The Queen v Gaudry
[2021] VSC 113
•12 March 2021
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
MAJOR TORTS LIST
S ECI 2020 03613
| THE QUEEN (ON THE APPLICATION OF WAYNE ANDREW LESLIE CREWES, EILEEN FRANES CREWES AND TOMI TREGENT-CREWES) | Applicants |
| v | |
| ANTON JEROME FREDERICK GAUDRY | Respondent |
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JUDGE: | John Dixon J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 22 February 2021 |
DATE OF JUDGMENT: | 12 March 2021 |
CASE MAY BE CITED AS: | The Queen v Gaudry |
MEDIUM NEUTRAL CITATION: | [2021] VSC 113 |
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CONTEMPT OF COURT – Alleged sub judice contempt – Extant civil proceedings – Communications sent by litigant to opposing parties and potential witness – Communication alleged to have inferred recipients would be jailed – Consideration of the text and circumstances of the communications - Whether communications interfered with the due administration of justice in the extant proceedings – Whether communications improperly pressured recipients to discontinue or compromise the litigation.
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APPEARANCES: | Counsel | Solicitors |
| For the applicants | Mr A Herskope with Mr S Freire | Kalus Kenny Intelex |
| For the respondent | Mr A Woods with Mr M P Allen | Burch & Co Lawyers Pty Ltd |
TABLE OF CONTENTS
Introduction........................................................................................................................................ 1
The impugned communications..................................................................................................... 1
Relevant background........................................................................................................................ 4
Applicants’ contentions.................................................................................................................... 7
The Greenberg email tender...................................................................................................... 11
The apology.................................................................................................................................. 15
Relevant principles.......................................................................................................................... 16
Analysis.............................................................................................................................................. 18
Conclusion......................................................................................................................................... 25
Annexure A – The Age article........................................................................................................ 27
HIS HONOUR:
Introduction
The plaintiffs, Wayne Crewes (‘Crewes’), Eileen Crewes and their daughter, Tomi Tregent-Crewes, applied for declarations that Anton Jerome Frederick Gaudry (‘Gaudry’) be adjudged guilty of contempt of this court by sending:
(a) an email to Mr Darren Rogers (blind copied to Crewes) on 13 August 2020 at about 9:28pm, with the subject ‘Jail for Financial Deception’; and
(b) an email to Ms Crewes (blind copied to Ms Tregent-Crewes and Sasha Elma Mort) on 14 August 2020 at about 3:41pm, with the subject ‘Jail for Financial Deception’.
The applicants’ contention was that the purpose of these communications was to intimidate the recipients and to improperly interfere with the due administration of justice and the conduct of Supreme Court proceeding numbers S ECI 2020 02306 and S ECI 2020 03224 (‘Commercial Court proceedings’).
The hearing was limited to whether Gaudry should be adjudged guilty of contempt and punished, with the issue of sentence, if needed, being reserved to a later time.
The application was based on affidavit evidence from Crewes, Ms Crewes and each of their daughters, Ms Tregent-Crewes and Ms Mort. Gaudry relied on an affidavit sworn by his solicitor on the basis of information and belief. All affidavits were tendered without objection and no deponent was cross-examined. The applicants also sought to rely on an email dated 6 September 2020, which is discussed later in these reasons.
The impugned communications
The ‘first email’ stated:
From: [email protected]
Date: 13/8/20 9:28 pm (GMT+10:00)
To: [email protected]
Subject: Jail for Financial Deceptiontype="1">
The ‘second email’ stated:
From: [email protected]
Date: Fri, Aug 14, 2020 at 3:41 PM
Subject: Jail for Financial Deceptiontype="1">
For convenience I will refer to both emails collectively as the ‘August emails’. The hyperlinked article, identical in each case, is reproduced as Annexure A to these reasons (‘The Age article’).
Two matters are not in contest. First, Gaudry admitted that he sent the August emails using his wife’s email address. Secondly, the first email was blind copied to Crewes and the second email was blind copied to Ms Tregent‑Crewes and Ms Mort.
In his first affidavit made on 26 August 2020, Crewes did no more than observe that he had received the first email. In a second affidavit sworn 29 October 2020, Crewes expanded upon that observation, stating:
5.When I received the [first email], I opened it and read “The Age” article... When I read the [first email], I read it to be a threat that if I did not give up or settle the litigation, I would be going to jail for alleged dishonesty.
6.The next day, my daughters contacted me. Each of them told me that they had received an email. I was aware that Mr Gaudry's company had sued my daughters, accusing them of conspiring with Eileen and me. I was worried for my daughters, and in particular my daughter Sasha Mort, who was around 34 weeks in her pregnancy and wasn’t well, and was already under stress. The state of her health was causing me considerable distress. I was worried about the effect that the email would have on Sasha and her unborn child given the fragile state of her health.
7.I also took the threat to be part of a strategy to intimidate me into settling the litigation on terms dictated by Mr Gaudry. Mr Gaudry had already made a previous threat to me, in an email on 28 June 2020. The email is marked without prejudice and forwarded an email dated 26 June 2020, in which Mr Gaudry set out the basis upon which he sought to settle the litigation.
In her first affidavit, Ms Crewes gave evidence of receiving the second email at about 3:41pm on 14 August 2020. In her second affidavit sworn 29 October 2020, she stated:
4.When I received the [second email], I opened it and read “The Age” article...
5.I felt threatened and intimidated when I read the article.
6.On the day I received the email, my daughters contacted me and told me that they had received the same email. I was extremely upset that an email of that kind had been sent to them, especially in the case of Sasha who, at that stage, was 34 weeks pregnant and feeling very unwell.
7.I was aware from conversations I had with my husband that he and Mr Kenny had had without prejudice communications in an attempt to settle the litigation with the Gaudry camp. Because of those conversations, I felt that the email had been sent to me and my daughters to intimidate us, and so that we would then would pressure my husband to settle the litigation on whatever terms were dictated by the Gaudry camp.
In her affidavit dated 26 August 2020, Ms Tregent-Crewes stated she received the second email at about 3:41pm on 14 August 2020. It was the first communication she had received from Ms Gaudry (who was then understood to have sent the August emails), and Ms Tregent-Crewes did not know how she had obtained her email address. In her second affidavit sworn on 28 October 2020, Ms Tregent-Crewes stated:
6.When I received the [second email], I opened it and read “The Age” article … which was about a former sky rail manager jailed for nine months after pleading guilty to two charges of obtaining a financial advantage by deception and one of dealing with property suspected of being the proceeds of crime for operating a “wage racket”.
6. At first I was confused and thought that was not what I was being accused of in the litigation in which I am a defendant and I had not been involved in any such thing.
8.I considered that the email was a threat that I could go to jail. I felt upset and scared, as my parents had told me that they were involved in nasty litigation with Mr Gaudry to which my sister and I had been made parties.
In her first affidavit dated 27 August 2020, Ms Mort also stated that she received the second email and that, prior to its receipt, she had never had any communications with Ms Gaudry and did not know how she had obtained her email address. She stated that she was eight months pregnant and had not been well, and that her circumstances did not permit her to participate in this proceeding as an applicant. As with the other members of her family, she expanded upon her reaction on receipt of the email in a second affidavit. Ms Mort stated:
6.When I received the email, I was about 34 weeks pregnant and was also looking after my 20 month old daughter. As a result, I was going through a stressful time.
7.When I received the email I opened it and read the article...
8.When I did so my stomach dropped and a feeling a panic came over me. I thought I was being accused of something I did not do.
9.I also thought that the person who has sent this to me is threatening me.
The court was constrained in assessing this evidence because the recipients were not cross-examined. The applicants relied on the responses of the recipients to receiving the email, emphasising the fact that they personally felt they were placed under improper pressure to resolve the Commercial Court proceedings by threats.
It is not readily apparent why a recipient who had not been involved in, been investigated for, and had not been charged with, criminal conduct would feel threatened, or upset, or scared by being referred to an article that was unrelated to their circumstances. The contemptuous purpose or intent alleged against Gaudry is not explicitly stated in the email and the applicants’ submissions acknowledged as much. The question of whether the communication, as a matter of practical reality, manifested a real and definite tendency to interfere with the course of justice can only be assessed in the context of all of the relevant surrounding circumstances. It is necessary that I set out some background.
Relevant background
Crewes and Ms Crewes are the directors and shareholders of Tomi-Sasha Holdings Pty Ltd (‘TSH’). In December 2017, TSH borrowed monies from NTM Super Holdings Pty Ltd (‘NTM’), Gaudry’s company. Mr Darren Rogers facilitated the loan, which was secured. The loan, together with any accrued interest owing, was repayable on 1 July 2018.
Defaults, including non-payment of the loan on the due date, were alleged against TSH. On 18 May 2020, NTM, acting pursuant to its security, appointed a receiver and manager to TSH. On 25 May 2020, the receiver commenced the first of the Commercial Court proceedings, alleging that:
(a) assets from TSH, in breach of their duties as directors and in breach of the loan and security agreements with NTM;
(b) Crewes and Mrs Crewes had conspired, by a common intention, to diminish the value of NTM’s security by unlawful means (being the breach of the security document and/or breach of their directors’ duties) to cause economic harm to NTM;
(c) immediately after Crewes was informed of the receiver’s appointment, TSH transferred further assets to Ms Tregent-Crewes and Ms Mort for no or insufficient consideration; and
(d) Ms Tregent-Crewes and Ms Mort therefore aided, abetted, and were knowingly concerned with, and assisted their parents in, the breaches of directors’ duties and, further and alternatively, were also parties to the conspiracy, having the common intention of inflicting economic harm upon NTM by unlawful means, by reducing the value of its security.
For present purposes, it is unnecessary to explain the allegations in that proceeding in any greater detail. Relevantly, the proceeding is not a criminal proceeding and there is no suggestion that the transactions are the subject of investigation by law enforcement. To the contrary, the proceeding has a strong commercial flavour, albeit with the addition of allegations based on the intentional tort of conspiracy to cause economic harm by unlawful means.
Notwithstanding that they had each engaged solicitors, Gaudry and Crewes communicated directly with each other, including by text message and email. The applicants contended that on 28 June 2020, following the receiver’s inability to secure a freezing order on an ex parte basis, Gaudry sent Crewes the following message (’28 June email’), which Crewes contended significantly assisted in understanding the context in which the August emails, were both sent and read:
Hi Wayne
I got your text. I prefer email.
Below is an email I drafted Friday. I always draft such emails, then sit and think overnight. In this case I did not send. I guess I have come to the conclusion there is little chance of settling this given the personalities involved. Further, I don't believe I need to 'negotiate' a position which is simply about paying me what I am owed. I've concluded the only reasonable person I can turn to is a judge. My faith in justice is diminished, but not totally.
I think you either accept the below figure or you don't. If not, then we are headed to court. This will cost an extra $700,000 minimum.
I am not sure why lawyers had to get involved. You owe someone money, you pay them. I am a handshake guy. Some people have other ideas.
Kenny may think he is brilliant. He may be a great lawyer. But, he does not understand me. He'll end up costing you $500,000 due to his antics.
I don't know about your offer until I discuss it with Pat Lennon. Money talks, for sure. He might want a 2nd mortgage over Cape Schanck. You have the option of including Buller, Blairgowrie. As I say below, the security you provide must make you "uncomfortable", otherwise, we will not accept the proposal. Kenny has set the scene. Everything you propose will be judged in that context. There is no trust ... that is the context you must submit an offer.
I always thought this was about the next 5 years for you. If this goes to court, it's hard to see how MIL can continue to employ you. So much will get aired. And, I honestly don't know how or what a 'win' in court looks like for you. A 'win' for me is very clear.
We are aware of your 3 years ASIC ban in 1994. Are your kids aware? This will obviously come out in court. It will be public knowledge again.
As you can see from my email on Friday, I am done. It's straight to court ... unless we resolve by 5.00pm Monday. You are correct, a very big week is planned. Strategically, we will certainly be 'upping the ante'.
Thanks, Anton
---------- Forwarded message ---------
From: ANTON GAUDRY <[email protected]>
Date: Fri, 26 Jun 2020 at 17:26
Subject: crewes
To: ANTON GAUDRY <[email protected]>
without prejudice
Hi Wayne
We are clearly not making any progress.
I am a simple guy.
You owe me X, you pay me X.
OK, you said you owe me Y. I disagree, but for the sake of sanity, I accepted your offer. That was a BIG WIN for you. I expected you to go out of your way to pay me Y. You or your lawyers had other ideas.
[redacted]
I am done with games. I am done with ‘negotiations’. I am done with lawyers.
[redacted]
In the past 3 months I have lodge 3 writs in the Supreme Court. John Hendriks, Clint Bartram and James Bawden. Up to you if you think I am bluffing.
I can't advise you, but you have an opportunity. Now up to you if you take it.
Anton[1]
[1]Although the email was headed ‘without prejudice’, there was no objection to its admission into evidence in its redacted form.
Soon after this communication, NTM appointed administrators to TSH. Crewes and Ms Crewes responded with the second of the two Commercial Court proceedings, challenging that appointment. An interlocutory process in that second proceeding came before this court on 13 August 2020, when another judge, having received certain undertakings from Crewes and Ms Crewes, restrained the administrators, until trial, from taking any further step in the administration of TSH. The first email was sent that evening at 9:28pm and the second email at 3:41pm the following day.
This proceeding was commenced by originating motion filed 15 September 2020. The Commercial Court proceedings continue to progress through their interlocutory stages towards trial.
Applicants’ contentions
The applicants contended that, when looked at objectively, the August emails carried with them insinuations of dishonest criminal conduct by each of the recipients — for which each of them was exposed to the risk of a possible custodial sentence — in the transactions the subject of the Commercial Court proceedings. The evidence exposed Gaudry’s determination to conduct the litigation in an unduly aggressive fashion, to dictate terms of settlement that he considers suitable, and to exert pressure on Crewes by means of threats and intimidation to achieve his desired outcome.
They submitted that Gaudry’s purpose in sending the August emails, objectively assessed, was obvious: to threaten and intimidate each of the recipients in connection with the claims that were the subject of the litigation. They carried with them the veiled threats that Gaudry would see to it that each of the recipients would face criminal charges and would be liable to imprisonment.
The applicants further submitted that Gaudry’s conduct overall was a despicable and morally repugnant display of overt aggression, menace and bullying. Notwithstanding the opportunity to reflect overnight, after sending the first email, on the wisdom of what he had done — a practice he apparently subscribes to — Gaudry amplified his threat by sending the same email the following afternoon to Ms Crewes, Ms Tregent‑Crewes and Ms Mort. The second email was a collateral means of imposing pressure on, and extracting leverage against, Crewes, as the court could be satisfied that Gaudry’s commercial dealings both initially, when the loan was made, and later, after the dispute started, were with Crewes, not other members of his family.
The applicants contended that as the August emails were calculated to cause each recipient to wonder whether they had engaged in dishonest criminal conduct as had been insinuated, for which they might be sent to jail, the communications had the tendency to improperly interfere with the due administration of justice by placing pressure upon the Crewes family to:
(a) dissuade them from continuing with the litigation;
(b) dissuade them from giving evidence at any trial which might be unfavourable to NTM; and/or
(c) bring them to heel to focus pressure on Crewes to submit to whatever settlement terms Gaudry saw fit to impose.
I pause to note that I cannot accept the applicants’ submission that the emails carried clear imputations, or allegations, of dishonest criminal conduct by each of the recipients in the transaction the subject of the Commercial Court proceedings, for which each of them was exposed to a possible risk of a custodial sentence. On their face, neither email appears intimidating or discloses the asserted meaning, or any tendency to improperly interfere with the due administration of justice. Any of the recipients might have independently seen and read The Age article, either online or in the newspaper.
The meaning contended for by the applicants can only be drawn from the emails by a reader appraised of other facts or with other knowledge. Such meanings must be carried by the communications as true innuendo, in the sense recognised in the law of defamation.[2] That is not to say that the communication cannot have the relevant tendency. Rather, it is to focus on how the applicants must demonstrate that tendency to the requisite standard.
[2]Radio 2UE Sydney Pty Ltd v Chesterton (2009) 238 CLR 460, 481 [51].
The applicants submitted that there were facts extraneous to the emails that established both the tendency alleged and Gaudry’s purpose in sending the emails. The applicants noted the references to a possible job loss for Crewes and public disclosure of an ASIC ban imposed on him in 1994, but their reasoning drew primarily on the 28 June email, particularly the statement that ‘strategically, we will certainly be “upping the ante”’. They submitted that it was the sending of the August emails that upped the ante.
Consideration of the substance of The Age article was essential to the applicants’ contentions for the email itself is innocuous, even though the subject of each was ‘Jail for financial deception’. That statement acquired particular meaning on following the hyperlink and reading the article.
The Age article reported on the conviction and jailing of Mr Kory Oxley, a former Lendlease manager engaged on the ‘sky rail’ construction project in south-east Melbourne in 2018. Mr Oxley was convicted on charges arising from what is referred to as a ‘wage racket’, which included receiving cash ‘kickbacks’ for causing subordinates to be paid for days they did not work, and for providing employees — described as taxpayer funded labourers — to renovate a colleague’s home. According to the article, Mr Oxley was jailed for nine months on two charges of obtaining a financial advantage by deception and one charge of dealing with property suspected of being the proceeds of crime. The offending was described by the sentencing judge as ‘serious dishonesty offending’.
The applicants contended there was no possible rationale for Gaudry to ‘go out of his way’ to find the email addresses of Ms Crewes and her daughters, other than to exert improper pressure to achieve the outcomes I have already referred to.
During argument, I invited a submission from the applicants as to why a reader of the August emails would relate the allegations in The Age article to the allegations in the pleadings as neither the material filed, nor the written submissions, identified with precision any particular facts known to the applicants and Ms Mort that would lead a reasonable person (knowing those facts) to conclude that the emails disclosed a tendency to improperly interfere with the due administration of justice by improperly pressuring members of the Crewes family.
First, to explain the relationship between the conduct alleged in the first of the Commercial Court proceedings and the criminal conduct alleged in The Age article, the applicants pointed to allegations in the statement of claim in that proceeding (repeated in relation to different transactions), an example of which was:
78.In facilitating the Fifth Transfer, [Crewes] and/or [Ms Crewes]:
(a)failed to act in good faith in the best interests of TSH, in breach of his/her director’s duties under s 181 of the Corporations Act 2001 (Cth);
(b)improperly used his/her position to gain an advantage for himself/herself or someone else and caused detriment to TSH, in breach of his/her director’s duties under s 182 of the Corporations Act 2001(Cth);
(c)failed to exercise his/her powers to discharge his/her duties with the degree of care and diligence that a reasonable person would exercise if they were a director of TSH, in breach of his/her director’s duties under s 180 of the Corporations Act 2001 (Cth); and
(d)further and alternatively, each aided, abetted and was knowingly concerned with and assisted the other in the breaches of his/her director’s duties.
79.[Ms Mort] aided, abetted and was knowingly concerned with and assisted the [Crewes] and/or [Ms Crewes] in the breaches of his/her director’s duties in relation to the Fifth Transfer.
80.Further and alternatively, [Crewes, Ms Crewes and Ms Mort] had the common intention, by the unlawful means of the breach of the GSA and/or breach of their directors’ duties, to engage in the Fifth Transfer as a result of which:
(a) TSH would suffer economic loss; and/or
(b)NTM would suffer economic harm in so far as the value of its security under the GSA would be reduced.
Secondly, the applicants sought to tender, and rely on, a further email sent by Gaudry on 6 September 2020 (‘Greenberg email’) pursuant to the tendency rule. That tender was rejected and it is now convenient to state my reasons.
The Greenberg email tender
The Greenburg email was sent by Gaudry to several recipients, including one Mark Greenberg. After several paragraphs that are not presently relevant, Gaudry wrote:
Peter F got caught again. Poor bloke. He must have known something was up. He looks like he's been in a good paddock.
Attached to the email was a copy of a newspaper article headed ‘In the news – Peter Foster – serial fraudster’ and ‘Return of a global mischief maker’. The article reported that Foster had been arrested, charged and remanded into custody in connection with an alleged betting scam. It stated that the charges he faced concerned alleged dishonest conduct, namely publishing false and misleading material, dishonestly obtaining financial advantage by deception and knowingly dealing in proceeds of crime with an intent to conceal.
Peter Foster was a well-known fugitive. The Greenburg email was not directed at any member of the Crewes family and did not concern the litigation between Crewes and Gaudry. Although it came to Crewes’ attention via Mr Rogers on 24 November 2020, how and why that occurred was unexplained.
The applicants sought to rely on the Greenberg email as evidence of Gaudry’s tendency to act in a particular way, namely to make implicit threats or insinuations of dishonest or criminal conduct against persons with whom he is in dispute by sending articles from The Age, so as to improperly pressure the recipient in connection with that controversy.
The initial question is whether the Greenberg email is relevant. The fact in issue in the proceeding is whether the August emails had a tendency, or were calculated, to cause each recipient to hold a genuine belief that he/she was threatened with a prospect that they (or any one of them) could go to jail on the basis of the conduct that had been put in issue in the commercial court proceedings and in that way to place improper pressure on a litigant in a proceeding thereby interfering with the proper administration of justice.
If relevant, the question then arises as to whether it is of ‘significant probative value’ so as to make it admissible under s 97 of the Evidence Act 2008 (Vic). That question involves an assessment of whether Gaudry’s conduct in sending the Greenberg email possesses sufficient common or similar features to his conduct in sending the August emails, so as to demonstrate a pattern of conduct that cogently increases the likelihood of the respondent having committed the contempt.[3]
[3]Velkoski v R (2014) 45 VR 680, 682 [3], 718–20 [162]–[173].
The relevant aspect of whether the respondent committed the contempt is not a tendency of Gaudry to send emails with newspaper articles about criminal conduct to persons with whom he is in dispute, because Gaudry admitted that he sent the August emails and that issue was not in dispute. It is rather the question of whether the Greenberg email is relevant to whether Gaudry had the necessary tendency by sending such emails and annexures to impose improper pressure on persons with whom he is in dispute.
As I stated earlier, the question of whether the August emails had a tendency to impose improper pressure in a manner that interfered with the due administration of justice cannot be determined without knowledge of particular extraneous facts. That is also the case in respect of the meaning to be drawn from the Greenburg email, particularly what knowledge the recipient had of the nature of the issues in dispute between Gaudry and Mr Greenberg and the relationship between the two men generally. The tendency of the Greenberg email must first be identified before it can be shown to be both relevant to the August emails and of sufficient probative value in connection with the alleged tendency of those emails.
No evidence touched on such matters. Rather, the court was invited to assume the tendency to improperly exert pressure to capitulate to Gaudry’s demands was made out from the content of the email and the applicants focussed instead on the salient features of similarity.
I pause to observe that, on this question, the applicants sought to rely on the affidavit of Michael Jonathan Kenny sworn 16 February 2021, which, although included in the court book, was not read into evidence at the trial. However, references are made to it in an outline of contentions in relation to admissibility of tendency evidence upon which the applicants relied without objection. In these circumstances, I accept Mr Kenny’s affidavit as read and relied on by the applicants without objection or a requirement that he attend for cross‑examination. That said, the affidavit does not take further the issue of the particular extraneous facts that might elucidate the tendency contended for in respect of the Greenberg email.
The applicants identified what they submitted were five salient features of similarity between the Greenburg email and the August emails:
(a) they were sent by the respondent to persons with whom he was in dispute;
(b) they referenced media reports of other persons being imprisoned in cases involving alleged or admitted dishonest criminal conduct;
(c) the cases the subject of the media reports were of no apparent connection to the disputes at hand;
(d) taken as a whole, they carried with them the insinuation that one or more of the recipients had engaged in dishonest criminal conduct for which they might be imprisoned; and
(e) they were proximately timed, having been sent within a month of each other.
A number of documents produced by Mr Greenberg in answer to a subpoena were included in the court book, which the applicants appeared to contend were admissible as business records pursuant to s 48 of the Evidence Act.[4] These documents were not proved by affidavit or put to any witness. Although the applicants made some reference to them, their relevance was not explicitly identified. Gaudry accepted their tender for the restricted purpose of rebutting character evidence, not as evidence of extraneous facts that explain the meanings carried by the Greenberg email.
[4]I say ‘appeared’, as although no submission was advanced about those documents, the written submission contended that the Greenberg email was a business record.
However, assuming tender for all purposes, the subpoenaed documents, not being explained by any person with knowledge of the circumstances in which they came into existence, raise more questions than they answer, such that the court cannot determine what extraneous facts were understood by Mr Greenberg so as to give to the email the character contended for by the applicants. That inquiry is not possible or appropriate, being remote from the issues raised for determination.
The applicants pointed to the following statement from the 28 June email as supporting the inferences contended to be drawn from the Greenberg email:
In the past 3 months I have lodge [sic] 3 writs in the Supreme Court. John Hendriks, Clint Bartram and James Bawden. Up to you if you think I am bluffing.
While this statement supports the contention that there was litigation between Gaudry and the named persons, one of whom (Hendriks) was copied into the Greenberg email, a finding about external facts that may give the Greenberg email the meaning contended for by the applicants is a collateral issue that cannot be determined on the evidence.
Consequently, the Greenberg email cannot be shown to rationally affect (directly or indirectly) the assessment of the probability of the existence of the relevant fact in issue in the proceeding. It follows that the Greenberg email, on its face, cannot rationally, even indirectly, affect the assessment of the probability of the existence of the tendency contended for by the applicants. The Greenberg email is neither relevant as tendency evidence, or, if it were, it is not of sufficient probative value to be admissible. It is not relevant on any other basis so its status, or lack thereof, as a business record does not arise. Neither need I resolve whether s 101 of the Evidence Act applies in this proceeding.
The apology
Maintaining his denial of the charge of contempt, Gaudry conceded that in hindsight sending these emails was ill-considered and imprudent and caused upset to the applicants. He accepted that his conduct was regrettable. Gaudry described his conduct as an error of judgment. This concession was appropriately made.
Gaudry offered an apology of sorts. On 23 November 2020, his solicitors wrote to the applicants’ solicitors in the following terms:
We refer to the above proceedings and the Respondent’s Outline of Contentions filed and served today (Contentions) relating to the emails sent to your clients containing an internet link to an online article of The Age newspaper, dated 13 August 2020 (the Emails).
While, as set out in the Contentions, the charge of contempt is denied, Mr Gaudry wishes to nevertheless apologise for his error of judgement in forwarding the Emails and for the upset they have caused the Applicants.
In light of this apology, and having regard to the matters raised in the Contentions, we invite you to formally withdraw the charge of contempt. In extending this invitation, we acknowledge that it is entirely a matter for your clients as to whether they choose to withdraw or proceed with the charge.
We look forward to hearing from you.
There is no expression of remorse or contrition beyond this letter and, properly construed, the error of judgment Gaudry wishes to apologise is not having committed a contempt of court, but rather his error of judgment in inappropriately invading the privacy of, and causing upset to, the recipients, who perceived his communication to be threatening.
The applicants did not accept the apology and have proceeded to trial. In this context, the apology is of no present relevance, except perhaps to restate the respondent’s submission that while the August emails may have been imprudent and upsetting from the applicants’ perspective, they are not proof — in practical sense — of a real tendency to exert improper pressure on the applicants in relation to the Commercial Court proceedings.
Relevant principles
The foundation of any charge of contempt of court is the capacity of the impugned conduct to interfere with the due administration of justice.[5] Proceedings for a declaration that a person be adjudged guilty of contempt are considered criminal in nature, and an applicant must prove each element of the charge beyond reasonable doubt.[6] Conduct by a communication that, as a matter of practical reality, interferes with the due administration of justice by materially interfering with the course of justice in a particular case is classified as sub judice contempt.
[5]A-G v Times Newspapers Ltd [1974] AC 273, 315 (‘A-G v Times Newspapers’); Witham v Holloway (1995) 183 CLR 525, 538–9 (‘Witham’); Australasian Meat Industry Employees’ Union v Mudginberri Station PtyLtd (1986) 161 CLR 98, 106; The Queen v Hinch [2013] VSC 520.
[6]Hinch v Attorney-General (Vic) (1987) 164 CLR 15, 49–50 (‘Hinch’); Witham, 534 (n 5).
In this proceeding, the applicants must prove beyond reasonable doubt the following two elements:
(a) the respondent sent the August emails to the recipients; and
(b) as a matter of practical reality, the August emails had a real tendency to interfere with the due administration of justice.[7]
[7]John Fairfax & Sons Pty Ltd v McRae (1955) 93 CLR 351, 370, 372 (‘John Fairfax & Sons’); Victoria v Australian Building Construction Employees’ & Builders Labourers’ Federation (1982) 152 CLR 25, 56, 99, 166; Hinch, 28, 57, 70 (n 6); A-G (NSW) v John Fairfax & Sons Ltd (1985) 6 NSWLR 695, 697, 708; A-G (NSW) v Mayas Pty Ltd (1988) 14 NSWLR 342, 350.
The first element of the contempt charge is not in contest, the respondent having admitted that he sent the emails from his wife’s email account.
In respect of the second element, a number a number of observations are apposite:
(a) A tendency to interfere with, or prejudice, the Commercial Court proceedings is to be determined at the time of respondent’s communications.
(b) Email communications that would, in their effect, subject a litigant to improper pressure to discontinue or compromise a proceeding might properly be regarded as having the appropriate tendency to interfere with the course of justice.[8]
[8]Harkianakis v Skalkos (1997) 42 NSWLR 22, 28, 64, 69 (‘Harkianakis’).
(c) In this species of contempt, the gravamen of the tendency is that the conduct may deter litigants from seeking curial vindication of their rights. It is in the public interest that most civil proceedings settle out of court. Accordingly, improper interference with settlement negotiations in a pending proceeding is no less of a contempt than interference with the course of a proceeding in the strictly forensic sense.[9] Put another way, the law’s concern is to protect from improper interference a litigant’s freedom to initiate, continue or discontinue legal proceedings as they choose. Whether that proceeding may succeed or is doomed to failure is irrelevant.[10]
[9]A-G v Times Newspapers, 317 (n 5).
[10]Harkianakis, 32 (n 8).
(d) In this context, whether there is impropriety in any pressure placed on a litigant depends on all relevant circumstances.[11] Improper pressure may include threats of unlawful action, abuse, misrepresentation, or other threats that may be conditional or unconditional and may concern lawful or unlawful conduct.[12]
[11]A-G v Times Newspapers, 326 (n 5); Harkianakis, 30 (n 8); Bhagat v Global Custodians Ltd [2002] NSWCA 160 (‘Bhagat’).
[12]Harkianakis, 32, 38, 41, 42, 66, 67 (n 8).
(e) In assessing whether, as a matter of practical reality, the communication has the requisite tendency, the court should take account of all relevant circumstances, including:
(i) the content of the impugned (and any surrounding) communication;
(ii) the nature of the proceedings liable to be affected, including whether they are in the civil or criminal jurisdiction;
(iii) the stage reached in the proceedings;
(iv) the persons to whom the communication was addressed; and
(v) the likely durability of the influence of the communication on its audience.[13]
(f) The period of time between the communication and the trial or other major milestone, such as a mediation, is also relevant.
[13]Hinch, 34 (n 6).
Adapting what the respondent submitted was the test to be applied by the court in determining whether there has been a contempt in this case, I consider the test to be:
Have the applicants proved, beyond reasonable doubt, that the conduct of the respondent in sending the August emails did, as a matter of practical reality, manifest a real tendency to interfere with the course of justice in the Commercial Court proceedings.
Analysis
While acknowledging that the considerations are finely balanced, I am unable to be satisfied beyond reasonable doubt that the August emails manifested the requisite tendency. That tendency cannot be found unless, objectively assessed, a court can be satisfied beyond reasonable doubt of the meaning conveyed by the communication.
A hypothetical litigant of ordinary fortitude is a litigant who may be thought to possess the attributes of the ordinary reasonable reader. In the present context, the ordinary reasonable reader is a convenient and applicable test. The question is “What is the meaning read from the communication by a person who:
(a) is of ordinary intelligence, experience and education;
(b) is neither perverse, nor morbid, nor suspicious of mind, nor avid for scandal;
(c) does not live in ivory tower, but can and does read between the lines in the light of that person’s general knowledge and experience of worldly affairs;
(d) reads the entire communication when determining whether it has the requisite tendency, but does not engage in over-elaborate analysis in a search for hidden meanings; and
(e) subscribes to general community standards?”[14]
[14]Amalgamated Television Services Pty Limited v Marsden (1998) 43 NSWLR 158, 164–167.
Where appropriate, the ordinary reasonable reader will know the particular extraneous facts that give rise to a true innuendo.
If the emails were considered in isolation, the applicants would fall well short of proving the commission of a contempt beyond reasonable doubt, but they must be considered in their relevant context.
I have not been persuaded in the context identified on the evidence before me that the communications conveyed any clear or definite meaning that constituted improper pressure in the sense alleged. The applicants’ submissions could not identify with precision the particular extraneous facts that required, beyond reasonable doubt, a meaning that supported a tendency to interfere with the course of justice.
The applicants’ evidence exaggerated the future consequences that are said to have caused them apprehension and formed the basis for the improper pressure. I was not persuaded beyond reasonable doubt that each deponent held a genuine belief they had been threatened with an allegation of dishonest criminal conduct, or a prospect that they (or any one of them) could go to jail on the basis of the conduct that had been put in issue in the Commercial Court proceedings.
The applicants contended, relying on observations of Spigelman CJ in Bhagat v Global Custodians Ltd,[15] that Ms Mort’s vulnerability, by reason of her health, was relevant in respect of each communication. In that case, the Chief Justice distinguished contempt by publication in which the issue of balancing the public interest in freedom of speech arises, with contempt by a private communication where the particular vulnerability of a party may be a material consideration when determining whether the pressure was improper.
[15]Bhagat (n 11).
Although this case concerns private communications, the relevant subjective assessment is not being advanced here by the applicants in the manner discussed by the Chief Justice. Ms Mort may have been more vulnerable to pressure because of her health, and the members of her family may also have been more vulnerable to pressure exerted upon Ms Mort for the same reason. However, a subjective analysis of their reactions to the communications cannot assist in identifying the necessary tendency contended for. It is not the recipient’s tendency to become upset or to feel threatened or intimidated that is important, unless it be the case that the sender is calculating to engage with such a tendency in the recipient. It is the tendency of the meaning of the communication to cause interference with the due administration of justice that must be proved.
The reactions of feeling confused, threatened, upset and intimidated cannot be said to show, to the requisite standard, that the reader was being subjected to improper pressure. That is simply not the only inference reasonably open in all of the circumstances and is not the meaning that the ordinary reasonable reader — even if armed with the particular extraneous facts that the applicants point to — would draw from the emails.
The recipients’ evidence of why they felt threatened by the email they received is both unconvincing, yet unchallenged.
Crewes described the threatening consequence as ‘going to jail for alleged dishonesty’. Why he reacted in that way to reading The Age article can only be surmised, for he did not explain it.
Ms Crewes did not explain why she felt threatened and intimidated. She did not express any personal apprehension of a police investigation, a prosecution or a possible sentence as a consequence of the matters alleged against her in the Commercial Court proceedings. She was however ‘extremely upset’ that the communication was copied to her daughters.
Ms Tregent-Crewes came to construe the communication as a threat that she could go to jail, although her initial reaction was that she was not being accused of criminal behaviour in the litigation and had not been involved in any such conduct. Ms Mort also thought she was being accused of something that she did not do. Each of the daughters considered their privacy to have been invaded by the communications to their private email addresses.
While such propositions were not put to the applicants, there is no rule of law requiring that evidence not challenged in cross-examination be accepted. A judge can reject evidence that has not been cross-examined on if, for example, it was inconsistent with other evidence that is accepted, or if it was inherently incredible.[16] The improbability of the operative threat alleged is a relevant consideration in the assessment whether the communication had the necessary tendency.
[16]Paric v John Holland Constructions Pty Ltd (1984) 2 NSWLR 505, 507; Ellis v Wallsend District Hospital (1989) 17 NSWLR 553, 586–88; Sullman v Sullman [2002] NSWSC 169, [304]–[306]; Caldwell v JA Neilson Investments Pty Ltd (2007) 69 NSWLR 120, 135 [96]; Masterton Homes Pty Ltd v Palm Assets Pty Ltd (2009) 261 ALR 382, 404–5 [105]; Spencer v Bamber [2012] NSWCA 274, [134].
Particularly in the absence of cross-examination, the language chosen by the applicants in their affidavits requires careful consideration and, in doing so, an alternative meaning inconsistent with the tendency contended for can be seen. The evidence equally supports a finding:
(a) first, that the August emails were offensive and threatening because they involved a breach of the recipients’ privacy through unanticipated and unauthorised use of their private email addresses; and
(b) second, that the communications caused a stress reaction for Ms Mort, then in the advanced stage of a difficult pregnancy, that was upsetting for all of the Crewes family members.
What causes me to entertain a doubt about the contemptuous nature of the tendency evident from the communications is that the primary reaction of the Crewes’ family to the second email, seen from their affidavits, was that the invasion of their privacy was inappropriate, particularly because of its stressful impact upon Ms Mort. Characterising the communications as exerting improper pressure on the applicants appeared to be a secondary consideration and, coming months later in a second affidavit, appeared to be tactical. The existence of reasonable alternate interpretations of the reaction of the recipients causes me to doubt that there was, in a genuine sense, an improper application of pressure.
The initial response of Ms Tregent-Crewes to the email she received carries the ring of probability. She did not think that she was accused of criminal conduct in the litigation, or that she had been involved in any such conduct. That reaction is not only understandable, but obvious. The cart was before the horse, in the sense that those consequences could only follow from a police investigation that was neither on foot nor in anyone’s contemplation at the time. On an objective test it must be doubted that the emails did convey the threat contended for by the applicants.
While the 28 June email might be part of an aggressive settlement strategy, what the applicants contended was that the August emails were both intimidating and part of that settlement strategy. It is not apparent how, beyond the subjective beliefs of the applicants, the subject emails were part of any settlement strategy. The applicants emphasised the stated intention in the 28 June email to ‘up the ante’, but I am not satisfied beyond reasonable doubt that I should draw the inference that the conduct that upped the ante was sending the August emails. NTM’s appointment of an administrator to TSH that shortly followed the 28 June email was conduct aptly described by that phrase, and I am satisfied that it was probably what Gaudry was referring to when he used that phrase.
Gaudry’s intentions in sending the August emails, as they may be inferred from the 28 June email, are ambiguous. However, I was not persuaded to the requisite standard that it must follow from that communication that the true meaning of the August emails revealed the tendency as the applicants contended. Once that submission falls away, no substantive connection is demonstrated between the August emails and Gaudry’s alleged settlement strategy of subjecting the Crewes family to improper pressure.
The absence of any content, and therefore any commentary, linking the consequences for Mr Oxley (the subject of The Age article) to the possible consequences for the applicants is telling. There was no connection between any allegation referred to in The Age article and any allegation made in the Commercial Court proceedings. There is a significant difference between allegations of serious criminal offending and allegations of breach of director’s duties or of fiduciary obligation, in a commercial context, arising out of a loan transaction. That distinction would have been apparent to the ordinary reasonable reader. The litigation was in the Commercial Court, not a criminal court.
For these reasons, having regard to the whole of the context, I have not been persuaded beyond reasonable doubt that the August emails had, as a matter of practical reality, a tendency to interfere with the due course of justice in relation to the Commercial Court proceedings, assessed objectively as at August 2020. I have a doubt whether the emails can properly be characterised as evidencing a tendency to interfere with the course of justice by subjecting Crewes to improper pressure to resolve the Commercial Court proceedings on terms favourable to Gaudry and contrary to his own interests.
As Gaudry correctly submitted, the criminal standard and onus of proof requires that if a publication or communication or statement ‘is reasonably capable of more than one meaning and one of those meanings does not involve contempt, a charge based upon that statement is … not made out’.[17]
[17]Warringah Shire Council v Manly Daily Pty Ltd (Court of Appeal (NSW), Hope, Glass and Samuels JJA 27 August 1985), cited by Mason P in Harkianakis, 40 (n 8).
In John Fairfax & Sons v McRae,[18] Dixon CJ, Fullagar J, Kitto J and Taylor J noted that the power to punish for contempt is founded on the elementary necessities of justice, and that there must be no hesitation to exercise it — even to the point of great severity — whenever any act is done which is really calculated to embarrass the normal administration of justice. On the other hand, because of its exceptional nature, the summary jurisdiction has always been regarded as one which is to be exercised with great caution, and only if it is made quite clear to the court that the matter published has, as a matter of practical reality, a tendency to interfere with the due course of justice in a particular case.[19]
[18]John Fairfax & Sons, 370 (n 7).
[19]See also Morgan v Victoria (2008) 22 VR 237, 269 [145].
In this particular case, the necessity clarity is lacking.
The communication sent to Crewes requires separate consideration. Curiously, the first email was directed to Mr Rogers, who had no direct involvement in the case, and blind copied to Crewes. It was therefore an incidental, rather than direct, communication to Crewes. Crewes gave no evidence about that aspect. For reasons already stated, I am not persuaded to infer to the requisite standard that the communication was reasonably read as a threat to Crewes not Rogers that jail was a probable consequence if Crewes did not give up or settle the litigation. Crewes made no such statement in his first affidavit. In his second affidavit, Crewes plainly places concern for his daughter’s health as his primary response to Gaudry’s conduct, which was to focus not on the email that he received, but on the email received by his wife and daughters. It might be another matter had Crewes honestly believed that improper pressure was applied by a threat of a police investigation into allegations of dishonest conduct, but that was not the case that was put.
To the extent that Crewes continued to suggest that he took the threat to be part of a strategy to intimidate him into settling the litigation, reference to the whole of the circumstances show Crewes and Gaudry had persisted in direct and robust communications in respect of the Commercial Court proceedings, notwithstanding that they had each retained solicitors. Having regard to the whole of the content and context of those communications, I entertain a doubt that the requisite tendency has been proved by the applicants in respect of the first email.
That said, I reject Gaudry’s contention that he has done no more than exercise his legal rights and protect his interests. I accept the applicants’ submissions insofar as they contended that Gaudry engaged in an aggressive campaign against them, but I do not accept that he ‘crossed the line’. Gaudry was right to wish to apologise for his conduct. He made an error of judgment with his arrogant and imprudent communications that appears to have spurred the applicants on with this application. In colloquial terms, he stopped just short of the line. Gaudry correctly accepted that he exercised poor judgment. He would be well advised in the future to exercise better judgment and to give careful consideration to the overarching obligations imposed on litigants by the Civil Procedure Act 2010 (Vic).
Gaudry submitted that he was a person of good character and drew attention to philanthropic undertakings, considerations that were said to be relevant in assessing whether his conduct had the requisite tendency to interfere with the due administration of justice. I did not find that submission helpful. I make no findings as to Gaudry’s character.
Conclusion
The application for the declaration that Gaudry be adjudged guilty of contempt will be dismissed.
I invite the parties to consider whether costs orders can be agreed and to provide either a consent minute or a short outline of submissions and any materials on which they rely to my chambers by 26 March 2021. Unaided by submissions and absent any knowledge of dealings out of court between the parties, I might conclude that there be no order as to costs. I will determine the question of costs on the papers, unless a contrary view, put in the submission, is persuasive.
Annexure A – The Age article
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