SCALA & SCALA
[2019] FCCA 3456
•10 December 2019
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SCALA & SCALA | [2019] FCCA 3456 |
| Catchwords: FAMILY LAW – Property – Applicant’s primary claim being an action for breach of confidence – whether actions for breach of confidence sound in damages – applicant suffering diagnosed ill-health as a result of breach of confidence – award of $70,000 for breach of confidence – division of the remainder of the non-superannuation property pool 60/40 in favour of the wife – agreed equalisation of superannuation. |
| Legislation: Family Law Act 1975 (Cth) |
| Cases cited: Commonwealth & John Fairfax & Sons Limited (1980) 147 CLR 39 Giller & Procopets [2008] VSCA 238 Grey & Motor Accident Commission (1990) 196 CLR 1 Kennon & Kennon [1997] FamCA 27 Lamb & Cotongo (1987) 164 CLR 1 |
| Applicant: | MS SCALA |
| Respondent: | MR SCALA |
| File Number: | DGC 1434 of 2018 |
| Judgment of: | Judge Burchardt |
| Hearing dates: | 17 & 18 October 2019 |
| Date of Last Submission: | 18 October 2019 |
| Delivered at: | Dandenong |
| Delivered on: | 10 December 2019 |
REPRESENTATION
| Counsel for the Applicant: | Mr McInnis |
| Solicitors for the Applicant: | Waters Lawyers |
| Counsel for the Respondent: | Mr Korke |
| Solicitors for the Respondent: | James McConvill & Associates |
IT IS NOTED that publication of this judgment under the pseudonym Scala & Scala is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT DANENONG |
DGC 1434 of 2018
| MS SCALA |
Applicant
And
| MR SCALA |
Respondent
REASONS FOR JUDGMENT
Introduction
This is a property case in two parts. The first part, which is in many ways straightforward and relatively uncontroversial, is the simple property adjustment application made by the parties. The second part, which received almost all the emphasis during the running of the case, is the applicant wife’s claim for damages for breach of the equitable duty of confidence.
For the reasons that follow, I am going to order that the wife receive the total of $70,000 as damages for the husband’s breach of the equitable duty of confidence, but that otherwise the property pool be divided equally between them.
Agreed or uncontroversial relevant matters
The applicant wife was born on … 1967, and the husband was born on … 1967 (the parties are divorced, but it is convenient to use this nomenclature). The wife is employed as a public servant at the Employer A, and the husband is employed as a customer service officer by a small company (not itself identified).
The parties married on … 1991 and have had four children, Ms W, born … 1991, Mr X, born … 1995, Mr Y, born … 1997, and Ms Z, born … 2000.
On 1 August 2017, the applicant was made aware by Ms Z that the respondent had posted a number of photographs of her on the internet. These were photographs of the applicant either naked or partially undressed, and I will return to the nature of these photographs and what arose in more detail when I deal with the evidence of Dr B. Ms Z was deeply upset at the time, and the applicant was utterly horrified by the photographs. The respondent was arrested on 1 August 2017, and an Intervention Order followed on 3 January 2018. The husband was jailed for nine months. Some of the chronology as to his imprisonment is a little hard to follow as a result of typographical errors in the wife’s trial material.
The husband initially appealed his sentence from the Magistrates’ Court to the County Court, but abandoned the appeal.
The parties agree that they had little in the way of assets at the commencement of the relationship. At the time of the respondent’s arrest, they owned no fewer than four properties. Three of those properties have since been sold. The property in Suburb K was sold and a cash amount of $330,973 remains in the parties’ self-managed superannuation fund.
The wife has applied monies from the sale of properties in Suburb L and Suburb C, together with her former shareholding in the M Shares, worth $32,000, and a redraw on the matrimonial home mortgage so that she owns a property at Suburb F solely and unencumbered.
All four children remain wholly sundered from their father, with whom they do not at present wish to have any relationship whatsoever. The respondent continues to live with his parents and appears to intend to continue to do so.
The parties’ affidavits
I do not propose to traverse or paraphrase the parties’ trial affidavit material. It is largely encapsulated in the material above. I note that the wife has deposed to an earlier heads of agreement, which fell through because of a valuation difficulty. The wife has deposed in her trial affidavit that she did consent to some photographs some 10 years ago, but did not at any time consent to their wider dissemination, quite the contrary.
The husband has deposed to being employed as a customer service officer at a salary of $49,000. He said that he had not, as the applicant asserts, disseminated thousands of pictures on the internet, and said that there were only some 10 to 12 pornographic videos. I notice at paragraph 75 of his trial affidavit, he deposed that no material was still on the internet.
The report of Dr B
Dr B’s report is appended to his affidavit sworn 18 September 2019. Dr B recorded the background details of the relationship, and then took a history from the applicant as to her upbringing and married life. I note that the applicant described herself as a Catholic, and that no sex occurred before marriage. She described the husband as essentially controlling during the relationship and gave supporting details. I note that at page 8 of 14 of his affidavit, the applicant described her work at Employer A, where she has been employed since 2011 on a full-time basis, and described herself “as committed and passionate in regard to her work. I love it.” She is well respected. In 2018, she worked as a public servant. I note that at page 10 of 14, Dr B recorded:
According to the Police, there are 33 (sites) involving three videos of printed images of Ms Scala with penises of unknown males visible masturbating and ejaculating on pictures of her, as well as footage noting her:
- Exiting a shower and drying herself completely naked;
- In the bath completely naked;
- Lying on a bed with Mr Scala, both completely naked;
- Touching Mr Scala’s penis and he was touching her vagina;
- Changing clothes in her room.
The report continues on the same page:
His mobile phone was seized, and on 7th August, a Google search of the username ‘…’ was undertaken, revealing a large number pornographic websites associated with that user name. A search revealed 33 websites containing images of Ms Scala’s naked breasts, genital and/or anal regions.
The report goes on to note that:
further analysis of his iPad revealed numerous images throughout 2016 and 2017, and analysis of his phone revealed a video of Ms Scala asleep with her breasts revealed. Yahoo emails purporting to be from Ms Scala were noted, including ‘I like when guys send me videos of them coming on me, it gets me real horny to do more, would you like to do some for me’.
I note that page 11 of 14, the applicant denied any previous or family history of psychiatric illness. I note she had previously been a regular churchgoer, but had not been to mass for some time. “She does not feel worthy any more.”
At page 12 of 14, Dr B recorded the applicant’s description of her circumstances. These included a deterioration of her emotional state, constant rumination, albeit with no active suicidal symptoms, and anxiety as the respondent’s jail term was coming to an end, together with feeling unsafe and panic attacks and ruminations. Dr B described her affect as:
Her mood was anxious and depressed. Her affect was preoccupied and tense. She was largely tearful throughout the interview. Rapport and eye contact were a little distant at first but increased as she settled into the interview.
Under the heading Talk, the report noted:
Ms Scala was a detailed and cogent historian. Her speech was interrupted by her emotional state at times, but was generally normal in flow, rate, and prosody. Thought form and procession were normal. Thought content related to longstanding marital unhappiness, bullying, coercion and control. Following discovery of the websites, her mood deteriorated, considers the marriage to be over, and remains afraid of Mr Scala. There are no unusual notions or ideas, evidence of thought disorder or delusional beliefs. There were depressed and anxious themes and features of traumatisation.
Under the heading Diagnosis on page 13 of 14, Dr B opined:
Ms Scala has a chronic adjustment disorder with depressed and anxious mood and features of traumatisation.
I take account of all of the matters under the heading Opinion, noting that in paragraph 1, Dr B opined:
Despite the unhappiness she experienced, because of her upbringing and childhood, Ms Scala never thought of leaving the marriage but now considers it to be over as a result of the shock of discovering the websites which she knew nothing about, and given her catholic upbringing and somewhat prudish nature, is horrified.
In paragraph 2 and 3, Dr B relevantly noted:
At interview, Ms Scala was distressed and anxious, and was tearful throughout most of her account. Despite all that has occurred, nonetheless she continues to be dedicated to her children, and is working full time. Despite her vulnerability, she impressed as a person of some determination. I consider that overall, given her love of the children, support for others, there is a reasonable prognosis over time.
As noted, her account was compelling, detailed and believable, and if anything, I consider she was likely to be under-reporting aspects of the husband’s actions on her. I judge Ms Scala to be a reliable witness in regard to the account she has provided to me.
The evidence given and submissions made at Court
What follows is taken from my notes.
The opening and evidence of the applicant
Counsel indicated that the claim based on defamation was abandoned. There are two properties: the matrimonial home at Suburb D valued at $600,000 and the property at Suburb E at $300,000. There was an agreement that superannuation should be equalised.
The applicant was called and adopted her trial affidavit as true and correct. She sought treatment in November last year. She had made an attempt at suicide. She saw her general practitioner and a registered psychologist. She is taking antidepressants and sleeping tablets as required. She has been on antidepressants for some time and carries drugs with her at all times. She takes diazepam for stress.
The applicant said she started to study to become a public servant in 2008. She had worked additionally and had paid all her fees. She graduated in 2012, and has since then been employed as a public servant. She is still a public servant. She is not a senior public servant. She did apply for such a position, but her manager was not prepared to appoint her because of the difficulties she was facing. I should observe that the witness became extremely labile during this passage of her evidence, which was clearly distressing to her. Her income is $88,000 per annum, and she lives in the former matrimonial home. She still possesses the former household chattels.
The applicant said she married in 1990. It was not a happy marriage. The husband was the primary breadwinner, but she worked all the time. The applicant said that the respondent did little gardening or other household tasks. Indeed, it was plain from what she said and how she said it that she is bitterly resentful at the husband for his conduct and for the unhappy marriage generally. She conceded that she has written a book, which is in the process of being published. When taxed with exhibit R1, being an internet advertisement for the book, she had never seen it. The publisher told her it would not be in the stores until just before Christmas. The book is called …: … and is about 80 pages in length.
She discovered the internet material in 2017. The husband was charged with offences and pleaded guilty to stalking and spent nine months in prison. The applicant said that the judge in the County Court had tried to give the respondent a longer amount of time when he appealed, but I should say that from the description of what took place, it seems likely that he abandoned his appeal on an indication that his sentence might be increased.
Counsel put it to the applicant that there were a total of 10 to 12 videos uploaded onto 33 websites over a 10-year period. The applicant did not agree.
The applicant said she had to sell the properties in Suburb K and Suburb L because they could not keep up repayments. Land was bought at Suburb F. She completed the purchase while the husband was in prison.
It was put to her that the husband was not dismissed but resigned from his position with the Employer M. The applicant said that she thought it was a forced resignation. She has had no contact with the husband since this blew up. She said it was hard enough to be in the same room (something entirely consistent with her demeanour, which was facing as far away from the respondent as she could in the witness box).
The applicant conceded the respondent paid the mortgage until he lost his job. She said that the children had told her about the pornography which they had found while looking at his iPad. The husband was buying a lot of collectibles which cost a lot of money. He had promised he would stop. She had thought that the credit card was for solar panels and thought it was destroyed when the solar panels were paid out.
Police had brought the husband back to collect his belongings. The collectibles were already with his parents. They were taken there in preparation for selling the house. There are some collectibles in the matrimonial home. Some are quite valuable. She had seen Dr B. She loves her job. She is well-respected in it, but she was only a public servant in 2018 for a couple of months.
She did not recall the interview with Dr B well as it was a very emotional day. It cost her a lot of money to go to Dr B and it was a difficult experience. She had not intended to write a book. It was just therapy for her at the start. The respondent was controlling during the relationship, and she was only allowed to watch one television program, …. He would not eat his dinner if it was not on time. She did not know about all the collectibles the husband bought. He knew that they did not have money to spend.
In re-examination, the applicant confirmed that she had not seen the Amazon document (exhibit R1) until the day of trial. She had not been paid any money for her proposed book. It covered the period mainly from September 2017 to February 2018, and it was about the children. She had just paid her HECS debt off last year. She also tended a report from her treating psychologist without objection as exhibit A1.
Counsel formally read the affidavit of Ms Z, which gives details of the discovery of the pornographic material.
The evidence of the respondent
Counsel called the respondent, who adopted his affidavits and Financial Statement as true and correct. He confirmed, however, that he has had to cash his previously owned shares. This was before he went to prison, to pay bills.
Under cross-examination, it was put to the respondent that his conduct had lasted from 2007 to 2017. The respondent said there were numerous charges and he had pleaded guilty to one. The evidence that it was from 2007 to 2017 was incorrect. A video he had taken had a date stamp in Chinese which was incorrect. He was not offending for 10 years. He was not proud of what he did, and was ashamed of what he did. The offending was from 2013 to 2017. He was ashamed of what he had done. The relationship deteriorated towards the end of the marriage. He went too far. They were not as intimate as before and he missed that. He had been suicidal.
The wife had thrown out his pen camera and also his watch camera. He used his phone in 2017. The wife was getting dressed and he took photographs. These got onto his iPad. He had photographed the wife in the shower, and this got onto the internet. He appealed his sentence, but he could not recall the details by which it was abandoned. He knew he had been selfish in the past. He agreed that his material was accessed to seven sites, probably from 2013. When it was put to him that there were 560 images on his iPad, he said that he refuted that. What was on his iPad was what was on his iPhone. There were 20 images at the most. He conceded that there was no control once they were on the web.
He said the applicant was seeing a psychologist before all this, although she never told him why. His no comment interview with the police was done on advice. He knew the children were upset, and that this would upset his wife. The videos of the wife were made with his devices, the pen and watch. The pen was in the bathroom and she threw it out. Then he bought a watch. He did not know the wife had a psychological condition at that time. The pen and watch were before she saw a psychologist. He loaded videos to his computer. Originally, there were consensual photographs on camera. Those images were on his computer. He said, and I regard this as telling, “I got carried away with the feedback.” He agreed it was foreseeable that the wife would be upset. He said everyone reacts differently. He referred in passing to a prison officer who had responded with words to the effect that she might have been flattered by her images being on the Net.
The respondent confirmed he is in full-time employment, earning about $49,000. He lives with his parents and he pays $100 per week. He started employment in … 2019, and he is going okay. His income will not increase. It is a small private business. He also pays statutory superannuation. He works in Suburb N.
When cross-examined about collectibles, it became apparent that what he was referring to was 17 tubs of small matchbox car type toys.
The husband said that he collected only his clothes and his car, and that this was all he possessed. I should say that this evidence was given with conviction, and I accept it. He had collected his collectibles over a long time.
The evidence of Detective Senior Constable G
Senior Constable G had interviewed both the parties. The husband said he had no comment, but then made admissions. He was aware of the appeal. He was not there when the respondent was sentenced. Only charge 1, stalking, proceeded. Images are still online. The husband said he would remove images, but some have been and some not.
Under cross-examination by counsel for the respondent, Senior Constable G confirmed that he had checked the websites this morning, but not made a list. He had checked four of the eight sites and two had been deleted.
The evidence of Dr B
Dr B was called and adopted his affidavit as true and correct. It was put to him that Mr X is no longer at home and the position of public servant referred to in his report was only temporary. He was not aware of an alleged suicide attempt when he saw the wife on 14 August.
Counsel put it to Dr B that there had been one attempt at suicide to drown in the bath. The applicant says it was in November 2018. The psychologist (exhibit A1) says May 2019. Dr B confirmed that this did not change his overall assessment.
Under cross-examination by counsel for the respondent, Dr B confirmed that he had conducted a clinical examination and assessment but no tests. His conclusions depended upon the truthfulness of the client. He would normally have included suicidal ideation were it reported. He normally asks this as a routine question. He must have asked the question. There was no current suicidal ideation when he saw the applicant. The applicant had had to sell two investment properties. He was aware that she was going through a marriage breakdown and was involved in criminal proceedings.
Adjustment disorder comes from a stressor of some kind. The sale of properties and the criminal proceedings would add to the adjustment disorder.
When asked about the adjustment disorder, Dr B said that he sees people who become chronic and who do not resolve. They may go on and on and on. It sometimes morphs into major depressive disorder. When asked what the applicant’s prognosis was, Dr B said over time, once this proceeding is over, things will lessen and her condition will resolve. Dr B said adjustment disorder is vastly over-diagnosed, but the applicant is suffering from it.
When asked how long it might take for the applicant to recover, Dr B said she was distressed when he saw her, but it was not a severe or moderately severe condition. The applicant has all her children and friends around her and is in stable employment. She is well on the way to recovery. He saw her in August and thought she would resolve in some three months.
When asked further questions by counsel for the applicant by leave, Dr B said that acute relates to the brevity of time. Chronic means the condition grumbles on. It can continue for some time and can morph into major depression. However, this was not the case here. This is characterised by an inability to work and conduct daily life, which is not how the applicant is.
Final submissions by counsel for the applicant
Counsel submitted that this was a unique case. He submitted that breach of confidence is an equitable doctrine. He said he would address the issue of damages first. He emphasised that costs would follow the event in relation to this aspect of the claim, and referred to the celebrated case of Kennon & Kennon [1997] FamCA 27. In that case, the Full Court assessed damages first. He was not pursuing any damages for defamation. Counsel submitted the Court should consider the gravity and nature of the case. It was a 27-year marriage with four children which ended solely because of the conduct of the husband. The assessment of damages was a matter for the court. The wife seeks $250,000 and the husband said $50,000. This was an intentional infliction of damage. Intention can be imputed to the respondent, and this was relevant to the damages.
Counsel referred to exhibit A1, the evidence of the applicant and Dr B. The applicant acts in the interests of her children, but her resilience should not diminish her damages. The respondent’s conduct was outrageous, and the wife’s demeanour while giving evidence was telling. She is still being treated for anxiety. She is keen to move from the former family home.
Counsel sought aggravated and exemplary damages and referred to Lamb & Cotongo (1987) 164 CLR 1 in this regard. Aggravated damages are, of course, compensatory in nature.
In respect of exemplary damages, counsel conceded that the husband’s plea of guilty and time in jail was a hurdle. He had served nine months when the maximum penalty is 10 years, having had no prior convictions. Counsel noted that in evidence, the husband had described his daughter’s actions as spying on him, and this was part of a lack of insight and concessions made. A number of the sites are still open. The Court should consider aggravated damages.
Counsel sought to distinguish the case of Wilson & Ferguson [2015] WASC 15 (“Wilson”). This case involved online publication. Unlike this case involving a marriage of 27 years and four children, that case did not. In that case, a post had been made on Facebook only once, and there was no psychological or psychiatric disorder. The applicant received almost $50,000 plus costs.
Counsel noted that in the case of Giller & Procopets [2008] VSCA 238 (“Giller”), Maxwell P had thought that there was a new tort of intentionally causing harm, but the majority did not. Here, there had been attempts at suicide. The wife had attended a psychologist 22 times. She is still working. She should receive damages for the effect on her of the husband’s conduct. She did not get the senior position because she was not up to it. The evidence of Ms Z should be accepted. The case was really an outline of an assessment of damages. Counsel otherwise relied upon his outline of case.
Final submissions of counsel for the husband
Counsel referred to the common law claim and submitted that the cause of action most applicable was breach of confidence. He referred to Giller. No cases would be on all fours. The conduct in that case was submitted to be worse, and Giller was in the upper bands of damages. Wilson followed Giller. In that case, material was shared with work colleagues and the victim was identified. There is no economic loss in this case.
The case of Grey & Motor Accident Commission (1990) 196 CLR 1 precluded an award of exemplary damages because of the jail sentence. General and aggravated damages were available here, but both were compensatory. Counsel acknowledged the significant effect on the applicant. The chronic adjustment disorder was not, however, even moderately severe. The applicant still has her job and a good income and maintains her relationships and is publishing a book, coping generally very well. Counsel conceded that costs would follow the event depending upon the quantum awarded to the applicant.
Otherwise, counsel submitted that the contributions of the parties were equal. The husband earns about half what the wife earns, and his earning capacity is constrained by a criminal record. The future needs favour the husband, even though he was responsible for the end of the relationship. The offer of $50,000 for the applicant in damages was generous, given Dr B’s prognosis.
The damages claim
When counsel first mentioned the matter, I expressed doubt as to whether breach of confidence is, as I described it, a stand-alone tort. I then felt guilty for failing to be aware of its existence. It would appear that the matter has been considered only twice in decisions that have reached the internet, namely, Giller & Procopets [2008] VSCA 236 and Wilson & Ferguson [2015] WASC 15. In Wilson, Mitchell J observed at [73]:
The question I have identified was considered by the Victorian Court of Appeal in Giller, which is the only decision of an Australian superior court considering the issue that I have been able to locate.
Giller was a very different case to this one, involving not only dissemination of intimate material, but also a number of assaults. The three members of the Victorian Court of Appeal who sat in it all differed in various ways with one another, but in respect of the availability of compensation for distress, all three agreed, albeit not entirely for the same reasons. It should be noted that the facts of that case were greatly different to those here, not least because the Court was faced with a case in which the trial judge, whose findings were not reversed, regarded the victim’s distress as relatively minor, she being a person of some resilience. Perhaps it is sufficient for present purposes to refer to paragraph [441] when Neave JA said:
It may be accepted that Ms Giller is a person of some resilience. This does not, in my view, preclude the making of a compensatory award which includes an element for aggravation. The fact that Ms Giller’s friends and family knew that she had had a sexual relationship with Mr Procopets was, in my view, irrelevant to an assessment of the impact on her of knowing that others had seen her actually engaging in sexual activity, just as it would be irrelevant where the parties were married and were therefore known ‘to have had a sexual relationship over many years’. The showing of the video was inevitably humiliating and distressing. Mr Procopets well knew from his telephone conversations with Ms Giller that she was disturbed and upset by his threats. That, evidently, was his purpose. He is fortunate that she appears not to have suffered any lasting injury.
Her Honour went on to quantify the range of damages at [443] -445]. The trial judge had awarded $8000 in total for compensatory and aggravated damages for the dissemination of the videotape, and counsel suggested on behalf of the victim that an award of $250,000 should be made. At [445], Neave JA noted that such an award would be considerably higher than previous awards for distress made in both England and Australia, and went on to say at [446]:
In my opinion, an award in the range of $250,000 would be quite excessive. I would award Ms Giller damages in the sum of $40,000, including $10,000 in aggravated damages.
In Wilson, Mitchell J said at [1] –[2]:
This case involves a claim by the plaintiff against the defendant alleging breach of confidence. The issue raised is how an Australian court exercising equitable jurisdiction should respond to the publication by a jilted ex lover, to a broad audience via the internet, of explicit images of a former partner which had been confidentially shared between the sexual partners during their relationship.
In this case, I am satisfied that such a publication occurred in breach of an equitable obligation of confidence owned by the defendant to the plaintiff. The appropriate relief for the breach of that obligation in the present circumstances is the grant of an injunction prohibiting further publication of the images and an award of equitable compensation. The equitable compensation should include an award to compensate the plaintiff, so far as money can, for the humiliation, anxiety and distress which has resulted from the defendant’s publication of the images, in breach of the obligation of confidence to her.
It should be noted that in that case, it was the plaintiff’s claim that the defendant had deliberately posted the photographs and videos with the intention of harming and distressing her. She claimed that those were indeed the consequences of the postings, and required her to take time off work. It should be noted that the parties in that case both worked at a remote mining operation and that the photographs were disseminated to the plaintiff’s workplace, causing her, very naturally, ongoing concern and distress. There is no question (see [27]-[28]) that the defendant meant to achieve the effect that was achieved, albeit that the photographs and videos were removed from the defendant’s Facebook on the same day that they were posted.
It should be noted in that case the outcome was at [38]:
The publication of the explicit images had the effect on the plaintiff which the defendant evidently intended. When she saw the photographs and videos the plaintiff was absolutely horrified, disgusted, embarrassed and upset. She felt particularly humiliated, distressed and anxious, because she and the defendant both worked at the same site. She concluded (and I infer) that many of the parties’ mutual friends and colleagues would see the photographs and videos.
I note that in that case, the plaintiff was continuing to sleep badly at the time of trial, and had engaged with a psychologist over a serious of sessions to obtain assistance in dealing with her emotional reactions. She continued to feel humiliation and anxiety as a result of the publication (at [42]).
Mitchell J set out at [43]-[54] the principles underpinning an action relating to breach of confidence. His Honour referred to the remarks of Mason J in Commonwealth & John Fairfax & Sons Limited (1980) 147 CLR 39 in the following terms:
The principle is that the court will restrain the publication of confidential information improperly or surreptitiously obtained, or of information imparted in confidence which ought not to be divulged. In addition, Mason J regarded it as necessary to show that there will be an unauthorised use of the information to the detriment of the party communicating it. The existence of a requirement to show detriment has been doubted in subsequent cases.
At [46], His Honour Mitchell J continued:
Essential elements of an action in equity for breach of confidence are that the information was of a confidential nature, that it was communicated or obtained in circumstances importing an obligation of confidence, and that there was an unauthorised use of the information.
At [67]-[85], Mitchell J dealt with the question of equitable compensation and whether or not it was available as a remedy to compensate a plaintiff for non-economic loss comprising the embarrassment and distress occasioned by the disclosure of private information in breach of an equitable obligation of confidence. His Honour noted at [72] two conceptual hurdles:
The first is the common law approach that damages for emotional distress falling short of a recognised psychiatric or psychological injury are available in only limited circumstances. The second is that equitable compensation in Australian cases has, until recently, been awarded only to compensate for economic loss.
Mitchell J then referred to the decision of the Victorian Court of Appeal in Giller and went on to say at [76]:
I do not consider that the decision in Giller can be said to be plainly wrong. It does, in my view, represent a development in the equitable doctrine in Australia.
Mitchell J noted that the present ease with which material can be disseminated on the internet and concluded at [83]:
I am not convinced that the decision of the Victorian Court of Appeal is plainly wrong. To the contrary, I agree with that Court’s conclusion that the equitable doctrine of breach of confidence should be developed by extending the relief available for the unlawful disclosure of confidential information to include monetary compensation for the embarrassment and distress resulting from the disclosure of information (including images) of a private and personal nature.
At [85], Mitchell J concluded, relevantly:
Therefore, in my view, it is appropriate to award the plaintiff equitable compensation for the damage which she has sustained in the form of significant embarrassment, anxiety and distress as a result of the dissemination of intimate images of her in her workplace and among her social group. That compensation award should take account of the fact that the impact of the disclosure on the plaintiff was aggravated by the fact that the release of the images was an act of retribution by the defendant, and intended to cause harm to the plaintiff. The award should also take account of the fact that the plaintiff has not sustained a psychiatric injury, and its amount should not be disproportionate to amounts commonly awarded for pain, suffering and loss of amenity in tortious personal injury cases. In my view, an award of $35,000, to which should be added the plaintiff’s economic loss of $13,404, is appropriate.
Each case necessarily turns on its own facts. The facts as I relevantly find them are that the husband started to post material from 2013 onwards as he says. This is consistent with his underlying theme that this was in part a response to a gradual diminution of intimacy with the wife. He appears perhaps to have started off with the material taken consensually in 2007, but rapidly proceeded to surreptitious means. He knew perfectly well that the wife did not want to be photographed in this way, not least because she smashed his pen camera and then his watch camera. In any event, he would have reasonably known, given her slightly prudish background as described by Dr B, and as I would also find, that this would be extremely hurtful and distressing to her.
There is no doubt that the images were placed on the net by the respondent. He says that this, as it were, happened accidentally. That is simply not quite the case. As he said himself, he got carried away with the responses he got. These responses, which are essentially clearly disgusting, were totally at odds with the respondent’s duty of confidence, which was of course plainly engaged in these circumstances.
Where this case is perhaps slightly different is that I do not find, unlike Giller and Wilson, that the material was posted on the Net with a view to humiliating and upsetting the applicant. The respondent did not intend for her to become aware of these photographs. He described his daughter’s activity in finding them spying. While it would be obvious to anyone, and it would not be necessary to have specialist qualifications to arrive at this conclusion, that the awareness of these posts would be deeply hurtful and distressing to the applicant, he plainly did not post these matters out of revenge or malice as such. He was simply fecklessly selfish and indifferent. Nonetheless, and unlike the cases of Giller and Wilson, these were photographs towards the end of a 27-year relationship which had produced four children. It was an enormous betrayal of trust.
It would appear that in both Giller and in Wilson, the victims of the postings had not had the misfortune to suffer psychiatric illness. Indeed, in Giller, the victim was described as resilient. In this case, by way of distinction, the applicant does suffer from a diagnosed mental illness, namely, chronic adjustment disorder. However, her symptoms are described by Dr B as not even moderately severe, and he thinks that she will recover in a relatively short period of time.
Having seen the extraordinarily distress manifested by the applicant both in the witness box and when she was sitting in the well of the Court, I would, notwithstanding a lack of professional qualifications, somewhat doubt that she will be completely recovered in the three-month time scenario that Dr B posited, notwithstanding his enormous experience. He saw the applicant in August, and it is already October, and if the three-month timeline was right, she will be completely recovered by the time this judgment is given down. I have no doubt that will not be the case. Nonetheless, Dr B is the qualified professional in this matter, and his prognosis accords with commonsense.
Greatly to her credit, the applicant has managed to remain in employment, although she is sufficiently fragile not to have been able to be promoted, and she has the love and support both of her family and the four friends described in the materials. I note exhibit A1, however, shows the continuing depressed mood and generalised anxiety, but I note likewise that Mr H, the psychologist, suggests that her current mental health is much better than when he first saw her. She is still in a fragile psychological state and requires psychological therapy, and indeed that accords with my own observations of her in any event.
Noting the reservations expressed by Neave JA in Giller about the quantum of $250,000 sought in that case, I accept that the claim for $250,000 in this case is grossly excessive. Nonetheless, the circumstances in which the husband’s conduct occurred, in the currency of what was then a subsisting and committed 27-year marriage, the surreptitious way in which most of this material was gained and the active participation, as it were, of the husband in disseminating it and feasting on the offensive responses, leading to an overall outcome wholly offensive to the wife, should give rise to a compensatory award of some $70,000.
I do not propose to disaggregate the question of aggravated damages in this instance. Aggravated damages are, of course, designed to compensate the victim for the hurt and distress that they have suffered, but since the equitable compensation I am granting is designed to address exactly that, it would, in my opinion, be inappropriate to make a separate and additional award.
The applicant’s claim for exemplary damages can be dealt with shortly. In Grey & Motor Accident Commission at [40], Gleeson CJ, McHugh, Gummow and Hayne JJ relevantly said:
Where, as here, the criminal law has been brought to bear upon the wrongdoer and substantial punishment inflicted, we consider that exemplary damages may not be awarded. We say “may not” because we consider that the infliction of substantial punishment for what is substantially the same conduct as the conduct which is the subject of the civil proceeding is a bar to the award; the decision is not one that is reached as a matter of discretion dependent on the facts and circumstances in each particular case.
That is a decisive and authoritarian expression of view by a majority of the High Court in that case, and it is binding on me. I have no power to award the applicant exemplary damages.
I therefore now turn to the rest of the case.
Stanford & Stanford
The Court’s first task is to ascertain the legal and equitable interest of the parties and determine whether a property adjustment is just and equitable. In this case, however, both parties seek such an adjustment on the basis upon which they previously conducted their financial affairs has radically altered. It is plainly just and equitable that there should be a property division.
The pool
The pool consists of:
a)Suburb D property, $600,000.
b)Suburb F property, $300,000.
The liabilities are as follows:
a)Mortgage over Suburb D, $430,510.
b)Loan from applicant’s mother towards purchase of Suburb F property, $27,500.
c)Credit card debts: husband, $28,000.
I have omitted from the parties’ competing lists both their motor vehicles. There is no sworn evidence before me, and in substance, these are merely means of locomotion. I have not included the husband’s shares, as I accept that he has sold them. I have not included the credit card debts of $8000 and the J School fees of $5500. It seems to me these will just have to be paid jointly by the parties.
As it is agreed that there be an equalisation of superannuation, it is not necessary to include these figures, save to note that the vast bulk of the superannuation is in the self-managed superannuation fund in any event.
Contribution
Both these parties worked throughout the relationship, and the husband was generally better paid than the wife. I accept the wife’s evidence that she performed the vast bulk of all the housekeeping and ancillary duties in addition to working. The matter does not rise to the height of a Kennon argument, notwithstanding the husband’s somewhat selfish and lazy approach to his household duties, and I did not understand counsel for the applicant to suggest that it did. Nonetheless, like Dr B, I find that the wife’s history compelling. I suspect that, as Dr B opines, she has under-reported the husband’s conduct. In all the circumstances, I would assess the parties’ contributions as being 55 per cent to the wife and 45 per cent to the husband.
Future needs
The wife’s mental health continues to be a source of concern, and has at least in the previous year caused her not to receive a promotion she would have otherwise received. Nonetheless, she is in stable and secure employment in which she is well regarded. While she remains fearful that persons at the school may access the internet material, the source of all the mischief, that is not perhaps likely. It is certainly not sufficiently probable to be a factor to which I can give any weight. Notwithstanding that her condition may improve over time, she is going to be unwell for an appreciable period of time, and her capacity to advance her affairs will necessarily be impacted by the state of her mental health.
On the husband’s side, he is employed at a substantially lesser wage than the applicant, and his future employment prospects are undoubtedly extremely limited by his criminal conviction. He has said he is in poor health and was certainly labile at times when giving his evidence. Nonetheless, he has called no evidence to support any assertion as to any significant ill health on his part, whether mental or otherwise.
Bearing in mind that the applicant still has three of the children living at home, and doubtless continues to give them love and support notwithstanding that they are now all of adult age, given her love and affection for them, I think that a further adjustment of five per cent in respect to future needs is appropriate.
Just and equitable
In my view, the awarding of 60 per cent of the pool to the wife and 40 per cent to the husband is indeed just and equitable, bearing in mind the overarching effect of the award of damages that I have provided for and the agreed equalisation of superannuation.
Conclusion
I am aware that the wife wishes to move from the former matrimonial home, which has understandably vivid and unhappy memories for her. I will give the parties an opportunity to study these reasons for judgment and hear them as to the form of orders that should be made.
I certify that the preceding ninety four (94) paragraphs are a true copy of the reasons for judgment of Judge Burchardt
Date: 10 December 2019
6
2