Whelan v John Fairfax Publications Pty Ltd - [2002] NSWSC 1028

Reported Decision:
(2002) 56 NSWLR 89

New South Wales

Supreme Court

CITATION: WHELAN & ANOR v JOHN FAIRFAX PUBLICATIONS PTY LTD & ORS [2002] NSWSC 1028 revised - 9/04/2003

FILE NUMBER(S): SC 20499 OF 1998; 20502 OF 1998; 20503 OF 1998; 20556 OF 1999

HEARING DATE(S): 10 October 2001
22 October 2001
25 October 2001

JUDGMENT DATE: 1 November 2002

PARTIES :

PAUL FRANCIS PATRICK WHELAN
(First Applicant)
COLLEEN WHELAN
(Second Applicant)
v
JOHN FAIRFAX PUBLICATIONS Pty Ltd
(First Respondent)
DARREN GOODSIR
(Second Respondent)
HEATH GILMORE
(Third Respondent)

JUDGMENT OF: Levine J at 1

COUNSEL :
R McColl SC / P Gray
(Paintiffs)
S D Rares SC/ A Leopold
(Defendants)

SOLICITORS:
Jones & Staff
(Plaintiffs)
Freehills
(Defendants)

CATCHWORDS: Justification - contextual imputations - Polly Peck - partial justification - common sting

LEGISLATION CITED: Defamation Act 1974

CASES CITED: Agar v Hyde (2000) 201 CLR 552
Allen v John Fairfax & Sons Ltd, unreported, NSWSC, Hunt J, 2 December 1988
Amalgamated Television Services Pty Ltd v Marsden [1998] 43 NSWLR 158
Bank of NZ v Spedley Securities Ltd (In Liq) (1992) 27 NSWLR 91
Carrey v ACP Publishing Pty Ltd [1999] 1 VR 875
Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519
Clarke v Taylor & Anor ((1836) 2 Bing (N C) 654
Curran v Herald and Weekly Times, unreported, Supreme Court of Victoria, 28 September 1993
David Syme & Co Ltd v Hore-Lacy [2000] 1 VR 667
David Syme & Co Ltd & Anor v Hore-Lacy [2000] VSCA 24
Dunsec Pty Ltd v Nationwide News Ltd [2000] NSWCA 155
Edwards v Bell (1825) 1 Bing 403 at 409
Farquhar v Bottom [1980] 2 NSWLR 380
Goody v Odhams Press Ltd [1967] 1 QB 337
Grundmann v Georgeson (1996) Aust Torts Rep 63,500
Gumina v Williams (No 2) [1990] 3 WAR 351
Harb v Illawarra Newspapers Holdings Pty Ltd, unreported, Levine J, 10 November 1995
Hart v Wrenn (1995) 5 NTLR 17
Hepburn v TCN Channel Nine Pty Ltd [1984] 1 NSWLR 386
Hore-Lacy v David Syme & Co Ltd [1998] VSC 96
Jackson v John Fairfax & Sons Ltd [1981] 1 NSWLR 36
John Fairfax Publications Pty Ltd v Blake; David Syme & Co Ltd v Blake (2001) 53 NSWLR 541
John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503
Jones v Skelton (1963) 63 SRNSW 644
Keating v Newcastle Newspapers Pty Ltd (No 2) [2001] NSWSC 106
Kelly v Special Broadcasting Service [1999] VR 69
Kennett v Farmer [1988] VR 991
Lewis v Daily Telegraph [1964] AC 234
Lucas-Box v News Group Newspapers Ltd [1986] 1 WLR 147
McBride v Australian Broadcasting Corporation [2000] NSWSC 747
Marsden v Amalgamated Television Services Pty Ltd [2001] NSWSC 510
Pamplin v Express Newspapers Ltd [1988] 1 WLR 116
Plato Films Ltd v Spiedel [1961] AC 1090
Polly Peck (Holdings) PLC and Ors v Trelford & Ors [1986] QB 1000
Prager v Times Newspapers Ltd [1998] 1 WLR 77
Random House Australia Pty Ltd v Abbott (1999) 94 FCR 296
Rantzen v Mirror Group Newspapers Ltd [1994] QB 670
Rigby v John Fairfax Group Pty Ltd, unreported, NSWCA, 1 February 1996
Robinson v Laws [2001] QCA 122
Sutherland v Stopes [1925] AC 47
Sydney Refractive Surgery & 3 Ors v Beaumont & 2 Ors [2002] NSWSC 638
TCN Channel Nine Pty Ltd v Antoniadis (1998) 44 NSWLR 682
TWT Ltd v Moore (1991) A Def Rep 51,030
Wallace v Wallace [2001] WASC 134
Wickstead v Browne (1992) 30 NSWLR 1
Woodger v Federal Capital Press of Australia Pty Ltd (1992) 107 ACTR 1

DECISION: See paragraph 108

- 38 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
DEFAMATION LIST

JUSTICE DAVID LEVINE

Friday 1 November 2002

20499 OF 1998
20502 OF 1998
20503 OF 1998
20556 OF 1999

PAUL FRANCIS PATRICK WHELAN
(First Applicant)

COLLEEN WHELAN
(Second Applicant)

v

JOHN FAIRFAX PUBLICATIONS Pty Ltd
(First Respondent)

Darren Goodsir
(Second Respondent)

Heath Gilmore
(Third Respondent)

Polly Peck

1 On 13 and 14 February 2001 the 7A jury trial with respect to these defamation actions took place. The plaintiffs have sued in respect of two publications, the first an article in The Sun Herald of 13 December 1998 and the second, an article in the same newspaper a week later, namely 20 December 1998. The text of those two matters complained of are appended hereto as “A” and “B”.

2 The present application by the plaintiffs, founded in a Notice of Motion filed on 25 June 2001, supported by an affidavit of Conrad Gerard Staff sworn that day seeks orders in relation to defences upon which the defendants propose to rely. The motion is directed to an Amended Defence filed on 8 May 2001 in the consolidated actions. That filed Amended Defence, consequent upon, as I understand it, an exchange of correspondence between the parties, was followed by a proposed Further Amended Defence upon which the application and submissions was focussed.

3 The outcome of the structure of the application is that attention need now be paid only to so much of the Further Amended Defence as is relevant to the imputations found by the jury to be defamatory of the first plaintiff, Mr Paul Whelan.

4 The first matter complained of the jury found to carry two defamatory imputations:

5(a) The First Plaintiff acted against the public interest by influencing other Members of Parliament to use his wife’s travel agency in breach of normal parliamentary guidelines.

5(b) The First Plaintiff abused his position as Minister for Police by influencing other Members of Parliament to use his wife’s travel agency in breach of normal parliamentary guidelines.

5 The defendants propose, pursuant to s15 Defamation Act 1974, to justify these found imputations.

6 The defendants propose to rely on the following contextual imputations:

[ (A) and (B) are the plaintiff’s imputations]

(C) in seeking to influence Members of Parliament to use the travel agency in which his wife was a director and shareholder in breach of Parliamentary guidelines and in an attempt to secure financial gain for his family, the first plaintiff’s conduct afforded reasonable grounds for a finding by the Independent Commission Against Corruption (the ICAC) of corrupt conduct on the part of the first plaintiff; and/or

(D) the first plaintiff so conducted himself as to afford reasonable grounds for suspicion by the ICAC that he had engaged in corrupt conduct by influencing Members of Parliament to use a travel agency in which his wife was a director and shareholder so as to secure private gain for his family contrary to the public interest; and/or

(E) the first plaintiff acted seriously contrary to the public interest by failing to take steps to avoid a conflict arising from, on the one hand, his personal interests arising from his part ownership of licensed premises in Sydney and, on the other hand, the duties imposed upon him as Minister for Police; and/or

(F) the first plaintiff abused his position as Minister for Police by failing to take steps to avoid a conflict arising from, on the one hand, his personal interests arising from his part ownership of licensed premises in Sydney and, on the other hand, the duties imposed upon him as Minister for Police; and/or

(G) the first plaintiff acted seriously contrary to the public interest in that, by maintaining notorious part ownership of licensed premises in Sydney, while at the same time holding the position of Minister for Police, he placed New South Wales Police officers in a position in which they felt obliged to depart from their normal duties and instead act in a way they believed would serve the personal interests of their Minister for Police; and/or

(H) the first plaintiff abused his position as Minister for Police in that, by maintaining notorious part ownership of licensed premises in Sydney, while at the same time holding the position of Minister for Police, he placed New South Wales Police officers in a position in which they felt obliged to depart from their normal duties and instead act in a way which they believed would serve the personal interests of their Minister for Police.

7 The plaintiff sues in respect of publication in New South Wales and other States and Territories of Australia.

8 The defendants justify the plaintiff’s found imputations in accordance with the relevant statute/code/common law of other States and Territories (paragraph 5(a)(1) and (2) of the Further Amended Defence).

9 The defendants further under the heading “Justification/Polly Peck” plead the contextual imputations set out above with respect to publication in Victoria, Western Australia, South Australia and the Northern Territory (paragraph 5(b)(1) and (2)).

10 By paragraph 5(3)(A), (B), (C) and (D) the defendants plead a defence by way of “partial” justification.

11 Finally, the defendants contend (paragraph 5(4)) that the matter complained of contains the following imputation of the first plaintiff:

The first plaintiff failed to fulfil his obligations as a Member of Parliament and as a Minister of the Crown in that he placed his personal interests, and those of his family, above those obligations.

“common sting”.

Polly Peck

12 The Further Amended Defence is some 76 pages in length (defending the action of each plaintiff) and contains within it a substantial body of particulars in support of each defence, which body of particulars is the subject of separate complaint by the plaintiff.

13 It was agreed between the parties that the plaintiff’s strike out application would be applied to the Further Amended Defence as proposed.

14 The plaintiff seeks to strike out parts of the proposed Further Amended Defence in relation to the contextual truth pleadings and cognate defences (interstate) on two bases: first, that the respective matters complained of are incapable of giving rise to the meanings relied upon by way of contextual imputations; secondly, if the matters are capable of carrying such meanings, the test provided for in s16(2)(c) of the Defamation Act cannot rationally be satisfied.

15 It is thus necessary to consider first the question of capacity.

16 It can be seen from the defendants’ contextual imputations that they fall into categories. The first two imputations pleaded as contextual imputations are, of course, the imputations pleaded by the plaintiff and found by the jury to be carried. They are “pleaded back” to protect the defendants in circumstances where, having justified pursuant to s15, they might fail in respect of one or other of them. If, of course, they fail to justify both of them, then both will enjoy their original status as imputations pleaded by the plaintiff for the purpose of s16(2)(c) in relation to any remaining contextual imputations in the strict sense.

17 The next category is made up of contextual imputations (C) and (D) which, in shorthand, can be referred to as the “ICAC” contextual imputations.

18 The next category is made up of contextual imputations (E) to (H) which I will describe as the “Minister for Police” imputations.

19 Turning to the “ICAC” imputations: it is to be noticed that contextual imputation (C) uses the phrase “in seeking to influence…” and “afforded reasonable grounds for a finding of … corrupt conduct”. Contextual imputation (D) refers to the plaintiff having “conducted himself” as to afford “reasonable grounds for suspicion” that the conduct engaged in was “influencing” Members of Parliament, as opposed to “seeking to influence”. To that extent it can be said that as a matter of form the contextual imputations (pleaded as they are both cumulatively and in the alternative) differ in substance, although there presently is no requirement, save in the case where they are pleaded in the alternative, that they do so: Hepburn v TCN Channel Nine Pty Ltd [1984] 1 NSWLR 386 at 400F. The difference, shortly stated, is the first imputation, (C), points to “guilt” and the second to “suspicion”.

20 It was sought to be suggested by counsel for the defendants that in resolving the issue of capacity I should have regard to what the jury in fact found in the 7A trial, namely the two imputations pleaded by the plaintiff, each of which is an imputation of “guilt” or actual conduct. In the course of submissions I indicated the view that I then held, and still do, that the only appropriate way for me to approach the issue was “afresh” by applying the standard of reasonableness in the ordinary reasonable reader (Amalgamated Television Services Pty Ltd v Marsden [1998] 43 NSWLR 158). It is unsatisfactory to speculate as to any particular reason the jury may have had in coming to the conclusion that the matter complained of carried the imputations of guilt even if it can be understood to have been properly instructed on both the issues of law, the relevant question of fact, and the submissions made to it by counsel for the parties. I am concerned with the determination of defences as required by s7A(4)(a) of the Defamation Act 1974.

21 The imputations pleaded by the plaintiff and found by the jury are “crisp” compared to the convoluted wording of each of the proposed contextual imputations pleaded by the defendants. However the former, of course, make no reference to ICAC whereas the latter are anchored in the role of that body. Notwithstanding these general observations, or even taking them into account, for my part, the whole tenor of this article against which the contextual imputations are to be judged is of allegations, “probes”, “ongoing investigations” and “claims” and is incapable of carrying contextual imputation (C). It is however, I am persuaded, arguably capable of carrying contextual imputation (D).

22 I shall return to the s16(2)(c) component in due course.

23 The clutch of contextual imputations made up of (E-H) were described in submissions by counsel for the plaintiff as “devised” and “tendentious” and simply on any reasonable basis cannot be understood as arising from this article.

24 The key paragraphs on which reliance is placed by the defendants are paragraphs 14 and 15 of Schedule A;

14. After years of allegations of conflicts of interests over his part-ownership of three Sydney hotels and his Police Ministry duties, Mr Whelan’s family interests now face renewed scrutiny.

15. Mr Whelan has previously denied any conflict, saying he has no involvement in the day-to-day running of the businesses.

25 It is trite to observe that the question of capacity (in this context especially) is concerned with whether or not a matter complained of carries imputations which the defendants hope they can prove, as opposed to whether hopefully the matter complained of carries imputations which the defendants might be convinced they can prove. Again, it must be remarked that these four contextual imputations are extraordinarily verbose. The more is that comment available when particular attention is paid to the two of the paragraphs of the matter complained of on which the defendants particularly rely. This matter complained of is concerned with travel allowances, allegations, claims, probing and so on as I have mentioned above.

26 As to contextual imputations (E) and (F), the defendants were obliged to argue that if there exists a conflict of interests (as referred to in paragraph 14) then it must follow that the person in whom the conflict exists has failed to take steps to avoid the conflict (assuming a contemporaneous awareness of existence of the conflict in that person, I add): the two things are, in substance, the same. It is acknowledged by the defendants that the two extracted paragraphs from the article contain references to “allegations” of conflicts of interests and to the first plaintiff (Mr Whelan) having “previously denied” that conflict. It is submitted however that those matters are not sufficient to overcome the conclusion that the two contextual imputations are capable of arising. It is necessary to look at the whole of the article which makes it plain, it is submitted, that the allegations have gone on “for years” and that Mr Whelan’s family interests now face “renewed scrutiny”. True it is that there are such statements made in the matter complained of. But the statements are made in a context, overall, of the travel agency and refer but historically and elliptically to the plaintiff’s asserted part-ownership of three hotels and his duties as Police Minister. The last mentioned factor, however, it is submitted, suggests, or is capable of suggesting, to the ordinary reasonable reader that the first plaintiff is a person who failed to understand his public duties as the Police Minister. By that I understand the defendants to be saying that he failed to understand his public duties as the Police Minister vis-à-vis the police. These matters, it is said, are sufficient to found an imputation based upon an actual conflict of interest (or a failure to avoid it) and not merely allegations of such a conflict. Recourse is had to the general discussion in Lewis v Daily Telegraph [1964] AC 234 at 284 in relation to rumours founding imputations of guilt (see also Rigby v John Fairfax Group Pty Ltd, unreported, NSWCA, 1 February 1996 at 3 and 8; Dunsec Pty Ltd v Nationwide News Ltd [2000] NSWCA 155 at paragraphs [13] to [20]; Keating v Newcastle Newspapers Pty Ltd(No 2) [2001] NSWSC 106 at paragraphs [8] to [21] per Kirby J).

27 I have little difficulty in concluding that this matter complained of is incapable of carrying contextual imputation (E) and (F). How any ordinary reasonable reader could extract from paragraphs 14 and 15, which commence with “After years of allegations of conflicts…” positive assertions in so convoluted a manner giving rise to the concept of failing to take steps to avoid a conflict, escapes me. The description on the part of counsel for the plaintiff, “tendentious” and “devised” is apt.

28 With respect to contextual imputations (G) and (H), these go further than (E) and (F) by introducing the notion of the New South Wales Police Officers being placed in positions of what I will call “embarrassment”.

29 It is argued for the defendants that the matter complained of, particularly paragraphs 14 and 15, makes it plain to the reader that Mr Whelan was a person who was not only the Police Minister but also was part-owner of three Sydney hotels. It is then submitted that the reader would have no difficulty in concluding as a direct consequence of Mr Whelan having public duties and private interests in conflict, at the same time, that he was acting inappropriately and therefore contrary to the public interest and/or in abuse of his position as Police Minister, and was acting inappropriately in that position by placing police in the invidious position, not referred to in the matter complained of, but referred to in a set of appended particulars. It is argued for the defendants that the ordinary reasonable reader would understand that the Police Minister cannot oversee how the police police him and his hotel interests.

30 In response to the essence of the plaintiff’s submissions that there is nothing alluded to in any way in the first matter complained of that could reasonably be encompassed by the proposed contextual imputations, recourse is had (on a capacity basis) to the attributes of the ordinary reasonable reader who is said to be not naïve, can read between the lines in the light of the reader’s general knowledge and experience of the affairs of the world, that the readers capacity for implication is much greater than that of a lawyer and is capable of a degree of loose thinking: Farquhar v Bottom [1980] 2 NSWLR 380 at 386. It is argued that these contextual imputations are neither strained nor forced nor utterly unreasonable (see Jones v Skelton (1963) 63 SRNSW 644 at 650; Marsden, above, at 165C). I disagree with this last proposition; the contextual imputations are strained, forced and utterly unreasonable.

31 I have no difficulty in coming to the view that the first matter complained of is incapable of carrying, as a matter of law, the “Minister of Police” contextual imputations. I will strike out (E) – (H).

Defamation Act

32 The section is in the following terms:

16(1) Where an imputation complained of is made by the publication of any report, article, letter, note, picture, oral utterance or other thing and another imputation is made by the same publication, the latter imputation is, for the purposes of this section, contextual to the imputation complained of.

(2)

It is a defence to any imputation complained of that

(a) the imputation relates to a matter of public interest or is published under qualified privilege,

(b) one or more imputations contextual to the imputation complained of:

(i) relate to a matter of public interest or are published under qualified privilege, and

(ii) are matters of substantial truth, and

(c) by reason that those contextual imputations are matters of substantial truth, the imputation complained of does not further injure the reputation of the plaintiff.

33 By reason of one only of the expressly pleaded contextual imputations surviving, the application of the test will arise only in the event of the defendants failing to prove one of the plaintiff’s imputations to be true, and having proved the other and the contextual imputation to be true. If the defendants succeed in proving both the plaintiff’s imputations to be true, their defence under s15 will prevail.

34 The question of law is whether the nature of the defendants’ contextual imputations (or the combined effect of them) is or are such that its or their substantial truth is capable of being rationally considered by the tribunal of fact as so affecting the reputation of the plaintiff that the imputations pleaded by the plaintiff, to which the defendants’ contextual imputations are pleaded, cannot further injure that reputation (see Allen v John Fairfax & Sons Ltd, unreported, NSWSC, Hunt J, 2 December 1988 at 8; Hepburn v TCN Channel Nine Pty Ltd at 400B-C).

35 As the defendants have submitted, as far as the question at a final hearing is concerned, it is not merely whether the combined effect of the defendants’ contextual imputations is “greater than” the effect of the plaintiff’s imputations to which they are pleaded, because the defence would fail if the plaintiff’ imputations would still have some effect on the reputation of the plaintiff notwithstanding the effect of the truth of the defendants’ contextual imputations.

36 It is the custom in the Defamation List for the term “swamp” to be used. It can only be used as shorthand for the above proposition. The defendants need to show no more than that, as the section says, the truth of the contextual imputation so affected the reputation of the plaintiff that the publication of the plaintiff’s imputations to which they were pleaded did not cause “additional injury to that reputation” (Hepburn at 405B-E). A strike-out application based on this test can only succeed in what is described as the “extreme” case that an argument that the truth of the defendants’ contextual imputations (even in combination) in effect made the plaintiff’s imputations superfluous, was “doomed to failure” or manifestly hopeless (Agar v Hyde (2000) 201 CLR 552 at 575-576 [57]). It still remains the case that if it is merely a question of degree then the matter must be left to the final hearing: Jackson v John Fairfax & Sons Ltd [1981] 1 NSWLR 36 at 39; Harb v Illawarra Newspapers Holdings Pty Ltd, unreported, Levine J, 10 November 1995 at 5).

37 These propositions have been advanced by the statements of Spigelman CJ (with whom Rolfe AJA agreed) in John Fairfax Publications Pty Ltd v Blake;David Syme & Co Ltd v Blake (2001) 53 NSWLR 541. Spigelman CJ (at 543.5) said:

“Section 16(2)(c) does not focus attention on a contextual imputation

such

but on the proposition that such an imputation is a "matter of substantial truth". It is "by reason" of such "substantial truth" that a defence to an imputation pleaded by a plaintiff can be made out on the basis that the plaintiff’s imputation does not "further injure the reputation of the plaintiff". For purposes of determining whether the s16 defence is capable of being made out, the Court must focus on the facts, matters and circumstances said to establish the truth of the contextual imputation, rather than on the terms of the contextual imputation itself”.

Blake

38 In the proposed Further Amended Defence the defendants particularise their case of truth pursuant to SCR Pt 67 r 18(1)(c) in relation to the plaintiff’s imputations (a) and (b) by relying on the same material. In relation to contextual imputation (D) the defendants rely upon the particulars in support of plaintiff’s imputation 5(a) and a set of particulars otherwise which would have been relied upon in support of contextual imputation (C). In the end, having particularised conduct, the defendants particularise inferences from that conduct in the light of the provisions of the ICAC Act. I interpolate that insofar as complaint is made by the plaintiff that the defendants appear to be relying upon a code of conduct promulgated after the date of publication of the matters complained of, that by itself does not derogate from the availability of the case particularised, but will no doubt be the subject of some attention at the final hearing.

39 I have come to the view that whilst the remaining contextual imputation pleaded in addition to those of the plaintiff can be characterised as one of less seriousness, in the light of the judgment of the Court of Appeal in Blake I must decline to strike out the contextual imputation as not rationally being capable of satisfying s16(2)(c). There has been a shift of emphasis or focus as a result of Blake, and the structure of the defence case in terms of the particulars relied upon compel the reservation of that issue to trial. The shift of emphasis to which I refer is from any “assumption” as to the truth of the contextual imputation to the case made in support of it.

Polly Peck

40 With respect to the first and second publications concerning the first plaintiff, the defendants have repeated the imputations pleaded by them as contextual imputations in respect of publication in New South Wales. These pleadings seek to rely upon those meanings in respect of interstate publications as giving rise to a defence based on a decision of the English Court of Appeal in Polly Peck (Holdings) PLC and Ors v Trelford & Ors [1986] QB 1000 (“Polly Peck”). Whilst I will be making general observations as to the availability of Polly Peck defences, it has to be borne in mind that in respect of the first publication its availability is considered only in terms of the one remaining contextual imputation.

41 A statement of the principle to be derived from Polly Peck is constituted by that which was said by O’Connor LJ in the Court of Appeal at 1032A-E:

“In cases where the plaintiff selects words from a publication, pleads that in their natural and ordinary meaning the words are defamatory of him, and pleads the meanings which he asserts they bear by way of false innuendo, the defendant is entitled to look at the whole publication in order to aver that in their context the words bear a meaning different from that alleged by the plaintiff. The defendant is entitled to plead that in that meaning the words are true and to give particulars of the facts and matters upon which he relies in support of his plea, as he is required to do by R.S.C., Ord. 82. It is fortuitous that some or all of those facts and matters are culled from parts of the publication of which the plaintiff has not chosen to complain.

Where a publication contains two or more separate and distinct defamatory statements, the plaintiff is entitled to select one for complaint, and the defendant is not entitled to assert the truth of the others by way of justification.

Whether a defamatory statement is separate and distinct from other defamatory statements contained in the publication is a question of fact and degree in each case. The several defamatory allegations in their context may have a common sting, in which event they are not to be regarded as separate and distinct allegations. The defendant is entitled to justify the sting, and once again it is fortuitous that what is in fact similar fact evidence is found in the publication”.

42 It is not inappropriate to align Polly Peck with the almost contemporaneous decision of another Bench of the English Court of Appeal in Lucas-Box v News Group Newspapers Ltd [1986] 1 WLR 147, in respect of which O’Connor LJ remarked (1032H-1033A):

“…the practice which dictated that a defendant does not state in his defence what he alleges is the natural and ordinary meaning of the words complained of is ill-founded and should not be followed. That case has decided that a defendant who pleads justification must state the meaning which he seeks to justify. It follows from that case and this that in future, where differences of meaning are proposed by the parties, the issue as to the possible meanings of the words will be confined to those pleaded”.

43 The plaintiff in his submissions does not dispute the existence of authority as to the availability of a Polly Peck defence in this country. Reference is made, inter alia, to the following decisions: Gumina v Williams (No 2) [1990] 3 WAR 351 (Full Court of Supreme Court of Western Australia); Kennett v Farmer [1988] VR 991; Kelly v Special Broadcasting Service [1999] VR 69; Curran v Herald and Weekly Times, unreported, Supreme Court of Victoria, 28 September 1993. It has been accepted in judgments of the Supreme Court of the Australian Capital Territory: TWT Ltd v Moore (1991) A Def Rep 51,030; Woodger v Federal Capital Press of Australia Pty Ltd (1992) 107 ACTR 1. Dowset J was of the view that it applied: Grundmann v Georgeson (1996) Aust Torts Rep 63,500 at 63, 513 as was Mildren J in the Supreme Court of the Northern Territory: Hart v Wrenn (1995) 5 NTLR 17; see also Drummond J in Random House Australia Pty Ltd v Abbott (1999) 94 FCR 296 at 333 paragraph [178] and Marsden v Amalgamated Television Services Pty Ltd [2001] NSWSC 510 at [2916].

44 The Court of Appeal in Queensland in Robinson v Laws [2001] QCA 122 held that it was not available as a defence in that State (an application for Special Leave to Appeal to the High Court was dismissed on 19 March 2002). Further, one can consider Wallace v Wallace [2001] WASC 134 and the decision of the Court of Appeal of Victoria in David Syme & Co Ltd v Hore-Lacy [2000] 1 VR 667 as reaffirming, at the very least, the state of flux.

45 In their judgment in Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 at 527-8 Brennan CJ and McHugh J said, having cited a passage from O’Connor LJ in Polly Peck (at 1032):

“With great respect to his Lordship, such an approach is contrary to the basic rules of common law pleadings and in many contexts will raise issues which can only embarrass the fair trial of the action. Leaving aside technical pleas such as pleas in abatement, defences are either by way of denial or confession and avoidance. A defence which alleges a meaning different from that of the plaintiff is in the old pleading terminology an argumentative plea of Not Guilty. Under the principles of pleading at common law, it could tender no issue and would be struck out as embarrassing. Under the modern system, articulating an alternative meaning could conceivably make explicit the ground for denying a pleaded imputation. But it would be only in such a case that a defendant's plea of a new defamatory meaning might be supportable as a plea which prevents the plaintiff being taken by surprise. A plea of justification, fair comment or qualified privilege in respect of an imputation not pleaded by the plaintiff does not plead a good defence. It is immaterial that the defendant can justify or otherwise defend the meaning which it attributes to the publication. In our view, the Polly Peck defence or practice contravenes the fundamental principles of common law pleadings. In general it raises a false issue which can only embarrass the fair trial of the actions”.

46 For the plaintiff it is contended that the judgment of Brennan CJ and McHugh J in Chakravarti is “unambiguous” in its opinion that the Polly Peck defence is not available under Australian law. It certainly is unambiguous in what it says. In that case, Gaudron and Gummow JJ discuss the defence in the terms indicating an assumption, rather than a considered conclusion that such a defence is available (see for example at 544); Kirby J did not consider the question.

47 One pertinent view of the status of Chakravarti is that of Hedigan J in Carrey v ACP Publishing Pty Ltd [1999] 1 VR 875 at 885-6:

“There is no doubt that the

Polly Peck

plea has become firmly entrenched in virtually all jurisdictions in Australia and has been recognised and acted on as part of the common law. I refer to the cases cited in the judgment of Brennan, C.J. and McHugh, J. (para.7 footnote 4) and, with respect to the State of Victoria, the

National Mutual Life Case

(although the Court drew back from specifically stating that the principle was part of the common law in this State). See too

Curran v. Herald & Weekly Times

(Gobbo, J., unreported, 28th September 1993) a valuable and thoughtful analysis; and

Kelly v. Special Broadcasting Service

[1990] V.R. 69 at 72. For a judge sitting at first instance, the judgments of the members of the High Court in

Chakravarti

generate uncertainty, not guidance nor binding authority on this aspect. The Victorian cases to which I have referred all proceed on the basis that the

Polly Peck

defence may be pleaded and raised. Until the Court of Appeal, or the majority of the High Court, declare that it is not the law, I regard myself bound to treat it as the law of Victoria. Moreover, since the present position in Victoria appears to be that in a jury trial the jury is free to find a publication defamatory, even on a basis not argued for, so long as not specifically withdrawn, the application of the views of Brennan and McHugh, JJ. may be doubted, as they appear to be underpinned by the concept that the plaintiff can only succeed on the case argued for, i.e. on the pleaded meanings”.

48 Hedigan J later made the following observation (Hore-Lacy v David Syme & Co Ltd [1998] VSC 96 at [18]):

“If the views of Brennan, C.J. and McHugh, J. were applied to this case, the position would be that the defendant would not be permitted to plead a meaning different from that contended for by the plaintiff. The defendant would be in the position of either simply denying the plaintiff's meanings or alternatively justifying them if they were established. The views as expressed by Brennan, C.J. and McHugh, J. did not command any articulated support by the other members of the Court who sat in

Chakravarti

. No views have been expressed in other cases by the balance of the members of the High Court of Australia. Although the Full Court in

National Mutual

, having regard to the circumstances in which the appeal came to it, stopped short of approving the application of the

Polly Peck

principles in Victoria, they did not disapprove them. It can hardly be denied that in Victoria and all States in Australia the

Polly Peck

form of pleading has been permitted over the last decade”.

49 The appeal (David Syme & Co Ltd & Anor v Hore-Lacy [2000] VSCA 24) to the Court of Appeal of Victoria with the utmost respect does not add clarity to the resolution of the question of whether or not Polly Peck is available or not available. Whilst the dissenting judgment of Callaway J is tolerably clear (see p691.72) it cannot be taken, in my view, that the judgments of Ormiston and Charles JJA, whilst indicative of their sympathy to the views of Brennan CJ and McHugh J in Chakravarti, do go so far as to proscribe the availability of the defence in Victoria. In this regard I agree, expressly, with the analysis of Simpson J in Sydney Refractive Surgery & 3 Ors v Beaumont & 2 Ors [2002] NSWSC 638 at paragraphs [49] and [50].

50 I interpolate the learned commentary can expose differing views as to the status of Polly Peck and the effect of Chakravarti: see Anthony J H Morris QC, “Polly Peck defence: Its future in Australia” 74 ALJ 760 (November 2000) at 769 on the one hand, and on the other, Maher: “Defamatory meaning and the defence of truth: Polly Peck in Australia” (1993) 1 Torts Law Journal 219 at 229.

51 Until there are enunciated clear and authoritative statements from the appropriate appellate courts in each State and Territory in which the problem arises (compare Robinson v Laws, supra) the ultimate decision as to the availability of the Polly Peck defence will have to be determined by the High Court.

52 In the meantime I propose to conform with what I perceive to be the more generally held view that a defendant in an appropriate State or Territory is entitled to plead a Polly Peck defence and thus will decline to strike out the pleading of it.

53 For the plaintiff it was submitted, albeit briefly, that the decision of the High Court in John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 makes it clear that New South Wales procedures govern the conduct of the action. Accordingly, it is argued, once the s7A trial is over, the jury’s function is exhausted and there is no scope for the defendants to advance Polly Peck imputations. This, as far as I understand it, as a proposition simply cannot be right. A defence is a substantive, not procedural, right affecting the existence, extent or enforceability of the rights of the parties: Pfeiffer at 99-100 and 102. Further, it is not the function of a jury in a trial conducted under s7A of the Defamation Act to determine whether any meanings upon which a defendant proposes to rely in fact arise from the matters complained of. That section is concerned with the jury’s function vis-à-vis only the imputations pleaded by the plaintiff (see s7A(1), (2) and (3)). Ss(4) of s7A makes it clear that upon the jury’s determining the issue left to it, it is for the Court “to determine whether any defence raised by the defendant” has been established. It must and can only include defences under s15 and s16. There may be arguments in favour of the desirability (within New South Wales) of the 7A jury determining whether the matter complained of carries both the meanings pleaded by the plaintiff and if it does, carries any other meaning sought to be advanced by the defendant, even though that may bring about some interesting problems in the judge’s directions.

54 In respect of the first matter complained of by paragraph 5 of the Proposed Amended Defence the defendants plead in paragraph 5(a) justification in the strict sense in relation to publications in all States and Territories other than New South Wales (“true in substance and in fact”), and in respect of the publication in Queensland Tasmania and the Australian Capital Territory that the publication was made for the public benefit.

55 In paragraph 5(b)(1) and (2) in respect of the publication in Victoria, Western Australia, South Australia and the Northern Territory, the Polly Peck defences and imputations are pleaded in the event that the plaintiff’s imputations are not found to be true in substance and in fact.

56 Paragraph 5(b)(3) of the proposed Further Amended Defence is in the following terms:

5(b)(3) further and in the alternative:

(A) the defendants repeat the matters pleaded in (b)(1) above;

(B) by virtue of the substantial truth of the Defendant’s First Imputations, the first plaintiff’s reputation was not further injured by any remaining paragraph 5 imputation or the matter complained of;

(C) alternatively, to the extent that the defendants prove the truth of any imputation on which the defendants rely, the matter complained of and/or the imputations was/were true in substance and in fact;

(D) by reason of the matters pleaded in (B) and/or (C) above, the defendants are not liable to the first plaintiff as alleged, or alternatively, not liable in part to the extent that that part of the matter complained of and/or the imputation or imputations relied on is/are found to be true in substance and in fact.

“partial justification”

57 I must say that my first reaction to the pleading is one of uncertainty as to what precisely the defendants are seeking “partially” to justify, in the context of the “express” Polly Peck defences and the express justification defences in the strict sense. What is particularly unclear is the reference to “that part of the matter complained of” referred to in (D).

58 The defence of “partial justification” in modern defamation law was usefully summarised and placed in context by Myles CJ in Woodger v Federal Capital Press of Australia Pty Ltd (1992) 107 ACTR 1 at 23-4:

“1. Where the plaintiff's claim raises expressly or by implication several distinct defamatory meanings, the defendant may seek to justify any one of them: see

Howden v. "Truth" and "Sportsman" Limited and Another (No. 2)

(1938) 38 SR (N.S.W.) 287. This is the defence of partial justification.

2. Where the plaintiff alleges several distinct defamatory

meanings but there is arguably a "common sting" to them upon which the plaintiff does not expressly rely, then the defendant may seek to justify the common sting and the plaintiff is not entitled to restrict the defendant to seeking to justify the several meanings selected by the plaintiff. This has been referred to as the

Polly Peck

principle:

Khashoggi v. I.P.C. Magazines Ltd. and Another

(1986) 1 WLR 1412 at 1417. I call it the first

Polly Peck

principle.

3. Where the plaintiff alleges a defamatory meaning or several distinct defamatory meanings but the defendant denies the meaning or meanings alleged by the plaintiff and asserts an arguable claim that in the context of the whole publication a different defamatory meaning or several different defamatory meanings from that or those alleged by the plaintiff, the defendant may seek to justify that different defamatory meaning or meanings and again the plaintiff is not entitled to restrict the defendant to seeking to justify the meaning or meanings elected by the plaintiff. That was the effect of what was said in

Polly Peck

by O'Connor L.J. (at 868-9), Goff and Nourse L.JJ. agreeing, and I call it the second

Polly Peck

principle.

4. Where the plaintiff alleges a particular defamatory meaning, the defendant may, without denying that defamatory meaning, seek to assert a separate and

additional defamatory meaning which is justified and the effect of which is so serious that there can be no further injury to the plaintiff's reputation caused by the meaning upon which the plaintiff relies. This is what is called in New South Wales the defence of contextual imputation. In my view, it applies in the Australian Capital Territory.

5. The defendant may, should, or "in a case where there are several stings, perhaps must" (

Kelly v. Special Broadcasting Service

(1990) VR 69 at 74, per Murphy J.) plead or give particulars of any defamatory meaning which the defendant will seek to justify, whether or not such defamatory meaning has been pleaded by the plaintiff. This is simply a modern rule of pleading which enables any of the defences abovementioned to be put properly before the Court”.

59 The case to which his Honour refers in paragraph 1 of his summary (Howden) gave rise to statements in the High Court and the Full Court of New South Wales, each of which presupposes the existence at common law of the right to plead partial justification.

60 In the High Court (1937) 58 CLR 416 at 431 Evatt J said:

“Where part only of a libel can be justified, no further complication arises. Such a justification in part is possible for two reasons, first, so far as concerns civil liability in England, “the speaking of the truth is not a ground of legal liability at all” (T A Street, Foundations of Legal Liability, (1906), vol 1, p 275) so that “the very conception of defamation involves the idea of falsity” (ibid., p 300); secondly, because of such general conception, the evidence of truth in relation to a defamatory imputation, if established after an apt pleading, may be regarded as entirely obliterating that imputation, and as leaving the ground open for dealing with the residue of the untrue imputation. In other words, the defence of truth can operate “distributively,” and so may protect pro tanto”.

61 In the Full Court in the subsequent proceedings consequent upon the filing of an Amended Plea after the High Court appeal (1938) 38 SR(NSW) 287 at 291, Jordan CJ, in an especially useful way, said:

“There can be no doubt that, at common law, in a civil action, “a justification need not be to the whole, but may be to a part. If a man says that a certain neighbour of his was guilty of manslaughter and was also a thief, it is perfectly open to take a plea in justification of either charge only”:

Sutherland v Stopes

[1925] A.C. 47 at 78. It is, however, necessary that the part sought to be separately justified should be severable, and also that the pleading should clearly indicate exactly what the severed part is which is sought to be separately justified.

The question whether an allegation is severable is one of substance and not of form. The test is whether it is a substantially separate and self-contained allegation, or whether it is merely one ingredient of a connected whole which, when taken as a whole, conveys a damaging imputation that is not contained in its parts taken separately.

Further, the plea of justification must be so framed that it can be seen exactly to what part of the matter complained of it is addressed. The form, “As to so much of the matter complained of as alleges (the matter sought to be justified, stated in general terms)”- justification, is permissible where the alleged libel is so framed that it is obvious what is referred to; but where the use of such a form would give rise to doubt as to what is covered by it, the part sought to be justified must be explicitly stated:

Stiles v Nokes

: 7 East 492; Fleming v Dollar 23 Q.B.D. 388”.

62 It is the first part of the extract from the judgment of Jordan CJ which is cited by Tobin and Sexton in their Australian Defamation Law and Practice, when discussing the concept of partial justification ([11,040]).

63 The emphasis placed by Jordan CJ on severability and proper pleading is to be noted.

64 As the defendants argue, the concept of severability is probably one of fact.

65 In Clarke v Taylor & Anor ((1836) 2 Bing (N C) 654) the plaintiff complained of a libel charging him with swindling at Manchester. The libel also suggested swindling at Leeds. The defendant justified the Manchester allegation but not the Leeds allegation and the Court of Common Pleas upheld the jury verdict for the defendants on the part of the libel which was justified and refused to enter a verdict for the plaintiff on the passage not justified.

66 Tindal CJ said (at 664.9-665.4):

“There can be no doubt that a defendant may justify part only of a libel containing several distinct charges. That was established in

Styles v Noakes

(7 East, 492), where Lawrence J said “ a plea of justification may be good with a general reference to certain parts of the libel set forth in the declaration, if the Court can see with certainty what parts are referred to; as if the reference be to so much of the libel as imputes to the plaintiff such a crime, (eg perjury,) that would be sufficient without repeating all those parts again, which would lead to prolixity of pleading, and ought to be avoided.” But if he omits to justify a part which contains libellous matter, he is liable in damages for that which he has so omitted to justify. The plea in the present instance does not affect to justify the whole of the publication, and we are to see whether the part omitted would, by itself, form a substantive ground of an action of libel. I cannot say that it is of that description. The general charge against the Plaintiff is, that he was concerned in a grand swindling transaction. At the outset, the Court cannot help seeing that the place intended to be referred to as the scene of the transaction is Manchester alone. The newspaper in which the libel appears is published there; and after calling the attention of its readers to what had recently taken place in the town of Manchester, it goes on - …”.

67 Tindal CJ said that part which dealt with the plaintiff’s action at Leeds “has a tendency the same way; but only a tendency; and as the Plaintiff himself has not affixed a bad sense on it, I cannot see why we should do so” (at 666.4).

68 The reference by Jordan CJ to Sutherland v Stopes [1925] AC 47 warrants amplification; the passage to which his Honour was referring is the following in the speech of Lord Shaw of Dunfermline:

“But a justification need not be to the whole, but may be to a part. If a man says that a certain neighbour of his was guilty of manslaughter and was also a thief, it is perfectly open to take a plea in justification of either charge only.

In Clarke v Taylor Tindal C.J. said: “There can be no doubt that a defendant may justify part only of a libel containing several distinct charges…But if he omits to justify a part which contains libellous matter, he is liable in damages for that which he has so omitted to justify. The plea in the present instance does not affect to justify the whole of the publication, and we are able to see whether the part omitted would, by itself, form a substantive ground of an action of libel. I cannot say that it is of that description”.

It remains to be considered what are the conditions and breadth of a plea of justification on the ground of truth. The plea must not be considered in a meticulous sense. It is that the words employed were true in substance and in fact. I view with great satisfaction the charge of the Lord Chief Justice when he made this point perfectly clear to the jury, that all that was required to affirm that plea was that the jury should be satisfied that the sting of the libel should be made out. To which I may add that there may be mistakes here and there in what has been said which would make no substantial difference to the quality of the alleged libel or in the justification pleaded for it. If I write that the defendant on March 6 took a saddle from my stable and sold it the next day and pocketed the money all without notice to me, and that in my opinion he stole the saddle, and if the facts truly are found to be that the defendant did not take the saddle from the stable but from the harness room, and that he did not sell it the next day but a week afterwards, but nevertheless he did, without my knowledge or consent, sell my saddle so taken and pocketed the proceeds, then the whole sting of the libel may be justifiably affirmed by a jury notwithstanding these errors in detail.

In the second place, however, the allegation of fact must tell the whole story. If, for instance, in the illustration given, the facts as elicited show what my writing had not disclosed- namely, that the defendant had a saddle of his own lying in my harness room, and that he took by mistake mine away instead of his own and still labouring under that mistake, sold it- then the jury would properly declare that the libel was not justified on the double ground that there were facts completely explaining in a non-criminal sense anything that was done, and the jury would disaffirm the truth of the libel because, although meticulously true in fact, it was false in substance.

Then, as to the breadth of the justification. When a plea of truth in substance and in fact is made it affirms not only in the sense I have mentioned the facts, but it affirms all that attaches to them as their natural and reasonable meaning. I think the charge of the Lord Chief Justice was correct upon that aspect of the case also. This point as to the breadth of the justification is an essential matter to be regarded where the “rolled up plea” is taken, because that “rolled up plea” by law assumes the truth of the facts in the libel and quoad opinion pleads a fair comment as to that. The assumption as to the facts being true must similarly be interpreted by the breadth to which I have referred – namely, that the facts, whether justified as true or assumed to be true, carry with them all that these facts reasonably and naturally imply. And secondly, the point as to fair comment with regard to opinion is only reached when there is separate matter in the words used- separate matter of expressed opinion which goes beyond the natural meaning attaching to the facts, but which for all that may be perfectly within the right of a free citizen, and not to contain any separate actionable matter”.

69 In his speech Viscount Cave LC said that if the substantive charge might justly be made, a description of it using words such as “monstrous” or “quite serious” was not a new or separate charge from an allegation of an obscene and criminal campaign, “but a mere shadow of the substantive charge for which a separate justification is not required” (at 59); his Lordship cited as authority what Burrough J had said in Edwards v Bell ((1825) 1 Bing 403 at 409) who said: “…as much must be justified as meets the sting of the charge and if anything be contained in the charge which does not add to the sting of it, that need not be justified”. Viscount Cave LC concluded that if epithets are, in gravity, such as fall below the substantive charge and add nothing to it, they need not be separately justified (at 59; see also Viscount Findlay at 72 and Carson LJ at 95).

70 In Plato Films Ltd v Spiedel [1961] AC 1090 Lord Denning discussed the issue of partial justification by reference to a submission made by counsel for the defendant (Gerald Gardiner QC) at 1141-2):

“…suppose a newspaper said of a man: “He has been convicted six times for “dishonesty,” but, on being sued, the newspaper finds that he has in fact only been convicted twice. The newspaper cannot justify, he said, because it cannot prove the words were true. Nor can it bring forward the two convictions in mitigation of damages because they are specific misconduct. So the plaintiff will get damages on the footing that he has never been convicted at all. If such were the law, I would agree with Mr Gardiner that it would be most unjust and ought to be remedied. But it is not the law. Although the newspaper cannot justify in whole it can justify in part. It can plead that, insofar as the words meant that he had been convicted twice, they were true and thus bring the two convictions before the jury. In

Clarkson v Lawson

Sergeant Wilds put the very case: “If [the Defendant] had charged the plaintiff with stealing three horses, he might have justified as to one,” and Park J said he could. “It was the common practice,” said Sir James Scarlett in one of the cases cited to your Lordships, “if a defendant could not justify all, to justify a part of the libel, and produce witnesses to prove that part justified, as a ground of mitigation and reduction of damages”: see

Waithman v Weaver

. This rule is based on sound sense. Seeing that the law does not permit a defendant, in mitigation of damages, to adduce evidence which tends to justification, it must permit him to adduce the selfsame evidence when pleaded in partial justification: see

Vessey v Pike

by Lord Tenterden CJ. If it were not so, the plaintiff would recover damages for a character which he did not possess or deserve; and this the law will not permit.

But then Mr Gardiner says there are cases where not even a partial justification is open to the defendant, because of the way the plaintiff frames his action. He took this case. Suppose a newspaper said of a man: “He has murdered his father, stolen from his mother and does not go to church on Sundays,” and the plaintiff brings a libel action complaining only of the imputation that he does not go to church. The defendants, said Mr Gardiner, cannot justify the major charges of murder and theft, because the plaintiff has not complained of them. They cannot give evidence of them in mitigation of damages because they are only specific instances. What is, then, the position? It would, says Mr Gardiner, be most unjust that the plaintiff should get damages for the minor matter when, if the jury had had the whole before them, they would have given him nothing. I agree it would. But the answer is that the defendants, who had produced such a piece of bathos, would be entitled, in the apt words of Lord Coke, to “have showed all the words and the coherence of them,” see

Brittridge’s Case

: and the jury would no doubt only have given one farthing, as they did in

Cooke v Hughes

. In those cases the words so “cohered together” that it was necessary for the jury to see all the words in order to make a correct appreciation of their impact. Whether the present is such a case, the judge will say at the trial”.

71 The last paragraph of course points to the effect s16 of the Defamation Act 1974 (NSW) seeks to achieve. Lord Denning, as Master of the Rolls, had occasion to allow an amendment of a defence to permit a plea of partial justification in Goody v Odhams Press Ltd [1967] 1 QB 337.

72 Further, in Prager v Times Newspapers Ltd [1998] 1 WLR 77 the Court of Appeal made it clear that partial justification could not be pleaded unless the charges were separate and severable. The case was to be distinguished from that in which a defendant pleaded that the defamatory matter carried another and lesser defamatory meaning than that contended by the plaintiff and that the lesser meaning was true. For example, Purchase LJ in that appeal, said, at 88-9:

“There is no room in the present case for a plea of “partial justification”. It is clearly open to a defendant to plead in anticipation of any of the reasonable alternative defamatory meanings and to justify on that limited basis. In this regard care must be taken to distinguish between pleading a lesser, and different, defamatory meaning and achieving a partial justification of the whole sting of the libel pleaded by the plaintiff. Although a partially established plea of justification may be considered by the jury in mitigation of damages, it is not open to a defendant to plead specific facts in partial justification of a libel with the sole purpose of mitigating damages. Where the libel contains more than one charge, then a defendant may seek to justify one or some of the charges without justifying all of them but, before pleading justification of any individual charge, as in fraud, counsel is under a duty to satisfy himself that evidence is available to justify the plea”.

73 The defendants in their submissions referred me to some observations made by Neill LJ in Pamplin v Express Newspapers Ltd [1988] 1 WLR 116 at 120 B-E:

“But a defendant is also entitled to rely in mitigation of damages on any other evidence which is properly before the court and jury. This other evidence can include evidence which has been primarily directed to, for example, a plea of justification or fair comment. It is to be remembered that section 5 of the Defamation Act 1952 enables a defendant to succeed on the issue of liability even though he does not prove the truth of all the defamatory material of which complaint is made. The section is in these terms:

“In an action for libel or slander in respect of words containing two or more distinct charges against the plaintiff, a defence of justification shall not fail by reason only that the truth of every charge is not proved if the words not proved to be true do not materially injure the plaintiff’s reputation having regards to the truth of the remaining charges”.

Section 6 of the Defamation Act 1952 contains a similar provision relating to the defence of fair comment, and it is to be noted that from the outset the defendants in the instant case pleaded that they are intended to rely if necessary on sections 5 and 6. There may be many cases, however, where a defendant who puts forward a defence of justification will be unable to prove sufficient facts to establish the defence at common law and will also be unable to bring himself within the statutory extension of the defence contained in section 5 of the Defamation Act 1952. Nevertheless the defendant may be able to rely on such facts as he has proved to reduce the damages, perhaps almost to vanishing point. Thus a defence of partial justification, though it may not prevent the plaintiff from succeeding on the issue of liability, may be of great importance on the issue of damages”.

Rantzen v Mirror Group Newspapers Ltd

74 As the defendants point out, in England s5 of the Defamation Act 1952 effected an extension of the defence of partial justification, as set out by Neill LJ

75 That is the position the defendants contend the common law should “now adopt” (advancing the views of Messrs Duncan and Neil in their text on Defamation (second edition) at [11.09]).

76 It seems clear to me that there is at common law a defence of partial justification. None of the authorities to which I have referred extend the common law defence to the point where, if it succeeds, there should be judgment for the defendant. It is to that extent that the defendant argues that the common law should now be changed.

77 For the plaintiff it is contended that the defendants have conceded that the common law does not presently recognise the existence of such a defence. That misconstrues, as I understand them, the submissions for the defendants. The essence of the common law defence of partial justification goes to a severable meaning which must be “aptly pleaded” and which is amenable to proof. That will go to the mitigation of damages the plaintiff may obtain in respect to the unproved material or meaning. The defendants, as I have said, assert that that partial justification should be extended at common law at least to the extent provided by s5 of the English legislation.

78 For the plaintiff it is further contended that the judgment of O’Connor LJ in Polly Peck itself proscribes partial justification insofar as his Lordship said at 1032:

“Where a publication contains two or more separate and distinct defamatory statements the plaintiff is entitled to select one for complaint and the defendant is not entitled to assert the truth of the others by way of justification”.

79 In my view this misconstrues what his Lordship was saying. The defendants are not entitled to justify the separate distinct meaning with a view to defeating that (untrue) meaning of which the plaintiff expressly complain. That does not derogate from the continued defence of partial justification outside the ambit of Polly Peck, especially when viewed as containing the two principles identified by Myles CJ, above, in Woodger.

80 Accordingly, I am content to hold that a defence of partial justification is still available at common law. It will not defeat the plaintiff’s claim except to the extent of reducing the amount of damages to which a plaintiff may be entitled.

81 It does not follow, however, that the pleading of that defence in the proposed Further Amended Defence can survive scrutiny. In my view it cannot because it pleads nothing as to what it is the defendants propose to justify on the “partial“ basis. This is especially so in relation to what is described as ”that part of the matter complained of” in paragraph (D). The defence therefore is embarrassing to the plaintiff and I strike it out with leave to replead.

82 I turn now to the “common sting”. It is desirable to repeat it:

“The First Plaintiff failed to fulfil his public obligations as a Member of Parliament as a Minister of the Crown in that he placed his personal interests and those of his family above those obligations”.

83 It is to be observed that the “common sting” does not emanate from a vacuum. It must be identifiable by reference to the matter complained of, the imputations pleaded by the plaintiff and the contextual imputations available to the defence. When one considers the terms of the “common sting”, it asserts, and in my view too highly, an abdication by the plaintiff of his duties as a Minister of the Crown and Member of Parliament in favour of personal interests. It clearly suggests that the placing of personal interests transcended the obligations as a Member of Parliament and Minister of the Crown in terms of the plaintiff’s conduct in those offices. Nothing in the matter complained of, nor, more relevantly, in either the plaintiff’s imputations or the remaining contextual imputation, on any reasonable basis, asserts any such sting, that is, failure to fulfil the obligations as personal interests were placed above them. Nothing there suggests the placing of the interests above the obligations. All that can be said is that the first plaintiff had regard to personal interests. Even having regard to personal interests cannot reasonably be understood from the imputations (or the article) as being at the expense of or transcending the performance of his duties as a Member of Parliament or Minister of the Crown.

84 Accordingly I will strike out paragraph 5(4).

85 The second matter complained of was found by the jury to carry the following defamatory imputations of Mr Whelan:

8(a) The first plaintiff had lied when he claimed that his wife had had no interest in Perfect Travel.

8(b) The first plaintiff had lied when he claimed that his wife derived no benefit from Perfect Travel.

8(f) The first plaintiff had so conducted himself as to afford reasonable grounds for suspicion by the Independent Commission Against Corruption that he had engaged in corrupt conduct by influencing other Members of Parliament to use his wife’s travel agency so as to secure private gain for himself and his wife contrary to the public interest.

86 The defendants are justifying, pursuant to s15, imputation 8(f). Otherwise, they plead the following contextual imputations:

(A) the first plaintiff was recklessly indifferent to the truth or falsity of his statement that his wife had no interest in Perfect Travel; and/or

(B) the first plaintiff was unfit to hold office as a Minister because he issued to the public an official press release which contained significant falsities about matters of substantial public interest; and/or

(C) the first plaintiff was prepared to issue an official press release without verifying significant facts in relation to matters of substantial public interest about which he should have made proper inquiries; and/or

(D) the first plaintiff acted seriously against the public interest in that he sought to influence Members of Parliament to use the travel agency in which his wife was a director and shareholder for his family’s private gain; and/or

(E) the first plaintiff abused his position as Minister for Police in that he sought to influence Members of Parliament to use the travel agency in which his wife was a director and shareholder for his family’s private gain; and/or

(F) in seeking to influence Members of Parliament to use the travel agency in which his wife was a director and shareholder and in an attempt to secure financial gain for his family, the first plaintiff’s conduct afforded reasonable grounds for a finding by the Independent Commission Against Corruption (the ICAC) of corrupt conduct on the part of the first plaintiff; and/or

(G) the first plaintiff so conducted himself as to afford reasonable grounds for suspicion by the ICAC that he had engaged in corrupt conduct by influencing other Members of Parliament to use his wife’s travel agency so as to secure private gain for himself and his wife contrary to the public interest (the 8(f) imputation).

87 Interstate defences follow the same structure in relation to the second matter complained of as have been pleaded in relation to the first. In addition to the “justification/Polly Peck” defence the following “common stings” are relied upon:

The first plaintiff failed in his obligation of probity as a Member of Parliament and Minster of the Crown by virtue of his conduct in relation to Perfect Travel; and/or

The first plaintiff was so politically embarrassed by his and his wife’s involvement with the Perfect Travel business that he recklessly put out a false denial of her

involvement in order to cover up his own responsibility for his failure in his obligation as a Member of Parliament and a Minister of the Crown by virtue of his conduct in relation to Perfect Travel.

88 Again it can be seen that the defendants’ contextual imputations fall into categories. 4(2)(A), (B) and (C) relate to what I will describe as the “press release”. Contextual imputations (D), (E), (F) and (G) relate to the travel agency. This cascade of contextual imputations is, amongst other reasons, no doubt pleaded bearing in mind what was said by the Court of Appeal in TCN Channel Nine Pty Ltd v Antoniadis (1998) 44 NSWLR 682 at 693C-E:

“A defendant's ability to combine contextual imputations is therefore subject to legal restrictions and a trial judge may have to rule on whether particular combinations are permissible. A single contextual imputation pleaded to an imputation must differ in substance from it (

Hepburn

at 399,

Jackson v John Fairfax & Sons Ltd

at 39-40),

but where a defendant is entitled to rely on the combined effect of more than one contextual imputation, the only requirement is that their combined effect should differ in substance from the imputation to which they are pleaded (

Hepburn

at 399). A defendant is thus entitled to combine contextual imputations, within limits, but is entitled to have them considered severally, provided they differ from the imputation to which they are pleaded

”.

89 The “limits” referred to, or “when it is appropriate” to combine contextual imputations to have their effect weighed against the unproved plaintiff’s imputations, will no doubt be determined at trial, the more so by reason of the judgment of Spigelman CJ in Blake, referred to above.

90 The preliminary question however remains: namely, whether by the application of the test of reasonableness this second matter complained of, as a matter of law, is capable of carrying these contextual imputations.

91 As to contextual imputation (A), on a capacity argument I am of the view that the matter complained of is capable of carrying this meaning.

92 As to contextual imputation (B), this cannot be carried by the matter complained of insofar as there is no suggestion within it of this posited meaning that, as a Minister, he issued the press release “knowing” that it contained significant falsities.

93 As to contextual imputation (C), I am not persuaded that the matter complained of is capable of carrying an imputation in such terms. This is not on the basis that really it does not differ in substance from contextual imputation (A), but rather that the ordinary reasonable reader could not understand such a generalised, non-specific type of statement about “significant facts”.

94 As to contextual imputation (D), at the 7A trial the jury found as a matter of fact that the second matter complained of did not carry the following imputations:

(c) The First Plaintiff had acted against the public interest by influencing other Members of Parliament to use his wife’s travel agency;

(e) The first Plaintiff, whilst Minister for Police, was a party to an arrangement contrary to the public interest by influencing Members of Parliament in order to obtain private gain for himself and his family.

(d) The First Plaintiff abused his position as Minister for Police by influencing other Members of Parliament to use his wife’s travel agency contrary to the public interest.

95 The defendants concede that if contextual imputation (D) is not different in substance from (c) and (e), then because the jury rejected those imputations then contextual imputation (D) must be incapable of arising. The defendants argue, however, that it is different in substance because of the addition of the word “seriously”, and by reason of the notion of “seeking” to influence Members. It is the last component which saves contextual imputation (D).

96 The same considerations apply to contextual imputation (E) which I decline to hold as incapable of being carried by the matter complained of, notwithstanding the import of the concession to which I have referred above.

97 The matter complained of does provide a foundation for drawing a distinction from actually influencing other members to use the travel agent and seeking to do so. Thus, I find there is a basis for permitting contextual imputations (F) and (G) (the latter being the plaintiff’s imputation in any event) to survive.

98 Thus, I strike out only 4(2)(B) and (C).

Defamation Act

99 What I said in relation to the first publication and the decision in Blake applies here to the surviving contextual imputations.

Polly Peck

100 For the reasons referred to above in relation to the first matter complained I will decline to strike out this defence in the proposed Further Amended Defence, save as to 7(b)(1)(B) and (C).

101 For the reasons set out in relation to the first matter complained of I propose to strike out what I understand to be a pleading of that defence in paragraph 7(3) of the clean copy of the proposed Further Amended Defence with leave to replead.

102 The common sting or stings are:

The first plaintiff failed in his obligation of probity as a Member of Parliament and Minister of the Crown by virtue of his conduct in relation to Perfect Travel; and/or

The first plaintiff was so politically embarrassed by his and his wife’s involvement with the Perfect Travel business that he recklessly put out a false denial of their involvement in order to cover up his own responsibility for his failure in his obligation as a Member of Parliament and Minister of the Crown by virtue his conduct in relation to Perfect Travel.

103 The defendants plead that these “common stings” are said to arise from the matter complained of “in its natural and ordinary meaning”. That is, they must, in my view, be capable, on the basis of reasonableness, of being understood as being carried by that publication by the ordinary reasonable reader. I have little difficulty in concluding, upon the most cursory examination of the wording of each of these so-called “common stings”, that no such reader could be found. The language used in the formulation of these “common stings” is not the language of “meaning”. It is the language of imaginative pleading, advanced more to provide a foundation or yet another basis for proving truth rather than arising from a fair consideration of the publication in question. The ordinary reasonable reader, I hold, could not understand any sting involving notions of “failure in a obligation of probity” or with respect to mere “conduct in relation to Perfect Travel” in the light of what the article is expressly talking about. The same considerations apply to the second “common sting” which is so convoluted in its wording that one can safely conclude that no ordinary reasonable reader could begin to formulate any such meaning in his or her mind.

104 Accordingly, paragraph 7(4) of the proposed Further Amended Defence will be struck out.

105 The plaintiff makes a generalised complaint that the proposed Further Amended Defence is “prolix” and, as I understand it, “oppressive” and should therefore be struck out on discretionary grounds. To this I am not prepared to accede; first, because the plaintiff has succeeded to a substantial extent in having reduced the ambit of the defence of justifications, not least by the elimination of the “Police Minister” contextual imputations relating to the first matter complained of. The defendant is required under the Rules of Court and Practice Note 114 fully to particularise its case on justification (see also McBride v Australian Broadcasting Corporation [2000] NSWSC 747 at [34] and Harb (above) at [3]). Secondly, even allowing for the deficiencies that have led to the various outcomes in relation to the plaintiff’s attack upon the defendants’ pleaded defences, otherwise the issues of law raised in relation to Polly Peck, partial justification and common stings would not be such as easily to lend themselves to summary dismissal (see Bank of NZv Spedley Securities Ltd (In Liq) (1992) 27 NSWLR 91 at 97D; Wickstead v Browne (1992) 30 NSWLR 1 at 5-7 per Kirby P, and Marsden, above, at 2916).

106 The dimensions of this application, not the least the complexities involved, require me to make an additional observation. A plaintiff should give very serious consideration indeed (as should that plaintiff’s lawyers) to the desirability, and indeed necessity, for relying on publication otherwise than in New South Wales. There may be cases where a truly “national” publication about a truly “national” figure will demand reliance upon interstate publication. Otherwise, where the plaintiff is essentially a New South Wales figure, that plaintiff should be content with obtaining (without the immense fuss of interstate components) vindication in respect of publication in this State only.

107 Overall, the parties have enjoyed really and equal degree of success. Accordingly, each side will pay his and their own costs.

108 The orders are:

1. I strike out contextual imputations 2(b)(C), (E), (F), (G) and (H) and all particulars allocated thereto in the Further Amended Defence.

2. I strike out the Polly Peck defence to the extent pleaded in paragraph 5(b)(C), (E), (F), (G) and (H) and all particulars allocated thereto.

3. I strike out the defence of partial justification pleaded in paragraph 5(3)(A), (B), (C) and (D) with leave to replead.

4. I strike out the common sting pleaded in paragraph 5(b)(4) and all the particulars allocated thereto with leave to replead.

5. I strike out the contextual imputations pleaded in paragraph (4)(b)(2)(B) and (C) and all the particulars allocated thereto.

6. I strike out the Polly Peck defence to the extent pleaded in paragraph 7(b)(1)(B) and (C) and all particulars allocated thereto.

7. I strike out the defence of partial justification pleaded in paragraph 7(b)(3)(A), (B), (C) and (D) with leave to replead.

8. I strike out the common sting or stings pleaded in paragraph 7(b)(4) and all particulars allocated thereto with leave to replead.

9. The defendants are to file a Further Amended Defence pursuant to these rulings and leave granted by Friday 22 November 2002.

10. The first plaintiff and the defendants are to pay his and their own costs.

11. The action is to be listed for Directions in the Registrar’s Defamation Directions List on 6 December 2002.

SCHEDULE “A”

1. Exclusive: Police Minister’s wife revealed as boss of travel firm.

2. ICAC probes use of Whelan Agency.

3. By DARREN GOODSIR and HEATH GILMORE.

4. A TRAVEL agency part-owned by Police Minister Paul Whelan’s wife is at the centre of an inquiry into claims politicians were lobbied to use the business to take trips.

5. The Sun-Herald has learned that the Independent Commission Against Corruption (ICAC) is looking at politicians’ use of Perfect Travel, owned by Colleen Whelan, as “an example of an inappropriate use of a travel agency” by politicians.

6. An ICAC report highlights claims that MPs were “encouraged to favour” the agency - which it has refused to identify publicly – in an “inappropriate” arrangement that “was not in the public interest”.

7. “It gave rise to perceptions of favouritism, resulting in private gain for a parliamentary colleague and his family,” ICAC said.

8. Last night, Opposition Leader Kerry Chikarovski said the “grave allegations” needed to be fully investigated.

9. “These are very serious and grave allegations that need to be fully investigated,” Mrs Chikarovski said.

10. “If the reports are correct … the minister involved must stand aside.

11. “If he refuses to do so, then the Premier must step in and act on these matters immediately.”

12. A spokeswoman for the Premier said Bob Carr was unaware of the allegations.

13. “It is difficult to assess anonymous allegations. The ICAC is continuing to investigate a range of matters”, she said.

14. After years of allegations of conflicts of interests over his part-ownership of three Sydney hotels and his Police Ministry duties, Mr Whelan’s family interests now face renewed scrutiny.

15. Mr Whelan has previously denied any conflict, saying he has no involvement in the day-to-day running of the businesses.

16. More than 25 MPs from all parties are under investigation by the ICAC in relation to a year-long probe of NSW politicians’ travel entitlements. There is no suggestion Mr Whelan is one of them.

17. ICAC investigators have found politicians used Perfect Travel, on the fifth floor of the NSW Labor Council Building in Sussex Street, Sydney, to organise travel outside normal parliamentary guidelines.

18. The guidelines state government contractors, Qantas and Travellers, should be contacted to arrange all parliamentary trips.

19. The ICAC said that “although in some instances, the uses of non-government contractors is justified, this is not always the case.”

20. It went on to document politicians’ use of an unnamed travel agency “associated with a particular member’s family”.

21. A spokesman for ICAC said he could not comment on the agency’s identity.

22. But political sources have confirmed to The Sun-Herald that the agency is Perfect Travel.

23. First registered in April 1985, the company has four listed shareholders.

24. Mrs Whelan, 53, is a director with 25,930 of the company’s 77,790 ordinary shares.

25. Prominent Labor Party member Alan John Cree is also listed in Australian Securities and Investments Commission documents as director, holding 25,930 shares.

26. Before joining Perfect Travel, Mr Cree, 56, worked for the State Bank travel agency.

27. In 1984, he was involved in an inquiry into travel expenses claimed by then Sydney Lord Mayor, Labor Alderman Doug Sutherland.

28. Mr Sutherland conceded he travelled to the US on a cheap return fare but claimed and was paid the cost of a first-class fare. At the time, he said he did not make any profit from the transaction, organised by Mr Cree because he used the difference to pay for a ticket for the mayoress and did not claim any other expenses.

29. Neither Mr Sutherland nor Mr Cree was accused of any impropriety over the ticket deal.

30. The ASIC documents show Perfect Travel’s books are now audited by DW Sutherland and Partners of Burwood.

31. Mr Sutherland told The Sun-Herald another partner in his firm handled the accounts, and he was not personally familiar with their operations.

32. Perfect Travel’s remaining shares are divided equally between Ronald and Camille Thurecht.

33. Mr Thurecht, 61, is a property developer and Sydney racing identity.

34. He has owned and bred a number of successful gallopers. One of his better horses Licence Renewed, won the 1996 City Tattersalls Club Cup at Randwick.

35. A spokesman for the Labor Council said Perfect Travel was one of a pool of agencies used to co-ordinate union trips.

36. Last Tuesday, ICAC released its second report into parliamentary and electoral travel.

37. The report, which followed an inquiry into former Transport Minister Brian Langton and his alleged abuse of parliamentary travel entitlements, referred to reports “that certain members were encouraged to favour a travel agent”.

38. A spokesman for ICAC Commissioner Barry O’Keefe said all matters covered in the report were still the subject of ongoing investigation.

39. Legislative Assembly Speaker John Murray criticised the report as being “the sloppiest” he had ever seen, and said he had no knowledge of the agency under investigation.

40. A spokesman for Mr Whelan declined to comment on Perfect Travel and said the Minister had not yet read the ICAC report. Despite repeated attempts during the week, none of Perfect Travel’s shareholders could be reached.

41. Photo with caption SCRUTINY: Colleen and Paul Whelan and Premier Bob Carr. AGENCY: The entrance to Perfect Travel.

42. O’KEEFE’S MESSAGE TO MPs: Page 59.

SCHEDULE “B”

1. Photograph about-face: Whelan

2. MP’s wife quits firm in ICAC report.

3. By DARREN Goodsir and heath gilmore.

4. NSW Police Minister Paul Whelan conceded last night that his wife was part of a firm involved in an ICAC travel rorts inquiry - changing his original story that she had nothing to do with its activities.

5. The belated acknowledgment of Colleen Whelan’s links with Perfect Travel follow Mr Whelan’s repeated statements protesting that there was no involvement.

6. After Mr Whelan stated last week that his wife had “no interest in” the travel agency “since at least 1988”, his lawyers yesterday confirmed she was “until recently” a registered company office holder. They admitted she also had shares but said she had never received any benefits.

7. But inquiries with the Australian Securities and Investments Commission on Friday showed Mrs Whelan was still listed as the firm’s equal biggest shareholder.

8. FULL REPORT” Pages 4,5.

109 PAGE 4

9. MP’s.

10. Paul Whelan says his wife has had no interest in Perfect Travel since 1988.

The records show her shareholding increased four times since then.

11. By DARREN GOODSIR and HEATH GILMORE.

12. NSW Police Minister Paul Whelan last night conceded his wife was part of a firm involved in a travel rorts inquiry – changing his original story that she had nothing to do with its activities.

13. The belated acknowledgment of Colleen Whelan’s links with Perfect Travel follows Mr Whelan’s repeated media statements protesting that there was no involvement.

14. After Mr Whelan stated last week that his wife had “had no interest” in the travel agency “since at least 1988”, his lawyers yesterday confirmed she was “until recently” a registered company office holder.

15. They admitted she also had shares.

16. However, inquiries with the Australian Securities and Investments Commission (ASIC) last Friday afternoon showed Mrs Whelan was still listed as the firm’s equal largest shareholder.

17. Her status has remained unaltered since Perfect Travel’s incorporation in 1985.

18. Only her share stake has changed according to ASIC documents – increasing on four separate occasions in the 10 years that Mr Whelan had claimed she had no financial interest.

19. Last night, Opposition Leader Kerry Chikarovski called for Mr Whelan to stand aside pending a full investigation of the business.

20. “Clearly, these are serious allegations hanging over the head of the Minister charged with restoring confidence in the NSW Police Service”, Mrs Chikarovski said.

21. “If these allegations are true, then the Premier really has no choice but to stand this Minister down immediately”.

22. Last week, Mr Whelan issued a statement accusing The Sun-Herald of a “clumsy attempt” to “smear his family” and said the report on Perfect Travel was “grossly defamatory and wrong”.

23. He has repeatedly declined to speak to the newspaper.

24. In the statement, Mr Whelan said that if his wife’s name was “still on official records then clearly that is an administrative oversight”.

25. Perfect Travel’s managing director, Alan John Cree, supported Mr Whelan’s claims.

26. He described Mrs Whelan’s departure about 1988 as an

informal agreement, but said he had no documents to prove this happened.

27. Wife quits agency.

28. Mr Cree said Mrs Whelan’s appearance on company records was his fault.

29. Official ASIC records still lists Mrs Whelan as a beneficial holder of shares worth $25,930.

30. After being faxed a series of questions on Friday morning, lawyers for Mr Whelan responded at 4.20pm yesterday - but refused to answer specific inquiries.

31. The lawyers, Jones Staff & Co, said: “Mrs Whelan ceased to have an active interest in the travel agency business many years ago”.

32. “Until recently Mrs Whelan remained a shareholder and director in the company Perfect Travel Pty Ltd as accords with the public record”.

33. They admitted their earlier legal correspondence to the newspaper had been “inaccurate” in explaining the truth of her company status.

34. They added that the firm had never declared a dividend and that she had never received any fees or benefits from the company.

35. Government insiders had earlier told The Sun-Herald they believed the Independent Commission Against Corruption (ICAC) was not investigating Perfect Travel, but another agency linked to the Opposition.

36. However, top sources maintained Perfect Travel was under ICAC investigation.

37. Mr Whelan said last week his wife had not ever been to Perfect Travel’s office in the Labor Council Building in Sussex Street, Sydney.

38. But the firm’s auditor, D W Sutherland & Partners, said it had always believed that Mrs Whelan was an active director based on documents provided by Perfect Travel.

39. Company records show that, in the 10 years after Mr Whelan had maintained his wife had left the firm, someone paid cash four times to increase her share holding.

40. Her stake fluctuated from 13,500 $1 shares down to 2,000 shares and back up 25,930 shares.

41. in the last annual return, submitted on October 23, Mrs Whelan is still listed as one of Perfect Travel’s four directors. The other office holders are Mr Cree and Ronald and Camille Thurecht. Mr Cree is the managing director, who has signed almost all of the firm’s official papers.

42. Records show that cash used to boost shares attributed to Mrs Whelan came from funds outside the company.

43. Whenever share changes or allocations take place, all directors must be notified and they must agree on the nature of the transaction.

44. A heading on last week’s article described Mrs Whelan as the boss of the travel firm. The story made one reference to the company as being owned by Mrs Whelan. These were incorrect. The latest ASIC records show Mrs Whelan as the equal major shareholder.

45. EDITORIAL: page 60.

46. THE PERFECT TRAVEL AFFAIR HOW IT UNFOLDED.

47. December 13, The Sun-Herald’s exclusive story.

48. ICAC probes use of Whelan agency.

49. Paul Whelan’s press release denying the story.

50. STATEMENT CONCERNING SUN HERALD STORY PAGE 7, FIRST EDITION

51. Police Minister Paul Whelan said the story in The Sun-Herald was grossly defamatory and wrong.

52. “Mrs Whelan has no interest in and derives no benefit from Perfect Travel” Mr Whelan said.

53. “If my wife’s name is still on official records then clearly that is an administrative oversight”.

54. Australian Securities and Investments Commission.

55. Form 316. Corporations Law 345, 346, 347, 348.

56. The official ASIC records of the 25,930 shares.

57. Annual return of a company.

58. IPC 23 October 1998.

59. Declaration. This declaration must be signed and dated by a current director or secretary of the company. I declare (a) that the information given on this Annual Return of 3 pages and any annexures is complete and correct at the date of signing.

60. WHELAN, COLLEEN ASHFIELD NSW 2131. *** Please add any new members under this line.***

61. Photo Colleen Whelan and Paul Whelan.

62. WHAT THE ICAC REPORT FOUND.

63. LAST week, The Sun-Herald revealed that ICAC was investigating Perfect Travel as “an example of an inappropriate use of a travel agency” by politicians.

64. An ICAC report into alleged parliamentary travel rorts said politicians were “encouraged to favour” the agency which it refused to publicly identify.

65. It said this was an “inappropriate arrangement” that “was not in the public interest”.

66. The ICAC said that the conduct “gave rise to perceptions of favouritism, resulting in private gain for a parliamentary colleague and his family”.

67. It has indicated it may hold further hearings into alleged parliamentary travel rorts.

68. The firm began in 1985, taking over another private company called Elgam.

69. Mrs Whelan is listed as having 25,930 of the firm’s 77,790 shares, according to ASIC documents.

**********

Last Modified: 05/07/2003

CITATION:	WHELAN & ANOR v JOHN FAIRFAX PUBLICATIONS PTY LTD & ORS [2002] NSWSC 1028 revised - 9/04/2003
FILE NUMBER(S):	SC 20499 OF 1998; 20502 OF 1998; 20503 OF 1998; 20556 OF 1999
HEARING DATE(S):	10 October 2001 22 October 2001 25 October 2001
JUDGMENT DATE:	1 November 2002
PARTIES :	PAUL FRANCIS PATRICK WHELAN (First Applicant) COLLEEN WHELAN (Second Applicant) v JOHN FAIRFAX PUBLICATIONS Pty Ltd (First Respondent) DARREN GOODSIR (Second Respondent) HEATH GILMORE (Third Respondent)
JUDGMENT OF:	Levine J at 1

COUNSEL :	R McColl SC / P Gray (Paintiffs) S D Rares SC/ A Leopold (Defendants)
SOLICITORS:	Jones & Staff (Plaintiffs) Freehills (Defendants)
CATCHWORDS:	Justification - contextual imputations - Polly Peck - partial justification - common sting
LEGISLATION CITED:	Defamation Act 1974
CASES CITED:	Agar v Hyde (2000) 201 CLR 552 Allen v John Fairfax & Sons Ltd, unreported, NSWSC, Hunt J, 2 December 1988 Amalgamated Television Services Pty Ltd v Marsden [1998] 43 NSWLR 158 Bank of NZ v Spedley Securities Ltd (In Liq) (1992) 27 NSWLR 91 Carrey v ACP Publishing Pty Ltd [1999] 1 VR 875 Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 Clarke v Taylor & Anor ((1836) 2 Bing (N C) 654 Curran v Herald and Weekly Times, unreported, Supreme Court of Victoria, 28 September 1993 David Syme & Co Ltd v Hore-Lacy [2000] 1 VR 667 David Syme & Co Ltd & Anor v Hore-Lacy [2000] VSCA 24 Dunsec Pty Ltd v Nationwide News Ltd [2000] NSWCA 155 Edwards v Bell (1825) 1 Bing 403 at 409 Farquhar v Bottom [1980] 2 NSWLR 380 Goody v Odhams Press Ltd [1967] 1 QB 337 Grundmann v Georgeson (1996) Aust Torts Rep 63,500 Gumina v Williams (No 2) [1990] 3 WAR 351 Harb v Illawarra Newspapers Holdings Pty Ltd, unreported, Levine J, 10 November 1995 Hart v Wrenn (1995) 5 NTLR 17 Hepburn v TCN Channel Nine Pty Ltd [1984] 1 NSWLR 386 Hore-Lacy v David Syme & Co Ltd [1998] VSC 96 Jackson v John Fairfax & Sons Ltd [1981] 1 NSWLR 36 John Fairfax Publications Pty Ltd v Blake; David Syme & Co Ltd v Blake (2001) 53 NSWLR 541 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 Jones v Skelton (1963) 63 SRNSW 644 Keating v Newcastle Newspapers Pty Ltd (No 2) [2001] NSWSC 106 Kelly v Special Broadcasting Service [1999] VR 69 Kennett v Farmer [1988] VR 991 Lewis v Daily Telegraph [1964] AC 234 Lucas-Box v News Group Newspapers Ltd [1986] 1 WLR 147 McBride v Australian Broadcasting Corporation [2000] NSWSC 747 Marsden v Amalgamated Television Services Pty Ltd [2001] NSWSC 510 Pamplin v Express Newspapers Ltd [1988] 1 WLR 116 Plato Films Ltd v Spiedel [1961] AC 1090 Polly Peck (Holdings) PLC and Ors v Trelford & Ors [1986] QB 1000 Prager v Times Newspapers Ltd [1998] 1 WLR 77 Random House Australia Pty Ltd v Abbott (1999) 94 FCR 296 Rantzen v Mirror Group Newspapers Ltd [1994] QB 670 Rigby v John Fairfax Group Pty Ltd, unreported, NSWCA, 1 February 1996 Robinson v Laws [2001] QCA 122 Sutherland v Stopes [1925] AC 47 Sydney Refractive Surgery & 3 Ors v Beaumont & 2 Ors [2002] NSWSC 638 TCN Channel Nine Pty Ltd v Antoniadis (1998) 44 NSWLR 682 TWT Ltd v Moore (1991) A Def Rep 51,030 Wallace v Wallace [2001] WASC 134 Wickstead v Browne (1992) 30 NSWLR 1 Woodger v Federal Capital Press of Australia Pty Ltd (1992) 107 ACTR 1
DECISION:	See paragraph 108