Read v Gitman

[2023] NSWDC 330

District Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Read v Gitman [2023] NSWDC 330

Hearing dates:

27 - 30 March, 15 May, 14 June 2023

Date of orders:

24 August 2023

Decision date:

24 August 2023

Jurisdiction:

Civil

Before:

Gibson DCJ

Decision:

(1)   Judgment for the plaintiff for the first, second and third matters complained of in the sum of $35,000.

(2)   Costs reserved.

(3)   Liberty to apply in relation to costs and interest.

(4)   Exhibits retained until further order.

Catchwords:

TORT – Defamation – Plaintiff is the chair, secretary and treasurer of the owners committee of a small apartment block – Three publications by the strata manager to owners, a tenant and unit managers concerning her conduct of strata matters – Qualified privilege at common law – Malice – Defence of justification to one imputation – Damages

Legislation Cited:

Defamation Act 2005 (NSW), ss 10A, 34, 35, 38, 39

Home Building Act 1989 (NSW), ss 3, 4, 10, 92(1)(a)

Property and Stock Agents Act 2002 (NSW), ss 3B(1), 8(1), 32(1), 86(1), 103(3), 104(1)(a)

Property Stock and Business Agents Regulation 2014 (NSW)

Strata Schemes Management Act 2015 (NSW), ss 30(4), 33(2), 178(1)(c), Schedule 1, ss 11, 21

Uniform Civil Procedure Rules 2005 (NSW), rr 17.6, 31.10

Cases Cited:

Aktas v Westpac Banking Corporation Limited (2010) 241 CLR 79; [2010] HCA 25

Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158

Balzola v Passas [2020] NSWSC 896

Bashford v Information Australia (Newsletters) Pty Ltd (2004) 218 CLR 366; [2004] HCA 5

Bauer Media Pty Ltd v Wilson(No 2) [2018] VSCA 154

Bennette v Cohen [2009] NSWCA 60

Blatch v Archer (1774) 1 Cowp 63; 98 ER 969

Boulas v Angelopoulos (1991) 5 BPR 11,477

Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34

Callan v Chawk [2023] FCA 898

Carolan v Fairfax Media Publications Pty Ltd (No 7) [2017] NSWSC 351

Carson v John Fairfax & Sons Ltd (1993) 178 CLR 44; [1993] HCA 31

Coles Myer Limited v Webster; Coles Myer Limited v Thompson [2009] NSWCA 299

Cosco v Hutley (No 2) [2020] NSWSC 893

Craig v Williams [2019] NZSC 38; [2019] 1 NZLR 457

Crampton v Nugawela (1996) 41 NSWLR 176

Cush v Dillon and Boland v Dillon [2009] NSWDC 21

David v Abdishou [2012] NSWCA 109

Dillon v Cush; Dillon v Boland [2010] NSWCA 165

Do v Kolsumdet Pty Ltd [2023] FCA 592

Donoghue v Stevenson [1932] AC 562

Drummoyne Municipal Council v Australian Broadcasting Corporation (1990) 21 NSWLR 135

Duma v Fairfax Media Publications Pty Limited (No 3) [2023] FCA 47

El-Debel v Micheletto (Trustee) [2021] FCAFC 117

Ell v Milne (No.8) [2014] NSWSC 175

Eustice v Channel Seven Adelaide Pty Ltd [2020] SASC 4

Fairfax Media Publications Pty v Kermode (2011) 81 NSWLR 157

Favell v Queensland Newspapers Pty Ltd (2005) 219 CLR 165; [2005] HCA 52

Fraser v Holmes (2009) 253 ALR 538

Gayle v Fairfax Media Publications Pty Ltd (No 2) Gayle v The Age Company Pty Ltd (No 2); Gayle v The Federal Capital Press of Australia Pty Ltd (No 2) [2018] NSWSC 1838

Gough v Squillacioti [2021] NSWDC 411

Goyan v Motyka [2008] NSWCA 28

Henderson v London Borough of Hackney [2010] EWHC 1651 (QB)

Holmes a Court v Papaconstuntinos [2011] NSWCA 59; Aust Torts Reports 82-081

Holt v TCN Channel Nine Pty Ltd (2014) 86 NSWLR 96

Horrocks v Lowe [1975] AC 135

Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8

Kalil v Eppinga [2023] NSWDC 107

KSMC Holdings Pty Ltd t/as Hubba Bubba Childcare on Haig v Bowden (2020) 101 NSWLR 729; [2020] NSWCA 28

Lassanah v State of New South Wales (No. 3) [2010] NSWDC 241

Lesses v Maras (2017) 128 SASR 292; [2017] SASCFC 48

Lindholdt v Hyer [2008] NSWCA 264

Lloyd-Jones v Allen [2012] NSWCA 230

Lorbek v King [2023] VSCA 111

Machado & Anor v Underwood & Anor [2016] SASCFC 65

Massoud v Nationwide News Pty Ltd; Massoud v Fox Sports Australia Pty Ltd (2022) 109 NSWLR 468; [2022] NSWCA 150

Moit v Bristow [2005] NSWCA 322

Mowlds v Fergusson (1939) 40 SR (NSW) 311

Palmer v McGowan (No 5) (2022) 404 ALR 621; [2022] FCA 893

Pamplin v Express Newspapers [1988] 1 WLR 116

Papaconstuntinos v Holmes a Court (2012) 249 CLR 534; [2012] HCA 53

Pavlovic v Karzon [2023] QCA 37

Payne v Parker [1976] 1 NSWLR 191

Prager v Times Newspapers Ltd [1988] 1 WLR 77

Roberts v Bass (2002) 212 CLR 1; [2002] HCA 57

Roberts-Smith v Fairfax Media Publications Pty Limited (No 41) [2023] FCA 555

Rogers v Nationwide News Pty Ltd (2003) 216 CLR 327; [2003] HCA 52

Rush v Nationwide News Pty Ltd (No 7) [2019] FCA 496

Sim v Stretch [1936] 2 All ER 1237

Singleton v John Fairfax & Sons Ltd (Supreme Court (NSW), Hunt J, 20 February 1980, unrep)

Slater v Ecosol Pty Ltd [2023] SASC 99

Sobrinho v Impresa Publishing SA [2016] EWHC 66 (QB); [2016] EMLR 12

Stocker v Stocker [2020] AC 593; [2019] UKSC 17

Stoltenberg v Bolton [2020] NSWCA 45; (2020) 380 ALR 145

Toben v Milne [2014] NSWCA 200

Toogood v Spyring (1834) 1 Cr M & R 181; 149 ER 1044

Trkulja v Google LLC (2018) 263 CLR 149; [2018] HCA 25

Trkulja v Markovic [2015] VSCA 298

Xuan v Xu [2022] FCA 508

Texts Cited:

Nil

Category:

Principal judgment

Parties:

Marlene Read (plaintiff)
Mark Gitman (defendant)

Representation:

Counsel:
Mr R Rasmussen (plaintiff)
Mr M J Lewis with Ms A Sapienza (defendant)

Solicitors:
Kalantzis Lawyers (plaintiff)
Clyde & Co (defendant; to 27 July 2023)
McCabes Lawyers (defendant; from 27 July 2023)

File Number(s):

2021/00119359

Publication restriction:

Nil

Judgment

The proceedings and the parties

1. The plaintiff brings proceedings for defamation for three emails published by the defendant, who at the time was the managing agent of Strata Plan 2533, a block of twelve units at 25 Cook St., Randwick, to Lot owners, managers and a tenant. Each of the emails was described in their headings as containing information relevant to a forthcoming Annual General Meeting of the owners corporation.

2. The plaintiff, who had retired in 2006 after a distinguished career as a lecturer in physics, and whose mother owned a unit in this building, had long assisted in maintenance and building issues for her mother and other residents. She was elected to the positions of Chairperson, Secretary and Treasurer of the owners corporation after an Annual General Meeting on 4 March 2019, attended by a majority of the other Lot owners. At the same meeting, she and the Lot owners present had dispensed with the previous strata manager after problems with unlicenced or inappropriately qualified tradesmen. At a meeting on 9 May 2019, the owners corporation appointed MG Strata and BMC Management Pty Ltd to carry out these duties from 7 June 2019, and the defendant was appointed strata manager. During this intervening period, on 28 May 2019, the owners of Lot 2 complained of a leak from Lot 4 and a plumber (“Purple Plumbing”) attended, but otherwise all strata matters were managed by the defendant.

3. At first, relations between the plaintiff and the defendant were cordial. However, the defendant made a series of errors such as paying Purple Plumbing twice, having the corporation’s books out of balance, entering into an insurance contract without consultation and putting monies into the wrong accounts. Then, in November 2019, the plaintiff discovered that the builder carrying out work on Lot 7 which had been approved at the 1 August 2019 meeting was in fact an unlicensed handyman who was the husband of the managing agent for Lot 7. The defendant had never checked the builder’s licence and insurance position. The relationship between the plaintiff and defendant deteriorated and, prior to the Annual General Meeting on 11 May 2020, the defendant sent three emails to all those persons whose email addresses were in the file as owners or contact persons. Those three emails are the matters complained of.

4. The imputations pleaded may be generally described as being allegations of lying, making false accusations of criminal conduct against the defendant, and wasteful incompetence in the conduct of her obligations to the owners corporation.

5. The plaintiff twice sought an apology from the defendant before proceedings were commenced, the first time on 8 July 2020 and the second on 25 September 2020. No response was received and proceedings were commenced by statement of claim filed on 29 April 2021.

6. The defendant (paragraph 10.2 of the Defence) pleads that each of the three emails complained of was published on an occasion of common law qualified privilege, to which a Reply particularising malice has been pleaded. A defence of justification to imputation 4(d) is also pleaded.

The issues in the proceedings

7. The issues for determination are as follows:

Meaning

1. In respect of each of the three matters complained of, and giving them their natural and ordinary meaning, has the plaintiff’s pleaded imputations been conveyed as a matter of fact to the ordinary reasonable reader?

2. In respect of each of the three matters complained of, and in so far as the Court finds each of the plaintiff’s pleaded imputations are conveyed to the ordinary reasonable reader, has the plaintiff established that those imputations defamatory of the plaintiff?

Publication

3. In so far as the plaintiff has established the element of publication in respect for each of the three matters complained of, what is the extent of publication?

Defences

4. To the extent that the Court finds that the plaintiff’s pleaded imputations are conveyed and defamatory of the plaintiff, then:

1. Has the defendant established that the publication of the defamatory matters was made on an occasion of qualified privilege at common law in respect of each of the three matters complained of?

2. Has the defendant established the substantial truth of imputation 4(d), namely: “The plaintiff wastes the resources of the Owners Corporation by engaging in unnecessary email communications with the strata manager, forcing him to expend excessive amounts of time responding to her”?

5. If the Court finds the defendant has established the defence of qualified privilege at common law, has the plaintiff established that the defence ought to be defeated because the publication of the defamatory matter was actuated by express malice?

Damages and Injunction

6. To the extent that the Court finds that the plaintiff is entitled to an award of damages, what is the appropriate quantum having regard to:

1. The “appropriate and rational relationship” required between the harm sustained by the applicant and the amount of damages awarded under s 34 of the Defamation Act 2005 (NSW); and

2. Any mitigating circumstances relied on by the defendant at [11] of the Defence and having regard to s 38 of the Defamation Act.

7. Is the plaintiff also entitled to an injunction in the terms sought at [2] in the prayer for relief in the Further Amended Statement of Claim filed 21 October 2021.

Costs and Interest

8. What is the appropriate order for costs in all the circumstances? (The parties have asked me to defer this finding, as well as the issue of interest).

8. In relation to the defence of qualified privilege at common law, the defendant must establish that the publication was made on a protected occasion. Once that is established, the burden of proving an improper purpose (and thus malice) then lies on the plaintiff. In relation to the imputation to which justification is pleaded, the sole question is whether the truth of that allegation has been made out (the burden of proof being on the defendant).

The first matter complained of

9. On or about 29 April 2020, the defendant published of and concerning the plaintiff the words in the form of an email sent to the plaintiff and all owners and managing agents of Lots in Strata Plan 2533 with email addresses.

“Dear Marlene,

Purple Plumbing (your contractor) pocketed the building’s money (2^nd payment) and has not refunded it for 6 months. It took us many, many emails and phone calls to get it back from him.

I am just wondering how we made a payment in 2019 and we only received it on 04/02/2020, considering that the payment was the EFT. I am also wondering why Westpac (his bank) sent me the attached notification on 04/02/20 (banked the same day, see below form SP 2533 bank account) if the payment was made in 2019. I am also wondering why he charged so much and did not fix the problem, but my plumber Philip Kauter fixed it, all water damages repaired by DJE in all effected units and we claimed it all on insurance with all other damages.

You are right. Everything should be in writing from this point. The agenda is in the mail. I look forward to discuss these matters at the meeting with all owners. I am copying all owners via BCC.

PS Today you emailed me at least 12 times over the issue that could have been clarified in 5 minutes phone call. In fact the issue should have just been discussed at the AGM. It took me 2.5 hours to respond to your emails, search for information, create statements … I do not believe it is a productive way to spend your building resources and my time.

I strongly encourage all owners to attend the online/phone line AGM (the notice is forthcoming this afternoon).”

10. The imputations pleaded are as follows:

1. The plaintiff is incompetent as Chair of the Owners Corporation, in that she engaged a plumbing contractor on behalf of the Owners Corporation who overcharged the corporation, lied to the strata manager about when he had refunded money paid to him by the Owners Corporation, and failed to provide the services that he had been engaged to provide.

2. The plaintiff lied about moneys being refunded to the Owners Corporation.

3. The plaintiff carelessly and needlessly spent the Owners Corporation’s money.

4. The plaintiff wastes the resources of the Owners Corporation by engaging in unnecessary email communication with the strata manager, forcing him to expend excessive amounts of time responding to her.

The second matter complained of

11. On or about 7 May 2020 the defendant published of and concerning the plaintiff the words in the form of an email sent to the plaintiff and all owners and managing agents of Lots in Strata Plan 2533 with email addresses.

“Dear Marlene,

In relation to item 1, the water bill was entered with the wrong date during bank reconciliation. Please accept my apologies for this error. It has now been corrected. The attached are: BS as it appeared on the AGM notice, amended BS after the adjustment and a copy of the bank statement.

The origin and nature of the missing $618.28 from the cash at the bank account balance as of about May 2019 and during the 2019 reporting year and to where this missing cash amount has now disappeared to in the Balance Sheet and Financial Statement etc. for 2019. Please explain in terms that a Public/Chartered Accountant would understand.

You comment/statement alleging our office unlawful act is false, misleading and offensive. I would anticipate receiving nothing less but an apology. Other 2 items will be discussed at the AGM as previously advised.”

12. The following imputations are pleaded:

1. The plaintiff is a liar in that she falsely accused Mark Gitman and MG Strata Management of engaging in unlawful acts.

2. The plaintiff is a liar in that she falsely accused Mark Gitman and MG Strata Management of engaging in misleading and offensive conduct in relation to Strata Plan 2533.

3. The plaintiff is the type of person who is prepared to make false, misleading and offensive accusations against the defendant and his staff committing an unlawful act with respect to the financial accounts for the Strata Plan that he is managing.

The third matter complained of

13. On or about 11 May 2020 the defendant published of and concerning the plaintiff the words in the form of an email sent to the plaintiff and all owners and managing agents of Lots in Strata Plan 2533 with email addresses.

“Dear owners,

I am writing to you in advance to night’s meeting. The attached are a few emails I received from Marlene over the 2 days. I would like to respond to some of the questions raised by Marlene so all of you have an UpToDate information.

1. Insurance. The insurance company has not changed. Even the policy number is the same. We engaged an alternative broker and achieved a reduction in premium cost nearly $300 (both certificates are attached) despite the fact that most of the polices were increased.

2. The refunds were treated differently due to the fact that one is from the owner of the lot and the other is from the 3^rd party contractor. Both were banked as soon as the funds EFTed to your bank account. We operate the cash accounting system.

I’ll be more than happy to answer all other questions during the meeting tonight. Now I would like to inform you regarding other issues.

Marlene has been basically the only person making all decisions on behalf of you [sic] building since we have taken over the management. We followed most of Marlene’s instructions, but refused to follow some that we believed the other owners should be involved with. Some of them appear on tonight’s agenda. Marlene has no financial interest in the building as she is not the owner and does not pay the levies. But Marlene has been deciding how to spend your money and most of the time ignored our advice. Below are some examples:

We obtained the attached quotation from DJE- $8.778. Marlene engaged BIM (invoices attached) total cost $11.000+. DJE quoted for investigation in unit 7 $330 (the same quotation), but eventually provided a free advise [sic] that no leaks are evident. Marlene engaged Phil Kauter for the cost of $638.00 (invoice attached). (very good plumber, but a bit of waste considering that the information was already available). Purple Plumbing failed to identify and repair the leak in unit 6 and that cost you another $2,300+. That was later repaired by Philip Kauter for around the same amount and claimed on insurance.

Managing you [sic] building has been an extremely challenging task. We have tried our best under the circumstances. Initially I wanted to approach all owners at the meeting and ask to join the committee so the decisions are made collectively by a number of people rather than one person. But recently Marlene alleged our company in committing an offence and holding illegally $618.28.1 have already email you the explanation for this transaction. The allegations are false and absurd. We are a reputable company that provides a good, honest and professional service.

Marlen [sic] would like to join the committee again and emailed me the nomination form. I would find it nearly impossible to continue managing your building if Marlene is on the committee and in charge of your building or/and the only person that makes the decision. Therefore I request that you attend tonight’s meeting and elect the new committee.”

14. The following imputations are pleaded:

1. The plaintiff is incompetent in that she cannot discharge her duties as a member of the Executive Committee of the Owners Corporation, including ignoring the Strata Manager’s advice most of the time and making decisions on her own.

2. The plaintiff mismanaged the Owners Corporation funds by approving a building contractor who overcharged.

3. The plaintiff incompetently deliberately wasted Owners Corporation funds by engaging a contractor to provide services which were unnecessary.

4. The plaintiff is knowingly reckless about the expenditure of Owners Corporation funds in that she acts against the advice of the strata manager.

5. The plaintiff incompetently caused loss and damage to the strata building and the owners corporation by ignoring the advice of the strata manager.

6. The plaintiff is a liar, in that she made a false allegation that MG Strata and BMC Management Pty Ltd had committed a criminal offence.

7. The plaintiff is the type of person who is prepared to make false, misleading and offensive accusations against the defendant and his staff committing an unlawful act with respect to the financial accounts for the Strata Plan that he is managing.

Capacity and defamatory meaning

15. Mr Rasmussen refers me to the statement of principles set out by Wigney J in Rush v Nationwide News Pty Ltd (No 7) [2019] FCA 496 at [74]-[85] (“Rush”). Mr Lewis does not refer to any authority to the contrary.

15. The test for the ordinary reasonable reader remains that set out in Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158 insofar as those principles are distilled in Rush at [75]-[77]. The formality (or lack thereof) of the publication may be a relevant factor in that the ordinary reasonable person may be influenced by the overall tenor of the publication as it is “a feature of certain forms of defamation that one can read or hear matter published concerning a person and be left with the powerful impression that the person is a scoundrel, but find it very difficult to discern exactly what it is that the person is said or suggested to have done wrong” (Drummoyne Municipal Council v Australian Broadcasting Corporation (1990) 21 NSWLR 135 at 137 per Gleeson CJ).

16. The ordinary reasonable reader is taken to have read the whole of the matter complained of, but with varying rates of attention, in that material that is given prominence by capital letters, underlining and/or bold text may gain more of the reader’s attention (Trkulja v Google LLC (2018) 263 CLR 149; [2018] HCA 25 at [32]). Each imputation is to be considered separately in the context of the entire publication in which it is pleaded to be conveyed.

Defamatory meaning

18. As well as challenging capacity, Mr Lewis also challenges the defamatory meaning of all of the imputations, including imputation 4(d). His submissions raise issues which Mr Rasmussen submits misstate the law and conflate the new serious harm test in s 10A of the Defamation Act (“the Act”) with defamatory meaning, which is impermissible. Mr Rasmussen took exception to the following passage from Mr Lewis’s submissions:

“However, it is simply not defamatory to say that that the plaintiff has wasted the resources of the owners’ corporation by engaging in unnecessary email communication with the strata manager. Neither would it be defamatory to say that the plaintiff was careless in the sense pleaded at [4](c) (if conveyed) for similar reasons. Such meanings are so trivial that no right minded person would think the less of the plaintiff: Gough, [19](ix) and (xiii). For observations on such trivial meanings see: Rolph D, “Triviality, Proportionality and the Threshold of Serious Harm” (2019) 23(3) Media and Arts Law Review 280-306. Indeed, it is apposite to cite the observation made (at 398) by Pollock CB in Clay v Roberts (1863) 8LT 397:

“There is a distinction between imputing what is merely a breach of conventional etiquette, and what is illegal, mischievous, or sinful”.

Similar observations were made by Lord Atkin (at 1242) in Sim v Stretch [1936] 2 All ER 1237:

“[T]he protection [of reputation by defamation law] is undermined when exhibitions of bad manners or discourtesy are placed on the same level as attacks on character; and are treated as actionable wrongs.””

(Submissions, paragraph 19)

19. Mr Lewis did not include the sentence appearing before his quotation of Pollock CB’s remarks at page 398 of Clay v Roberts, in which Pollock CB gave examples of non-actionable publications. Mr Lewis went on to state that this particular statement of principle by Pollock CB was endorsed by Lord Atkin in Sim v Stretch [1936] 2 All ER 1237 (at 1242). However, his quotation from Lord Atkin also omits the reference to the examples given by Pollock CB.

20. The full text of what Lord Atkin said is as follows:

“I only cite Clay v Roberts because of its reference to social conditions 70 years ago. It was held that it could not be defamatory to say of a physician that he met homœopathists in consultation.

'Would it be libellous, asked Pollock, C.B., at p. 398, to write of a lady of fashion that she had been seen on the top of an omnibus; or of a nobleman, that he was in the habit of burning tallow-candles? There is a distinction between imputing what is merely a breach of conventional etiquette, and what is illegal, mischievous, or sinful.'”

(Emphasis added)

21. It was in the context of Pollock CB’s examples that Lord Atkin went on to make the observations cited by Mr Lewis. Candles have passed into history (except as a quaint analogy for proportionality), but the trifling nature of such an allegation remains obvious, as does the example of the “lady of fashion” (perhaps in today’s parlance the word “celebrity” might be more apt) who is “seen on the top of an omnibus”.

22. The imputations arising from publications of the kind referred to by Atkin J and Pollock CB are in an entirely different class to the imputations pleaded here. Imputations of wasting an organisation’s money by irresponsible conduct (imputations 4(c), 4(d), 8(a), 8(b), 8(c), 8(e) and 8(f)), falsely accusing a person of a criminal act (imputations 6(a), 6(b), 6(c), 8(g) and 8(h)) and lying about such matters (imputations 4(a), 4(b), 6(a), 6(b), 6(c), 8(g) and 8(h)) are allegations of the kind which have repeatedly been held to be defamatory. It should not be necessary to list the many cases where such imputations have been held to satisfy the test of defamatory meaning, given Kirby J’s warnings in Favell v Queensland Newspapers Pty Ltd (2005) 219 CLR 165; [2005] HCA 52 at [23] about the practice of lawyers pursuing “almost ludicrous elaborations” concerning defamatory meaning.

23. Mr Rasmussen also submits that it would be wrong to categorise neighbourhood disputes as being so unimportant as to be trifling, and to insinuate that accusations such as mismanaging of company affairs or lying, while defamatory if raised in litigation by more important persons in the community or to a group of people of a more impressive number, are therefore somehow not defamatory (cf Do v Kolsumdet Pty Ltd [2023] FCA 592 at [10]).

24. Lord Atkin did not endorse any such categorisation in his formulation of the test defamatory meaning in Sim v Stretch. When Lord Atkin sought to identify a “class of persons” considering a publication to be defamatory, he was not referring to persons with sufficient class for their reaction to the publication to matter, but to every right-minded person in society (resulting in the landmark test of “the estimation of right-thinking members of society generally”, at 1240).

25. Everyone has a reputation, good or bad. In the days of jury trials, counsel opening for the plaintiff would sometimes say to the jury that reputation is democratic, in that everyone has one, no matter how unimportant the plaintiff may seem. The mere fact of publication during what Bromwich J described as a “neighbourhood dispute” does not render the damage done to that reputation to be so trifling as not to give rise to defamatory meaning at all, merely because publication is made in a neighbourhood dispute, as opposed to the celebrity examples identified by his Honour.

26. Lord Atkin, it should also be remembered, was a great admirer of neighbours. The “neighbour principle” (Donoghue v Stevenson [1932] AC 562) is one of the most important principles in the common law. While the “neighbour principle” is irrelevant to the issue of defamatory meaning, it should not be overlooked that the term “neighbour” was invoked because neighbours fill an important role in the social structure. Neighbourliness is a matter of moment in Australian culture, and its qualities highly prized, as the name of Australia’s most famous television soap opera suggests.

27. Mr Rasmussen also complains that Mr Lewis makes this submission globally about all imputations. Challenges to the form, capacity and defamatory meaning should be made to each individual imputation. I do not propose, in those circumstances, to endeavour to work out what imputations Mr Lewis may have particularly objected to, for the reason of “judicial economy” as set out by Leeming JA in Massoud v Nationwide News Pty Ltd; Massoud v Fox Sports Australia Pty Ltd (2022) 109 NSWLR 468; [2022] NSWCA 150 at [37], as I am conscious of appellate concern about unduly lengthy judgments.

28. Finally, I note that I made rulings as to the capacity of the imputations on 16 December 2021. The only challenge as to form was in relation to imputation 8(d), which was withdrawn by reason of Mr Rasmussen accepting that it did not differ in substance from imputation 8(b), although Mr Rasmussen sought leave to change the words in some of the imputations. There was no challenge to defamatory meaning. Challenges to the form and defamatory meaning of the imputations, like challenges to capacity, are best brought in the Defamation List, and preferably at the same time as any challenge to capacity.

Whether each of the imputations in each of the matters is conveyed

29. Each of the publications and each of the imputations should be considered separately.

The first matter complained of

30. When determining whether an imputation has been conveyed, regard must be paid not only to the words used but also to the format and layout and, for the reasons outlined by Gleeson CJ in Drummoyne, the tenor and language, particularly where matters are inferred or hinted at.

31. The format and presentation of the matter complained of are important, as meaning does not just arise from the words. Mr Rasmussen draws my attention to two formatting aspects:

1. The use of the “blind carbon copy” (“BCC”) portion of the email, which is expressed to be copied to “all owners and agents with emails”. Mr Rasmussen submits that this process would give rise, in the mind of the ordinary reasonable person, to a sense of suspicion, as why would the identity of the recipients of the email otherwise speak not be disclosed?

2. The use of bold and underlining in the text to get across the principal stings, namely “your contractors” and “did not fix the problem”, the inference being that these contractors are there at the insistence of the plaintiff as well as performing their work incompetently. In addition, paragraph 7, where the defendant “strongly” encourages the owners to attend the AGM to discuss these issues.

32. As to the “BCC”, this is not merely in bold and underlined but also capitalised, so its importance would be taken to be high. What is so important about a strata agent sending an email to all owners and agents with emails? Mr Rasmussen submits that the reason is to create a sense of suspicion with a hint of subterfuge.

33. In reply, Mr Lewis submits that reasonable readers will be familiar with the nature of email and in particular the function of “BCC”. They would have seen, from paragraph 5, that the author was copying all owners using this method and would not jump to a sense of suspicion but rather have understood it as being used when an author does not want recipients to press the “reply all” button and thereby encourage unnecessary emails in response. Alternatively, the use of the “BCC” would be because the defendant considered it appropriate to protect the recipient’s privacy. Mr Lewis submits that in the context of management of the property with 12 units, such a position would be entirely understandable. Further, the ordinary reasonable reader would understand that the defendant’s purpose is to encourage owners to come to the middle AGM to encourage a discussion of the issue with the buildings plumbing contractor, and not to discuss the plaintiff’s blameworthy conduct.

34. I do not accept either of the submissions. While Mr Rasmussen’s suspicious reader is a step too far, Mr Lewis’s submission overlooks the arresting bold type, underlining and capitals and the repetition, in the body of the letter, that this email is being sent BCC to everyone. The ordinary reasonable person reading such an email would understand that this must be serious, indeed vital, information. This would attract the reader to read closely and to expect to hear information of concern.

35. The next point is the language and style used, which Mr Rasmussen characterises, correctly in my view, as “angry” (submissions, paragraph 10). I particularly note the following features:

1. It is clear, from the language as well as the content, that the defendant is angry with the plaintiff and is responding to conduct he disapproves of by turning the plaintiff’s correspondence with him on its head, such as responding “you are right. Everything should be in writing from this point”. He is not agreeing with the plaintiff in a friendly way; he is being sarcastic and the inference is that it is the plaintiff who is not to be trusted, and not him.

2. This distrust of the plaintiff is emphasised by the repeated use of rhetorical questions such as “I am just wondering how he made a payment in 2019”, “I am also wondering why Westpac” and “I am also wondering why he of charged so much”. The clear inference is that the plaintiff’s version of events is dishonest. When he says “I am wondering”, he is not really wondering at all; he is being sarcastic.

3. This is further underlined by the emphasis given to words such as “your contractor” and “did not fix the problem” in terms of being not only underlined and put in a larger font and bracketed, and followed by the post script which is followed by a recitation of the plaintiff’s alleged wasteful conduct.

4. The wrongdoing of the plaintiff is emphasised by the use of strong words such as “pocketed”, repetition (“many, many”). “Pocketed” infers opprobriously dishonest financial misconduct. The elliptical reference to “2^nd payment” creates the impression that this has happened before, not that the contractors had been asked to refund an accidental double payment of their bill for which the defendant’s oversight was responsible.

36. It is in the context of the form and content of the matter complained of that the question of defamatory meaning must be determined.

1. Imputation 4(a): The ordinary reasonable reader would infer that the plaintiff had insisted on using the incompetent Purple Plumbing, who added insult to injury in that they dishonestly “pocketed the building’s money (2^nd payment)”. What is more, they did not return that sum until the following year. The opaque reference to “2^nd payment” would not mean anything to a reader who did not know that Purple Plumbing had accidentally been paid twice; this, and the “I wonder” references clearly suggest that the plumbers are lying. Not only did these plumbers “overcharge” but they “did not fix the problem”, the third element in the imputation. This is followed, in the rest of the matter, by a recitation of other acts of incompetence by the plaintiff such as emailing the defendant 12 times when she could have made a 5-minute phone call. A vivid picture is created of incompetence as the Chair of the owners corporation. This imputation is conveyed.

2. Imputation 4(b): The imputation that the plaintiff lied about moneys being refunded comes from the sarcastic description of the difficulties the defendant had in getting back the moneys “pocketed” by the plumbers where the excuses for these dishonest contractors given by the plaintiff (to whom the defendant is replying in this email), such as that the money was repaid in 2019, are so implausible as to amount to lying. This imputation is conveyed.

3. Imputation 4(c): The imputation that the plaintiff carelessly and needlessly spent the owners corporation’s money is conveyed by the claim that the defendant could not understand how Purple Plumbing “charged so much”, that Purple Plumbing had “pocketed the building’s money (2^nd payment)”, a reference to them being paid not only carelessly but needlessly and by the complaint at the end of the matter that the defendant had wasted 2.5 hours of his time (which cost the owners corporation money) answering her unnecessary 12 emails. This imputation is conveyed.

4. Imputation 4(d): The defendant concedes that this imputation is conveyed but submits that it is not defamatory.

5. For the reasons set out above, I am satisfied that each of these imputations is conveyed and is defamatory.

The second matter complained of

37. All three imputations convey that the plaintiff is accused of being a liar; the first two are imputations of acts and the third is an imputation of “condition”, which may be pleaded at the same time: Drummoyne Municipal Council v Australian Broadcasting Corporation at 137A (“act or condition”); Toben v Milne [2014] NSWCA 200, approving Singleton v John Fairfax & Sons Ltd (Supreme Court (NSW), Hunt J, 20 February 1980, unrep).

38. Mr Lewis submits, effectively in relation to all imputations, that, unless a reasonable reader impermissibly relied on his or her own prejudices, they would not have led to the conclusion sought by the plaintiff to the effect that she had knowingly made a false accusation. The defendant in fact apologised in part for the error drawn to his attention by the plaintiff. He submits that there is nothing in the matter complained of that would have conveyed, as a matter of fact, that the plaintiff had lied as contended for her in her imputations. I do not accept this submission. The defendant’s apology does not alter the fact that he accuses the plaintiff of dishonesty in relation to her making knowingly false accusations.

39. I make the following findings:

1. Imputation (a): The defendant is demanding an apology for the plaintiff’s false accusations, made in circumstances where it is clear, from the first two paragraphs, that there is a sensible and reasonable explanation for the discrepancy which she must have appreciated when writing what she did in the extract set out from her letter. What else would the defendant mean by using the word “false”? The ordinary reasonable reader would not assume that this was an explanation being given for the first time; the manner of presentation clearly asserts that the plaintiff falsely made these allegations when there was a reasonable and simple explanation. This imputation is conveyed and defamatory in meaning, for the reasons set out above.

2. Imputation (b): Similarly, the clear inference of the demand for an apology for making a statement that was “misleading and offensive” conveys an imputation that the plaintiff was making allegations false to her knowledge, which statements were misleading and offensive. This imputation is conveyed and clearly defamatory.

3. Imputation (c) is that the plaintiff is the kind of person who makes allegations of this type. The matter accuses the plaintiff of making false accusations – in other words, lying – in circumstances where it was inferred that she knew the truth. This imputation is conveyed and, for the reasons set out above, defamatory.

The third matter complained of

40. Mr Rasmussen submitted that the clear and simple language of the third matter complained of renders it a sustained attack on the plaintiff’s competence and honesty, based on the sting of asserted “examples” designed to “inform” the recipients. Each of those allegations is set out in seven separate imputations.

41. Mr Lewis submitted that it would be clear to the ordinary reasonable reader that the defendant is answering only some of the questions raised by the plaintiff and that he would be more than happy to answer any other questions during the meeting. He submits that on no proper reading of the matter complained of do the words convey the meanings contended for by the plaintiff, namely that the defendant had finished answering the questions; the opening words of paragraph 6 would not convey to the ordinary reasonable reader that the plaintiff was responsible for what followed. Ordinary reasonable readers would understand, from those words, that the defendant is reminding them that the plaintiff had been the only person providing him with instructions. In addition, he submits that the word “refused” would not convey that the plaintiff would not want others to be involved but that the defendant wanted to obtain the input of other owners in relation to the making of decisions.

42. I make the following findings:

1. Imputation (a): This is an allegation of incompetence in the form of ignoring the Strata Manager’s advice “most of the time”, followed by “some examples” of such conduct. This imputation mirrors some of the words in the matter complained of, but in a permissible way. This imputation is conveyed and, by reason of the numerous factual “evidence” provided, defamatory.

1. Imputation (b): Paragraph 7 refers to the attached DJE quote for $8778 and the BIM Remedial Building Maintenance Tax Invoices and the “$11,000+” invoices from the builder chosen by the plaintiff, DJE, and goes on to refer to two other examples of the plaintiff needlessly running up tradesmen expenses. The allegation is plainly made that this example of the plaintiff ignoring the defendant’s advice on the choice of tradesmen (paragraph 6) and preferring to use the higher-charging company is mismanagement. This imputation is conveyed and, given the factual examples set out as evidence, defamatory.

2. Imputation (c): Paragraph 7 clearly refers to the plaintiff unnecessarily obtaining a quote from BIM and unnecessarily getting a quote from Mr Kauta for $638. The defendant says that both were unnecessary, He goes on to add in Purple Plumbing fees that “cost you another $2,300+”. There is a clear inference that these quotations were unnecessary as well as costing the building money. This imputation is conveyed and, for the same reasons as the previous two imputations, defamatory.

3. Imputation (d): This imputation was withdrawn during argument on 16 December 2021.

4. Imputation (e): Acting against the advice of the strata manager is referred to specifically (“most of the time ignored our advice”) and followed by “some examples”. An imputation of doing so recklessly is pleaded. This imputation is conveyed and, in the context of the acts referred to, defamatory.

5. Imputation (f): This is an imputation that the plaintiff is not only ignoring the managing agent’s advice, but doing so incompetently, in that the defendant, by inference, knows better. This imputation is conveyed and defamatory.

6. Imputation (g): The plaintiff is accused of making a “false” accusation of committing an offence. A person who makes an allegation that he or she knows to be false is a liar. This imputation is conveyed and its defamatory nature is self-evident.

7. Imputation (h): Like imputation (c) in the second matter complained of, this is an imputation of a condition, rather than an act. The matter refers to “allegations” in the plural. Mr Lewis challenges whether such an generalised imputation can be conveyed but the plaintiff is entitled to distil an imputation as broadly as the claim put against her, for the reasons enunciated by Gleeson CJ in Drummoyne Municipal Council v Australian Broadcasting Corporation at 137. This imputation is conveyed and defamatory.

Conclusions concerning the imputations

43. Each of the imputations pleaded by the plaintiff for each of the three matters complained of is conveyed and defamatory.

The evidence

44. The plaintiff and her husband gave evidence. The defendant did not give evidence and did not call any witnesses. As a result, most of the factual issues, although convoluted, are not in dispute, and there is no need to set out the usual account of the evidence of witnesses. I have instead set out the events in narrative form, indicating areas of dispute where applicable.

45. Documents from the owners corporation were tendered as part of an agreed Court Book (all references contain the letters “CB” are taken from that source) and, with one exception (a transcript of a strata meeting, although the objection was later withdrawn), were admitted without objection.

46. Evidentiary issues are limited, but each party asked me to draw Jones v Dunkel (Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8) inferences from their opponent’s asserted failure to call witnesses.

The events leading to publication of the matter complained of

47. The events leading to the three publications the subject of these proceedings are as follows. For some years, the plaintiff, a distinguished scientist and academic who retired in about 2006, held roles in the owners corporation for the block of strata units in which her mother lived, where she spent a lot of time visiting as it was near her own home. She was responsible for all owners corporation activities, with the assistance of a managing agent, CF Strata. Another Lot owner, Nina Cruz (also known as Nina King), assisted her from time to time but, in practical terms, management was left by the other owners to the plaintiff to carry out.

48. This management of the building proceeded without complaint or criticism until early 2019, when the managing agent, Mr Cagliata, sent an unlicenced plumber to carry out repairs. He had previously sent someone with the wrong qualifications for some engineering work (Tcpt, 29 March 2023, p 169). The plumbing problems were serious, and the owners agreed this was not acceptable. At the annual general meeting on 4 March 2019 (CB 195 Tab 20), motion 20 (to renew the appointment of CF Strata) was defeated unanimously, with a two-month deferral to enable time to engage a new managing agent. An engineer with the correct qualifications, Mr William Ha, had been called in, and his careful reports of the leak problems (from his visits on 1 and 7 June 2019), covering units 2, 4 and 6 and the outside walls are set out at CB 250 – 254.

49. The new takeover date was to be 7 June 2019 but the plumbing work was urgent and could not wait that long (CB 201 Tab 22.1). The plaintiff instructed the former managing agent, Mr Cagliata, to issue a work order for Purple Plumbing, this company being known to the plaintiff to hold a licence and to have carried out plumbing works in the past to her satisfaction. Purple Plumbing attended promptly and completed the work in relation to their quote, which consisted of checking whether there were water leaks from Lot 4 into Lot 2; on 9 June 2019 they also carried out thermal imaging on Lot 6 and found no water leaks, confirming Mr Ha’s findings. On 17 June 2019 Purple Plumbing provided their invoice to the plaintiff who then sent this on to the defendant on 18 June 2019, which was 11 days after the newly-appointed defendant commenced his duties as managing agent.

50. On 20 June 2019 there was a strata committee meeting at which the plaintiff and MG Strata signed the new Management Agency Agreement (Ms Cruz signed later on). Motion 3 of this meeting nominated Purple Plumbing as the preferred plumber in the future. At the time of the handover, the plaintiff told the defendant that “we were dissatisfied with the tradesmen work and our overseeing it, from the previous managing agency” (Tcpt, 27 March 2023, p 21(47)) and that she wanted to be present when tradesmen came. In addition, if the work was “complicated”, she wanted to see the work after it was finished. In her email of 21 June 2019 to the defendant (CB 272 Tab 36), she explained the difficulties in obtaining properly qualified tradesmen in the past as being the reason for this.

51. On 21 June 2019, the defendant paid Purple Plumbing’s invoice #773 for $2,687.85.

52. Plumbing problems continued and in July 2019, Purple Plumbing returned to investigate water leaks from Lot 11 to Lots 7 and 9, concluding that clogged guttering was the cause. O’Dowd Roofing was engaged to inspect the roof and gutters and they recommended extensive roof work. The defendant sent this report to the plaintiff as an attachment to a note in which he said that “this could be the key to the multiple leaks” (CB 275).

53. For unexplained reasons, the defendant paid Purple Plumbing’s invoice of $2,687.55 a second time on 25 July 2019. Although Mr Lewis described this error as “a simple mistake” which “no one picked up for six months” (submissions, paragraph 45), it was the defendant who made the mistake and the defendant who bore the responsibility of checking the owners corporation accounts to ensure that errors like this did not occur.

54. Meanwhile, on 26 July 2019, the owner of Lot 4 sent the plaintiff photographs of water dripping from the common wall and the owner of Lot 2 sent the plaintiff photographs of water penetration in the garage. O’Dowd Roofing reported that the roof repairs were completed, sending photographs taken on 26 July 2019. The plaintiff emailed photographs to the defendant showing the leaks on 31 July 2019.

55. It is at this same time (Tcpt, 27 March 2023, pp 34 – 35) and against this background of concerns about unqualified tradesmen and poor workmanship that the owner of Lot 7, Ms Candy Lui, made application for renovations to her Lot, providing a signed document stating that she was using licensed tradespeople and builders for her renovation (Tcpt, 27 March 2023, p 52). (It is not in dispute that this is untrue and the builder was unlicensed.) Her application was approved at the 1 August 2019 meeting.

56. The building continued to have water problems. On 8 August 2019, the light fitting in the ceiling of Lot 4 fell out because the ceiling was waterlogged. There was a further owners corporation meeting on 20 August 2019.

57. DJE was called in to provide a quote for Lot 7 and to attend to the water leak problems there. As DJE attended the premises without informing the plaintiff, she told the defendant not to pay them for their visit. The defendant advised that DJE would not charge for this reason, but advised orally that they had found no leaks from their inspection. DJE provided a quote on 11 September 2019 (CB 327).

58. The work on Lot 7 had started, and that included bathroom work such as removing the shower head and taps (CB 340 – 341). Ms Lui complained of water leaks at about this time. The plaintiff obtained a quote from a second plumber to test for water leaks in Lot 7, instructing the defendant to issue a work order for Phillip Kauter, plumber.

59. There was a strata meeting on 4 October 2019. Four days later, Mr Kauter’s invoice was received and it was apparent more work had to be done. On 10 October 2019, the plaintiff sent the defendant a quote from BIM, not for the same price as DJE, but 36% cheaper. In addition, unlike DJE (who had missed this), BIM pointed out that spalling work was necessary because of concrete cancer. It is not in dispute that there was concrete cancer which required treatment. BIM dealt directly with the defendant on this issue, writing to him and providing him with photographs, and they were retained to carry out the work.

60. On 7 November 2019, the defendant’s error in paying Purple Plumbing twice came to the plaintiff’s attention when he admitted this to her (the second payment was refunded on 4 February 2020 according to the defendant, but the plaintiff said Purple Plumbing told her it was refunded in December 2019).

61. BIM carried out the work for Lot 7 in October and on 24 October 2019 the plaintiff approved payment. Then, for no particular reason that she could recall, the plaintiff decided to check the Lot 7 builder’s licence details with the Department of Fair Trading, which she did on 27 November 2019. It was a simple task which she had done before. This was how the plaintiff learned that the “builder” carrying out the work on Lot 7 was not a licensed builder at all, but the unlicensed husband of Lot 7’s managing agent. She immediately told the defendant and put a stop order on the work in the form of a notice to Ms Lui and others.

62. Later that same day the plaintiff attended Lot 7, having been told by her mother that the work was still going on. She knocked on the door and, when admitted, told the tradesman to stop. He rang up for advice. Mrs Nesci, who had been telephoned by the tradesperson working in Lot 7, called the police. Either the plaintiff or Mrs Nesci or both of them (the Minutes of the owners corporation reflect that Mrs Nesci commenced a mediation process there) made a complaint to the Department of Fair Trading. The plaintiff said that she discovered during this process that the electrician retained for this work was also unlicenced (Tcpt, 29 March 2023, p 222(41)).

63. There was a strata meeting on 23 December 2019, where the plaintiff carefully set out these events and obtained permission to represent the owners corporation in the application brought by Mrs Nesci, for the purpose of allowing her unlicensed husband to continue the building work on Lot 7. Mrs Nesci abandoned this application.

64. The defendant wrote to the plaintiff on 4 March 2020 saying there were too many disputes in the building for him to manage and that he was reluctant to take instructions from her in those circumstances. The plaintiff replied the next day, to the effect that the only dispute was with the owners of Lot 7 and the unlicensed builder. This correspondence is important, as it was only after this that the plaintiff and defendant’s relationship began to change.

65. There was a strata committee meeting on 3 April 2020 (CB 398) but this did not deal with strata business other than a DA proposal for an adjoining site; its main relevance was that the Minutes of 23 December 2019 (concerning the unlicensed builder) were accepted as correct. This means that not only the defendant was aware of their contents as recently as a month before publication of the matters complained of but so were the owners and their representatives.

66. During April, the defendant had failed to respond to three requests from the plaintiff for a draft agenda. The plaintiff then discovered that the trust account was out of balance by $618.28 and had been for nine months. The defendant made various adjustments to the accounts in an attempt to make it balance, but continued to be unable to explain how the trust account was out of balance by $618.28. This explanation was eventually provided as part of the second matter complained of, together with an apology for the errors.

67. On 29 April 2020, the plaintiff sent the defendant seven emails, largely concerning the owner’s corporation financial matters, to which he sent four emails in reply. He sent out the AGM agenda that same day. This is also the date of the first matter complained of (this was sent by blind carbon copy to all owners and agents whose email address the defendant had). When the plaintiff continued to press him about the $618.28 shortfall, he sought advice from another office employee, Justine Goldsborough and, the following day, sent the second matter complained of by blind carbon copy. The third matter complained of was sent on 11 May 2020, in the same way.

68. The defendant conducted the AGM via electronic communication. Both the plaintiff and the defendant stated shortly after the meeting commenced that they were recording the meeting; there were no objections. None of the matters of concern to the plaintiff were, she complained, on the Agenda and, when the plaintiff attempted to raise these during the meeting, he muted her, for a total of 33 times.

69. The plaintiff was replaced as Chairman and Treasurer but not as secretary. As the secretary performed most of the work, she would have had to continue to liaise with the defendant. He would not accept this and told the persons at the AGM that he intended to resign.

70. Neither has any association with the building now. The plaintiff’s mother sold her home in December 2021 and went to live in a nursing home (she is now deceased). The defendant ceased to hold the position of strata manager at an unrevealed time.

71. On any reading of the facts, the defendant made a series of unfortunate accounting errors from the time he took office, concerning which the plaintiff initially said nothing. Their relationship spilled over into animosity in the months after a particular event not referred to in the matters complained of occurred. That event was the circumstances in which the plaintiff discovered, on 27 November 2019 (Tcpt, 27 March 2023, p 52), that the Lot 7 “builder”, a Mr Giuseppe Nesci, had no building licence whatsoever. Mr Nesci, who ran a business named “Joe’s North Shore Property Maintenance”, was the husband of Lot 7’s managing agent, Ms Lyndall Nesci. As noted above, this was why, on the afternoon of 27 November 2019, there was a confrontation at Lot 7 and the police were called by the owner’s agent.

72. The plaintiff continued to correspond with the defendant in a courteous manner and the level of invective which crept into their dealings really only became evident after their correspondence of 4 and 5 March 2020. There matters rested until the matters complained of were published and, at the Annual General Meeting on 11 May 2020, the plaintiff was re-elected only as the Secretary.

73. Unlike accountancy errors and double payments, engaging an unlicensed builder was a serious problem for the owners corporation, especially after it was drawn to the attention of the defendant on 27 November 2019. In addition to the risk that the work would not be up to standard (which the plaintiff claims was the explanation for substantial repairs to the Lot 7 floor, which occurred during bathroom renovation), an unlicensed builder would not have had the necessary insurance cover in the event of claims. In addition, permitting the carrying on of building work by an unlicensed builder could result in complaints and/or fines, not only for the builder in question but also for those who, after finding out, turned a blind eye to it, as the defendant (and “our office”, as it is called in the matters complained of) did thereafter. The defendant knew that, only a year before, the owners corporation had sacked their previous strata managers for sending an unlicensed plumber and that the plaintiff had played a large part of that decision, and he knew that the plaintiff had immediately complained to the Department of Fair Trading about the lack of licence.

74. What exactly were the defendant’s duties and obligations to the office-holders and Lot owners to take steps such as keeping correct accounts and checking the licences of tradesmen?

The relevant legislation for strata plans and managing agents

75. The management of strata plans in New South Wales is regulated by the Strata Schemes Management Act 2015 (NSW) (“SSMA”). This is outlined in Mr Rasmussen’s submissions at paragraphs 49-62 and summarised by Smith SC DCJ in Gough v Squillacioti [2021] NSWDC 411 at [29]-[32].

76. The duties of strata managing agents are set out in the Property and Stock Agents Act 2002 (NSW) (“PSAA”) at ss 3B(1), 8(1), 32(1), 86(1), 103(3) and 104(1)(a). The Property Stock and Business Agents Regulation 2014 (NSW) (“Regulation”) imposes further obligations on the defendant. Mr Rasmussen has set these out in his submissions at paragraphs 83-88 and 89-99 respectively.

77. Although the parties did not address me on the legislation requiring building work to be carried out by licensed and insured builders (Home Building Act 1989 (NSW) ss 3 (“dwelling”), 4, 10 and 92(1)(a)), the parties agreed that, for all relevant purposes, that the Lot 7 building work commenced by Mr Nesci after its approval at the 1 August 2019 strata meeting was work that was carried out by an unlicensed builder who had, it would appear, carried out work in the bathroom, such as removal of the shower head and the taps. As set out in the 23 December 2019 minutes, the plaintiff stated that the negligence of this renovation work was a contributing factor to the floor of Lot 7 requiring the substantial rectification that it did. This is the Act referred to by the plaintiff at the Annual General Meeting (CB 579) when she describes the meetings she says the Department of Fair Trading had with both Mrs Nesci and Mr Roberts, in which they were told that using an unlicensed builder would amount to a breach of this legislation.

78. There have been some amendments to this legislation (for example, the Regulation referred to is the historical version for the period 31 October 2018 to 22 March 2022), but these are of no consequence.

79. The importance of this legislation is that it underlines the seriousness of having an unlicensed builder carrying out work, particularly if damage to the building is having to be rectified, as was the case with BIM. Keeping accurate financial records is also a matter for which the strata manager, rather than the committee he advises, is responsible, as the manager is in charge of paying tradesmen and keeping the books.

How did it come about that an unlicensed builder carried out substantial renovations in the building?

80. As noted above, on June or July 2019, Lot 7 made applications for renovations in the Lot (Tcpt, 27 March 2023, p 34(39)-35(3)). The owner of Lot 7 had (Tcpt, 27 March 2023, p 52(32)-(34)) signed a document saying that she was using licensed tradespeople and builders for her renovation. The proposed renovations were considered by the strata committee on 1 August 2019 (CB 298 Tab 46) and approved at the strata committee meeting on 20 August 2019 (CB 303 Tab 49; Tcpt, 27 March 2023, p 35(5)-(7)).

81. Mr Rasmussen states, at footnote 44 to his written submissions, that the Court Book does not contain copies of these minutes of meeting. The parties have, however, located the By-Laws for the Strata, which clearly identified that where “major works” (i.e. involving plumbing, electricity and the like: clause 2.1(j)) were carried out, the owner seeking permission of the owners corporation had to “use duly licensed employees, contractor or agent [sic]” (Part 3.3(a)). Insurance was also required (clause 2.1(h)).

82. The plaintiff prepared minutes of the 1 August 2019 meeting and sent them to the defendant. She later realised the defendant was not sending copies of her minutes of strata committee meetings to owners (except for the last one before the AGM in May 2020), which meant that apart from the one other person who attended the meetings, the other owners did not know what was going on.

83. There were ongoing plumbing problems at the building and in September 2019, the owners of Lot 7 advised new problems, at a time when they were renovating the bathroom and kitchen. It was in these circumstances that the plaintiff discovered that Mr Nesci was in fact unlicensed:

“Q. Now, how did you find out that this person did not have a building licence?

A. Yeah - because beforehand, I - I don't know exactly what precipitated it, but I have a tendency, if I find out what the company name is, to check - to - and the name of a person is - to check that they have a licence.

Q. And how do you --

A. It would be nice if I'd checked the licence--

Q. How did--

A. --a lot earlier.

Q. How did you check and how did you do this checking of the licence?

A. On fair trading. You can look up the company ABN number or something or rather, and it tells you who's running the company. And then, I found out it was Mr Gillespie Nesci and then, I looked up to see if he was a licence builder under that name and he wasn't.

Q. Okay.

A. I could've checked this earlier but one assumes that and also, Candy Lui, the owner, had signed a document saying that she was using licenced tradespeople and builders for her renovation. So I'd believed that. I believed that and I was very upset and quite annoyed that I have to gone through all this, the builder and the tradespeople may not have had licences for all this work that had been done.” (Tcpt, 27 March 2023, p 52 (10)-(33))

84. In an email on 27 November 2019 at 12:38 PM (CB374 Tab 62.4), the plaintiff instructed the property managers and owner of Lot 7 to cease all renovation work because the builder engaged by them did not have a building license. The text was as follows:

“Dear Ms Lyndal Nesci and Mr Kirk Roberts

Investment Property Managers

I have just found out that Mr Giuseppe Nesci, the individual sole Trader ABN 92 147 414 660 of "Joe's North Shore Property Maintenance" who has been engaged by Lyndal Nesci and Kirk Roberts to do renovations at Unit 7 25 Cook St Randwick, appears not to have a building licence.

All renovation work at 7/25 Cook St Randwick must stop immediately and until below details are supplied.

Please supply any licence numbers and names for all workers and tradespersons who are working on renovations at Unit 7 at this time or will work in the future asap.

Thank you

Marlene Read”

85. The plaintiff gave her reasons for doing this as follows:

“Q. Why did you send this?

A. Well, I was pretty annoyed at this stage after all we'd been through with unit 7. To find out that the actual builder was the husband of Lindall Nesci and that he - his company was Joe's North Shore Property Maintenance but he did not have a building licence which is absolutely essential in our by law for works. That anyone who does works in their own unit or anywhere else must have a licence. And he did not have a building licence. And I don't know if the owner actually knew that, but certainly, Lindall Nesci, it was her husband, she must've known that he didn't have a licence.

And I was quite annoyed about that which is why I said, "All renovations at unit 7 must stop immediately until the licenced names of any tradespeople subcontract, et cetera are known." Because they were doing things to the kitchen. There's plumbing, there's electrical which are very important matters. So, you know, I was extremely annoyed and asking for all information as to stop work until we found out that information.

Q. Now, how did you find out that this person did not have a building licence?

A. Yeah - because beforehand, I - I don't know exactly what precipitated it, but I have a tendency, if I find out what the company name is, to check - to - and the name of a person is - to check that they have a licence.” (Tcpt, 27 March 2023, p 51(47)-p 52(12))

86. Mrs Nesci and Mr Roberts, despite being property managers themselves, took a combative approach to the plaintiff’s discovery of the lack of licence from the start. They had already written to the defendant refusing to deal with the plaintiff. Dr Read’s email of 27 November 2019 objected to this process:

“Dear Ms Lyndal Nesci and Mr Kirk Roberts, Investment Property Managers and Mark

The Owners Corporation's interests and finances, that are administered by the Strata Committee with advice from the Strata Manager, Mark Gitman, cannot financially afford to make payment to the Strata Manager for the large number of phone and email interactions that are required by him to deal with Lyndal Nesci and Kirk Roberts and others concerning matters associated with the renovation of Unit 7 at 25 Cook St Randwick.

It is not at all reasonable for the above investment property managers to state to me: "Please do not email us directly anymore, we will only look at emails that come from the strata agent" (Mon, Oct 21,2019 at 2: 27PM) and then later send an email to me requesting a reply from me by 'close of business' the same day that they send the email (Mon, Nov 18, 2019 at 10:01 AM) as well as try to cut the Strata Committee out of its duties and responses with respect to renovations.

For financial reasons as noted above and other reasons, you must now continue to only send emails or make phone calls to the Chairperson of the Strata Committee, that is me, and not to the Strata Manager at all. The strata Manager will not read any of your emails or phone calls from now on, including if you 'cc' him on emails to me.

The Strata Manager will only advise the Strata Committee (not you) when the Strata Committee asks for his advice and will not read emails or receive phone calls at all from Lyndall Nesci and Kirk Roberts or others to do with the renovations at 7/25 Cook St Randwick.

The Strata Committee at 25 Cook St Randwick is in charge of and oversees all repairs, alterations, additions and renovations at 25 Cook St Randwick and follows the " Special By‐Law for Works " 2012 of Strata Plan 2533.

Thank you.

Marlene Read”

87. A copy of this email and another of similar content was also sent to the owner, Candy Lui. The second email, of the same date (CB 375) referred them to the Strata Committee’s role as set out in the special By-Law for Works 2012.

The police are called late on 27 November 2019

88. Later on the same day, the plaintiff’s mother saw someone entering Lot 7 and informed the plaintiff that tradesmen were present at Lot 7 (Tcpt, 29 March 2023, p 226(49)-(50)). The plaintiff came to the premises to tell them to stop and the police were called. The defendant places great weight on the asserted wrongdoings of the plaintiff on this occasion in relation to both credit and damages, and full details of this incident are set out in the section of this judgment on credit.

89. The plaintiff gave unchallenged evidence that she reported the carrying on of unlicensed building work (which continued even after she had directed it to stop (Tcpt, 30 March 2023, p 292(27)-p 293(23)), to the Department of Fair Trading (Tcpt, 29 March 2023, p 220(20)-(23)). She told the Court that it was investigated (Tcpt, 29 March 2023, p 220(20)-(23)) and Tcpt, 29 March 2023, p 219(5)-(9), CB 660 Tab 115, lines 29 to 36).

90. Although her evidence on her discovery of there being no licence and complaining to the Department are unchallenged, the evidence concerning the calling of the police is not. In his submissions, Mr Lewis asks me to prefer the “evidence” of Mrs Nesci’s version of events, provided in an email to the defendant a year or more later after these proceedings were commenced, (MFI 5), although this email was never tendered. Allegations that the plaintiff not only attacked the tradesman and resisted arrest but tried to hide these wrongful acts from the court are made in cross-examination and in submissions as a basis for not accepting the plaintiff as a witness of truth.

91. For the reasons set out in the section of this judgment on credit, I have accepted the plaintiff as a witness of truth and accepted her version of events. She robustly denied the versions of events given by Mrs Nesci and I accept her evidence.

92. Mr and Mrs Nesci were not called to give evidence about these (or any other) events, and neither was the unnamed tradesperson. There is no evidence of their being unavailable. No attempt was made to tender MFI 5 and it is not therefore in evidence: Boulas v Angelopoulos (1991) 5 BPR 11,477 at 11488 per Kirby P. In those circumstances, it is not strictly necessary for me to draw a Jones v Dunkel inference from the failure to call these witnesses. I am, however, prepared to draw such an inference from the failure of the defendant to call them, or to tender documents demonstrating the state of Mr Nesci’s licence or the “police report” the owner of Lot 7 told the other residents at the AGM on 11 May 2020 that she had in her possession.

93. There is no evidence of the defendant taking any steps to comply with the resolutions passed at the 23 December 2019 meeting. As the plaintiff stated in her correspondence and at the AGM, the complaints to the Department of Fair Trading, the state of the licence and the continued renovations simply vanished into thin air at the AGM.

The events concerning Lot 7 after 27 November 2019

94. The plaintiff wrote to the defendant on 29 November 2019 as follows:

“Dear Mark

Please note that the Strata Committee and me are now handling all correspondence and phone calls to deal with the owner and her representatives, and "builder" and any of the "builder's" workers and also companies/workers engaged by the OC and SC at Unit 7 /25 Cook St Randwick.

The "builder", Mr Giuseppe (Joe) Nesci of "Joe's North Shore Property Maintenance”, recommended by real estate agent Ms Lyndall Nesci, and his workers are not licensed to do the work that they have been assigned to do by Mr G. Nesci at Unit 7 and this is contrary to the "Special By‐Law No 1 for Works" for SP 2533/25 Cook St Randwick.

Please do not complicate matters by interacting with any of these people connected with the renovation of Unit 7/25 Cook St Randwick at this time.

Thank you

Marlene Read” (CB 376)

95. The plaintiff also told the defendant she would attend the proceedings in the Department of Fair Trading (CB 377).

The meeting on 23 December 2019

96. The Minutes of Meeting of 23 December 2019, a meeting which was only attended by the plaintiff and Ms Cruz (Unit 12), set out the difficulties the owners corporation was having with the intransigent property managers of Lot 7, including the plumbing problems resulting from these unlicensed and incompetently performed works, and advised of complaint proceedings (actually instituted by the owners and managing agents for Lot 7), resulting in a Fair Trading Mediation Session, set for 24 January 2020.

97. The text of these Minutes is as follows:

“Unit 7 Renovations

The Owner of Unit 7 employs Ms Lyndall Nesci (Principal) and Mr Kirk Roberts (Senior Property Manager) from “Investment Property Managers”, Neutral Bay, to organize her unit renovations and lease her property for rent. These Property Managers recommended that the owner of Unit 7 engaged Mr Giuseppe (Joe) Nesci of “Joe’s North Shore Property Maintenance”, Dee Why, to provide a Quote and Scope of Works for the renovation that is well over the threshold of $20,000.00 that requires a licensed builder and appropriate Fair Trading-approved contract and other legally required documents.

The owner undertook that no common property would be altered or interfered with in her renovation by signing the correct “Annexure C” form for renovation works according to the “Special By-Law No 1 for Works” 2012 of Strata Plan 2533.

There have been many problems with this renovation.

On August 30 the Chairperson of the Strata Committee (SC) was notified by the above property managers that the subfloor in Unit 7 was damaged and needed replacement before they could lay new flooring and continue the renovation. This damage was due to water penetration, contra-indicated concrete-“repair” and removal of kitchen common-property-tiles by the owner.

Up until 25 September, the owner and property managers agreed with the SC Chairperson, that an Owners Corporation (OC) plumber should check all hot and cold water pipes and the shower floor for leaks, before the common property subfloor in the rest of the unit (except laundry and bathroom) was repaired and renovation started. (The hot water heater and pipes that can cause water leakage, had already been checked by an OC plumber a few months before in July.) A plumber’s Report at a cost of $638.00 to the OC stated that there were no leaks at this time. This was necessary for the OC (and also beneficial to the owner) to ensure that there was no OC liability if the proposed new floor and cupboards were subsequently damaged from common property pipe/shower floor water leaks.

Unit 7’s subfloor was damaged by the owner by un-authorized and extensive multiple contra-indicated “wet” concrete patching of magnesite common property subfloor that does more damage to the floor and causes concrete cancer, also un-authorized concrete patching of a large crack in the north common property north wall near kitchen sink and dishwasher that can cause water penetration. The removal of common property tiles in the kitchen common property floor was also un-authorized. There are photos of all these damages.

The property managers have also admitted that they arranged for the re-configuring of the owner’s hot water heater and pipes in Unit 7 without complying with the requirements of the “Special By-Law No 1 for Works” 2012.

Following 25 September, of the quotes obtained for the OC’s repair of the unit’s subfloor, only one (which was also $2,000.00 cheaper) provided a Contract that was legally required for works over $5,000.00. Acquiring the contract, (“BIM Remedial Building Maintenance”), arranging progress payments, jackhammering the removal of the damaged subfloor and re-levelling (cost $6,435.00) and then finding extensive concrete cancer and repairing that (extra cost $4,950.00 or total cost $11,385.00) took 37 days or 27 working days not the 64 days that the investment property managers are stating. This common property subfloor work was finished on 2 November 2019. Twenty seven working days is not an excessive time for undertaking this type of work. If the owner needed rental loss protection for her renovation she should have taken out appropriate Owner’s Insurance. All the above statements are backed up by many photographs and the dates by many, many email exchanges (that were costly to OC finances).

The Owners Corporation and its finances have suffered from the owner’s unpermitted damage and alteration to common property including faulty and extensive contra-indicated wet concrete “repairs” to the magnesite subfloor, faulty and unpermitted “concrete repair” to large crack in common property north wall adjacent to kitchen sink and dishwasher, removal of common property tiles in the kitchen floor, removal of common property tiles in north kitchen wall above kitchen sink and dishwasher, large holes gouged by extreme force on cement of north wall near kitchen common property water pipes: this last action renders the recent OC plumber’s Report and pressure test of water leaks in unit pipes at a cost of $638.00 now useless in protecting the liability of the OC against further costs from damage due to leaks from common property pipes. All of these above works were done without approval from the Chairperson or any Strata Committee or the OC as is required.

It has been found that Mr Giuseppe (Joe) Nesci has no Builder or Tradesperson license from Fair Trading.

An owner of a lot in a strata scheme must not carry out work on the common property unless the owner is authorized to do so-

STRATA SCHEMES MANAGEMENT ACT 2015 - SECT 111

Work by owners of lots affecting common property

111 Work by owners of lots affecting common property

An owner of a lot in a strata scheme must not carry out work on the common property unless the owner is authorised to do so—

(a) under this Part, or

(b) under a by-law made under this Part or a common property rights by-law, or

(c) by an approval of the owners corporation given by special resolution or in any other manner authorised by the bylaws.

STRATA SCHEMES MANAGEMENT ACT 2015 - SECT 132

Rectification where work done by owner

132 Rectification where work done by owner

(1) The Tribunal may, on application by an owners corporation for a strata scheme, make either of the following orders if the Tribunal is satisfied that work carried out by or for an owner or occupier on any part of the parcel of the scheme has caused damage to common property or another lot—

(a) an order that the owner or occupier performs the work or takes other steps as specified in the order to repair the damage,

(b) an order that the owner or occupier pay to the owners corporation or the owner of the lot a specified amount for the cost of repairs of the damage and any associated costs, including insurance and legal costs.

(2) An amount payable by an owner or occupier to an owners corporation under this section is payable, and may be recovered, under this Act as if it were an amount of unpaid contributions.

Note: Section 86 provides for the recovery of unpaid contributions.

The owner of unit 7 and her investment property managers, as above, were instructed on 27 November 2019 by the Chairperson of the SC to immediately arrange to stop and suspend all their renovation work and that permission to continue with it was withdrawn for a period. This was because extra repair work needed to be done by OC tradespeople with respect to a large crack in the western common property wall. This was also very necessary because of the above damage to common property and their engagement of trade work exceeding $5,000.00 and also $20,000.00 by the apparently unlicensed workers or, instead, to supply to the Chairperson the Builders/Tradespersons names and licence numbers. They did not comply with these instructions.

Written Complaints were sent last week to “NSW Fair Trading” concerning the apparent unlicensed and possibly dangerous trade work performed on Owners Corporation’s common property and owner’s property during this renovation in Unit 7 that is to be leased out for rent.

The owner and her employed investment property managers are concerned about the owner’s loss of rental income that they did not plan for, because of the damaged common property subfloor in Unit 7. The owner apparently does not have owner’s insurance to off-set her loss of rental income. They also have claimed that the OC tradespeople (BIM) have damaged the owner’s property and the Chairperson of the Strata Committee charges that the owner’s workers have damaged and interfered with common property without permission as well as done apparently unlicensed work in the unit.

269. The defendant had no significant problems with the plaintiff until he wrote to her on 4 March 2020 saying that he had difficulty taking instructions from her because of the many disputes she had with the other owners in the building. When the plaintiff replied on 5 March 2020 saying (correctly) that the only dispute between the owners corporation and herself was the ongoing dispute with Lot 7 over their unlicensed builder, the defendant had to find another way to deal with the plaintiff, so he chose the path of attack.

270. The defendant’s desire to protect himself from the consequences of his incompetence led him to accuse, falsely to his knowledge, the plaintiff of wrongdoing when he in fact was responsible for these problems. This was the dominant improper purpose of each of the three matters complained of. By sending the matters complained of blaming the plaintiff, he managed to leave consideration of these errors out of the AGM meeting agenda and every time she tried to explain things (in fact, 33 times) at the meeting, he muted her.

Conclusions concerning malice

273. I am satisfied that the defendant, who knew of the falsity of the allegations as set out above, sent the three matters complained of for the dominant improper purpose described above, namely to protect himself from the consequences of his actions by falsely blaming the plaintiff for wrongdoings she had not committed. This was a sustained campaign of multiple accusations in three separate publications. This motive is clear evidence of malice which defeats the defence of common law qualified privilege in relation to each of the publications.

274. In the event that I have erred in my finding as to what the dominant improper purpose was, I note that in Lesses v Maras at [195] and in Machado & Anor v Underwood & Anor at [141] observations were made that malice may still be found even where there is inability to identify the precise motive.

275. A good example of this problem occurred in Coles Myer Limited v Webster; Coles Myer Limited v Thompson [2009] NSWCA 299, where a sales assistant called the police and accused the plaintiffs (fairly obvious members of the LGBTQ+ community) of fraudulent conduct. The trial finding of malice by reason of ill-will was upheld on appeal, largely because the obvious falsity of the allegation, but it was never clear where the ill-will came from or why the shop assistant would have taken such an extraordinary step after a few minutes of conversation with the plaintiffs. In the ensuing decade, thanks to social media, the phenomenon of shop assistants calling the police because of vindictiveness or prejudice against persons of colour, the intellectually disabled and/or LGBTQ+ has become widely recognised, but only after a series of respectable members of the community found themselves the target of such conduct, not only from shop or hotel employees, but also on occasion from the police. Similarly, in Lassanah v State of New South Wales (No. 3) [2010] NSWDC 241, police stopped and searched a black social worker and his intellectually disabled patient after shop assistants called police immediately after they came into the store. The plaintiffs were awarded damages for false imprisonment but an award for defamation was set aside on appeal as there was no evidence of malice or improper motive.

276. Cases such as these demonstrate that defining the improper motive may in some cases be genuinely difficult. The decisions of Lesses v Maras at [195] and Machado & Anor v Underwood & Anor at [141] would still permit a finding of malice where the motive is unclear. Where the defendant does not give evidence, the court should also be entitled to take that factor into account. Accordingly, if I have erred in my determination of what the improper motive is, or there is insufficient evidence of it, malice can still be made out.

Justification

277. The defendant pleads the defence of justification to imputation 4(d).

278. In the weeks leading up to 29 April 2020, the plaintiff had sent emails to the defendant asking for an explanation of the apparent shortfall in the accounts. In his written submissions, Mr Lewis states (at paragraph 35 of his outline of submissions) that the defendant had attempted to communicate with the plaintiff “orally” but this failed and therefore he had to spend what is called “an excessive amount of time” responding to her in writing:

“Mr Gitman reasonably attempted to orally communicate with Ms Read about that matter. That attempt failed. Mr Gitman therefore had to spend an excessive amount of time responding to Ms Read’s emails in writing.”

279. When was/were these attempts, and why did they fail? Mr Lewis’s reference to “that attempt” suggests that only one attempt was made. He stated at paragraph 37 of the outline:

“Mr Gitman will seek to establish at trial that the emails he received from Ms Read between 29 April and 6 May 2020 were unnecessary and caused him to spend an excessive amount of time responding to them.”

280. The first matter complained of inconsistently demanded that “everything should be in writing from this point” while claiming that the plaintiff unnecessarily emailed the defendant “at least 12 times over the issue that could have been clarified in 5 minutes phone call [sic]”.

281. The plaintiff’s cross-examination on this issue did not deal with all the correspondence between 29 April and 6 May 2020 but focussed largely on the claim that her complaints could have been dealt with in a five-minute phone call. She was not cross-examined about the defendant having “attempted” to contact her in the manner described in the outline of submissions.

282. The defendant did not give evidence.

283. As Mr Rasmussen points out in his submissions, from April 2020 onwards, the plaintiff’s concerns were many. First, the defendant had not replied to four requests during April to prepare a draft agenda. Second, he had not responded to her concerns about the shortfall in the accounts. There was undoubtedly a shortfall, and there was no explanation until the second matter complained of, dated 7 May 2020, when the defendant admitted to the bookkeeping errors that caused the shortfall and apologised to everyone.

284. Mr Lewis’s submissions (paragraph 35) paint a different picture. He asserts that, as at 6 May 2020, the defendant had written to the owners of Lots in the building information concerning the AGM, including the Notice of AGM, which was accompanied by financial statements for the building, the inference being that there was nothing wrong with these financial statements. The plaintiff’s complaint is not described as being concern over the errors for which the defendant later apologised but as being about “the way in which Mr Gitman had recorded specific information” and that she “sought to have Mr Gitman amend them before they were sent to owners”. When he did not amend the accounts, the plaintiff sent further emails which are described as being “threatening in tone”, such as asking for an explanation “in terms that a Public/Chartered Accountant would understand” or “in terms that…NCAT would understand.”

285. The 11 emails exchanged between the plaintiff and the defendant on 29 April 2020 are set out in Appendix 2 to Mr Rasmussen’s submissions. I agree with his submission that they should be considered in their entirety.

286. First of all, the plaintiff did not send “at least 12” emails. She sent 7 emails and received 4 replies. How the material in the emails on 29 April 2020 could have been reduced to a five-minute phone call was never explained. I am satisfied it is a knowing untruth.

287. Nor is it the case that answering these emails was costing, or did cost, the owners corporation funds in the first place. Mr Rasmussen points out in his submissions:

“311. Under the terms of the agency agreement, the defendant was paid by the owners corporation for two types of services: (i) The Agreed Services (defined at CB 242 Tab, 27 and set out on CB 246 Tab 27), were paid as a flat fee of $3,080 per annum (CB235 Tab 27); (ii) The Additional Services,(defined at CB 242 Tab, 27 and set out on CB 247 Tab 27), were charged at an hourly rate set out in Schedule B – Fees (CB Tab 27, p. .248): $154.00 for the strata managing agent and $66.00 for administrative staff. Additional Services fees are also known as Schedule B fees.

312. If the responses of the defendant on 29 April 2020 to the plaintiff’s emails fell under Agreed Services then there was no additional charge to the owners corporation for them (T213.17-33).

313. If the responses of the defendant on 29 April 2020 to the plaintiff’s emails fell under Additional Services, then the charge must have been invoiced to the owners corporation by the defendant and there must be a record of the payment in the financial accounts of the owners corporation.

314. The defendant has supplied the Detailed Expenses document for the period 1 May 2019 to 31 July 2019 (CB 816-9 Tab 128). The Additional Services charged by the defendant in this period are shown on page 817 under Admin - Management Fees - Additional as a charge on 1 July 2019 for additional services June 2019 for $61.44.

315. The defendant has not supplied the Detailed Expenses document for April/May 2020 which would have shown the Additional Services charge, if any, for the 29 April 2020 email exchange.”

288. No evidence has been provided that Additional Services Fees were charged by the defendant for the reading of the plaintiff’s seven emails and his four responses to the plaintiff’s emails on 29 April 2020 or, for that matter, for the emails between 29 April and 6 May 2020 (the period of time nominated in the defendant’s opening submissions), or subsequently. Mr Rasmussen submits that I should draw a Jones v Dunkel inference from the failure of the defendant to supply the detailed expenses for the relevant period, which is unexplained. While I would accept that any such expenses information would be in the possession of third parties, the plaintiff’s employment and association with this owners corporation having long since ceased, some form of calculation of these costs incurred by the plaintiff’s conduct should have been attempted.

289. Nor were any of the emails “unnecessary”. The plaintiff was entitled to be concerned about inconsistencies in the financial records, particularly given the circumstances that she, and not the defendant, had discovered the shortfall and where there had been earlier financial problems, such as paying Purple Plumbing twice.

290. Mr Lewis refers me to Stocker v Stocker [2020] AC 593; [2019] UKSC 17 (in which the Supreme Court explained that an unduly legalistic approach should not be taken to social media publication) and to the endorsement of those principles in a series of Australian decisions which go beyond the social media context. It is certainly the case that a degree of elasticity should be employed when dealing with the evidence necessary to establish justification arising from a relatively informal email.

291. However, in the present case, no amount of elasticity could permit a plea of justification to succeed. There is no evidence whatever to establish the truth of any of the elements of the imputation. Each of the matters raised in the plaintiff’s emails was an entirely proper matter for her to have raised and, given the incompetence the defendant had shown in his management of the accounts on the earlier occasions referred to above, she was entitled to express herself in strong language in doing so.

292. The defence of justification to imputation 4(d) accordingly fails.

Conclusions concerning liability

293. I have found that each of the matters complained of conveys each of the imputations pleaded, and that each of them is defamatory.

294. The matters were published on an occasion protected by the defence of qualified privilege at common law. The defence has, however, failed for each of the matters complained of by reason of the plaintiff having discharged the onus of proof to the Briginshaw standard of establishing malice in relation to each of them.

295. The defence of justification to imputation 4(d) has not been made out.

296. The plaintiff is entitled to judgment and to the determination of damages appropriate for each of the three publications.

Damages

297. The plaintiff claims damages, including aggravated damages. The defendant brings a plea in mitigation.

298. The purposes of an award of damages for defamation are "consolation for the personal distress and hurt caused to [the plaintiff] by the publication, reparation for the harm done to [the plaintiff’s] personal and (if relevant) business reputation and vindication of [the plaintiff’s] reputation": Carson v John Fairfax & Sons Ltd (1993) 178 CLR 44; [1993] HCA 31 at 60 per Mason CJ, Deane J, Dawson and Gaudron JJ. The task for the Court is to identify all of the relevant factors, to assess their significance and to make an evaluative judgment as to the appropriate award conformably with the Act.

299. The Court is to ensure that there is an appropriate and rational relationship between the harm sustained by the Applicant and the amount of damages awarded: s 34 of the Act.

300. Section 35 of the Act provides for a maximum amount of damages for non-economic loss that may be awarded in defamation proceedings. The maximum amount of damages that can be awarded for non-economic loss is $459,000 from 1 July 2023 (Government Gazette No 250 of 22 May 2023, n2023-0927).

301. Although there are three publications, care must be taken to avoid “double dipping” and the approach to the award of damages is for this to be one sum representing all publications, conformably with s 39 of the Act, whether there are only two publications, as occurred in Pavlovic v Karzon [2023] QCA 37 or as many as 28: Gayle v Fairfax Media Publications Pty Ltd (No 2) Gayle v The Age Company Pty Ltd (No 2); Gayle v The Federal Capital Press of Australia Pty Ltd (No 2) [2018] NSWSC 1838. Where only three of publications are involved, it is not necessary to carry out the careful analysis embarked on by McCallum J (as her Honour the Chief Justice of the Supreme Court of the Australian Capital Territory then was) in this judgment.

302. The heads of damage claimed by the plaintiff are:

1. The plaintiff’s distress and the reasons for it: Mr Rasmussen relies upon several passages between Tcpt, 27 March 2023, pp 76 and 81. This is addressed for each of the matters complained of.

2. The effect of the publications on the plaintiff’s behaviour: Mr Rasmussen points to the plaintiff’s description of the profound impact of the publications (Tcpt, 28 March 2023, p 163) as well as to the observations of her husband (Tcpt, 30 March 2023, pp 298-309). The very serious impact on both her emotional and physical health was also evident while she was in the witness box, as is set out in the transcript. I will not distress the plaintiff by setting this out in detail, but the impact of the publications has clearly been both severe and prolonged.

3. The effect the publication has had on others: As well as telling the plaintiff not to sue, Mrs Byrnes told her that she was going to take over in the future to get the strata back on track and did not want the plaintiff at her elbow. In addition, Mrs Byrnes was the person who, when seeing the plaintiff at the auction of her mother’s unit in December 2021, said “Oh, here they come now. The troublemakers.” (Tcpt, 28 March 2023, p 126). She noticed changes in the behaviour of Nina Cruz, Larry Vincent and Randall Magro, all of whom distanced themselves from her and avoided her.

4. Her worry about this litigation (Tcpt, 28 March 2023, p 165): It has been an ordeal for her to prepare documents. Her husband confirmed this (Tcpt, 30 March 2023, p 307).

5. The impact on her position and standing: The plaintiff had been acknowledged not only nationally but internationally as a physicist. She had been a member of the Australian Institute of Physics and the American Physical Society (APS Physics) as well as the author of many scientific publications during her long career as a senior lecturer at the University of New South Wales. Imputations of the kinds of misconduct she was accused of by the defendant was very damaging to her reputation generally, as being truthful as a scientist (even after retirement) is as important as honesty is for a member of the legal profession (Crampton v Nugawela (1996) 41 NSWLR 176 at 192-3).

6. The defendant’s failure and refusal to apologise: The plaintiff sent two requests for an apology prior to commencing proceedings, both of which were ignored. Her husband said that what she really wanted was an apology, not a court case, so that she could show people she was not guilty of what she had been accused of: Tcpt, 30 March 2023, p 308.

The extent of publication

303. The defendant admits that all three publications were made to occupants as well as some strata managers of tenanted premises of a building, in the course of preparing for the AGM. A list of 18 email addresses appears at CB 821, but other persons such as Mrs Sue Byrnes clearly had read it; I could not see Mrs Nesci or Mr Knight’s email addresses, and assume that their information came via Ms Lui or their companies. Mr Rasmussen points out that eight of these addresses are to companies where other persons in the office may have read the matters complained of.

304. The defendant claims that evidence of publication is merely “inferential” and that the cautions expressed in David v Abdishou [2012] NSWCA 109 at [286]-[287] should be applied (submissions, paragraph 5). Mr Lewis notes that in Ell v Milne (No.8) [2014] NSWSC 175, McCallum J determined that “considerably fewer” persons than the total number to whom an email was published would have read the email the subject of these proceedings.

305. I do not agree that the case is inferential. Each email had a dramatic headline in bold type. The defendant referred several times to his emails at the AGM (“If you go through my emails” at CB 657) and summarised their contents (CB 657); the plaintiff, in seeking to answer them during the meeting, referred them as being sent to “poison the well” (CB 706). I am satisfied, from the plaintiff’s description of her conversation with Mrs Byrnes, that she and others had read and discussed them. There might be an inferential case that others would have read this correspondence such as the incoming strata manager or potential purchasers inspecting the strata records, but Mr Rasmussen did not put this, seeking only to rely on the grapevine effect.

306. Nevertheless, the defendant submits that the damages will be at the very low end of the scale referring to similar factual circumstances: Murray v Raynor at [96] ($25,000, as an alternative finding), Gough v Squillacioti at [71] ($25,000 excluding aggravation, as an alternative finding); Matthews v Pigram [2020] NSWDC 526 at [59] ($20,000 as an ex parte assessment); and Balzola v Passas [2020] NSWSC 896 at [253] ($10,000 for one slander).

307. Mr Rasmussen refers to the grapevine effect, which Campbell J noted in Balzola v Passas at [252] “can be difficult to measure”, adding that this difficulty “itself requires restraint in assessment”. There is no direct evidence of any ongoing reputational damage beyond statements made by Mrs Byrnes and the plaintiff’s perception of the reactions of other owners, such as on the day of the auction of her mother’s unit, although I accept she continues to fear repetition of the sting of the insult. Her reputation is to be vindicated but, as Campbell J went on to note, the dominant compensatory principle is established by s 34 of the Act, namely that the amount of damages is to be calculated for the purpose of ensuring an appropriate and rational relationship between the harm suffered and the damages awarded.

308. In the present case, the plaintiff told the Court that she lived quite near to her mother’s unit and that she visited her regularly. She was concerned that the matters could be repeated in her neighbourhood. She ran into the other residents while she continued to visit her mother for the period up until sale in late 2021. She was also concerned that other strata managers who knew the defendant would have heard about her. She took a position on her own strata and was worried because of a professional connection between that company and the defendant.

303. Mr Lewis particularly relied upon the similar factual circumstances in both Murray v Raynor and Gough v Squillacioti because both cases involved disputes between neighbours, in circumstances where the extent of publication did not go beyond those neighbours. Both these judgments are of little assistance, for the following reasons.

304. First, the difficulty in applying the observations on damages in Murray v Raynor is that the Court’s observations (which were alternative findings) on damages were bound up in its acknowledgement that the assessment of damages in other jurisdictions was being conducted on a very different (and, as was later acknowledged, correct) basis, but without indicating whether the Court accepted that view or would proceed with the different approach in jurisdictions other than New South Wales. The findings in Gough v Squillacioti were also alternative findings and were correspondingly brief.

305. A much better analogy than these cases, in terms of the circumstances, extent and number of publications as well as the date when these were made, may be found in Pavlovic v Karzon, where the nature and extent of publication was very similar. The Court of Appeal dismissed an appeal from an award of $70,000 damages (including aggravated damages) and an injunction for the publication of two emails to eight persons. In the course of dismissing the appeal, Bradley J stated:

“[59] In addressing this court for the applicants, Mr Gilbertson KC submitted there were two further matters that demonstrated his Honour’s findings on malice were erroneous. The first was the limited circulation of the two emails, being sent only to the manager, the five committee members, the two directors of Wandulla, and its solicitor. The second was that Ms Pavlovic honestly believed Mr Karzon had been conducting an illegal brothel.

[60] Ms Pavlovic’s limited publication of the emails does not indicate malice. Had she posted them on social media, malice might be inferred on that basis. However, the limited publication is not a basis for setting aside the trial judge’s factual finding that Ms Pavlovic acted with the improper purpose of harming Mr Karzon’s reputation.”

312. Although these observations were addressed to malice rather than damages, they confirm the importance of not treating defamation actions generally as a “numbers game”. The trial judge’s assessment of damages was so correctly carried out that it was not the subject of appeal.

313. This brings me to the second concern in applying Murray v Raynor, namely that, in terms of the basis for assessment, Payne JA considered there was very little evidence of damage to reputation, in that only one witness had said that he had “wondered” about the damage to the plaintiff’s reputation.

314. It is something of an oversimplification to treat any a defamatory publication to a small group of neighbours as a trivial or minor claim merely because of that fact. This includes basing the damages on the number of persons who give evidence that they thought less of the plaintiff. In reality, the difficulty in obtaining witnesses who will speak frankly about thinking less of the plaintiff, in terms of damage to reputation, is widely known (Bauer Media Pty Ltd v Wilson(No 2) at [515]). In addition, damage to reputation is not necessarily linked to extent of publication. Speaking about serious harm rather than damages, Dingemans J, in Sobrinho v Impresa Publishing SA [2016] EWHC 66 (QB); [2016] EMLR 12 at [47] noted that “[r]eported cases have shown that very serious harm to a reputation can be caused by the publication of a defamatory statement to one person”.

315. Extent of publication is but one of many factors in damages. Implicit in submissions that local and limited publications are trivial is the inference that the “big damages” awards somehow belong only to trials involving media publications read by hundreds of thousands and usually involving a famous (or infamous) plaintiff. To my observation, most defamation actions are now brought for social media or email posts where the content, extent of publication and lack of fame of the parties closely resemble “neighbourhood dispute” defamations. However, others do not share my view. In Do v Kolsumdet Pty Ltd [2023] FCA 592 at [10], Bromwich J stated that defamation actions that were of a “neighbourhood dispute” nature (as opposed to
     celebrities such as Geoffrey Rush or Ben Roberts-Smith), should be brought in the lower courts, and that he would “need some persuading that it was suitable for the Federal Court” to hear the applicants’ case. However, these proceedings have been brought in this court, which is well suited to hear claims of the kind which are not suitable for the Federal Court, and the concerns expressed by Bromwich J have no application here.

316. It would be easy to dismiss the matters complained of as being an angry outburst from the defendant that the plaintiff should have put behind her. However, she was clearly profoundly affected by these events; the evidence her husband gave painted a graphic picture of her suffering a range of health issues where she has refused to see the doctor despite sight and hearing issues, total withdrawal, spending days in bed and other symptoms that clearly deeply worry him. This was not just one offensive email, as was the case in Murrayv Raynor, but three, and the evidence of ongoing adverse response from the Lot owners was still occurring at the end of 2021, as the events at the auction show. The fact that she was re-elected as secretary suggests that some of the recipients of the publication may not have believed everything that the defendant said, but may also have been for other reasons, such as the desire to provoke the resignation of an incompetent and argumentative strata manager. The plaintiff does not appear to have anything to do with the other Lot owners after the AGM and I assume this is because despite re-electing her, they displayed the unfriendly behaviour she described in her evidence. There is also evidence of the grapevine effect, such as the conduct of other residents at the auction.

317. At the same time, substantial allowance must be made for the limited extent of publication, the degree of seriousness of the imputations and the circumstances of publication, namely an owners corporation email about the AGM in circumstances where conduct of this kind is more likely to be expected than not. These are powerful factors, putting the damages at the bottom of the range.

318. Taking all of the above into account, and having regard to submissions from counsel, there should be an award sufficient to console the plaintiff, but it should be towards the bottom end of the range of damages appropriate.

Aggravated damages

319. The plaintiff claims aggravated damages on the following bases:

1. The defendant’s failure to give the plaintiff any reasonable opportunity to respond to the allegations before they were published.

2. The plaintiff’s hurt to feelings was increased by the knowledge that the defendant knew that the imputations were false.

3. The defendant’s failure to apologise.

320. It is sometimes appropriate to consider each of the publications individually, in the event that one or more of the matters may warrant aggravated damages but not another. However, the same factors apply to all three, so I will consider them in a group.

321. In Pavlovic v Karzon, no challenge on appeal was brought to the award of aggravated damages. A key factor was failure to apologise, in that the defendant failed to retract the defamatory imputations or apologise for them for nearly four years, whereas an apology had been accepted by the plaintiff from another publisher. While all cases must turn on their own facts, the way in which the trial judge approached the task of assessing aggravated damages (which was not disturbed on appeal) is helpful. If anything, the factors in this case are stronger, in that the defendant did not send the emails because he was angry, but because he wanted everyone to believe that the mistakes in the administration of the owners corporation were mistakes made by a person other than himself. I am also satisfied that he wanted to punish the plaintiff out of petty spite because she had picked up mistakes that he had made, including the fact that Lot 7’s builder was unlicensed.

322. By denying the plaintiff the chance to answer the allegations, he caused the plaintiff great hurt, as she was unable to defend herself either in answering the correspondence or at the subsequent AGM. Her knowledge of the falsity of the allegations made them particularly hurtful, as her very distressed behaviour at the AGM and in her evidence shows.

323. The plaintiff made two requests for an apology from the defendant before commencing these proceedings. It was important for her to clear her name. I consider the failure to apologise was wrongful because the defendant knew what he had said was false, and thus is a basis for aggravated damages.

324. The plaintiff is entitled to an award of aggravated damages for all three publications on all three bases put forward by the plaintiff. Conformably with Bauer Media Pty Ltd v Wilson(No 2), this lifts the cap on general damages.

325. Such an award must still be made consistently with the facts of the case, and a substantial sum is not warranted for such a limited publication in terms of the number of persons who saw it and the harm done.

The impact of MFI 5 on damages

326. The defendant relies, in mitigation of damages, on the evidence led in support of the defences. Mr Lewis relies upon “the truth of any imputations which were found to be substantially true and also the evidence before the court directed to a plea of justification”, citing Fairfax Media Publications Pty v Kermode (2011) 81 NSWLR 157 at [86]; Pamplin v Express Newspapers [1988] 1 WLR 116 at 120; Prager v Times Newspapers Ltd [1988] 1 WLR 77 at 93 (submissions, paragraph 42).

327. A defence of justification was pleaded only to one imputation, imputation 4(d), and that defence failed. However, Mr Lewis also submits that a defendant is also entitled to rely in mitigation on evidence that was before the Court on an unsuccessful, or partially successful, plea of justification: Holt v TCN Channel Nine Pty Ltd (2014) 86 NSWLR 96 at [26]-[32].

328. None of the evidence in relation to the unsuccessful plea of justification revealed any factor capable of mitigating the damages. MFI 5 is inadmissible and I prefer the answers in cross-examination given by the plaintiff to any other evidence or document asserted to undermine this.

329. Mr Lewis also submits that the fact that the plaintiff took the owners corporation to the Civil and Administrative Tribunal after the 11 May 2020 AGM “would have had more of deleterious [sic] effect on her reputation than the matters complained of”, adding that it is “instructive to note that despite being personally acquainted by many of the owners and agents in the Building, not one gave evidence on her behalf.” (submissions, paragraph 82).

330. The claim that the plaintiff’s reputation suffered damage in the eyes of the recipients of the matter complained of by reason of this second cause is similarly without foundation. As is made clear by the minutes of meeting of the owners corporation, it was in fact Mrs Nesci and Mr Roberts who initially went to Fair Trading to complain about Mrs Nesci’s husband not being permitted to carry out building work because he was unlicensed. The plaintiff agreed to attend the scheduled mediation but Mrs Nesci and Mr Roberts then cancelled the mediation. The fact that the plaintiff, later brought further proceedings so that she could clear her name is directly related to the matters complained of.

331. Nor do I accept that the plaintiff had a reputation as a “troublemaker” independently of the matters complained of, or the submission by Mr Lewis that this was because of the incident with the police on 27 November 2019 (submissions, paragraph 82); if there was one topic which would not have been raised at an auction where a good sale would reflect on other units, it would be the circumstances in which renovations by an unlicensed builder had been permitted by the owners corporation, an event the owners and defendants were careful to keep off the agenda and out of discussion at the 11 May 2020 meeting. Any reputation the plaintiff had as a troublemaker occurred after, and as a direct result of, the matters complained of, and the litigation that followed. I am satisfied that, prior to that, as she said in her letter of 5 March 2020 to the defendant, there were no disputes or other issues between her and the other owners, save for the Lot 7 unlicensed builder issue, and I note those items of correspondence from the other owners which are in the Court Book were, previously, uniformly polite and friendly.

Conclusions concerning damages

332. Comparable awards of damages are often described as being of little assistance, and should be treated with caution because each case turns on its own facts.

333. Applying the relevant principles for the assessment of damages, even allowing for the removal of the cap by reason of my finding on aggravated damages, the amount to be awarded should be modest, in order to take into account the factors set out above. In the circumstances the sum I propose to award, inclusive of aggravated damages, is $35,000.

Injunctive relief

334. Neither the plaintiff nor the defendant have any further connection with the building. The plaintiff’s mother’s unit was sold in December 2021. The plaintiff gave no evidence of any continuing activity on the strata committee after the 11 May 2020 AGM. The defendant ceased having any connection with the building at about the same time. There is no evidence the defendant has made any statements about the plaintiff to any third party since the AGM.

335. In Carolan v Fairfax Media Publications Pty Ltd (No 7) [2017] NSWSC 351, McCallum J stated (at [13] to [15]):

"So far as I am aware, the proposition that a permanent injunction should ordinarily accompany an award of damages following the unsuccessful defence of a common law claim is unknown in any other field. The court would not, without more, make an order restraining the unsuccessful defendant in a professional negligence or motor vehicle accident claim from acting negligently in the future. I accept that the analogy is imperfect but it is appropriate to test what appears to be a premise of the plaintiff's argument. I do not think it can be said, without qualification, that the restraint of speech -even indefensible speech - necessarily or ordinarily serves the public interest.

Nor can it be said, without qualification, that the public interest is "not offended" by the restraint of indefensible defamation. The public interest is offended by any court-imposed restraint that is not reasonably necessary in the circumstances. It is tempting to think that is particularly so in the case of injunctions to restrain publication, since such orders necessarily impair or take away a person's freedom of speech. Upon reflection, however, it is difficult to articulate any principled basis for placing defamation in a special category in this context; any restraint of ordinary freedom imposed by order of the court warrants the same caution.

In my view, as a matter of principle, the critical factor in determining whether to grant a final prohibitory injunction in aid of a claim for defamation should be an assessment of the existence and degree of any threat or risk of a repeat of the publication of the defamatory matter successfully sued on in the proceedings. Such an order should only be made where the court is satisfied that the order is reasonably necessary to address that threat or risk."

336. Although her Honour’s remarks were addressed to a media publisher who had removed the matters complained of as soon as the jury findings were handed down, the same principles should apply here.

337. No permanent injunction will be granted.

Orders:

1. Judgment for the plaintiff for the first, second and third matters complained of in the sum of $35,000.

2. Costs reserved.

3. Liberty to apply in relation to costs and interest.

4. Exhibits retained until further order.

**********

Amendments

25 August 2023 - typographical errors in paragraphs [49] and [101]

Decision last updated: 25 August 2023