Tu v Chang (No. 2)

[2018] NSWDC 316

District Court

New South Wales

Medium Neutral Citation:	Tu v Chang (No. 2) [2018] NSWDC 316
Hearing dates:	25 October 2018
Date of orders:	25 October 2018
Decision date:	29 October 2018
Jurisdiction:	Civil
Before:	Gibson DCJ
Decision:	(1) Strike out the defence of justification to imputation 3(e). (2) Amended defence in 7 days deleting the defence of justification to imputation 3(e). (3) Defendants pay plaintiff’s costs of and incidental to this application on an indemnity basis. (4) The defendants’ category of discovery documents by 8 November 2018. (5) Matter stood over to the Defamation List on Thursday 15 November 2018.
Catchwords:	TORT – defamation – defendants justify one of five imputations but provide particulars acknowledged to be deficient despite three successive pleadings – whether defence of justification should be struck out – whether leave to amend should be granted – defence struck out without leave to replead being permitted
Legislation Cited:	Associations Incorporation Act 2009 (NSW), ss 30A, 33 and 40 Civil Procedure Act 2005 (NSW), ss 56 – 62 Defamation Act 2005 (NSW), ss 25, 26, 30, 31 and 33 Uniform Civil Procedure Rules 2005 (NSW), r 14.28
Cases Cited:	Brooks v Fairfax Media Publications Pty Ltd (No 2) [2015] NSWSC 1331 Church of the New Faith Inc v Bower (1977) 18 SASR 554 Crosby v Kelly [2013] FCA 1343 Devereaux v Clarke & Co [1891] 2 QB 582 Hickinbotham v Leach (1842) 152 ER 510 Hyer v Cabbie Pty Limited and Another [2007] NSWSC 795 Kingsfield Holdings Pty Ltd v Sullivan Commercial Pty Ltd [2013] WASC 347 Minus v Harbour Radio Pty Ltd [2017] NSWSC 191 Rush v Nationwide News Pty Ltd [2018] FCA 357 Sims v Wran [1984] 1 NSWLR 317 Vakras v Cripps [2015] VSCA 193 Wing v Australian Broadcasting Corp [2018] FCA 1340 Wing v Fairfax Media Publications Pty Ltd (2017) 255 FCR 61 Wootton v Sievier [1913] 3 KB 499 Zierenberg v Labouchere [1893] 2 QB 183
Texts Cited:	Brown on Defamation in Canada, United Kingdom, Australia, New Zealand and the United States (Thomson Reuters) Tobin & Sexton, Australian Defamation Law and Practice (LexisNexis)
Category:	Procedural and other rulings
Parties:	Plaintiff: Zhen Tu First Defendant: Qing Chang (known as Juliette Chang) Second Defendant: Chaohui Cui Fifth Defendant: Mingwu Jin
Representation:	Counsel: Plaintiff: Mr R Potter Defendants: Mr W Calokerinos   Solicitors: Plaintiff: Spencer & Co Legal Defendants: Ren Zhou Lawyers
File Number(s):	2017/308060
Publication restriction:	None

Judgment

1. The plaintiff by statement of claim filed on 6 October 2017 brings proceedings for defamation for publication of a letter dated 8 October 2016 sent by the defendants to members of the Australian Xinjiang Chinese Association on WeChat. The publication, which was in the Chinese language, was pleaded to convey the following imputations:

1. The plaintiff has stolen substantial sums of money from the Association (paragraphs 3-23 and 30);

2. The plaintiff is reasonably suspected of stealing substantial sums of money from the Association (paragraphs 3-23 and 30);

3. The plaintiff abused his position as Chairman of the Association to defraud the Association of funds rightfully belonging to its members (paragraphs 3-23 and 30);

4. The plaintiff sold assets of the Association and kept the proceeds for himself (paragraphs 3-23);

5. The plaintiff is unfit to be the Chairman of the Association in that he exercised control over the Association in the manner of a totalitarian dictator (paragraph 3-32).

2. The plaintiff seeks an order striking out the defence of justification to imputation 3(e) on the basis that it discloses no reasonable defence (r 14.28(1)(a) and (b) Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”)). The plaintiff also seeks an order that, if successful on the strike out, the defendants not be permitted to amend the defence further.

The particulars the subject of the application

3. The particulars the subject of the challenge are brief to the point of obscurity. They are as follows:

“The facts, matters and circumstances on which the defendant relies to establish that the defamatory imputation in para 3(e) of the SOC was substantially true are:

(i) The number and the manner of calling and holding of meetings;

(ii) lack of financial accountability with the Association;

(iii) the plaintiff’s Publications in reply to the letter that is next to the Amended Defence at A, B, C and D See Specifically, Annexure A in the Amended Defence, paragraphs 30 and thirty-three on page 4 and paragraph 39 on page 5.

See Specifically, Annexure C dated 12 October 2016, in the Amended Defence, paragraph 7 on page 23 – that document proves the “autocratic manner” of the plaintiff with the Association without any legal basis””

4. The matter complained of contains slightly more information, in that the following (translated) passage of the matter complained of (at paragraphs 24-30) states the following:

“24. II. Breach of the Constitution of Association, lack of governance and totalitarian dictatorship

25. Since the establishment of the Association, a good governance system had not been established for more than 2 years. There was no Secretary General, Committee Members, Board of Supervisors or treasurer, and all posts were held by Zhen TU who did not handle matters according to the Association’s constitution. This had violated the Associations Incorporated Act.

26. III. The personnel and meeting decisions of the Association were not open to public.

27. Major issues were decided without the Committee or Board of Supervisors and the Committee and Board of Supervisors were just empty shells. The issues discussed at each meeting were different and so were the presence of members. Zhen TU could ask anyone he needed to come for the meeting, and there were not many meetings at all. Most of the issues had been decided by himself, and he just asked people for meeting when something needed to be done by them. There was no fixed management team. Attendance of Meetings of the Association varied and was not open to public. Hence personnel arrangement and member dismissal could be determined freely without the participation of council.

28. IV. Lack of democratic awareness, transparency and, supervisory mechanism.

29. All advice or suggestions are brought forward for the growth and development of the Association, hence, it is improper to push aside, crack down, or defame and marginalize anyone who is capable of giving suggestions. Zhen TU dismissed Liping ZHANG’s membership and removed her from the group of the Song and Dance Troupe after she brought forward some suggestions to Zhen TU. Then other members added her back to the group. Zhen TU kicked her out again and warned that he would kick her out every time she was added to the group. Zhen TU often spoke ill of members in front of other members, and he was without hesitation to insult others even it may hurts the unity. He didn’t allow dissent suggestions from others, he either treated them badly, or asked others to isolate them, to make them marginalized and forced them to leave voluntarily. He lacked democratic awareness. Decisions were only discussed between Chairman Zhen TU and Vice-chairman Zongjun HUANG, and other Committee Members did not usually have the chance to join in, so there was lack of transparency in it.

30. Currently, all financial affairs are accounted and checked by Chairman Zhen TU and there is no review for income and spending. The details of financial statement have never been disclosed to the public. It has been more than 2 years since the Association was established, but the supervisory mechanism has never been organized. All these facts left people to have no choice but to doubt the honesty and credibility of the Chairman, and to believe that Zhen TU is not qualified for the chairman any more.”

5. It is readily apparent that the particulars provided not only lack any specificity in terms of these asserted facts, but provide no information as to how the conduct in question would prove the truth of this imputation. The matter complained of does not itself provide any assistance in that it makes allegations of a general nature. Mr Calokerinos conceded as much in his submissions in reply.

The relevant principles

6. Mr Potter submitted that the particulars in support of a truth case must satisfy two requirements:

1. Firstly, they must be capable of proving the truth of the imputation sought to be justified.

2. Secondly, they must be sufficiently precise to enable the plaintiff to know the case he is to meet: Hickinbotham v Leach (1842) 152 ER 510 at 510; Zierenberg v Labouchere [1893] 2 QB 183 at 186-187; Wootton v Sievier [1913] 3 KB 499 at 503; Crosby v Kelly [2013] FCA 1343 at [33]; Brooks v Fairfax Media Publications Pty Ltd (No 2) [2015] NSWSC 1331 at [9]-[12].

7. The phrase “same precision as in an indictment” is often used. The correct meaning of that phrase, taken from Sims v Wran [1984] 1 NSWLR 317, is explained by McCallum J in Brooks v Fairfax Media Publications Pty Ltd (No 2) at [12] as follows:

“[12] That expression (“with the same precision as in an indictment”) is one which is capable of being misunderstood. It is a requirement of specificity rather than one going to the amount of information to be provided. As I observed during argument, the amount of detail in an indictment is often spare but the specificity provided should be such as to put an accused person on notice of the Crown case as to each element of the offence with which he or she is charged.”

8. A number of recent applications to strike out defences of justification have resulted in the court carefully analysing the particulars and striking them out for reasons ranging from relevance to admissibility: Wing v Fairfax Media Publications Pty Ltd (2017) 255 FCR 61; Wing v Australian Broadcasting Corp [2018] FCA 1340; Rush v Nationwide News Pty Ltd [2018] FCA 357. I note, however, that in Rush v Nationwide News Pty Ltd, Wigney J took a rather more conservative approach:

“[50] The fact that the evidence ultimately adduced in support of a justification defence may be greater than the bare content of the “topics” outlined in the particulars plainly does not mean that particulars of a justification defence can never be struck out on the ground that they are not capable of proving the truth of the defamatory meanings sought to be justified: see the observations of McCallum J in Eardley v Nine Network Australia Pty Ltd [2017] NSWSC 1374 at [16]; and Gair v Greenwood [2017] NSWSC 1652 at [11]. In approaching such an application, the Court must determine whether the particulars that have been provided, taken at their highest, are capable of proving the truth of the defamatory imputations that are sought to be justified. In making that determination, the Court must not only bear in mind that the particulars are a bare outline of the facts that the claimant will seek to prove, but also exhibit the “curial caution” that must necessarily be exhibited in determining, at an interlocutory stage, factual issues that may be better finally determined on the basis of all of the evidence led at the trial.”

9. The particulars in question must be provided prior to discovery as “a defendant is not entitled to discovery for the purpose of finding out whether he has a defence or not” (Zierenberg v Labouchere at 188 per Lord Esher MR). The plaintiff must be prepared to act and justify the accusation without the assistance of the court for truth. The defendant cannot answer to say that further particulars (or indeed any particulars) will be provided after discovery: Kingsfield Holdings Pty Ltd v Sullivan Commercial Pty Ltd [2013] WASC 347 at [40]; see the discussion of the relevant authorities in Tobin & Sexton, Australian Defamation Law and Practice (LexisNexis) at [25,175] and Brown on Defamation in Canada, United Kingdom, Australia, New Zealand and the United States (Thomson Reuters) (“Brown”) at [20.4(2)] and [20-31].

10. Nor may a defendant say (as is also the case here) that these particulars are a matter for evidence at the trial: Brown, supra, at 20-33, citing Wootton v Sievier. While it used to be the case that the court should still be careful to ensure “the defendant is not compelled to disclose his evidence to any greater extent than that which is necessary to enable the plaintiff to know the precise charge he has to meet” (Church of the New Faith Inc v Bower (1977) 18 SASR 554 at 559 per Bray CJ), this has not been the approach taken by recent Federal Court cases.

11. The question of what particulars are appropriate where someone is called a “totalitarian dictator” may not be an easy task. Dictators display a wide range of totalitarian behaviour: Minus v Harbour Radio Pty Ltd [2017] NSWSC 191 (comparison to Vladimir Putin); Hyer v Cabbie Pty Limited and Another [2007] NSWSC 795 and Vakras v Cripps [2015] VSCA 193 (comparison to Adolf Hitler). However, where a book reviewer described the plaintiff as “a barefaced liar”, the defendant was ordered to provide particulars of the lies in question (Devereaux v Clarke & Co [1891] 2 QB 582), and where a newspaper deplored “many evils” in the conduct of promoters of a horse race, the court ordered particulars of those evils. The same should be the case here.

12. Another factor of relevance is the principle of proportionality as set out in ss 56 – 62 Civil Procedure Act 2005 (NSW): Brooks v Fairfax Media Publications Pty Ltd (No 2) at [20]-[28]. Those factors are particularly relevant in a case such as the present, where the pleading of justification is restricted to one imputation, and where the terms of that imputation are less serious than the imputations for which the defence is not put forward.

13. The particulars in the present case do not even begin to inform the plaintiff of the case he has to meet. They are accordingly struck out. The question which remains is whether leave to replead should be granted, or whether the defence should be struck out.

Refusal of leave to amend the defence

14. The plaintiff seeks an order that the defendants should not be permitted to amend the defence further in relation to the truth defence by reason of the multiple attempts to amend to date, and the circumstances in which the pleas of justification were withdrawn to the other four imputations.

15. That history may briefly be stated as follows. A defence was filed on 3 May 2018 which pleaded defences of justification (s 25 Defamation Act 2005 (NSW)) to all imputations as well as a defence of contextual truth (s 26), statutory qualified privilege (s 30), honest opinion (s 31) and triviality (s 33). The particulars of justification were challenged and this charge was to be the subject of argument when, instead of responding to objections, the defendants filed an Amended Defence without leave. While leave was granted on 21 June 2018 (subject to costs of relisting as well as of amendments), the Amended Defence was no better and a fresh application to strike out was brought. The defence in its current form was filed on 10 July 2018. Unlike the previous two versions of the defence of justification, truth was only pleaded to imputation 3(e) and the contextual truth defence was abandoned. The other defences remained largely the same.

16. This is not a history which encourages confidence in the likelihood of a more precise set of particulars, particularly since Mr Calokerinos conceded he had not yet obtained instructions from his clients as to the precise facts, matters and circumstances relied upon in relation to the justification of this imputation.

17. There are also case management and proportionality issues relevant to the maintaining of this defence. As noted above, out of the five imputations, imputation 3(e) is the least serious. Even if the defence of justification succeeds at the trial, the impact on damages could well be outweighed by the additional time taken to conduct this defence. It adds unnecessary complexity to the trial, not least because, if the defence fails, it may be grounds for a claim for aggravated damages.

18. The striking out of a defence without leave to replead is a step only to be taken in clear and obvious cases, of which this is one, given the history of past failures and the structure of the present defence. The defendants are able to rely on other defences of more utility to this imputation than the hopelessly particularised defence of justification currently forming part of the pleadings.

19. Accordingly, for these reasons, I have refused the defendants leave to provide further particulars of justification to imputation 3(e).

Costs

20. Mr Potter sought indemnity costs on the basis this was not only a hopelessly drafted set of particulars, but acknowledged to be such by counsel for the defendants in the course of argument. Nevertheless his client had been served with an affidavit “approximately two inches thick”, as well as lengthy submissions and repeated requests for copies of discovery documents to enable the defendants to prove their case.

21. I have read the correspondence forwarded to the solicitors for the defendants. I note there has been a dispute concerning the plaintiff’s refusal to return Association documents in his possession since he was removed from his position on 11 October 2016. I also note that there had been requests to inspect the documents pursuant to ss 30A, 33 and 40 of the Associations Incorporation Act 2009 (NSW). That does not mean, however, that the defendants should use the discovery process in defamation proceedings in order to obtain access to those documents.

22. The hopelessness of the particulars of justification and the repeated failures to correct these deficiencies fall outside the general parameters of efficient case management. Having regard to the overriding provisions of s 56 Civil Procedure Act 2005 (NSW), I consider that this is an appropriate occasion for the awarding of indemnity costs.

Orders

1. Strike out the defence of justification to imputation 3(e).

2. Amended defence in 7 days deleting the defence of justification to imputation 3(e).

3. Defendants pay plaintiff’s costs of and incidental to this application on an indemnity basis.

4. The defendants’ category of discovery documents by 8 November 2018.

5. Matter stood over to the Defamation List on Thursday 15 November 2018.

**********

Decision last updated: 29 October 2018