John Holland Group Pty Ltd v John Fairfax Publications Pty Ltd
[2006] ACTSC 108
JOHN HOLLAND GROUP PTY LIMITED and STEPHEN SASSE v
JOHN FAIRFAX PUBLICATIONS PTY LTD and ELIZABETH KAZI
[2006] ACTSC 108 (3 November 2006)
PRACTICE AND PROCEDURE – Defamation – Polly Peck defence – strike out – defence not known to law.
Defamation Act 1957 (Tas), s 18
John Holland Group Pty Ltd v John Fairfax Publications Pty Ltd [2006] ACTSC 34
Poly Peck (Holdings) Plc v Trelford [1986] QB 1000
Chakravarti v Advertiser Newspapers Limited (1998) 193 CLR 519
John Fairfax Publications Pty Ltd v Zunter [2006] NSWCA 227
Kelly v Nationwide News Pty Ltd (1998) 147 FLR 410
Steiner Wilson & Webster Pty Limited t/as Abbey Bridal v Amalgamated Television Services Pty Limited (2000) Aust Torts Reports 81-537, [1999] ACTSC 123
Woodger v Federal Capital Press of Australia Pty Ltd (1992) 107 ACTR 1
David Syme & Co Ltd v Hore-Lacy, [2000] VSCA 24
Western Australian Court of Appeal in Nationwide News Pty Ltd v Moodie [2003] WASCA 273
Advertiser-News Weekend Publishing Co Ltd v Manock (2005) 91 SASR 206, [2005] SASC 82
Drummoyne Municipal Council v Australian Broadcasting Corp (1990) 21 NSWLR 135
No. SC 650 of 2005
Judge: Connolly J
Supreme Court of the ACT
Date: 3 November 2006
IN THE SUPREME COURT OF THE )
) No. SC 650 of 2005
AUSTRALIAN CAPITAL TERRITORY )
BETWEEN:JOHN HOLLAND GROUP PTY LIMITED ACN 050 242 147
First Plaintiff
AND:STEPHEN SASSE
Second Plaintiff
AND:JOHN FAIRFAX PUBLICATIONS
PTY LTDACN 003 357 720
First Defendant
AND:ELIZABETH KAZI
Second Defendant
ORDER
Judge: Connolly J
Date: 3 November 2006
Place: Canberra
THE COURT ORDERS THAT:
Paragraphs 5(a) and 5(b) of the Defence of the first and second defendants be struck out.
The defendants pay the plaintiffs’ costs of this application.
This is an application to strike out certain paragraphs of a defence to a defamation action. The plaintiffs claim to have been defamed in an article written by the second defendant and published by the first defendant in the Australian Financial Review on 5 August 2005. The Australian Financial Review is a newspaper circulating throughout Australia, and the plaintiffs accordingly have in the appropriate manner sought relief in respect of publication in all jurisdictions. The first plaintiff, the corporation, pleads in respect of publication in each of the States and Territories other than New South Wales, and the second plaintiff pleads in respect of publication throughout Australia. There was an interlocutory challenge to the manner in which the plaintiffs pleaded imputations but this was dismissed after full hearing by order of the Master on 21 April 2006 (John Holland Group Pty Ltd v John Fairfax Publications Pty Ltd [2006] ACTSC 34).
I was advised at the commencement of this application that the proceedings in respect of the second plaintiff have been settled by way of an agreed sum of damages and an apology, so the matter proceeded only in respect of the corporate plaintiff.
The article was headed “Test of bosses’ right to spy”, and was an account of certain proceedings in the Federal Court in which it was asserted that certain things had occurred within the first plaintiff’s business under the direction of the second plaintiff, a senior executive in that company. The first plaintiff alleges that the matter complained of is, in its natural and ordinary meaning, defamatory of the first plaintiff. As pleaded and endorsed in the earlier proceedings by the Master, the imputations are said to be that:
8(a)The first plaintiff was a dishonourable company which sent a private investigator to tail Robert Serventi, monitored his confidential emails and chased his bank records;
(b)The first plaintiff employed as its general manager of industrial relations, the second plaintiff, who in relation to the surveillance of Robert Serventi conducted himself in a disgraceful manner and contrary to the appropriate standards expected of a public company;
(c)The first plaintiff’s monitoring of its employee Robert Serventi’s emails breached its own code of ethics which protected the right of employees to privacy;
(d)The first plaintiff permitted the second plaintiff to undertake an aggressive investigation into Mr Serventi including spying on his home, checking his bank records and monitoring his confidential emails, merely because the first plaintiff wished to restructure Mr Serventi’s position; and
(e)The first plaintiff employed as its general manager of industrial relations a man who spied on John Holland’s employee Mr Serventi’s emails for a reason as spurious as his own suspicion that Mr Serventi was behaving “mischievously”.
In its defence, now relevant only to the first plaintiff, the defendants deny that the matter complained of is capable of bearing or in fact bears any of the imputations pleaded by the first plaintiff, and that each of the first plaintiff’s imputations is capable of being or is in fact defamatory of the first plaintiff as alleged. They then seek to set up a defence that, in respect of publication in Tasmania it is said to be a defence of contextual imputation and in respect of publication in Queensland, Victoria, South Australia, Western Australia, the Northern Territory and the Australian Capital Territory, it is said to be a defence that the matter complained of in its ordinary and natural meaning, conveyed different imputations, which imputations were true in substance and fact.
The defence as pleaded for all parts of Australia save Tasmania amounts to what has become known as a Polly Peck defence, whereby a defendant pleads a different imputation from that contended for by the plaintiff, and then seeks to justify that different meaning. This approach was endorsed by the English Court of Appeal in Poly Peck (Holdings) Plc v Trelford [1986] QB 1000. However, it was subject to strong criticism in dicta by Brennan CJ and McHugh J in Chakravarti v Advertiser Newspapers Limited (1998) 193 CLR 519 at 526-530. Their Honours stated at 527 that the English approach was:
contrary to the basic rules of common law pleadings and in many contexts will raise issues which can only embarrass the fair trial of the action.
While these remarks were not endorsed by other members of the Court, intermediate appellate courts throughout Australia seem to have come to the view that the so-called Polly Peck defence is no longer known to our law. In John Fairfax Publications Pty Ltd v Zunter [2006] NSWCA 227, (per Handley JA, with whom Spigelman CJ and McColl JA agreed), the New South Wales Court of Appeal said (at [42]):
... there is no need to consider this defence in detail because at the present time the common law of Australia (John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 514) does not recognise it. It was rejected in Chakravarti v Advertiser Newspapers Ltd by Brennan CJ and McHugh J, in dicta which did not receive the express endorsement of the other members of the Court. However those dicta have been followed by intermediate appellate courts in Victoria (David Syme & Co Ltd v Hore-Lacy [2000] 1 VR 654), Queensland (Robinson v Laws [2003] 1 Qd R 81), Western Australia (Nationwide News Pty Ltd v Moodie (2003) 28 WAR 314), and South Australia (Advertiser-News Weekend Publishing Co Ltd v Manock (2005) 91 SASR 206). This Court should follow this line of authority and it would be inappropriate for us to re-examine the question. The Judge rightly rejected this defence.
Although the question has not yet been considered by our Court of Appeal, there have been two decisions by single Judges of this Court to the same effect. In Kelly v Nationwide News Pty Ltd (1998) 147 FLR 410, Gallop A-CJ said (at 421) that :
It seems to me that in the context of the issues which arose in Chakravarti, Brennan CJ and McHugh J were laying down the way in which the imputations to be determined at trial may be raised on the pleadings. The gravamen of their dicta is that the imputations to be determined may not be raised by way of pleading by the defendant.
In the circumstances, it would be courageous for any trial judge to ignore the dicta of their Honours in this area. I have come to the conclusion that the objections raised by the plaintiff to the proposed amendments to the defence should be upheld.
More recently, in Steiner Wilson & Webster Pty Limited t/as Abbey Bridal v Amalgamated Television Services Pty Limited (2000) Aust Torts Reports 81-537, [1999] ACTSC 123, Crispin J said (at [199]) that:
... whilst I acknowledge that the remarks of Brennan CJ and McHugh J in Chakravarti v Advertiser Newspapers Ltd were obiter, I must say, with great respect, that I share the misgivings which their Honours express.
It is true that in Woodger v Federal Capital Press of Australia Pty Ltd (1992) 107 ACTR 1, Miles CJ laid down clear guidelines as to how a Polly Peck defence might be pleaded in this jurisdiction. This decision, however, was before the High Court had spoken in Chakravarti, and before the clear endorsement of those views in intermediate appeals courts in other parts of Australia. It seems to me that, as a single judge on a strike out application, I should take the view that the Polly Peck defence has no part in the law of this Territory unless or until the High Court expresses a considered view on the question.
This does not however entirely dispose of the application. The line of authority from intermediate appeals courts in Victoria, South Australia and Western Australia seems to sanction a variant of the Polly Peck defence whereby a defendant may be permitted to plead and justify an alternative imputation only if it is one upon which the plaintiff might themselves obtain a verdict on the pleadings as they stand. This requires that the alternative imputation be close to or substantially similar to the meaning pleaded by the first plaintiff.
In Victoria in David Syme & Co Ltd v Hore-Lacy, [2000] VSCA 24, Charles JA said at [53]-[54]:
The principal criticisms of the practice sanctioned in Polly Peck, of permitting a defendant to plead and justify a meaning different from that contended for by the plaintiff are that such an approach allows the defendant to raise false issues which can only embarrass the fair trial of the action and will on occasions unfairly prevent a plaintiff from pursing a claim in defamation, in the manner explained by Brennan CJ and McHugh J in Chakravarti. The setting up of false issues by the defendant in this way may well make admissible a substantial body of evidence that would otherwise be irrelevant and thus greatly lengthen proceedings. But it seems to me that the same criticisms would not hold good if the defendant were limited to justifying a meaning which was one upon which the plaintiff might himself obtain a verdict on the pleadings as they stand.
Nor should a defendant be unfairly prejudiced if the defendant were limited to pleading a meaning which was sufficiently close (in the manner already suggested) to the plaintiff’s meanings, so that the plaintiff himself could succeed upon that meaning on the pleadings as they stand. If the defendant is limited to pleading a meaning on which the plaintiff would be permitted to go to the jury, a false issue is not thereby raised. The issues are instead identified and confined, to the benefit of the court and the parties. Of course, if the plaintiff cannot make good a meaning amongst those identified, his action must fail, and the defendant has no need to plead any other meaning.
Ormiston JA also accepted (at [22]) that:
... a defendant should not need to, nor be permitted to, plead or rely on a meaning other than one which is not more serious and otherwise is not substantially different ...
from the imputations pleaded by the plaintiff. This approach was endorsed by the Western Australian Court of Appeal in Nationwide News Pty Ltd v Moodie [2003] WASCA 273. There Steytler J said (at 328):
... the extent to which a defendant will be permitted to plead defamatory meanings different from those pleaded by the plaintiff will be constrained by the extent to which the plaintiff might himself or herself be permitted to rely, at the trial, upon imputations other than those pleaded by him or her.
The extent to which a modified Polly Peck defence may remain was more recently further clarified by the South Australian Full Court in Advertiser-News Weekend Publishing Co Ltd v Manock (2005) 91 SASR 206, [2005] SASC 82. There Doyle CJ, with whom Vanstone and White JJ agreed, said (at [72]):
I doubt whether the propositions formulated by Charles JA are inconsistent with the observations of Brennan CJ and McHugh J in Chakravarti about pleading a Polly Peck defence, because to the extent that a plaintiff may be permitted to depart from the meaning pleaded, fairness requires that the defendant be permitted to anticipate and deal with the alternative meaning. In that context the expression “alternative meaning” is something of a misnomer. An alternative meaning that can be pleaded and justified by the defendant can be no more than a shade or nuance of the meaning pleaded by the plaintiff, and so in substance (as it seems to me) the alternative meaning must be close to or the same as the meaning pleaded by the plaintiff.
I would, with great respect, endorse and apply the reasons of Doyle CJ. It seems to me that the factual context of that case well illustrates why this should be so. The action arose from a series of articles in the Adelaide Sunday Mail concerning forensic evidence in murder trials in that State. The plaintiff, Dr Manock, was a forensic pathologist, and former director of the State Forensic Science Centre. The plaintiff pleaded that the articles had cast imputations on his competence as a forensic scientist “in relation to murder trials”. The defendant pleaded that the article related to Dr Manock’s work as a forensic scientist more generally and were true in substance. In effect, it proposed to lead evidence about errors made by the plaintiff in the course of forensic enquires unrelated to murder trials. The trial judge and the Full Court were in agreement that this did not amount to a mere shade or nuance of meaning, but was an entirely separate claim. This must be correct. An assertion that a person has acted incompetently in giving evidence in murder trials, in which persons have been convicted of the most serious offence known to law, is not a mere variant of an assertion that a person has made errors in other aspects of their work. As Doyle CJ said, noting an observation by Gleeson CJ in Drummoyne Municipal Council v Australian Broadcasting Corp (1990) 21 NSWLR 135 at 137:
Almost any attribution of an act or condition to a person is capable of both further refinement and further generalisation.
To take an even more extreme example, if in a publication generally discussing the perils of dangerous driving causing injury and death, it was asserted that Mr or Ms X, a public official with some responsibility for such matters, had an appalling record for traffic offences, it might be pleaded by the plaintiff that an imputation from this was that they had been engaged in, or condoned, dangerous driving causing death. Assume that Mr X did in fact have a bad record for unpaid parking fines. The defendant should not be able to defend by pleading that the imputation was that Mr X had a record for not complying with traffic violations and assert the truth of the imputation by pointing to unpaid parking tickets. The alternative imputation is clearly not a mere shade or nuance of meaning on the alleged imputation of engaging in dangerous driving causing death. The plaintiff would either prove the imputation asserted and succeed, or fail to prove it and lose.
I am of the view that, as the law now stands, the only permissible alternative imputation that may be pleaded by a defendant in a defamation action is one that would otherwise be open to the plaintiff to succeed on the pleadings as they stand, that is, when it is a mere shade or nuance of meaning. In the present case, the imputations pleaded by the plaintiff, and which have survived a substantial interlocutory challenge, are that the plaintiff is a dishonourable company in that it monitors an employee’s emails and bank records, engages senior officers to spy on employees, and engages in surveillance of employees in a disgraceful manner. The alternative imputations sought to be pleaded here are that the plaintiff employed a person who, in relation to employees’ right to privacy, “conducted himself in a manner contrary to the appropriate standards” and that the company itself, in relation to employees’ right to privacy, conducted itself “contrary to the appropriate standards”.
These alternative imputations, it seems to me, are not a mere shade or nuance of meaning in comparison with the asserted imputations. Mr Blackburn SC, for the defendants, did not cavil with this proposition.
It follows that paragraph 5(b) of the defence should be struck out as it sets out an alternative imputation in an impermissible manner.
Paragraph 5(a) of the defence seeks to set out, in identical terms, what is said to be contextual imputation. This is said to be permitted by s 18 of the Defamation Act 1957 (Tas) which states:
Justification
18 In an action for defamation in respect of words containing two or more distinct charges against the plaintiff, a defence of justification does not fail by reason only that the truth of every charge is not proved if the words not proved to be true do not materially injure the plaintiff’s reputation, having regard to the truth of the remaining charges.
I do not see how this statutory provision, apparently unique to Tasmania, justifies the pleading of what is in effect a Polly Peck style of alternative imputation. There is no Tasmanian authority to justify such an approach. If the law is, as I understand it to be, that the pure Polly Peck defence forms no part of the Australian common law, and the significantly modified defence as explained in Hore-Lacy and Manock is that a defendant may only be able to plead an alternative imputation if it was one that would otherwise be open to a jury to find that would be available on the plaintiff’s own pleadings, and that amounts to a mere shade or nuance of the meaning pleaded by the plaintiff, I do not see how this common law would be modified by the Tasmanian statutory provision. I would accordingly strike out paragraph 5(a) of the defence.
The plaintiffs, having been entirely successful in this application, should have their costs.
I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment herein of his Honour, Justice Connolly.
Associate:
Date: 3 November 2006
Counsel for the plaintiffs: Mr BR McClintock SC
Solicitor for the plaintiffs: Colquhoun Murphy
Counsel for the defendants: Mr T Blackburn SC with Mr ATS Dawson
Solicitor for the defendants: Phillips Fox
Date of hearing: 30 October 2006
Date of judgment: 3 November 2006
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