National Roads and Motorists' Association v Whitlam - [2007] NSWCA 81

NEW SOUTH WALES COURT OF APPEAL

CITATION: NATIONAL ROADS AND MOTORISTS' ASSOCIATION v WHITLAM [2007] NSWCA 81
This decision has been amended. Please see the end of the judgment for a list of the amendments.

FILE NUMBER(S):
40594/06

HEARING DATE(S): 28 February & 1 March 2007

JUDGMENT DATE: 11 April 2007

PARTIES:
National Roads & Motorists' Association Limited - Appellant
Nicholas Richard Whitlam - Respondent

JUDGMENT OF: Beazley JA Campbell JA Handley AJA

LOWER COURT JURISDICTION: Supreme Court

LOWER COURT FILE NUMBER(S): 50185/04

LOWER COURT JUDICIAL OFFICER: Bergin J

LOWER COURT DATE OF DECISION: 3/8/06 & 1/9/06

LOWER COURT MEDIUM NEUTRAL CITATION:
Whitlam v National Roads and Motorists' Association Limited [2006] NSWSC 766; Whitlam v National Roads and Motorists' Association Limited [2006] NSWSC 872

COUNSEL:
R M Smith SC; V F Kerr - Appellant
J T Gleeson SC; N J Owens - Respondent

SOLICITORS:
Corrs Chambers Westgarth - Appellant
Phillips Fox - Respondent

CATCHWORDS:
GUARANTEE AND INDEMNITY — indemnity — deed of indemnity — indemnity by company of officer — indemnity of all liabilities incurred by the officer as an officer — officer gives media interview as part of his duties — publication of extracts from interview in context allegedly defamatory of the officer — where officer undertook defamation proceedings against publisher — construction of indemnity — whether officer indemnified for loss of reputation — whether officer indemnified for costs incurred in pursuing defamation proceedings
GUARANTEE AND INDEMNITY — indemnity — indemnity under general law — nature of indemnity by company of officer under general law — where officer undertook defamation proceedings against third party — whether officer acting in performance of office
CONTRACTS — general contractual principles — construction and interpretation of contracts — contract of indemnity — indemnity to be construed strictissimi juris in favour of the indemnifier where indemnity ambiguous
CORPORATIONS — officer of corporation — legislative limits on corporation granting officer indemnity — Corporations Law ss 241, 199A; Corporations Act 2001 (Cth) s 199A
EVIDENCE — confidentiality — admission of confidential deed of settlement — confidentiality orders restricting use of contents of confidential deed of settlement
PRACTICE — confidential evidence — whether court should be closed — confidentiality orders restricting use of contents of confidential evidence

LEGISLATION CITED:
Corporations Act 2001 (Cth)
Corporations Law
Evidence Act 1995
Suitors Fund Act 1951
Supreme Court Act 1970
Trade Practices Act 1974 (Cth)

CASES CITED:
Andar Transport Pty Ltd v Brambles Ltd (2004) 217 CLR 424
Antaios Compania Naviera S A v Salen Rederierna A B [1985] AC 191
Ayoub v Euphoric Pty Ltd (2004) 12 BPR 22,735
BP Refinery (Westernport) Pty Ltd v Hastings Shire Council (1977) 180 CLR 266
Brabazon v Western Mail Ltd (1985) 8 FCR 122
Brambles Holdings Ltd v Bathurst City Council (2001) 53 NSWLR 153
Byrne v Australian Airlines Ltd (1995) 185 CLR 410
Carter v Northmore Hale Davy & Leake (1995) 183 CLR 121
Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337
Cohen & Co v Ockerby & Co Ltd (1917) 24 CLR 288
Colliers Jardine Pty Ltd v Castle Mall Properties Pte Ltd [2005] NSWCA 311
Commissioner of Australian Federal Police v Propend Finance Pty Limited (1997) 188 CLR 501
The Council of the Upper Hunter County District v Australian Chilling and Freezing Co Ltd (1968) 118 CLR 429
The Crown v Henrickson & Knutson (1911) 13 CLR 473
F & D Normoyle Pty Ltd v Transfield Pty Ltd t/as Transfield Bouygues Joint Venture & Anor (2005) 63 NSWLR 502
Famatina Development Corporation Ltd [1914] 2 Ch 271
Frauenfelder v Reid (1963) 109 CLR 42
Great Western Railway v Fisher [1905] 1 Ch 316
Hart v MacDonald (1910) 10 CLR 417
Hide & Skin Trading Pty Ltd v Oceanic Meat Traders Ltd (1990) 20 NSWLR 310
Howard v Lovegrove (1870) 6 LR Ex 43
Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896
John Fairfax & Sons Limited v Police Tribunal of NSW (1986) 5 NSWLR 465
Lend Lease Real Estate Investments Ltd & Anor v GPT RE Ltd [2006] NSWCA 207
Liverpool City Council v Irwin [1977] AC 239
Malik v Bank of Credit and Commerce International SA (in Compulsory Liquidation) [1998] AC 20
National Employers’ Mutual General Association Ltd v Waind & Hill (1978) 1 NSWLR 372
NSW v Tempo Services Ltd [2004] NSWCA 4
Royal Botanic Gardens and Domain Trust v South Sydney City Council (2002) 76 ALJR 436
Schenker & Co (Aust) Pty Ltd v Maplas Equipment and Services Pty Ltd [1990] VR 834
Scott v Scott [1913] AC 417
Sheffield Corporation v Barclay [1905] AC 392
Talbot v NRMA Limited (2000) 50 NSWLR 300
Urquhart v Lanham [2003] NSWSC 109
Waterford v The Commonwealth (1987) 163 CLR 54
Whitlam v National Roads and Motorists’ Association Limited (2006) 202 FLR 153; (2006) 58 ACSR 370; (2006) 24 ACLC 1094; [2006] NSWSC 766

DECISION:
(1) Appeal allowed. (2) Set aside the declarations and orders made on 1 September 2006 in proceedings 50185 of 2004 in the Equity Division, Commercial List of the Supreme Court. (3) Order that proceedings 50185 of 2004 in the Equity Division, Commercial List of the Supreme Court be dismissed. (4) Respondent to pay the costs of the appeal and of the hearing in the court below. (5) Respondent to have a certificate under the Suitors Fund Act 1951. (6) Cross appeal dismissed.
Confidentiality Orders
(1) Redacted version of Deed of Release to be filed. (2) Redacted version of Deed of Release to become exhibit in the appeal. (3) Orders made on 28 February 2007 (judgment para 112) varied.

JUDGMENT:

IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40594/06
SC 50185/04
BEAZLEY JA
CAMPBELL JA
HANDLEY AJA
11 April 2007

NATIONAL ROADS AND MOTORISTS’ ASSOCIATION v NICHOLAS RICHARD WHITLAM

Judgment

BEAZLEY JA: I agree with Campbell JA.
CAMPBELL JA: The respondent, Mr Nicholas Whitlam, was formerly the President of the appellant, NRMA. In the course of his duties as President, Mr Whitlam participated in a recorded television interview with Mr John Lyons, a journalist from Channel Nine. Mr Whitlam agreed to participate in the interview after consultation with various senior officers of NRMA and the media adviser to NRMA, and receiving their tacit approval to his doing so. The media adviser of NRMA was present while the interview was being recorded. The subject matter of the interview related to his activities as President.
The recording of the interview was not transmitted in its entirety. Rather, it was edited, and Mr Whitlam’s words were interspersed among statements and comments by other people. Mr Whitlam took the view that the programme that went to air changed the meaning of what he had said, and was defamatory of him. Several later programmes broadcast by Channel Nine repeated some of the allegations that Mr Whitlam regarded as defamatory. Mr Lyons was interviewed on air, on radio station 2GB, and repeated there some of the matters that Mr Whitlam alleged were defamatory.
Mr Whitlam sued both 2GB and Channel Nine for defamation. Those defamation actions have now concluded.

In the present proceedings, Mr Whitlam sought indemnity from NRMA for his legal costs in bringing the defamation actions against 2GB and Channel Nine. He claimed that indemnity on the basis of one or other of two deeds entered into between himself and NRMA, or alternatively on the basis of the general law. The learned trial judge held he was entitled to that indemnity: Whitlam v National Roads and Motorists’ Association Limited (2006) 202 FLR 153; (2006) 58 ACSR 370; (2006) 24 ACLC 1094; [2006] NSWSC 766.
Costs of the Proceedings
The 2GB proceedings settled after a jury had found that various of the imputations pleaded by Mr Whitlam were defamatory. Under the terms of settlement Mr Whitlam received a public apology in agreed terms, and a sum of money that was stated, in the settlement deed, to be a payment towards his legal costs. In fact that payment was $668.65 less than the actual amount of legal costs that he spent in connection with those proceedings.
Mr Whitlam brought two different sets of proceedings in the New South Wales District Court against Channel Nine. The first set of proceedings against Channel Nine, while commenced, was never served, and was discontinued after some settlement overtures by Mr Whitlam to Channel Nine produced no response. Later, Mr Whitlam began fresh defamation proceedings against Channel Nine, which have now settled. Before either of these sets of proceedings was begun, Mr Whitlam’s lawyers took some preparatory steps, not involving actual commencement of proceedings, towards bringing defamation proceedings in the ACT Supreme Court, but no action was begun in the ACT Supreme Court because, by the time Mr Whitlam had decided to commence proceedings, his cause of action under the law of the ACT had become statute barred.
The settlement of the second set of proceedings that Mr Whitlam brought against Channel Nine was achieved between the time of the judgment the subject of this appeal, and the hearing of the appeal. Evidence of that settlement was admitted on the appeal. Because the trial judge took the view that, in substance, Mr Whitlam would be entitled to an indemnity in relation to his costs of either the discontinued Channel Nine proceedings, or the second Channel Nine proceedings only if he was, in substance, successful in his allegation of defamation against Channel Nine, there was no occasion for the trial judge to make any finding of the quantum of costs that Mr Whitlam had incurred in connection with either of those sets of proceedings against Channel Nine. However an affidavit has been filed that establishes that the total amount of costs claimed by Mr Whitlam in these proceedings exceeds $100,000 so leave to appeal under section 101(2)(r) Supreme Court Act 1970 is not required.
Chronology of Relevant Events
Mr Whitlam became a director of NRMA on 2 December 1995, and was appointed its President on 5 December 1996.
On 25 November 1999 the first of the deeds on which Mr Whitlam sues (“the 1999 Deed”) was executed.
The interview between Mr Whitlam and Mr Lyons was recorded on 6 March 2001. The broadcast of the television programme that Mr Whitlam asserted was defamatory took place on 11 March 2001. The interview on 2GB that was the subject of the 2GB defamation action went to air on 13 March 2001.
On 15 March 2001 Mr Whitlam started incurring legal costs in pursuing his claims against Channel Nine and 2GB.
The defamation proceedings that Mr Whitlam brought against 2GB were commenced on 18 May 2001.
On four occasions between 18 March 2001 and 2 December 2001 Channel Nine made broadcasts that repeated part of the matter which Mr Whitlam alleged was defamatory.
On 18 February 2002 a jury in the District Court found that the 2GB interview defamed Mr Whitlam.
On 3 May 2002 the 2GB proceedings settled.
On 22 July 2002 Mr Whitlam resigned as President of NRMA (but retained his position as a director).
On 7 August 2002 the second deed on which Mr Whitlam sues (“the 2002 Deed”) was executed.
On 6 September 2002 Mr Whitlam resigned as a director of NRMA.
On 19 December 2002 Mr Whitlam filed the Statement of Claim to commence the first set of proceedings against Channel Nine in the District Court.
On 17 March 2003 Mr Whitlam discontinued those District Court proceedings.
On 20 December 2004 Mr Whitlam began proceedings in the Supreme Court of New South Wales against NRMA, seeking to enforce his claim to be entitled to be indemnified for the legal costs.
The reasons for judgment in relation to which this appeal is brought were delivered on 3 August 2006, and declarations and orders to give effect to them were made on 1 September 2006.
On 21 December 2006 Mr Whitlam began the second set of proceedings in the District Court of New South Wales against Channel Nine.
On 27 February 2007 a deed was entered into between Mr Whitlam and various parties connected with Channel Nine, settling the Channel Nine defamation proceedings.
The 1999 Deed
The 1999 Deed was between NRMA and Mr Whitlam. In it, Mr Whitlam was referred to as the “Officer”. So far as relevant it provided:
“Recitals
A.Under Rules 159 to 161 of the NRMA Constitution, the Officer is entitled to indemnity and insurance in relation to service as an officer of NRMA Group Companies.
B.This deed confirms the basis on which NRMA will:

indemnify and insure the Officer (including after cessation of his or her office);
allow the Officer to access documents produced or circulated during the term of his or her office.
1             Indemnity
1.1         Indemnity
NRMA indemnifies the Officer on a full indemnity basis and to the full extent permitted by law against all Liabilities incurred by the Officer as an officer of any NRMA Group Company, including without limitation a liability for negligence and for reasonable costs and expenses, not limited to taxed costs incurred:
(a)in defending proceedings, whether civil or criminal, in which judgement is given in favour of the Officer or in which the Officer is acquitted; and
(b)in connection with an application in relation to such proceedings in which the Court grants relief to the Officer under the Corporations Law.
1.2         Extent of Indemnity
The indemnity in clause 1.1:
(a)is enforceable without the Officer having to first incur any expense or make any payment;
(b)is a continuing obligation and is enforceable by the Officer even though the Officer may have ceased to be an officer of the relevant NRMA Group company;
(c)          survives the termination of this deed;
(d)applies to Liabilities incurred both before and after the date of this deed;
(e)          does not operate to the extent that the Liability:
(1)is a liability to any NRMA Group Company unless and to the extent that the Officer may be indemnified pursuant to subsection 241(3) of the Corporations Law; or
(2)arises out of conduct of the Officer involving a lack of good faith, wilful misconduct, gross negligence, reckless misbehaviour or fraud;
(f)does not extend to and is not an indemnity against any amount in respect of which the indemnity would otherwise be illegal, void, unenforceable or not permitted by law.
2             Claims
2.1         Notification by Officer
The Officer must immediately advise NRMA in writing on the Officer becoming aware of:
(a)any Claim against the Officer; or
(b)any circumstance which could reasonably be expected to give rise to a Claim against the Officer;
which involves, or may involve, a Liability for which the Officer may seek indemnity under clause 1.
2.2Conduct of defence by NRMA
If a Claim is notified under clause 2.1, NRMA may:
assume on behalf of the Officer the conduct of the defence of the Claim under NRMA’s sole management, control and cost or permit an insurer of the Officer’s liability to do so;
institute legal proceedings in the name of the Officer as part of that defence; or
settle the Claim or any related legal proceedings with the consent of the Officer (such consent not to be unreasonably withheld).
In exercising its rights under this clause 2.2, NRMA must instruct its lawyers on behalf of both NRMA and the Officer to ensure as far as possible that client legal privilege attaches, for the benefit of both NRMA and the Officer, to any document produced by those lawyers.
2.3Officer’s Obligation
If a Claim is notified under clause 2.1, the Officer must:
take such action or provide such information in relation to the Claim as NRMA may reasonably require;
assist NRMA to the best of the Officer’s abilities in any action NRMA may take to avoid, dispute, defend or appeal any legal action connected with the Claim; and
not admit any liability for, or settle any action connected with, the Claim without the prior written consent of NRMA (such consent not to be unreasonably withheld).
2.4Conduct of Defence by Officer
Subject to any exercise by NRMA of its rights under clause 2.2, the Officer may conduct the defence of any Claim notified by it under Clause 2.1. In this event, the Officer must seek the prior consent of NRMA (such consent not to be unreasonably withheld) as to:
the legal advisers to be used by the Officer;
the amount of any expenditure to be incurred in respect of the Claim; and
the terms of any settlement of the Claim.
2.5         Advances to Director
Subject to this deed, if a Claim is notified under clause 2.1, and NRMA considers on a reasonable basis that indemnity will be required for the Claim under this deed, NRMA may advance money to the Officer prior to any resolution of the Claim to meet any costs or expenses of the Officer relating to the Claim. Any such advance will be on such terms as NRMA thinks fit, including any terms as to interest, repayment or security.
2.6         Taxation
If for any reason a payment under this deed is or will be treated as assessable income of the Officer under any law relating to tax, NRMA must pay to the Officer an additional amount so that, after withholding or deducting from the total payment all tax payable in respect of the payment, the balance remaining is equal to the amount the Officer would receive if no tax had been payable.
2.7         Repayment of Amounts
The Officer must repay to NRMA any amount (including any advances) paid to, or on behalf of, the Officer under this deed:
(a)within 28 days after written demand by NRMA to the Officer, to the extent that in the reasonable opinion of NRMA the amount paid exceeds the amount to which the Officer is properly entitled under this deed;
(b)immediately, to the extent the Officer receives an amount in respect of the relevant Liability from any other person (including, without limitation, any insurer or unsuccessful claimant)
…
6             General
…
6.6         Entire agreement
This deed:
(a)constitutes the entire agreement between the parties as to its subject matter; and
(b)in relation to the subject matter, supersedes any prior understanding, deed or agreement between the parties and any prior condition, warranty, indemnity or representation imposed, given or made by a party.
…
6.9         Document priority
If there is an inconsistency between this deed and the Constitution of NRMA, to the extent permitted by law, the provisions of this deed are paramount.
6.10       Termination of previous deeds
On the execution of this deed any current deed of insurance access and indemnity between the parties in the form of the deed approved at the 1998 Annual General Meeting of NRMA is hereby terminated.

A schedule to the Deed included the following interpretive aids.
“Part 1
In this deed:
…
Claim means any allegation, cause of action, proceedings, claim, suit or demand of any nature whatsoever;
…
Liability means any loss, liability, cost, charge or expense;”
NRMA Constitution
The reference in recital A of the 1999 Deed to “Rules 159 to 161 of the NRMA Constitution” was a manifest error, because at that time the last rule in the Constitution was numbered 159. Rule 159 said:
“Except as by the Law precluded, every officer, auditor or agent of the Association shall be indemnified by the Association against any liability incurred by that person in that capacity.”
Clause 1 of the Constitution provided a definition, whereby:
“”the Law” means the Corporations Law and includes any amendment or re-enactment of it or any legislation passed in substitution for it;”
The 2002 Deed
The 2002 Deed was in identical terms to the 1999 Deed, save in the following respects:

NRMA was referred to by the name “Association” rather than by the name “NRMA”;
The mistake in Recital A was corrected, by removing the expression “Rules 159 to 161”, and replacing it with “Rule 159”;
Paragraph 1.2(e) was replaced by a paragraph reading:
“does not operate to the extent that the Liability:
(1)is a liability to any Association Group Company unless and to the extent that the Officer may be indemnified pursuant to subsections 199A(2) or 199A(3) of the Corporations Act; or
(2)arises out of conduct of the Officer involving a lack of good faith, wilful misconduct, gross negligence, reckless misbehaviour or fraud;”

Clause 6.10 was replaced by a clause reading:
“Termination of previous deed
On the execution of this deed any current deed of insurance access and indemnity between the parties in the form of the deed approved at the 1998 or 1999 Annual General Meetings of Association is hereby terminated.”
A new definition was added, whereby
“Corporations Act means the Corporations Act, 2001”
Legislative Limitations on Granting Indemnity

At the time the 1999 Deed was executed, section 241 of the Corporations Law limited the circumstances in which a company could indemnify a person who was or had been an officer or auditor of the company.
Section 241 was repealed effective from 3 March 2000. An analogous subject matter to that with which section 241 had dealt was thenceforth dealt with by a new section 199A of the Corporations Law. It imposed a prohibition on a company indemnifying an officer or auditor that was narrower than the prohibition section 241 had imposed.
When the Corporations Act 2001 (Cth) came into effect on 1 July 2001, it contained a section 199A that was in identical terms to section 199A of the Corporations Law.
Common Factual Ground
There are several findings by the learned trial judge that NRMA does not dispute in this appeal:
“90I am satisfied that, on balance, the allegations made against the plaintiff in the broadcast arose directly out of performance of his duties, that is, his authorised interview with Nine. The defendant knew, or ought to have known, that Nine could, and indeed it was likely it would, manipulate the interview to suit the story that it wished to publish. I am also satisfied that the defendant would or ought to have known that once it authorised the plaintiff to attend the interview with Mr Lyons the plaintiff was at risk of being criticised as the Chairman of the defendant and the defendant was also at risk of being criticised. The defendant specifically advised the plaintiff on the way in which he was to deal with topics to be raised in the interview. The plaintiff was acting on behalf of the defendant in the interview for the purposes of ensuring that the defendant’s conduct was seen in a good light. The plaintiff was not being interviewed in his personal capacity but rather as the Chairman and director of the defendant. If the defendant had not authorised plaintiff to give the interview, the broadcast would not have conveyed the specific defamatory imputations.”
After the programme went to air, there were various discussions between Mr Whitlam and officers of NRMA. The learned trial judge made the following findings, which were not attacked on the appeal.
“9The plaintiff discussed the broadcast with the defendant's General Counsel, Jenny Kelly, and on 12 March 2001 Ms Kelly advised the plaintiff that he and the defendant would need to “cooperate” on their respective responses to the broadcast. Ms Kelly advised the plaintiff that she would keep him informed of what the defendant was doing and the legal advice it received as to whether it should sue Nine. She expressed the opinion that the plaintiff's interests and the defendant’s interests were the same and that they had “both been defamed by the same program”. Ms Kelly advised the plaintiff that he and his lawyers would need to work closely with the defendant and its lawyers and that such process “should also keep the legal costs down”. On 23 March 2001 Ms Kelly provided the plaintiff with a copy of an advice the defendant had received from its solicitors in relation to the broadcast. That advice concluded that “many of the statements made during the broadcast are defamatory of NRMA, its directors and some executives”.
10On 18 or 19 July 2001 the defendant commenced defamation proceedings against Nine in the Supreme Court of the Australian Capital Territory (ACT) in respect of the broadcast. It alleged that the broadcast conveyed imputations that: (a) the defendant was subject to corrupt control and management; (b) the defendant attempted to blackmail one of its directors; (c) the defendant attempted to bribe one of its directors; (d) the defendant was without stable governance; (e) the defendant was so lacking in stable governance and direction that investors should not risk dealing with it; (f) the defendant had betrayed the public's faith in it as one of Australia's most trusted companies; (g) the defendant had acted with gross negligence in failing to prevent illegal public disclosure of its commercially sensitive information; (h) the defendant was directed by an untrustworthy Board; (i) the defendant had become the instrument of its Chairman in that its activities were conducted in the interests of himself and his cronies to the detriment of its members; and (j) the defendant acted improperly in that it awarded contracts to those who served the private interests of Board members.”
Imputations (i) and (j), pleaded by NRMA, are closely similar to some of the imputations that Mr Whitlam later pleaded in his own defamation action.
A measure of co-operation continued between Mr Whitlam and NRMA concerning their respective pieces of litigation. In April and August of 2001 he was informed of advice that NRMA had received relating to the broadcast, and as late as 3 December 2002 NRMA’s solicitors sent a facsimile to Mr Whitlam’s solicitors attaching a copy of an amended statement of claim filed in NRMA’s proceedings, that Mr Whitlam’s solicitors had requested to assist in the finalisation of his proceedings.
Mr Whitlam gave evidence that was not challenged in cross-examination that in mid to late March 2001 he specifically asked Ms Kelly whether NRMA would meet any costs he incurred obtaining advice and pursuing proceedings for defamation against Channel Nine. Soon after, Ms Kelly informed him that NRMA would not meet those costs. Following that, Mr Whitlam sought to have NRMA Board pass a resolution whereby directors with disputes with each other or with NRMA could have those disputes dealt with by conciliation. At a board meeting on 26 August 2002, the Board resolved to adopt a process by which claims of directors on NRMA would be resolved by confidential mediation. On 26 August 2002 Ms Kelly asked Mr Whitlam to submit any claims he had for mediation. He submitted a claim on 26 August 2002, making claims that included a claim to be paid costs associated with his defamation proceedings. A mediation was held on 17 September 2004, but did not result in a resolution. NRMA maintained the position at all times that it was not able to make any payment whatsoever.
Other findings by the learned trial judge that are not challenged on this appeal are:
“101 There is also no issue that the plaintiff honestly believed that his conduct would ultimately be vindicated but that the process in the courts would take some time. I am satisfied that the plaintiff’s discontinuance of the defamation proceedings was reasonable. I am also satisfied that the plaintiff’s settlement of the 2GB proceedings was reasonable. He took the very reasonable step of accepting an apology and did not incur any further costs in the proceedings by seeking to recover damages from 2GB.”

Which Deed Applies?
There was argument in the court below, and on the appeal, about whether any right to indemnity that Mr Whitlam might have was governed by the 1999 Deed, or the 2002 Deed, or partly by one and partly by the other. That was of significance because there was argument about whether the type of indemnity that Mr Whitlam contended the 1999 Deed gave rise to contravened section 241 of the Corporations Law. NRMA accepted that section 199A of the Corporations Law, in the form it had after 3 March 2000, and section 199A of the Corporations Act did not prohibit NRMA from granting an indemnity of the type that Mr Whitlam claimed the 1999 Deed and the 2002 Deed both granted.
In my view, if the promise of indemnity contained in Clause 1.1 of the 2002 Deed extends, as a matter of construction, to providing indemnity for legal costs incurred by Mr Whitlam in pursuing the defamation actions after 7 August 2002, it also provides indemnity for such costs incurred prior to 7 August 2002. That is because the indemnity under Clause 1.1 is “against all Liabilities incurred by the Officer as an Officer of any Association Group Company”. Mr Whitlam’s argument is that there are two different types of entity that count as “Liabilities” – the first is his suffering of loss in the form of damage to his reputation, while the second is his incurring of a liability to his solicitors to pay legal costs. Accepting for the moment the correctness of that argument, Clause 1.2(d) expressly states that the indemnity in Clause 1.1 “applies to Liabilities incurred both before and after the date of this deed”. Both of the types of entity that Mr Whitlam contends count as “Liabilities” within the meaning of Clause 1.1 are thereby covered.
Clause 6.10 of the 2002 Deed terminates the 1999 Deed. There are two possibilities about the legal effect of that termination.
The first possibility is that the termination has the legal effect that thenceforth the 1999 Deed cannot be a source of new legal rights, but any legal rights that had accrued under the 1999 Deed would survive the termination. If it were the case, however, that any right to indemnity had already accrued under the 1999 Deed, the fact that it survived in this fashion would not mean that the express terms of Clause 1.2(d) of the 2002 Deed would not take effect in accordance with their terms. In that situation, there would simply be two different contractual obligations, one arising under the 1999 Deed, and one arising under the 2002 Deed, to make the same payment.
The second possibility is that it is the effect of Clause 6.6(b) of the 2002 Deed that the 1999 Deed has been totally superseded, even in relation to existing liabilities. Deciding whether that conclusion is correct would necessitate considering the effect of the express provision in Clause 1.2(c) of the 1999 Deed, that the indemnity in Clause 1.1 of the 1999 Deed survives the termination of the 1999 Deed.
It is not necessary to decide which of these alternatives is correct. That is because, if the construction of Clause 1.1 of the 2002 Deed for which Mr Whitlam contends is correct, it covers all of the legal costs concerning which he seeks indemnity.
It is not contended that the scope of the indemnity conferred by the 1999 Deed is any wider than the scope of the indemnity conferred by the 2002 Deed. In these circumstances, it is not necessary to consider whether the 1999 Deed is incapable of being, during all or any of the period during which it was on foot, a source of rights of the type Mr Whitlam claims, by reason of section 241 Corporations Law.
Relevance of Clause 2?
The trial Judge derived some assistance, in construing the indemnity in clause 1.1, from the terms of Clause 2, and what counted as a "Claim". In particular, reliance was placed on the fact that a "Claim" includes “any allegation … of any nature whatsoever", that the imputations made concerning Mr Whitlam's conduct by the broadcast were such an allegation, that Clause 2.2 permitted NRMA to "assume on behalf of the Officer the conduct of the defence of the Claim", and that the way one defended oneself against the making of a defamatory allegation was by bringing proceedings for defamation. Thereby, the trial judge reasoned, NRMA may assume the defending of Mr Whitlam against an "allegation … of any nature whatsoever" including a defamatory imputation. Though not explicitly spelt out, I would infer that the trial judge took the view that, if NRMA could take over the conduct of Mr Whitlam's of defamation proceedings, it was hardly to be expected that NRMA would not also have liability for the costs of those proceedings.
I do not accept that that process of reasoning assists in the elucidation of the indemnity. The obligation in Clause 2.1 is for the officer to advise NRMA of a Claim or circumstance which could reasonably be expected to give rise to a Claim, and "which involves, or may involve a Liability for which the officer may seek indemnity under clause 1." Thus, before one can apply Clause 2.1, it is necessary to already know what is the proper scope of the indemnity provided under Clause 1. If an allegation of bad conduct on the part of Mr Whitlam in the conduct of his office could not involve a Liability for which he might seek indemnity under Clause 1, there is no obligation on him to notify any such allegation under Clause 2.1. NRMA's power to conduct the defence of a Claim under Clause 2.2 arises only "if a Claim is notified under clause 2.1". Thus, if, as a matter of the proper construction of Clause 1.1 NRMA would not have a Liability concerning the costs of those proceedings, it has no power to take over the conduct of the proceedings.
49 Thus I turn directly to consider the construction of the indemnity granted by Clause 1.1.

Construction of the Indemnity – Indemnity for Loss of Reputation?
When the hearing below began, Mr Whitlam’s claims included not only seeking reimbursement for expenses that he incurred in bringing the defamation claims, and a declaration that NRMA was liable to indemnify him for future expenses in pursing those claims, but also indemnity for the loss he claimed to have suffered through damage to his reputation, and consequential loss of earning capacity and injury to his feelings. The suffering of a “loss” was submitted to be relevant to the indemnity because the expression “all Liabilities” in Clause 1.1 of the 2002 Deed means, if one applies the definition in Part 1 of the Schedule to the Deed “all losses, liabilities, costs, charges or expenses”.
In the course of the trial Mr Gleeson SC, counsel for Mr Whitlam, limited the remedy that was sought to particular paragraphs of the Further Amended Summons, being, broadly, those paragraphs that claimed reimbursement of paid legal expenses concerning the defamation claim, and a remedy concerning payment of such expenses in the future. However, the Further Amended Summons was not amended to delete allegations that as a result of the Channel Nine broadcast Mr Whitlam had suffered loss in the form of damage to his reputation, and consequential loss of earning capacity and injury to feelings. Thus, it remained an issue on the pleadings whether he had suffered those types of loss.
Mr Gleeson submitted to the trial judge that there was unchallenged evidence from Mr Whitlam that he had suffered those types of loss. Mr Gleeson put the case by saying that, even though no claim was made against NRMA for damages to compensate him for suffering that type of loss, there was evidence that it had been sustained. Incurring of expenditure to commence and pursue the defamation litigation was, he submitted, a reasonable step to take in mitigation of that loss. Both the damage to reputation and consequential loss of earning capacity and injury to feelings were, it was submitted, the type of “loss” that fell within the indemnity. And, it was submitted, when a loss of a particular type is within the scope of a contract of indemnity, the indemnity also covers the expense involved in taking reasonable steps to mitigate any such loss. In that way, the expenditure for legal costs was covered by the indemnity.
An argument to that effect was also put on the appeal.
Mr Gleeson reminded us that in Brabazon v Western Mail Ltd (1985) 8 FCR 122 Toohey J had expressed the opinion that “loss or damage” in section 82 Trade Practices Act 1974 (Cth) can include loss of reputation. In my view that obiter opinion is not determinative of the present case. First, it concerned the expression “loss or damage”, not merely the expression “loss”. Further, “loss or damage” in section 82 Trade Practices Act 1974 (Cth) appears in a context where the word “loss” is not accompanied by the other words that go to make up the definition of “Liability” in the contract presently under consideration. Third, section 4K Trade Practices Act 1974 (Cth) expressly states that a reference to loss or damage includes a reference to injury, and there is no corresponding extension of the meaning of “loss” in the deed conferring indemnity.
I readily accept that a loss of reputation can fall within the range of meanings that "loss" has as an ordinary English word. The question, however, is whether "loss", in the present contract of indemnity, includes a loss of reputation. If loss of reputation fell within the scope of the contract as something in relation to which indemnity has been agreed to be granted, that indemnity would not cease to operate merely because that type of loss is also able to be remedied by an action for defamation: cf Malik v Bank of Credit and Commerce International SA (in Compulsory Liquidation) [1998] AC 20 at 40 – 41
In deciding the question of construction, assistance can be obtained from the purpose of the indemnity provision, and from the context in which the word "loss" occurs.
I have considered whether help in ascertaining the purpose of the indemnity can be obtained from the specific reference in recital A to Rule 159 of the NRMA Constitution. From the fact that Rule 159 is mentioned in the recital, one can conclude that at least one of the purposes of the Deed is to provide the sort of indemnity to which Rule 159 refers. Rule 159 evinces an intention to provide an indemnity to an officer of NRMA "against any liability incurred by that person in that capacity ". It says nothing about providing indemnity against losses that are not liabilities of the officer. The type of loss of reputation that Mr Whitlam seeks indemnity for is not a loss sustained by reason of him having any liability – rather, it has happened to him regardless of any liabilities he has. In deciding what, if any, use can be made of that fact, one needs to bear in mind that Clause 6.9 of the Deed makes the provisions of the Deed paramount over those of the Constitution if there is an inconsistency. However, before Clause 6.9 can operate there must first be such an inconsistency. It could be argued that there is such an inconsistency, precisely because the word "loss" appears in the definition of "Liability", in addition to the word "liability". But whether that is indeed an inconsistency will depend upon whether, in this context, the word "loss" has a different meaning to that of "liability". And that is itself part of the problem of construction that I am trying to solve. Thus, I do not derive assistance from Rule 159.
The principle of construction whereby a commercial document that is elliptical or ambiguous should not be given a construction that is commercially unlikely is well established: Cohen & Co v Ockerby & Co Ltd (1917) 24 CLR 288 at 299-300 per Isaacs J; The Council of the Upper Hunter County District v Australian Chilling and Freezing Co Ltd (1968) 118 CLR 429 at 436-437; Schenker & Co (Aust) Pty Ltd v Maplas Equipment and Services Pty Ltd [1990] VR 834 at 843-8; Hide & Skin Trading Pty Ltd v Oceanic Meat Traders Ltd (1990) 20 NSWLR 310 at 313-14 per Kirby P; Antaios Compania Naviera S A v Salen Rederierna A B [1985] AC 191 at 201; Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896 at 913. A reason why courts approach the construction of commercial documents in that way is because they recognise that it is likely that the purpose of the business people who entered them was to bind themselves to a document that operated in a sensible commercial way. That principle of construction should be applied to the indemnity involved in the present case.
The word “loss” has a wide range of meanings, as appears from the Macquarie Dictionary definition:
“1.detriment or disadvantage from failure to keep, have, or get: to bear the loss of a robbery.
2.that which is lost.
3.amount or number lost.
4.a being deprived of or coming to be without something that one has had: loss of friends.
5.a bereavement.
6.the accidental or inadvertent losing of something dropped, misplaced, or of unknown whereabouts: to discover the loss of a document.
7.a losing by defeat, or failure to win: the loss of a bet.
8.a failure resulting in a waste of time, resources, etc.: that meeting was a complete loss.
9.failure to preserve or maintain: loss of speed.
10.destruction or ruin: the loss of Coventry Cathedral in World War II.
11.Commerce failure to recover the costs of a transaction or the like, in the form of benefits derived.
12.Military
a.            the losing of soldiers by death, capture, etc.
b.            (often plural) the number of soldiers so lost.
13.         Insurance
a.occurrence of a risk covered by a contract of insurance so as to result in insurer liability.
b.that which causes such a loss.
c.an example of such a loss.”
When one bears in mind the need to construe the indemnity in the present case to give it a sensible commercial meaning, it is apparent that the full possible range of meanings of “loss” is not intended to be the subject of the indemnity. If a person in Mr Whitlam’s position were to lose some friends as a consequence of carrying out his duties, or to lose some sleep, it is not commercially realistic to expect such a loss to be covered. A choice therefore needs to be made about which of the potential meanings of the word “loss” is intended to be the subject of this indemnity.

If it were the case that the indemnity in the present case extended to providing compensation for loss of reputation, there would be some unusual practical consequences. If it were the case that a company executive, with an indemnity in the same terms as that given to Mr Whitlam, ran the company extremely badly, and that fact became known so that his or her reputation suffered, it is hardly likely that the company would have intended the indemnity to cover that sort of loss of reputation. Likewise, it could sometimes happen that a company executive suffered a loss of reputation simply because he or she was in charge of the company at a time when external events that he or she could not fairly be expected to influence or control impinged on the company. It does not seem commercially likely that the indemnity would be intended to extend to that sort of loss of reputation. Yet, if “loss” in the definition of “Liability” includes a loss of reputation, it would cover losses of reputation arising in those circumstances. Yet there do not appear to be any words that restrict a loss of reputation that may be within the scope of the indemnity to some limited class of losses of reputation, such as (as is relevant in the present case) a loss that is caused by wrongful conduct of another person.
Further, the law of defamation is notoriously complex. The complexity is the result of seeking to balance competing interests. One type of interest involves an individual’s interest in maintaining a good reputation. Other types of interest include the public interests involved in not placing unreasonable limits on freedom of expression. These interests are expressed in various specific aspect of the defamation law, such as those permitting publication of matters that are substantially true, permitting publication and discussion of matters of public interest and importance, permitting publication of matter to classes of people who have a special interest in knowing the truth about that matter, permitting the making of comment that has a proper basis, and sometimes permitting publication of matter that the publisher had no reason to know was defamatory. It would be a surprising coincidence if the intention of the parties was to provide an indemnity against loss of reputation that arose in precisely those circumstances in which the law, as a result of the balancing of private and public interests that has led to the present state of the law of defamation, gives a remedy in damages for defamation. There are no words to indicate that that is what the parties intended.
In my view, considering the likely purpose of the indemnity does not lead to the conclusion that it was likely to have been intended to extend to cover a loss of reputation arising from a defamation.
I turn to consider whether any assistance can be derived from the context in which “loss” occurs. In Lend Lease Real Estate Investments Ltd & Anor v GPT RE Ltd [2006] NSWCA 207 at [30]-[31] Spigelman CJ, with whom McColl and Basten JJA agreed, said:
30The general principle of the law of interpretation that the meaning of a word can be gathered from its associated words – noscitur a sociis – has a number of specific sub-principles with respect to the immediate textual context. The most frequently cited such sub-principle is the ejusdem generis rule. The relevant sub-principle for the present case is the maxim propounded by Lord Bacon: copulatio verborum indicat acceptationem in eodem sensu – the linking of words indicates that they should be understood in the same sense. As Lord Kenyon CJ once put it, where a word “stands with” other words it “must mean something analogous to them”. (Evans v Stevens (1791) 4 TR 224; 100 ER 986 at 987. See also W J Byrne (ed) Broomes Legal Maxim (9th ed) Sweet and Maxwell, London (1924) pp373-374.)
31However, as Lord Diplock put it in Letang v Cooper [1965] 1 QB 232 at 247:
“The maxim noscitur a sociis is always a treacherous one unless you know the sosietas to which the socii belong.””
In Frauenfelder v Reid(1963) 109 CLR 42 at 53 Windeyer J considered a phrase “threshing, chaff cutting, ploughing, or other agricultural work” in a statute. He said:
“… if the phrase ‘agricultural work’ stood alone, it would not necessarily be read as excluding the work of tending and managing flocks and herds. But it does not stand alone. And it is the context in which it stands that narrows its meaning. ‘Threshing, chaff cutting, ploughing or other agricultural work’ – surely other agricultural work is here noscitur a sociis? It comprehends, it seems to me, any work that is agricultural in the sense that ploughing, threshing, chaff cutting are – that is to say any of the ordinary operations of tilling the soil, sowing, harvesting and the treatment on the farm of the crops.”
In the present case, if one considers the words that accompany “loss” in the definition of “Liability”, the words “costs, charge or expense” all relate to money that has been expended by Mr Whitlam, or concerning which Mr Whitlam has an obligation to pay. The word “liability” means, in the context of the definition of “Liability” in the 2002 Deed, a legal obligation to make a payment or do some other act that will cause expense or other difficulty to the person with the liability. The words “liability, costs, charge or expense” have a common characteristic in that they all relate to a payment actually made, or a payment or other incurring of a detriment that the person in question sustains as a matter of legal obligation. In my view, the word ”loss” in the definition of “Liability” is to be construed as having a similar shade of meaning. As so construed, it does not include a loss of reputation.
Finally, in Andar Transport Pty Ltd v Brambles Ltd (2004) 217 CLR 424 the joint judgment of Gleeson CJ, McHugh, Gummow, Hayne and Heydon JJ laid down, at 433-437, [17]-[23] the principles of construction that are now to be applied to contracts of indemnity. Their Honours noted (at 433, [17]) the settled principle that in interpreting contracts of guarantee:
“… the liability of the surety is strictissimi juris and … ambiguous contractual provisions should be construed in favour of the surety. The doctrine of strictissimi juris provides a counter-poise to the law’s preference for a construction that reads a provision otherwise than as a condition. A doubt as to the status of a provision in a guarantee should therefore be resolved in favour of the surety.” (Ankar Pty Ltd v National Westminster Finance (Australia) Ltd (1987) 162 CLR 549 at 561, approved in Chan v Credson Pty Ltd (1989) 168 CLR 242 at 256.)
Their Honours concluded, at 437, [23]:
“However, notwithstanding the differences in the operation of guarantees and indemnities, both are designed to satisfy a liability owed by someone other than the guarantor or indemnifier to a third person. The principles adopted in Ankar, and applied in Chan, are therefore relevant to the construction of indemnity clauses.”
What their Honours meant by saying that the principles are “relevant to” the construction of indemnity clauses is shown by the way they in fact carried out the task of construction in the case before them, at 437-438, [24]-[28]. Their Honours noted various factors that tended towards construing the indemnity in a way that would result in it not applying to the particular liability in question, and concluded, at [29]:
“Finally, to the extent that cll 8.2.2 and 8.2.3 remain ambiguous, the principles of construction outlined earlier in these reasons require the provisions to be construed in favour of [the party providing the indemnity].”
Those principles for construction of an indemnity have since been applied in this Court in Ayoub v Euphoric Pty Ltd (2004) 12 BPR 22,735 at [41] (per McClellan AJA with whom Beazley and Bryson JJA agreed – a case of combined guarantee and indemnity); F & D Normoyle Pty Ltd v Transfield Pty Ltd t/as Transfield Bouygues Joint Venture & Anor (2005) 63 NSWLR 502 at 511-512, [60]-[67] (per Ipp JA, with whom McColl JA agreed) and in Colliers Jardine Pty Ltd v Castle Mall Properties Pte Ltd [2005] NSWCA 311 at [40]-[41] per Tobias JA (with whom McColl JA and Brownie AJA agreed). In my view, the ambiguity about whether “loss” in the definition of “Liability” extended to a loss of reputation of the kind actionable in defamation should, for the reasons given at paras [54]-[65] above, be resolved by deciding it does not so extend. However, if I were wrong in that conclusion, and ambiguity remained, it would, in accordance with the principle of construction adopted in Andar, be construed in a way that was favourable to NRMA. For these reasons, the first way in which Mr Whitlam puts his case for indemnity fails. In my view, Clause 1.1, on its proper construction, does not provide an indemnity against the type of loss that is involved in suffering damage to reputation, or consequential damage to earning capacity or feelings.
Construction of the Indemnity – Applies Directly to Costs Incurred?
The second way in which Mr Whitlam contends that his claim for the legal costs falls within the indemnity is that those legal costs are “costs, charges or expenses” within the definition of “Liability”. That much may readily be accepted.
It is common ground, and obviously correct, that the costs in question do not fall within either para (a) or (b) of Clause 1.1 of the indemnity. Mr Gleeson’s contention is that they satisfy the text of Clause 1.1 by being costs that were “incurred by the Officer as an officer of” NRMA.
Mr Gleeson’s argument was in substance as follows. It was only because of Mr Whitlam’s carrying out his duties as NRMA President that he gave the interview at all. He gave the interview with the authority of NRMA, and after making specific enquiries of senior officers of NRMA about the desirability of giving the interview. The subject matter of the interview related to the affairs of NRMA. The various criticisms that were made of Mr Whitlam by the television broadcast were ones that concerned the manner in which he had acted while President, and in his role as President. The taking of the defamation proceedings was a reasonable way of mitigating the loss he had sustained to his reputation by reasons of his performance of his duties, and so the incurring of those costs was incurring the costs “as an officer”.
Mr Gleeson notes that NRMA accepts that if Mr Whitlam had been sued for damages by reason of some act he had performed in connection with his duties as an officer of NRMA, then any costs involved in defending that action would be within the scope of the indemnity. Mr Gleeson submits that that situation cannot properly be distinguished from the situation where Mr Whitlam has expended costs in commencing and maintaining proceedings, to defend the injury he sustained to his reputation as a consequence of performing his duties. He submits that where an officer is sued, the interests at stake are, most commonly, the officer’s personal financial interest, or the officer’s interest in his or her liberty or reputation. Analogously, he says, when an officer sues for defamation, the interests at stake are again, most commonly, the officer’s personal financial interests, or the officer’s interest in his or her reputation. The whole point of the indemnity, he submits, is to protect NRMA’s officers from suffering personal loss as a result of the performance of their professional responsibilities.
In my view, this argument should not succeed. NRMA is correct in accepting that if Mr Whitlam were to have been sued for damages for an action he had carried out in the course of his duties, his legal costs in defending that action would be within the scope of the indemnity. One reason is because they would, at least in circumstances in which judgment is given in favour of Mr Whitlam, fall within para (a) of Clause 1.1. However, ignoring for the moment any restrictions on a company granting an indemnity to an officer that might have once arisen under section 241 Corporations Law, or that now exist under section 191A Corporations Act, such legal costs also fall within the more general words of Clause 1.1 that provide an indemnity against liabilities incurred as an officer, even if judgment was given against Mr Whitlam. The reason why they would be within the scope of the indemnity in this way is that if the allegation against him were true, and he had a liability to the plaintiff in any such action, the amount of money that he paid pursuant to that liability would be within the scope of the indemnity. And when an indemnity is given against some particular species of legal liability, that indemnity is construed as extending to the legal costs involved in defending litigation that seeks to enforce such a liability: Halsbury’s Law of England, 4th edition, volume 20(1) (2004), para 352 says:
“The holder of an indemnity, when acting within the scope of his authority, is generally entitled to recover the amount payable by him by virtue of any judgment recovered against or compromise reasonably made by him in any legal proceedings in respect of any matter comprised by the indemnity, together with all costs properly incurred in defending such legal proceedings, including his own costs.”
Halsbury, op cit, para 353 says:
“In all cases where there is a contract of indemnity the costs of legal proceedings properly incurred by the person indemnified are recoverable under the indemnity.”
Similarly, in NSW v Tempo Services Ltd [2004] NSWCA 4 at [21] Hodgson JA, with whom Giles JA agreed, said:
“An indemnity in respect of “claims” includes an indemnity against costs reasonably incurred in defending claims.”
See also O’Donovan & Phillips, Modern Contract of Guarantee, para [5.420]
The costs of legal proceedings that fall within an indemnity under this principle are not restricted to those that would have been allowed on a taxation on a party/party basis. Howard v Lovegrove (1870) 6 LR Ex 43 held that the “own costs” that the person indemnified was entitled to recover were the amounts actually paid to his solicitor, not merely such amounts as might be allowed on a party/party taxation. That case should not be taken as deciding, however, that solicitor/client costs would be allowed under an indemnity beyond the extent that they were reasonable. Thus, Buckley J in Great Western Railway v Fisher [1905] 1 Ch 316 at 324-5 said:
“… a distinction is to be drawn between cases in which a person is entitled by contract to an indemnity and cases in which a person is simply recovering damages. If a person is entitled to an indemnity, there may be a right to solicitor and client costs; but where he is simply recovering damages he would not in general get solicitor and client costs … I think [the person who gave the indemnity] ought to bear that which [the company that received the indemnity] necessarily bore – that is to say, their proper costs as between solicitor and client.”
The expression “as an officer” has in the present context the shade of meaning of “while acting in the role of an officer”. If an officer is sued for a liability he or she is alleged to owe by reason of his or her actions in the role of an officer, it is within the scope of the indemnity. It is because any such liability is within the scope of the indemnity that reasonable costs incurred in defending any such assertion of liability are themselves also within the scope of the indemnity.
The same cannot be said, however, about the legal costs that an officer sustains in bringing defamation proceedings by reason of an allegation made about the manner in which the officer has performed his or her duties as an officer, or where the performance of the officer’s duties provided raw material that was intermingled with other material to produce a defamatory statement. In that case, for the reasons given earlier, the circumstances of the making of the defamatory statement do not themselves give rise to a Liability within the meaning of Clause 1.1.
When Mr Whitlam incurred the costs of the defamation actions, he was seeking to redress consequences of actions he had taken as an officer, but in incurring those costs, he was not, then and there, acting as an officer. In these circumstances, when Mr Whitlam incurred legal costs in connection with the defamation action, his commencement of those defamation actions was not part of his duties as an officer of NRMA. Nor, when he had specifically asked whether NRMA would meet any costs he incurred concerning the defamation action, and was told that NRMA would not meet those costs, could he have been of the impression that NRMA regarded itself as liable to pay for the costs of that litigation. In those circumstances, the incurring of the costs was not in his role as an officer of NRMA.
Thus, the preferable construction of the indemnity is that the costs do not fall within it by reason of the second way in which Mr Whitlam puts his case. However, if I were wrong in taking that view, there would be at least an ambiguity about whether his conduct in incurring liability for those costs was something done “as an officer”. Andar Transport Pty Ltd v Brambles Ltd has the effect that that ambiguity would be resolved in a way unfavourable to Mr Whitlam.
For these reasons, the second way in which Mr Whitlam puts his claim fails.
Indemnity Under the General Law
Alternatively, Mr Whitlam claims to be entitled under the general law to an indemnity for his costs.
Mr Gleeson submits that there is a general principle of law that a person acting on behalf of another is entitled to be indemnified for loss that they may suffer as a result of so acting.
In Sheffield Corporation v Barclay [1905] AC 392 at 397 Earl of Halsbury LC approved a statement that:
“It is a general principle of law when an act is done by one person at the request of another which act is not in itself manifestly tortious to the knowledge of the person doing it, and such act turns out to be injurious to the right of a third party, the person doing it is entitled to an indemnity from him who requested that it should be done.”
That principle has been approved in the High Court, in The Crown v Henrickson & Knutson (1911) 13 CLR 473 at 480-481 per Griffiths CJ, at 484 per Barton J, and at 488 per O’Connor J.
As so expressed, that principle does not assist Mr Whitlam. What he did at the request of NRMA, relevantly for present purposes, was to give the interview. His giving the interview did not turn out to be injurious to the rights of a third party – rather, as the interview was used, it turned out to be injurious to his own rights. Further, the principle in Sheffield Corporation concerns an act done at the request of another, the doing of which act constitutes the doing of an act that imposes liability on the person who does that act. Mr Whitlam’s giving the interview at the request of NRMA did not, in itself, result in him incurring a liability to anyone.
Mr Gleeson also points to the fact that Bowstead & Reynolds On Agency, 17th edition, article 64 (at 273) state a rule that:
“Every agent has a right against his principal to be reimbursed all expenses and to be indemnified against all losses and liabilities incurred by him in the execution of his authority.”
That formulation suffers from the same semantic ambiguity as does the definition of “Liability” in the 2002 Deed, concerning the intended scope of the expression “all losses”. None of the examples that Bowstead & Reynolds quote as illustrative of the principle is analogous to the present situation, where Mr Whitlam’s contention is that his giving the interview at the request of NRMA resulted in him suffering the type of damage that is remediable in an action for defamation.
Famatina Development Corporation Ltd [1914] 2 Ch 271 concerned an employee who was engaged to make a report for the company that engaged him. When that report was presented, and orally elaborated on to the board, a company director who was unfavourably commented on in the report sued the employee for libel and slander. That action did not succeed, but the employee incurred costs in defending it. He was held entitled to recover those costs from the company, upon the basis, expressed by Lord Cozens-Hardy MR at 282, that,
“an agent had a right against his principal, founded upon an implied contract, to be indemnified against losses and liabilities, and to be reimbursed all expenses incurred by him in the execution of his authority.”
That case is, it seems to me, merely an example of the principle stated in Sheffield Corporation v Barclay.

There are some circumstances in which an officer-holder in a corporation is entitled to an indemnity for his expenses in commencing and running litigation. For example, in Talbot v NRMA Limited (2000) 50 NSWLR 300 Hodgson CJ in Eq at 305, [20] stated:
“A director as an agent and fiduciary is entitled to be indemnified against losses and expenses properly incurred in the due performance of the office: Young v Naval, Military & Civil Service Co-operative Society of South Africa Ltd [1905] 1 KB 687 at 693. The position of directors is not dissimilar from that of trustees, as set out in R P Meagher and W M C Gummow, Jacobs, Law of Trusts in Australia, 5th ed (1986) Butterworths, Sydney, pars 2105, 2107, 2109.”
He continued, at 306, [25], that if the director had considered various relevant factors and:
“…the director believes that it would be in the interests of the company that the company be subject to litigation, and that he or she would be in breach of his or her own duties as a director if the proceedings were not taken, and if those beliefs are both honest and reasonable, then it seems to me that the bringing of the proceedings should be regarded as due performance of the director's office, so that the director would be entitled to expenses and an indemnity from the company.”
It will be seen, however, that that statement of principle is dependent upon the bringing of the proceedings against the company being part of the due performance of the director’s office. In the present case, it was no part of Mr Whitlam’s performance of his office to bring the defamation proceedings.
Mr Gleeson submits that, while the case law so far has all been concerned with a situation where an indemnity applies to a legal liability incurred to a third person, or to an action taken in the actual performance of an office, there are “no reasons to think that the operation of the general principle should be limited to that narrow class of loss”.
In my view, there are good reasons of principle why the right of indemnity does not extend as far as Mr Gleeson submits it should. If the general principle stated by Bowstead & Reynolds were applied so that “losses” included losses of types that can be compensable by an action in tort at the suit of the person who suffered the loss, the civil law would be very different to what it in fact is. If, for instance, “losses” included the type of damage that is remediable by an action seeking damages for personal injury, the mere fact that A had requested B to do a task, and B was injured in the course of performing it, would mean that B was entitled to be indemnified by A for the injury he had suffered. Any such entitlement would sweep aside those aspects of the law of tort that require there to have been a recognised tort committed by A before B is entitled to be compensated by A for his injury. It would mean that, in the paradigm case in which worker’s compensation payments are made, where a worker in the course of carrying out his duties is injured, the worker would have had a right of indemnity under the general law from his employer just because the employer had requested him to do the task in the course of which he was injured, quite independently of any obligation created by the workers’ compensation legislation, and the indemnity would be to provide a full indemnity, not merely the limited scale of benefits conferred by workers’ compensation legislation. I do not believe that a general principle of law that alters the civil law in such radical ways, exists but has hitherto gone unrecognised.
NRMA submits that no general law right of indemnity exists in the present case because, as Bowstead & Reynolds say at para 7-058:
“Where the agency agreement is contractual, the agreement to reimburse and indemnify, if not express, can be regarded as an implied term of the contract that operates unless clearly excluded.”
NRMA submits that the implied term for indemnity cannot exist when there is an express indemnity. I would not accept that the correct principle is as wide as that. Rather, there is a requirement that an implied term must not contradict any express term of the contract: BP Refinery (Westernport) Pty Ltd v Hastings Shire Council (1977) 180 CLR 266 at 283; Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 at 347; applied in Royal Botanic Gardens and Domain Trust v South Sydney City Council (2002) 76 ALJR 436 at 445, [38]; (2002) 120 LGERA 335; (2002) 186 ALR 289; [2002] HCA 5. The mere fact that an indemnity is expressly conferred by Clause 1.1 of the deed is not decisive against a more extensive indemnity being implied, if that more extensive indemnity otherwise meets the tests for implication.
The “entire agreement” provision in Clause 6.6 is not an agreement that there are no implied terms in the deed: Hart v MacDonald (1910) 10 CLR 417 at 421 per Griffiths CJ, 427 per O’Connor J, 430 per Isaacs J. If the indemnity is one that is implied in the contract between NRMA and Mr Whitlam as a matter of fact, it must meet the following tests.
“(1)it must be reasonable and equitable;
(2)it must be necessary to give business efficacy to the contract, so that no term will be implied if the contract is effective without it;
(3)it must be so obvious that “it goes without saying”;
(4)it must be capable of clear expression;
(5)it must not contradict any express term of the contract.”
BP Refinery (Westernport) Pty Ltd v Hastings Shire Council (1977) 180 CLR 266 at 283; Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 at 347.”
Without going through all those tests, the implied term for which Mr Whitlam contends fails the third of these test. I accept that, if a person in Mr Whitlam’s position were to say to his employer “if I am defamed or in some other way injured in the course of carrying out your business, I would want to be indemnified for any loss that I suffer”, and that any such claim could be within the ambit of a negotiations between reasonable people. Likewise, for an employer to in effect say “I would not agree to give you that indemnity, because I don’t know what it would cost me, and in any event in the circumstances where you were asking for an indemnity you would often have the right to sue the person who was really responsible for your injury” would be the sort of response that could be given in a negotiation between reasonable people. The outcome of that negotiation is not so obvious that it goes without saying.
Another form of implied term is the type of term which is a legal incident of a particular class of contract: Liverpool City Council v Irwin [1977] AC 239; Codelfa at 345-6; Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 448-452 per McHugh and Gummow J; Brambles Holdings Ltd v Bathurst City Council (2001) 53 NSWLR 153 at 164. It is that type of implied term that I have already considered at paras [84]-[94] above, and rejected as applicable.
The other types of implication that are possible – implications contained in the express words of the contract, and implications from usage (as happens, for example, with mercantile contracts) – are not the type of implication that is contended for here, and are obviously inapplicable.
In my view Mr Whitlam is not entitled under the general law to an indemnity for his costs.
Orders
I propose that the appeal be dealt with by making the following orders.
1.            Appeal allowed.
2.Set aside the declarations and orders made on 1 September 2006 in proceedings 50185 of 2004 in the Equity Division, Commercial List of the Supreme Court.
3.Order that proceedings 50185 of 2004 in the Equity Division, Commercial List of the Supreme Court be dismissed.
4.Respondent to pay the costs of the appeal and of the hearing in the court below.
5.            Respondent to have a certificate under the Suitors Fund Act 1951.
6.            Cross appeal dismissed.
Confidentiality Order
In the course of the hearing of the appeal a question arose concerning what, if any, restriction should be imposed on the use or disclosure of the deed by which Mr Whitlam and Channel Nine settled their defamation litigation. It was relevant for the court to have evidence that the proceedings had settled, because the fact that there had been a settlement would (regardless of the view that the court arrived at concerning the merits of the appeal) mean that orders of the trial judge that had been made in circumstances where the defamation litigation was commenced but not disposed of would need modification. The fact that the proceedings settled also made redundant the cross-appeal that Mr Whitlam had filed.
The deed that embodied the settlement agreement between Channel Nine and Mr Whitlam contained the following clause:
“4           Confidentiality
4.1Subject to clauses 4.2 and 4.3 of this Deed, the contents of this deed are confidential and each party to this deed must not disclose them to any person, and must take all necessary steps to prevent such disclosure, except:
(a)to another party to this deed or the party’s legal adviser;
(b)          by Nine to each of the Nine Parties;
(c)          as required by law;
(d)with the prior written consent of each other party to this deed;
(e)          for the purpose contemplated in clause 2.3; or
(f)the disclosure of the contents of the Agreed Statement.
4.2         The Plaintiff agrees that:
(a)neither he nor his legal advisors will discuss this Deed in open Court.
(b)he or his legal advisors will request that the Court not refer to the contents of this Deed in open Court nor in any judgment the Court may hand down in the NRMA Proceedings.
4.3          The Plaintiff shall be permitted to:
(a)disclose the contents of this Deed to Michael Woods at NRMA and its legal advisers provided he first obtains a written undertaking from NRMA and its legal advisers that:
(i)they agree that the contents of this Deed will not be discussed by them in open Court;
(ii)they will inform the court of this undertaking as to confidentiality and request that the Court will not refer to the contents of this Deed in open Court nor in any judgment the Court may hand down in the NRMA Proceedings;
(iii)they will only use the contents of this Deed for the sole purpose of, and only to the extent necessary, for the NRMA Proceedings;
(iv)they will not disclose this Deed or any part of this Deed to any person or entity; and
(v)they will consent to the Court making orders to protect the confidentiality of this Deed consistent with the terms of clause 4.1 of this Deed;
(b)disclose the contents of this Deed in the NRMA Proceedings provided on condition that he first obtains orders from the Court protecting the confidentiality of this Deed consistent with the terms of clause 4.1.”
In the language of the Deed, the “Nine Parties” were various people connected with Channel Nine, including people whose connection related to the television broadcast in question. The “Agreed Statement” was a statement, the text of which was set out in the Deed, that set out the terms in which the parties to the Deed agreed they would make public disclosure relating to the Deed. The text of the Agreed Statement was:
“The proceedings between the parties have been settled. The terms of the settlement are confidential.”
The “NRMA Proceedings” was defined as meaning the Supreme Court proceedings from which this present appeal is brought, and these present appeal proceedings.
One of the terms of the Settlement Agreement was that Mr Whitlam would file in the District Court proceedings a Notice of Discontinuance in the following terms:
“1 The Plaintiff discontinues these proceedings.
2Each party on whom the originating process has been served and each party who has been joined in the proceedings consents to the discontinuance.
3 No order as to costs.”
Another term of the Settlement Deed was for each party to the District Court proceedings to consent to the filing of a Notice of Discontinuance in those terms. The “purpose contemplated in Clause 2.3” is the filing of the Notice of Discontinuance.
When the terms of settlement were being negotiated, Mr Whitlam’s solicitors disclosed the terms being discussed from time to time to NRMA’s solicitors, on the basis of an express undertaking that both NRMA and those solicitors would not disclose the contents, and would use the contents only for the purpose of deciding whether to give a consent under Clause 2.4 of the Deed. Once the Settlement Deed was executed, Mr Whitlam’s solicitors offered to disclose it to NRMA upon receipt of a written undertaking, in a form drafted by Channel Nine, that embodied, with appropriate grammatical changes, the five undertakings set out in Clause 4.3(a)(i)-(v) of the Settlement Deed. NRMA was provided with a copy of that Deed when the undertakings were given.
A day or two before the appeal was listed, members of the Bench were provided with a written submission by Mr Whitlam’s counsel that disclosed that a confidential settlement of the defamation proceedings had been arrived at, that Mr Whitlam, with the consent of NRMA, proposed to adduce evidence of that settlement in the appeal, and that the fact that the settlement had been reached had certain consequences for the appeal, including that some issues raised by the cross-appeal were rendered moot. The evidence relating to the settlement was not filed, nor was it made available to members of the Bench on an informal basis for pre-reading.
When the hearing of the appeal began, Mr Gleeson SC requested the Court to make the following orders:
“1The Court be closed to all but the legal representatives of the parties for argument concerning the confidential exhibits to the affidavit of Timothy Randolph Price sworn 27 February 2007 (Confidential Exhibits) and any issues arising from those exhibits.
2The Confidential Exhibits be marked confidential, and not to be disclosed to any person without the leave of a judge of this Court, other than those persons referred to in Order 1 above.
3 The legal representatives of the Appellant shall:
3.1not disclose or discuss the contents of the Confidential Exhibits in open Court;
3.2only use the contents of the Confidential Exhibits for the sole purpose, and only to the extent necessary, for these proceedings or Supreme Court proceedings number 50185 of 2004;
3.3not disclose the contents of the Confidential Exhibits to any other person or entity.”
The Confidential Exhibits were the Settlement Deed, and correspondence between solicitors in the course of its negotiation.
The members of the Bench retired to consider whether the orders requested by Mr Gleeson would be made. The order the Court made, following that retirement, was:
“1.The Confidential Exhibits be marked “Confidential”, and be marked, “not to be disclosed to any person without the leave of a judge of this Court, other than the parties’ legal representatives.”
2. The legal representatives of the appellant shall:
(i)only use the contents of the Confidential Exhibits for the sole purpose, and only to the extent necessary, for these proceedings, or Supreme Court proceedings 50185 of 2004.
(ii)not disclose the contents of the Confidential Exhibits to any other person or entity
without the leave of a Judge of this Court.”
The proper construction of the first order the Court made is that it relates to the manner in which the Court’s copy of the Confidential Exhibits is kept, and who can inspect them.
The rationale for refusing the first order that Mr Gleeson sought was that the Court saw no reason, even on an “until further order” basis, to require the Court to be closed, as it was perfectly possible for counsel to refer to the Deed in terms that did not disclose any aspects that were commercially sensitive. The rationale for refusing order 3.1 sought by Mr Gleeson was that it was not clear what would be involved in “discussing” the contents of the exhibits in open court, and it was at least arguable that an order in those terms might prohibit even the mention of the fact that there had been a settlement – a matter that, in light of the contents of the Agreed Statement, was not intended to be confidential.
Both parties were invited to make submissions about whether it was appropriate to maintain the orders that had been made concerning the Confidential Exhibits. A solicitor for Channel Nine attended court during the appeal, and was heard, and invited to make written submissions within 7 days on the topic of whether the orders should be maintained. NRMA made no submissions on that topic. Mr Whitlam submitted that the orders should be maintained. Channel Nine did not avail itself of the opportunity to make written submissions.
It is a fundamental principle that the administration of justice takes place in open court: John Fairfax & Sons Limited v Police Tribunal of NSW (1986) 5 NSWLR 465. That rule is not invariable, but it is departed from only for powerful reasons. The Court’s protective jurisdiction concerning children and the mentally impaired is frequently exercised in closed court –but the Court’s jurisdiction in such cases is not solely, and is sometimes not at all, one involving the more usual role of a court of deciding issues disputed between people with no impairment of legal capacity (cf Scott v Scott [1913] AC 417 at 437. Another departure from the usual rule relates to litigation seeking to protect the confidentiality of confidential information, when there is a threat to that confidentiality – concerning that sort of litigation, justice could not be achieved if it was on terms of destroying the subject matter of the litigation (Scott v Scott ibid, p 451). The present is not such a case, because everyone that has had access to the Settlement Deed, apart from the Court, is bound by an undertaking of confidentiality concerning it, and there is no threat by anyone to breach that confidentiality.
The present case involves how the Court should deal with information that is confidential, where one of the people entitled to the benefit of the obligation of confidence is not a party to the litigation. It is common enough for confidential documents to be obtained on subpoena from a non-party. The court’s practice in dealing with such confidential documents can provide a guide to the sort of orders it should make concerning the confidentiality of the Confidential Exhibits.
Whenever any documents are obtained on subpoena from a non-party, the three steps identified by Moffit P in National Employers’ Mutual General Association Ltd v Waind & Hill (1978) 1 NSWLR 372 at 381 are involved in obtaining and later using the documents:
“The first is obeying the subpoena, by the witness bringing the documents to the court and handing them to the judge. This step involves the determination of any objections of the witness to the subpoena, or to the production of the documents to the court pursuant to the subpoena. The second step is the decision of the judge concerning the preliminary use of the documents, which includes whether or not permission should be given to a party or parties to inspect the documents. The third step is the admission into evidence of the document in whole or in part; or the use of it in the process of evidence being put before the court by cross-examination or otherwise. It is the third step which alone provides material upon which ultimate decision in the case rests. In these three steps the stranger and the parties have different rights, and the function of the judge differs.”
When one gets to the second step in this process, Moffit P said, at 383:
“At this point documents are in the control of the court, pursuant to the valid order of the subpoena. As pointed out in Small's case ((1938) 38 S.R. (N.S.W.) 564, at p. 574; 55 W.N. 215) at this time the witness may state he objects to their being handed to the parties for inspection. If he states he does not object to the parties inspecting the documents, or by lack of objection is taken to have no objection, no doubt normally there would be little reason not to permit inspection by either party. However, the documents are under the control of the judge and, even if the witness has not objected, there may be good reason in the elucidation of the truth why the judge may e.g. defer inspection by one party or the other. Indeed, no doubt, he will normally defer inspection by a party who has not issued a subpoena until his opponent has an opportunity to use the documents in cross-examination. There may be good reason why he may, or indeed should, refuse inspection of irrelevant material of a private nature, concerning a party to the litigation, or, concerning some other person who is neither a party nor the witness. It may well be that the documents are the property of some institution, but relate to private matters concerning some person and the officers of the institution do not take objection on the basis that the responsibility for disclosure rests with the court. The documents are in its control and are used on its responsibility so far as properly required for the purpose of the proceedings.” (emphasis added)

If objection is taken to the documents being inspected, on the ground of confidentiality, and there is a prima facie basis for that objection, it is for the person seeking access to make out a case that access should be granted. In deciding whether to grant access, the Court takes into account both the inherent degree of confidentiality of the documents, and also the importance of the role that they might play in the proceedings.
If legitimate objection is taken to inspection of the documents, on the ground that they are confidential, an expedient frequently adopted is to permit inspection by legal advisors on the basis that the contents of the documents are not to be disclosed by them, and are to be used only for the purpose of the proceedings. That permits the hearing to advance, with the confidentiality impinged on only to the minimum extent necessary to enable the hearing to proceed. If in the course of a hearing a question arises of whether such a document that has been permitted to be inspected by legal advisers on confidential terms should be tendered, or should be used in cross-examination of a witness, the court decides at that stage whether any, and if so what, restrictions are imposed on the manner in which the oral evidence is taken, or the access that is granted to the exhibit.
In relation to those confidential documents that fit within a recognised category of privilege (other than the special “protected confidential relationships” privilege) the law has already made a judgment that the documents fall within a class whose confidentiality is such that the administration of justice must proceed without them: Waterford v The Commonwealth (1987) 163 CLR 54 at 64-65; Carter v Northmore Hale Davy & Leake (1995) 183 CLR 121 at 128, 133-135; Commissioner of Australian Federal Police v Propend Finance Pty Limited (1997) 188 CLR 501 at 511, 563. In relation to the category of protected confidences established by section 126A-126E Evidence Act 1995, the Court is required, by section 126B, to form a view, at the time such a confidence is sought to be adduced in evidence, about whether it is more important that the confidence be protected than that the evidence be available. The need to form that view at the time of tender of the evidence can influence a judge’s decision about whether at any earlier stage to permit inspection of such a document, and if so on what terms: Urquhart v Lanham [2003] NSWSC 109.
For confidential information that is not privileged, and not within section 126A-126E, the usual approach of the Court is that, to the extent to which the confidential information is relevant to the conduct of the proceeding, it is more important that it be used in the administration of justice than that the confidence be protected. It is, of course, a matter for the discretion of the trial judge whether to follow that usual course in any particular case that is before him or her. Following that usual course, however, involves deciding what is the extent to which it is necessary for the confidence to be overridden to enable justice to be properly administered, and seen to be properly administered. It may be, in the circumstances of a particular case, that that objective is achieved by having those clauses or pages of a document that are relevant to the decision of the case admitted as an open exhibit, and the balance of the document admitted as a confidential exhibit.
If it were the case that Clause 4 of the Deed, on its proper construction, prevented Mr Whitlam from tendering the Deed in evidence, unless the Court agreed to conditions more restrictive of its use than those that the Court in its own judgment saw fit to impose, a question would arise of whether the clause was, to that extent, unenforceable as being contrary to public policy. However, the solicitor for Channel Nine has informed the Court that Channel Nine does not take the attitude that a disclosure to the Court involved any breach of the clause. Thus, that question does not arise.
In the present case, those terms of the Settlement Deed that are relevant to the litigation have been identified in the course of this judgment. As well, there are some provisions of the Deed that are in the nature of mechanical provisions concerning which confidentiality could not possibly exist. What might be called the "commercial bottom line" of the settlement – namely, whether any money changed hands and if so how much, and whether any contractual obligations other than relating to the implementation of the settlement itself were entered and if so in what terms – is not relevant to the disposition of these proceedings. Those matters would be disclosed if there were to be unrestricted access to the Settlement Deed, and the solicitors’ correspondence concerning its negotiation.
The appropriate way, in my view, of preserving the confidentiality of the Settlement Agreement, to the extent that is consistent with the proper administration of justice in the present case, is by making an order in the following terms:
1.Direct the solicitors for the appellant to prepare and file, within seven (7) days of the date of this order, a redacted version of the Deed of Release that is Confidential Exhibit ‘TRP 17’ to the affidavit of Timothy Randolph Price sworn 27 February 2007, that does not include Clause 2.1 (including its heading), Clause 2.2 and Clause 7 (including its heading).
2.That that redacted copy of the Deed, when filed, become an exhibit in the appeal.
3.That the orders made 28 February 2007 be varied by inserting at the beginning of Clause 2 the words “save to the extent disclosed in any other exhibit filed in these proceedings”.
HANDLEY AJA: I agree with Campbell JA.
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Addendum
THE COURT: One of the topics in this judgment relates to what, if any, restriction should be imposed on the use or disclosure of the Deed by which Mr Whitlam and Channel Nine had settled their defamation litigation. At [115] Campbell JA said: “Channel Nine did not avail itself of the opportunity to make written submissions.”
Since the judgment was delivered, a representative of Channel Nine has pointed out that that statement is incorrect. Investigation now reveals that Channel Nine lodged written submissions at the Court, but, through an administrative oversight within the Court, those submissions were not distributed to the Judges comprising the Bench.
We have now had the opportunity to consider those submissions. They comprised two pages, and argued to the same conclusion that the written submissions of Mr Whitlam on this topic had argued, namely that the orders that the Court had made at the time of the hearing, set out in para [110] of the reasons for judgment, should not be altered.
In essence, the written submissions of Channel Nine made the following points.
1.Channel Nine was bound by a contractual obligation to seek to protect the confidentiality of the Settlement Deed.
2.There is an important public interest in encouraging litigants to settle their disputes, and confidence that the terms of a settlement will be kept confidential is an encouragement to settle.
3.The importance of confidentiality clauses is illustrated by the fact that there is a jurisdiction to restrain, by injunction, a party to a contract who threatens to breach a confidentiality clause in that contract.
4.NRMA is not party to the Settlement Deed and “Channel Nine understands” that the Appellant and its legal advisers have not given an undertaking of the type referred to in Clause 4.3 of the Settlement Deed.
Of these points, the first was manifest from the terms of the Settlement Deed itself, and was also pointed out in the written submissions of Mr Whitlam. The second was a point made, at greater length, in the written submissions of Mr Whitlam. The third, though obviously correct, and well known, does not bear upon where a line should be drawn between the private interests of people in keeping material confidential, and the public interest in the open administration of justice.
The fourth is a little more complex. There was evidence before the Court of such an undertaking being requested, statements by counsel for Mr Whitlam that NRMA had had access to the Settlement Deed and was in the circle of confidentiality, and no contesting of those statements by counsel for NRMA. On that basis the Court inferred that the undertakings had been given. Even if it were to be the case that the drawing of that inference was incorrect, and that while the commercially significant elements of the settlement had been disclosed to NRMA in confidence, the actual Settlement Deed was not handed over until the Court made its orders, those orders still protect the interests of Channel Nine to the extent consistent with open administration of justice.
In these circumstances, the belated discovery of Channel Nine’s submissions gives no cause to doubt the correctness of the orders made on 11 April 2007 for the purposes of protecting, to the extent consistent with the principle that justice is usually administered in the open, Channel Nine’s legitimate interests in protecting confidentiality. It is, however, appropriate to publish this statement to correct the error in the final sentence of para [115] of the earlier reasons.
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AMENDMENTS:

19/04/2007 - Addendum added - Paragraph(s) 128-134

LAST UPDATED: 19 April 2007