants asserted they had made some attempt to have the review removed after its defamatory nature had been proven. The evidence in this respect was weak. It amounted merely to an assertion by the first appellant that she called the first respondent’s “readers’ line” and left her name, number and asked for the review to be taken down from the internet, had never received a response and the review was still there. [83]

    83.    Black 39 G-I.

96. Had they wished, the appellants could have taken more positive steps to have the review removed from continued internet publication. They could have sought an injunction for it to be removed and to prohibit its further publication. The usual limitation which applies on the grant of such an injunction in an interlocutory context would, prima facie, not apply, as they had established there was no defence of justification. [84]

    84. See generally Australian Broadcasting Corporation v O’Neill [2006] HCA 46; (2006) 227 CLR 57.

97. Further, it was open to the appellants to seek leave to bring further proceedings for defamation against the first respondent in respect of the continued publication of the review. [85]

    85.    1974 Act s 9(3).

98. In my view it was relevant for the primary judge to take into consideration (at [287]) the fact that the publication of the review on the first respondent’s website was “not the equivalent of widespread publication by a printed media as it requires specific search terms to be employed to activate publication of it”. In other words, it can be assumed once the review was not published as part of the daily internet “edition” of the Sydney Morning Herald, it required positive conduct on the part of a person for it to be located. Secondly, even if it might be found that its conduct in keeping (and at one stage restoring) the review to its website warranted “a finding of fault”, the question is whether “something more” than mere fault could be found. [86] The “something more is not readily to be found”. [87]

    86. Gray v Motor Accident Commission [1998] HCA 70, (1998) 196 CLR 1 (at [12]).

    87.    Marsden CA (at [1493]).

99. My mind has wavered as to whether the circumstances warrant an award of exemplary damages. My original thought was that they should not. However, I have been persuaded by Barrett JA’s pellucid analysis of the issue to the contrary view. It is not to point, on reflection, that the appellants may have the right to take further action to restrain the first respondent from continuing to publish the review (and, of course, the defamatory imputations) on its website. Rather, the first respondent’s conduct in keeping the review on its website after the Court of Appeal judgment and the failure of its special leave application confirmed it had published an indefensibly defamatory review of and concerning the appellants manifested the “conscious wrongdoing in contumelious disregard” of their rights of which Windeyer J wrote in Uren v John Fairfax & Sons Pty Ltd. [88] That conduct can properly be characterised as more than “mere fault”.

    88. [1966] HCA 40; (1966) 117 CLR 118 (at 154).

100. Further, it should not be forgotten that an element of, or at least an effect of, an award of exemplary damages is “deterrence which … extends beyond the actual wrongdoer and the exact nature of his wrongdoing”. [89] They also “serve to assuage any urge for revenge felt by victims and to discourage any temptation to engage in self-help likely to endanger the peace” and serve as an “element of appeasement”. [90] The appellants should not have to resort to further litigation to be appeased in respect of the first respondent’s flagrant disregard of the rights they had already established through litigation.

     89. Lamb v Cotogno [1987] HCA 47; (1987) 164 CLR 1 (at 9).

     90.    Lamb v Cotogno (at 9 – 10).

101. Accordingly, I agree with Barrett JA’s reasons on this issue.

Aggravated Damages (Ground 5)

102. The appellants submit that the primary judge erred in failing to award them aggravated damages in respect of the respondents’ unreasonable failure to apologise and, too, because of their knowledge that the imputations were false.

103. Each appellant gave evidence at the trial before Harrison J and the primary judge that they knew the imputations were false and were upset (to varying degrees of severity) by reason of that knowledge. [91] Mr Evatt submitted that that evidence entitled them to aggravated damages and that the primary judge’s failure to refer to their knowledge in this respect when considering aggravated damages indicated his Honour did not take those matters into consideration in that respect.

     91. Blue 84 E-R (first appellant); 183 T-W (second appellant); 170 P-R (third appellant); see primary judgment (at [181]); [198]).

104. The appellants also claimed aggravated damages on the basis of the respondents’ wrongful, improper or unreasonable failure to apologise. Their previous solicitor had sought such an apology in a letter to the editor of the Sydney Morning Herald. They had never received an apology even after their successful appeal in this Court. Each appellant gave evidence that they were upset that the respondents had not apologised. [92] Mr Evatt accepted that the primary judge referred to failure to apologise, but complained that his Honour took it into account only as a matter to be considered in the award of general compensatory damages. [93] In so doing, the primary judge accepted that the respondents’ failure to apologise was unreasonable. Mr Evatt submitted that finding should have entitled the appellants to aggravated damages by reason of the respondents’ failure to apologise.

     92.    Black 28.5 – 35 (first appellant); 53.20 (second appellant); and 59.30 (third appellant).

     93.    Primary judgment (at [256]).

224. With respect to McColl JA’s view in [209], I do not consider that ordinary reasonable readers of the article would in general be so dispassionately analytical as to ignore or at least heavily discount the impact of the mitigatory facts because those facts related only to Coco, reflected the experiences of one man only and did not affect the reviewer’s enjoyment of some important aspects of the meals that he was served. Accordingly, I respectfully disagree with her Honour’s view that the reduction in damages should be modest.

Conclusions

227. On the cross appeal I have concluded that a substantial, and not merely modest, reduction should be made to the appellants’ damages. My view is that the damages awarded to each appellant against each respondent should be reduced by $70,000 by reason of the matters of mitigation relied upon on the cross-appeal.

228. As the appellants have been successful on their appeal and the respondents successful on their cross-appeal, there should be no order as to the costs of the appeal and cross-appeal. There is no reason to vary costs orders made at first instance.

229. In these circumstances, I propose the following orders:

1. Appeal allowed.

2. Cross-appeal allowed.

3. Set aside the judgments entered at first instance on damages and interest.

4. Judgment to be entered in favour of each appellant in an amount to be determined.

5. Note that these judgments will be ordered to take effect as at 18 December 2009.

6. If the parties are able to agree as to the amount of the judgments (inclusive of interest) to be entered in accordance with these reasons for judgment, direct that within 7 days they file a form of consent order in the Court of Appeal Registry.

7. If the parties are unable to so agree, direct that they file proposed forms of orders and submissions in support as follows:

1. The appellants within 14 days of the date of this judgment

2. The respondents within 14 days thereafter

3. Any reply within a further 7 days.

8. Note that the Court makes no order as to the costs of the appeal and cross-appeal.

230. BARRETT JA: I have had the advantage of reading in draft the reasons to be published by McColl JA and Macfarlan JA. As their Honours agree with the conclusion I have reached on exemplary damages, it is appropriate that I deal with that subject first.

231. As McColl JA explains at [88], exemplary damages can be awarded in proceedings governed by the Defamation Act 1974 (NSW) (the “1974 Act”), but only in respect of defamatory matter published in a State or Territory in which such damages are available. It is not disputed that publication of the restaurant review occurred in relevant States and Territories outside New South Wales not only because of limited circulation of the newspaper there but also (and more particularly) through posting of the review on the SMH Good Living website (“the website”). Nor is it disputed that the first respondent maintained and controlled that website and determined what was posted on it.

232. I have concluded that exemplary damages should be awarded against the first respondent in respect of publication of the restaurant review on the website in so far as that publication occurred in States and Territories outside New South Wales.

233. The principles relevant to exemplary damages are not in dispute. Such damages punish the defendant by way of “a penalty for a wrong committed in such circumstances or in such manner as to warrant the court’s signal disapproval of the defendant’s conduct”. These are words used in Uren v John Fairfax & Sons Pty Ltd [199] by Taylor J who approved statements that exemplary damages are awarded only for “conscious wrongdoing in contumelious disregard of another’s rights” or for “reprehensible conduct and as a deterrent”. The first of these formulations is that of Knox CJ in Whitfield v De Lauret & Co Ltd [200] and was said by members of the High Court in Gray v Motor Accident Commission [201] to describe “at least the greater part of the relevant field”.

     199. [1966] HCA 40; 117 CLR 118 at 131.

     200. [1920] HCA 75; 29 CLR 71 at 77.

     201. [1998] HCA 70; 196 CLR 1 at 7.

234. The restaurant review was first posted on the website on 30 September 2003. It was removed on 30 June 2006 and reinstated on 14 June 2007. After the latter date, it continued to be available to anyone accessing the website. The significance of the dates 30 June 2006 and 14 June 2007 emerges from an examination of the course that the proceedings took.

235. The defamation action was commenced by statement of claim filed on 23 June 2004. Before the trial of any issue by a jury, a judge of the Common Law Division (Nicholas J) ruled that four imputations were reasonably capable of being carried by the restaurant review and of bearing a defamatory meaning. A trial of some of the issues was then conducted pursuant to s 7A(3)(b) of the 1974 Act before a judge (Bell J) and a jury. The jury found that two of the imputations were conveyed but were not defamatory and that the other two imputations were not conveyed. Judgment was therefore entered for the respondents. The appellants appealed to this Court. They challenged the jury’s finding in respect of three of the four imputations. On 30 June 2006, the Court upheld the appeal, finding for the present appellants on two imputations and remitting a third imputation for determination by a jury. [202]

     202. Gacic v John Fairfax Publications Pty Ltd [2006] NSWCA 175; 66 NSWLR 675.

236. The present respondents appealed to the High Court which, on 14 June 2007, ordered that verdicts be entered that the matter complained of by the appellants carried each of two of the imputations and that those imputations were defamatory; and that the question whether the third imputation was carried (and whether it was defamatory) should be remitted for determination by a jury. [203]

     203. John Fairfax Publications Pty Ltd v Gacic [2007] HCA 28; 230 CLR 291.

237. In consequence of the High Court decision and a further jury trial on 19 September 2007 (before Adams J), it was established that the restaurant review conveyed the following imputations, each of which was defamatory of each of the present appellants:

(a)    he or she sells unpalatable food at Coco Roco (the "unpalatable food imputation");

(b)    he or she provides some bad service at Coco Roco (the "bad service imputation"); and

(c)    he or she is incompetent as a restaurant owner because he or she employs a chef at Coco Roco who makes poor quality food (the "incompetence imputation").

238. In due course, the matter came before another judge of the Common Law Division (Harrison J) for the assessment of damages and determination of defences raised by the present respondents. His Honour’s decision of 18 December 2009[204] was that the appropriate quantum of damages was $80,000 for each of the appellants but that each imputation, in the context of the matter complained of as a whole, would have been understood by the reader to have been conveyed as a statement of opinion, so that a defence of comment applied (there were also certain findings that a defence of truth applied). Harrison J therefore ordered verdict and judgment for the present respondents as defendants.

     204. Gacic v John Fairfax Publications Pty Ltd [2009] NSWSC 1403.

239. The appellants again appealed to this Court which, on 24 November 2011, held that Harrison J had erred on both the matter of defences and the assessment of damages, ordered a verdict for the appellants and remitted the matter to the Common Law Division for assessment of damages. [205] An application for special leave to appeal to the High Court was dismissed on 22 June 2012. [206] It was as a consequence of the remitter by this Court that Hall J came to address the question of damages and to make the decision from which this present appeal is brought. His Honour’s substantive decision was delivered on 19 December 2013. [207]

     205. Gacic v John Fairfax Publications Pty Ltd [2011] NSWCA 362.

     206. John Fairfax Publications Pty Ltd v Gacic [2012] HCATrans 168.

     207. Gacic v John Fairfax Publications Pty Ltd [2013] NSWSC 1920

240. It is against that background that the appellants contend that the first respondent engaged in “conscious wrongdoing in contumelious disregard of” the plaintiff’s rights by continuing to make the defamatory material available after 14 June 2007 to anyone who resorted to the internet and keyed in certain search terms. The first respondent’s response is, first, that the fact that special effort (in the form of entry of search terms) was needed in order to locate the material mitigates the effects of the material’s continuing availability; second, that purging of historical acts found subsequently to be wrong cannot be compelled by threat of exemplary damages; and, third, that there is a distinction between a publication first made with knowledge of its falsity and in contumelious disregard of the plaintiff’s rights and a publication which later turns out to be wrongful.

241. There was, in the course of submissions, debate about a hypothetical situation where a book containing defamatory material is published and sold and copies come to rest indefinitely on library shelves; or a magazine with defamatory content is available in doctors’ and dentists’ waiting rooms for an extended period. The first respondent says that the publisher cannot be expected to extirpate such copies. The appellants’ response is that these circumstances are distinguishable from those of the present case because the person responsible for the defamatory content of the book or magazine has no control over the physical items once they reach the hands of strangers, whereas the first respondent at all times controlled what was put on to the website and remained on it.

242. The first respondent pointed out that the offending material and references to its substantive message are available on the internet otherwise than in what I might term the primary form of the restaurant review posted on the SMH Good Living website. There are, for example, references to it in articles on websites containing other media organisations’ reports of court proceedings and judgments and, indeed, on court and other legal websites containing the full text of judgments.

243. It is not contended, of course, that the first respondent can in any way control the content of court and legal publishers’ websites or those of other newspapers. To the extent that the relevant material, as contained or referred to in other publications, continues to be accessible on those websites, that is not something for which responsibility can be sheeted home to the first respondent.

244. But the first respondent is directly and obviously responsible for the content of the SMH Good Living website. It has direct and obvious control over that content. It exercised that control on three occasions of relevance for present purposes: first, when it caused the material in question to be put on to the website on 30 September 2003; second, when it caused the material to be removed from the website on 30 June 2006; and, third, when it caused the material to be put back on to the website on 14 June 2007, after the High Court had determined that certain of the content was defamatory of the appellants.

245. It was said in Dow Jones & Co Inc v Gutnick [208] that defamation occurs where the relevant material is available in comprehensible form and that, in the case of material on the internet, it is available in comprehensible form when it is downloaded by a person who “has used a web browser to pull the material from the web server”. It follows that a new cause of action arises on each occasion of such downloading, even though rules about multiplicity of proceedings may preclude suing upon each and every such cause of action. In that connection, it is pertinent to quote from the judgment of Gleeson CJ, McHugh, Gummow and Hayne JJ in Dow Jones & Co Inc v Gutnik:[209]

“Clearly the common law favours the resolution of particular disputes between parties by the bringing of a single action rather than successive proceedings. The principles of res judicata, issue estoppel, and what has come to be known as Anshun estoppel all find their roots in that policy. The application of that policy to cases in which the plaintiff complains about the publication of defamatory material to many people in many places may well lead to the conclusion that a plaintiff cannot bring more than one action in respect of any of those publications that have occurred before the proceeding is instituted or even, perhaps, before trial of the proceeding is complete. Effect can be given to that policy by the application of well-established principles preventing vexation by separate suits or, after judgment, by application of the equally well-established principles about preclusion, including principles of Anshun estoppel.” (footnotes omitted)

208. [2002] HCA 56; 210 CLR 575 at [44].

209. At [36].

246. A plaintiff theoretically entitled to commence multiple defamation actions is thus compelled to exercise restraint. The policy of the law to which the High Court referred does not favour the commencement of 100,000 actions by a person defamed in a newspaper of which 100,000 copies were sold, to quote the example given by Asprey JA in McLean v David Syme & Co Ltd. [210] A single proceeding should be the vehicle for full vindication.

     210. (1970) 72 SR (NSW) 513 at 519.

247. A like expectation of restraint affects a defendant. Once it has been determined that particular matter is defamatory of a plaintiff and that no defence is available, the defendant who has been found to have engaged in tortious conduct by publication of that matter cannot, with impunity, commit the same wrong again. Damages for defamation are not a form of licence fee according to some “efficient breach” theory of tort. The judicial determination establishes that further publication of the same matter in the same way will also be unlawful and that new causes of action will accrue on each occasion of such further publication. A defendant who does not heed and act upon the message conveyed by the original judicial determination but instead makes a deliberate choice to continue with the commission of the same wrong and thereby to continue to infringe the plaintiff’s rights acts in contumelious disregard of those rights. That defendant’s conduct is highhanded conduct of a grave kind that merits punishment or deterrence. In addition and as Spigelman CJ observed in TCN Channel Nine Pty Ltd v Anning, [211] the power of the mass media is a material consideration when determining whether conduct should be punished or deterred.

     211. [2002] NSWCA 82; 54 NSWLR 333 at [183].

248. The defamatory quality of the content of the restaurant review was authoritatively determined on 14 June 2007, the date of the High Court’s decision. The jury’s determination of 19 September 2007 was that the defamation was even more extensive. Questions of possible defences remained. The decision of Harrison J on 18 December 2009 favoured the respondents in that respect but that decision was reversed by this Court on 24 November 2011. From that point (or, I suppose, from the point at which the High Court refused special leave on 22 June 2012), the status of the restaurant review as an unjustified and indefensible libel of the appellants was established and indisputable.

249. Whatever may be said to have been the position at earlier stages while the possibility of defences was alive, the conduct of the first respondent after 22 June 2012 was highhanded conduct by an organ of the mass media. By keeping the restaurant review on the website, the first respondent continued to publish the defamatory content at times when it well knew that to do so was to invade the legal rights of the appellants. It is not to the point that the restaurant review could be accessed on the website only by persons who keyed in certain search terms. The most obvious such terms are the names of the appellants and the name of the restaurant. The continuing presence of the material on the website produced a result that was the equivalent of the first respondent’s simply handing a printed copy of the restaurant review to every person who asked for such information as the first respondent was able to give about one of the appellants or the restaurant. Disregard of persons’ rights does not cease to be contumelious just because it occurs in response to an inquiry or question.

250. In any event, the argument that only those who actively search will find the material on the website overlooks what Lyrissa Barnett Lidsky, in her article, "Silencing John Doe: Defamation and Discourse in Cyberspace", [212] has called the “extraordinary capacity of the Internet to replicate almost endlessly any defamatory message.”

     212.    (2000) 49 Duke Law Journal 855 at 65.

251. Also, it is beside the point that the same content could be accessed on websites maintained by other persons in, for example, news items about the proceedings or reports of judgments. In those cases, context is added – often, no doubt, context indicating that publication of the content by the respondents had been found to be tortious.

252. Nor, in my opinion, is it relevant that the appellants had not taken strenuous steps (by application for an injunction or otherwise) in an attempt to persuade the first respondent that it should remove the material from the website. The action of a wrongdoer in continuing his or her wrongdoing after it has been conclusively determined to be of that quality does not vary in complexion according to whether the wronged party is or is not vociferous in demanding that the wrongdoer desist.

253. It remains to refer to the two other matters put forward by the first respondent, namely, that purging of historical acts found subsequently to be wrong cannot be compelled by threat of exemplary damages; and that there is a distinction between a publication first made with knowledge of its falsity and in contumelious disregard of the plaintiff’s rights and a publication which later turns out to be wrongful. In relation to those matters, it is necessary to refer again to the unusual nature of the proceedings which, in their various phases, extended over some ten years. Damages came to be assessed in December 2013 in circumstances where there had existed for some eighteen months a definitive determination making it plain that not only the original publication but also the further publications made after that definitive determination constituted disregard of the appellants’ rights. In that particular context, the disregard of those rights by means of the further publications is properly viewed as contumelious.

254. The case was one in which exemplary damages should have been awarded. Bearing in mind that, for the reasons mentioned, only publication outside New South Wales is relevant to this part of the case, I am of the opinion that the damages payable to each appellant by the first respondent should have included an additional $20,000 by way of exemplary damages, with the judgment for the additional sum having retroactive operation as described by McColl JA.

255. I next refer to the cross-appeal and the matter of mitigation on which McColl JA and Macfarlan JA take different views. On that, I prefer the outcome favoured by McColl JA because, although the matters relied on are properly regarded as facts, they are facts having substantial evaluative content based on the assessment of one person only – and facts, moreover, the impact of which is blunted by evidence that persons other than the second respondent enjoyed favourable dining experiences at the restaurant and that the second respondent himself was complimentary about some of the food. In those circumstances, there are mitigatory facts but their effect is not great.

256. In relation to the balance of the issues before the Court, I agree with McColl JA.

257. Orders should be made as McColl JA proposes.

*********

Endnotes

Amendments

21 August 2015 - correction to the following footnotes:

at [146], deletion of "[2012] NSWCA 58" and insertion of that citation into a new footnote at [130]

at [192], deletion of "[2006] NSWCA 227" and insertion of that citation into the existing footnote [now fn 165] immediately following "John Fairfax Publications Pty Ltd v Zunter".

28 April 2015 - Order 3 amended.

17 April 2015 - Spelling of parties' names corrected on coversheet