The Federal Capital Press of Australia P/L v Thistlewaite, P.

[1993] FCA 355

LIMITED DISTRIBUTION

IN THE FEDERAL COURT OF AUSTRALIA	) )
AUSTRALIAN CAPITAL TERRITORY
) No. ACT G 80 of 1992
DISTRICT REGISTRY	)
GENERAL DIVISION

BETWEEN: THE FEDERAL CAPITAL PRESS

OF AUSTRALIA PTY LIMITED

First Applicant

DAVID IVES

Second Applicant

AND: PAUL THISTLEWAITE

Respondent

MINUTE OF ORDER

JUDGE MAKING ORDER :	Neaves J.
DATE OF ORDER	l June 1993  FEDERAL C O U m OF

AUSTRALIA

WHERE MADE	Canberra
THE COURT ORDERS THAT:
36 of the Federal Court Rules.

1.   The applicants have leave to appeal from the judgment of the Supreme Court of the Australian Capital Territory (Gallop J.) given on 12 November

1992 conditionally upon the applicants filing and

servlng a notice of appeal within 21 days from the
date of thls Order.

2.    In the event of a notice of appeal being filed and served within that period, the costs of the application for leave to appeal be costs in the appeal.

3.    If a notlce of appeal is not so filed and served, the applicants pay the respondent's costs of the application for leave to appeal.

Note:	Settlement and entry of orders is dealt with in Order
IN THE FEDERAL COURT OF AUSTRALIA	)
\
AUSTRALIAN CAPITAL TERRITORY	j
1  No. ACT G 80 of 1992

DISTRICT	REGISTRY	j
1

GENERAL DIVISION )

BETWEEN: THE FEDERAL CAPITAL PRESS

OF AUSTRALIA PTY LIMITED

First Applicant

DAVID IVES

Second Applicant

AND: PAUL THISTLEWAITE

Respondent

C O W : Neaves J.

W: 1 June 1993

REASONS FOR JUDGMENT

The Federal Capltal Press of Australia Pty Limlted

and David Ives, a journalist employed by that company, ("the

Supreme Court of the Australian Capital Territory (Gallop J.)	applicants") seek leave to appeal from the judgment of the
given on 12 November 1992 setting aside an order made by the Master of the Supreme Court on 4 September 1992 that certain further and better particulars be furn~shed to the applicants. Leave to appeal is required by s.24(1A) of the Federal Court
of Australia Act 1976 (Cth).

(a)	had, as a computer speclalist taken an unethical advantage of a particular expertise to extract large payments of money from the public purse;
(b)	had, as a computer speclalist, taken an unethical advantage of a particular expertise to extract large payments of money from his employer;
(c)	had acted in such a way as to give rise to a reasonable suspicion that he had, as a computer

specialist, taken an unethical advantage of a

particular expertise to extract large payments of money from the public purse;
(d)	had acted in such a way as to give rise to a reasonable suspicion that he had, as a computer specialist, taken an unethical advantage of a particular expertise to extract large payments of money from his employer.

12D. Further and in the alternative to paragraph 12C, by reason of certain facts and matters known to many readers of the Canberra Times the third article bore the meanings pleaded in paragraph 12C.

Particulars

(i)The plaintiff was as at April 1988 working on an important computer software project for PISO.

(li) The project had not been completed by that tlme.

(~ii)	Pursuant to a code of ethics amongst computer
specialists it was unethical for a computer specialist to threaten to withdraw from an
incomplete project in which his/her knowledge was
vital so as to obtain a payment over and above what would otherwise have been due in return for completing the project.

(iv)It is alleged that the code of ethics consisted of a standard of conduct prescribed by the Code of Ethics of the Australian Computer Society Inc. and also of a standard of conduct generally expected of computer specialists by reason of custom and usage in the computer industry.

(v) Matters (i) to (iv) were known to the plaintiff's colleagues at PIS0 and to various professional colleagues in the computer industry and public service in the ACT and in particular

(a)	Professor Michael McRobbie of the Centre for Information Science Research, Australian National University, Canberra ACT;
(b)	Professor Robln Stanton of the Department of Computer Science, Australian National University, Canberra ACT;
(c)	MS Lyn O'Connell of the Department of Immigration, Local Government and Ethnic Affairs. Belconnen ACT."

In response to a request by the defendants for further and better particulars in relation to par. (iv) of the particulars appended to par.12D of the Amended Statement of Claim, the solicitors for the plaintiff stated that the ethical standard was embodied in a document described as the "Code of Ethics of the Australian Computer Society Inc. " . A copy of the document was forwarded to the defendants' solicitors. It was further stated that the document "came into existence as a part of the Society Constitution and Handbook by resolution of a Council meeting on the 15th May 1987". The particular provisions of the document on which the plamtiff relies were subsequently identified.

In further correspondence, the solicitors for the defendants asserted that the particulars supplied were	inadequate in a number of respects. Specific mention was made
of the absence of any particulars of the statement in par.(iv) of the particulars that the code of ethics consisted of "a standard of conduct generally expected of computer specialists by reason of custom and usage in the computer industry". Further particulars of the alleged standard were requested in the following terms:

" (i)	What are the facts, matters and circumstances you rely on for the existence of such a standard;
(11)	How did the alleged standard come to arise;

(iii)   Is lt embodied in a document? If so, please provide us with a copy of same.

(1V) Is the alleged ethlcal standard set by a professional body? If so, is it set orally or in writing? If set in writing, please provide us with a copy of same. If oral, please give details in the same manner as in respect of a contract."

By letter dated 1 July 1992, the solicitors for the

plaintiff responded to that request in the following terms:

"(l) Thls is a matter of evidence.

(ii) By custom and usage in the computer industry.

(iii) No.

(iv)Not apart from that promulgated by the Australian Computer Soclety, Inc."

Upon the solicltors for the plaintiff affirming in letter dated 1 July 1 9 9 2 were "more than adequate", the	later correspondence that the particulars supplied in the
question whether the defendants were ent~tled to the further particulars sought was lltlgated before the Master with the result to which reference has already been made. The basis upon which the Master ordered that further particulars be supplied appears from the follow~ng passage from his reasons for decision:

"So far as the flrst part of part~cular (iv) 1s concerned, a copy of the wrltten code of ethics of the

Australian Computer Society Inc has been supplied by the

plaintiff to the defendant. The argument turns about whether further particulars need to be supplied of the following allegation. It seems to me that that is an allegation which is additional to, and separate from, the wrltten code; and whether there is a code of ethics which contains that unwritten rule of conduct whlch is referred to is not a slmple fact to be proved by such evidence as the plalntiff may choose to call, but is a matter which will ultimately need to be lnferred by the court from the existence of facts and circumstances.

Those facts and clrcumstances may themselves be proved by such witnesses, or the tender of such things as the plalntiff may choose. It seems to me that the defendant is entitled to particulars of what is golng to be proved. I therefore order the plaintiff to supply particulars of the facts, matters and clrcumstances relled upon, apart from the existence of the written code of ethics referred to in paragraph 12D of the particulars [sic]. I order that those particulars be supplied wlthin 21 days. If they are not supplled within 21 days, I further order that the words 'And also of a standard of conduct generally expected of computer specialists by reason of custom and usage in the computer industry' be struck out of the pleading."

The matter then came before Gallop J. In his
reasons for judgment, hls Honour, after referring to Slms v

Nran [l9841 1 NSWLR 317 at p.321, Ph~lllponi v Leithead (1959)

SR (NSW) 352 at p.359 and Bailey v Federal Commissioner of "The Master took the view that the standard of conduct referred to in particular (iv) of para.12D was additional to and separate from the wrltten Code, that whether there is a Code of Ethics which contains that unwritten rule of conduct is something which the plaintiff will have to prove by evidence and that the existence of that unwritten rule of conduct will be determined by inference from the existence of facts and circumstances. Accordingly he held that the defendants are entitled to particulars of what 1s going to be proved. Taxation (1977) 136 CLR 214 at p.219, sald:

Having carefully considered the submissions put on behalf of the defendants, I do not agree that particular (iv) pleads any different standard of conduct. Paragraph 12D( 111) pleads the standard of conduct and para. l2D(iv) pleads the sources of that standard. In my view the defendants are not entitled to any further particulars than those already furnished. They know the case that the plaintiff will seek to make and they cannot be taken by surprise on the particulars already furnished.

Notwlthstanding that this appeal is a review of an exercise of discretion by the Master (Bailey v Federal

Commissioner of Taxatlon (1977) 136 CLR 214 per Gibbs J.

at 219), it is just~flable to overrule the Master's decision because, in my view, he has acted on an error of principle. The error of principle was in ordering the plalntiff to supply by way of particulars the evidence on which he relies to prove paras.l2D(iil) and (iv).

That the standard of conduct relled upon by the plaintiff is to be established by evidence 1s embraced in the defendants' submission on the appeal that where a custom is alleged, the custom would have to be established by evidence. The extent of knowledge of custom or usage, if found, w ~ l l be relevant to the question of damages so that precise proof of the nature of the facts to establish the custom or usage and thereby delineating the extent of the custom will be necessary. Clearly those are matters of evidence."

Accordingly, hls Honour allowed the appeal and set aside the order of the Master.

In support of the appl~catlon for leave to appeal submitted that the matter raises two important questions	from the judgment of Gallop J., counsel for the applicants
warranting cons~deration by a Full Court of this Court. The first is whether a plalntiff who clalms damages for defamation and pleads a true ~nnuendo based upon extrinsic facts known to particular readers of the published words, the extrinsic facts being a standard of conduct grounded in custom and usage in a particular trade, industry or calling, is required to give particulars of the facts, matters and circumstances upon which the Court at trial is to be asked to infer the existence of such custom or usage. Reference was made to Majeau Carry~ng
Co. Pty Ltd v Coastal Rutile Ltd (1973) 129 CLR 48 per Stephen J. at pp.60-1 and Phipson on Evidence, 13th ed., par. 9-30.
The second question is whether, the Master's decision having been glven upon a matter of practice and procedure, this was an appropriate case in which Gallop J. should have interfered with the exercise by the Master of the discretion vested in him. It was submitted that Gallop J. was in error in concluding that the Master had erred in principle and in identifying that error as the error of "ordering the
plaintiff to supply by way of particulars the evidence on
which he relies to prove paras lZD(ii1) and (iv)". It was submitted that there was no relevant principle of law requiring that a proper request for particulars is to be denied on the ground that to require the particulars to be given would disclose the evidence, or part of the evidence, by
which the allegation of which particulars are sought 1s to be proved.
It was further submitted on behalf of the applicants that the particulars requested were necessary to enable the applicants to be adequately informed of the case they have to meet at the trial and that substantial injustice would be suffered unless the particulars were ordered to be given in the sense that the proper preparation for the trlal would be impeded.

Counsel for the respondent opposed the granting of

leave on two grounds:

(a)	that the judgment of Gallop J. was itself an exerclse of d~scretion in relation to a matter of plead~ng and no sufficient ground had been shown for this Court to interfere; and
(b)	that the judgment of Gallop J. was clearly correct.

Notwithstanding that the questions are properly described as ralslng matters of practice and procedure and relate to the exercise of a d~scretionary judgment, I am of opinlon that they ralse issues of sufficient importance to warrant consideration by a Full Court of this Court. I am further of opinion that there is sufficient doubt as to the correctness of the judgment from which the applicants seek to appeal to warrant leave to appeal being granted. I am also satisfled that the interests of justlce requlre that the

question whether the applicants are entitled to the	particulars sought should be resolved before the action comes
to trial so as to avoid the possibility of an application for an adjournment at that stage of the proceeding.
Leave IS, therefore, granted to the applicants to appeal from the judgment of the Supreme Court (Gallop J.) given on 12 November 1992 conditionally upon the applicants filing and serving a notice of appeal within 21 days from the date of thls order. I further order that, in the event that a notice of appeal is filed and served withln that period, the costs of this application be costs ln the appeal. If no notice of appeal is so filed and served, the appllcants are to pay the respondent's costs of this application

I certlfy that this and the preceding 9 pages are a true copy of the Reasons for Judgment herein of the Honourable Mr Justice Neaves .

Dated: 1 June 1993

Counsel for the applicants : Mr B.A.M. Connell

Solicitors for the applicants : Macphlllamy Cummins & Gibson

Counsel for the respondent : Mr R. Crowe

Solicitors for the respondent : Pamela Coward & Associates

Date of hearlng	: 4 March 1993
Date of judgment	: 1 June 1993