Rivkin v Nationwide News Pty Limited (ACN 008 438 828)

[2002] NSWSC 798

CITATION:	Rivkin v Nationwide News Pty Limited (ACN 008 438 828) [2002] NSWSC 798
FILE NUMBER(S):	SC 20532/00
HEARING DATE(S):	4/9/02
JUDGMENT DATE:	6 September 2002
PARTIES :	Rene Rivkin (Plaintiff) Nationwide News Pty Limited (Defendant)
JUDGMENT OF:	Bell J at 1

COUNSEL :	T.D.F. Hughes (Plaintiff) T.D. Blackburn (Defendant)
SOLICITORS:	Gilbert & Tobin (Plaintiff) Gallagher De Reszke (Defendant)
DECISION:	The defendant is to provide answers to the plaintiff's interrogatories numbered 4(a) & (b) and 5; The plaintiff is to give further and better discovery within seven days of documents within the classes described in paragraphs (1) - (11) in the defendant's letter of 11 April 2002; The plaintiff is to answer the whole of the defendant's interrogatories numbered 7; The plaintiff is to pay the defendant's costs of the defendant's motion

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

BELL J

6 September 2002

20532/00 Rene RIVKIN v NATIONWIDE NEWS PTY LIMITED, (ACN 008 438 828)

JUDGMENT

1 BELL J: By notice of motion filed on 28 May 2002 the plaintiff sought an order that the defendant provide responsive answers to the plaintiff’s interrogatories numbered 4(a) & (b), 5 and 6.

2 By notice of motion filed on 8 July 2002 the defendant sought orders that the proceedings be dismissed for failure to comply with the court’s order that the plaintiff answer interrogatories (in the alternative, that the proceedings stand dismissed if the plaintiff failed to deliver answers to the defendant’s interrogatories within seven days) and that the plaintiff give further and better discovery within seven days.

3 Both motions were listed for hearing on Wednesday 4 September 2002. The defendant was ordered to file written submissions by 5:00 pm on 2 September and the plaintiff to respond to the same by 5:00 pm by 3 September. In the event no written submissions were filed in accordance with the timetable.

4 When the matter came on for hearing I was informed that the parties had by agreement resolved the matters the subject of the plaintiff’s notice of motion. The defendant has agreed to the provision of responsive answers to the plaintiff’s interrogatories 4 and 5. In the light of that agreement the plaintiff no longer presses for an answer to interrogatory 6.

5 Since the filing of the defendant’s motion on 8 July last I was told that the plaintiff had provided answers to the interrogatories served on him. Thus, the defendant sought orders in somewhat different terms to those set out in its notice of motion. Mr Blackburn, who appeared on the defendant’s behalf, took issue with the sufficiency of the plaintiff’s answer to interrogatory 7. He sought an order that the plaintiff provide a verified answer to the balance of interrogatory 7.

6 On the hearing of the motion Mr Blackburn refined the terms of the order sought for discovery conformably with Part 23 r 3 of the Supreme Court Rules 1970. The defendant seeks discovery of documents falling within the classes described in subparagraphs (1) – (11) of a letter by its solicitors addressed to the plaintiff’s solicitors dated 11 April 2002.

7 The matter complained of comprises two articles published in “The Australian” on 6 October 2000. The plaintiff pleads two imputations arising from the same:

“(a) That the plaintiff as an investment advisor had acted dishonestly in that he sold certain stocks while recommending, without disclosing such sales, that readers of his publication, ‘The Rivkin Report’, should buy such stocks;
(b) That the plaintiff, in order to promote demand for stocks that he desired to sell, dishonestly recommended to readers of his investment advisory newsletter, ‘The Rivkin Report’, that they should buy such stocks.”

8 A hearing pursuant to s 7A of the Defamation Act 1974 has been conducted. On 9 October 2001 the jury found that each of the imputations were conveyed and that they were defamatory of the plaintiff.

9 The defendant by its amended defence pleads a defence of comment with respect to publication in each of the Australian jurisdictions.

10 The particulars of the material upon which the comment is said to have been based are set out in paragraphs (l) and (m) of the amended defence as follows:

“(l) The investigation carried out by ASIC pursuant to Part 3 of the Australian Securities and Investments Commission Act 1989 and the outcome of that investigation;
(m) By reference to the numbering of the schedule to the statement of claim, lines 21 – 26; 30 – 45; 63 –65; 81 –83; 94 – 98; 104 – 106.”
During the course of oral argument Mr Blackburn informed me that the defendant also relies upon the material in lines 3 – 10 and 28 and 29 of the schedule in support of its defence.

11 The ASIC investigation and its outcome is the matter of public interest identified by the defendant as being proper material for comment. The matters set out in (m), together with the further matters noted in [10] above, are the facts which the defendant contends to be substantially true and upon which it based its comment.

12 The plaintiff has served a list of documents and a supplementary list of documents. The documents discovered comprise:

(i) The matter complained of;

(ii) The pleadings;

(iii) The enforceable undertaking made pursuant to s 93AA of the Australian Securities and Investments Commission Act 1989;

(iv) A media release titled “ASIC accepts enforceable undertaking from Rene Rivkin and companies”;

(v) Copies of correspondence between solicitors;

(vi) A bundle of issues of the “Rivkin Report”.

13 The defendant complains that the plaintiff’s discovery to-date is incomplete. By its solicitor’s letter of 11 April 2002 the defendant identified classes of documents relevant to the factual matters which it must prove as follows:

(b) The factual matters contained in the matter complained of as indicated in the defence.
These factual matters include the following, and you should discover all documents relating to them:
1. The statement by ASIC that it believes the plaintiff and his publication ‘The Rivkin Report’ may have mislead and deceived subscribers.
2. The acceptance by ASIC of enforceable undertakings from your client and his related companies after a nine month investigation.
3. The restriction of Rivkin Stockbroking Pty Limited to the execution of trades requested by clients, and not providing advice.
4. The agreement by your client, Tarfaya Pty Limited to restrictions on share trading stock.
5. All documents related to the activities of your client and his related interests in the trading of Abednego Nickel Limited, Holyman Limited, FAI Insurances Limited, Murrin Murrin Investments Pty Limited and Infratil Australia Limited in the period between April 1998 and June 1999.
6. The sale of shares in those companies during that period.
7. The recommendation by ‘The Rivkin Report’ of purchase of those stocks in that period.
8. The performance of those stocks in or about that period.
9. The enforceable undertaking.
10. Profits made by the plaintiff or his interests in relation to the purchase and sale of the above stocks.
11. All additions of the ‘Rivkin Report’ from April 1998 to June 1999.

14 There was no controversy concerning items (1) – (4), (7), (9), and (11). Mr Hughes, who appeared on behalf of the plaintiff, informed me that the plaintiff has discovered all documents falling within those seven classes.

15 In Mr Hughes’ submission there is a degree of overlap between classes (5) and (6). The plaintiff accepts that documents evidencing the trades are properly discoverable and he will discover the same. Mr Hughes submitted that otherwise the scope of (5) is too broad. Documents related to the plaintiff’s activities and his related interests in the trading of the named companies in the period between April 1998 and June 1999 is said not to be relevant to any issue in the proceedings. In this respect he noted that the defendant does not plead a defence of truth.

16 Mr Hughes submitted that categories (8) and (10) are also irrelevant to the issues between the parties.

17 Mr Blackburn observed that, while it may not be thought to assist the defendant’s case, the material upon which the comment is based includes at lines 44 and 45 a statement that persons who followed the plaintiff’s tips would have made money according to the ASIC because the shares rose in the aftermath. The defendant will seek to prove this fact along with the other facts upon which it based its comment.

18 Generally, Mr Blackburn drew attention to lines 104 –106 of the matter complained of:

“Apart for Abednego, ASIC also found that Rivkin sold, or was in the process of selling, stock in Holyman, FAI Insurances, Murrin Murrin Investments, and Infratil Australia while recommending to his subscribers that they buy these shares between April 1998 and June 1998.”

19 Elsewhere in the matter complained of there is reference to the plaintiff trading in Abednego Nickel and four other recommended stocks (lines 25 and 26); the ASIC investigation is said to have begun after the ASX noticed the plaintiff steadily selling 3.8 million shares in Abednego Nickel in November 1998. Regulators are said to have uncovered similar activities in four further stocks – FAI Insurances, Murrin Murrin Investments, Holyman, and Infratil (lines 35 – 40).

20 The defendant must prove the facts upon which its comment is based if it is to succeed upon its defence of comment. I accept Mr Blackburn’s submission that the defendant is entitled to seek to prove the facts upon which it relies in any legitimate way open to it. In those circumstances it seems to me that the defendant has made good its contention that is should have discovery of the documents falling within each of the classes described in subparagraphs (1) – (11) of the letter of 11 April 2002.

21 In his written submissions Mr Blackburn contended with respect to particular (l) that “the investigation carried out by ASIC and its outcome, the facts of the investigation and its outcome, the facts of that investigation and its outcome must also be proved”. Although at the commencement of the oral argument Mr Blackburn identified the order that he sought with respect to discovery in the terms set out in [6] above, he did go on to state that the ASIC inquiry was a matter in issue as between the parties and that the defendant sought discovery “in relation to the ASIC Report”. To the extent that this latter submission sought to identify documents in addition to those falling within the classes described in subparagraphs (1) – (11) of the letter I am not persuaded to order discovery.

22 Mr Blackburn submitted that in a number of the jurisdictions in which the defence of comment is pleaded the Court will look to ensure that the comment, to the extent that it carries with it an imputation of dishonesty or other dishonourable conduct, was one that was warranted. Such a requirement does not apply in New South Wales by reason of s 30(4) of the Defamation Act. Mr Blackburn referred me to Gatley on Libel and Slander, 9th ed, Sweet & Maxwell at 12.24 ff for the position at common law. In his written submissions Mr Blackburn went on to assert “the defendant wishes to prove the whole circumstances of the enquiry, what it investigated, what it found, and the undertakings agreed to by the plaintiff”. I do not understand that acceptance of the submission that at common law the Court may look to whether the comment was warranted on the facts proved widens the ambit of discovery. The defendant must prove the facts upon which the comment was based. Those are particularised in the amended defence and, relevantly, identified in classes (1) – (11) of the letter of 11 April 2002.

23 Mr Hughes submitted that it was premature for the defendant to seek a direction requiring the plaintiff to answer the balance of interrogatory 7. The material sought thereby will be answered by discovery of the documents in category (6) above. Mr Hughes did not seek to contend that the interrogatories objected to in 7 are not relevant to the issues between the parties. It does not seem to me to be to the point that the defendant may be able to prove the matters the subject of them independently of any answers given by the plaintiff.

24 Mr Hughes submitted that to require an answer to the balance of interrogatory 7 was oppressive in that the defendant’s interrogatories exceed thirty in number. I do not consider that the interrogatories served are oppressive by reason of the number of them.

25 I propose to make orders reflecting the parties’ agreement concerning the interrogatories served on the defendant. This was the subject of the plaintiff’s notice of motion. Mr Hughes foreshadowed that there was an issue as to costs arising out of the plaintiff’s motion. In the event no submissions were directed to this issue. I propose making no order at this time as to the costs of the plaintiff’s motion.

Orders

(i) The defendant is to provide answers to the plaintiff’s interrogatories numbered 4(a) & (b) and 5.

(ii) The plaintiff is to give further and better discovery within seven days of documents within the classes described in paragraphs (1) – (11) in the defendant’s letter of 11 April 2002.

(iii) The plaintiff is to answer the whole of the defendant’s interrogatories numbered 7.

(iv) The plaintiff is to pay the defendant’s costs of the defendant’s motion .

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Last Modified: 09/06/2002