Maatouk v Katrib

[2022] NSWDC 463

District Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Maatouk v Katrib [2022] NSWDC 463

Hearing dates:

6 October 2022

Date of orders:

11 October 2022

Decision date:

11 October 2022

Jurisdiction:

Civil

Before:

Gibson DCJ

Decision:

(1)   Judgment and other orders entered on 7 July 2022 set aside.

(2)   Costs of this application reserved.

(3)   The parties are to bring in Short Minutes of Order reflecting a timetable for the future conduct of these proceedings.

Catchwords:

PRACTICE AND PROCEDURE - defendant fails to communicate with her pro bono lawyers, who do not file an amended defence conformably with a timetable - prior history of unsatisfactory pleading by both the plaintiff’s lawyers and the defendant’s previous lawyers - history of delay on both sides - whether entry of default judgment warranted - whether a defence on the merits was made out - no issue of principle

Legislation Cited:

Defamation Act 2005 (NSW), ss 12A,12B, 46

Uniform Civil Procedure Rules 2005 (NSW), r 36.16(2)

Cases Cited:

Altarama Ltd v Forsyth [1981] 1 NSWLR 188

Bazzi v Dutton [2022] FCAFC 84

Bindel v PinkNews Media Group Ltd and another [2021] EWHC 1868 (QB)

Cumberland v Clark (1996) 39 NSWLR 514

Flanagan v Urban Publishing Group Pty Ltd [2012] NSWDC 238

French v Triple M Melbourne Pty Ltd [2006] VSC 36

Graham v Powell(No 3) [2014] NSWSC 185

Hanrahan v Ainsworth (1985) 1 NSWLR 370

Massarani v Kriz [2022] FCA 80

The Commonwealth of Australia v Verwayen (1990) 170 CLR 394

Woods v Baxter [2021] NSWDC 265

Texts Cited:

District Court Practice Note (Civil) No. 6

Category:

Procedural rulings

Parties:

Plaintiff: Mr Peter Maatouk
Defendant: Ms Rima Katrib

Representation:

Counsel:
Plaintiff: Mr T Senior
Defendant: Mr R Potter SC

Solicitors:
Plaintiff: Madison Marcus
Defendant: RGS Law (Pro Bono)

File Number(s):

2021/00329668

Publication restriction:

Nil

Judgment

The applications before the court

1. There are two applications before the court:

1. The defendant brings an application to set aside a default judgment entered on 7 July 2022.

2. The plaintiff resists the application and seeks orders permitting the assessment of damages to proceed.

2. The plaintiff relies upon two affidavits:

1. The affidavit of Mr Johnathon de la Hoyde sworn on 9 September 2022.

2. A second, confidential affidavit of Mr de la Hoyde, sworn on the same date.

3. The defendant relies upon three affidavits:

1. The defendant’s affidavit sworn on 22 August 2022.

2. The affidavits of Ms Sophie Lumsden sworn on 22 August and 4 October 2022.

The circumstances leading to the matter complained of

4. The plaintiff and defendant, who were formerly husband and wife, separated in February 2020 and were subsequently divorced. Between March and November 2020, the defendant made a series of allegedly defamatory posts on social media and sent an email in similar terms to the plaintiff’s office staff. A concerns notice was sent on 31 March 2021, followed by a series of emails up to 6 July 2021.

5. The defendant published four further publications in July 2021 and a further concerns notice was sent on 22 July 2021. There were no further publications after that time.

The procedural history of the claim

6. The plaintiff commenced proceedings for defamation for six publications made between 6 February and 22 July 2021 on 19 November 2021. There were difficulties in effecting personal service between that date and 3 February 2022, when the court made an order for substituted service.

7. It is not in dispute that, contrary to ss 12A and 12B of the Defamation Act 2005 (NSW) (“the Act”), the plaintiff’s concerns notice failed to set out the imputations for any of the matters complained of separately for each publication and failed to provide particulars of serious harm for the first four matters complained of, all of which were published after 1 July 2021, when a requirement to plead serious harm particulars came into effect for publications in New South Wales. The transitional provisions (s 46 of the Act) are agreed by both Counsel not to apply to these four publications as they are very different in subject matter to the publications made prior to that date.

8. On 3 March 2022, orders were made for the defendant to file a defence by 15 March 2022. On that date the solicitors for the plaintiff received not only a defence but also a request for further and better particulars from Bartier Perry Lawyers, who advised that they were acting for the defendant.

9. Unfortunately, the defence filed on 15 March 2022 was even more inadequate than the statement of claim. Not only did the pleader fail to pick up the errors in the concerns notice and statement of claim concerning serious harm, but he/she also erroneously pleaded defences under the new legislative amendments to publications made before the date that these came into effect. There were additionally inadequately pleaded defences of justification and a form of rolled-up plea of contextual truth to all publications.

10. The plaintiff’s solicitors advised the defendant’s solicitors that the defence was hopeless and should be amended. The defendant’s solicitors refused to amend and the plaintiff’s solicitors advised that they would bring an application to strike out the defence. That application was listed for argument on 28 April 2022.

11. On 19 April 2022 the solicitors for the defendant sent a letter acknowledging that the defence should be struck out and agreed to orders to this effect. They sent another request for particulars but then ceased acting for the defendant on 9 May 2022.

12. Both parties had to amend their pleadings. The solicitors for the plaintiff wrote to Mr Potter SC (who was acting for the defendant on a direct brief basis at this time) setting out that they proposed to amend the statement of claim to include particulars of serious harm for four publications made after 1 July 2021 and to plead the four rolled-up publications separately. This was consented to after a draft statement of claim was served. By consent, with the leave of the court granted on 12 May 2022, the plaintiff filed an amended statement of claim on 25 May 2022 enlarging the publications to ten in number and providing particulars of serious harm.

13. The defendant, however, was not so lucky. The timetable provided for her to file a defence (or alternatively submissions in support of any application to strike it out) to the amended statement of claim by 23 June 2022. No such documentation was filed. Her explanation is that she lost her mobile phone over this period.

14. It was in these circumstances that the matter came before Levy SC DCJ on 7 July 2022. The plaintiff’s default was a failure to file a defence to the amended statement of claim by the due date, namely 23 June 2022. In other words, the plaintiff was two weeks behind in the timetable.

15. The transcript of what occurred on 7 July 2022 is available. It was a busy List and a lengthy affidavit had only come to his Honour's attention after the List started, where the annexures had not been printed off by the registry, and which he had not had time to look at. The barrister standing in for Mr Potter SC (who was away overseas) told the court he had not been able to get instructions about the defence and sought leave to withdraw.

16. Levy SC DCJ noted the number of times the matter had been in the Defamation List and that the defendant had not been in touch recently with her legal advisers. His Honour considered this was sufficient grounds to strike out the defence and list the matter for hearing as an assessment of damages on 25 August 2022.

17. By way of general summary, merely setting out these dates illustrates the unfairness to the defendant of entering judgment in response to a two-week delay. What is more, this two-week delay followed the granting of an indulgence to the plaintiff by allowing him to replead his case to enlarge the number of causes of action from six to ten and to correct a serious pleading error by omitting serious harm.

18. However, in order to persuade the court to set aside these orders, the defendant still has to establish that there is a viable defence as well as answer any claims of prejudice.

The draft defence

19. The defendant seeks orders setting aside the default judgment so that she can be let in to defend. A general summary of the pleadings in the draft defence is as follows:

1. As to the four publications which were made after the amendments to the Act came into force on 1 July 2021, the defendant submits that the failure to serve a valid concerns notice means that these matters should be struck out.

2. There is a properly pleaded defence of justification to one publication and of triviality to two publications.

3. There are challenges to identification in two publications.

4. Although not currently pleaded, there are limitation arguments in relation to four of the publications.

The relevant principles of law

20. The power to set aside a judgment obtained in the absence of a party is set out in Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”) r 36.16(2) as follows:

“36.16 Further power to set aside or vary judgment or order

…

(2) The court may set aside or vary a judgment or order after it has been entered if—

(a) it is a default judgment (other than a default judgment given in open court), or

(b) it has been given or made in the absence of a party, whether or not the absent party had notice of the relevant hearing or of the application for the judgment or order, or

(c) in the case of proceedings for possession of land, it has been given or made in the absence of a person whom the court has ordered to be added as a defendant, whether or not the absent person had notice of the relevant hearing or of the application for the judgment or order.

…”

21. Although this rule refers to a notice of motion being required, that is not necessary in defamation proceedings by reason of District Court Practice Note (Civil) No. 6 at paragraph 14 (directions were given for the hearing of this argument on that basis).

22. In general terms, applications to set aside judgments require consideration of the following:

1. Whether the defendant has provided an adequate explanation for failing to prevent judgment being entered and any delay in seeking to set it aside.

2. Whether a defence can be made out.

3. Whether there is any prejudice to the plaintiff if the judgment is set aside.

23. I will deal briefly with the second and third of these requirements. As to the second, with one exception (namely an assertion that the defendant has waived her rights to challenge the concerns notices and failure to plead serious harm, a submission that I consider should be reserved for further argument after the defence has been filed), the plaintiff does not challenge the strength of the defences to the ten publications as pleaded. As to the third of these, there was no delay in bringing this application and there is no submission of prejudice to the plaintiff if the judgment is set aside beyond the presumptive prejudice of losing the opportunity to have a final hearing sooner rather than later.

24. As to the first, I have read the affidavit of the defendant and I find her story of losing her mobile phone implausible. I am, however, satisfied that the defendant did, and was entitled to, rely on her legal representatives to take such steps as were necessary in this litigation to protect her interests. In that regard, she was in a difficult situation. Her solicitors had filed a hopeless defence and then ceased to act, leaving the responsibility of assisting her to her pro bono counsel. Her replacement counsel did what he could in a situation where he could not contact her. It was not to be expected by her that a two week delay would lead to default judgment and a hearing date for assessment of damages for the following month.

25. It is hard to imagine a clearer case for the setting aside of judgment. The cumulative effect of hopeless pleadings and delays on both sides means, in my view, that the plaintiff is not entitled to throw the first stone.

26. While I am conscious that a very large courtbook and extensive written submissions have been provided by counsel on both sides (neither of whom are in any way to blame for the current problems), I see no point in any further analysis of the circumstances leading to the making of an order that I consider should not have been made.

27. I am indebted to both counsel for a most interesting discussion of the principles of waiver as set out in The Commonwealth of Australia v Verwayen (1990) 170 CLR 394, but this is an argument which can await the hearing of any challenge to the defence, not least because the serious harm issue, including whether there should be a preliminary hearing on serious harm (a startling prospect, if it only applies to four of the ten publications) is tied up with waiver arguments, and this was a topic that was not touched upon.

Default judgment in defamation proceedings

28. Although I am satisfied that, on the general principles applicable to the setting aside of default judgments, judgment for the plaintiff should be set aside, I make some additional observations about the special factors of defamation litigation which have long rendered it unsuitable for default judgment other than in very clear cases. These issues were not raised by the parties and do not form part of my reasoning, but they are based on case management rules of very long standing, which are perhaps even more apposite today than they were in the past.

29. For decades, default judgment was not available at all in defamation actions, for the reasons set out in Altarama Ltd v Forsyth [1981] 1 NSWLR 188. As Hunt J explains (at 191), the nature of the cause of action was not generally amenable to default judgment without a consideration of the imputations. This is because the Defamation List operates outside the usual court rules for status conferences, defences in 28 days and the like. There were also potential abuse of process issues. As a result, the safest way for the court to enter default judgment was on case management principles, namely where there had been a peremptory order with which the defendant was in default:

"Particularly in defamation litigation, a plaintiff can rarely if ever hold a judgment by default where the issue of defamation itself remains for the jury to determine. … Far more satisfactory for all concerned is a peremptory order which, if not complied with, puts an end to the whole matter. In my opinion, it is quite inappropriate to have resort to the right to enter judgment by default once directions have been given in the matter; if judgment by default is warranted in any particular case, application should be made for such judgment to be directed in accordance with Pt 17, r 9."

30. Similarly, in Graham v Powell (No 3) [2014] NSWSC 185 at [6], Beech-Jones J warned of the "risk of oppression" in entering default judgment against a litigant in person unfamiliar with the complexities of defamation law.

31. This should not be a rule to be dispensed with as a part of past practice. Thanks to the increasing number of ordinary members of the community who has been sued for a publication on social media, it is all the more pertinent. It is well-recognised that the cost of defending a defamation action in Australia (unlike England and other jurisdictions which have costs budgeting in their case management) is eye-watering, with the result that crowdfunding hundreds of thousands of dollars is necessary, even for the winner, as Bazzi v Dutton [2022] FCAFC 84 at [51] demonstrates.

32. Another reason for courts to go the extra mile to assist litigants, even when they are represented, can be seen in the judgments in Bazzi v Dutton and Massarani v Kriz [2022] FCA 80. Both demonstrate the toll of defamation litigation on health and wellbeing, for all concerned. Judges in the past who commented on the strain of litigation very often did so in cases involving very limited publication and defendants with limited resources: Hanrahan v Ainsworth (1985) 1 NSWLR 370 at 377 - 378 per Hunt J (police officer sued for statement made to a lawyer in the United States); Cumberland v Clark (1996) 39 NSWLR 514 at 529 per Levine J (witness sued for police statement in assault proceedings). The litigation in these proceedings has apparently been similarly stressful for all concerned.

33. The views expressed by Beech-Jones J and Hunt J have been followed in this court (see, for example, Flanagan v Urban Publishing Group Pty Ltd [2012] NSWDC 238; Woods v Baxter [2021] NSWDC 265). This has also been the case in other jurisdictions such as Victoria (French v Triple M Melbourne Pty Ltd [2006] VSC 36).

34. There is an additional reason for caution. While it may be possible for default judgment to be entered where there has been no ruling on imputations, s 10A(4) refers to the judicial officer’s “own motion” in relation to the determination of serious harm. While this was clearly aimed at situations such as Bindel v PinkNews Media Group Ltd and another [2021] EWHC 1868 (QB) (where the parties both wanted a serious harm determination but the judge refused to order one), it may be that, since serious harm is a prerequisite to the cause of action, the issue of serious harm could require a ruling by a judge even where judgment is to be entered summarily, before an assessment of damages can take place. That, however, is not an issue which is raised (as yet) in these proceedings.

Costs and other issues

35. I have reserved the issue of costs.

36. There is a defect in the form of the orders entered on JusticeLink on 7 July 2022, with the result that default judgment was not properly ordered and entered. This means that it is necessary to set aside the “orders” in a general sense, but I have included “judgment” as being one of those orders.

Order:

1. Judgment and other orders entered on 7 July 2022 set aside.

2. Costs of this application reserved.

3. The parties are to bring in Short Minutes of Order reflecting a timetable for the future conduct of these proceedings.

**********

Amendments

01 August 2023 - catchwords and representation correction - typographical errors in paragraphs [2], [3], [12], [15] - delete attachments in paragraph [5]

Decision last updated: 01 August 2023