Gutnick v Dow Jones and Company Inc
[2003] VSC 79
•21 March 2003
| IN THE SUPREME COURT OF VICTORIA | Not Restricted | |
AT MELBOURNE
COMMON LAW DIVISION
MAJOR TORTS LIST
No. 7763 of 2000
| JOSEPH GUTNICK | Plaintiff |
| V | |
| DOW JONES AND COMPANY INC | Defendant |
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JUDGE: | Bongiorno J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 13 & 14 May 2002 | |
DATE OF JUDGMENT: | 21 March 2003 | |
CASE MAY BE CITED AS: | Gutnick v Dow Jones & Co. Inc (No.2) | |
MEDIUM NEUTRAL CITATION: | [2003] VSC 79 | |
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Tort – defamation – pleading – plaintiff's imputations – defendant's imputations – Hore-Lacy/Polly Peck – choice of law – internet publication – qualified privilege – Lange qualified privilege – fair report of legal proceeding – striking out.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr J. L. Sher QC with Mr M. F. Wheelahan | Schetzer Brott Appel |
| For the Defendant | Mr T. F. Robertson SC | Roth Warren as agents for Gilbert & Tobin Sydney |
HIS HONOUR:
By a writ issued on 27 November 2000 the plaintiff claims damages for defamation against the defendant in respect of the publication by it of certain material on an Internet web site identified as wsj.com and in a magazine called “Barrons” at the end of October 2000. This ruling is concerned with attacks made by each party upon the others’ pleadings as those pleadings stood in November 2001, that is to say the plaintiff’s Further Amended Statement of Claim and the defendant’s Defence.
By a summons filed on 19 November 2001 the plaintiff seeks to have a number of paragraphs of the defendant's Defence dated 14 November 2001 struck out pursuant to RSC r 23.02. By a similar summons filed on 22 November 2001 the defendant makes a similar application in respect of various paragraphs of the then current version of the plaintiff's Statement of Claim namely his Further Amended Statement of Claim dated 24 April 2001.
These summonses were heard together by me on 13 and 14 May 2002. However, at the time they were heard, there was an appeal by the defendant pending before the High Court of Australia in respect of a judgment of Hedigan J delivered on 28 August 2001[1] (from which the Court of Appeal had refused leave to appeal) by which his Honour had dismissed applications by the defendant to set aside service of the Writ upon it and/or to stay the proceeding on the ground that this Court was not a convenient forum.
[1][2001] VSC 305
Upon considering the matters raised by the argument before me during and after the hearing in May it became apparent that a number of issues could not be definitively resolved until the High Court delivered its judgment in the appeal to which I have referred. Accordingly I deferred these rulings until the High Court delivered its judgment to lessen the possibility of further fragmentation of this case by interlocutory appeals.
On 10 December 2002 the High Court delivered judgment in that appeal upholding Hedigan J's decision as to this Court’s jurisdiction (and thus the validity of service of the Writ) and as to this Court being a convenient forum in which the plaintiff's claim might be litigated.
Following delivery of the High Court judgment Mr Wheelahan, junior counsel for the plaintiff, sought leave to file further short written submissions on behalf of the plaintiff consequent upon the High Court's decision. He was given leave to file such submissions by 20 December 2002 and the defendant was given leave to reply to them, should it be so advised, by 13 January 2003. In the event, short submissions with a proposed Second Further Amended Statement of Claim were provided by the plaintiff on 18 December 2002. The defendant's solicitor informed my associate that it did not wish to make any further submissions in answer to the plaintiff's submissions of 18 December 2002.
The Second Further Amended Statement of Claim does no more than recast the imputations which the plaintiff alleges arise from the part of the article published by the defendant of which he complains in terms discussed during the hearing to clarify the plaintiff's case. It does not materially change the plaintiff’s case. I had in fact granted leave to the plaintiff to amend his then Further Amended Statement of Claim in the course of the hearing. [2]
[2]See transcript pages 114-5 and 144-5. The draft of the document submitted by counsel for the plaintiff with their supplementary submissions of 18 December 2002 contains a word processing error in that the paragraph numbering has been inappropriately altered from that in the immediately previous version of the Statement of Claim (Further Amended Statement of Claim.) I have ignored the error for the purpose of these rulings and have treated the document as if the paragraphs had been correctly numbered.
THE PLAINTIFF'S SUMMONS
The plaintiff's summons seeks the striking out of six paragraphs of the defendant's Defence, namely paragraphs 8, 9, 10, 11, 12 and 14. It seeks such relief pursuant to RSC r 23.02
Paragraph 8
Paragraph 8 of the defendant's Defence appears under a heading "Law of the United States of America". It alleges that the proper law to be applied to the plaintiff's claim is the law of New Jersey for Internet publication and the law of New York for print publication. It proceeds to allege that by both of these laws the claim is defensible on four separate principles. Those principles, referred to as “affirmative defenses” (sic), are recognisable as American variants of pleas, some of which might be available under the law of Victoria.
The plaintiff's argument with respect to paragraph 8 is that as Hedigan J decided that the place of publication of the alleged libels the subject of this proceeding was Victoria and that therefore the tort complained of was committed in Victoria, there is no room now to argue that the law of New Jersey and/or the law of New York should be applied to the determination of the proceeding. The defendant argued that, notwithstanding Hedigan J's decision, no res judicata or issue estoppel was created. It argued that unless the question is clear beyond argument the choice of law issue should be determined only upon or after a trial of what are said to be contentious issues of fact.
Whatever might have been the position prior to the determination of the defendant's appeal from Hedigan J's judgment to the High Court the question is now beyond argument. Early in the joint judgment of Gleeson CJ, McHugh, Gummow and Hayne JJ the following statement appears: -
". . . it is now established that in trying an action for tort in which the parties or the events have some connection with a jurisdiction outside Australia, the choice of law rule to be applied is that matters of substance are governed by the law of the place of commission of the tort. Neither party sought to challenge (this) proposition."[3]
[3][2002] HCA 56 para 9
The Court referred to Regie National Des Usines Renault SA v Zhang[4].
[4](2002) 76 ALJR 551; 187 ALR 1
Towards the end of the same judgment the following statement appears:-
". . . Mr Gutnick has sought to confine his claim in the Supreme Court of Victoria to the damage he alleges was caused to his reputation in Victoria as a consequence of the publication that occurred in that State. The place of commission of the tort for which Mr Gutnick sues is then readily located as Victoria. That is where the damage to his reputation of which he complains in this action is alleged to have occurred, for it is there that the publications of which he complains were comprehensible by readers. It is his reputation in that State, and only that State, which he seeks to vindicate. It follows, of course, that substantive issues arising in the action would fall to be determined according to the law of Victoria. But it also follows that Mr Gutnick’s claim was thereafter a claim for damages for a tort committed in Victoria, not a claim for damages for a tort committed outside the jurisdiction.”[5]
[5][2002] HCA 56 at para 48
The question of choice of law in this proceeding is accordingly thus determined. Paragraph 8 of the defendant's Defence serves no useful purpose and should be struck out.
Paragraph 9
By paragraph 9 of its Defence under a heading "Hore-Lacey to Plaintiff's Extract Article" the defendant seeks to justify its publication of the matter complained of by the plaintiff by alleging meanings different to those pleaded by him in his Statement of Claim.
The four imputations upon which the plaintiff sues as arising from the relevant article are contained in paragraph 5 of his Further Amended Statement of Claim. That paragraph is as follows:-
" 5.In their natural and ordinary meaning the words meant and were understood to mean that the plaintiff:-
(a)was a customer of Nachum Goldberg who had recently been imprisoned for tax evasion and money laundering; and
(b)was Nachum Goldberg's biggest customer; and
(c)was masquerading as a reputable citizen when he was, in fact, a tax evader who had laundered large amounts of money through Nachum Goldberg; and
(d)had bought Nachum Goldberg's silence so as to conceal his identity as one of Goldberg's customers."
Those imputations have been reformulated in the plaintiff's Second Further Amended Statement of Claim as follows:-
"5.In their nature and ordinary meaning the words meant and were understood to mean: -
(a)was a customer of Nachum Goldberg who had recently been imprisoned for tax evasion and money laundering; and
(b)was the biggest customer of Nachum Goldberg who had recently been imprisoned for tax evasion and money laundering; and
(c)was masquerading as a reputable citizen when he was, in fact, a tax evader who had laundered large amounts of money through Nachum Goldberg; and
(d)had bought Nachum Goldberg's silence so as to conceal his identity as one of the customers of Goldberg who had recently been imprisoned for tax evasion and money laundering."
The second version of paragraph 5 quoted does no more than clarify (if clarification was in fact needed) the imputations pleaded by the plaintiff as arising from the material in the relevant article which he says was defamatory of him. That my understanding of the new pleading is as I have set out is reinforced by the fact that the defendant did not avail itself of the opportunity to make any new submission in respect of it following the supplementary submission of the plaintiff of 18 December 2002 as it was entitled to do.
In its plea of justification made in paragraph 9 of its Defence the defendant asserts that the matter complained of by the plaintiff meant that:-
"(a)the Plaintiff masquerades as a reputable business man but hypocritically and dishonestly takes advantage of religious charities for personal gain;
(b)alternatively, the Plaintiff has been masquerading as a reputable citizen when he was a dishonest businessman reasonably suspected of involvement with Nachum Goldberg, a convicted tax invader who used religious charity as a front and Judah Wernick, a US businessman facing stock manipulation charges in the US. The Plaintiff has hypocritically used his relationship with various religious charities for his own unlawful financial advantage and has striven to keep these dishonest business dealings secret, . . . "
As the defendant impliedly concedes by the heading it placed upon this part of its Defence, the law of Victoria with respect to the pleading by a plaintiff of imputations or false innuendos, the extent to which a plaintiff can go beyond his pleaded meanings in making out his case and the limits imposed upon a defendant who contends that the allegedly defamatory publication has meanings other than those asserted by the plaintiff is to be found in David Syme & Co. Ltd v Hore-Lacey[6], a case which explained and applied the High Court decision of Chakravarti v Advertiser Newspapers Ltd[7].
[6](2000) 1 VR 667
[7](1998) 193 CLR 519
The effect of Hore-Lacey is to confine a plaintiff who pleads specific meanings by way of false innuendos or imputations to a case which relies upon those meanings or, at least, relies upon meanings which are not substantially different from those pleaded and are no more injurious than the meanings pleaded. The majority (Ormiston and Charles JJA) imposed upon a defendant who sought to justify an allegedly defamatory publication the restriction that he could do so only in respect of the meanings alleged by the plaintiff or variants thereof which were no more injurious than those pleaded by the plaintiff. RSC rr 13.07 (1) and 13.10 require the defendant to plead justification in terms which make clear the version of meaning which he is seeking to justify. A failure to do so breaches those rules.
The question to be determined then in respect of the plaintiff's application to strike out paragraph 9 of the defendant's Defence is whether, in pleading the meanings of the allegedly defamatory publication which it does, the defendant has pleaded meanings which it would be open to the tribunal of fact to find were permitted variants of the case made by the plaintiff or whether the defendant has gone further so as to infringe the principle in Hore-Lacey. If it has gone beyond such a pleading then it, or such parts of it as go beyond the applicable restriction, are liable to be struck out as tending to embarrass or delay the fair trial of the proceeding pursuant to RSC r 23.02(c).
The plaintiff argues that paragraphs 9(a) and (b) of the defendant’s Defence should both be struck out as being not open, embarrassing in form and outside the requirement laid down in Hore-Lacey for pleading a defendant's imputation. The defendant submits that paragraph 5 of the plaintiff's Further Amended Statement of Claim (particularly, perhaps, 5(c)), set out above) does plead an imputation sufficiently wide to be met by justifying one or other of the meanings pleaded by it in paragraph 9 of its Defence.
The plaintiff's case is that the parts of the article upon which he sues are defamatory of him because they accuse him of hypocrisy and dishonesty. But, he says, in doing so it makes five separate allegations against him, namely:-
•He was a customer of a convicted tax evader and money launderer (paragraphs 5(a) and (b));
•He was himself a tax evader and money launderer (paragraph 5(c));
•He was a hypocrite in that he masqueraded as a reputable citizen when he wasn’t (paragraph 5(c)) and
•He bought the convicted tax evader's silence to conceal his (the plaintiff's) identify (paragraph 5(d)).
The defendant agrees that the matter complained of by the plaintiff accuses him of dishonesty and hypocrisy, but does so by asserting that the words bear meanings other than those alleged by the plaintiff. The question is whether the imputations pleaded by the defendant meet the case made by the plaintiff.
There appear to be seven separate allegations concerning the plaintiff (five of them in the alternative) in paragraph 9 of the defendant's Defence. They are:-
• He masqueraded as a reputable business man;
•He was a hypocrite and dishonest in that he took advantage of religious charities for personal gain.
In the alternative:-
•He has been masquerading as a reputable citizen when he was a dishonest business man;
•He was reasonably suspected of involvement with a person (Goldberg) who used a religious charity as a front;
•He was reasonably suspected of involvement with another person (Wernick) who faced stock manipulation charges;
•He has used his association with religious charities for unlawful financial advantage; and
•He has striven to keep his dishonest association with religious charities for his own financial advantage secret.
The defendant argues that each of these imputations is derived from the article sued upon. But whether this is so or not is not to the point. The plaintiff is entitled to choose those charges against him which he says are made by the article upon which to sue and, provided he persuades the tribunal of fact that the article in fact carries those imputations (or permitted variants of them) and that they are defamatory, absent applicable defences, he will succeed in his action. A defendant cannot justify a libel by proving the truth of allegations, whether contained in the allegedly defamatory article or otherwise, upon which the plaintiff does not rely. Charles JA makes this point in Hore-Lacey[8]. He refers to Templeton v Jones[9] as a vivid example of the proposition.
[8]at 682
[9][1984] 1 NZLR 448
Applying these principles then to the above analysis of the parties' cases the following conclusions are reached:-
•The defendant's imputation that the plaintiff masqueraded as a reputable businessman is, arguably, not materially different (or is a permitted variant of) the plaintiff's imputation that he was a hypocrite in that he masqueraded as a reputable citizen. The distinction between "citizen" and "businessman" is a distinction without a difference in this context.
•The defendant's imputation that the plaintiff was a hypocrite and dishonest in that he took advantage of religious charities for personal gain does not meet any of the plaintiff's imputations. The plaintiff makes no reference to charities, religious or otherwise. The defendant’s imputation is more serious and of a different order to any of the plaintiff’s.
•The defendant's first alternative imputation that the plaintiff was masquerading as a reputable citizen when he was a dishonest businessman is a repetition, as part of an alternative plea, of the first imputation dealt with above. It is, arguably, not materially different or is a permitted variant of the plaintiff's imputation that he was a hypocrite in that he masqueraded as a reputable citizen. It would be a question for the tribunal of fact as to whether there was any material difference or impermissible variation.
•The defendant's imputation that the plaintiff was reasonably suspected of involvement with Nachum Goldberg, who was a convicted tax evader is, arguably, a permitted variant of the plaintiff's imputation that he was a customer of Goldberg’s or was his biggest customer.
•On the other hand the defendant's imputation that the plaintiff was reasonably suspected of involvement with Goldberg who used religious charities as a front bears no relationship to any imputation pleaded by the plaintiff. It seeks to link the plaintiff, not just to Goldberg, but to Goldberg having a particular (irrelevant) characteristic. It is, thus, a different libel.
•The defendant's imputation that the plaintiff was reasonably suspected of involvement with Judah Wernick, a US businessman facing stock manipulation charges in the US bears no relationship to any imputation pleaded by the plaintiff nor is it a permitted variant of any such imputation.
•The defendant's imputation that the plaintiff used his association with religious charities for unlawful financial advantage does not meet any of the imputations relied upon by the plaintiff, nor could it be a permitted variant of any of the plaintiff's imputations.
•The defendant's imputation that the plaintiff has striven to keep his dishonest business dealings secret does not meet the plaintiff's imputation that he had bought Goldberg's silence so as to conceal his identity as one of Goldberg's customers. The defendant’s imputation is far wider and materially different.
Despite there being some parts of the defendant's imputations which might be able to be put legitimately in answer to the plaintiff's case, having regard to the overall conclusions which I have reached it is appropriate to strike out the whole of paragraph 9 of the defendant's Defence whilst reserving leave to the defendant, if it be so advised, to recast those imputations which are capable of being an answer or partial answer to the plaintiff's claim in an appropriate form. In due course I will make such an order.
Paragraph 10
In paragraph 10 of its Defence under a heading "Polly Peck Defence to Whole Article" the defendant pleads that the matter complained of by the plaintiff was published within other material constituting an entire article, being the article entitled "Unholy Gains" scheduled to the Defence. The pleading goes on to assert a meaning to the whole of the article which, it is sufficient for present purposes to say, does not accord with any of the imputations pleaded by the plaintiff as arising from the article.
In its argument the defendant submits that David Syme & Co. Ltd v Hore-Lacey[10] was wrongly decided, but goes on to make an argument that the imputation pleaded in paragraph 10 is a permissible variant which the defendant should be entitled to contend for because of the plaintiff's failure to confine his imputations to the literal sense of the matter complained of.
[10](2000) 1 VR 667
As Hedigan J observed in his judgment of 28 August 2001 on the issues of jurisdiction and forum non conveniens in this case, it is self evident that the plaintiff does not allege that the whole article is defamatory of him. He sues upon "the words" which are defined in paragraph 4 of his Further Amended Statement of Claim as being the words and pictures set out in the schedule to that document. He is entitled to do this: see Templeton v Jones[11]; Broadcasting Corporation of New Zealand v Crush[12]. It is only where a reading of the whole of an article might alter or qualify a defamatory meaning conveyed by only part of the article that the plaintiff will be required to set out the whole article or other published material. Hedigan J referred to the dictum of Gowans J in Kasic v ABC[13]: See also Rubenstein v Truth and Sportsman Ltd[14] per Adam J at 474 and Kerney v Optimus Holdings Pty Ltd[15] per Menhennitt J at 401.
[11][1984] 1 NZLR 448
[12][1988] 2 NZLR 234
[13][1972] VR 702 at 706
[14][1960] VR 473
[15][1976] VR 399
As the defendant correctly observes in its submissions, this Court is bound by the Court of Appeal decision in Hore-Lacey[16] to which reference has already been made. The plea of justification contained in paragraph 10 of the defendant's Defence could only constitute an arguable defence to the plaintiff's claim if it complied with the requirements laid down by the Court of Appeal in that case. It clearly does not. Whatever might have been its efficacy were Polly Peck[17] the law in Victoria, it does not constitute an arguable defence as the law presently stands. It should be struck out.
[16](2000) 1 VR 667
[17]Polly Peck v Telford [1986] 1 QB 1000
Paragraph 11
In paragraph 11 of its Defence the defendant claims that the article containing the material in respect of which the plaintiff complains was published on an occasion of qualified privilege. It sets up qualified privilege in two specific forms: qualified privilege at common law deriving from a duty to publish and a corresponding interest in readers to be informed and qualified privilege, commonly called Lange qualified privilege, where the occasion of qualified privilege is derived from implications in the Australian Constitution concerning the freedom to publish discussion of government and political matters. The principle was developed in cases such as Nationwide News Pty Ltd v Wills[18], Australian Capital Television Pty Ltd v The Commonwealth[19], Theophanous v The Herald and Weekly Times Ltd[20] and, most importantly, Lange v Australian Broadcasting Corporation[21].
[18]1992 177 CLR 1
[19]1992 1777 CLR 106
[20]1994 182 CLR 104
[21](1997) 189 CLR 520
Common Law Qualified Privilege
Under traditional common law principles reciprocity of interest or duty is required to found a claim of qualified privilege in answer to a defamation[22]. The plaintiff submits that there is generally no sufficient reciprocity of interest and duty where the publisher of defamatory material is "a media defendant". He says that such a defendant can avail itself of the defence of qualified privilege only in exceptional circumstances and relies upon a number of authorities which, he contends, establish or illustrate that proposition.[23] He excepts those situations where the defamatory material is published as a reply to an attack.[24]
[22]Adam v Ward [1917] AC 309
[23]Lange v ABC (1997) 189 CLR 520 at 570; Duncombe v Daniell (1837) 173 E.R. 470 at 472; Adam v Ward [1917] AC 309; Smiths Newspaper Limited v Becker (1932) 47 CLR 279 at 304; Radio 2UE Sydney Pty Ltd v ParkerI (1992) 29 NSWLR 448 at 461;Heytesbury v City of Subiaco (1998) 19 WAR 440 at 453; Vilo v John Fairfax and Sons Ltd [2000] NSWSC 937 at para 18; Reynolds v Nationwide News Pty Ltd [2001] WASC 116 at para 41; Marsden v Amalgamated Television Services Pty Ltd [2001] NSW SC 510; Anderson v Nationwide News Pty Ltd [2001] VSC 335
[24]Morosi v Mirror Newspapers (1977) 2 NSWLR 749; Adam v Ward [1917] AC 309; Chapman v Lord Ellesmere [1932] 2 KB 431; Lang v Willis (1934) 52 CLR 637; Loveday v Sun Newspapers Ltd(1938) 59 CLR 503 at 516, 519; Kennett v Farmer [1988] VR 991; Marks v Construction, Mining, Energy, Timberyards, Sawmills and Woodworkers Union of Australia (WA) (1995) 14 WAR 360.
In particulars of this aspect of its Defence of qualified privilege the defendant asserts that it had a duty or interest in informing its readership of certain matters concerning the plaintiff. It does not define with any precision the basis of such duty or interest nor does it seek to define the correlative interest or duty in its readership to receive such information. In its submissions on this application however, it referred extensively to the fact that its readers were, inter alia, merchant bankers, stock brokers and professional investors who paid for the information provided. It relied upon Bashford v Information Australia (Newsletters) Pty Ltd[25]. In that case the New South Wales Court of Appeal considered the question of qualified privilege insofar as it might affect a subscription service which disseminated information on occupational health and safety. Whilst recognising that "one cannot create a licence to oneself to defame other persons by undertaking a contractual obligation to supply information" Hodgson JA, who wrote the principal judgment, considered that the existence of a contract between a subscriber and a subscription service (such as might exist in this case) supports the existence of a duty of communication where there is truly a public interest in the communication being made.
[25][2001] NSWCA 470
The inadequacy of the particulars supplied by the defendant in respect of its plea of what I have referred to as common law qualified privilege makes it impossible to say whether it will be able to establish that defence or not. However, the expansion of its case in its submissions on this application leads me to conclude that it might be able to establish sufficient reciprocity of interest and duty with its readers, or some of them, so as to make out the defence. The defence cannot be said to have no chance of success. Having regard to the test which I must apply to determine whether a pleading should be struck out under RSC r 23.02, it should not be struck out.
It may be that, having regard to the fact that whether or not a libel is published on an occasion of qualified privilege is a question of law[26], strict adherence to the rules of pleading would require the facts upon which that legal conclusion is alleged to rest to be pleaded so that they may be admitted, traversed or otherwise pleaded to by the defendant. However, as the defendant has pleaded its case in a common form supported by particulars (to which no objection as to form has been taken by the plaintiff) the adequacy of those particulars to put the plaintiff on notice as to the defendant's case can be examined to see whether an appropriate factual basis for finding an occasion of qualified privilege exists.
[26]Hebditch v MacIlwaine [1894] QB 54; Adam v Ward [1917] AC 309 at 318
Some of the matters referred to by Mr Robertson in his submissions, such as the fact that there was a contract between at least some readers of the matter alleged to be defamatory and the defendant and the terms of that contract, are not referred to in the particulars given under paragraph 11. There are no particulars of the facts from which it might be concluded that the relevant publication occurred on an occasion of qualified privilege. Further, the particulars seek to establish qualified privilege in respect of matters which are irrelevant to the plaintiff's claim.
Accordingly I shall not strike out paragraph 11 of the defendant's Defence but will strike out paragraph (a) of the particulars given under that paragraph with leave to the defendant to supply appropriate particulars of the acts, facts, matters or circumstances by reason whereof it claims that the words complained of by the plaintiff were published on an occasion of qualified privilege.
Lange qualified privilege
The second part of the defendant's Defence of qualified privilege particularised in paragraph (b) of the particulars given under paragraph 11 of its Defence raises it in a completely different way. Those particulars assert that the article containing the words complained of by the plaintiff related to subjects of public interest which were also "political and government matters affecting the people of Australia".
In its submissions the defendant argues that as the plaintiff alleges that he has been accused of money laundering and the defendant seeks to justify a charge of tax evasion the discussion in the article is "intimately related to the affairs of government".
The extended concept of qualified privilege expounded in Langev Australian Broadcasting Corporation[27] commences from the position that the common law of defamation must conform to the requirements of the Constitution and that the constitutional implication of freedom of political discussion precludes an unqualified application in Australia of the English common law of defamation insofar as it provides no defence for the mistaken publication of defamatory matter concerning government and political matters to a wide audience. The High Court held in Lange that as far as the common law doctrine of qualified privilege, as expounded in Australia, was concerned it must now be seen as imposing an unreasonable restraint on that freedom of communication which "the common convenience and welfare of society"[28] now requires. Their Honours considered that the system of government prescribed by the Constitution would be impaired if a wider freedom for members of the public to give and to receive information concerning government and political matters was not recognised. The Court declared that each member of the Australian community has an interest in disseminating and receiving information, opinions and arguments concerning government and political matters that affect the Australian people.
[27](1997) 189 CLR 520
[28]TooGood v Spyring (1834) 149 ER 1044 at 1050
The constitutional implication of freedom of communication about government and political matters is grounded in the nature of representative government. However, that freedom of communication is not absolute. It is limited to what is necessary for the effective operation of that system of representative and responsible government provided for by the Constitution. In order to attract the extended qualified privilege expounded in Lange there must be a nexus between the subject being discussed in the allegedly defamatory words and the concepts of representative government. As Spigelman CJ pointed out in John Fairfax Publications Pty Ltd v Attorney General (NSW)[29] in discussing the scope of the constitutional freedom relating to "governmental or political matters", it was not the intention of the High Court in Lange to extend the scope of the constitutional freedom to discuss such matters beyond that necessary for the proper working of representative government.
[29](2000) 181 ALR 694 at 710
In the present case the defendant contends that the fiscal offences referred to in both the plaintiff's imputations and those contended for by it are intimately related to the affairs of government. But to say this is to say no more than that Government is interested in the collection of taxes and the enforcement of the criminal law. There is no nexus between notions of representative government and a discussion of the plaintiff's alleged fiscal improprieties or criminal activities. In its widest sense the political process impinges on almost every aspect of a citizen's life. But that is not to say that a discussion of anything which might conceivably be part of the political process should attract the extended qualified privilege with which Lange was concerned. If political or “Lange” qualified privilege was not confined by a concept somewhat narrower than merely a discussion of a subject which was of relevance to government there would be scarcely an area of human activity which would be outside its reach. The limiting factor must be that the discussion sought to be protected must not only be of a subject relevant to the political process but also one relevant to the existence and operation of representative government.
In this case there is no sufficient nexus between the concept of representative government, as that term is used in Lange, and the defamation alleged by the plaintiff. Nor, for that matter, is there a sufficient nexus between the whole article of which such defamation is alleged to be part and the concept of representative government as explained in Lange. For those reasons the defence of qualified privilege as it is sought to be particularised in paragraph (b) of the particulars given under paragraph 11 of the defendant's Defence is not sustainable. Accordingly that paragraph will be struck out without the defendant having leave to deliver any further particulars in this regard.
Paragraph 12
Under the heading "Fair Report" the defendant pleads a further ground of qualified privilege; that arising from a fair report of judicial proceedings.
In support of this plea the defendant contends that the article which contains the allegedly defamatory material is mainly concerned with an outline of the charges, evidence and sentences imposed by the County Court on Nachum Goldberg and three members of his family for Commonwealth offences. The article does not suggest that the plaintiff was ever mentioned in the course of the Goldberg prosecution and, certainly, the allegedly defamatory statements of which he complains could not be said to be part of a fair report of any legal proceeding. Nowhere does the article suggest that the plaintiff's relationship with Goldberg, his hypocrisy as a tax evader and money launderer, or his having bought Goldberg's silence were ever part of the criminal legal proceedings involving Goldberg and his family. Indeed the article is not, and does not purport to be, a report of legal proceedings: see Waterhouse v Station 2GB Pty Ltd[30]and Nationwide News Pty Ltd v Rogers[31] where although dealing with a statutory defence, the various requirements of a report of judicial proceedings are discussed. This defence is not arguable.
[30](1985) 1 NSWLR 58
[31][2002] NSWCA 71
Paragraph 12 of the defendant's Defence should be struck out.
Paragraph 14
By paragraph 14 of its Defence the defendant again alleges that this Court has no jurisdiction to hear and determine the proceedings against it. Having regard to the High Court's decision to which reference has already been made this defence is no longer tenable and should be struck out.
THE DEFENDANT'S SUMMONS
The defendant's summons seeks the striking out of paragraphs 3, 3AA, 3AB, 4, 5 and 6 of the plaintiff's Further Amended Statement of Claim.
In support of its contentions the defendant makes six submissions relating to various of the impugned paragraphs. For convenience I shall deal with each of these submissions in the order in which it was presented by Mr Robertson.
Paragraphs 3 to 6
The defendant contends that these paragraphs should be struck out because they do not plead the elements of the tort of defamation according to applicable United States law. Having regard to the conclusion reached by the High Court on the appeal from the judgment of Hedigan J of 28 August 2001[32] this submission is no longer maintainable, as indeed, Mr Robertson conceded would be the case if the High Court determined the case as it, in fact, did.
[32][2001] VSC 305
The only torts of which the plaintiff complains are torts which, he alleges, were committed in Victoria by the defendant either by publishing defamatory material concerning him on the Internet (paragraphs 3, 3AA and 3AB) or by publishing the same defamatory material in its weekly magazine "Barron's" (paragraph 3A). In the circumstances it would have been inappropriate for the plaintiff to plead the elements of the tort of defamation according to applicable US law. US law has nothing to do with this case. The defendant's submission must be rejected.
Paragraphs 3, 3AA and 3AB
The defendant contends that these paragraphs should be struck out because there was no Internet publication in law of the article in Victoria. This submission likewise fails because of the High Court decision.
Paragraph 4
The defendant contends that paragraph 4 of the plaintiff's Further Amended Statement of Claim should be struck out as it does not annexe the whole of the defendant's article which contained the alleged defamatory words upon which he is sued.
The defendant contends that there are two fatal flaws in the way in which the plaintiff has pleaded his case in paragraph 4. Firstly it says that a plaintiff cannot compel the hypothetical reader to have regard only to a part of the article in which the defamatory words were found. Secondly it says that it is open for the tribunal of fact to find that the complexion of the imputation conveyed by a libellous passage may be altered or qualified by other passages, and if so the plaintiff must set out all of those passages.
In answer to these contentions the plaintiff relies upon David Syme & Co. Ltd v Hore-Lacey[33], Templeton v Jones[34] and the two reports of Anderson v Nationwide News Pty Ltd[35]. In Ron Hodgson (Trading) Pty Ltd v Belvedere Motors (Hurstville) Pty Ltd[36]. Asprey JA enunciated a series of propositions the second of which was as follows[37]:-
"Secondly, if the alleged defamatory matter be contained within other written material, it is sufficient to set forth in the declaration the libellous passages only, provided that their meaning be clear and distinct. But, if the meaning of the passage taken singly is not clear, or if the complexion of the imputation conveyed by the libellous passages is materially altered or qualified by other passages in the written material the plaintiff must set out all of the passages in the written material which affect the sense of the alleged defamatory matter."
[33](2000) 1 VR 667
[34][1984] 1 NZLR 448
[35][2001] VSC 335 and [2002] VSC 18
[36][1971] 1 NSWLR 472
[37]at 477
His Honour relied upon Rainy v Bravo[38] as authority for the proposition which he stated. Indeed, in an earlier case, Cohen v Mirror Newspapers Ltd[39] the same judge had criticised, as too widely expressed, a passage in the sixth edition of Gatley on Libel and Slander which called upon a plaintiff to set out the whole of an article or letter in which defamatory words were contained. His Honour considered that the requirement to plead the whole of the article arose only where the whole of the article affected the sense of the alleged defamatory matter.[40]
[38](1872) L.R. 4 P.C. 287 at 296 97 and Tabart v Tipper (1808) 170 ER 981 at 983
[39][1965] NSWR 1484 at 1485
[40]See also A v Ipec Aust Ltd [1973] VR 39 per Menhennitt at 43
I did not understand Mr Robertson to be suggesting that here the whole of the article materially altered the meaning or sense of the passages relied upon by the plaintiff, but rather that is was inappropriate for the plaintiff to exclude much of the article which was at least critical and possibly libellous of him in other ways.
In my opinion there is nothing in the defendant's contentions. The plaintiff is entitled to plead his case in the way in which he has. Paragraph 4 should not be struck out.
Paragraph 5
The defendant submits that paragraph 5 should be struck out because the meaning or meanings pleaded in it are not conveyed by the matter complained of taken as a whole. It also says the paragraph should be struck out because, of the several imputations pleaded by the plaintiff, some are not capable of conveying a defamatory meaning.
Mr Robertson did not press his argument in respect of the imputations contained in paragraphs 5(a) and 5(b) (which are the subject of the amendment now expressed in the plaintiff’s Second Further Amended Statement of Claim to which reference is made in paragraph 7 above). He contended that the appropriate imputation is one of reasonable suspicion by prosecutors rather than one of fact, but conceded that it would be open to a tribunal of fact to find one or other of the imputations pleaded.
He did contend that the imputation pleaded in paragraph 5(c) doesn't arise from the article. However, the parts of the article annexed to the Further Amended Statement of Claim appear to me clearly to assert that the plaintiff was a money launderer and, by inference, a tax evader who masqueraded as a reputable citizen. In any event, ultimately it will be for the tribunal of fact to either accept or reject the imputation pleaded by the plaintiff. It is sufficient, at this stage, that it would be entitled to do so on a reading of the parts of the article relied upon by him.
Similarly, in paragraph 5(d) the plaintiff pleads an imputation that the article meant that he had bought Goldberg's silence. This is clearly an imputation open from a fair reading of that part of the article annexed to the plaintiff's Further Amended Statement of Claim. Whether the tribunal of fact is prepared to attribute that meaning as arising from that part of the article sued upon will be a matter for it.
There appears to be no substance in the defendant's attacks on paragraph 5 of the plaintiff's further amended statement of claim in as much as it alleges that the imputations pleaded are not conveyed by the matter complained of.
Finally the defendant contends that paragraph 5 in its entirety should also be struck out because where several imputations are pleaded, the pleading is bad in form if one or some of them are not capable of conveying a defamatory meaning.
As I have already determined that each of the imputations pleaded in paragraph 5 are capable of conveying a defamatory meaning this submission has no substance.
Accordingly, the defendant's summons fails in respect of each of the orders it seeks.
CONCLUSION
The Court will make the following orders:-
A. On the plaintiff's summons filed 19 November 2001:-
1. That paragraphs 8, 10, 12 and 14 of the defendant's Defence be struck out.
2.That paragraph 9 of the defendant's Defence be struck out with leave to the defendant to amend its Defence to plead justification in imputations permitted in accordance with these reasons.
3.That paragraph (a) of the particulars given under paragraph 11 of the defendant's Defence be struck out with leave to the defendant to deliver particulars of the acts, facts, matters or circumstances by reason whereof it alleges that the matter complained of by the plaintiff was published on an occasion of qualified privilege.
4.That paragraph (b) of the particulars given under paragraph 11 of the defendant's Defence be struck out.
5. That the defendant pay the plaintiff's costs of this summons.
6.That this order be drawn up by the solicitors for the plaintiff and signed by a Judge pursuant to RSC r 60.04.
B. On the defendant's summons filed 22 November 2001:-
1. That this summons be dismissed.
2. That the defendant pay the plaintiff's costs of this summons.
3.That this order be drawn up by the solicitor for the plaintiff and signed by a Judge pursuant to RSC r 60.04.
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