New South Wales Supreme Court CITATION : Assaf v Skalkos [1999] NSWSC 1329 CURRENT JURISDICTION : Common Law Division FILE NUMBER(S) : 18374/99 HEARING DATE(S) : 01/11/99-17/12/99 JUDGMENT DATE : 1 December 1999 PARTIES : Joseph Assaf & Anor v Theodore Skalkos & Anor JUDGMENT OF : Carruthers AJ at 1 COUNSEL : T E F Hughes QC/K Rees (Plaintiffs) S M Littlemore QC/J R McKenzie (Defendants) SOLICITORS : Mallesons Stephen Jaques (Plaintiffs) T Lazaropoulos (Defendants) CATCHWORDS : Defamation - evidence - whether business record is, in the circumstances, admissible pursuant to s69(2) of the Evidence Act, 1995 in the absence of the author as a witness - if admissible whether unfairly prejudicial. ACTS CITED : Evidence Act 1995 DECISION : See para 17 and 18. THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION CARRUTHERS AJ Wednesday, 1 December 1999 CLD18374/93 Joseph ASSAF & ANOR v Theodore SKALKOS & ANOR EX TEMPORE JUDGMENT - On admissibility of MFI 15; see page 1373 1 HIS HONOUR: It is necessary for me to rule upon the admissibility in the defendants' case of the document marked for identification 15. This is a letter on the letterhead of the Australian Chinese Newspapers Pty Limited. It is under the hand of James Mok, advertising manager. It is dated 26 June 1995 and is addressed to Mr Adam Baxter, Manager, Multi-Cultural Affairs, Telecom Australia, Melbourne. It is a short letter and it is convenient to set it out here: "Dear Mr Baxter, We write to express our concern that we have been required to pay a commission of 20% to your Agent, Ethnic Communications, in order to receive Telecom advertising in our Newspaper. This commission we have paid reluctantly but the position has now arisen where they are calling for increased commissions to be paid which we can ill afford. We do not wish to lose Telecom advertising but consider this matter to be most intimidating and call upon your assistance. Yours sincerely James Mok, Advertising Manager. c.c. Mr Colin Harvey." 2 When dealing with questions of validity of particulars of truth on 5 February 1998, David Levine J approved a particular, broadly in the terms that the Chinese Daily Newspaper Advertising Manager was intimidated by ETCOM in relation to Telecom advertising in that newspaper. The letter was discovered, as part of the discovery process, by the solicitors for the plaintiffs. How the document came into their possession it is not known. It was first referred to in the evidence in this case on 9 November 1999 during the course of cross-examination by Mr Littlemore for the defendants of Mr Assaf. A number of questions were put to the witness in relation to this letter, starting at transcript 444. It is fair to say that each of the questions was the subject of objection by Mr Hughes for the plaintiffs, but rulings by me allowed the following evidence, at transcript p445: "Q. You knew the Australian Chinese Daily complained to Telstra that you were demanding 20 per cent on Telstra advertising which they could not afford? A. I knew the Australian Chinese Daily wrote to Telstra and asked for what Telstra asked them (sic). Q. You knew they considered your attitude to be intimidatory, didn't you? A. No, I didn't know that. I know they wrote to Telstra and told them what they considered. Q. Have you seen the letter? A. I have seen the letter." 3 There was further objection. Mr Littlemore called for the letter in question and sought access to it. It was produced by Mr Hughes and access was granted. The document was marked for identification 15. Mr Littlemore said (at transcript 446) by way of a question: "Q. I show you both documents (mfi 15 and copy thereof). You told the jury that the Chinese Daily did not complain that they found your conduct intimidating, didn't you? You did say that, didn't you? A. I still say because I know what came after when the client wrote to the Chinese Daily and they confessed they did it without any knowledge of any intimidation." 4 Mr Littlemore asked the witness to look at the letter. Mr Hughes objected and submitted it was inadmissible. I allowed the witness to be shown the letter. Mr Littlemore said (at transcript 447): "Q. Please read it out? A. 'We don't wish to lose Telecom advertising but consider this matter to be most intimidatory and call upon your assistance'. Q. I put it to you that the conduct of which the Australian Chinese Daily complained was typical of your conduct towards the ethnic newspapers that would not agree to your rate for the Aged Pension News in 1992." 5 That question was withdrawn and the following question was put: "Q. I put it to you a complaint was made by the Australian Chinese Daily and was a truthful one. What do you say? A. It was not truthful. Q. I put it to you they were in fact intimidated by your conduct as they said in the letter? A. They said they were not." 6 I then asked the witness would he answer "yes" or "no". There must have been some statement to attract my intervention which is not recorded on the transcript. In any event, the witness said, "No, it was not intimidating." 7 There the matter remained until the close of the oral evidence when Mr Littlemore, sought to tender the letter, mfi 15, submitting that it fell within the terms of s69 of the Evidence Act 1995, which deals with exception to the hearsay rule enshrined in business records that comply with the terms of the section. I have no difficulty accepting the submission that, prima facie, the document on its face constitutes a business record. However, I do have difficulties with subs (2) of s69, which provides that: "The hearsay rule does not apply to the document (so far as it contains the representation) if the representation was made: (a) by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact, or (b) on the basis of information directly or indirectly supplied by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact." 8 The crucial "asserted fact" here is to be found in the final paragraph of the letter: "We do not wish to lose Telecom advertising but consider this matter to be most intimidating and call upon your assistance." 9 It is significant that the personal pronoun "we" is used throughout this letter, which, I reiterate, was signed by the advertising manager. No doubt he had authority so far as advertising within the newspaper was concerned, subject to directions from superior officers, whoever they might be, and certainly the Board. 10 For the purposes of subs(2), it cannot in my view be overlooked that this letter purports on the face of it, one might reasonably accept, to be written on behalf of the company, as distinct solely from expressing the view of Mr Mok or containing the representation of Mr Mok. Bearing in mind its importance, I would not be prepared to construe it for present purposes, so that the question of admissibility need only be resolved by reference to the letter being a view of, or a representation by Mr Mok. Whether or not he had authority to speak on behalf of others is not known, other than what is contained in the letter itself, and I would not be prepared in the light of the evidence relating to the letter to draw that inference. 11 I have very grave doubts, therefore, whether the letter falls within the terms of subs (2) of s69, so as to exclude the operation of the hearsay rule. However, there is another extremely significant aspect to this, and that is that no evidence has been put before the jury as to the availability or non-availability of the author of this letter, Mr Mok. One must bear in mind that this letter is relied upon as part of the defence of justification to the "bullying" imputation. It must, therefore, go to the question of whether the defendants have established that that imputation is substantially true. 12 The fact that Mr Mok was not called and no evidence is before the jury as to why he was not called means that the plaintiffs are in the position that if this letter goes before the jury as evidence of the truth, they cannot evaluate the reliability of the evidence, insofar as it is evidence of the truth, except by reference to Mr Assaf's denials. 13 It was submitted by Mr Littlemore that the defendants are entitled to rely upon the wording of the provisions of s69, and that this letter falls within the provisions of subs (2). That leaves the plaintiffs in the position, he submitted, that if they wish to challenge the correctness of the letter then the obligation is upon them to call Mr Mok, or, presumably, to lead evidence as to why he could not be called. 14 I find it extraordinarily difficult to accept that the revolutionary provisions in the Evidence Act, so far as hearsay evidence is concerned, were ever intended to result in a situation such as that. If Mr Mok were called by the plaintiffs he could be cross-examined by counsel for the defendants on this particular letter. 15 It seems to me, from my reading of the Report and various cases since the Act was enacted that one reason for the inclusion in the Act of s135 and other discretionary and mandatory provisions in Pt 3.11 is to provide courts with the remedy of being able to mitigate the effects of provisions such as the hearsay provisions which have found their way into the Act. I acknowledge absolutely, as Mr Littlemore has put to me, that the phrase "unfairly prejudicial" in paragraph (a) of section 135 means evidence which is unfairly prejudicial in the sense that it means more than evidence which is prejudicial in the sense that it is evidence adverse to a party. It must demonstrate actual prejudice to the party which could operate, despite the general rules of evidence in the provisions in the Act, in a distinctly prejudicial way to a party. 16 For the reasons which I have briefly outlined, if this letter in the present state of the evidence were to go before the jury, even allowing for the fact that it is already before them by way of the cross-examination of Mr Assaf, it could unquestionably, in my view, operate to the prejudice of the plaintiffs. The jury would have the letter before them with no countervailing evidence other than the denials by Mr Assaf in cross-examination. 17 In summary, therefore, I am of the view, for the reasons set out, that the letter, by reason of its tending on the face of it to speak on behalf of the company as a whole which would embrace presumably or possibly the Board as well as superior officers to the Advertising Manager, does not fall within the terms of subs(2) of s69. However, if I am wrong in that view and the letter does correctly fall within the provisions of subs(2), I am firmly of the view that the situation falls within the terms of s135(a) of the Act, and would reject it on that discretionary basis. 18 Accordingly MFI 15 is rejected. Last Modified: 04/18/2001 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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