Khan v Fairfax Media Publications Pty Ltd [No 3] - [2015] WASC 400

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: KHAN -v- FAIRFAX MEDIA PUBLICATIONS PTY LIMITED [No 3] [2015] WASC 400

CORAM: LE MIERE J

HEARD: 26 AUGUST 2015

DELIVERED : 29 OCTOBER 2015

FILE NO/S: CIV 1389 of 2014

BETWEEN: FAROOQ KHAN
Plaintiff
AND
FAIRFAX MEDIA PUBLICATIONS PTY LIMITED
First Defendant
JONATHAN BARRETT
Second Defendant

Catchwords:

Defamation - Justification - Qualified privilege - Particulars - Adequacy of defence and defence particulars - Pleadings - Strike out applications - Inadequacy of pleadings

Legislation:

Corporations Act 2001 (Cth)

Result:

Whole of the particulars of justification and certain paragraphs of the defence be struck out

Category: B

Representation:

Counsel:

Plaintiff:     Mr M L Bennett
First Defendant            :     Mr A T S Dawson
Second Defendant        :     Mr A T S Dawson

Solicitors:

Plaintiff:     Bennett + Co
First Defendant            :     Carmel Galati
Second Defendant        :     Carmel Galati

Case(s) referred to in judgment(s):

Agar v Hyde (2000) 201 CLR 552
Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158
Ange v Fairfax Media Publications Pty Ltd [2010] NSWSC 645
Ange v Fairfax Media Publications Pty Ltd [2011] NSWSC 204
Barclay Mowlem Construction Ltd v Dampier Port Authority [2006] WASC 281; (2006) 33 WAR 82
David Hunt v Times Newspapers Ltd [2012] EWHC 110 (QB)
Edward Hayson v John Fairfax Publications Pty Ltd [2007] NSWSC 763
Foley v Ashcroft [2012] EWCA Civ 423; [2012] EMLR 25
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125
Greek Herald Pty Ltd v Nikolopoulos (2001) 54 NSWLR 165
Howes v ACP Magazines Ltd [2013] NSWSC 1836
Khan v Fairfax Media Publications Pty Ltd [2014] WASC 451
Khan v Fairfax Media Publications Pty Ltd [No 2] [2015] WASC 221

LE MIERE J:

Overview

The plaintiff, Farooq Khan, is a director and the executive chairman of three listed public companies - Orion Equities Ltd, Queste Communications Ltd and Bentley Capital Ltd. He is the managing director of Orion and Queste. The first defendant is the publisher of the Australian Financial Review and maintains six websites which I will refer to as the 'Websites'. The second defendant is a journalist employed or retained by the first defendant. The plaintiff says that the second defendant wrote and both defendants published in the Australian Financial Review an article about the plaintiff under the headline 'King of the Under Performers'. On the front page of the edition which features the article was a photograph of the plaintiff with the caption 'Khan's Killing: The man behind the ASX's worst company'. I will refer to that article as the 'First Article'. The plaintiff says that the second defendant wrote and both defendants published on the Websites an article under the headline 'Farooq Khan: The man behind the ASX's worst‑performing listed investment company' which was in substantially the same terms as the First Article. I will refer to that article as the First Website Article. The plaintiff says that the second defendant wrote and both defendants published a further article in the Australian Financial Review about the plaintiff under the headline 'Khan and the mystery case of a beach house'. I will refer to that article as the Second Article. The plaintiff says that the second defendant wrote and both defendants published on each of the Websites an article under the headline 'Farooq Khan and the case of the beachside property' which was in substantially the same terms as the Second Article. I will refer to that article as the Second Website Article. The plaintiff claims that each of the articles is defamatory of him and claims an injunction restraining their further publication and damages including aggravated damages.
The current statement of claim is the further re‑amended statement of claim dated 17 June 2015 which follows partly successful applications to strike out previous versions of the statement of claim: Khan v Fairfax Media Publications Pty Ltd [2014] WASC 451 (Khan No 1) and Khan v Fairfax Media Publications Pty Ltd [No 2] [2015] WASC 221 (Khan No 2). The defendants filed a joint defence dated 1 July 2015 to the further re‑amended statement of claim. The plaintiff now applies to strike out parts of the defence.

The defence

The defendants admit that the second defendant wrote and both defendants published the First Article and the Second Article. The defendants admit that the first defendant made the First Article and the Second Article available on the AFR Website.
The defendants deny that any of the imputations pleaded by the plaintiff (Plaintiff's Imputations) arise from any of the articles complained of or that any of them is capable of being or is defamatory of the plaintiff.
The defendants plead that to the extent that it is found that any of the articles were defamatory of the plaintiff and/or carried any of the Plaintiff's Imputations and that those imputations are defamatory of the plaintiff, each of the Plaintiff's Imputations is substantially true. The defendants further and alternatively plead that to the extent that it is found that the First Article and First Website Article were defamatory of the plaintiff, the First Article and the First Website Article in their natural ordinary meaning meant and were understood to mean the alternative meanings pleaded in par 27 of the defence (First Alternative Meanings) and those meanings are substantially true. The defendants further plead and alternatively that to the extent that it is found that the Second Article and Second Website Article were defamatory of the plaintiff, those articles in their natural and ordinary meaning meant and were understood to mean the alternative meaning pleaded in par 28 of the defence (Second Alternative Meaning) and that meaning is substantially true. The defendants also plead that the matters complained of were published on an occasion of qualified privilege pursuant to the Defamation Act 2005 (WA) s 30.

The form of the defence

In par 26 the defendants plead justification to the Plaintiff's Imputations. In pars 27 and 28 the defendants plead the Polly Peck meanings and justification of those meanings. The defendants plead qualified privilege in par 29. After par 29 the defendants give particulars of justification and particulars of qualified privilege. The particulars have a somewhat idiosyncratic structure which counsel for the plaintiff, Mr Bennett, described as a flat pack format in that it is in a form which requires the reader to assemble the particulars relating to each imputation or alternative meaning in accordance with instructions included with the particulars. The first part of the particulars consists of the facts on which the defendants rely in support of their pleas of justification which are set out in 79 consecutively numbered paragraphs. After those paragraphs the particulars set out the Plaintiff's Imputations and the Alternative Meanings in groups. After each group of imputations or meanings the defendants identify which of the paragraphs numbered 1 to 79 of the particulars are relied upon in support of the plea of justification in relation to that group of imputations. After identifying the paragraphs of the particulars relied upon in relation to a group of imputations or meanings the defendants then set out the conclusions or inferences drawn from the facts which the defendants say justify the imputations.
The groups of imputations, identification of the fact paragraphs relied upon and the conclusions or inferences drawn from those facts are set out in unnumbered sentences or paragraphs which occupy three pages of the pleading. Counsel for the defendants, Mr Dawson, offered to amend the defence by numbering the unnumbered paragraphs. That should be done; it will make the pleading more readily comprehensible and make it easier for counsel and the court to refer to parts of the pleading or particulars. Such an amendment will make the defence conform to the rules which require every pleading, if necessary, to be divided into paragraphs numbered consecutively, each allegation being so far as convenient contained in a separate paragraph.

The plaintiff's strikeout application

The plaintiff applies to strike out each of par 26, 27 and 28 of the defence, that is the paragraphs which plead justification and par 1 to 79 of the particulars of justification
The plaintiff has two complaints about the defendants' particulars of justification. First, the defendants raise and rely upon extraneous and irrelevant material in purported justification of the Plaintiff's Imputations and the defendants' Alternative Meanings. Secondly, the particulars do not justify or arguably justify the sting of these imputations or alternative meanings.

Striking out defence - legal principles

The court may order to be struck out or amended any defence or anything in any defence on the ground that it discloses no reasonable defence or that it may prejudice, embarrass or delay the fair trial of the action or that it is otherwise an abuse of the process of the court.
The defendants submit that the court should only strike out the pleas of justification, or the particulars in support of them, on the ground that they disclose no reasonable defence if the pleas are so obviously untenable that they could not possibly succeed in accordance with the judgment of Barwick CJ in General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125, 130. It is well established that a court whose jurisdiction is properly invoked should not decide the issues raised in those proceedings in a summary way except in the clearest of cases. The test to be applied has been expressed in various ways, but all of the verbal formulae which have been used are intended to describe a high degree of certainty about the ultimate outcome of the proceeding if it were allowed to go to trial in the ordinary way: Agar v Hyde (2000) 201 CLR 552 [57] (Gaudron, McHugh, Gummow & Hayne JJ).
This court has discouraged technical pleading points since the advent of positive case flow management; nevertheless, the exercise of the power to strike out in an appropriate case may advance positive case flow management. The trial of an action should concern itself with the essential issues and the evidence relevant to them; the trial should be kept strictly to the issues necessary for a fair determination of the dispute between the parties.
If the particulars of fact provided are not capable of establishing the truth of the imputations or meanings sought to be justified by the defendants then the defence of justification should be struck out. To do otherwise is to allow to proceed to trial a defence that cannot succeed. The court should prevent a plea of justification which cannot succeed going forward and thus wasting everyone's time and money.
A properly pleaded and particularised defence is vital to the efficiency and expedition of the trial and to ensure fairness as between the parties. Irrelevant particulars may be struck out. Pleaded facts or particulars are not struck out merely because they are unnecessary. However, unnecessary material may be struck out if it will cause delay or embarrassment. Those principles apply to particulars given in support of a plea of justification. In David Hunt v Times Newspapers Ltd [2012] EWHC 110 (QB) Eady J said:
Moreover, each sub-paragraph of particulars of justification should be relevant to and supportive of one or more of the defamatory meanings sought to be justified. Of course, it is right that some material may appear as necessary background, but it must genuinely form part of the narrative for the purpose of achieving that ultimate objective. It is obviously not appropriate to include allegations merely with a view to creating a climate of prejudice [24].
Counsel for the defendants, Mr Dawson, submitted that it is not necessary that the particulars of justification, if proved at trial, be sufficient to justify the relevant imputations. Mr Dawson referred to statements of Nicholas J to that effect in Edward Hayson v John Fairfax Publications Pty Ltd [2007] NSWSC 763 [35] ‑ [51]. An application for leave to appeal was refused in Hayson where Hodgson JA, with whom Tobis and Santow JJA agreed, said:
For my part I would accept that there could be circumstances where particulars fall so short of being capable of supporting the truth of imputations that it could be justified to strike out imputations. However, the particulars do not themselves indicate the outer limits of what may be proved. They indicate, in effect, topics on which evidence may be led. But the full effect of evidence led within the particulars may be greater than what the bare particulars themselves indicate [20].
Hodgson JA was not persuaded at that stage of the proceedings that the particulars fell so far short of being able to permit evidence that could establish the truth of the contextual imputations that they should be struck out.
In Ange v Fairfax Media Publications Pty Ltd [2010] NSWSC 645 the plaintiff sought to strike out a plea of justification on the basis that even if the facts asserted in the particulars were proved the evidence would be insufficient to demonstrate the truth of the imputation. Simpson J said that to succeed the plaintiff must show that, taken at their highest, the matters particularised would not be capable of establishing the relevant imputation. The plaintiff also submitted that the particulars ought to be seen as an attempt to put before the jury evidence to prejudice them against the plaintiff and further that the facts particularised were irrelevant to the imputation sought to be justified. Simpson J said that these submissions
trespass dangerously upon the role of the trial judge in determining the admissibility of evidence. To characterise particulars (which are merely the forerunners of evidence that will be tendered) as irrelevant or an attempt to create prejudice is to raise issues more properly dealt with in the context of admissibility of evidence. By saying this I do not mean to suggest that it will never be appropriate to consider the capacity of a particularised case to establish what it purports to establish.
Her Honour went on to refer to the statement by Hodgson JA in Hayson to which I have referred.
Nicholas J again referred to the adequacy of particulars in Ange v Fairfax Media Publications Pty Ltd [2011] NSWSC 204 where his Honour said:
It is well established that a court should proceed with caution on an application such as this. In this case the application is directed to the pleaded particulars and not to the defence itself. For the plaintiff to succeed it is necessary to establish that the particulars fall so far short of being capable of supporting the truth of the imputations that they should be struck out (Hayson v John Fairfax Publications Pty Ltd [2007] NSWCA 376, per Hodgson JA [20]).
His Honour found that the challenged particulars were irrelevant to the issue of substantial truth in the case and ordered that they be struck out. His Honour said:
In my opinion there is such a wide difference between the facts asserted in the particulars and the imputations as to justify removing from the issues for trial the issues raised in the particulars. To do otherwise would be to give each imputation a meaning much wider than it bears [66].
The statement of Hodgson JA in Hayson was explained by McCallum J in Howes v ACP Magazines Ltd [2013] NSWSC 1836. After referring to the statement of Hodgson JA that particulars do not themselves indicate the outer limits of what may be proved, her Honour said:
The role of particulars of a justification defence is to identify the facts, matters and circumstances that will be relied upon, but a sensible approach is always taken to the evidence which can be given, based on such particulars. In my view, it would be absurd to suggest in the present case that the defendants were confined to leading evidence in the terms of the specific facts identified in par 13. That paragraph identifies an incident and, in my view, the defendants will be entitled to lead, in the normal way, evidence of the whole of the relevant circumstances making out that incident, including matters such as dates, conversations, what different people were wearing and so on, whether or not such matters are specified in par 13 of the defence.
Order 20 r 13(1)(a) provides that every pleading must contain the necessary particulars of any claim. The adequacy of particulars provided must be determined having regard to the purpose of particulars. In Barclay Mowlem Construction Ltd v Dampier Port Authority [2006] WASC 281; (2006) 33 WAR 82 , Martin CJ stated:
[The contemporary purposes of pleadings] include the definition of the issues to be determined in the case and enabling assessment of whether they give rise to an arguable cause of action or defence as the case may be, and apprising the other parties to the proceedings of the case they have to meet [4].
A plaintiff is entitled to sufficient information about a defendant's case to ensure a fair trial and to guard against surprise. The degree of precision with which a case must be particularised will, in part, depend upon the nature of the defendant's case. A defendant must comply with well‑established principles governing the pleading of a defence of justification. Any such plea must be directed at one or more defamatory meanings, which are clearly identified, and must be based on or supported by particulars which are not only clear but also both relevant to, and sufficient to support, each meaning. It is not sufficient that the particulars merely identify some 'topic' about which some evidence might emerge which would justify the imputation. That is akin to Mr Micawber's faith that 'something will turn up'. It is not a sufficient basis for a plea of justification.
I adopt, with respect, the observations of Lord Justice Pill and Mrs Justice Sharp in Foley v Ashcroft [2012] EWCA Civ 423; [2012] EMLR 25 concerning the requirements of relevance and sufficiency of a defence of justification:
So far as the particulars are concerned, the vice of a vague and general meaning is that it is liable to lead to a loose and ineffective pleading with excessive and irrelevant particulars, a state of affairs which is not permissible and which has been deprecated, particularly in libel actions, for many years: see for example, Associated Leisure v Associated Newspapers Ltd [1970] 2 QB 450 and Atkinson v Fitzwalter and ors [1987] 1 All ER 483. Particulars provided in support of a plea of justification must be both sufficient and pleaded with proper particularity. The former requirement is met if the (properly pleaded) particulars are capable of proving the truth of the defamatory meaning sought to be justified. The latter requirement is a factor to be judged not by the number of particulars provided, but by the pleading of a succinct and clear summary of the essential (and relevant) facts relied on, enabling a claimant to know the precise nature of the case against him, and providing him with sufficient detail so he can meet it. As Lord Woolf pointed out in McPhilemy v Times Newspapers Ltd [1999] All ER 775 at 793c, a loose and ineffective pleading can achieve directly the opposite effect from that which is intended by obscuring the issues rather than providing clarification. In our judgment this is what has happened here, and we do not think the problem is curable by a request for further information or by simple pruning.
There are difficulties in managing a case justly to which a loose and ineffective pleading will give rise at each stage of the litigation. These include at the reply stage when a claimant must specifically admit or deny the allegations against him, giving the facts on which he relies: see CPR 52 PD 19 para 2.8, when disclosure takes place, when witness statements are prepared, and at the trial itself which may take place before a jury. Time and money will almost inevitably end up being wasted over matters which have little to do with the overall merits of the litigation [49] ‑ [50].

Plaintiff's imputations 6.1, 11.1, 15.1 and First Alternative Meaning I

The plaintiff pleads in par 6.1, 11.1, 15.1 and 20.1 of the further reamended statement of claim that each of the articles complained of give rise to the imputation:
The plaintiff as the Chairman of each of Queste, Orion and Bentley, preferred his own financial interest to the interests of shareholders of these companies.
The defendants plead the following alternative meaning (First Alternative Meaning I) to the plaintiff's imputations:
The plaintiff preferred his own financial interest to the interest of shareholders of companies of which he was Chairman.
Counsel for the defendants explained that the difference between the plaintiff's imputation and the defendants' alternative meaning is that the defendants' meaning is that the plaintiff preferred his own financial interests to the interest of shareholders of one or two or three of Queste, Orion and Bentley rather than each of them.

Plaintiff says pars 4 ‑ 37, 39 ‑ 41 and 45 ‑ 70 of particulars are irrelevant

As I have said, the facts on which the defendants rely in support of their pleas of justification are set out in 79 consecutively numbered paragraphs which extend over 19 pages. The defendants identify which of those paragraphs are relied upon to justify each group of imputations or meanings. On page 26 of the defence, it is said that all of the matters in pars 1 to 79 are relied on in support of the defendants' plea of justification of the plaintiff's first imputation and the defendants' first alternative meaning. The plaintiff's first imputation and the defendants' first alternative meaning are confined to the meaning that the plaintiff, as the chairman of one or more of Queste, Orion and Bentley, preferred his own financial interest to the interests of shareholders of those companies. However, the particulars extend over a range of matters. Unfortunately, it is necessary to give attention to some of those matters to consider whether they are relevant to the meanings sought to be justified.
The plaintiff's first complaint is about par 4 which is:
At all material times:
(a)The plaintiff and/or entities controlled by/associated with him have held substantial shareholdings in Queste.
(b)Members of the plaintiff's family and/or entities controlled by/associated with the relevant family members have held substantial shareholdings in Queste.
(c)The plaintiff, in conjunction with entities controlled by/associated with him and/or with members of his family and/or entities controlled by/associated with those family members, used the substantial shareholding in Queste, including the associated voting rights, to control:
(i)the activities of Queste;
(ii)the activities of entities associated with and/or controlled by Queste; and
(iii)the appointment of directors to the Board of entities associated with and/or controlled by Queste,
as particularised herein.
The plaintiff says that the allegation that the plaintiff and/or entities controlled by or associated with him have held substantial shareholdings in Queste is a serious allegation but is a statement of conclusion that does not set out the facts upon which it is based. The concept of 'associates' performs important functions in the Corporations Act 2001 (Cth). The prohibitions in s 606 define the 20% threshold by reference to voting power and s 610 defines voting power by taking into account the votes of associates of the person whose voting power is to be assessed. Associates also figure in other provisions in ch 6 and takeover‑related chapters.
The defendant says that par 4 is constrained by the closing words 'as particularised herein'. However, none of the particulars of justification contain any particulars of shares in Queste held by the plaintiff, members of the plaintiff's family, entities controlled by or associated with the plaintiff or members of his family. In my view, the plaintiff is entitled at least to particulars of the allegations in par 4 including the identification of the entities controlled by or associated with him which have held substantial shareholdings in Queste, the identification of the members of the plaintiff's family and/or entities controlled by or associated with the relevant family members who have held substantial shareholdings in Queste, and the substantial shareholdings referred to. The defendants should provide those particulars. If the plaintiff is not satisfied with the particulars then he may renew his application to strike out par 4 of the particulars of justification or a similar plea in any amended particulars.
The defendants say that pars 4 ‑ 33 of the particulars of justification are relevant in that they concern the plaintiff's appointment and responsibilities as chairman of Queste, Orion and Bentley for which he received a high salary, as well as his increasing control of those companies over time which the defendants say is the plaintiff's own financial interest. The defendants say that pars 34 ‑ 42, 45 ‑ 61, 71 ‑ 73 and 75 ‑ 78 of the particulars of justification are relevant in that they concern the activities and under performance of Queste, Orion and Bentley during the relevant period, a matter going to the return or value shareholders received for their investments which the defendants say is the interests of the shareholders. The defendants say that par 43 ‑ 44, 74 and 79 of the particulars of justification are relevant to the remuneration that the plaintiff received as chairman of Queste, Orion and Bentley which is the plaintiff's own financial interest. I am not persuaded that those paragraphs of justification are so clearly not relevant to the relevant imputations that they should be struck out.
Paragraphs 35 to 37 of the particulars are to the effect that the Queste website described Queste as a supplier of VoIP telephony software solutions and services which was a false representation and that the plaintiff had overall responsibility for ensuring that the website accurately stated the nature of Queste's activities. Those matters are irrelevant to the plea that the imputation that the plaintiff preferred his own financial interests to those of the shareholders is true.
The defendant does not press pars 62 ‑ 70 in relation to the imputations being considered. Those paragraphs relate to the Mandurah property rental arrangement. Those paragraphs are not relevant to the imputations being considered. The existing particulars should be struck out and new particulars should be given which, in relation to the defendants' plea that the plaintiff's first imputation and the defendants' first alternative meaning are true does not rely upon the matters set out in pars 35 ‑ 37 and 62 ‑ 70 of the existing particulars.

Plaintiff says particulars fail to establish an arguable case that the plaintiff preferred his own financial interests

The defendants' case in relation to the imputations being considered is that during the relevant period the shareholders of Queste, Orion and Bentley received little or no return on their investments while the plaintiff received a high salary as chairman of those companies. The plaintiff's salary was high in the sense that the amount he received remained about the same or actually increased during the relevant period (with the exception of Queste in the 2013 financial year) and that such a high salary was excessive in circumstances where the companies were under‑performing and shareholders were receiving little or no return on their investments.
The defendants say that their foreshadowed case reflects the basis on which their capacity objection was resolved in the plaintiff's favour in Khan No 1 at [28] and it therefore reflects the context and manner in which the first matter complained of conveys the notion of the plaintiff preferring his own financial interests.
In Khan No 1 the defendants argued that the imputation that the plaintiff as director and chairman of each of Queste, Orion and Bentley preferred his own financial interest to the interests of shareholders of these companies is not capable of arising from the complained of publications. The defendants argued that the mere fact that an executive chairman is paid well while the company does not perform very well over a period cannot, without more, suggest some form of misconduct on the part of the executive chairman. I held that the imputation was not so unarguable that it should be struck out:
In my opinion imputations 6.2 and 11.2 are not so unarguable that they should be struck out. Executive remuneration has become a widespread topic of conversation in Australia. Since the global financial crisis there has been increasing scrutiny of executive remuneration. In everyday conversations and in public utterances disquiet, even outrage, at high executive remuneration is expressed from time to time. It is true that the mere fact that an executive chairman is paid well while the company does not perform well over a period cannot, without more, suggest some form of misconduct on the part of the executive chairman. However, the something more may be the structure and tone of the article. Many articles are devised on the 'no smoke without fire' premise, so that many allegations take a form which might be construed as alleging improper behaviour though on detailed analysis the allegation is not directly made. In Lewis v Daily Telegraph [1964] AC 234, 285 Lord Devlin said:
'It is not, therefore, correct to say as a matter of law that a statement of suspicion imputes guilt. It can be said as a matter of practice that it very often does so, because although suspicion of guilt is something different from proof of guilt, it is the broad impression conveyed by the libel that has to be considered and not the meaning of each word under analysis. A man who wants to talk at large about smoke may have to pick his words very carefully if he wants to exclude the suggestion that there is also a fire; but it can be done. One always gets back to the fundamental question: what is the meaning that the words convey to the ordinary man: you cannot make a rule about that. They can convey a meaning of suspicion short of guilt; but loose talk about suspicion can very easily convey the impression that it is a suspicion that is well founded.'
The articles are written in the context of a widespread perception that executive remuneration should reflect corporate performance. The articles themselves link the plaintiff, the companies' poor performance and the plaintiff's high salaries by juxtaposing the companies' poor performance with the plaintiff's high salaries. The article is generally derogatory of the plaintiff. It is not unarguable that the articles give rise to the meaning that the plaintiff preferred his own interests to those of the shareholders [27] ‑ [28].
As the above passage from my reasons shows, I expressly agreed with the defendants' submission that the mere fact that an executive chairman is paid well while the company does not perform well over a period cannot, without more, suggest some form of misconduct on the part of the executive chairman. The 'something more' which the defendants rely upon to support their plea of justification is that the amount the plaintiff received remained about the same or actually increased during the period in which the companies were underperforming and the shareholders were receiving little or no return on their investments. The particulars also include matters relating to the activities or level of operations of the companies - see, for example, pars 5, 9, 10, 11, 12, 14, 20, 21, 23, 27, 28, 29, 31, 32, 33, 34, 45, 46, 51, 52, 53, 56, 57, 58, 59, 75. Those matters are arguably capable of proving that the plaintiff's remuneration as chairman of the companies was excessive and unreasonable. However, the particulars do not allege facts from which it may be inferred that the plaintiff was directly or indirectly knowingly concerned in or party to fixing his remuneration or that he procured others to do so. In the absence of particulars to that effect the existing particulars are not arguably capable of justifying the imputation that the plaintiff preferred his own financial interests to the interests of the shareholders.

Plaintiff's imputations 6.3, 11.3 and First Alternative Meaning II

The plaintiff pleads in pars 6.3 and 11.3 of the further reamended statement of claim that the First Article and the First Website Article give rise to the imputation:
The plaintiff as the Chairman of each of Queste, Orion and Bentley is the most incompetent executive chairman of any company whose securities were listed for quotation on the ASX at the time of the article.
The defendants plead the following alternative meaning (First Alternative Meaning II) to the plaintiff's imputation:
The plaintiff is incompetent in that two investment companies of which he is the Chairman were the worst performing listed investment companies on the ASX at the time of publication of the First Article and the First Website Article.

Plaintiff says particulars of justification do not justify plaintiff's imputation

In my opinion, the defendants' particulars of justification are not arguably capable of justifying the plaintiff's imputation for two reasons. First, the particulars state no facts which establish, or from which it might be inferred, that Queste is the worst performing, or one of the worst performing, companies on the ASX at the time of the article. The particulars include particulars that Orion was the worst performing listed investment company on the ASX and Bentley the second worst performing listed investment company on the ASX at the time the articles were published but there is no similar particular in relation to Queste. Secondly, the particulars in relation to Orion and Bentley are that they were the worst performing, and second worst performing, listed investment companies on the ASX, not of any company whose securities had been listed for quotation on the ASX at the time of the article.
The plaintiff's second objection is that the particulars do not justify the defendants' alternative meaning. The plaintiff says that the particulars fail to establish a link between the performance of Queste, Orion and Bentley and the incompetence of the plaintiff, as opposed to other people who may have been involved in the operation and management of those companies. The defendants submit that those are matters for evidence at trial and that the particulars are sufficient to allow the leading of evidence which may establish the link. Furthermore, the defendants have set out at pars 3, 7, 18, 19, 20(b) and 26 the nature of the responsibilities particular to the plaintiff as chairman of the companies. I am not satisfied that it is unarguable that the evidence which may be led pursuant to the particulars is incapable of establishing a link between the performance of Queste, Orion and Bentley and the incompetence of the plaintiff.
The plaintiff further says that the relevant particulars do not justify the defendants' alternative meaning because they do not establish that Orion and Bentley were the two worst performing listed investment companies on the ASX. Paragraph 73 of the particulars is that as at 30 September 2013 according to the latest ASX Funds Monthly Update (August 2013), Orion traded at a discount of minus 59.39% to its net tangible assets, making it the worst performing listed investment company on the ASX at the time that the First Article and First Website Article were published. Paragraph 78 is in similar terms in relation to Bentley, except that Bentley traded at a discount of minus 39.39% to its net tangible assets, making it the second worst performing listed investment company on the ASX at the time that the articles were published.
The plaintiff says that the relativity of a company's trading price (and therefore market capitalisation) to its net tangible assets (and thereby its potential breakup value) is not a measure of the performance of the company at all. The plaintiff says that measures of performance would include the company's profitability or otherwise which is the generally accepted method of analysing financial performance of companies and also returns to shareholders through a combination of dividends, capital return and share price appreciation or depreciation. In my view, this is a matter for evidence and argument at trial. The defendants' case is not so clearly unarguable that it should be struck out.

Plaintiff's imputations 6.4, 11.4, 15.2 and 20.2

The plaintiff pleads in pars 6.4, 11.4, 15.2 and 20.2 of the further reamended statement of claim that each of the articles complained of give rise to the imputation:
The plaintiff as the Chairman of Orion, failed to disclose to shareholders that he occupied the Mandurah property owned by Orion prior to 1 June 2013 in circumstances where such disclosure was necessary.
The plaintiff says that the particulars in support of the plea that the imputation is true are vague, ambiguous and contain irrelevant material and are not capable of justifying the imputation.
The defendants say that their case is a circumstantial case. It is to be inferred from the matters particularised that the plaintiff occupied the Mandurah property prior to 1 June 2013. In particular, the inference arises from the facts that the plaintiff and/or his family's belongings were located at the property prior to 1 June 2013 and rental income was paid in the 2012 financial year prior to the plaintiff disclosing that he was renting the property in the 2013 and 2014 financial years. In my view, the defendants' case is not so unarguable that it should be struck out. The particulars are not so vague or ambiguous as to be embarrassing. The particulars are adequate to define the issues and inform the plaintiff of the case he has to meet.

Plaintiff's imputations 6.5 and 11.5

The plaintiff pleads in pars 6.5 and 11.5 that the First Article and the First Website Article give rise to the imputation:
The plaintiff uses his position at Queste so as to secure personal benefits in being appointed the remunerated Chairman of other companies.
The plaintiff says that the plea in par 4 of the particulars to which I have already referred alleges an association between the plaintiff and others which is not sufficiently particularised. As I have said earlier in these reasons, the defendants should provide further particulars of the allegation in par 4 of the particulars and if the plaintiff is not satisfied with the particulars given he may renew his application to strike out par 4 of the particulars of justification or a similar plea in any amended particulars.
The plaintiff further says that the defendants' particulars do not make clear how the plaintiff uses his position at Queste to secure personal benefits in being appointed the remunerated chairman of 'other companies'.
The defendants submit that the particulars make clear that the plaintiff used his position at Queste, either on his own or in association with members of his family, to secure his appointment as chairman of other companies. The personal benefits secured by the plaintiff were his appointment as Chairman of other companies and the remuneration he consequently obtained. I am not satisfied that the defendants' case is so unarguable that it should be struck out.

Plaintiff's imputations 6.6 and 11.6

The plaintiff pleads in pars 6.6 and 11.6 of the further reamended statement of claim that the First Article and the First Website Article give rise to the imputation:
The plaintiff as the Chairman of Queste causes the company to make false claims on its website regarding the nature of its business.
The plaintiff says that there is a significant disconnect between the defendants' particulars and establishing the truth of the material part of the imputation, namely that the plaintiff caused the company to make false claims. The plaintiff says that the defendants are attempting to justify a different imputation, namely that the plaintiff is responsible for the company making false claims on its website.

The defendants' argument is as follows. The plaintiff had overall responsibility for the day‑to‑day management of Queste, including ensuring that Queste's website accurately reflected the company's activities. The plaintiff's failure to do so suffices as the 'causative element' of the imputation. One of the consequences of the imprecision of the word 'causes' in the imputation is that it may be proved true in a variety of ways, including as alleged in the defence. The fact that the same particulars might support the alternative but equally imprecise allegation of 'responsibility for' the same state of affairs is no basis for striking out the defence to these imputations.
The plaintiff's imputation does not specify the precise way in which it is said the plaintiff caused the company to make false claims on its website regarding the nature of its business. The word 'causes' has a range of meanings. In Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158, 163 Hunt CJ at CL said that 'caused' is what has become known as a 'weasel' word, in that, such is its convenient ambiguity, no one will ever know the way in which it has been used or understood.
The pleaded imputation must be considered in the context of the matter complained of: Greek Herald Pty Ltd v Nikolopoulos (2001) 54 NSWLR 165, [27]. The articles complained of say that according to Queste's website the company specialises in voice‑over‑internet protocol technology (VoIP) but it does not, Queste is simply a holding company. Counsel for the defendants says that in that context the imputation may be justified by establishing that the website claim was wrong and in his capacity as executive chairman and managing director of Queste the plaintiff bore responsibility for the continued publication of those false claims. I am not satisfied that the defendants' case is so unarguable that it should be struck out.

Conclusion

I have found that some of the particulars of justification are irrelevant to the imputations which they are alleged to justify. Further, the form of the particulars should be amended so that they are divided into paragraphs numbered consecutively, each allegation being, so far as convenient, contained in a separate paragraph. In the circumstances, it is appropriate to strike out the whole of the particulars so that they may be repleaded in a more convenient form. If the defendants include in the amended particulars allegations in the same or similar terms to par 4 of the existing particulars then the defendants should give the further particulars of those allegations that I have set out earlier in these reasons. Paragraphs 26, 27 and 28 of the defence should be struck out because the particulars of justification are to be struck out and for the reasons set out earlier in these reasons.