Poniatowska v Channel Seven Sydney Pty Ltd

[2019] SASCFC 111

SUPREME COURT OF SOUTH AUSTRALIA

(Full Court)

PONIATOWSKA v CHANNEL SEVEN SYDNEY PTY LTD

[2019] SASCFC 111

Judgment of The Full Court

(The Honourable Chief Justice Kourakis, The Honourable Justice Blue and The Honourable Justice Nicholson)

27 September 2019

DEFAMATION - JUSTIFICATION - GENERALLY

DEFAMATION - FAIR COMMENT - IN GENERAL - COMMENT AT COMMON LAW

DEFAMATION - PRIVILEGE - QUALIFIED PRIVILEGE

APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - INTERFERENCE WITH JUDGE'S FINDINGS OF FACT

APPEAL AND NEW TRIAL - PROCEDURE - SOUTH AUSTRALIA - POWERS OF COURT - FURTHER EVIDENCE

In October 2011 the respondents broadcast a story on Today Tonight which depicted the appellant as having defrauded and cheated Centrelink of $20,000 in single parent benefits while working for a building company and having avoided prosecution by finding a loophole in social security law that did not require her to disclose her income to Centrelink. The story was also published on the Channel Seven website.

The appellant had been charged in April 2008 with what became 17 counts of obtaining a financial advantage by omission between August 2005 and May 2007, in contravention of section 135.2(1) of the Criminal Code (Cth). Between February 2005 and February 2006 the appellant was employed by a building company, the Hickinbotham Group. She was remunerated exclusively on a commission basis for the sale of house and land packages which proceeded to the footings stage and received commission payments up to more than a year after entry into package contracts.

The appellant foreshadowed a plea of not guilty to the charges and the matter was listed for trial in the Magistrates Court for July 2009. On the eve of trial the appellant accepted legal advice to plead guilty and she pleaded guilty on the morning of trial. Ultimately she appealed to this Court against her conviction and her appeal was upheld. An appeal to the High Court by the Commonwealth Director of Public Prosecutions was dismissed on the morning of the day on which the Today Tonight story was broadcast.

This Court (and the High Court) held that the appellant could not be guilty of obtaining a financial advantage by omission because section 135.2(1) did not impose a duty to disclose and the prosecution did not contend that any other Commonwealth law required her to disclose her income to Centrelink. This Court held that in addition the charges were misconceived because each count related to a payment made by the Hickinbotham Group to the appellant rather than to a benefit paid by Centrelink to her.

The appellant sued the respondents in the Supreme Court for defamation, claiming that the story depicted her as a welfare fraud and cheat. The respondents relied on defences of justification, fair report, qualified privilege, extended qualified privilege and fair comment. The trial Judge upheld each defence and dismissed the action.

The appellant appeals against the dismissal, contending that the Judge ought to have found additional imputations and made numerous errors in concluding that each defence was established. She also seeks to adduce new evidence on appeal being copies of four Centrelink letters. She also contends that, because the Judge had previously worked for the Department of Social Security, he ought to have disqualified himself from hearing the matter.

Held by Blue J (Kourakis CJ and Nicholson J agreeing):

1. The Judge was correct to find that the additional imputations pleaded by the appellant did not arise (at [334]).

2. The Judge made several errors in concluding that the justification defence was established, including:

(a) the manner in which the Judge used the appellant’s guilty pleas as an admission that she was guilty of each element of the offences except one (at [369], [382], [385], [389]-[390]);

(b) the Judge not making findings on each of the five elements of notional section 135.2 offences (at [402], [409], [412]-[415]);

(c) the Judge’s not making a finding that the appellant understood that she was obliged to report to Centrelink any changes in commission income, knew the income threshold above which her parenting payments would be affected (and in particular that it was much lower than for family tax benefit), knew that she was not entitled to the parenting payments she received, or read and understood the Centrelink letters dated 7 April and 5 September 2005 which the Judge found she received (at [392], [411]-[415], [464]-[469], [474]);

(d) the Judge's failure to take into account the impact of the absence of a complete set of documents from Centrelink or any testimonial evidence from Centrelink on the discharge by the respondents of the onus of proof (at [421]-[423], [435]-[446]);

(e) the Judge's erroneous assessment of Ms Poniatowska's attitude to Centrelink officers giving evidence (at [440]-[444]);

(f) the Judge's failure to have regard to what the Centrelink documents that were tendered proved or did not prove (at [447]-[472]);

(g) the Judge's failure to consider whether Ms Poniatowska may have misunderstood what she was told by Centrelink officers or the regime for parenting payment (at [454]-[460], [506]-[507], [522]);

(h) the Judge's approach to the discharge of the onus of proof (at [402], [474]-[477], [521]-[522]);

(i) the Judge's adopting an inconsistent approach in finding fraud not proved in relation to income earned by the appellant from AV Jennings or earned from the Hickinbotham Group after August 2006 but finding fraud proved in relation to income earned from the Hickinbotham Group before August 2006 (at [488]-[491]); 

(j) the Judge's failure to take into account the absence of any evidence from the solicitor who acted for the appellant in the prosecution and erroneously drawing an adverse inference against the appellant because she did not call him to give evidence (at [500]-[503]); and

(k) the Judge's manner of rejecting the appellant’s evidence about her beliefs (at [505]-[518]).

3. These errors vitiated the Judge’s conclusion that the respondents had proved that the appellant was guilty of fraud. On a review of all of the evidence adduced at trial, the respondents failed to prove fraud and the defence of justification was not established (at [543]).

4. The defence of fair comment did not arise because the relevant imputation was a statement of fact rather than comment. In any event, the defence of fair comment was not established and the Judge erred to the extent that he held that it was (at [552]).

5. The Judge erred in finding that the defence of fair report was established (at [562]).

6. The Judge erred in finding that the defence of qualified privilege was established (at [569]).

7. The Judge erred in finding that the defence of extended or constitutional qualified privilege was established (at [573]).

8. It is unnecessary to determine the other grounds of appeal (at [342], [347], [577], [580]).

9. Appeal allowed. The parties to be heard as to who should undertake the assessment of damages (at [584]).

A New Tax System (Family Assistance) Act 1999 (Cth) ss 21, 22, 58; A New Tax System (Family Assistance) (Administration) Act 1999 (Cth) ss 5, 7, 8, 16, 20, 21, 23, 31A, 32A, 32B, 32D, 32P, 71; Criminal Code Act 1995 (Cth) Sch 1 s 135.2; Data-matching Program (Assistance and Tax) Act 1990 (Cth) ; Defamation Act 2005 (SA) ss 27, 28, 29; Freedom of Information Act 1982 (Cth); Social Security Act 1991 (Cth) ss 500, 503, 1068A; Social Security (Administration) Act 1999 (Cth) ss 67, 68, 74, 207, 208, referred to.
Blatch v Archer (1774) 98 ER 969; Brandi v Mingot (1976) 12 ALR 551; Chase v News Group Newspapers Ltd [2003] EMLR 218; Ho v Powell (2001) 51 NSWLR 572; Jones v Dunkel (1959) 101 CLR 298; R v D'Orta Ekenaike [1998] 2 VR 140; Seymour v Australian Broadcasting Commission (1977) 19 NSWLR 219; State Bank of New South Wales v Brown (2001) 38 ACSR 715, discussed.

PONIATOWSKA v CHANNEL SEVEN SYDNEY PTY LTD
[2019] SASCFC 111

1. KOURAKIS CJ:                 I would allow the appeal for the reasons given by Blue J, save for one, ultimately immaterial, difference on the inferences which may be drawn from Ms Poniatowska’s guilty plea. 

2. The imputations made by the subject publications were that Ms Poniatowska ‘cheated Centrelink’, ‘committed fraud’ and ‘was dishonest’, and ‘got away with her dishonesty and or fraudulent behaviour’. The imputations were therefore more than a general accusation or allegation of dishonesty; they alleged a contravention of the criminal law for which she had escaped conviction. The defence of justification was conducted on the basis that Ms Poniatowska received the letters of 7 April and 5 September 2005 and had dishonestly failed to report her income as she was directed to do by those letters, thereby offending against s 135.2 of the Criminal Code Act 1995 (Cth) (Criminal Code).

3. The defect in the charges laid by the Commonwealth Director of Public Prosecutions alleging a breach of s 135.2 of the Criminal Code lay in the failure to particularise the letters which obliged Ms Poniatowska to provide details of her income. On the setting aside of the convictions, Ms Poniatowska’s pleas of guilty were no longer formal and binding admissions of guilt. Of course, that did not preclude their use as evidence of an admission, but the defect in the charge precluded any reliance on Ms Poniatowska’s guilty pleas to support an inference that she received, read and understood the direction in those letters.

4. Nonetheless, it is a necessary element of the s 135.2 offence that she dishonestly received the benefits in the sense that she knew she was not eligible to receive them. Moreover, the charges expressly allege that Ms Poniatowska received parenting payments knowing or believing that she was not eligible to do so. I accept therefore that Ms Poniatowska’s guilty pleas were capable of supporting an inference in the defamation proceedings that she knew she was not entitled to the parenting payments paid to her but they were not conclusive evidence of dishonesty because the convictions were set aside.

5. I agree for the reasons given by Blue J that the Judge relied on Ms Poniatowska’s guilty pleas to conclude that she dishonestly obtained the parenting payments without considering the whole of the evidence.  The Judge erred in finding that the guilty plea and the failure to oppose the facts alleged by the prosecution was ‘sufficient to establish that Ms Poniatowska committed fraud with the conviction only being set aside because of the failure of the prosecution to establish an essential element of the offence’.[1] 

   [1]    Poniatowska v Channel Seven Sydney Pty Ltd (No 4) [2016] SASC 137 at [393].

6. I also agree for the reasons given by Blue J that, on the whole of the evidence, the inference of dishonesty should not be drawn.  I would particularly emphasise the instructions consistently given by Ms Poniatowska that she thought that she was entitled to receive parenting payments during the relevant times subject only to a reconciliation at the end of each financial year.  The difference in emphasis given at different times by Ms Poniatowska to what she believed was her annual income estimate, her occasional reporting of income and her belief concerning the special treatment of commissions is not reason enough to put to one side her consistent instructions that she believed she was entitled to the benefits.  The fact that Ms Poniatowska gave those instructions affects the strength of the inference which might otherwise arise from her guilty pleas. 

7. I also agree, for the reasons given by Blue J, about the significance of the absence of evidence from the Centrelink officer, MJ, as to the nature of her conversations with Ms Poniatowska, and other more general evidence about the practice and procedures.

8. The letters of 7 April and 5 September 2005 are far from clear.

9. The critical obligation in the letter of 7 April 2005 was expressed as follows:

   Employment: start or change jobs or become self-employed; have a change in employment income.

   (Punctuation added)

10. The difficulty with expressing the obligation in that way is that Ms Poniatowska’s commission income was necessarily subject to change from time to time.  It is not unreasonable to understand the instruction to impose an obligation to inform Centrelink only if there was a change in the underlying structure of the commission arrangements and not the fortnightly dollar amount. 

11. The letter of 5 September 2005 elaborated on Ms Poniatowska’s obligation as follows:

    Employment: start, stop, recommence or change work in any form of profession, trade business or self-employment income from employment changes (the amount earned goes up or down).

    (Punctuation added)

12. Again, however, because Ms Poniatowska was being paid by commission her income would necessarily go up and down. 

13. In that context, the respondent’s failure to call the Centrelink officer, MJ, about her conversations with Ms Poniatowska between May and September 2007 and, in particular, her decision not to impose a recovery fee weighs heavily against a finding that Ms Poniatowska knew that she was not entitled to the parenting payments in the period alleged. 

14. BLUE J:                In October 2011 the respondents Channel Seven Sydney Pty Ltd and Channel Seven Perth Pty Ltd (collectively Channel Seven) broadcast a story on Today Tonight which depicted the appellant Malgorzata Poniatowska as having defrauded and cheated Centrelink of $20,000 in benefits while working for a building company and having avoided prosecution by finding a loophole in social security law that did not require her to disclose her income to Centrelink. The story was also made available on the Channel Seven website.

15. The story was prompted by a decision by the High Court[2] earlier that day upholding a decision by this Court allowing an appeal against a conviction.[3] Ms Poniatowska had been charged with 17 counts of obtaining a financial advantage between August 2005 and May 2007 in contravention of section 135.2(1) of the Criminal Code (Cth), to which she had pleaded guilty on the day of trial. Her appeal against conviction had been upheld because section 135.2(1) did not impose a duty to disclose and the prosecution did not contend that any other Commonwealth law required her to disclose her income to Centrelink.

    [2]    Commonwealth Director of Public Prosecutions v Poniatowska [2011] HCA 43, (2011) 244 CLR 408.

    [3]    Poniatowska v Director of Public Prosecutions (Commonwealth) [2010] SASCFC 19, (2010) 107 SASR 578.

16. Ms Poniatowska instituted an action in the Supreme Court for defamation against Channel Seven, claiming that the story depicted her as a welfare fraud and cheat. Channel Seven relied on defences of justification, fair report, qualified privilege, extended qualified privilege and fair comment. The trial Judge upheld each defence[4]  and dismissed Ms Poniatowska’s action.[5] The Judge ordered that Ms Poniatowska pay Channel Seven’s costs of action on an indemnity basis.[6]

    [4] Channel Seven also pleaded the statutory honest opinion defence in conjunction with the common law fair comment defence. However the Judge did not decide the statutory honest opinion defence. This is addressed at [545] below.

    [5]    Poniatowska v Channel Seven Sydney Pty Ltd & Anor (No 4) [2016] SASC 137.

    [6]    Poniatowska v Channel Seven Sydney Pty Ltd & Anor (No 5) [2017] SASC 32.

17. Ms Poniatowska appeals against the dismissal, contending that the Judge ought to have found additional imputations and made numerous errors in concluding that each defence was established. She also seeks to adduce new evidence on appeal comprising copies of four Centrelink letters. She also contends that, because the Judge had previously worked for the Department of Social Security, the Judge ought to have disqualified himself from hearing the matter. She also appeals against the costs order.

    Background

18. Ms Poniatowska was born in Poland in 1967, married in 1989 and emigrated with her husband to Australia in 1991. Her daughter was born in 1992 and her son was born in 1995.

19. At some point Ms Poniatowska commenced to receive family tax benefit and at some point she commenced to receive child care benefit. Evidence was not adduced as to when these different payments commenced but it is likely that family tax benefit, if not also child care benefit, commenced in July 2000 when they were introduced[7] and that Ms Poniatowska was receiving a predecessor of family tax benefit, if not also child care benefit, in the 1990’s after her children were born.

    [7]    Family tax benefit: A New Tax System (Family Assistance) Act1999 (Cth): see [192] below. Child care benefit: A New Tax System (Family Assistance) Act1999 (Cth): see [192] below.

20. In January 2002 Ms Poniatowska commenced employment with radio station 5DN as an account manager selling advertising. Her remuneration was a combination of salary and commission. She was then living with her husband and two children in a house at Prospect (the Prospect house).

21. In November 2002 Ms Poniatowska’s husband left her and their children and later moved overseas.

22. In November 2002 Ms Poniatowska signed a claim form for Parenting Payment Single (parenting payment) which is normally paid fortnightly by Centrelink.  She signed further claims in April 2003 and November 2003. None of these claims were tendered at trial. Ms Poniatowska commenced receiving parenting payment in November 2002.

23. In May 2003 Ms Poniatowska leased a post office box at a post office at Prospect (the Prospect PO box). The lease was for the balance of the post office box year which always ends on 31 March (in this case 31 March 2004).

24. In August 2003 Ms Poniatowska gave to Centrelink an estimate that her annual income was $30,000. At that point she was receiving family tax benefit and parenting payment paid fortnightly if not also child care benefit (which is usually received by fee reduction rather than cash payment).[8]

    [8]    See [221] ff below.

25. In December 2003 Ms Poniatowska resigned her employment with 5DN to complete her Master of Business Administration.

26. In February 2004 Ms Poniatowska moved from Prospect to a house at Magill (the Magill house). On 31 March 2004 the Prospect PO box lease came up for renewal. Ms Poniatowska gave evidence that she did not recall renewing the lease and had no reason to do so given that she had moved to Magill. The trial Judge found based on Australia Post computer records that she had in fact renewed the lease.

27. As at January 2005 Ms Poniatowska was receiving $476[9] per fortnight parenting payment and $460 per fortnight family tax benefit. These payments were made into Ms Poniatowska’s Bank SA account (the Bank SA account).

    [9]    All dollar figures are rounded down to the nearest whole dollar unless otherwise shown.

28. On 31 January 2005 Ms Poniatowska commenced working for a company (Hickinbotham)[10] in the Hickinbotham Group selling house and land packages pursuant to a letter of appointment dated 24 January 2005, which set out the terms of her employment contract, including the following:

    ·Ms Poniatowska’s remuneration was comprised entirely of commission.

    ·The commission was $1,100 per contract or, if the contract price was greater than $113,220, two per cent of the contract price instead.

    ·The commission was to be paid in two instalments.

    ·An initial instalment of $600 was to be paid if the contract was accepted by a company director at the end of the month in which the contract was accepted (the initial instalment).

    ·A final instalment was to be paid if and after the first progress payment was received for the building works (the final instalment) [evidence was given that this was when the footings were poured].

    ·If the contract was cancelled, no commission was payable and the initial instalment was to be repaid (by cash or offset against other commissions payable).

    ·A company contract preparation fee of $200 was to be deducted from commission payable.

    [10]   Ms Poniatowska was employed by Employment Services Australia Pty Ltd but for ease of reference I refer to her employer as Hickinbotham.

1. Ms Poniatowska was to be paid a “retainer” of $500 per week [in practice $2,000 per month] for the first three months, to be repaid in cash or offset against commissions (the fixed payments).

2. As the fixed payments and initial instalments were advances against commissions that would only become payable if the contract was not cancelled (and hence proceeded to the footings stage), such payments were not remuneration but merely advances.

3. Hickinbotham’s monthly commission statements (referred to below) show that:

   ·the first initial instalment was not paid until June 2005 and the first final instalment was not paid until October 2005;

   ·there was a delay of between one and four months (typically two or three months) between a contract first appearing in a commission statement (presumably when it was executed by the purchaser) and its acceptance which triggered payment of the initial instalment;

   ·there was a delay of between two and 17 months (typically around seven months) between acceptance of the contract (triggering payment of the initial instalment) and pouring of footings (triggering payment of the final instalment);

   ·there were 35 house and land packages shown on commission statements issued during Ms Poniatowska’s employment up to the end of February 2006;

   ·there were 11 occasions when the contract was shown as cancelled after payment of the initial instalment, in which case Hickinbotham debited the amount of the initial instalment against Ms Poniatowska and offset it against commissions in respect of other contracts;[11]

   ·there was a substantial delay of between two and 13 months (typically around six months) between acceptance of the contract (triggering payment of the initial instalment) and cancellation (triggering an offset);

   ·Hickinbotham recovered the advances totalling $6,000 that had been paid in February to April 2005 by offsetting $1,807 against commissions payable in November 2005 and $4,193 against commissions payable in January 2006.

   [11]   In one case Hickinbotham overlooked actually debiting the -$600 shown as debited on the commission statement.

4. On 28 February 2005 Hickinbotham paid by direct credit into Ms Poniatowska’s Commonwealth Bank of Australia streamline account (the CBA account) $1,679 (presumably $2,000 less income tax). All payments of commission by Hickinbotham (and later by AV Jennings) were paid by direct credit into the CBA account.

5. On 10 March 2005 Centrelink wrote a letter in a standard form (Q135) to Ms Poniatowska as follows:

   Request for Information

   To help ensure customer payments are correct, we compare our records with information that the Australian Taxation Office (ATO) receives from employers. Information received from the ATO shows that you recently signed a Tax File Number Declaration Form. We need your assistance to make sure that you are receiving the correct rate of Parenting Payment Single.

   You may have already told us about this, however we need to confirm your employment details.

   Please contact [J][12] on [phone number] about this by 31 March 2005. You can reverse the charges if you live outside the local call area. We require full pay details for all employers that you are working for, from the date you started your employment. Verification of your earnings can either be in the form of payslips, or a copy of pay book signed by your employer. If you are unable to provide enough details, we may also need to contact your employer(s) to confirm them.

   If you do not contact us by 31 March 2005 your payment may be suspended.

   This is an information notice given under the social security law.

   If the information we receive shows that there should be a change to your payment we will write to you to inform you.

   [12]   I refer to the names of Centrelink officers shown in various Centrelink documents tendered at trial by initials only to preserve their privacy because it is unnecessary to disclose their full names.

6. The copy of this letter, like the other Centrelink letters tendered at trial, was a computer generated version retained by Centrelink. This letter was addressed to Ms Poniatowska at the Prospect PO box. Ms Poniatowska gave evidence that she did not receive this letter. However she gave evidence, which was not challenged in cross-examination, that she knew that Centrelink matched records with the Australian Taxation Office and that Centrelink would learn of her employment with Hickinbotham from the Australian Taxation Office.

7. As from 20 March 2005, pursuant to biannual indexing, Ms Poniatowska’s ordinary rate of parenting payment increased to $482 per fortnight and of family tax benefit increased to $462 per fortnight.

8. On 31 March 2005 Hickinbotham paid by direct credit into the CBA account $1,679 (presumably $2,000 less income tax).

9. On 4 April 2005 Centrelink sent to Hickinbotham a letter in standard form requesting information. Hickinbotham responded on 6 April saying that Ms Poniatowska earned $2,000 on 31 March 2005. In fact Hickinbotham had also paid $2,000 on 28 February 2005.

10. On 4 April 2005 Centrelink wrote a letter to Ms Poniatowska addressed to the Prospect PO box. It said that payment of her parenting payment had been suspended because it had not received a reply to the letter it had sent her. The trial Judge did not make a finding that Ms Poniatowska received this letter.

11. On 7 April 2005 Centrelink wrote a letter to Ms Poniatowska. The letter was addressed to the Prospect PO box. It said that the correct amount of Ms Poniatowska’s earnings from Hickinbotham was not taken into account in the payments made to her. It said that the declared income was $0 but actual income was $1,933. It said that she had been overpaid $73 for the period 19 January to 29 March 2005 because she had received parenting payment of $2,406 when she should have received $2,333. The trial Judge did not make a finding that Ms Poniatowska received this letter.

12. On 7 April 2005 Centrelink wrote another letter to Ms Poniatowska. The letter was addressed to the Prospect PO box. The letter referred to both parenting payment and family tax benefit without clearly distinguishing between them. A reconstruction of the letter follows:

    Your Reporting and Income Statement

    You must report every 2 weeks on the dates below. You will not be paid your Parenting Payment until you report. Report your expected earnings even if you haven’t been paid yet. You must report even if you haven’t worked.

    For this Centrelink reporting period             Report on this day

    13 April 2005 to 26 April 2005                  Tuesday 26 April 2005

    27 April 2005 to 10 May 2005                  Tuesday 10 May 2005

    11 May 2005 to 24 May 2005                  Tuesday 24 May 2005

    25 May 2005 to 7 June 2005  Tuesday 7 June 2005

    8 June 2005 to 21 June 2005  Tuesday 21 June 2005

    22 June 2005 to 5 July 2005  Tuesday 5 July 2005

    What you must report for each Centrelink reporting period:

    The ABN (Australian Business Number) or business name of your employer.

    The gross amount you earned (BEFORE tax or other deductions).

    If any circumstances have changed (see the list on the back of this page for details).

    Your Working Credits

    As at 7 April 2005         1000 Working Credits

    Important Information

    If your family income has changed from what you previously told the Family Assistance Office, please call 13 61 50 to provide a new estimate for Family Tax Benefit.

    You must report your earnings for the whole Centrelink Reporting Period, including the first and last day.

    Your Centrelink Reporting Period can be different from the period on your payslip. Use ‘Your Earnings Worksheets’ to help you record and work out how much you earned in a Centrelink Reporting Period. You can also find help in the booklet ‘Reporting your Earnings: what you need to know’. If you get paid any allowances from your work (e.g. for fuel, meals, clothing) ask Centrelink if you need to report them with your gross earnings. Most allowances are not counted as part of your income from employment.

    Make sure when you report to answer all of the questions carefully. No-one wants you to get into debt to Centrelink. If you get a debt, you’ll have to pay it back.

    This Reporting and Income Statement is an information notice given under social security law by a Commonwealth entity. You have a duty to provide Centrelink with all the information that is relevant to your payment. Giving false or misleading information is a criminal offence. Information provided by you may be checked under Centrelink’s data-matching programs.

    Please read the ‘Privacy and You’ information on the last page of this letter.

    Taxation

    Parenting Payment, like wages and salaries is part of your taxable income. If tax is not deducted from your payment, and your total income is over the tax threshold, you may have to pay tax in a lump sum at the end of the financial year. The Tax Office can tell you how much this may be. You can ask us to take tax out of your payments at any time.

    Your Rights

    If you think our decision is wrong, phone us or come and see us. We will check the facts and explain the decision. If you still do not agree, you can ask for one of our Authorised Review Officers (ARO) to look at it. The ARO is an officer who has no previous involvement in your case, and if the decision is wrong, the ARO can correct it. The ARO can also tell you how you can appeal to the Social Security Appeals Tribunal (SSAT) if you still do not agree. Both the ARO review and SSAT appeal are free. Remember, if you do not ask for the decision to be reviewed within 13 weeks of being told about it, you may only get back payment from the date you ask. If you wish to comment on the quality of service you received from us you can talk to our Customer Relations staff on Freecall 1800 050 004. If you have contacted our Customer Relations staff with a concern and they have not been able to resolve it to your satisfaction, you can take the matter further by contacting the Ombudsman’s office whose toll free “1300” number is listed in your phone book. If you have a hearing or speech difficulty you can contact the Customer Relations unit using a Teletypewriter (TTY) phone on 1800 000 567.

    Privacy and You

    Personal information is protected by law. The authority to collect this information is contained in social security law. The information you provide in response to this letter will be used to decide correct payments and suitability for services for you and, where relevant, third parties (for example, other family members). Certain information may be used to detect or prevent fraud. Centrelink may disclose limited information (for example income and assets) about you to other parties when your circumstances affect their entitlement to payment and services. Limited personal information may be used to conduct customer surveys run by Centrelink, its client departments or by research organisations on their behalf (see the factsheet ‘Customer Research and You). Centrelink can give your information to someone else in special circumstances where Commonwealth legislation allows or requires or where you give permission. For example, Centrelink usually gives some or all of your information about income and taxation matters to the Australian Taxation Office. You can get more information from the fact sheet called ‘Your Right to Privacy’.

    (Punctuation added)

13. The back of the first page of the letter contained a list of “Changes you must tell Centrelink about” as follows:

    Changes you must tell Centrelink about

    You must tell us if you have or are likely to have any of the following changes in circumstances. You must tell us about any changes on your reporting day immediately following the change (your reporting days are on the front page of this letter).

    Employment: start or change jobs or become self-employed; have a change in employment income.

    Accommodation, Rent and Bank details: change residential or postal address; have a change in your rent details/amount; start or stop sharing accommodation; sell your house or buy other home; change or close the account we send your payments to.

    Income, Assets and Investments: financial investments change by more than $1000; get money from a superannuation or rollover fund; get any leave entitlement; investments; become involved or change involvement in a business, company or trust; assets change substantially; gift assets or sell them for less than their value; get any money from ANY other source.

    Compensation: if you (or your partner) receive compensation payments you must tell us within 7 days.

    Relationships and Children: marry, separate, become widowed, get back with former partner or live with a new partner; have a change in the number of children in your care or start sharing the care of a child; if sharing the care of a child, the amount of time the child spends with you changes; start to get child support/maintenance or the amount you get changes.

    Other: (if you or a dependent family member) plan to leave Australia (including holidays); have a change in visa status; are imprisoned (e.g. gaol, police detention, weekend detention, psychiatric confinement).

    What is Income?

    Income has a very broad meaning for social security purposes. Some examples of income are earnings from employment (including fringe benefits), business income (including farms), income from rental properties, deemed income from financial investments, income from superannuation pensions and other income streams, income paid from overseas including pensions and most compensation payments. If you have a partner, that person’s income may affect your payment.

    What are Assets?

    Assets include the value of goods, cars, boats, furniture, money, investments, real estate, personal property, any interest in any property, any debt owing to you and any other right or interest. Assets do not include the value of the home in which you live or special aids for people with disabilities.

    (Punctuation added)

14. The trial Judge found that Ms Poniatowska received this letter.

15. On 22 April 2005 a Centrelink customer service officer created a record. The record, like all other records tendered at trial, appears to have been a record of one of several “screens” used by Centrelink. The record indicated that Ms Poniatowska attended at the Centrelink office at Enfield. It recorded the following information about the visit:

    Sum:  CUS EAN PPS  Ext Detail: res pps from dlp+1

    Txt:          Customer contacted ENFIELD on 22 APR 2005 regarding Change in Earnings Details for Parenting Payment Single. Information was obtained via Interview using Personal – In Office. Document created by [redacted] on 22 APR 2015.

    cus was sus frc by slb review re q 135

    cus attended enf csc called slb and advised res pps

    earnings for the period 30/3/05 to 12/4/05 gross $700

    as per s85 & s1068 SSA

16. No evidence was adduced from Centrelink to explain the meaning of the abbreviations, acronyms and terminology used in the record or whether any other record or screen was made by Centrelink in respect of the discussion during the visit. It may be inferred from the record that there was a discussion about Ms Poniatowska’s parenting payment having been suspended but it cannot be inferred who raised that topic. It may be inferred that Ms Poniatowska referred to earnings during the fortnight ending 12 April 2005 of $700 but it cannot be inferred what questions were asked by the Centrelink officer or Ms Poniatowska’s responses. No evidence was adduced from Centrelink as to the conversation between Ms Poniatowska and the Centrelink officer in respect of any of the Centrelink records of conversations with Ms Poniatowska tendered at trial.

17. On 26 April 2005 a Centrelink officer created a record. It indicated that Ms Poniatowska telephoned a Centrelink officer. It recorded that Ms Poniatowska reported gross earnings from Hickinbotham of $660 for the period ended 26 April 2005.

18. On a date unknown after 28 April 2005 Hickinbotham sent to Ms Poniatowska a commission statement. The Hickinbotham commission statement showed addresses in respect of which presumably Ms Poniatowska had procured customers to sign contracts for house and land packages. This statement showed three addresses for which presumably Ms Poniatowska had procured contracts but they had not yet been accepted by Hickinbotham during the period covered by the statement shown as between 30 March and 28 April 2005. Ms Poniatowska was not entitled to payment of any commission in respect of these contracts. This statement indicated that no contracts had been procured by Ms Poniatowska during any earlier period.

19. No evidence was adduced from a Hickinbotham employee to explain the commission statements. No evidence was adduced to prove when or how they were sent to Ms Poniatowska. Ms Poniatowska in her evidence admitted receiving such statements while she was still employed at Hickinbotham but not precisely when she received them.

20. On 28 April 2005 Hickinbotham paid by direct credit into the CBA account $1,679 (presumably $2,000 less income tax).

21. In May 2005 Ms Poniatowska commenced to experience sexual harassment at work. This continued until termination of her employment in February 2006. Dr Czechowicz, who commenced to treat Dr Poniatowska in February 2007, expressed the opinion that she had suffered from an Adjustment Disorder with Mixed Anxiety and Depressed Mood and Post Traumatic Stress Disorder between May 2005 and when Dr Czechowicz gave evidence at the trial of the action in August 2014. Dr Czechowicz expressed the opinion that her Adjustment Disorder and Post Traumatic Stress Disorder were the cumulative result of the killing of her mother when she was two years old which left her vulnerable and with a tendency towards having a depressive illness at a later time, her relocation to Australia which entailed further trauma and then the sexual harassment that she experienced at Hickinbotham.

22. On 12 May 2005 a Centrelink officer created a record. It indicated that Ms Poniatowska telephoned Centrelink. It recorded that Ms Poniatowska reported gross earnings from Hickinbotham of $400 for the period ended 26 April 2005. It recorded “CUS is RIS-EAN”. No evidence was adduced from Centrelink as to the meaning of this.

23. On 24 May 2005 a Centrelink officer created a record. It indicated that Ms Poniatowska telephoned a Centrelink officer regarding “Participation Planning Interview/Contact for Jobseeker Registration”. It recorded that Ms Poniatowska declined “Service Offer for Job Network registration and referral” because she was “already working”. No evidence was adduced from Centrelink as to the conversation concerning Ms Poniatowska working. The record said “No varying earnings for EPD”. No evidence was adduced from Centrelink to explain what this meant or as to the conversation that led to its being recorded. The fact that Ms Poniatowska was working must logically have been seen by the officer as consistent with recording “No varying earnings for EPD”.

24. On a date after 30 May 2005 Hickinbotham sent a commission statement to Ms Poniatowska in respect of the period between 29 April and 30 May 2005. It showed details of six house and land packages (three of which were carried over from the previous month), none of which had been accepted by Hickinbotham.

25. On 10 June 2005 a Centrelink officer created a record. It indicated that Ms Poniatowska telephoned a Centrelink officer regarding “Participation Planning Interview/Contact for Jobseeker Registration”. It recorded that Ms Poniatowska declined “Service Offer for Job Network registration and referral” because she was “already working commission only at the moment”. No evidence was adduced from Centrelink as to the conversation concerning Ms Poniatowska working or her commission. The record said “Customer’s FTB Estimate checked: Yes”. No evidence was adduced from Centrelink as to the conversation concerning the estimate. The record said “CUS is RIS-EAN” and “No varying earnings for EPED”. No evidence was adduced from Centrelink as to the meaning of this.

1. On 28 June 2005 a Centrelink officer created a record. It indicated that Ms Poniatowska telephoned a Centrelink officer. It recorded “CUS is RIS-EAN” and “No varying earnings for EPED”.

2. On a date after 29 June 2005 Hickinbotham sent a commission statement to Ms Poniatowska in respect of the period between 30 March and 29 June 2005. It showed seven addresses (six of which had been carried over from previous months).Two had now been accepted by Hickinbotham. It showed payment of two initial instalments of $600 commission ($1,200 in total). As noted above, this was conditional on those contracts proceeding and not being cancelled.

3. On 29 June 2005 Hickinbotham paid by direct credit into the CBA account $1,074 (presumably $1,200 less income tax).

4. On 1 July 2005 Hickinbotham issued a PAYG payment summary in respect of Ms Poniatowska showing gross income for the year ended 30 June 2005 of $7,200 which was provided to Ms Poniatowska and presumably to the Australian Taxation Office.

5. On 7 July 2005 a Centrelink officer created a record. It indicated that Ms Poniatowska telephoned a Centrelink officer. It recorded “CUS is RIS-EAN” and “No varying earnings for EPED”.

6. On 7 July 2005 Centrelink wrote a letter to Ms Poniatowska. The letter was addressed to the Prospect PO box. The letter extended the reporting periods covered by the second 7 April letter to the fortnights ended 19 July through to 27 September 2005. The letter also referred to Ms Poniatowska’s family tax benefit estimate of $30,000 last updated on 19 August 2003.     The trial Judge did not make a finding that Ms Poniatowska received this letter.

7. On 21 July 2005 a Centrelink officer created a record. It indicated that Ms Poniatowska telephoned a Centrelink officer. It recorded “CUS is RIS-EAN” and “No varying earnings for EPD”.

8. On a date after 28 July 2005 Hickinbotham sent a commission statement to Ms Poniatowska in respect of the period between 30 June and 28 July 2005. It showed details of seven addresses (all carried over from previous months).  No additional contracts had been accepted by Hickinbotham during the month.

9. On 2 and 18 August 2005 a Centrelink officer created a record. Each record indicated that Ms Poniatowska telephoned a Centrelink officer. Each record said “CUS is RIS-EAN” and “No varying earnings for EPD”.

10. On about 9 August 2005 Ms Poniatowska’s accountant Ben Reynolds lodged her tax return for the year ended 30 June 2005 with the Australian Taxation Office. It showed gross income from Hickinbotham of $7,200, taken from a PAYG payment summary issued by Hickinbotham. It also showed parenting payment from Centrelink totalling $11,738.

11. On a date after 29 August 2005 Hickinbotham sent two different commission statements in respect of the period between 29 July and 29 August 2005 to Ms Poniatowska. One showed eight addresses (seven carried over from previous months), six of which were shown as having been accepted by Hickinbotham during the month and payment of six initial instalments of $600 ($3,600 in total). The other showed one address, which had now been accepted by Hickinbotham during the month and payment of one initial instalment of $600 commission.

12. On 30 August 2005 Hickinbotham paid by direct credit into the CBA account $2,961 (presumably $4,200 less income tax).

13. On 1 September 2005 a Centrelink officer created a record. It indicated that Ms Poniatowska telephoned a Centrelink officer. It recorded “CUS is RIS-EAN” and “No varying earnings for EPED”.

14. On 5 September 2005 Centrelink wrote a letter to Ms Poniatowska. The letter was addressed to the Prospect PO box. The letter referred to both parenting payment and family tax benefit without clearly distinguishing between them. The letter said:

    Changes to Your Reporting

    IMPORTANT Information about your Parenting Payment - Single

    As your circumstances have changed, you are no longer required to report every two weeks to get paid. You must tell us within 14 days about events or changes in circumstances affecting your payment (see the enclosed form ‘Changes you must tell Centrelink about’ for details). If your family income has changed from what you previously told the Family Assistance Office, please call 13 6150 to provide a new estimate for Family Tax Benefit.

    Enclosed in this letter

    1.   Your Account Statement

    This contains information about your payments, income and other details. To update your details please contact Centrelink.

    2.   Changes you must tell Centrelink about

    This form lists the changes that you must tell Centrelink about.

    Your Rights

    If you think our decision is wrong, phone us or come and see us. We will check the facts and explain the decision. If you still do not agree, you can ask for one of our Authorised Review Officers (ARO) to look at it. The ARO I an officer who has no previous involvement in your case, and if the decision is wrong, the ARO can correct it. The ARO can also tell you how you can appeal to the Social Security Appeals Tribunal (SSAT) if you still do not agree. Both the ARO review and SSAT appeal are free. Remember, if you do not ask for the decision to be reviewed within 13 weeks of being told about it, you may only get back payment from the date you ask. If you wish to comment on the quality of service you received from us you can talk to our Customer Relations staff on Freecall 1800 050 004. If you have contacted our Customer Relations staff with a concern and they have not been able to resolve it to your satisfaction, you can take the matter further by contacting the Ombudsman’s Office whose toll free “1300” number is listed in your phone book. If you have a hearing or speech difficulty you can contact the Customer Relations unit using a Teletypewriter (TTY) phone on 1800 000 567.

    Privacy and You

    Personal information is protected by law. The authority to collect this information is contained in social security law. The information you provide in response to this letter will be used to decide correct payments and suitability for services for you and, where relevant, third parties (for example, other family members). Certain information may be used to detect or prevent fraud. Centrelink may disclose limited information (for example income and assets) about you to other parties when your circumstances affect their entitlement to payments and services. Limited personal information may be used to conduct customer surveys run by Centrelink, its client departments or by research organisations on their behalf (see the factsheet ‘Customer Research and You’). Centrelink can give your information to someone else in special circumstances where Commonwealth legislation allows or requires or where you give permission. For example, Centrelink usually gives some or all of your information about income and taxation matters to the Australian Taxation Office. You can get more information from the fact sheet called ‘Your Right to Privacy’.

    Taxation

    Parenting Payment, like wages and salaries is part of your taxable income. If tax is not deducted from your payment, and your total income is over the tax threshold, you may have to pay tax in a lump sum at the end of the financial year. The Tax Office can tell you how much this may be. You can ask us to take tax out of your payments at any time.

    (Punctuation added)

15. The letter enclosed a standard form entitled “Changes you must tell Centrelink about” which said:

    Changes you must tell Centrelink about

    This information notice is given under social security law by a Commonwealth entity. You have an obligation to provide Centrelink with all the information that is relevant to your payment. Giving false or misleading information is a serious offence. Information provided by you may be checked under Centrelink’s data-matching programs. You must tell Centrelink within 14 days (28 days if residing outside Australia) if any of the following happens to you, or you become aware that any of the following is likely to occur. You can tell us by writing, phoning or coming into any of our offices. If you don’t tell Centrelink about changes you could have a debt. If you have a debt you may have to pay all or some of the money back.

    Employment: start, stop, recommence or change work in any form of profession, trade business or self-employment income from employment changes (the amount earned goes up or down).

    Accommodation and Rent: change address, or move into a retirement village, or are admitted to a nursing home or hostel; start or stop sharing accommodation with another person or the amount of rent paid changes; start or stop paying rent to a State, Territory or Commonwealth Housing Authority.

    Relationships and Children: your marital status changes, e.g. you marry, separate, become widowed, reconcile with a former partner or live with a new partner; have a change in the number of children in your care or starting sharing the care of a child; if sharing the care of a child, the amount of time the child spends with you changes; receive maintenance/child support for yourself or your children (whether periodic lump sum or capital transfer) including any regular support similar to maintenance/child support (such as payments made to another person on your behalf for mortgage, rent, and school fees) or the amount of maintenance/child support changes; a dependent child leaves home, or is granted a pension, benefit or allowance, or leaves Australia, or stops full-time study and starts working.

    Income, Assets and Investments: buy, sell, change, get any money from, or receive a bonus from any shared or managed investments; get money from a superannuation or rollover fund or get any leave entitlements; income stream payments/investments change, e.g. annuities or superannuation pensions; sell your house/buy another home or the income you receive from an investment property changes; become involved in a business, company or trust; the value of your assets or financial investments changes by more than $1,000; gift assets or sell them for less than their value; get any money from ANY other source;

    Compensation: you must tell us within 7 days if you (or your partner) have received compensation or become aware that you will receive compensation.

    Other: change or close the account we send your payment to; plan to leave Australia (including holidays); have a change in visa status; are imprisoned (e.g. in goal, police station, weekend detention, psychiatric confinement) if you a Participation Plan and you would like to discuss or change your agreed activities.

    Going Outside Australia: If you or a dependent family member plans to travel outside Australia, you must let us know within 14 days of making the decision to go. Please check with us to make sure of your entitlements during your absence. You may not be entitled to some or all of your payments for the period you are away. If you do not advise Centrelink of your departure, your payment may be stopped while you are overseas. Please note this requirement also applies if you go to Norfolk Island.

    What is income?

    Income has a very broad meaning for social security purposes. Some example[s] of income are earnings from employment (including fringe benefits), business income (including farms), income from rental properties, deemed income from financial investments, income from superannuation pensions and other income streams, income paid from overseas including pensions, most compensation payments. If you have a partner, that person’s income may affect your payment.

    What are assets?

    Assets include the value of goods, cars, boats, furniture, money, investments, real estate, personal property, any interest in any property, any debt owing to you and any other right or interest. Assets do not include the value of the home in which you live or special aids for people with disabilities.

    (Punctuation added)

16. The letter also enclosed a document entitled “Your Account Statement for Parenting Payment” which said:

    Your Account Statement for Parenting Payment

    If you need to update any information or you have any questions, call Centrelink on 13 61 50.

    This Account Statement is for the period 6 July 2005 to 5 September 2005. Keep this information for your records.

    Your Working Credit balance

    Working Credit allows you to earn more money from work before your payment is affected.

    As at 5 September 2005         400

    As at 6 July 2005                  191

    Your rate of payment

    Your future rate of payment may change depending on the amount of your earnings, other income or assets.

    Payment from 31/08/2005 – 13/09/2005 due on 15/09/2005       $482.10

    Payment from 14/09/2005 – 27/09/2005 due on 29/09/2005       $509.70

    From 13 October 2005 Parenting Payment Single                   $488.90

    Plus Pharmaceutical Allowance   $5.80

    Total   $494.70

    Your previous payments

Period	Payment Type	Date paid	Amount Paid
17 August 2005 to 30 August 2005	Parenting Payment	5 September 2005	$482.10
17 August 2005 to 30 August 2005	Family Tax Benefit	1 September 2005	$507.92
3 August 2005 to 16 August 2005	Parenting Payment	22 August 2005	$482.10
3 August 2005 to 16 August 2005	Family Tax Benefit	18 August 2005	$507.92
20 July 2005 to 2 August 2005	Family Tax Benefit	4 August 2005	$507.92
20 July 2005 to 2 August 2005	Parenting Payment	4 August 2005	$482.10
6 July 2005 to 19 July 2005	Parenting Payment	25 July 2005	$482.10
6 July 2005 to 19 July 2005	Family Tax Benefit	21 July 2005	$507.92

Your reported earnings

Period	Type of work	Amount
6 July 2005 to 5 September 2005	$0.00

Your current income and assets

As at 5 September 2005

Type	Income per fortnight	Asset amount
Financial Investments	$0.17	$150.00
Other assets	-	$15,000.00
Real estate/business	$0.00	$50,000.00

*Financial investments include savings, shares, and managed investments. Income from these investments is deemed interest. To find out more about deemed income, contact Centrelink.

Changes to your income and assets

There were no changes to your income/assets in the period 06 July 2005 to 04 September 2005.

Your Family Tax Benefit estimate

If you need to update your Family Tax Benefit estimate please call the Family Assistance Office on 13 6150. Last updated on 19 August 2003 $30,000.00

(Punctuation added)

1. The trial Judge found that Ms Poniatowska received this letter.

2. As from 20 September 2005, pursuant to biannual indexing, Ms Poniatowska’s ordinary rate of parenting payment increased to $494 per fortnight and family tax benefit increased to $509 per fortnight.

3. On 21 September 2005 a Centrelink officer created a record. It related to a “Plan”. It referred to what appears to have been a detailed interview of Ms Poniatowska. It referred to other screens described as “PAR S”, “PAES” and “PFWS”. It recorded that Ms Poniatowska declined “to be registered with a Job Network Provider” because she was “Already working commission only at the moment”.

4. At the end of each month from September 2005 onwards while Ms Poniatowska was still employed, Hickinbotham issued usually two commission statements for the period commencing on the day after the end of the previous period and ending on various different days in the last week of the month. These statements showed similar information to that summarised above in respect of the August 2005 statements. Ms Poniatowska received commission of $4,200 for September, $6,134 for October, $4,200 for November, $600 for December 2005 and $1,336 for January 2006.

5. On 29 November 2005 a Centrelink officer created a record. It recorded a request by Ms Poniatowska for details of all income and assets held on record to be sent. It recorded that an immediate print of a Q062 was prepared for customer. On 29 November 2005 Centrelink prepared a letter to Ms Poniatowska addressed to her Prospect PO address bearing the code Q062. It recorded that she was currently receiving $494 per fortnight in parenting payment and $509 per fortnight in family tax benefit. It recorded various assets. It also referred to earnings of $400 from Hickinbotham Homes on 10 May 2005 and $700 from Hickinbotham on 12 April 2005.

6. On 21 February 2006 Hickinbotham terminated Ms Poniatowska’s employment ostensibly on the ground of poor performance. At the time of termination, Ms Poniatowska was suffering from depression. Her general practitioner gave her a referral to a psychiatrist, but she did not see him at that stage.

7. As from 20 March 2006, pursuant to biannual indexing, Ms Poniatowska’s ordinary rate of parenting payment increased to $505 per fortnight and family tax benefit increased to $511 per fortnight.

8. On 6 April 2006 a Centrelink officer created a record. It recorded that Ms Poniatowska telephoned Centrelink and said that her children were no longer using their existing child care providers.

9. On 11 April 2006 a Centrelink officer created a record. It recorded that Ms Poniatowska telephoned Centrelink and said that her children had commenced with new child care providers on 7 April 2006. It recorded that an income estimate was discussed. No evidence was adduced from Centrelink as to the conversation concerning an estimate. It recorded that child care benefit for the new service providers was granted. It referred to a “HAL/ES” screen.

10. After termination of her employment, Ms Poniatowska continued to receive commission from Hickinbotham in respect of contracts signed by customers before her termination as follows:

Date	Amount (before tax)
27 February 2006	$2,900
30 March 2006	$2,345
27 April 2006	$4,029
May 2006	Nil
29 June 2006	$12,828
28 July 2006	$5,177
30 August 2006	$2,766
28 September 2006	$5,795
30 October 2006	$1,467
29 November 2006	$6,381
December 2006	Nil
January 2007	Nil
27 February 2007	$3,977
March 2007	Nil
April 2007	Nil
30 May 2007	$3,167

1. On 22 May 2006 Ms Poniatowska commenced employment with AV Jennings. Her salary was $1,305 per fortnight. In addition she was entitled to commission on sales provided that she met certain criteria. On 24 May she was paid $391 and thereafter she was paid $1,305 per fortnight. She did not receive any commission payments until 30 August 2006.

2. On 30 May 2006 a Centrelink officer created a record regarding “Participation Plan Interview/Contact for Jobseeker Registration”. It related to a telephone conversation with Ms Poniatowska. It recorded that Ms Poniatowska declined job network registration, the reason being “full-time work”. No evidence was adduced from Centrelink as to the conversation concerning this employment. Ms Poniatowska gave evidence that she told the officer that she was employed by AV Jennings on a salary of about $1,300 per fortnight plus commission. The trial Judge did not find that Ms Poniatowska did not provide this information.

3. On 14 June 2006 Centrelink wrote a letter in standard form to Ms Poniatowska in similar terms to the letter dated 10 March 2005 referred to at [33] above. The letter was addressed to the Prospect PO box. The trial Judge found that Ms Poniatowska had ceased to use the Prospect PO box by this time and proceeded on the basis that she did not receive this letter.

4. On 21 June 2006 a Centrelink officer created a record. It recorded that Ms Poniatowska attended at the Port Adelaide office “regarding General Enquiry, Change in Income Details, for Client”. No evidence was adduced from Centrelink as to the discussion concerning change in income details. The record recorded that Ms Poniatowska registered for self-service. It recorded that they discussed an FTB estimate and CCB. No evidence was adduced from Centrelink as to the discussion concerning the estimate or CCB.

5. Ms Poniatowska gave evidence that she gave an estimate of annual income of approximately $38,000. The trial Judge did not find that Ms Poniatowska did or did not give such an estimate on this occasion.

6. On 3 July 2006 AV Jennings issued a PAYG payment summary in respect of Ms Poniatowska showing gross income for the year ended 30 June 2006 of $3,002 which was provided to Ms Poniatowska and presumably to the Australian Taxation Office.

1. On 6 July 2006 Centrelink wrote a letter to Ms Poniatowska. The letter was addressed to her Magill address. It said that payment of her parenting payment had been suspended because Centrelink did not receive a reply to a letter it had sent her (this must have been the letter dated 14 June 2006 but this letter was not mentioned in the 6 July letter).

2. On 6 July 2006 Centrelink wrote a letter to AV Jennings enclosing a form to be completed about Ms Poniatowska’s employment. On 14 July AV Jennings returned the form showing her commencement date as 22 May and her fortnightly salary as $1,305.

3. On 7 July 2006 Hickinbotham issued a PAYG payment summary in respect of Ms Poniatowska showing gross income for the year ended 30 June 2006 of $42,772 which was provided to Ms Poniatowska and presumably to the Australian Taxation Office.

4. On about 27 July 2006 Ms Poniatowska’s accountant Mr Reynolds lodged her tax return for the year ended 30 June 2006 with the Australian Taxation Office. It showed gross income from Hickinbotham of $42,772, taken from the PAYG payment summary issued by Hickinbotham. It showed gross income from AV Jennings of $3,002. It also showed parenting payment from Centrelink totalling $12,702.

5. On 1 August 2006 a Centrelink officer created a record referring to a phone conversation with Ms Poniatowska. It recorded that they discussed an estimate of income for 2006/2007. It recorded an estimate of annual income of $35,000. It recorded “reconciliation process explained to the customer”. It recorded that family tax benefit had been last paid to 26 June 2006 and was now restored with effect on 27 June 2006.

6. On 8 August 2006 a Centrelink officer created a record. It referred to a calculation of debt due by Ms Poniatowska in respect of parenting payment by reason of earnings from AV Jennings from 24 May to 4 July 2006. On the same date Centrelink wrote a letter to Ms Poniatowska at her Prospect PO address. It said that she had been overpaid $1,046 for parenting payment between 24 May and 4 July 2006.

7. On 9 August 2006 a Centrelink officer created a record. It referred to an attendance by Ms Poniatowska at Centrelink’s Adelaide office. It recorded that Ms Poniatowska produced a payslip dated 14 July to 2 August 2006. It recorded that her fortnightly payments of parenting payment were restored from 6 July 2006.

8. On 11 August 2006 a Centrelink officer created a record. It recorded that Ms Poniatowska requested a review of the decision to impose a debt and requested waiver “because she had told Centrelink that she was working and had been advised that her income would not affect her Parenting Payment”.

9. On 11 August 2006 Centrelink wrote a letter to Ms Poniatowska. It was addressed to her Prospect address. It showed amongst other things regular fortnightly earnings of $1,305 and updated family tax benefit estimate of $35,000 per annum.

10. In September 2006 Ms Poniatowska began seeing a psychiatrist Dr Jha. He prescribed antidepressants and anxiolytics.

11. On 2 October 2006 Ms Poniatowska resigned her employment with AV Jennings due to depression and anxiety.

12. On 5 October 2006 a Centrelink officer created a record. It referred to a telephone conversation with Ms Poniatowska. It recorded that Ms Poniatowska said that she had ceased employment with AV Jennings on 2 October 2006. It recorded that her FTB estimate was checked.

13. Ms Poniatowska received the following commission payments (in addition to salary) from AV Jennings:

Date	Amount (before tax)
30 August 2006	$1,674
13 September 2006	$680
27 September 2006	$3,171
5 October 2006	$262
22 November 2006	$1,674

1. In November 2006 Ms Poniatowska moved from Magill to a house at Glen Osmond (the Glen Osmond house).

2. In February 2007 Ms Poniatowska began seeing Dr Czechowicz.

3. On 28 February 2007 Centrelink officer MJ reviewed a data matching with the Australian Taxation Office for Ms Poniatowska for the year ended 30 June 2005 obtained from the Data-matching Program. The review showed that the Australian Taxation Office recorded that she had received $7,200 salary compared to Centrelink’s records which showed income of $3,693.

4. Centrelink officer MJ wrote a letter in standard form to Ms Poniatowska addressed to her Magill address enquiring whether the Australian Taxation Office data was correct and seeking a response by 3 April 2007. The letter was returned undelivered by Australia Post to Centrelink.

5. On 2 April 2007 Ms Poniatowska put in place with Australia Post a one month redirection order redirecting mail addressed to her Magill house to her Glen Osmond house. This redirection order as subsequently extended expired on 2 July 2007.

6. On 2 May 2007 Centrelink officer MJ again compared Centrelink data with data of the Australian Taxation Office for Ms Poniatowska for the year ended 30 June 2006. The Taxation Office recorded that she had received $45,774 salary compared to Centrelink’s records which showed income of $3,003. Centrelink officer MJ wrote a letter in standard form to Ms Poniatowska addressed to the Magill address enquiring whether the Australian Taxation Office information was correct and seeking a response by 5 June 2007.

7. On 18 May 2007 Centrelink officer MJ wrote a letter to Ms Poniatowska addressed to her Magill address requesting provision of tax returns and payslips for the years ended 30 June 2005 and 30 June 2006.

8. On 8 June 2007 Ms Poniatowska sent to Centrelink her tax returns for the years ended 30 June 2005 and 30 June 2006.

9. On 12 June 2007 Centrelink officer MJ sent to each of Hickinbotham and AV Jennings a form requesting verification of earnings for Ms Poniatowska.

10. On 21 June 2007 AV Jennings sent to Centrelink earnings information for Ms Poniatowska.

11. On 2 July 2007 AV Jennings issued a PAYG payment summary in respect of Ms Poniatowska showing gross income for the part year 1 July to 3 October 2006 of $17,877 which was provided to Ms Poniatowska and presumably to the Australian Taxation Office.

12. On 3 July 2007 Hickinbotham issued a PAYG payment summary in respect of Ms Poniatowska showing gross income for the part year 1 July 2006 to 30 May 2007 of $28,730 which was provided to Ms Poniatowska and presumably to the Australian Taxation Office.

13. In July 2007 Ms Poniatowska instituted a proceeding in the Federal Court against Hickinbotham for sexual harassment (the Hickinbotham proceeding). She had earlier in 2006 made a complaint to the Human Rights and Equal Opportunity Commission but conciliation by the Commission did not resolve the matter.

14. On 24 August 2007 Hickinbotham sent to Centrelink earnings information for Ms Poniatowska.

15. On 30 August 2007 Centrelink officer MJ made a record. It referred to her telephoning Ms Poniatowska to discuss why her income had not been declared. It recorded that Ms Poniatowska said that she had provided her tax returns when asked. It recorded that the officer told Ms Poniatowska that past commission would still affect future entitlements because commission is held for 52 weeks. It recorded that MJ told Ms Poniatowska that she had been overpaid and the overpayment was recoverable as a debt. It recorded that Ms Poniatowska became extremely upset and MJ did not get to discuss why all of the income was not advised. MJ was not called to give evidence about this or her subsequent conversations with Ms Poniatowska or her decision not to impose a recovery fee.

16. On 31 August 2007 Centrelink officer MJ made a record. It recorded that Ms Poniatowska telephoned her. It recorded that Ms Poniatowska complained that her income was being assessed when she was no longer working and said that her employer had fired her, this had caused a mental health condition and now she could not work. It recorded that Ms Poniatowska said that she had provided her tax return and talked about estimates.  It recorded that MJ decided not to impose a recovery fee because she believed that Ms Poniatowska did not fully understand her obligations and because she had lost her employment.

17. On 3 September 2007 Centrelink officer MJ made a record.  It recorded Ms Poniatowska’s income from Hickinbotham and AV Jennings and referred to calculation of a debt due to overpayment of parenting payment between 3 August 2005 and 14 August 2007. It recorded that no recovery fee was imposed because “REA - Reasonable excuse for misdeclaration”.

18. On 3 September Centrelink sent a letter to Ms Poniatowska saying that she had been overpaid $19,467 in respect of the period from 3 August 2005 to 14 August 2007. The calculation was made based on allocating commission received in a given fortnight equally over that and the next 25 fortnights. Ms Poniatowska sought a review of the decision.

19. On 4 September 2007 Centrelink officer MJ sent a letter to Ms Poniatowska saying that the decision to reduce her future rate by reference to past commissions for 52 weeks was correct.

20. On 27 September 2007 Centrelink officer DN made a record. It recorded that DN spoke by telephone to Ms Poniatowska. It recorded that Ms Poniatowska said amongst other things that “she did her best to comply with the notification provisions but did not tell Centrelink about all the commissions received because she was sick and not coping”. DN was not called to give evidence about the discussion with Ms Poniatowska.

21. On 24 October 2007 a Centrelink officer made a record. It referred to a telephone conversation with Ms Poniatowska. It recorded that it was agreed that $30 per fortnight would be withheld from future payments over the next three months towards payment of the debt, after which standard withholding would apply.

22. On 25 October 2007 DN affirmed MJ’s decision but sent the file back for recalculation due to errors observed in the calculation.

23. On 26 October 2007 Centrelink recalculated the overpayment at $21,393 in respect of the period 3 August 2005 to 23 October 2007.

24. On about 14 February 2008 Ms Poniatowska’s accountant Mr Reynolds lodged her tax return for the year ended 30 June 2007 with the Australian Taxation Office. Mr Reynolds had deferred completing the tax return pending clarification from Centrelink of the amount of parenting payment considered payable for the year. It showed gross income from Hickinbotham of $28,730, taken from the PAYG payment summary issued by Hickinbotham. It showed gross income from AV Jennings of $17,877 taken from the PAYG payment summary issued by AV Jennings. It also included an eligible termination payment from AV Jennings of $2,828.

25. In April 2008 a complaint was filed in the Magistrates Court by a Centrelink officer against Ms Poniatowska alleging three counts of obtaining a financial advantage in contravention of section 135.2(1) of the Criminal Code (Cth) (the Criminal Code). The complaint was served on 11 May 2008. The counts were identical to each other apart from dates and employers. The body of the charge was the same as the substituted criminal complaint referred to at [131] below. Count one was alleged to have been committed between 16 August 2005 and 9 May 2006; count 2 was alleged to have been committed on 4 July 2006 and count 3 was alleged to have been committed between 1 August 2006 and 5 June 2007. The particulars merely alleged that Ms Poniatowska was not entitled to the said financial advantage, namely payment or part payment of parenting payment because of her income from Hickinbotham or Hickinbotham and AV Jennings.

26. On 11 June 2008 the Legal Services Commission granted legal aid and assigned in-house solicitor Michael Lutt to represent Ms Poniatowska in defence of the prosecution.

27. On 16 June 2008 the trial of the Hickinbotham proceeding in the Federal Court commenced before Mansfield J. The trial concluded on 2 September 2008 when Mansfield J reserved judgment.

28. Dr Czechowicz gave evidence that Ms Poniatowska’s depression and anxiety was exacerbated during the period in which she was awaiting judgment uncertain of the outcome.

29. On 8 July 2008 Mr Lutt made a file note in relation to an attendance by Ms Poniatowska. The file note records that Mr Lutt briefly discussed the matter with Ms Poniatowska. It records that she said that she did not intend to plead guilty to the charges. It records that “she indicated that she had informed Centrelink of where she was working and understood that they would follow up details of her earnings”. It records that she produced a psychiatric report from Dr Czechowicz relating to the stress she was under at her employment. It records that Mr Lutt referred to the prospect of pleading guilty and relying on the report by Dr Czechowicz in mitigation. It records that Mr Lutt explained the elements of the charge. Mr Lutt was not called to give evidence at trial. It is unlikely that at that early stage he did more than identify the elements of the charge contained in paragraphs (a) to (b) of subsection 135.2 of the Criminal Code (extracted at [240] below). On the face of his file note, he did not have sufficient information at that point to attempt to relate the facts to the elements of the charge.

30. On 19 August and 17 September 2008 Mr Lutt made file notes in relation to attendances by Ms Poniatowska upon him to take instructions. The file notes record a relatively skeletal chronological narrative. They record that Ms Poniatowska could not recall her telephone conversations with Centrelink between April and September 2005 and did not now recall why she provided the information recorded in Centrelink records relating to those conversations. They record that Ms Poniatowska:

    ·said that “she never thought she was being overpaid by Centrelink. She didn’t generally check the amounts as to what they were paying her and because she thought they knew about the income, assumed that they were correctly calculating the amount of the payments”;

    ·said that she thought she had reported her commission but may not have done so after she was not required to report fortnightly;

    ·said that “she thought at the end of the year Centrelink would know what she had earned because they had access to her wages records for her employer and that if she had been overpaid, this would then be sorted out”;

    ·again referred to a bundle of medical and psychological reports and asked if this would not provide a defence.

    They record negative comments by Mr Lutt about Ms Poniatowska having a defence and Mr Lutt referring again to the prospect of pleading guilty.

31. In November 2008 Mr Lutt prepared a draft statement by Ms Poniatowska. Documents on the Legal Services Commission file that were tendered indicate that the statement evolved, passing between Mr Lutt and Ms Poniatowska up to June 2009. The statement contained provision for signature by Ms Poniatowska but she did not sign any versions of it.

32. On 5 January 2009 Mr Lutt wrote a letter to the Commonwealth Director of Public Prosecutions requesting that consideration be given to withdrawing the charges. The letter referred to Ms Poniatowska’s major depressive illness and post-traumatic stress disorder. It stated that to the best of her recollection Ms Poniatowska had telephoned Centrelink to report her earnings from both Hickinbotham and AV Jennings. On 12 February 2009 the Commonwealth Director of Public Prosecutions wrote to Mr Lutt saying that the allegation in relation to income from AV Jennings would not be pursued, the charges had been redrafted and a draft new complaint was enclosed.

33. On 19 February 2009 a substituted complaint by the Centrelink officer against Ms Poniatowska alleging 17 counts of obtaining a financial advantage was filed in the Magistrates Court (the Criminal Complaint). The wording of each charge was in common form as follows:

    On or about the [date] at Adelaide or elsewhere in the said State engaged in conduct and, as a result of that conduct, obtained a financial advantage for herself from a Commonwealth entity, namely the Commonwealth Services Delivery Agency trading as 'Centrelink', knowing or believing that she was not eligible to receive that financial advantage; contrary to section 135.2(1) of the Criminal Code (Cth).

34. The particulars of each offence were in common form as follows:

    The defendant was not entitled to the said financial advantage, namely part payment of Parenting Payment Single, because the defendant failed to advise Centrelink of payments of commission received by her from Employment Services Australia Pty Ltd (a subsidiary company of the Hickinbotham Group) while she was in receipt of Parenting Payment Single.

35. The only difference between the counts was the date specified, which ranged from 30 August 2005 (the subject of count 1) to 30 May 2007 (the subject of count 17).

36. The Commonwealth Director of Public Prosecutions did not charge any offences in respect of AV Jennings in the new complaint.

37. On 20 February 2009 there was a pre-trial conference at the Magistrates Court. Mr Lutt told the Magistrate that Ms Poniatowska was defending the charges and the matter was listed for trial on 6 July 2009.

38. On 1 May 2009 Mr Lutt briefed Geraldine Davison (now Judge Davison) to appear as counsel for Ms Poniatowska at the trial in July 2009.

39. On 29 May 2009 Centrelink recalculated the overpayment at $20,162 in respect of the period from 3 August 2005 to 23 October 2007 in relation to the Hickinbotham commissions.

40. On 29 May and 2 June 2009 the Commonwealth Director of Public Prosecutions wrote letters to Mr Lutt enclosing copies of witness statements by a Hickinbotham employee KH and Centrelink employees MD, KS, and MJ. The statements by MD and KS addressed general matters and suggested that they had had no dealings with Ms Poniatowska. The statement by MJ addressed her involvement in relation to Ms Poniatowska’s parenting payments since February 2007 and her dealings with Ms Poniatowska in August and September 2007 referred to at [113] to [117] above.

41. On 12 June 2009 Mr Lutt made a file note of a conference with Ms Davison and Ms Poniatowska which took place on 11 June. It recorded discussion about some peripheral matters and also possible psychiatric evidence from Dr Czechowicz. It recorded that there was a discussion with Ms Poniatowska about the advantages of a guilty plea if she were in fact guilty of the charges and it was explained that “there was a strong case against her”. It was recorded that at this juncture Ms Poniatowska became quite upset but “expressed quite strongly that she would not be pleading guilty to the charges”. The file note did not record any discussion about the elements of the offence, the prosecution evidence said to prove each element, or the merit of the prosecution case in respect of each element.

42. The most recent version of the statement by Ms Poniatowska that Mr Lutt began preparing in November 2008 bears a footer date “12 June 2009”. No evidence was adduced to explain the significance of that date. That statement included references by Ms Poniatowska to various Centrelink records of conversations with her between April and September 2005, in respect of which it stated that she did not now recall the conversations or how she arrived at the figures that were provided. The statement said that she did not recall receiving various Centrelink letters to which the statement referred. The statement said that after she commenced employment with AV Jennings she believed that she rang Centrelink to let them know of her employment. The statement said “At no time did I believe that I was being paid more parenting payment than I should have been receiving”.

43. On 19 June 2009 Mr Lutt made a file note of a conference with Ms Davison and Ms Poniatowska. It recorded discussion about some peripheral matters. It recorded that there was discussion about online notes made by Centrelink officers of discussions with Ms Poniatowska and that Ms Poniatowska “maintained that she thought she was reporting her income”. It recorded that Ms Davison again suggested that Ms Poniatowska “would have great difficulty in effectively putting forward a defence which will be likely to be accepted”; pointed out the advantages of pleading guilty were credit for the plea and mitigating factors could be put forward; and suggested that Ms Poniatowska “give further thought to whether she wished to defend the charges”. The file note does not record any discussion about the elements of the offence, the prosecution evidence said to prove each element, or the merit of the prosecution case in respect of each element.

1. Channel Seven did not prove that Ms Poniatowska understood the letter dated 5 September 2005 in a manner that she knew that she was required to report to Centrelink any income received from Hickinbotham. Given that she knew that Centrelink was aware that she was working for Hickinbotham for commission, and given the wording of the reference in the letter dated 5 September 2005 to employment and income, there is no basis to infer that she must have had this understanding.

2. Ms Poniatowska’s guilty pleas to the Centrelink charges did not amount to an admission that she was guilty of fraud for the reasons set out above. Such statements as she made to Mr Lutt in connection with the Centrelink prosecution suggested that she was innocent of fraud and considered overall and in context do not support an inference of recent invention. Her statements to MJ on 31 August 2007 resulting in MJ’s cryptic notes that she referred to estimates and her tax return, and MJ’s contemporaneous assessment that there was a “reasonable excuse for misdeclaration”, also do not support an inference of recent invention.

3. Channel Seven (regardless of the reason) did not call evidence from Centrelink concerning practice and procedure which could have explained the various notes made by Centrelink officers and (regardless of the reason) did not tender all Centrelink documents relating to dealings with Ms Poniatowska. Channel Seven did not call Mr Lutt to explain or elaborate upon his file notes and dealings with Ms Poniatowska.

4. I have had regard to the Centrelink records of conversations between Ms Poniatowska and Centrelink officers between 22 April and 1 September 2005 insofar as they address Ms Poniatowska’s earnings as relevant to her state of mind, but bearing in mind that the imputations related to fraud alleged to have occurred between 30 August 2005 and 30 May 2007. Given the absence of any other evidence from Centrelink, absence of evidence from Hickinbotham and the time that elapsed since those conversations before Ms Poniatowska was asked to recall what she said and why she said it, the records of those conversations are inconclusive.

5. It is not possible now to know why Ms Poniatowska gave to Centrelink on 22 and 26 April and 12 May 2005 figures of $700, $660 and $400 as income. It may have been based on her own assessment of the commission she was likely to receive and/or her own allocation of monthly payments to fortnightly periods but in any event up to that point she had no entitlement to any commission because no contract had yet been accepted by Hickinbotham. Similarly, it is not possible to know now why Centrelink officers recorded “No varying earnings for EPD” on 7 July and 1 September 2005 in circumstances in which Hickinbotham commission statements for the months of June and August 2005 respectively showed initial commissions of $1,200 and $4,200 respectively. It is not known whether Ms Poniatowska had received the commission statements on the dates of those conversations.

6. Channel Seven contend that Ms Poniatowska accepted that she knew that income would potentially affect the amount of her entitlement to parenting payment. Channel Seven point to Ms Poniatowska’s evidence where she said that she understood that, if her annual income exceeded the relevant threshold (which she believed was $38,000 at some point), the amount of her parenting payment would be reduced by a percentage of the excess. Channel Seven contend that Ms Poniatowska knew in April 2005 that the level of her earnings from Hickinbotham at that time exceeded the threshold because Centrelink wrote to her on 7 April 2005, being the first letter referred to at [39] above, in which it said that she had been overpaid.

7. However, the Judge did not find that Ms Poniatowska received this letter, or that she read or understood it, or that she understood that it was inconsistent with a $38,000 threshold. Beyond being asked in cross-examination whether she received the letter and her denial, Ms Poniatowska was not cross-examined further about understanding the letter and it was not put to her that she understood from the letter that the threshold was less than $38,000. Further, the letter referred to an overpayment by an insignificant amount of $73 compared to an entitlement to parenting payment of $2,333, such that an objective reader would have been unlikely to draw any conclusions from it in relation to the threshold.

8. Channel Seven contend that Ms Poniatowska knew in May 2006 that the level of her earnings from AV Jennings at that time exceeded the threshold because she gave evidence that her parenting payment dropped after she commenced employment with AV Jennings. Ms Poniatowska’s evidence, which was not challenged in cross-examination, was that she did not become aware of a change in her level of earnings until August 2006. The Judge did not make a finding on this topic. Ms Poniatowska was not asked any questions in cross-examination about this change and it was not put to her that the change was inconsistent with a threshold of $38,000 or that she realised at that time that the threshold was not $38,000.

9. Channel Seven contend that, if a party is challenged with a positive belief and puts forward a reason why he or she cannot have that positive belief and that is found to be a lie, that finding can be used as part of a circumstantial case to infer the belief. Channel Seven rely upon a single authority for this proposition, namely a passing observation in the judgment of Mahoney JA in Seymour v Australian Broadcasting Commission.[70] Although detailed submissions were not made by Channel Seven on this contention, they implicitly contend that the rejection of Ms Poniatowska’s evidence as to her beliefs about parenting payment can be used to infer that she believed that she was not entitled to the payments in question.

   [70]   (1977) 19 NSWLR 219 at 232.

10. In Seymour v Australian Broadcasting Commission, Mahoney JA said:

    It must be borne in mind that whilst the jury could, and no doubt did, reject the plaintiff as a witness of truth, rejection of the plaintiff’s evidence did not provide evidence to the contrary of what he said.[71] But the  finding that the plaintiff had been consciously inaccurate in significant matters, for example, in relation to the nature of his association with Regan, might, within proper limits, have been used in aid of the inference that the plaintiff’s conduct involving Regan and his frauds was the result of design. As with silence, so untruthfulness may in a proper case, serve to resolve a doubt or an ambiguity in evidence otherwise probative, and resolve it against such a person: cf Tozer Kemsley & Millbourn (A/Asia) Pty Ltd v Collier’s Interstate Transport Service Ltd (1956) 94 CLR 384 at 403.[72]

    [71]   Citation omitted.

    [72]   At 232.

11. Mahoney JA did not cite any authority in support of the propositions contained in the last two sentences of the passage extracted. The passage from Tozer is a passage in the judgment of Fullagar J (on which the other Justices expressed no opinion) and merely contained a statement of what later came to be known as the rule in Jones v Dunkel. Glass JA (with whom Reynolds JA agreed) wrote separate reasons for judgment without referring to the reasons for judgment of Mahoney JA. More importantly, Mahoney JA merely applied the same approach in what is now known as the rule in Jones v Dunkel to a case in which the evidence of the other party is rejected: Mahoney JA did not suggest that rejection of the plaintiff’s evidence could itself result in drawing of this inference.

12. To the extent that Channel Seven rely upon the Judge’s rejection of Ms Poniatowska’s evidence about her beliefs, the Judge’s reasoning in that respect was flawed for the reasons given above. In addition, it is crucial to avoid circularity of reasoning. For the reasons explained above, the question whether Ms Poniatowska’s evidence about her beliefs should be rejected is intimately connected with and dependent on the question whether the other evidence in the case was capable of proving that she believed that she was not entitled to the parenting payments in question. Channel Seven’s contention involves circularity of reasoning.

13. Channel Seven contend in the alternative that the lies that the Judge found were told by Ms Poniatowska about her beliefs can be used as evidence of the requisite mental element via consciousness of guilt reasoning. This contention founders for the same reasons.

14. I have reviewed the whole of the documentary and testimonial evidence adduced at trial, including the Centrelink and Legal Services Commission documents relied on by Channel Seven, the cross-examination of Ms Poniatowska and the evidence given by Ms Davison and the other witnesses called by Channel Seven. Having regard to the fact that Channel Seven bore the onus of proof and the need to take into account the seriousness of the allegation of fraud, Channel Seven failed to prove that Ms Poniatowska was guilty of fraud either in the “legal” sense or the ordinary “lay” sense and failed to establish the defence of justification.

    Fair comment

15. Channel Seven’s primary contention at trial was and on appeal is that all of the imputations that the Judge found proved were statements of fact and hence no question of a defence of fair comment (or honest opinion) arose. In the alternative Channel Seven contended at trial that the words “the cheat who got away” comprised a comment (or statement of opinion) and relied on the common law defence of fair comment (the fair comment defence) and the statutory defence under section 29 of the Defamation Act (and its interstate analogues) (the statutory honest opinion defence).

16. The Judge did not decide whether the words “the cheat who got away” comprised a statement of fact as opposed to comment (or statement of opinion). However the Judge proceeded to consider whether the defence of fair comment at common law was established apparently on the assumption that the words did not comprise a statement of fact and concluded that it was so established. The Judge referred to the statutory honest opinion defence but did not decide that it applied.

17. The fair comment defence (and the statutory defence of honest opinion) applies to an imputation found as opposed to the words in the publication giving rise to the imputation.[73]

    [73]   Channel Seven Adelaide v Manock [2007] HCA 60, (2007) 232 CLR 245 at [80]-[85] per Gummow, Hayne and Heydon JJ.

18. Accordingly, the Judge should have addressed the imputation that he found that referred to Ms Poniatowska getting away, namely:

    Ms Poniatowska got away with her dishonesty and or fraudulent behaviour

    which the Judge qualified by finding the imputation established as meaning:

    she got away with her dishonesty and or fraudulent behaviour in the sense that she engaged in dishonest or fraudulent conduct and was prosecuted but that the prosecution foundered on a legal technicality or loophole

19. Given my conclusion that Channel Seven failed to establish the defence of justification in respect of the underlying imputation that Ms Poniatowska was guilty of dishonesty and fraud, there is little significance in the question whether the additional imputation that she got away with this conduct is or is not the subject of a defence of fair comment.

20. The question whether a statement is one of fact or comment/opinion is determined objectively from the perspective of the ordinary reasonable recipient.[74] On the Judge’s finding of the content of the imputation, it was a statement of fact rather than a comment/opinion. If the factual premise is accepted that Ms Poniatowska engaged in dishonesty and fraud, it is a simple statement of fact that she got away with it in the sense that the prosecution of her failed. The composite imputation that she engaged in dishonesty and fraud and got away with it was a statement of fact. No defence of fair comment (or honest opinion) therefore arose.

    [74]   Channel Seven Adelaide v Manock (2007) 232 CLR 245 at [36] per Gummow, Hayne and Heydon JJ.

21. In any event, a defendant who relies on the defence of fair comment must establish that the comment was “fair”, which means essentially that:

    ·“the facts on which it is based are stated or indicated with sufficient clarity to make it clear that it is comment on those facts”;[75]

    ·the defendant proves the truth of the facts on which the comment is based (the underlying facts);[76]

    ·the comment is one which an honest person could reasonably make based on the underlying facts;[77]

    ·the comment is on a matter of public interest.[78]

    [75]   Pryke v Advertiser Newspapers Ltd (1984) 37 SASR 175 at 192 per King CJ (with whom White J agreed); C v L & ORS [2005] SASC 315 at [79] per Besanko J (with whom Anderson J and Layton J agreed); Channel Seven Adelaide v Manock (2007) 232 CLR 245 at [6] per Gleeson CJ and [35] and [45]-[47] per Gummow, Hayne and Heydon JJ.

    [76]   Peter Walker & Son Ltd v Hodgson [1909] 1 KB 239 at 250 per Vaughan Williams LJ 254 per Buckley LJ and 256-257 per Kennedy LJ; Digby v Financial News Ltd [1907] 1 KB 502 at 508 per Collins MR; C v L & ORS [2005] SASC 315 at [79] per Besanko J (with whom Anderson J and Layton J agreed); Pervan v North Queensland Newspaper Co Ltd (1993) 178 CLR 309 at 322 per Mason CJ, Brennan, Deane, Dawson, Toohey and Gaudron JJ and 341-342 per McHugh J; Channel Seven Adelaide v Manock (2007) 232 CLR 245 at [6] per Gleeson CJ and [35] per Gummow, Hayne and Heydon JJ.

    [77]   C v L & ORS [2005] SASC 315 at [79] per Besanko J (with whom Anderson J and Layton J agreed); Channel Seven Adelaide v Manock (2007) 232 CLR 245 at [90] per Gummow, Hayne and Heydon JJ.

    [78]   C v L & ORS [2005] SASC 315 at [79] per Besanko J (with whom Anderson J and Layton J agreed); Theophanous v Herald & Weekly Times Ltd (1994) 182 CLR 104 at 175 per Deane J; Bellino v Australian Broadcasting Corporation (1996) 185 CLR 183 at 193 per Brennan CJ and 240 per Gaudron J.

22. If the imputation were characterised as one of comment rather than fact, it was based on the statement of fact that Ms Poniatowska was guilty of fraud and dishonesty. Channel Seven failed to prove the truth of this statement of fact for the reasons given above.

23. Accordingly, any defence of fair comment failed. The Judge did not find that the statutory honest opinion defence was established. In any event it failed for the same reasons. The imputation was not a statement of opinion and it was not, as required by section 29(5)(a) of the Defamation Act and its interstate analogues, based on material that Channel Seven proved was substantially true.

    Fair report

24. Channel Seven pleaded that the defamatory matter published constituted a fair report of the court proceedings comprising the criminal proceedings in the Magistrates Court, Supreme Court and High Court, thereby giving rise to the common law and statutory defences of fair report.

25. The Judge found that both the common law and statutory fair report defences were established.

26. Subsections 27(1) and (2) of the Defamation Act (and its interstate analogues) provided:

    27—Defences of fair report of proceedings of public concern

    (1)It is a defence to the publication of defamatory matter if the defendant proves that the matter was, or was contained in, a fair report of any proceedings of public concern.

    (2)It is a defence to the publication of defamatory matter if the defendant proves that—

    (a)     the matter was, or was contained in, an earlier published report of proceedings of public concern; and

    (b)     the matter was, or was contained in, a fair copy of, a fair summary of, or a fair extract from, the earlier published report; and

    (c)     the defendant had no knowledge that would reasonably make the defendant aware that the earlier published report was not fair.

27. Subsection 27(4) defined “proceedings of public concern” to include “any proceedings in public of a court or arbitral tribunal of any country”. Subsection 27(3) provided that the defence was defeated if the plaintiff proved “that the defamatory matter was not published honestly for the information of the public or the advancement of education”.

28. Channel Seven was required to prove that the defamatory matter was or was contained in an earlier published report of the proceedings. The published report of the High Court judgment was to the effect that Ms Poniatowska was not guilty of the contraventions of section 135.2 alleged against her. The High Court found that the charges were misconceived. The High Court did not find that Ms Poniatowska was otherwise guilty of fraud. A summary of the stories is set out at [326] to [328] above. The component of the stories that comprised a report of the High Court proceedings was confined to the brief references to the High Court decision as a “legal landmark” and that the High Court “ruled Poniatowska had no legal obligation to tell them she was employed and earning an income”. The only other reference to the criminal proceedings was that Ms Poniatowska had been “convicted of receiving sole parenting benefits while working for a building company”. To the extent that this referred to the proceeding in the Magistrates Court, even if this were contained in a published report (which Channel Seven did not prove), it was manifestly superseded by the High Court judgment (and indeed by the Full Court judgment to which the stories did not refer).

29. The balance comprising the vast majority of the stories, and the implications of fraud, cheating and dishonesty, were allegations Channel Seven chose to make themselves. They also chose to introduce gratuitous and extraneous matters, such as comparing Ms Poniatowska with the 66 year old greedy granny who fraudulently used multiple identities, “ripping off the taxpayer to the tune of $372,000” over 20 years and the 46 year old mother who “took us for a ride for $156,000” falsely claiming single parent pension over 13 years.

30. Channel Seven was required to prove that the defamatory matter was or was contained in a fair copy or summary of or a fair extract from the earlier published report. This element of the defence also was not established.

31. The common law defence of fair report is a species of qualified privilege[79] and is similar to the statutory defence. It requires a defendant to establish that the defamatory matter is a fair and accurate report of court proceedings.[80] The defamatory imputations must ordinarily first be identified before the defence is considered because the defence must be considered in the context of those imputations.[81] The question whether the defamatory matter is a fair report of court proceedings requires a comparison between the defamatory matter and the content of the court proceedings.[82] 

    [79]   Chakravarti v Advertiser Newspapers Ltd [1998] HCA 37, (1998) 193 CLR 519 at [89] per Gaudron and Gummow JJ (with whom Brennan CJ and McHugh J relevantly agreed).

    [80]   Leslie v Mirror Newspapers Ltd (1971) 125 CLR 332 at 336-337 per Barwick CJ (with whom McTiernan J, Owen J, Walsh J and Gibbs J relevantly agreed); Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 at [89] per Gaudron and Gummow JJ (with whom Brennan CJ and McHugh J relevantly agreed)

    [81]   Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 at [2] per Brennan CJ and McHugh J and [153] per Kirby J.

    [82]   Leslie v Mirror Newspapers Ltd (1971) 125 CLR 332 at 338-339 per Barwick CJ (with whom McTiernan J, Owen J, Walsh J and Gibbs J relevantly agreed); Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 at [153] per Kirby J.

32. To be a fair and accurate report, the defamatory matter:

    ·must be a report of the court proceedings or that part thereof of which it purports to be a report: it is not sufficient that the proceedings are the source of information, or the subject, of an expression of opinion;[83]

    ·must be a substantially accurate expression of the court proceedings or the part thereof of which it purports to be a report;[84] and

    ·must not substantially alter the impression that an ordinary reasonable recipient would have gained if present during the proceedings.[85]

    [83]   Rogers v Nationwide News Pty Ltd [2003] HCA 52, (2003) 216 CLR 327 at [18] per Gleeson CJ and Gummow J.

    [84]   Thom v Associated Newspapers Ltd (1964) 64 SR (NSW) 376 at 380 per Herron CJ and Ferguson J and 385 per Sugerman J; Anderson v Nationwide News Pty Ltd (1970) 72 SR (NSW) 313 at 318 per Asprey JA and 323-324 per Mason JA; Chakravarti v Advertiser Newspapers Ltd [1998] HCA 37, (1998) 193 CLR 519 at [42] per Gaudron and Gummow JJ (with whom Brennan CJ and McHugh J relevantly agreed).

    [85]   Leslie v Mirror Newspapers Ltd (1971) 125 CLR 332 at 337 per Barwick CJ (with whom McTiernan J, Owen J, Walsh J and Gibbs J relevantly agreed); Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 at [153] per Kirby J.

1. The stories failed each of these tests for the same reasons as they failed the tests for the statutory defence referred to above.

   Qualified privilege

2. Channel Seven pleaded that the defamatory matter was published on an occasion of qualified privilege pursuant to section 28 of the Defamation Act and its interstate analogues.

3. The Judge found that the statutory qualified privilege defence was established.

4. Subsection 28(1) provided:

   28—Defence of qualified privilege for provision of certain information

   (1)There is a defence of qualified privilege for the publication of defamatory matter to a person (the “recipient”) if the defendant proves that—

   (a)     the recipient has an interest or apparent interest in having information on some subject; and

   (b)     the matter is published to the recipient in the course of giving to the recipient information on that subject; and

   (c)     the conduct of the defendant in publishing that matter is reasonable in the circumstances.

5. In relation to the third element of the defence, subsection 28(3) provided:

   (3)In determining for the purposes of subsection (1) whether the conduct of the defendant in publishing matter about a person is reasonable in the circumstances, a court may take into account—

   (a)     the extent to which the matter published is of public interest; and

   (b)     the extent to which the matter published relates to the performance of the public functions or activities of the person; and

   (c)     the seriousness of any defamatory imputation carried by the matter published; and

   (d)     the extent to which the matter published distinguishes between suspicions, allegations and proven facts; and

   (e)     whether it was in the public interest in the circumstances for the matter published to be published expeditiously; and

   (f)    the nature of the business environment in which the defendant operates; and

   (g)     the sources of the information in the matter published and the integrity of those sources; and

   (h)     whether the matter published contained the substance of the person’s side of the story and, if not, whether a reasonable attempt was made by the defendant to obtain and publish a response from the person; and

   (i)    any other steps taken to verify the information in the matter published; and

   (j)    any other circumstances that the court considers relevant.

6. The critical issue before the trial Judge was the third element that the conduct of the defendant in publishing the matter is reasonable in the circumstances. The Judge’s conclusion that the defence was established is represented in the following passages from the Judge’s reasons:

   The defendants further submit that the defamatory material summarised, in the way described above, the outcome of the prosecution and subsequent appeals. For that reason they say it was reasonable to publish the defamatory material in its entirety.

   …

   I accept the correctness of the contentions made by the defendants that the story presented to the public in a summary fashion the outcome of proceedings on a matter that was of public interest. The proper administration of the social security system, upon which a large part of the federal budget is spent, is a legitimate matter of public interest.

7. The Judge did not explicitly state that the conduct of Channel Seven in publishing the stories was reasonable in the circumstances. While that might be implicit, the Judge did not refer to the factors identified in subsection 28(3) of the Defamation Act.

8. The only ostensible source of information of the stories insofar as they related to Ms Poniatowska was the reasons for judgment of the High Court. Channel Seven chose to make the implications of fraud, cheating and dishonesty against Ms Poniatowska which were not contained in those reasons for judgment. Channel Seven did not when they published the stories have access to the Centrelink documents or the Legal Services Commission file. They knew nothing of the detail of the dealings between Ms Poniatowska and Centrelink. They did not know for example whether Centrelink was aware (as it in fact was) that Ms Poniatowska was employed on a commission basis by the building company to which the story referred, whether she had provided estimates of her annual income to Centrelink (which in fact she had) or whether she lodged tax returns accurately reporting her income from the building company (which in fact she had). Channel Seven had no sources of information from which it could be concluded that Ms Poniatowska had defrauded Centrelink. Nor did they make any effective attempt to obtain Ms Poniatowska’s side of the story. Essentially for the reasons given above in the context of the fair report defence, Channel Seven’s publication of the stories with the defamatory imputations was manifestly unreasonable.

   Extended or constitutional form of qualified privilege

9. Channel Seven pleaded that the defamatory matter was published on an occasion of qualified privilege in that it constituted a discussion of government and political matters and that their conduct in publishing the stories was reasonable in the circumstances.

10. The Judge found that the extended or constitutional qualified privilege defence was established. The Judge found that the stories were published in the course of discussion of government and political matters.

11. The Judge recognised that the onus of proof lay on Channel Seven to prove that their conduct in publishing the defamatory material was reasonable and found that it was. The Judge said:

    In Lange the High Court observed that, as a general rule, a defendant’s conduct in publishing defamatory material will not be reasonable unless:

    (a)     It had reasonable grounds for believing the defamatory imputation was true;

    (b)It took proper steps, so far as they were reasonably open, to verify the accuracy of the material;

    (c)     The defendant did not believe the imputation to be untrue; and

    (d)The defendant sought a response from the person defamed and published any response except in cases where the seeking or publication of a response was not practicable or it was unnecessary to give the plaintiff an opportunity to respond.

    I consider that each of the first three requirements referred to by the High Court have been established by the defendants. That is because the story was, as far as it went, an accurate reflection of the High Court judgement. Thus, the further question is whether it was not practicable or unnecessary to seek a response from Ms Poniatowska prior to publication. She contends that she was not given the opportunity to explain that she was unwell at the time the relevant events occurred and that she had repaid Centrelink in full. I have already rejected these contentions in other contexts on the basis that there was no imputation that she had not repaid the money and it has not been established that the difficulties she was having with her mental health at the relevant time was so substantial that she could not comply with her obligation to inform Centrelink of her income.

    For these several reasons I find that the extended constitutional defence of qualified privilege has been made out.

12. The question whether Channel Seven’s conduct was reasonable in the context of this defence is essentially the same as the question whether their conduct was reasonable in the context of the statutory qualified defence. Their conduct was unreasonable for the same reasons as it was unreasonable in the context of the statutory qualified defence. In particular, because their only source of information concerning Ms Poniatowska was the High Court’s reasons for judgment and they did not know what Ms Poniatowska told Centrelink or what Centrelink knew, they had no grounds for believing the defamatory imputation that Ms Poniatowska defrauded Centrelink and took no steps to verify the accuracy of that imputation.

    Conclusion on liability

13. The Judge erred in finding that the various defences relied on by Channel Seven were established. The Judge should have concluded that none of those defences were established and Channel Seven was liable to pay damages to be assessed to Ms Poniatowska.

    New evidence on appeal

14. As noted above, Ms Poniatowska seeks to adduce new evidence on appeal comprising copies of four Centrelink letters. The Court received the four letters de bene esse pending a ruling whether they would be admitted as new evidence on appeal in the exercise of its discretion. The affidavits of Ms Poniatowska, Ms Repasky, Ms Sandford, Ms Grant and Mr Cursaro were relevant to the exercise of the Court’s discretion whether to admit the four letters as new evidence on appeal.

15. Channel Seven opposed the admission of the four letters as new evidence on appeal and contended in any event that their admission could not affect the result of the appeal.

16. The four letters were relevant only to the issue of justification. Because I have concluded that the trial Judge should have found that the justification defence was not established on the evidence at trial, it is unnecessary to consider whether the four letters should be admitted as new evidence on appeal.

    Apprehension of bias

17. Ms Poniatowska tendered evidence on appeal that the Judge was employed by the Department of Social Security for sixteen years from 1974, commencing as an unemployment benefit assessor and finishing as an Assistant Director in charge of appeals.

18. Ms Poniatowska contends that the Judge’s employment at the Department, which he did not disclose prior to or during the trial, gave rise to a reasonable apprehension of bias because the Judge might be perceived as having sympathy to Centrelink and as having esoteric knowledge of Centrelink procedures as a result of his former employment.

19. Because I have concluded that the appeal must be allowed on other grounds, it is unnecessary to consider this ground of appeal.

    Assessment of damages

20. As noted above, the Judge did not assess damages. The Judge did make certain findings relevant to the assessment of non-economic loss and economic loss, and concluded that Ms Poniatowska was not entitled to aggravated damages.

21. Ms Poniatowska identifies the alternatives of this Court assessing damages or remitting the matter to a single Judge to assess damages. She expresses a preference that this Court assess damages. Channel Seven submits that the assessment of damages should be remitted to a single Judge.

22. In the circumstances, I would hear the parties on the question whether this Court should assess damages or remit the matter to a single Judge to assess damages.

    Conclusion

23. I would make the following orders:

    1.   Appeal allowed.

    2.   Judgment of the Judge set aside.

    3.   Judgment be granted in favour of the plaintiff for damages to be assessed.

    I would hear the parties whether this Court should assess damages or remit the matter to a single Judge for assessment.

24. NICHOLSON J:                I would allow the appeal for the reasons given by Blue J.  I agree with the orders his Honour has proposed.