Sarina v O'Shannassy (No.5)
[2020] FCCA 2911
•30 October 2020
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SARINA & ANOR v O'SHANNASSY (No.5) | [2020] FCCA 2911 |
| Catchwords: DEFAMATION – Whether an email sent by the company secretary of a company to the two directors of the company conveyed defamatory imputations of two of the shareholders of the company – whether defences of statutory and common law qualified privilege applied – whether defence of “triviality” established – defence of triviality established – judgment for respondent. |
| Legislation: Defamation Act 2005 (NSW), ss.8, 25, 26, 28, 29, 30, 31, 33, 34 |
| Cases cited: ABC v Obeid [2006] NSWCA 231 |
| First Applicant: | CLINTON SARINA |
| Second Applicant: | MARTIN GREEN |
| Respondent: | JOHN O'SHANNASSY |
| File Number: | SYG 1339 of 2018 |
| Judgment of: | Judge Manousaridis |
| Hearing date: | 15, 16 and 17 April 2020 25 and 26 May 2020 and 1 July 2020 |
| Date of Last Submission: | 1 July 2020 |
| Delivered at: | Sydney |
| Delivered on: | 30 October 2020 |
REPRESENTATION
| Counsel for the Applicants: | Mr R Rasmussen, by video |
| Solicitors for the Applicants: | Kalantzis Lawyers |
| Counsel for the Respondent: | Mr T Crispin, by video |
| Solicitors for the Respondent: | Lloyd & Lloyd Solicitors |
ORDERS
Judgment for the respondent.
By 13 November 2020 the parties file and serve written submissions on the question of costs together with such affidavits, if any, on which they intend to rely.
By 20 November 2020 the parties inform the associate to Judge Manousaridis whether they wish to supplement their written submissions by oral argument or whether they agree to the question of costs being determined on the papers.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 1339 of 2018
| CLINTON SARINA |
First Applicant
| MARTIN GREEN |
Second Applicant
And
| JOHN O'SHANNASSY |
Respondent
REASONS FOR JUDGMENT
Introduction
The applicants, Mr Sarina and Mr Green, claim the respondent, Mr O’Shannassy, defamed each of them by sending an email on 20 December 2017 (Email) to the two directors of a company known as Fleur de Vie Beverages Pty Ltd (FDV). Mr O’Shannassy admits he sent the Email, but denies the Email conveyed the imputations Mr Sarina and Mr Green claim the Email conveyed; and he relies on a number of affirmative defences, assuming the Email did convey one or more of the alleged imputations.
Mr O’Shannassy sent the Email in the course of a deteriorating relationship with each of Mr Sarina and Mr Green. That relationship evolved in connection with a water bottling business FDV had been established to pursue; but it began to deteriorate after Mr O’Shannassy, at the request of Mr Green, lent $35,000 to Mr Sarina for a purpose unconnected with FDV’s business, when a dispute arose about the terms on which Mr O’Shannassy lent the $35,000 to Mr Sarina. Another factor that contributed to the deteriorating relationship was Mr Green’s not repaying to Mr O’Shannassy $500 he lent to Mr Green for purposes also unconnected with FDV’s business.
I will first set out the evidence of the events that led to Mr O’Shannassy’s sending the Email. Some of the evidence consists of email communications. Much of the evidence, however, consists of testimony of conversations and of the testifier’s state of mind. I will set out the evidence of these conversations and of the testifier’s state of mind at the appropriate point of the narrative, and there consider whether I should accept all or any of the evidence, and record my findings. Unless the context suggests otherwise, any unqualified statement of fact I make is to be taken as a finding of the fact stated. I will then consider whether the Email conveyed the alleged imputations and, to the extent it did, consider each of the defences on which Mr O’Shannassy relies.
Evidence and findings
Before I consider the evidence and record my findings, there are two matters I should note in relation to my assessment of the evidence. First, I have set out elsewhere the approach I take to assessing evidence;[1] and I have attempted to follow that approach in the assessment of the evidence in this case. Second, much of the evidence Mr Sarina, Mr Green, and Mr George have given has not been challenged in cross-examination, and counsel for Mr O’Shannassy has not made submissions against my accepting a number of aspects of their evidence. Subject to the requirements of procedural fairness,[2] however, I am not bound to accept evidence that is not challenged in cross-examination.[3] As Newton J said in Bulstrode v Trimble:[4]
[I]f a witness’s evidence upon a particular matter appeared in his evidence-in-chief to be incredible or unconvincing, or if it was contradicted by other evidence which appeared worthy of credence, the fact that the witness had not been cross-examined would, or might be of little importance in deciding whether to accept his evidence.
[1] Kassem & Ors v Minister for Immigration & Anor (No.2) [2020] FCCA 1834, at [29]-[33], [37], [38]
[2] Such as the principle of fairness underlying the rule in Browne v Dunn (1893) 6 R 67
[3] Bulstrode v Trimble [1970] VicRp 104; [1970] VR 840, at page 848; Ellis v Wallsend District Hospital (1989) 17 NSWLR 553, at pages 587-588; Elkington v Shell Australia Ltd (1993) 32 NSWLR 11, at pages 15 and 17-18; Caldwell v JA Neilson Investments Pty Ltd [2007] NSWCA 3, at [96]; Masterton Homes Pty Ltd v Palm Assets Pty Ltd [2009] NSWCA 234, at [105]
[4] Bulstrode v Trimble [1970] VicRp 104; [1970] VR 840, at page 848
November 2016 – initial discussions for water project
A convenient starting point is the conversation Mr O’Shannassy says he had with a Mr MacFarlane in around November 2016. Mr O’Shannassy was then and continues to be a solicitor; and Mr MacFarlane was an acquaintance of Mr O’Shannassy. Mr MacFarlane asked whether Mr O’Shannassy knew of anyone who could provide water for bottling. Mr MacFarlane said Mr Green had a scheme to sell pure Australian water to markets in Australia and China. Mr O’Shannassy knew Mr Green. They met in 2008 through an association with the Manly Warringah Junior Rugby Union, but they did not maintain a relationship after that time. Mr O’Shannassy told Mr MacFarlane that a colleague of Mr O’Shannassy, Mr Versace, had a friend who has a property in Jindabyne with a good supply of fresh water. Mr O’Shannassy said he would ask Mr Versace, and Mr O’Shannassy would arrange a meeting.[5]
[5] J O’Shannassy affidavit 07.04.2020, [5], [6]
Shortly after his conversation with Mr MacFarlane, Mr O’Shannassy arranged a meeting with Mr Green and Mr Versace in late November 2016. It was agreed that Mr Versace would speak with an associate of his, Mr Nastevski, to obtain details of Mr Nastevski’s water licence, and that all three would visit Mr Nastevski’s farm in Jindabyne (Jindabyne property). Mr Green said that he has a colleague, Mr George, with whom he has had a good business relationship, and who will be able to assist. Mr Green said he would organise a meeting with Mr George.[6]
[6] J O’Shannassy affidavit 07.04.2020, [7]
In December 2016 Mr O’Shannassy, Mr Green, and Mr Versace travelled to the Jindabyne property. They inspected the spring, and discussed a proposal to sell spring water sourced from the Jindabyne property.[7] Later in the month, Mr Green introduced Mr Sarina to Mr O’Shannassy in Brookvale. According to Mr O’Shannassy, Mr Green said that Mr Sarina was going to assist in raising funds “for the water project”, noting “[h]e has contacts, he is a financing guy”.[8] Again according to Mr O’Shannassy, there was a general discussion “about the proposed water project”. Neither Mr Sarina nor Mr Green refer to any such discussion with Mr O’Shannassy in their affidavits of 10 March 2020, and neither Mr Sarina nor Mr Green has made an affidavit responding to Mr O’Shannassy’s affidavit. I therefore accept Mr O’Shannassy’s evidence on these matters.
[7] J O’Shannassy affidavit 07.04.2020, [8]
[8] J O’Shannassy affidavit 07.04.2020, [9]
December 2016 – agreement to form FDV
In December 2016 Mr O’Shannassy, Mr Sarina, Mr Green, Mr George, and a Mr Coleman met at a hotel in Kent Street. The participants agreed that a company would be registered to conduct a “proposed water project”, Mr George and Mr Coleman would be appointed directors, and Mr O’Shannassy would be appointed company secretary. The participants also agreed that shares in the company would be issued to Mr O’Shannassy.[9] FDV was registered in January 2017.
[9] J O’Shannassy affidavit 07.04.2020, [10], [11]; A D J George affidavit 10.03.2020, [4], [5]
By 14 February 2017 some work had been done in relation to the proposed water business. The work was summarised in an email Mr George sent to Mr Coleman, Mr O’Shannassy, Mr Green, and Mr Sarina on 14 February 2017.[10] This included Mr O’Shannassy and Mr Green “working together on an operational costing, to determine required capital expenditure for infrastructure set-up on the property”. In evidence given in cross-examination, Mr George said that “[t]he intent was . . . ultimately to sell bottled water, but at its conception, it was to explore an opportunity that had been presented in relation to commercialisation of water”.[11]
[10] Exhibit “O”, pages 1-2 (Exhibit “O” being the same as exhibit “JOS-H1” described in J O’Shannassy affidavit 07.04.2020)
[11] 17.04.2020 T82.5
March 2017 – Mr O’Shannassy lends $500 to Mr Green
On about 23 March 2017 Mr Green requested Mr O’Shannassy lend him $500. Mr Green said he would repay the amount by 4 April 2017. Mr O’Shannassy agreed to and did lend Mr Green $500.[12] Mr Green did not repay the $500 loan, despite Mr O’Shannassy having demanded that he do so.[13]
[12] J O’Shannassy affidavit 07.04.2020, [23]
[13] J O’Shannassy affidavit 07.04.2020, [23]-[25]
June 2017 – Mr O’Shannassy lends Mr Sarina $35,000
According to Mr O’Shannassy, in June 2017 he met Mr Green several times. On more than one of those occasions Mr Green told Mr O’Shannassy he had a property development project in Caboolture in Queensland, and he asked whether Mr O’Shannassy was interested in investing in the project. Mr O’Shannassy said he did not have money to invest at that moment.[14] Mr Green does not refer to any such discussion with Mr O’Shannassy in his affidavit of 10 March 2020, and Mr Green has not made an affidavit responding to Mr O’Shannassy’s affidavit. I therefore find that Mr Green and Mr O’Shannassy had conversations to the effect Mr O’Shannassy deposes in his affidavit.
[14] J O’Shannassy affidavit 07.04.2020, [26]
Again according to Mr O’Shannassy, in late June 2017 Mr Green telephoned Mr O’Shannassy several times requesting that he lend Mr Sarina money. Mr Green told Mr O’Shannassy he should make a short-term loan to fund a project in Queensland, which later became known as the “West Caboolture project”.[15] A short time later Mr Green and Mr O’Shannassy met at the Brookvale Hotel. Mr Green said that a funder had dropped out, and that “[w]e need money to secure an option for the purchase of the West Caboolture project”. Mr Green said: “Can you help me and Clinton out with a loan? It is only short term you will have your money back within a month”.[16] Mr O’Shannassy says that, following these discussions, he “relented”, and agreed to lend $35,000 to Mr Sarina. Mr Green does not refer to any such discussion with Mr O’Shannassy in his affidavit of 10 March 2020, and Mr Green has not made an affidavit responding to Mr O’Shannassy’s affidavit. I therefore find that Mr Green and Mr O’Shannassy had conversations to the effect Mr O’Shannassy deposes in his affidavit.
[15] J O’Shannassy affidavit 07.04.2020, [27]
[16] J O’Shannassy affidavit 07.04.2020, [28]
It is not in dispute that Mr O’Shannassy lent $35,000 to Mr Sarina. The evidence about when and how the loan was made, and the terms on which it was made, is sparse. In his affidavit of 7 April 2020 Mr O’Shannassy says the “terms of the loan agreement were confirmed in an email from Mr Green to myself dated 25 August 2017”.[17] Mr O’Shannassy exhibits to his affidavit a copy of the email he sent on 25 August 2017.[18] Although the email refers to a loan of $35,000, it cannot accurately be characterised as confirming the terms of a loan. That is apparent from the contents of the email which I reproduce later in these reasons.
[17] J O’Shannassy affidavit 07.04.2020, [29]
[18] Exhibit “O”, page 18 (Exhibit “O” being the same as exhibit “JOS-H1” described in J O’Shannassy affidavit 07.04.2020)
Mr Sarina does not refer to the loan of $35,000 in his affidavit. He did give some evidence about the loan under cross-examination. Mr Sarina was asked whether he borrowed money from Mr O’Shannassy in 2017. Mr Sarina said that “rings a bell”, and “Yes, from my recollection”.[19] Mr Sarina said he was “unaware of negotiations between Mr Green and Mr O’Shannassy, regarding the $35,000”, and he had “no input in the negotiations, at that stage”.[20] Mr Sarina said it was not a loan for him; the $35,000 “was put . . . into an account of mine, but it was not for me. It was for a company I had, at the time. A project that I had at the time, and . . . which I’m still working on”.[21] Mr Sarina accepted that Mr Green had approached Mr O’Shannassy for a potential loan for Mr Sarina; and he accepted Mr Green arranged a short-term loan of $35,000. Mr Sarina said, however, that all he knew was that Mr Green “was negotiating a . . . short-term loan through his friend, Mr O’Shannassy at the time”; and that the loan was advanced to him “without any phone call; any discussion; any paperwork being signed or executed. It just appeared in my account . . . it was only then that a loan agreement came . . . sometime later”.[22] Mr Sarina later said that Mr Green was aware Mr Sarina required $35,000 for a property development in Queensland; Mr Green said he would try and raise that money; and that Mr Green told Mr Sarina that he had organised $35,000 from Mr O’Shannassy and Mr Sarina needed to pay it back as soon as possible.[23]
[19] 25.5.2020 T11.5
[20] 25.5.2020 T11.10
[21] 25.5.2020 T11.15
[22] 25.5.2020 T11.25-T12.10
[23] 25.05.2020 T14.5
Mr Green also does not in his affidavit of 10 March 2020 refer to his participating in any discussion with either Mr Sarina or Mr O’Shannassy about a loan from Mr O’Shannassy to Mr Sarina; and he has not made an affidavit responding to Mr O’Shannassy’s affidavit. Under cross-examination, however, Mr Green accepted there was an agreement for a loan of $35,000 from Mr O’Shannassy to Mr Sarina; it was a relatively short-term loan “for a couple of months, I think”; and an interest component of $15,000 was discussed, but Mr Green was not sure if it was formalised.[24]
[24] 16.04.2020 T19.1-T19.20
By around 30 June 2017 Mr O’Shannassy drafted an agreement in relation to the $35,000 loan; and it also appears he provided the draft to Mr Green. That is apparent from two items of evidence. The first is an email Mr O’Shannassy sent to Mr Sarina’s lawyer on 7 November 2017 to which he attached what Mr O’Shannassy described as “the agreement (unsigned) but orally agreed to by Clinton Sarina”.[25] The second item of evidence is the email Mr Green sent to Mr O’Shannassy on 25 August 2017 to which I refer below, which refers to an agreement Mr O’Shannassy had drafted.
[25] Exhibit “Q”, being the affidavit of Mr O’Shannassy made on 16 March 2018 filed in the Local Court, at page 4. There is an attachment described as “Loan_agreement__OShannassy to Sarina_300617.pdf”
25 August 2017 – Mr Green informs Mr O’Shannassy further time is needed to repay $35,000 loan
By 25 August 2017 it became apparent, at least to Mr Green, that the $35,000 Mr O’Shannassy lent would not be repaid in the time it was expected it would be repaid. That led Mr Green on 25 August 2017 to send to Mr O’Shannassy and to Mr Sarina an email which included the following:[26]
[26] Exhibit “O”, page 18 (Exhibit “O” being the same as exhibit “JOS-H1” described in J O’Shannassy affidavit 07.04.2020)
As discussed, Clinton is more than comfortable signing the agreement you have drafted regarding the above project. Once again – thanks for your assistance with the ‘short term’ loan.
As originally stated, it is envisaged that the settlement, finance, or on-sale, will now be in a position to proceed . . . .
This being the case, it is envisaged your funds $35,000 (“the Principal”) shall be returned by mid October 2017 (say 15th October), at the latest. If we have them to hand sooner – you will get them sooner.
Clinton is seeking the “interest component” ($15,000 to the end of August, as previously agreed) and any additional interest say at 15% pa be paid to you – as will everyone else’s monies be paid to them, on settlement of the finance, or on-sale. This is envisaged to be within the next few months, as was discussed.
We will know more about the potential and interested suitors next Wednesday (30th August) when we are planning a trip to Qld to sit with everyone.
John, the $35k was very much appreciated at the time. As was agreed previously, you will receive a good return . . . . As you are aware, previously all your money and interest has been paid up in full.
On this occasion, there has been a slight delay due to the above plan being only now released. It is appreciated you need the principal back for tax, etc. As discussed, further monies required to finalise the settlement are being raised now in order to pay out your principal as well as these costs on the project.
Therefore, if you could amend the loan documents to reflect payment of $35,000 by 15 October, 2017, say and then the lump sum interest of $15,000 to say – 15 November, 2017. Any further interest payable for this delay could be assessed at 15% pa of the principal loan and payable on 15 November, as well.
If you could see to these amendments over the weekend and Clinton shall be in a position to execute the documents prior to the trip to Queensland. We will then catch up with you upon our return to update you further, as we did on Wednesday last.
In evidence given under cross-examination, Mr Sarina accepted he received this email. He said, however, that he had not agreed to pay $15,000 as lump sum interest. Mr Sarina said he told Mr Green “that that was never agreed to or heeded to by me, and under those circumstances, that I would [not] be paying $15,000 worth of interest”.[27] Mr Sarina, however, did not send any email to Mr O’Shannassy; and there is no evidence Mr Sarina had any conversation with Mr Green about the email Mr Green had sent, or about the terms on which Mr Green persuaded Mr O’Shannassy to provide the loan.
[27] 25.05.2020 T13.20
On 28 August 2017 Mr O’Shannassy sent an email to Mr Green stating: “this is a unilateral decision. I am too busy to discuss till Wednesday”.[28]
[28] Exhibit A
October – November 2017 – dispute arises about terms on which $35,000 loan was made
According to Mr O’Shannassy he tried to communicate with Mr Sarina to speak about the repayment of the loan, but Mr O’Shannassy could only get hold of Mr Green.[29] On 29 September 2017 Mr O’Shannassy sent an email to Mr Sarina and to Mr Green as follows:[30]
[S]ince we met at the Brookvale Hotel some time ago (over a month) you have failed to contact me. I have sent numerous emails and txt messages to both you and Martin Green but you have not bothered responding.
I have done nothing wrong. I have completed my bargain in the agreement. It is not up to me to chase you. I did you a favour and this is the treatment I get.
Despite my specific conditions of the loan and the basis if [sic] the loan you have not had the decency to pick up the phone or send me a text or even bother for an email.
I told you 1st time we met that I would consider the fact you had breached the agreement. I further gave you a week to respond. You did not respond. I then told you I am not prepared to extend the terms of the agreement and the monies needed to be paid immediately. Again you failed to respond.
Further I have informed you that both you and Martin Green have lost my trust and that you musty [sic] immediately pay the money which was loaned to you as per the agreement. Again you failed to respond.
Your failure to attend meetings as agreed and your failure to communicate with me has left me with no other choice but to put in place institution of proceeding to recover the money borrowed.
You should seek your own legal advice and keep in mind your and Martin Greens [sic] dishonest and unconscionable behaviour. I at one stage considered you friends and colleagues. I now only consider you spivs and con artists.
[29] J O’Shannassy affidavit 07.04.2020, [30]
[30] C L Sarina affidavit 10.03.2020, annexure “B”
Mr Sarina responded with an email he sent to Mr O’Shannassy on 5 October 2017 (copied to Mr Green).[31] Mr Sarina said he took great offence at Mr O’Shannassy referring to him as a “spiv or con artist”; Mr Green had been in constant contact with Mr O’Shannassy; Mr O’Shannassy “organised the above mentioned funds through Martin” without any communication with Mr Sarina at any time before the money was advanced; there has been no breach of agreement because there is no agreement other than “one that turned up for execution after funds were advanced, with no approval from myself at any time beforehand”; and he suggested that Mr O’Shannassy attend a meeting that had been organised “at Brookvale on Monday to resolve this matter as any advancement of funds from you that have been received by myself or any of my companies will be repaid to you this month”.
[31] C L Sarina affidavit 10.03.2020, annexure “B”
Further emails were exchanged, including an email Mr O’Shannassy sent to Mr Sarina on 1 November 2017, which commenced as follows:[32]
s 192E(1)(b) Obtain financial advantage or cause financial advantage by deception Penalty 10 years max
More recent authorities have held that in cases of white-collar crime, the purposes of punishment are best met by way of the imposition of full-time imprisonment rather than an intensive correction order . . .
[32] C L Sarina affidavit 10.03.2020, annexure “B”
Mr O’Shannassy then set out a passage from the judgment of McCallum J in R v Curtis (No 3),[33] and a lengthy passage from a source or sources not identified which set out factors relevant to assessing a sentence for fraud. Mr O’Shannassy concluded his email with the following:
The above look very familiar. Any way I will let the Police deal with this issue. I will pursue all the way to bankruptcy. Thanks for all the paper trail.
[33] R v Curtis (No 3) [2016] NSWSC 866
Mr Sarina responded by email sent on 2 November 2017 in which he stated he took “offence to your threats and false comments”, and stated that “Your Funds advanced to me are in trust with my solicitor” who will be writing to Mr O’Shannassy shortly.[34]
[34] C L Sarina affidavit 10.03.2020, annexure “B”
17 November 2017 – Mr George’s evidence of telephone conversation with Mr O’Shannassy
At 11:48 am on 17 November 2017 Mr O’Shannassy sent to Mr George an email stating he “will be resigning as company secretary”. Mr O’Shannassy also said the “reasons for this you will be interested in knowing. Please ring me to discuss”.[35] According to Mr George,[36] “[o]n receiving this email” he telephoned Mr O’Shannassy and asked what had happened. Mr O’Shannassy said:
You should do your research into Clinton Sarina and Martin Green. Sarina is not someone to be trusted and he deals with underworld figures such as McGurk and is a dangerous individual. He is involved in fraud.
Green is not credible and not of good character, he is also involved in fraud. Green has engaged in criminal activity and has been struck off as a solicitor in New South Wales.
[35] A D J George affidavit 10.03.2020, [8]; annexure “A”
[36] A D J George affidavit 10.03.2020, [9]
Mr George further deposes that, after pressing Mr O’Shannassy to “divulge more”, Mr O’Shannassy said: “You can look them up on Google”.
Mr O’Shannassy does not in his affidavit respond to this part of Mr George’s affidavit; and it was not put to Mr George that a conversation to the effect he deposed did not occur. Under cross-examination, however, it was put to Mr O’Shannassy, and Mr O’Shannassy disagreed, that he had a conversation with Mr George on 17 November 2017; and that he told Mr George that Mr Green and Mr Sarina were of a nefarious nature. Mr O’Shannassy also said he did not in a telephone conversation with Mr George in November 2017 tell Mr George that Mr Green and Mr Sarina were of a nefarious nature; and he did not have a conversation with Mr George before 20 December 2017 about Mr Green or Mr Sarina.[37]
[37] 26.05.2020 T22.45-T23.15
Mr George’s evidence and the evidence Mr O’Shannassy gave under cross-examination is to be assessed by the email Mr George sent to Mr O’Shannassy at 12:38 pm on 17 November 2017, 50 minutes after Mr O’Shannassy sent his email. Mr George’s email was as follows:[38]
[38] Exhibit H
Hi John,
Not a problem.
Please complete the attached and provide us a scanned electronic copy for our records. We will remove you from the company’s registrar [sic] on receipt of this notice.
Perhaps you can send your reasons in writing for our reference.
Mr George does not annex to his affidavit, and otherwise does not refer, to this email in his affidavit. It was tendered into evidence by counsel for Mr Green and Mr Sarina in the course of re-examining Mr George:[39]
[39] 17.04.2020 T108.40
MR RASMUSSEN: Mr George, are you able to tell me why it is that you – or what prompted you – I’m sorry – to send the email dated 17 November 2017 at 12.38 pm to Mr O’Shannassy?‑‑‑It was the email that Mr O’Shannassy had sent, saying, “I will be resigning as company secretary of the company. The reasons for this will be interesting in knowing.”
Right. In other words, exhibit A to your affidavit; is that right?‑‑‑Yes.
Mr George’s having sent the email to Mr O’Shannassy at 12:38 pm on 17 November 2017 is inconsistent with Mr George’s evidence that “[o]n receiving this email” – that is, Mr O’Shannassy’s email sent at 11:48 am on 17 November 2017 annexed to Mr George’s affidavit – Mr George telephoned Mr O’Shannassy and asked what had happened. If that is what had occurred, it is unlikely Mr George would have sent an email 50 minutes later suggesting that Mr O’Shannassy might send his “reasons in writing for our reference”, and without referring to the conversation Mr George says he had with Mr O’Shannassy “on receiving” Mr O’Shannassy’s email.
Mr George’s evidence must also be assessed by reference to the first sentence of the second paragraph of the Email. Mr O’Shannassy there said: “I again warn you of the nefarious nature of Martin Green and Clinton Sarina”. It was put to Mr O’Shannassy in cross-examination that his use of “again” was a reference to Mr O’Shannassy having said to Mr George on 17 November 2017 that Mr Green and Mr Sarina were of a nefarious nature. Mr O’Shannassy denied this.[40]
[40] 26.05.2020 T23.20
Read on its own the sentence “I again warn you of the nefarious nature of Martin Green and Clinton Sarina” does suggest Mr O’Shannassy had previously warned Mr George of the matters stated in the Email. But there are a number of matters to note:
a) The sentence must be read with the sentence that follows it: “I am giving you some information so that you can be fully informed”. That implies Mr O’Shannassy had not previously given any information to Mr George about the nefarious nature of Mr Green or Mr Sarina; and it also implies an assumption that Mr George himself has undertaken no enquiry about Mr Green and Mr Sarina. According to Mr George’s account of the conversation on 17 November 2017, however, Mr O’Shannassy did provide information about Mr Sarina (he dealt with underworld figures such as Mr McGurk, he is a dangerous individual, and he is involved in fraud), and about Mr Green (he has been involved in criminal activity and has been struck off as a solicitor); and Mr O’Shannassy also suggested Mr George “look them up on Google”.
b) Mr O’Shannassy was not asked in cross-examination or in re-examination what he recalls he intended to convey by the word “again” that appears in the sentence.
c) In his email of 21 December 2017 to Mr O’Shannassy, Mr George responded to the Email by stating that “[w]e consider your approach as libel and slander”. Mr George also stated “[w]e have recorded your email and reserve our right to share it with any relevant parties, including those named below”. Mr George, however, does not refer to any conversation he had with Mr O’Shannassy. In particular, Mr George does not refer to the conversation he says he had with Mr O’Shannassy on 17 November 2017. Had such a conversation occurred, it is reasonable to expect that Mr George would have understood the words “again warn” to refer to the conversation he says he had with Mr O’Shannassy on 17 November 2017; and he would have addressed the imputations Mr O’Shannassy made against the characters of Mr Green and Mr Sarina in that telephone conversation, as well as the imputations Mr O’Shannassy conveyed by the Email.
The terms of the emails that were exchanged between Mr O’Shannassy and Mr George on 17 November 2017, and the 50-minute period that separated their exchange, are inconsistent with Mr George having had a conversation with Mr O’Shannassy to the effect deposed to by Mr George. The matters to which I refer in the previous paragraph, particularly Mr George’s not referring to any conversation with Mr O’Shannassy on 17 November 2017, reinforce the inferences that are available to be drawn from the exchange of emails on 17 November 2017.
I therefore do not accept Mr George’s evidence that on 17 November 2017 he had a conversation to the effect of the conversation he says he had with Mr O’Shannassy. My non-acceptance is fortified by the difficulties I identify below with the evidence of Mr George.
Mr George’s asserted reaction to Mr O’Shannassy’s statements made on 17 November 2017
Mr George deposes he recalls being “deeply concerned” by Mr O’Shannassy’s statements “as we had commenced negotiations with the owner of land in Jindabyne for the purposes of securing an interest in water on the property in connection with FDV”; and that Mr Sarina and Mr Green “were integral in all aspects of the FDV business and had been fundamental in achieving these negotiations”. Mr George also deposes he recalls thinking: “who have I got into business with”.[41] Given I have not accepted Mr George had a conversation with Mr O’Shannassy on 17 November 2017 to the effect Mr George says he did, I do not accept this part of his evidence.
[41] A D J George affidavit 10.03.2020, [10]
Quite apart from not accepting Mr George’s evidence about a conversation with Mr O’Shannassy on 17 November 2017, there are a number of observations that may be made about Mr George’s evidence of his reactions to the conversation he says he had with Mr O’Shannassy.
a) Mr George does not identify the negotiations he says had been commenced “in Jindabyne for the purposes of securing an interest in water on the property in connection with FDV”. He does not identify the person or persons on behalf of FDV who was or were undertaking the negotiations, when and how those negotiations were taking place, or the contents of the negotiations.
b) Mr George does not identify the roles and functions Mr Sarina and Mr Green performed on the basis of which Mr George deposed rendered them integral to all aspects of FDV’s business. Although they were shareholders of FDV, neither Mr Green nor Mr Sarina was an employee or officer of FDV.
c) Mr George does not identify the acts Mr Green and Mr Sarina performed which rendered them “fundamental in achieving these negotiations”.
Further, Mr George’s evidence about negotiations “in Jindabyne for the purposes of securing an interest in water on the property in connection with FDV”, and the roles Mr Green and Mr Sarina performed in the business of FDV, is to be assessed against other evidence about these matters:
a) First, there is the evidence Mr Green gave in cross-examination. Mr Green said the proposal to source water from Mr Nastevski was agreed in early 2017, when FDV was incorporated;[42] a terms sheet was entered into with Mr Nastevski who was “purporting to be a party along with the company”;[43] after reaching agreement with Mr Nastevski there was quite a bit of work to do in terms of preparing operational costing and preparing a company budget, and Mr O’Shannassy worked with Mr Green on those matters;[44] as at August 2017 the business was busy and “the company was on track to fulfil its . . . reason for being”, namely the “water source”;[45] Mr Green was working reasonably closely with Mr O’Shannassy, with Mr George and Mr Coleman providing help;[46] fairly late in 2017 Mr George discovered in the course of his due diligence that Mr Nastevski was not the owner of the Jindabyne property or of the water licence;[47] that “caused a major concern” because FDV “had entered into an agreement with [Mr Nastevski] for provision of water supply, and he would appear not to have been able to provide that water supply, and he had been paid $10,000 under the terms of the term sheet”, and this “impacted on the business going forward”;[48] and at the time FDV was wound up, although Mr Green by then “went about looking for alternate water supplies in Wagga and up on the north coast of New South Wales”, and he “did quite a bit of research on [his] own to have a replacement water supply and spoke to a lot of people”, there “weren’t any other serious proposals on the table for an alternative water source”.[49]
b) Second, there is the evidence Mr George gave under cross-examination. Mr George agreed that a question had emerged about whether Mr Nastevski had sufficient title to the Jindabyne property to market the water;[50] Mr George did not “necessarily agree” that this was fatal to any proposal to proceed to extract water from the property, and that is because Mr George understood Mr Nastevski “was in the process of divorce proceedings”, that as “part of the settlement with his former partner . . . he would have some right to the property”, and “that was the basis on which we could potentially continue going forward”, but “there were a lot of moving parts with respect to how we could do that”, and “ultimately, they just weren’t explored”.[51]
c) Third, there is the evidence Mr Sarina gave under cross-examination. Mr Sarina said the purpose of FDV was to sell bottled water;[52] that one of the options was to source water from Mr Nastevski;[53] Mr Nastevski was “alleged to be a landholder”, but after due diligence “his wife was actually the landholder . . . of particular parts of the land”;[54] Mr Sarina’s “involvement in” FDV “was the incorporation of a loan, amongst other things”, that loan being for $10,000;[55] Mr Sarina was “a very integral part of the acquisition of the water source . . . both for Mr Nastevski, and also for other sources throughout Australia, including the Northern Territory”;[56] Mr Sarina’s involvement in the business “was that Mr George and Mr Coleman were clients of [his] that [he] had business dealings with, in other aspects”, and his “role was to match Mr Coleman and Mr George’s experience with a water source that we could acquire, to produce water”.[57]
[42] 16.04.2020 T16.35
[43] 16.04.2020 T16.45
[44] 16.04.2020 T17.5
[45] 16.04.2020 T21.5
[46] 16.04.2020 T21.10
[47] 17.04.2020 T3.45
[48] 17.04.2020 T4.5
[49] 17.04.2020 T4.30
[50] 17.04.2020 T83.5
[51] 17.04.2020 T83.10
[52] 25.05.2020 T5.20
[53] 25.05.2020 T5.25
[54] 25.05.2020 T5.30
[55] 25.05.2020 T7.35
[56] 25.05.2020 T8.10
[57] 25.05.2020 T8.10
Finally, Mr George’s evidence that he recalled thinking to himself “who have I got into business with”[58] is to be assessed in light of evidence that suggests Mr George and Mr Sarina were friends at the time. In his affidavit Mr George deposes that on 25 November 2017 he attended Mr Sarina’s home “for an informal wedding ceremony that was for close friends and colleagues of Mr. Sarina following his formal wedding that had occurred prior to this date”.[59] Under cross-examination, Mr George gave the following evidence:[60]
Yes. But you attended Mr Sarina’s wedding on 25 November, didn’t you?‑‑‑I would have to check the date. I don’t believe ‑ ‑ ‑
It’s at paragraph 19 of your affidavit, Mr George?‑‑‑Sorry. Yes, that – that must be right. I think that – yes. It – it wasn’t his wedding. Sorry. It was – it was an informal ceremony.
I apologise. I’m not aware of the distinction. I assume one of them has a certificate and one doesn’t?‑‑‑Precisely right.
But nonetheless a deeply intimate ceremony in which one would expect that only relatively close friends would be invited. Is that right?‑‑‑No, not quite. There were – there was a lot of people at this ceremony, and Clinton had a number of business associates who were attending the wedding. And the invitation had been extended about a month prior. I had agreed to go. I’m generally a very polite person and I wouldn’t be one to – to turn something like that down unless I had – yes.
You have known Mr Sarina for sometime, haven’t you?‑‑‑I first met Mr Sarina – I think it was towards the end of 2016. Yes.
And you were close enough for him to invite you to this informal wedding ceremony?‑‑‑Well, this wasn’t – it wasn’t actually – his wedding was several weeks before and this was more of a get together where they did a mock ceremony and they had a friend of theirs kind of pretend to be a priest. And it was meant to be a lighthearted Christmas gathering, if anything, celebrating their – their marriage.
I’m sorry, Mr George, by the phrase “informal wedding ceremony” I’m just adopting your words from paragraph 19 of your affidavit?‑‑‑Yes, of course.
So are you still reasonably close to Mr Sarina?‑‑‑Yes. We have – we have interactions, business and friendship-wise, and we have done so ever since.
[58] A D J George affidavit 10.03.2020, [10]
[59] A D J George affidavit 10.03.2020, [19]
[60] 17.04.2020 T99.5-T99.35
If Mr George intended to convey by this evidence that Mr Sarina invited to the “informal wedding” only work colleagues, but not close friends and colleagues, it would not be consistent with what Mr George deposed in his affidavit, namely, that the “informal wedding ceremony . . . was for close friends and colleagues of Mr. Sarina”. Given that the ordinary course of human experience in societies that celebrate marriage is that persons celebrate their wedding with family and close friends, I accept the evidence Mr George gives in his affidavit, namely, that the “informal wedding ceremony” was “for close friends and colleagues of Mr. Sarina”. From this I infer that Mr George was invited to, and Mr George attended, Mr Sarina’s “informal wedding ceremony” because he was a close friend and colleague of Mr Sarina. I do not accept the evidence Mr George gave under cross-examination that he attended Mr Sarina’s “informal wedding ceremony” because he had agreed before his conversation with Mr O’Shannassy on 17 November 2017 to attend the “informal wedding ceremony”, and he was a “polite person” who would not turn down an opportunity to attend a wedding ceremony.
Mr Sarina gave evidence in cross-examination that Mr George was invited to the “informal wedding ceremony” because Mr George was a friend of his wife.[61] It may be accepted that Mr George is a friend of Mr Sarina’s wife. But, given Mr George’s evidence that he had known Mr Sarina since late 2016, I would not accept, if this were the evidence Mr Sarina intended to give, that Mr George was invited to the “informal wedding ceremony” because he was a friend of Mr Sarina’s wife, and not because he was a close friend and colleague of Mr Sarina.
[61] 25.05.2020 T44.40
There is also the evidence I have accepted that in the meeting Mr Green had with Mr O’Shannassy and Mr Versace in late November 2016 Mr Green said that he has a colleague, Mr George, with whom he has had a good business relationship, and who will be able to assist. Mr Green said he would organise a meeting with Mr George.
All of this evidence is a basis for finding, and I do find, that as at November 2017 Mr George was a close friend and colleague of Mr Sarina and a colleague of Mr Green. That finding is supported by what Mr Green said in an email he sent to Mr O’Shannassy on 24 December 2017, after Mr George and Mr Coleman received the Email.[62] Mr George said that “[o]ur confidence in them [that is, in Mr Sarina and Mr Green] and unwavering support of their abilities is founded on the strong relationship we have forged”. Mr George’s having on 24 December 2017 stated he had confidence in Mr Green and Mr Sarina “founded on the strong relationship we have forged” is a basis for inferring, and I would have inferred, that Mr George would have held this belief immediately after his conversation with Mr O’Shannassy on 17 November 2017, had such conversation occurred.
[62] A D J George affidavit 10.03.2020, [25]; annexure “C”.
Given these matters, even if I had accepted Mr George’s evidence that he had a conversation with Mr O’Shannassy on 17 November 2017 to the effect he says he did, I would not have accepted that, as at 17 November 2017, FDV “had commenced negotiations with the owner of land in Jindabyne for the purposes of securing an interest in water on the property in connection with FDV”. The evidence suggests that these negotiations had been completed in early 2017 resulting in an agreement for the provision of water. I also would not have there been satisfied there is any evidence, whether known or unknown to Mr George, that could reasonably support the view that Mr Sarina and Mr Green “were integral in all aspects of the FDV business and had been fundamental in achieving these negotiations”. Further, I would have been, and am satisfied, that as at 17 November 2017 Mr George was a close friend and colleague of Mr Sarina, and he had been a friend since late 2016; and that Mr George had been a colleague of Mr Green with whom he had a good business relationship since at least November 2016. In those circumstances, I would not have accepted that during and after his conversation with Mr O’Shannassy on 17 November 2017 Mr George:
a) believed Mr Sarina and Mr Green or any other person on behalf of FDV had commenced negotiations with the owner of the land in Jindabyne for the purpose of securing an interest in water on the property in connection with FDV;
b) believed that Mr Sarina and Mr Green were integral to all aspects of FDV’s business, or had been fundamental in achieving the negotiations with the owner of the land;
c) was deeply concerned by Mr O’Shannassy’s statements because of the matters referred to in (a) and (b) or because of what Mr George says Mr O’Shannassy said; or
d) asked himself “who have I got into business with”.
Evidence of what Mr George did after conversation with Mr O’Shannassy on 17 November 2017
Mr George deposes that, after his telephone conversation with Mr O’Shannassy, he “decided that [he] would wait for further information from Mr. O’Shannassy to substantiate the claims that he had made, however, no further communication was received.”[63] Mr George subsequently called Mr Coleman, the other director of FDV. Mr George says he informed Mr Coleman of what Mr O’Shannassy had told him, and Mr George explained to Mr Coleman “the risks faced to the business, especially with obtaining finance, if we were going into business with individuals who were as described by Mr. O’Shannassy”.[64] Mr George also says that at the time of his call with Mr Coleman, he and Mr Coleman “conferenced called Mr. Green”, and a conversation to the following effect occurred:[65]
[63] A D J George affidavit 10.03.2020, [12]
[64] A D J George affidavit 10.03.2020, [11]
[65] A D J George affidavit 10.03.2020, [13]
George:Mr. O’Shannassy has made some serious allegations against you and Sarina that would need an explanation.
O’Shannassy said that I should do my research into him [sic] and Clinton Sarina. He told me that Sarina is not someone to be trusted and that he deals with underworld figures and is a dangerous individual.
[H]e also told me that you are not credible and are not of good character, that you have engaged in criminal activity and have been struck off as a solicitor in New South Wales.
Green:We are having difficulties with Mr. O’Shannassy at the moment and that his call was likely borne out of those difficulties.
George:I need to meet with you and Mr. Sarina to discuss this with both of you in detail. Shall I call Mr. Sarina?
Green:I will inform Mr. Sarina and make sure we are both available to meet and discuss your concerns.
Given I have found I am not satisfied Mr George had the conversation with Mr O’Shannassy on 17 November 2017 which Mr George says he did, I do not accept this evidence. There are in any event a number of difficulties with Mr George’s evidence, even if I had accepted Mr George’s evidence that he had the conversation he says he did on 17 November 2017 with Mr O’Shannassy.
a) It is implausible Mr George had the conversations with Mr Coleman and Mr Green he says he had in circumstances where Mr George says he expected Mr O’Shannassy to provide further information to substantiate the statements Mr O’Shannassy made. That suggests Mr George considered the claims required substantiation. If Mr George held this belief it is improbable he would have sought an explanation from Mr Sarina and Mr Green without first obtaining such substantiation from Mr O’Shannassy.
b) It is implausible Mr George would have had a conversation with Mr Coleman in which Mr George referred to Mr Green and Mr Sarina as “individuals who were as described by Mr. O’Shannassy”. That implies Mr George had no knowledge or belief about the background of Mr Green or Mr Sarina or of their characters, and that he believed Mr Coleman had no such knowledge or belief. As I have already noted, Mr George had attended an “informal wedding ceremony that was for close friends and colleagues of Mr. Sarina”; and Mr George has deposed that Mr Coleman, too, had attended that ceremony. [66] That implies both Mr George and Mr Coleman were close friends and colleagues of Mr Sarina. Further, Mr George’s reference in his email of 24 December 2017 to Mr O’Shannassy to “the strong relationship we have forged” implies a relationship that had been forged before 17 November 2017 with Mr Sarina and Mr Green, and in late November 2016 Mr Green described to Mr O’Shannassy Mr George as a colleague with whom he had a good business relationship.
c) It is implausible Mr George would have said words to the effect of “if we were going into business with individuals who were as described by Mr. O’Shannassy”. Mr George and Mr Coleman were the directors of FDV. That company was registered on 9 January 2017; Mr George and Mr Coleman were appointed directors on that day; they each held 24 shares; and Mr Green held 12 shares.[67] Mr Sarina gave evidence that he, too, was a shareholder.[68] Thus, Mr George and Mr Coleman were not in November 2017 considering going into business with Mr Green and Mr Sarina; they were already in business with them, and had been in business with them since at least January 2017.
d) It is implausible Mr George would have explained to Mr Coleman “the risks faced to the business, especially with obtaining finance”. As at 17 November 2017 the only person the evidence reveals had provided finance to FDV was Mr Sarina; and there is no evidence FDV was then seeking finance from any other source or that it was in a position to do so. Further, by around that time it became apparent the water supply from the Jindabyne property might not be available. That renders it unlikely that FDV would have been seeking finance at that time.
e) Mr George did not undertake any search on the internet before he spoke to Mr Coleman or to Mr Green about the matters Mr O’Shannassy stated. It is true Mr George deposes that he searched the internet. But Mr George says he did this late in the afternoon of 17 November 2017; and he does not identify the results of his search. This renders implausible Mr George’s evidence of his telephone conversation with Mr Green. If, as Mr George deposes, he was “deeply concerned” by what Mr O’Shannassy said it is reasonable to expect he would have undertaken the searches before he contacted Mr Green, and that he would have discussed with him any results he may have found.
f) The conversation Mr George says he had with Mr Green is implausible. Mr George said Mr Green said Mr O’Shannassy’s statements were “likely borne out of . . . difficulties”, “[w]e are having . . . with Mr. O’Shannassy at the moment”. On his account of this conversation, however, Mr George did not ask Mr Green to inform him what those difficulties were. If, as Mr George deposes, he was “deeply concerned” about what Mr O’Shannassy said to him on 17 November 2017, and that he wanted an explanation from Mr Sarina and Mr Green, it is reasonable to expect Mr George would have asked Mr Green to explain what these difficulties were.
g) On his account of his conversation with Mr Green, Mr George asked Mr Green whether Mr George should call Mr Sarina. That is not consistent with my finding that Mr George was a close friend and colleague of Mr Sarina; nor is it consistent with Mr George’s reference in his email of 24 December 2017 to Mr O’Shannassy of the “strong relationship” with Mr Sarina and Mr Green. Had Mr George been “deeply concerned” he would have contacted Mr Sarina about those concerns himself.
[66] A D J George affidavit 10.03.2020, [19]
[67] J O’Shannassy affidavit 19.05.2020, annexure “A”
[68] 25.05.202 T7.45
These difficulties, by themselves, would have led me not to accept Mr George’s evidence of what he did after the conversation he says he had with Mr O’Shannassy on 17 November 2017.
Mr Green’s evidence of conversation with Mr George on 17 November 2017
Mr Green deposes he had a conversation with Mr George on 17 November 2017:[69]
[69] M Green affidavit 10.03.2020, [6]
On the [sic] 17 November 2017 I received a conference call request from Andrew George and Bryan Coleman. When I became part of the conference call Andrew George said to me words to the following effect
“Mr. O’Shannassy has made some serious allegations against you and Sarina that would need an explanation. O’Shannassy said that I should do my research into you and Clinton Sarina. He told me that Sarina is not someone to be trusted and that he deals with underworld figures and is a dangerous individual.”
I recall being really shocked about this. I said:
“We are having difficulties with O’Shannassy at the moment and that his call was likely because of that.”
Andrew said
“We will need to meet with you and Mr. Sarina to discuss this with both of you in detail.”
I recall saying words to the effect of:
“Okay, I will call Clinton and see when we can meet to discuss your concerns.”
Given I am not satisfied Mr George had a conversation with Mr O’Shannassy on 17 November 2017, and I do not accept Mr George’s evidence that he had a conversation with Mr Green, I do not accept Mr Green’s evidence. There are in any event difficulties with Mr Green’s evidence.
a) On Mr Green’s account, Mr George said Mr O’Shannassy “has made some serious allegations against you and Sarina”. Mr Green, however, does not say he asked Mr George to identify the “serious allegations” Mr O’Shannassy made about Mr Green. That is implausible. The natural reaction of a person who is confronted with a statement that serious allegations have been made about him or her is to ask what those allegations are so that he or she may respond to them or put himself or herself in a position to respond to them.
b) On Mr Green’s account Mr George said it is likely Mr O’Shannassy made the allegations against him because “[w]e are having difficulties with O’Shannassy at the moment”; yet Mr George did not ask Mr Green what those difficulties were. That is implausible if, as Mr George deposes, his telephone call to Mr Green was prompted because he was “deeply concerned” by Mr O’Shannassy’s statements.
c) On Mr Green’s account, he said he would call Mr Sarina to arrange a meeting. That is not consistent with my finding that Mr George was a close friend and colleague of Mr Sarina. Had Mr George in truth desired to obtain an explanation from Mr Sarina he would have contacted Mr Sarina, just as Mr Green says Mr George contacted him.
These difficulties, by themselves, would have led me not to accept Mr Green’s evidence even if I had accepted Mr George’s evidence that he had a conversation with Mr O’Shannassy on 17 November 2017 to the effect Mr George says he did.
Mr Green has given the following evidence of his reaction to the telephone conversation he says he had with Mr George:[70]
When I got off the telephone, I was very worried because I thought that all the hard work I had put into this company could end badly. I was very concerned that Andrew George and Bryan Coleman would pull out as they were the major shareholders and investors in FDV. We had also entered into negotiations with the owner of the water source in Jindabyne and I thought we might be very close to a deal which would be in jeopardy if Andrew and Bryan pulled out.
[70] M Green affidavit 10.03.2020, [6]
In light of the findings I have already made I do not accept this evidence. There are in any event difficulties with Mr Green’s evidence which, when considered alone, would have led me not to accept his evidence:
a) There is no evidence Mr George and Mr Coleman were the major shareholders and investors in FDV.[71] The “ASIC Current & Historical Organisation Extract” that is in evidence shows FDV had a paid up capital of $100 with each of Mr George and Mr Coleman holding 24 shares.[72] Mr Green holds 12 shares, and another person holds 24 shares, although it is not apparent from the copy of the extract that is in evidence who that person is. Further, the only person the evidence reveals provided substantial funds to FDV is Mr Sarina, who said he lent $10,000 to FDV.
b) Mr Green’s evidence that he thought “we might be very close to a deal” with the owner of the water source in Jindabyne is not consistent with the evidence Mr Green gave under cross examination which I have set out above. The effect of that evidence is that in early 2017 FDV had entered into an agreement with the person it was believed was the owner of the Jindabyne property, and that by late 2017 Mr George had discovered that the person with whom the agreement was made was not the owner of the land.
[71] The evidence is to the contrary. Mr George was asked whether he had invested any money in FDV. Mr George said: “A couple of hundred dollars. Sorry. I couldn’t tell you an exact figure” – 17.04.2017 T91.30
[72] J O’Shannassy affidavit 19.05.2020, annexure “A”
Mr George’s evidence of being “very suspicious”
Mr George says that the statements Mr O’Shannassy made on 17 November 2017 made him “very suspicious”. Mr George started to believe Mr Sarina and Mr Green were not of good character. He “devised an exit strategy”, a “contingency plan to sever all ties” with Mr Sarina and Mr Green “on the basis that they were not fit and proper people to be engaged in business with, in particular with my legal career to consider”.[73] Mr George also deposed as follows:[74]
I considered that Mr. O’Shannassy had a long-standing relationship with Mr. Sarina and Mr. Green and for him to make those statements to me, I considered he wanted me to take them seriously. I was also aware that Mr. O’Shannassy was a practicing [sic] solicitor and because of this gave significant weight to his statements. I also considered that his resigning his position as company secretary with FDV, was strong indicia that the statements he made were intended to be taken seriously and were of such concern that I should consider doing the same.
[73] A D J George affidavit 10.03.2020, [14]
[74] A D J George affidavit 10.03.2020, [15]
Given I am not satisfied Mr George had a conversation with Mr O’Shannassy on 17 November 2017, I do not accept Mr George’s evidence. There are in any event difficulties with Mr George’s evidence that would have led me not to accept this evidence, even if I had found he had a conversation to the effect Mr George says he had with Mr O’Shannassy on 17 November 2017.
a) Mr George does not identify the “exit strategy” or “contingency plan” he says he devised. Under cross-examination Mr George said the exit strategy “was more something that I internalised when I first read the emails from Mr O’Shannassy”.[75] Mr George was not asked in re-examination whether he could recall the strategy he devised.
b) Mr George says he devised the “exit strategy” or “contingency plan” before he met with Mr Green and Mr Sarina to obtain their responses to the statements Mr O’Shannassy made on 17 November 2017. There is no evidence, however, Mr George implemented any exit strategy or contingency plan he devised because of any suspicion he held of Mr Sarina or Mr Green.
c) In his email of 24 December 2017 to Mr O’Shannassy Mr George said that, after consulting with Mr Sarina and Mr Green “we are satisfied on all matters that may or may not subsist”, and that “[o]ur confidence in them and unwavering support of their abilities is founded on the strong relationship we have forged”. As will appear later in these reasons, on Mr George’s evidence, apart from his evidence that late in the afternoon on 17 November 2017 he searched the internet, the results of which Mr George has not set out in his affidavit, the only enquiries Mr George says he made about Mr O’Shannassy’s allegations were questions he asked of Mr Green and Mr Sarina. That suggests that, even on his own evidence, Mr George was not concerned about the allegations Mr O’Shannassy made about the characters of Mr Sarina or Mr Green. Had he been concerned, Mr George would have made additional enquiries.
d) Mr George’s evidence that he relied on what he believed was a long standing relationship between Mr Sarina and Mr Green, on the one hand, and Mr O’Shannassy, on the other, is implausible. There is nothing in the evidence that could have provided any ground for Mr George to believe there was any such relationship, or what the nature of that relationship was. More significantly, however, this part of Mr George’s evidence implies he knew very little of Mr Sarina and Mr Green, and that he did not have access to his own experiences with Mr Sarina and Mr Green on the basis of which he could assess the statements Mr O’Shannassy made. That is inconsistent with my finding that Mr George was a close friend and colleague of Mr Sarina; with Mr George’s reference in his email of 24 December 2017 to Mr O’Shannassy to the “strong relationship we have forged” with Mr Sarina and Mr Green; and with my accepting Mr O’Shannassy’s evidence that in late November 2016 Mr Green told Mr O’Shannassy he has a colleague, Mr George, with whom he has had a good business relationship, and who will be able to assist.[76]
[75] 17.4.2020 T91.40
[76] J O’Shannassy affidavit 07.04.2020, [7]
Mr George’s evidence of internet search
Mr George says that late in the afternoon on 17 November 2017 he “looked up “Clinton Sarina” and “Martin Green” and the word “fraud” on the internet”.[77] Mr George does not say what, if anything, he found when he looked up these words on the internet. Mr George does not say that in later discussions with Mr Sarina or Mr Green that he had searched the internet. I therefore do not accept Mr George’s evidence that he searched the internet as he says he did.
[77] A D J George affidavit 10.03.2020, [16]
About one week after 17 November 2017 - the asserted Langham Sydney meeting
According to Mr Sarina, on or about 17 or 18 November 2017 Mr Green asked him to meet with Mr George and Mr Coleman at “The Langham Sydney” in Kent Street. Mr Sarina says Mr Green was very worried, and said words to the effect: “This is very important Clinton. It is about O’Shannassy. We need to meet.”[78] This evidence is implausible; had Mr Green telephoned Mr Sarina about a matter that was so serious as to merit a meeting, it is reasonable to expect Mr Sarina would have asked questions about why a meeting was required. On Mr Sarina’s evidence, however, it appears he was not told about the statements Mr O’Shannassy made to Mr George on 17 November 2017 until about one week later. In any event, given I am not satisfied Mr George had the conversation he says he had with Mr O’Shannassy on 17 November 2017 I do not accept Mr Sarina’s evidence.
[78] C L Sarina affidavit 10.03.2020, [5]
Each of Mr George, Mr Green, and Mr Sarina has given evidence they met at “The Langham Sydney” in Kent Street (the asserted Langham Sydney meeting). Mr Green and Mr George say they met about one week after their conversation of 17 November 2017. Mr George deposes “we spoke about the allegations”. Mr Sarina said: “Those allegations are false, I had proceedings against Fairfax [M]edia about those articles and I won”. Mr Green said: “I stopped practicing [sic] as a solicitor voluntarily and that there was no action taken against me that resulted in me being struck off the roll of solicitors”. Mr George also said: “Mr. Sarina and Mr. Green both gave explanations but I was still left in a suspicious state of mind”.[79]
[79] A D J George affidavit 10.03.2020, [17], [18]
Mr George does not identify “the allegations” about which he says the participants spoke; and he does not identify the “allegations” Mr Sarina said were false. Mr George deposes that Mr Sarina referred to proceedings he had taken against Fairfax Media “about those articles”, but Mr George does not refer to any conversation in which the articles are identified. On Mr George’s account of his conversation with Mr O’Shannassy on 17 November 2017, which I have not accepted, Mr O’Shannassy does not refer to any articles; and Mr George does not say he came across any articles because of the search he says he made on the internet late in the afternoon on 17 November 2017. On the evidence before me, the first time Mr George became aware of newspaper articles relating to Mr Sarina is on 20 December 2017 when he received the Email. Finally, although Mr George says he “was still left in a suspicious state of mind”, there is no evidence he did anything to investigate the allegations Mr O’Shannassy made in relation to Mr Sarina and Mr Green before he received the Email. But Mr George responded to the Email by email sent at 4:06 pm on 21 December 2017 – some 19 hours later - in which he requested that Mr O’Shannassy “cease and desist all contact with us and any and all related entities and persons”, and that “[w]e consider your approach as libel and slander”. Even if, therefore, Mr George did have a conversation to the effect of the conversation he said he had with Mr O’Shannassy on 17 November 2017 I would not have accepted Mr George’s evidence of the asserted Langham Sydney meeting.
According to Mr Green and Mr Sarina, the following occurred at the meeting:[80]
a) Mr George said that Mr O’Shannassy “says that the two of you have been involved in fraud, that Clinton has been involved with McGurk and that Martin has been struck off as a solicitor”.
b) Mr Sarina said: “Those allegations about me are false, I have taken action against Fairfax media about those articles and I won”. Neither Mr Sarina nor Mr Green deposes to any conversation in which the articles are identified.
c) Mr Green said “[t]hose accusations are false”; he was not involved “in criminal activity”; he was not stuck off; he stopped practising as a solicitor in 2014, and he did not reapply for his practising certificate; and no action was taken against him.
[80] M Green affidavit 10.03.2020, [7]; C L Sarina affidavit 10.03.2020, [6], [7]
Mr Sarina also deposed that on hearing Mr George state what Mr O’Shannassy had told Mr George on 17 November 2017 Mr Sarina “couldn’t believe what I was hearing”.[81] This implies that Mr Sarina was not made aware of what Mr O’Shannassy said to Mr George on 17 November 2017 until the asserted Langham Sydney meeting, which, on the evidence of Mr George and Mr Green, occurred about one week after Mr George’s conversation with Mr O’Shannassy.
[81] C L Sarina affidavit 10.03.2020, [7]
Given I am not satisfied Mr George had a conversation with Mr O’Shannassy on 17 November 2017, and the other findings I have made, I do not accept Mr George, Mr Green, and Mr Sarina met at “The Langham Sydney” in Kent Street and had conversations to the effect of what they depose they did. But even apart from those findings, I would not have accepted their evidence. It is implausible Mr Green would have set up a meeting with Mr Sarina without telling him the purpose of the meeting; there is an absence of any detail of the “allegations” that were said to have been discussed; Mr Sarina referred to articles when there is no suggestion Mr O’Shannassy had referred to those articles in his conversation with Mr George on 17 November 2017; and it is implausible Mr Sarina would have been first informed of the statements Mr O’Shannassy made to Mr George on 17 November 2017 at a meeting that occurred about one week later.
Mr Sarina’s evidence of his state of mind at and after the asserted Langham Sydney meeting
Mr Sarina has given the following evidence of his reaction to what he says Mr George said to him at the asserted Langham Sydney meeting:[82]
I remember being very shocked. I thought that my proceedings against Fairfax and [sic] put such false accusations to be [sic] bed. I was very upset about what Andrew told me. I had wondered why Andrew seemed to be very wary of me when we met at the hotel. I began to wonder if this would damage the project as negotiations with the land owner were underway. Andrew and Bryan were also significant shareholders and investors in the project. If they pulled out, I would lose my investment in the project. I became very worried. I was also embarrassed.
[82] C L Sarina affidavit 10.03.2020, [8]
Given the findings I have already made I do not accept this evidence. In any event, I would not have accepted Mr Sarina’s evidence for the following reasons:
a) Mr Sarina refers to “proceedings against Fairfax”, and that those proceedings had put “such false allegations to . . . bed”. Mr Sarina does not identify the proceedings to which he refers. There is in evidence, however, a statement of claim Mr Sarina filed in the Federal Court of Australia on 16 August 2017 in which he claimed Fairfax Media Publications Pty Ltd had defamed him by publishing articles on 14 September 2009 and 16 October 2010 imputing Mr Sarina arranged a fraudulent loan and that he was a former employee of Mr McGurk.[83] That proceeding was not settled until about early 2020, [84] which means it was on foot at the time of the asserted Langham Sydney meeting. It is therefore unlikely Mr Sarina could have believed at that time that the false allegations had been put to bed.
b) Mr Sarina’s evidence that “negotiations with the land owner were underway” is not consistent with the evidence I have already set out about FDV’s arrangements with the purported owner of the Jindabyne property. That evidence shows that in early 2017 FDV signed a terms sheet with the purported owner but later in 2017 Mr George discovered the purported owner was not the true owner of the Jindabyne property. Thus, it is not likely that Mr Sarina would have believed that “negotiations with the land owner were underway”.
c) As I have noted, although each of Mr George and Mr Coleman held 24 shares in FDV, the company had paid up capital of $100. There is no evidence Mr George or Mr Coleman invested anything other than the nominal value of the 24 shares they each held; and Mr Sarina gave evidence under cross-examination that “I was the investor that kept us viable. . . . If it was shut down, it would have been shut down because of the lack of investment by myself”,[85] thus suggesting Mr Sarina was the only person with a substantial financial stake in FDV.
[83] Exhibit K
[84] 25.05.2020 T38
[85] 25.05.2020 T8.45-T9.5
Mr Green’s evidence of his state of mind at and after the asserted Langham Sydney meeting
Mr Green deposes that at or after the asserted Langham Sydney meeting he “became very worried about what would happen to the project”; he began to feel sick, anxious, and depressed; he thought there was nothing he could do to make Mr George and Mr Coleman feel satisfied he is a person of good character; and Mr Sarina seemed worried to Mr Green as well. Mr George’s attitude to Mr Green “seemed to be unusual”; and Mr Green “felt as if he was treating” Mr Green very suspiciously and very cautiously. Given the findings I have already made, I do not accept this evidence. Quite apart from those findings, however, I would not have accepted this evidence. There is no evidence Mr Green sought medical assistance; and the evidence does not identify any conversation or action or omission by Mr George or Mr Coleman on the basis on which an assessment could be made that Mr George or Mr Coleman acted suspiciously and very cautiously. Further, Mr Green’s evidence of Mr George’s attitude to Mr Green is inconsistent with the attitude Mr George displayed in the emails he sent on 21 and 24 December 2017 to Mr O’Shannassy to which I refer later.
Evidence of conversation at “informal wedding ceremony”
Mr George says that on 25 November 2017 he attended Mr Sarina’s home for “an informal wedding ceremony that was for close friends and colleagues of Mr. Sarina following his formal wedding that had occurred prior to this date”. Mr George deposes the following occurred:[86]
In the evening, Mr. Green, Mr. Sarina, Mr. Coleman and I were having a drink together and Mr. Coleman asked about Mr. O’Shannassy’s email. I recall at the time I was embarrassed that this had been raised at such an important event for Mr. Sarina, and he and Mr Green were embarrassed. I said “we can discuss this at a later date” and ended the conversation.
[86] A D J George affidavit 10.03.2020, [19]
There are a number of difficulties with this evidence:
a) Mr George does not identify Mr O’Shannassy’s email about which Mr Coleman asked. Mr George annexes emails to his affidavit, but the only email that had been sent by Mr O’Shannassy before 25 November 2017 is the email he sent to Mr George on 17 November 2017 in which Mr O’Shannassy said no more than that he will be resigning as company secretary of FDV, and that “[t]he reasons for this you will be interested in knowing. Please ring me to discuss”. It is inherently unlikely that there would be any discussion on a social occasion such as the celebration of a marriage of the contents of an email that contained information of the sort contained in Mr O’Shannassy’s email of 17 November 2017, or that the contents of such email could cause any embarrassment.
b) There is no evidence Mr O’Shannassy sent the email of 17 November 2017 to Mr Coleman, or that Mr George forwarded the email to Mr Coleman.
c) Mr George does not say what Mr Coleman asked about “the email” to which Mr George refers.
d) Although on his account Mr George responded to Mr Coleman’s question by stating that “we can discuss this at a later date”, Mr George does not give any evidence of his having later discussed with Mr Coleman any email Mr O’Shannassy had sent before 25 November 2017. As I set out below, Mr George does give evidence of discussing with Mr Coleman an email Mr O’Shannassy had sent, but that is the Email, which was sent on 20 December 2017.
e) Neither Mr Green nor Mr Sarina refers in their affidavit to the “informal wedding ceremony” on 25 November 2017.
Given these difficulties, although I accept that Mr George, Mr Green, and Mr Coleman attended the informal wedding ceremony on 25 November 2017, I do not accept Mr George’s evidence about the conversation of any email.
Second half of December 2017 – Mr O’Shannassy undertakes “research” on Mr Green and Mr Sarina
According to Mr O’Shannassy, in the second half of December 2017 he “decided to do some research”. Mr O’Shannassy says he decided to do so because he was receiving “scant information and few updates” about the progress of the water project, and he had “became suspicious of Mr Green and Mr Sarina after the problems [he] had encountered with them failing to honour their obligations to repay the loans”.[87] Mr O’Shannassy deposed as follows:[88]
I discovered that Mr Green had given evidence before the NSW Police Integrity Commission about his association with corrupt Police and that he was associated with a convicted person, Mr Fischetti. My searches showed that Mr Green was mentioned adversely in the reported decision of R v Fischetti [No5] [2016] ACTSC 213. Pages 021 - 033 are copies of pages v, vi and 40 - 49 of the report to the NSW Parliament known as “Operation Florida”.
My research also uncovered findings by the Administrative Decisions Tribunal of NSW in 2008 and 2009 concerning Mr Green in the following Administrative Decisions Tribunal of NSW matters: Law Society of NSW v Green [2008] NSWADT 149 (22 May 2008) and The Council of the Law Society of New South Wales v Green (No 2) [2009] NSWADT 297 (30 November 2009).
[87] J O’Shannassy affidavit 07.04.2020, [35]
[88] J O’Shannassy affidavit 07.04.2020, [36], [37]
Mr O’Shannassy further deposed that these matters concerned him greatly. He says:[89]
My responsibilities as Company secretary encompassed the role of acting as board advisor. As such I was responsible for the organisation’s corporate governance. I had statutory and common law duties to the Company. I took these duties seriously as I was (and remain) a fellow of the Governance Institute of Australia. I was so concerned I felt compelled to bring the information I had discovered to the attention of the other shareholders and directors. I decided I needed to warn the two directors of the Company, Mr George and Mr Coleman of my findings.
[89] J O’Shannassy affidavit 07.04.2020, [38], [39]
I accept Mr O’Shannassy undertook the “research” he says he undertook. I do not accept, however, Mr O’Shannassy’s evidence about why he decided to undertake such research. As I have already noted, on 17 November 2017 Mr O’Shannassy sent an email to Mr George in which he said that he “will be resigning as company secretary”,[90] and that, 50 minutes later, Mr George responded with an email stating that that was not a problem and requesting that Mr O’Shannassy “complete the attached and provide us a scanned electronic copy for our records”, after which “[w]e will remove you from the company’s registrar [sic] on receipt of this notice”.[91] This suggests, and I find, that by 17 November 2017 Mr O’Shannassy had resolved to resign and intended to give effect to that resignation. That is inconsistent with Mr O’Shannassy’s believing after he sent the Email that he was responsible for FDV’s corporate governance, and that he owed statutory and common law duties to FDV.
[90] A D J George affidavit 10.03.2020, [8]; annexure “A”
[91] Exhibit H
20 December 2017 – Mr O’Shannassy sends Email
At 9:22 pm on 20 December 2017 Mr O’Shannassy sent the Email to the email addresses of Mr George and to Mr Coleman. The Email was as follows:[92]
[92] A D J George affidavit 10.03.2020, [2]; annexure “B”
Dear Gentlemen,
I must apologise. I discovered that I had not completed the notification of my resignation as company secretary. I will do that over the next few days.
I again warn you of the nefarious nature of Martin Green and Clinton Sarina. I am giving you some information so that you can be fully informed.
I hear from a colleague Gary Stewart Martin Green is under investigation by the Legal Services Commissioners yet again. The issues [sic] is fraud. They are both in serious trouble so I would be very careful in any dealings with these rogues.
Clinton has court proceeding [sic] against him in the Supreme Court for what I am told fraud again. You need to make up your own minds on how you deal with Martin Green and Clinton Sarina. But I would google them booth [sic]. They have both been involved in a fraud matter in which one party went to gaol for 6 years and in which the judge said that id [sic] Martin Green gave evidence he would have gone to gaol as well.
I suggest you read the court judgment.
See links
See links
[Photograph]
McGurk duo linked to $150m loan fraud – SMH.com.au
THE murdered standover man Michael McGurk’s two closest confidants have been named as part of a massive investigation into an alleged $150 million mortgage fraud.
align="left"> align="left"> align="left">The above comments are post the court case
It will be necessary to describe the documents to which the hyperlinks resolved (linked documents) because there is a dispute about whether the defamatory matter includes not only the text of the Email but also the matter contained in the linked documents.
a) The first linked document is an article published by the Sydney Morning Herald on 16 October 2010 (First Article).[93] The heading of that article is contained in the text of the Email. The article contains a number of statements and makes a number of assertions based on what the article says is a “claim … made in a NSW police fact sheet tendered in Waverley Local Court”.
b) The second linked document is an article published by the Daily Telegraph on 16 October 2010 (Second Article).[94] Like the First Article, the Second Article makes a number of statements which purport to be based on “a police statement that was tendered during a bail application . . . in Waverley Local Court yesterday”.
c) The third linked document is the judgment of Robinson AJ in R v Fischetti (No 5) [2016] ACTSC 213.[95] The judgment concerns the sentencing of Mr Fischetti following his conviction on a number of dishonesty charges.
d) The fourth linked document is an article published by the Sydney Morning Herald on 6 September 2009 (Third Article).[96] The article is headed “McGurk tape handed to police”.
[93] Part of Exhibit R
[94] Exhibit “O”, page 109 (Exhibit “O” being the same as exhibit “JOS-H1” described in J O’Shannassy affidavit 07.04.2020)
[95] Part of Exhibit R
[96] Exhibit “O”, page 112 (Exhibit “O” being the same as exhibit “JOS-H1” described in J O’Shannassy affidavit 07.04.2020)
20-21 December 2017 – Mr George’s reaction to the Email
In his affidavit Mr George says he received and read the Email. Mr George says:
a) The Email was a “repetition of the statements made by Mr. O’Shannassy to me on 17 November 2017”; when he read the Email it caused him “further concern”; Mr George “became very worried about our business arrangement”, and that was because “we had not had a discussion in detail with Mr. Sarina and Mr. Green on these issues in detail”.[97]
[97] A D J George affidavit 10.03.2020, [20], [21]
b) Mr George telephoned Mr Coleman and, after Mr Coleman said he had read the Email, Mr George asked him what he thought about it. The conversation continued as follows: [98]
[98] A D J George affidavit 10.03.2020, [22]
Mr Coleman: I am worried about the email and doing business with these guys.
Mr George: They seem to have a tarnished reputation so we will probably have to be the face of the business.
Mr Coleman: [Mr Coleman agreed] We had better have a detailed meeting with Clint and Martin about this email and the allegations that O’Shannassy is making about them.
c) Mr George then spoke to Mr Green by telephone on 21 December 2017.[99] He and Mr Green “spoke for a long time on the telephone”; Mr George “asked him about the allegations that O’Shannassy had made in the email”; Mr George recalls “asking when we could meet with him and Sarina about the email”; and “Mr. Green sounded very upset on the telephone”.
d) Mr George decided to do “some further checking on Mr. Sarina and Mr. Green”.[100]
At that time, I was reluctant to continue business with Mr. Sarina and Mr. Green, but due to the considerable efforts and work put into the projects, I decided that we could proceed at risk and put measures in place, for instance, stronger contracts with warranty provisions, to safeguard our interests.
[99] A D J George affidavit 10.03.2020, [23]
[100] A D J George affidavit 10.03.2020, [24]
There are three particular matters to note. The first is that s.33 of the Defamation Act is not concerned with whether the person who has been defamed has in fact suffered any harm. The enquiry is whether, because of the circumstances in which the defamatory matter was published, the person defamed was unlikely to sustain harm. That does not necessarily mean, however, that evidence of beliefs, and actions consistent with those beliefs, that manifested themselves or occurred after the publication of the defamatory matter is not available to prove that particular beliefs existed at the time the defamatory matter was published. That such evidence may be admissible was recognised by the New South Wales Court of Appeal in Morosi v Mirror Newspapers Ltd.[182] One ground of appeal was that the trial judge had misdirected the jury about the application of the predecessor of s.33 of the Defamation Act. That ground was rejected for the following reasons:[183]
The subsequent acts or statements of persons from which it appears, or may be inferred, that the person defamed was or was not upset by the defamatory publication can have only a limited bearing on whether that person’s reputation was likely to be damaged or his feelings were likely to be hurt. In a trial as complex as the present one, it would not be appropriate to spend a large amount of time on such a peripheral matter. The direction complained of may have been too limited, but the possible prejudice to the appellant – and it may be that the respondent had equal cause to complain – is too slight to warrant interference.
[182] Morosi v Mirror Newspapers Ltd [1977] 2 NSWLR 749
[183] Morosi v Mirror Newspapers Ltd [1977] 2 NSWLR 749, at page 799
The second particular matter to note is the meaning of “harm” in s.33 of the Defamation Act. In Smith v Lucht McMurdo P considered the meaning of that word:[184]
The term “harm” is not defined in the Act. Compensable harm for defamation includes not only reparation for harm done to the plaintiff’s personal and business reputation, but also harm for personal distress and hurt caused to the plaintiff by the publication, and to vindicate the plaintiff’s reputation. In the absence of a clear statement to that effect, it seems unlikely the legislature in enacting s 33 intended to deprive those who had proved they were defamed from obtaining damages for any compensable harm arising from the defamation. That construction is supported by the use of the phrase in s 33 of “any harm” (my emphasis). I am presently unpersuaded that “harm” in s 33 should be construed as limited to reputational harm.
[184] Smith v Lucht [2016] QCA 267, at [11] (footnote omitted).
In Barrow v Bolt Kaye JA reviewed the relevant authorities; and although his Honour concluded that it “is now an entrenched part of defamation law that the harm, for which damages are awarded, include hurt and distress suffered by a plaintiff arising from the publication of the defamatory matter about him or her”, his Honour decided not to express a final view about whether “harm” as it appears in s.33 of the Defamation Act means the harm for which damages may be awarded.[185] In these reasons, however, I will assume that “harm” in s.33 of the Defamation Act means the harm for which a plaintiff may be awarded damages, which would include hurt feelings and distress occasioned by the publication of the defamatory matter.
[185] Barrow v Bolt [2015] VSCA 107, at [43]-[57]
The third particular matter to note relates to the range of imputations to which s.33 of the Defamation Act applies. It is not restricted to imputations that are “trivial”; s.33 of the Defamation Act is capable of applying to serious defamatory imputations. That point was made by Badgery-Parker J in Perkins v New South Wales Aboriginal Land Council:[186]
The question to which s13 [of the 1974 Act] directs attention is whether the circumstances of the publication were such that the plaintiff was unlikely to suffer harm. It appears to me, with respect, that the characterisation of the defamation as trivial involves circularity of reasoning: a defamation, no matter what the substance of the imputation, will be trivial only if the circumstances of its publication were such that the plaintiff was unlikely to suffer harm. Obviously, since the circumstances include, as the court said in Morosi, the nature of what was published, the defence is less likely to be made out where the content of the imputation is serious than when the content of the imputation is trivial, but it is misleading, in my view, to embark upon a consideration of s13 from the stand point that its application is only in respect of trivial defamations. The question whether a defamation is trivial can only be answered after, not before, the circumstances of the publication have been evaluated in terms of s13.
The major circumstances of a publication (apart from its content) which are likely to be such as to render it unlikely that the plaintiff would suffer harm are the extent of -the publication of the defamatory material, the nature of the recipients, and the relationship, if any, between the recipients and the plaintiff. It would be relatively easy to make out the defence in circumstances where the publication was to a small number of persons well acquainted with the plaintiff and able themselves to make a judgment of their own knowledge as to the likelihood that there was any substance in the imputation conveyed.[186] Perkins v New South Wales Aboriginal Land Council (unreported, NSWSC, 15 August 1997), BC9708048, at page 27. The New South Wales Court of Appeal referred to this part of Perkins with apparent approval in Jones v Sutton [2004] NSWCA 439, at [14], [15]
Application
I turn, then, to the circumstances of the publication of the Email. Those circumstances are to be assessed by reference to the findings I have made, which includes my not having accepted most of the evidence of Mr George, Mr Sarina, and Mr Green.
First, there are the contents of the Email. There is no question the Imputations I have found the Email conveyed are serious. Second, there is the extent of the publication: the Email was sent to, and only to, Mr George and Mr Coleman; and the Email also came into the hands of Mr Sarina and Mr Green. Third, there is the evidence that is relevant to assessing the reactions of Mr George, Mr Coleman, Mr Sarina, and Mr Green, to the publications of the Email.
As for Mr George, I have not accepted his evidence about his reaction to reading the Email, or his evidence about what he did after he received the Email. There is, however, evidence from which Mr George’s reaction to reading the Email may reasonably be inferred, and that is the email he sent to Mr O’Shannassy at 4:06 pm on 21 December 2017, the email he sent to Mr O’Shannassy at 8:46 am on 24 December 2017 (copied to the email addresses of Mr Green, Mr Sarina, and Mr Coleman), and the email Mr George sent at 10:54 am on 24 December 2017 to the email addresses of Mr O’Shannassy and Mr Coleman, but addressed to Mr Sarina.
a)In the email sent at 4:06 pm on 21 December 2017 Mr George said “[w]e consider your approach as libel and slander”. I have already found that those words indicate that at the time he sent the email Mr George did not have a concern that the matters stated in the Email were or might be true. I have also found that Mr George had no such concern at the time he read the Email.
b)In the email sent at 8:46 am on 24 December 2017 Mr George said “[w]e have consulted” with Mr Sarina and Mr Green. Mr George does not identify in his email the nature of the consultations; and there is no evidence I have accepted that reveals the nature of the consultation that was undertaken. Given the findings to which I have referred in (a), I find that any consultation Mr George may have had with Mr Sarina or Mr Green would not have involved Mr George raising questions with either Mr Sarina or Mr Green about whether any of the matters stated in the Email were or might be true. This finding is supported by the absence of evidence that I have accepted that Mr George or Mr Coleman made any enquiries of Mr Sarina or Mr Green about the matters alleged in the Email. It is also supported by the statement Mr George made in the email that “we are satisfied on all matters that may or may not subsist”. That such unqualified statement of satisfaction was made in the absence of evidence of any enquiries about the matters asserted in the Email indicates Mr George was not concerned, and had never been concerned, that the matters stated in the Email were or might be true.
c)In the email sent at 10:54 am on 24 December 2017 to the email addresses of Mr O’Shannassy and Mr Coleman, but addressed to Mr Sarina, Mr George said that “[a]s mentioned you have our full support”. As with the expression of support Mr George conveyed in the email he sent at 8:46 am on 24 December 2017, that Mr George would convey “our full support” to Mr Sarina in the absence of evidence of enquiries about the matters asserted in the Email indicates Mr George was not concerned, and had never been concerned, that the matters stated in the Email were or might be true.
Next, there is Mr Coleman. He has not given evidence. Mr O’Shannassy submits I should draw inferences based on Jones v Dunkel.[187] The conditions for drawing such inferences are not satisfied. There is, however, evidence relevant to assessing Mr Coleman’s reactions to the Email. First, there is the email Mr Coleman sent to Mr Green at 11:04 am on 21 December 2017 by which Mr Coleman forwarded the Email to Mr Green. Mr Coleman said nothing in that email about the Email. That is a basis for inferring that Mr Coleman said nothing about the Email because he did not have any concerns that the matters stated in the Email were or might be true. If he had any concerns it is reasonable to expect Mr Coleman would at the very least have requested a response from Mr Green about the matters asserted in the Email.
[187] Jones v Dunkel (1959) 101 CLR 298
Second, there are the emails Mr George sent to Mr O’Shannassy at 4:06 pm on 21 December 2017, the email he sent to Mr O’Shannassy at 8:46 am on 24 December 2017 (copied to the email addresses of Mr Green, Mr Sarina, and Mr Coleman), and the email Mr George sent at 10:54 am on 24 December 2017 to the email addresses of Mr O’Shannassy and Mr Coleman, but addressed to Mr Sarina. Mr George says “we” or “our” rather than “I”. Mr George was cross-examined about his use of “we” in the email he sent to Mr O’Shannassy at 8:46 am on 24 December 2017. It will be necessary to set out his evidence.[188]
[188] 17.04.2020 T88.20-T90.5
So am I – sorry. So if I can just bring you back to annexure C to your affidavit ‑ ‑ ‑?‑‑‑Of course.
where you say – where you wrote that:
We have faith.
If that doesn’t refer to you and Mr Coleman, who does it refer to?‑‑‑Sorry:
We have faith.
Is this in the first email or the second?
Sorry. Bear with me for a moment while I find the right one. If you turn to annexure C – sorry. I withdraw that. “faith” is the wrong word. It’s “confidence”. You see where it says:
Our confidence in them is –
‑ ‑ ‑?‑‑‑Yes.
If not you and Mr Coleman, who is the “our”?‑‑‑Sorry. This is a – a habit. And this – this is probably a – an industry fault. When I say “we”, I’m obviously talking about the company and “our”, the company and – and myself.
So you were speaking for both directors?‑‑‑No. I was speaking for myself and, at the time – yes. I – I generally try to avoid using the word “I” unless it – it relates to a specific matter. It’s just a force of habit. So in this instance, I would have been referring more to the company.
So you were referring to yourself in the plural?‑‑‑In a way, but more as the company and a director of the company.
But you notice that, throughout that paragraph, you use the plural. You also say:
We have consulted –
?‑‑‑Yes.
And:
The strong relationship we have forged.
?‑‑‑Yes.
And in the immediately preceding paragraph:
I am fully aware –
?‑‑‑Yes. That’s right.
And:
..... I have used.
?‑‑‑Yes. That’s right. And that relates to the previous correspondence because Mr O’Shannassy was essentially addressing that point to me personally relating to slander and liable [sic] and point out defamation law. And so I felt that was something I needed to address personally. And the rest was subsequently including the company as a disposition.
All right. And you felt that you could express those views on behalf of the company unilaterally. Is that right?‑‑‑I believed I could exercise my discretion in this instance given the fact that I had consulted with Mr Coleman about the risks. And we determined appropriate mitigations at the time. And so, therefore, I was confident and capable and had capacity to represent the company’s interests at that time.
Sorry, Mr George. . . . . But you just said then that you had some conversations with Mr Coleman about this. And earlier, you said that you hadn’t at that stage. When you sent this email, was this a view that you had discussed with Mr Coleman?‑‑‑Sorry. Just going back, and just to correct you, I did mention to you before that I had had conversations with Mr Coleman. I believe that’s – that’s well stated throughout my affidavit. So we had had conversations. It was more me telling him what had happened and telling him what my belief was in terms of risks and what I thought was the best decision for the company at the time. And Mr Coleman, at the time, listened and had concerns of his own, I would imagine. And we addressed – well, I addressed this directly with Mr O’Shannassy, being the addressee, for Mr O’Shannassy’s emails. . . .
I do not accept this evidence. Although I find it is likely Mr George had a conversation or conversations with Mr Coleman about the Email, I do not accept he had a conversation to the effect of which Mr George has given evidence. I do not accept Mr George used the word “we” to refer only to himself, or only to himself and “the company”, by which I infer Mr George intended to refer to FDV. Mr George does not state in any of his emails that he sent the emails on behalf of FDV or as a director of FDV. In the emails he sent to Mr O’Shannassy on 21 and 24 December 2017 Mr George ends with the words “Kind regards ANDREW GEORGE”, and Mr George ends his email sent at 10:54 am on 24 December 2017 to the email addresses of Mr O’Shannassy and Mr Coleman, but addressed to Mr Sarina, with the words “Kind regards ANDREW GEORGE | Lawyer”. Further, in the email sent at 8:46 am on 24 December 2017 Mr George differentiated between the use of “I”, “our”, and “we”. That is also apparent in the email Mr George sent at 10:54 am on 24 December 2017 to the email addresses of Mr O’Shannassy and Mr Coleman, but addressed to Mr Sarina where, immediately after stating “you have our full support”, Mr George says “I look forward to hearing of your win against Fairfax”.
I find, therefore, that Mr George used the words “we” and “our” to refer to the recipients of the Email, namely, Mr George and Mr Coleman; and that he did so after he had a conversation or conversations with Mr Coleman about the Email, although not a conversation to the effect Mr George says he had with Mr Coleman. On the basis of those findings, I also find that the matters stated in the emails Mr George sent on 21 and 24 December 2017 reflected both Mr George’s and Mr Coleman’s beliefs about the matters asserted in the Email and about the characters of Mr Sarina and Mr Green. This finding is supported by Mr George having included Mr Coleman as a recipient in the emails Mr George sent on 24 December 2017. On the basis of these findings, I further find that, at the time he read the Email, Mr Coleman, like Mr George, did not acquire any concern that the matters stated in the Email were or might be true, and he did not acquire any such concern after he read the Email.
Finally, I must consider Mr Sarina and Mr Green. Neither Mr Sarina nor Mr Green says he believed in or wondered about the truth of the assertions contained in the Email to the extent they applied to the other. I find that Mr Sarina did not believe the assertions the Email made about Mr Green, and Mr Green did not believe the assertions the Email made about Mr Sarina.
A fourth matter relevant to the circumstances of the publication of the Email is the relationship between the recipients of the Email, Mr George and Mr Coleman, and those who had been defamed, Mr Sarina and Mr Green. The matters that are relevant to identifying the nature of the relationship are as follows:
a)Mr Green introduced Mr George and Mr Sarina to Mr O’Shannassy. I have accepted Mr O’Shannassy’s evidence that in late November 2016 Mr Green referred to Mr George as a colleague with whom he had a good business relationship.
b)On 25 November 2017 each of Mr George, Mr Green, and Mr Coleman attended Mr Sarina’s home “for an informal wedding ceremony that was for close friends and colleagues of Mr. Sarina following his formal wedding that had occurred prior to this date”.[189]
c)In the email Mr George sent to Mr O’Shannassy at 8:46 am on 24 December 2017 Mr George said: “Our confidence in them and unwavering support of their abilities is founded on the strong relationship we have forged”. This statement conveys two messages. One is that “we” – Mr George and Mr Coleman – have confidence in, and unwaveringly support, Mr Sarina and Mr Green. The second message is that such confidence and support was based on “the strong relationship we have forged”. That is a statement on the basis of which it is reasonable to find, and I do find, that at the time Mr George sent the email there had subsisted a strong relationship between Mr Coleman and Mr George, on the one hand, and each of Mr Sarina and Mr Green, on the other. I further find that in large part it is this strong relationship that explains the findings I have made that Mr George and Mr Coleman never became concerned that the matters stated in the Email were or might be true.
[189] A D J George affidavit 10.03.2020, [19]
In light of these findings I am satisfied that the circumstances in which the Email was published were such that both Mr Sarina and Mr Green were unlikely to sustain any harm. The Email was published only to Mr George and Mr Coleman; at the time of publication each of Mr George and Mr Coleman had forged a strong relationship with each of Mr Sarina and Mr Green; at the time each of Mr George and Mr Coleman read the Email they did not become concerned that the matters stated in the Email were or might be true; and there is no evidence I have accepted to indicate that either Mr George or Mr Coleman made any enquiries of Mr Sarina or Mr Green, at the time they were made aware of the Email, about whether any of the matters alleged in the Email were or might be true, which is a basis for finding, and I do find, that neither Mr George nor Mr Coleman made any enquiry of Mr Sarina or Mr Green about whether any of the matters asserted in the Email were or might be true. On these findings, it is unlikely that Mr George’s and Mr Coleman’s regard for Mr Sarina and Mr Green would have been diminished by their reading the Email; and it is unlikely that Mr Sarina and Mr Green would have believed or suspected that Mr George’s or Mr Coleman’s regard for them would have been diminished because Mr George or Mr Coleman read the contents of the Email.
Further, having also found that neither Mr Sarina nor Mr Green believed in the truth of any of the matters alleged in the Email as they related to the other, it is unlikely that Mr Sarina’s and Mr Green’s regard for each other would have been diminished because they read the Email; and it is unlikely that either Mr Sarina or Mr Green would have believed or suspected that the regard in which they were held by the other would have diminished because they read the Email.
Conclusion
For these reasons, Mr O’Shannassy succeeds in his defence based on s.33 of the Defamation Act.
Damages
Although I have concluded Mr O’Shannassy succeeds on his defence based on s.33 of the Defamation Act, it would be convenient if I deal with the question of damages on the assumption I am incorrect in so concluding.
Counsel for Mr Sarina and Mr Green referred me to the general principles concerning damages for defamation as summarised by White J in Hockey v Fairfax Media Publications Pty Limited.[190] Counsel also referred me to the following passage from the judgment of Wigney J in Chau v Fairfax Media Publications Pty Ltd [2019]:[191]
Section 34 of the Defamation Act provides that “[i]n determining the amount of damages to be awarded in any defamation proceedings, the court is to ensure that there is an appropriate and rational relationship between the harm sustained by the plaintiff and the amount of damages awarded”.
Past authorities shed some light on what might be considered to be the “appropriate and rational relationship” for the purposes of s 34.
In Carson v John Fairfax & Sons Ltd (1993) 178 CLR 44 at 60, a majority of the High Court noted that there are three purposes to be served by damages awarded for defamation: 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. The first two purposes are frequently considered together, whereas “[v]indication looks to the attitude of others to the [plaintiff]: the sum awarded must be at least the minimum necessary to signal to the public the vindication of the [plaintiff’s] reputation”: Carson at 61.
The level of damages should reflect the fact that the law “should place a high value upon the reputation and in particular upon the reputation of those whose work and life depend upon their honesty, integrity and judgment”: Crampton v Nugawela (1996) 41 NSWLR 176 at 195; referred to with approval in John Fairfax Publications Pty Ltd v O’Shane (No 2) [2005] NSWCA 291 at [3].
[190] Hockey v Fairfax Media Publications Pty Limited [2015] FCA 652, at [446]
[191] Chau v Fairfax Media Publications Pty Ltd [2019] FCA 185, at [337]-[340]
In assessing damages, the following matters are relevant:
a)I have not accepted the evidence Mr Sarina, Mr Green, and Mr George have given about their reactions to reading the Email and what they say they did in response to reading it.
b)I have found the Email was published only to Mr George and to Mr Coleman, and the Email was provided to Mr Sarina and Mr George.
c)I have found that when Mr George and Mr Coleman each read the Email they did not become concerned that the matters stated in the Email were or might be true.
d)I have found that neither Mr George nor Mr Coleman made any enquiries of Mr Sarina or Mr Green about the truth or otherwise of the assertions contained in the Email.
e)In his email sent at 4:06 pm on 21 December 2017, less than 24 hours after Mr O’Shannassy had sent the Email, Mr George sent an email to Mr O’Shannassy requesting Mr O’Shannassy cease all contact, and stating that “[w]e consider your approach as libel and slander”.
f)In his email sent at 8:46 am on 24 December 2017 to Mr O’Shannassy, Mr George said “we are satisfied on all matters that may or may not subsist”, and that “[o]ur confidence in them and unwavering support of their abilities is founded on the strong relationship we have forged”.
g)In his email sent at 10:54 am on 24 December 2017 to the email addresses of Mr O’Shannassy and Mr Coleman, but addressed to Mr Sarina, Mr George said: “As mentioned you have our full support”.
On these findings, I find that Mr Sarina’s or Mr Green’s reputations were not in any way harmed by the publication of the Email; they did not experience any hurt or distress such as to warrant damages for consolation; and their reputations would not have required vindication by anything more than the award for nominal damages. Further, given these findings, Mr O’Shannassy’s not having provided an apology at the time one was demanded would have had no bearing in assessing the harm Mr Sarina and Mr George suffered because of the publication of the Email.
My conclusion is a consequence of my not having accepted the evidence of Mr Sarina, Mr Green, and Mr George on which Mr Sarina and Mr Green rely for establishing loss of reputation and other harm because of the publication of the Email. That I have not accepted their evidence would not by itself have been fatal to awarding damages; and that is because damage “to reputation need not be proved as it is presumed”.[192] But that presumption must give way to evidence that shows there has been no harm to reputation. And that is what I have found in relation to Mr Sarina’s and Mr Green’s reputations based on the evidence I have accepted.
[192] Hockey v Fairfax Media Publications Pty Limited [2015] FCA 652, at [446]
Had I not concluded that Mr O’Shannassy succeeds in his defence based on s.33 of the Defamation Act, therefore, I would have awarded no more than nominal damages.[193]
[193] Given my conclusion on damages, it is unnecessary to consider Mr O’Shannassy’s application for leave to file an amended defence in the form of the draft annexed to the affidavit of Mr See made on 24 June 2020.
Conclusion
I propose to order that judgment be entered in favour of Mr O’Shannassy. I will also direct that within 14 days the parties file and serve written submissions (including evidence, if any) on what order for costs I should make. I will also direct that within seven days after filing their written submissions on costs, the parties notify my associate whether they require a hearing on the question for costs, or whether they would agree to my determining the question of costs on the papers.
I certify that the preceding two hundred and twenty (220) paragraphs are a true copy of the reasons for judgment of Judge Manousaridis
Associate:
Date: 30 October 2020
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