Cromwells Auctions and Appraisers Pty Limited v John Fairfax Publications Pty Limited [2002] NSWSC 948

New South Wales Supreme Court

CITATION : Cromwells Auctions and Appraisers Pty Limited v John Fairfax Publications Pty Limited [2002] NSWSC 948 CURRENT JURISDICTION: Common Law Division FILE NUMBER(S) : SC 20443/02 HEARING DATE(S) : 4 October 2002 JUDGMENT DATE : 4 October 2002

PARTIES : Cromwells Auctions and Appraisers Pty Limited (Plaintiff) John Fairfax Publications Pty Limited (Defendant) JUDGMENT OF : Dunford J

COUNSEL : C Evatt (Plaintiff) TD Blackburn (Defendant) SOLICITORS : Monte Gildea Lawyer (Plaintiff) Freehills Solicitors (Defendant) CATCHWORDS : DEFAMATION - Application for interlocutory injunction - Alternative claim for injurious falsehood. CASES CITED : Church of Scientology of California Incorporated v Reader's Digest Services Pty Limited [1980] 1 NSWLR 344 Chappel v TCN 9 Pty Limited (1988) 14 NSWLR 153 DECISION : Injunction refused. Summons dismissed.

- IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

DUNFORD J

Friday, 4 OCTOBER 2002

M0001/02 Cromwell's Auctions and Appraisers Pty Limited v John Fairfax Publications Pty Limited

JUDGMENT – re application for interlocutory injunction to restrain publication of material 1 HIS HONOUR: This is an application by Cromwells Auctions and Appraisers Pty Limited for an interlocutory injunction to restrain the publication of material containing the imputations set out in paras 1(a) to (e) of the Summons, or containing what are alleged to be injurious falsehoods, apparently to the same general effect. The draft of the proposed article is Ex. A and, without doing justice to such draft, it refers in some detail to the plaintiff company and the fact that the director of the plaintiff company is James Byrnes and some of Mr Byrnes' past business history is referred to. 2 The plaintiff company has purchased, pursuant to a Deed of Company Arrangement, an auction business formerly conducted by Wemyss Pty Limited ("Wemyss"), a company which became insolvent, and the proposed article refers to some of the circumstances of that and the fact that a number of persons and companies lost money when Wemyss became insolvent, including, as I understand it, a number of vendors who had sold items through the auctions conducted by that company. The evidence that has been given before me indicates that a number of persons active in Wemyss are now active in the plaintiff's business. 3 Putting those facts together, including that so far, at any rate, the plaintiff company does not have a vendor's trust account, the proposed article suggests inferentially that the plaintiff company may become insolvent and creditors, including vendors, may not get paid. As I say, this does not do justice to the proposed article and is a very rough and ready summary of its general nature. 4 The principles on which injunctions to restrain the publication of allegedly defamatory material will be granted have been summarised in a number of cases, but conveniently in Church of Scientology of California Incorporated v Reader's Digest Services Pty Limited [1980] 1 NSWLR 344 at 349-50, and it is not necessary to repeat them again. They were reaffirmed in Chappel v TCN 9 Pty Limited (1988) 14 NSWLR 153, subject to the qualification that, where the defendant indicates it will seek to prove justification, it must also establish that the material relates to a matter of public interest or is published under qualified privilege. The Church of Scientology case is also authority for the proposition at 350-1 that the principles relating to interlocutory injunctions in defamation proceedings cannot be avoided by framing the plaintiff's case, not in defamation, but in injurious falsehood or otherwise; and an injunction will not be granted in other cases where it would have the same effect as an injunction which would not have been granted if the claim had been in defamation. 5 In the present case there is an affidavit from the defendant's solicitor which indicates that if a claim for damages in defamation is made based on the imputations set out in the summons, it proposes to rely on the defences of justification and/or comment and/or qualified privilege. On the limited material presently available, it cannot be said that none of these defences could possibly succeed. 6 In relation to the claim for injurious falsehood, it is necessary for the plaintiff to establish that the proposed article contains statements that are false, that the publication would be malicious, that is, as I understand it in the present context, that it would be for an improper motivation and thirdly, that there would be a likelihood of damage. I can accept for present purposes there may be a likelihood of damage, but I am not satisfied, again on the limited material available, that any of the statements are false or that the material is published for an improper purpose, if one accepts the possibility that the motivation for the publication is to place the material before members of the public who may wish to be better informed as to the prospects of being paid if they sell goods through the plaintiff's auctions. 7 It may be that at a final hearing the plaintiff would succeed on one or other of its causes of action, but the position is not so clear, in my view, as to justify an injunction at this stage, bearing in mind the countervailing interest that the community has in freedom of the press. Accordingly, I order the application for an injunction and the summons be dismissed with costs. **********