Ultrasonic Slimming Pty Ltd v Fairfax Media Publications Pty Ltd
[2013] NSWSC 547
•15 May 2013
Supreme Court
New South Wales
Medium Neutral Citation: Ultrasonic Slimming Pty Ltd & Ors v Fairfax Media Publications Pty Ltd & Ors [2013] NSWSC 547 Hearing dates: 06.05.13 Decision date: 15 May 2013 Before: Nicholas J Decision: Par 22
Catchwords: PRACTICE AND PROCEDURE - substituted service - plaintiffs unable to locate third defendant - third defendant identified by pseudonym as informant for article published by first and second defendants - promise not to reveal third defendant's identity - whether journalists' privilege extends to informant - whether order for substituted service would result in disclosure of third defendant's identity - whether order should be made Legislation Cited: Court Suppression and Non-Publication Orders Act 2010
Evidence Act 1995
Uniform Civil Procedure Rules 2005
Evidence Amendment (Journalist Privilege) Bill 2011Category: Interlocutory applications Parties: Ultrasonic Slimming Pty Ltd - first plaintiff
Juliet Young - second plaintiff
Leon van den Heuvel - third plaintiff
Fairfax Media Publications Pty Ltd - first defendant
Melissa Davey - second defendant
Suzie Driver - third defendantRepresentation: Counsel:
R Rasmussen - plaintiffs
A T S Dawson - first, second defendants
Solicitors:
Cambridge Law - plaintiffs
Banki Haddock Fiora - first, second defendant
File Number(s): 13/71789
Judgment
His Honour: By notice of motion filed 6 May 2013, the plaintiffs seek an order under UCPR 10.14 that service of the amended statement of claim on the third defendant be effected by service upon the solicitor for the first and second defendants. The application was opposed by the first and second defendants. Their standing to do so was not contested.
The first plaintiff carries on business under the name of Ultrasonic Slimming Clinics of which the second plaintiff is the owner and sole director.
By amended statement of claim filed 23 April 2013, the plaintiffs have sued the defendants for the publication in the edition of the newspaper "The Sydney Morning Herald" of 6 March 2013 of an article under the heading "Investigation of cheap Botox 'sausage factory'". They allege the article conveys a number of defamatory imputations concerning them.
The first defendant is the publisher of the newspaper. The second defendant is the journalist employed by the first defendant, and the author of the matter complained of. The third defendant's name is a pseudonym. It is the name by which she was identified in the matter complained of as the provider of the information which is attributed to her in the following passages:
"A patient, Susie Driver, complained to the college after she developed thrush and a two-week headache after treatment in December. She had previously bought a voucher from the discount website Groupon to receive 'anti-wrinkle injections' for $139.
...
Ms Driver said that when she redeemed the voucher she was told she would receive 30 units of Botox over two facial areas, working out at $4.63 a unit. According to the college, in Australia genuine Botox costs a doctor about $5.67 a unit.
...
Ms Driver said she was told Botox would be used in the injections.
The Gladesville clinic eventually refunded the price of Ms Driver's voucher."
The statement of claim which was filed on 8 March 2013 was served on the first and second defendants. Their former solicitor filed an appearance on 21 March 2013. Their present solicitor filed a notice of change of solicitor on 4 April 2013.
In support of the application the plaintiffs relied upon the following evidence contained in affidavits which were read without objection.
Mr Raed Rahal, the plaintiffs' solicitor, said (aff 09.04.13) that searches of the records of the Ultrasonic Slimming Clinics at Gladesville and Paddington disclosed no reference to any person with the name Suzie Driver or similar, and that a google search of her name on the internet was unsuccessful.
The second defendant said (aff 26.04.13) that the person referred to as "Suzie Driver", the third defendant, was a source for the article. She said she had a number of conversations in which she promised the person that her identity would be kept confidential and not revealed. The second defendant said that the name "Suzie Driver" is not the person's real name, and was used to protect her identity as a source. She said that in a conversation on 9 April 2013 the person agreed for her contact details to be passed on to the second defendant's solicitor.
Miss Leanne Norman is the solicitor for the first and second defendants. She said (aff 24.04.13) that on 9 April 2013 she had a conversation with the person referred to as Suzie Driver in which she advised her of these proceedings, and that she had been named as the third defendant. The person refused to authorise Miss Norman to accept service on her behalf, or to provide her name and contact details to the plaintiffs' solicitors.
The amended statement of claim is in the prescribed form, and includes the notice under r 6.13 that unless a defence is filed the proceedings may result in a judgment or order against the defendant.
Relevantly, UCPR r 10.14 provides:
10.14 Substituted and informal service generally
(1) If a document that is required or permitted to be served on a person in connection with any proceedings:
(a) cannot practicably be served on the person, or
(b) cannot practicably be served on the person in the manner provided by law,
the court may, by order, direct that, instead of service, such steps be taken as are specified in the order for the purpose of bringing the document to the notice of the person concerned.
...
(4) Service in accordance with this rule is taken to constitute personal service."
For the plaintiffs it was submitted that personal service on the third defendant was impracticable in the circumstances, and that substituted service on the solicitor for the first and second defendants would efficaciously bring to the third defendant proper notice of the amended statement of claim.
The submissions for the first and second defendants against the making of an order were based on the scope of the journalist's privilege relating to the identity of an informant under the Evidence Act 1995 (the Act). The relevant provisions are:
"126J Definitions
In this Division:
informant means a person who gives information to a journalist in the normal course of the journalist's work in the expectation that the information may be published in a news medium.
journalist means a person engaged in the profession or occupation of journalism in connection with the publication of information in a news medium.
126K Journalist privilege relating to identity of informant
(1) If a journalist has promised an informant not to disclose the informant's identity, neither the journalist nor his or her employer is compellable to give evidence that would disclose the identity of the informant or enable that identity to be ascertained.
(2) The court may, on the application of a party, order that subsection (1) is not to apply if it is satisfied that, having regard to the issues to be determined in the proceeding, the public interest in the disclosure of the identity of the informant outweighs:
(a) any likely adverse effect of the disclosure on the informant or any other person, and
(b) the public interest in the communication of facts and opinion to the public by the news media and, accordingly also, in the ability of the news media to access sources of facts.
(3) An order under subsection (2) may be made subject to such terms and conditions (if any) as the court thinks fit.
...
131A Application of Part to preliminary proceedings of courts
(1) If:
(a) a person is required by a disclosure requirement to give information, or to produce a document, which would result in the disclosure of a communication, a document or its contents or other information of a kind referred to in Division 1, 1A, 1C or 3, and
(b) the person objects to giving that information or providing that document,
the court must determine the objection by applying the provisions of this Part (other than sections 123 and 128) with any necessary modifications as if the objection to giving information or producing the document were an objection to the giving or adducing of evidence.
(2) In this section, disclosure requirement means a process or order of a court that requires the disclosure of information or a document and includes the following:
(a) a summons or subpoena to produce documents or give evidence,
(b) pre-trial discovery,
(c) non-party discovery,
(d) interrogatories,
(e) a notice to produce,
(f) a request to produce a document under Division 1 of Part 4.6."
The Explanatory Note to the Evidence Amendment (Journalist Privilege) Bill 2011 includes:
"Schedule 1 [3] inserts proposed Division 1C into Part 3.10 of the Evidence Act 1995 relating to journalist privilege. A journalist (and his or her employer) will not be compelled to give evidence in any court proceeding that would disclose an informant's identity if the journalist has promised not to disclose the informant's identity. However, the protection will not apply if the court is satisfied that the public interest in having the informant's identity disclosed outweighs both any likely adverse effect of the disclosure on the informant (or on any other person) and the public interest in the communication of facts and opinion to the public by the news media (including the ability of the news media to access sources of facts). Journalist privilege is limited to persons who are engaged in the profession or occupation of journalism."
The argument for the first and second defendants may be summarised as follows. The name of the third defendant is a pseudonym for an informant who provided to the second defendant information for the article on the promise that her identity would not be disclosed. The operation of s 126K and s 131A of the Act establishes for the first and second defendants a privilege whereby they, or either of them, will not be compelled to disclose the identity of the third defendant in any court proceedings, including preliminary proceedings under which disclosure would otherwise be required. The plaintiffs have not sought orders for pre-trial discovery under UCPR Pt 5 that the first and/or second defendant disclose the third defendant's identity. By reason of the privilege, any such proceedings would be unlikely to succeed. The application for substituted service is an impermissible attempt to obtain by a different route the identity of the informant. Counsel developed the submissions as follows:
(T p 8, l 10 - l 17):
"That is the key point, the jurisdictional fact that gets you into the privilege in 126C [sic]. Without that there wouldn't be opposition to the plaintiffs' application. The opposition is based on the fact they can't get her identity any other way. They ought not be able to use a different process of the Court to achieve the same result by a side wind and go behind the journalists privilege which the Evidence Act set up, which is as powerful as legal professional privilege. One should not be able to get around the journalists privilege by a side wind. That is what this application is."
and, T p 9, l 29 - l 33:
"The risk is that if your Honour gives the plaintiffs the first step along the way to identifying her, your Honour will have, in effect, with respect, permitted an abuse of process because the plaintiffs are using an interlocutory process of the Court to go behind the privilege which otherwise protects the identity of the third defendant."
and, T p 12, l 26 - l 32:
"The moment that the third defendant is served by the order for substituted service she will be required under the rules to file a Notice of Appearance if she wishes to avoid a default judgment. That Notice of appearance will immediately unavoidably inevitably disclose her identity and that is a disclosure requirement which will result in the disclosure of what is otherwise protected privileged information, namely, her identity, which is established by s 126K and extended to this area of debate by s 131A."
It was further submitted that the privilege under s 126K is not a protection restricted to the journalist but operates to protect the source.
Determination
Some preliminary observations are appropriate. The name of the third defendant is a pseudonym. No complaint is made about that. The third defendant is a real person. The underlying purpose of the rules for service is to bring the document to the notice of the person concerned. Where it is impractical to effect personal service an order for substituted service under r 10.14 provides an alternative means for notification to be given to the person concerned, in this case the third defendant. No rights of the first or second defendants are involved in making an order for substituted service of the amended statement of claim on the third defendant, and no issue as between the plaintiffs and the first and second defendants fall for consideration. The present application concerns only a matter of procedure whereby the amended statement of claim is efficaciously brought to the notice of the third defendant.
Under s 126K(1) of the Act a journalist has a privilege relating to the identity of an informant so that neither the journalist nor his or her employer is compellable to give evidence that would disclose the identity of the informant or enable that identity to be ascertained. The court may order that the privilege not apply with regard to the matters specified in subs (2). By s 131A(1) the privilege is extended to a journalist who is the subject of a requirement to disclose similar information under preliminary proceedings of courts including those made by subpoenae, pre-trial discovery, and other pre-trial court processes. As to the scope of the privilege, it is clear from the terms of the Act that it is confined to the journalist and his or her employer. Nothing in the ordinary language of s 126J, s 126K and s 131A supports the proposition that it extends to the informant or source. In my opinion, analysis of these provisions leads to the inevitable conclusion that they have no application to the plaintiffs' claim in this case for an order for substituted service. It follows that the submissions of the first and second defendants in reliance upon them are rejected.
The tender and anxious concern of the first and second defendants to ensure that the identity of the third defendant not be disclosed can be no impediment to her joinder as a party under a pseudonym. The fact that neither the first nor second defendant is compellable to disclose her true identity does not preclude the plaintiff from commencing and maintaining these proceedings against her. In my opinion these considerations do not affect the plaintiffs' entitlement to orders for service under r 10.14 to facilitate the progress of these proceedings. It is trite to observe that nothing involved in this application seeks disclosure of any information from anybody.
The prospect that, following service, the third defendant may be constrained to take a step in the proceedings which will result in the disclosure of her true name is a factor which, in my opinion, is irrelevant to the exercise of discretion under r 10.14. At the present time which of the various steps which she chooses to take once served is a matter of speculation. For example, she may or may not file an appearance; she may or may not file a defence; she may or may not apply as a party to the court for a suppression order or a non-publication order prohibiting disclosure of information tending to reveal her identity (Court Suppression and Non-Publication Orders Act 2010, s 7, s 8, s 9).
Conclusion
The evidence establishes that the plaintiffs have been unable to locate the third defendant whose whereabouts are unknown to them. The first and second defendants and their solicitors are in contact with her, and know where to find her. In the circumstances, the interests of justice require an order for substituted service be made. Such an order involves no disclosure of the third defendant's true identity or, in any imaginable way, amounts to an abuse of process. Its effect will be, in accordance with the purpose of the rule, to bring the pleading to her notice. Once the pleading is served it will be for the third defendant to decide what steps to take to protect her interests.
Orders
It is ordered that:
(1) Pursuant to UCPR Pt 10, r 10.14 service of the amended statement of claim on the third defendant named "Suzie Driver" be effected by service upon the solicitor for the first and/or second defendants within seven days.
(2) The first and second defendants pay the plaintiffs' costs.
(3) These proceedings be stood over for directions to the registrar's list at 9am 24 May 2013.
(4) Liberty to apply on 1 day's notice.
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Decision last updated: 15 May 2013
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