Court of Appeal Supreme Court New South Wales Medium Neutral Citation: The Korean Times Pty Ltd & Anor v Un Dok Pak [2011] NSWCA 365 Hearing dates: 28.09.11, 29.09.11 Decision date: 30 November 2011 Before: Beazley JA at 1; Basten JA at 2; Nicholas J at 43 Decision: Allow the appeal in part and set aside order 1 made in the District Court on 19 November 2010. In lieu of the judgment in the District Court, give judgment for the plaintiff against the defendants in the amount of $82,810, such judgment to take effect from 19 November 2010. Otherwise dismiss the appeal. Order the appellants to pay 80% of the respondent's costs in this Court. [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.] Catchwords: DEFAMATION - whether imputations conveyed by the matter complained of - DEFAMATION - defence of common law qualified privilege - publication in Korean language newspaper - whether reciprocity of interest or duty established - DAMAGES - aggravated damages - whether malice a relevant factor - whether failure to apologise attracted justified award of damages - reassessment of award Legislation Cited: Defamation Act 2005 ss 25, 28, 30, 34, 35, 36, 37 Cases Cited: Adam v Ward [1917] AC 309 Ali v Nationwide News Pty Ltd [2008] NSWCA 183 Aktas v Westpac Banking Corporation [2010] HCA 25; (2010) 241 CLR 79 Assaf v Skalkos [2000] NSWSC 418 Austin v Mirror Newspapers Ltd (1985) 3 NSWLR 354 Andreyevich v Kosovich (1947) 47 SR(NSW) 357 Bashford v Information Australia (Newsletters) Pty Ltd [2004] HCA 5; (2004) 218 CLR 366 Bennette v Cohen [2009] NSWCA 60 Bickel v John Fairfax & Sons Ltd [1981] 2 NSWLR 474 Braddock v Bevins [1948] 1 KB 580 Cassell & Co Ltd v Broome [1972] AC 1027 Cush v Dillon; Boland v Dillon [2011] HCA 30; 85 ALJR 865 Guise v Kouvelis (1947) 74 CLR 102 John Fairfax Publications Pty Ltd v Rivkin [2003] HCA 50; (2003) 77 ALJR 1657 Lang v Willis [1934] HCA 51; (1934) 52 CLR 637 Lange v Australian Broadcasting Corporation [1997] HCA 25; 189 CLR 520 Ley v Hamilton (1935) 153 LT 384 Loveday v Sun Newspapers Ltd [1938] HCA 28; (1938) 59 CLR 503 Morosi v Mirror Newspapers [1977] 2 NSWLR 749 Rigby v Associated Newspapers [1969] 1 NSWR 729 Robbie Waterhouse v The Age Company Ltd & Ors [2011] NSWSC 159 Roberts v Bass [2002] HCA 57; (2002) 212 CLR 1 Rogers v Nationwide News Pty Ltd [2003] HCA 52; (2003) 216 CLR 327 Skalkos v Assaf [2002] NSWCA 14; (2002) Aust Torts Rep 81-644 Stephens v West Australian Newspapers Ltd [1994] HCA 45;(1994-1995) 182 CLR 211 Toogood v Spyring (1834) 1 Cr M & R 181; 149 ER 1044 Trad v Harbour Radio Pty Ltd [2011] NSWCA 61; (2011) 279 ALR 183 Theophanous v The Herald & Weekly Times Ltd [1994] HCA 46; (1994) 182 CLR 104 Triggell v Pheeney (1951) 82 CLR 497 Waterhouse v Broadcasting Station 2GB Pty Ltd (1985) 1 NSWLR 58 Texts Cited: T Blackshield and G Williams, Australian Constitutional Law and Theory (4th ed, Federation Press, 2006) Category: Principal judgment Parties: The Korean Times Pty Ltd - first appellant Mr Joshua Nam - second appellant Ms Un Dok Pak - respondent Representation: Counsel: T D Blackburn SC/J O Hmelnitsky - appellants C A Evatt/R Rasmussen - respondent Solicitors: Addisons - appellants John Doolan - respondent File Number(s): 10/414711 Decision under appeal Citation: Un Dok Pak v The Korean Times Pty Ltd Date of Decision: 2010-11-19 00:00:00 Before: Rolfe J File Number(s): 09/336545 Judgment 1BEAZLEY JA: I agree with Nicholas J. 2BASTEN JA: The appellants are the publishers of a Korean language newspaper circulating primarily in New South Wales. On 27 February 2009, the appellants published an article which the respondent, Ms Un Dok Pak, claimed defamed her. She commenced proceedings for defamation in the District Court. 3The respondent identified in her pleadings four imputations conveyed by the article (omitting references): "(a) The Plaintiff is being investigated by the Independent Commission Against Corruption for a political donation to Judge MP, the Minister for Fair Trading and Citizenship. (b) The Plaintiff was suspected by the Independent Commission Against Corruption of improper conduct. (c) The Plaintiff is suspected by the Independent Commission Against Corruption of soliciting Judge MP to use her influence to have the Plaintiff appointed President of the Community Relations Commission. (d) The Plaintiff has so conducted herself by making a political donation to Judge MP the Minister for Fair Trading and Citizenship that she warranted investigation by the Independent Commission Against Corruption." 4The trial was heard by Rolfe DCJ, who delivered judgment on 19 November 2010. His Honour upheld the claims made by the respondent and awarded her damages of $100,000, plus interest in the sum of $3,600. 5The appellants challenged the judgment and orders in the District Court on the following grounds: (1) and (2) None of the imputations was conveyed. (3) Imputations (a) and (d), if conveyed, were not defamatory. (4) The matter complained was published on an occasion of qualified privilege, at common law. (5) The finding that the appellants acted with malice was erroneous. (6) and (7) The assessment of damages was erroneous. (8) The award of costs on an indemnity basis was erroneous. Grounds 3 and 8 were abandoned in the course of the hearing of the appeal. In respect of grounds 1 and 2 (imputations not conveyed) the appeal must fail for the reasons given by Nicholas J. 6In respect of ground 4, I agree with his Honour's reasons for upholding the decision of the trial judge that no defence of qualified privilege at common law was available to the appellants, but add some reasons of my own for reaching that conclusion. 7In respect of ground 5, the findings of the trial judge with respect to malice were unnecessary, given the unavailability of the qualified privilege defence. As I would uphold the conclusion of the trial judge in respect of qualified privilege, it is also unnecessary for me to address that matter. 8In relation to grounds 6 and 7 concerning damages, I agree with Nicholas J that, on the evidence, his Honour was in error in including in his assessment of damages an amount by way of aggravated damages and by relying upon the findings as to the malice of the appellants. For the reasons given by Nicholas J, I agree that damages should be reassessed by this Court in an amount of $80,000, plus interest. 9Accordingly, I agree with the orders proposed by Nicholas J. Common law qualified privilege 10The publisher of a statement which is both defamatory and untrue may obtain protection from the civil consequences of the publication if the "occasion" of the publication is one warranting such protection. In the somewhat archaic language of Toogood v Spyring (1834) 149 ER 1044 at 1049-1050, the privilege is said to arise in respect of publications "fairly made by a person in the discharge of some public or private duty, whether legal or moral, or in the conduct of his [or her] own affairs, in matters where his [or her] interest is concerned". The respective concepts of duty and interest identify a relationship between the publisher and the recipient of the publication. Underlying the concepts of duty and interest are the purposes which permit the protection to be afforded. Abuse of the occasion by pursuit of an extraneous purpose will take the publication outside the scope of the protection. 11It is well established that "the defence of qualified privilege is generally not available where defamatory matter is published in a newspaper": Stephens v West Australian Newspapers Ltd [1994] HCA 45; 182 CLR 211 at 260 (McHugh J). To similar effect, the Full High Court stated in Lange v Australian Broadcasting Corporation [1997] HCA 25; 189 CLR 520 at 570, "[o]nly in exceptional cases has the common law recognised an interest or duty to publish defamatory matter to the general public". 12Two exceptions were identified by McHugh J in Stephens at 262-263. His Honour noted that cases such as Adam v Ward [1917] AC 309 and Loveday v Sun Newspapers Ltd [1938] HCA 28; 59 CLR 503 concerned "publications in reply to attacks on the plaintiff or some other person which had been published to the world at large": see also Trad v Harbour Radio Pty Ltd [2011] NSWCA 61. 13Secondly, McHugh J noted there were cases demonstrating that "the proprietor of a newspaper or a radio or television station is entitled to a defence of qualified privilege when it publishes statements made by a third person pursuant to or in discharge of that person's interest or duty to inform the general public about a matter": at 263. It was accepted by the appellants, however, that they could not rely upon such exceptions. 14Rather, they relied upon the proposition, derived from Lange , "that each member of the Australian community has an interest in disseminating and receiving information, opinions and arguments concerning government and political matters that affect the people of Australia": at p 571. The Court continued: "The duty to disseminate such information is simply the correlative of the interest in receiving it. The common convenience and welfare of Australian society are advanced by discussion - the giving and receiving of information - about government and political matters. The interest that each member of the Australian community has in such a discussion extends the categories of qualified privilege. Consequently, those categories now must be recognised as protecting a communication made to the public on a government or political matter." 15Lange held that "discussion of government or politics at State or Territory level and even at local government level is amenable to protection by the extended category of qualified privilege, whether or not it bears on matters at the federal level": ibid. 16Precisely how the appellants sought to rely upon the reasoning in Lange was somewhat unclear. The expanded doctrine of qualified privilege did not provide secure protection given "honesty of purpose" or absence of malice or abuse of the privilege. Rather, the Court held that "reasonableness of conduct seems the appropriate criterion to apply when the occasion of the publication of defamatory matter is said to be an occasion of qualified privilege solely by reason of the relevance of the matter published to the discussion of government or political matters": at p 573. The Court continued: "But reasonableness of conduct is imported as an element only when the extended category of qualified privilege is invoked to protect a publication that would otherwise be held to have been made to too wide an audience." 17Although originally the appellants pleaded both common law qualified privilege and the expanded doctrine available under Lange , the trial judge rejected the assertion that the appellants had acted reasonably, a conclusion not challenged in this Court. 18On a conventional understanding, the appellants' reliance on qualified privilege was doomed to fail because they could invoke neither the traditional doctrine under the general law, nor the expanded doctrine under Lange . They failed on the first count because they published to the public at large in a newspaper; they failed on the second count because their conduct was not reasonable. To avoid that result, they sought to construct a third category. 19For reasons which will be explained, there is no third category; nevertheless, it is appropriate to start by identifying the features relied upon by the appellants to identify their entitlement. Although differently formulated at different times, the substance of their case was that they had a duty in the following circumstances: (a) to convey information about government or political matters; (b) to a confined segment of the community with a particular interest in the topic; (c) which segment lacked the ability to obtain such information from other sources. 20Flesh was put on this skeleton in the following manner. The particular subject matter of the publication was identified as allegations contained in the mainstream media which shamed, or lowered the image of, the Korean community in Australia. The particular segment of the community to which such information was addressed was the non-English speaking segment, which relied upon communications in the Korean language. Those people were, thus, unable to obtain such information directly from the mainstream media. 21The appellants' position contained a number of factual elements which were certainly not explored in submissions before the trial judge: indeed, it is doubtful whether relevant findings could be made on the evidence presented at trial. However, it is convenient to assume that the case thus presented was made out on the facts in order to test its legal validity. 22The idea that there was some third category of occasion of qualified privilege was said to derive from the manner in which the High Court reasoned to its conclusion in Lange . Thus reliance was placed on the broad statement of McHugh J in Stephens at 264 (set out in Lange at 570-571) which reads in part as follows: "In the last decade of the twentieth century, the quality of life and the freedom of the ordinary individual in Australia are highly dependent on the exercise of functions and powers vested in public representatives and officials by a vast legal and bureaucratic apparatus funded by public moneys. ... Information concerning the exercise of those functions and powers is of vital concern to the community. So is the performance of the public representatives and officials who are invested with them. It follows in my opinion that the general public has a legitimate interest in receiving information concerning matters relevant to the exercise of public functions and powers vested in public representatives and officials. ... With the increasing integration of the social, economic and political life of Australia, it is difficult to contend that the exercise or failure to exercise public functions or powers at any particular level of government or administration, or in any part of the country, is not of relevant interest to the public of Australia generally." 23This being the foundation upon which the expanded category of qualified privilege was based, the expansion was accepted, it was submitted, quite independently of the limiting condition, namely that the conduct of publication must be reasonable. That condition was based on a different consideration, namely the consequence of expanding the area of operation of the defence. Thus, the Court in Lange stated at 572: "Because privileged occasions are ordinarily occasions of limited publication - more often than not occasions of publication to a single person - the common law has seen honesty of purpose in the publisher as the appropriate protection for individual reputation. ... But a test devised for situations where usually only one person receives the publication is unlikely to be appropriate when the publication is to tens of thousands, or more, of readers, listeners or viewers." 24In the present case, the appellants argued, the publication was made to some 6,000 readers (being the weekly circulation figure in New South Wales) or possibly some 12,000 readers on the basis of 2 readers per copy distributed. This, the appellants argued, was a far cry from the underlying concern which led to the imposition of a "reasonableness" condition in respect of the expanded category. The Court was entitled, so the submission appeared to continue, to take into account the factors referred to above to permit a defendant to avail itself of the defence of qualified privilege, subject only to the limitations applicable under traditional general law principles, where the potential damage attending the full expanded category did not operate. 25The proposed approach is not consistent with the express reasoning in Lange , nor with a proper understanding of the historical developments of the expanded doctrine in Lange : each of these matters must be addressed briefly. 26The purpose of the expanded doctrine was to ensure that the common law rules of qualified privilege would "properly reflect the requirements of ss 7, 24, 64, 128 and related sections of the Constitution": at 571. The Court continued at 572: "Thus, the extended category of common law qualified privilege ensures conformity with the requirements of the Constitution. The real question is as to the conditions upon which this extended category of common law qualified privilege should depend." 27This language is inconsistent with any suggestion that the expanded doctrine and the limiting condition can be decoupled so that, in some circumstances, the expanded doctrine can be invoked without the limiting condition. Nor can the rationale, referring to publication to "tens of thousands, or more" be read as excluding publications which refer, for example, to less than 10,000 readers. The Court expressly stated at 573: "Reasonableness of conduct is an element for the judge to consider only when a publication concerning a government or political matter is made in circumstances that, under the English common law, would have failed to attract a defence of qualified privilege." 28The reference to reasonableness applying "only when" the traditional category was not available is not to be read as meaning "only when, and then only sometimes when". The language of the judgment requires that, if the appellants need to rely upon the expanded doctrine, they are subject to the condition of reasonableness. 29Secondly, some brief reference should be made to the history behind the judgment in Lange . In the previous decade, the Court had divided over whether there was an implied constitutional freedom of political communication which itself imposed a limit on the law of defamation: see generally, T Blackshield and G Williams, Australian Constitutional Law and Theory (4 th ed, Federation Press, 2006) at pp 1306-1319. In Stephens , at 259, McHugh J repeated the view he had articulated in Theophanous v The Herald & Weekly Times Ltd [1994] HCA 46; 182 CLR 104 "for concluding that the Commonwealth Constitution contains no guarantee of freedom of expression that would render the defendant immune from an action for defamation". In Lange , those members of the Court who had favoured both a constitutional immunity and an expansion of the existing common law defence united in support of the latter approach. That approach may have expanded the degree of protection accorded to publishers of defamatory material beyond a constitutional immunity: Lange at 571. 30The reasoning underlying the principle established in Lange , and further developed in relation to electioneering material in Roberts v Bass [2002] HCA 57; 212 CLR 1, demonstrates that there is no room for some third category of cases, limited only by a requirement of honesty of purpose. 31There are a number of other aspects of Lange which may be noted for present purposes. First, although Lange referred to the electioneering case, Lang v Willis [1934] HCA 51; 52 CLR 637, it was not directly concerned with electioneering material: see Roberts v Bass at [4]-[7] (Gleeson CJ) and [72]-[73] (Gaudron, McHugh and Gummow JJ); [161] and [167] (Kirby J); see also Braddock v Bevins [1948] 1 KB 580. 32Secondly, the test of reasonableness provides a flexible standard, the application of which will depend upon the circumstances of the particular case. Because the appellants did not seek to bring themselves within the scope of the expanded doctrine, there is no occasion to consider that aspect further in this case. 33Thirdly, there may be cases, like the present one and Roberts v Bass , where a defendant whose publication appears to fall squarely within the scope of the expanded doctrine, seeks to rely upon the traditional scope of the defence, thus avoiding the need to prove the reasonableness of their conduct. That there may be an area of overlap, does not, however, demonstrate that there is a third category, involving an extension of the conventional area, but governed only by an exclusion for malice or abuse of purpose. 34The issue presently raised by the appellants is not novel in this jurisdiction. In Andreyevich v Kosovich (1947) SR (NSW) 357, the Full Court considered a similar claim by the publisher of a Croation language newspaper in Sydney, having a circulation less than that of the appellants' newspaper. Jordan CJ noted that "the newspaper was intelligible only to a relatively narrow group, and the question was whether its particular contents could with propriety be communicated to that group": p 365. Nevertheless, the defence was held to be properly rejected, the Chief Justice stating at 364: "It is true that in the case now before us the defamation of the plaintiff occurred in time of war, and that this would naturally exacerbate the feelings of Yugoslavs settled in Australia who took opposite views as to the relative merits of two antagonistic guerrilla leaders operating in Yugoslavia. But I cannot see that it was expedient, for the common convenience and welfare of the people of New South Wales, in the conditions then existing, that Yugoslavs that had made this State their home should be privileged to abuse one another within impunity because they disagreed upon those relative merits, and that one group or the other should be entitled to publish its calumnies broadcast among Yugoslavs resident here. So long as the contestants were content to express themselves in general terms no question of defamation arose; but when the defendants in their newspaper article condescended to attack particular individuals they became in my opinion subject to the general law of defamation, outside the pale of privilege." 35An appeal to the High Court was apparently dismissed, although no published version of the judgment is available: 73 CLR 665 (note) (the name of the appellant being misspelt); see Aktas v Westpac Banking Corporation Ltd [2010] HCA 25; 241 CLR 79 at [31]. The law as it stood before the constitutional developments in the 1990s, was explored comprehensively by this Court in Morosi v Mirror Newspapers Ltd [1977] 2 NSWLR 749 at 772E-790A, by Moffitt P, Hope and Reynolds JJA. Their Honours stated at 778: "It is apparent from these decisions and dicta that, at common law, a publication in a newspaper is not the subject of qualified privilege merely because it gives the public information concerning a matter in respect of which the public is interested. Something more is needed which is said in some circumstances to constitute a duty, and in other circumstances an interest, on the part of the newspaper to communicate the information." 36More recently, Assaf v Skalkos [2000] NSWSC 418 (Carruthers AJ) involved defamatory statements contained in two publications, one being a letter addressed to the Prime Minister and the other a publication of the letter in a Serbian language newspaper, Novosti . Novosti had a similar circulation to that of The Korean Times and was described as "a special interest publication for a small section of the public, and not the public at large": at [53]. It was further contended that the Serbian community had an interest in having "information on the provision for themselves of vital government information on their rights, entitlements and obligations" which interest was said to justify publication of statements made by the defendant (Mr Skalkos) in his letter to the Prime Minister. 37Carruthers AJ referred to the passage in the judgment of McHugh J in Stephens which envisaged an extension of the occasions of qualified privilege "to protect communications made to the general public by persons with special knowledge concerning the exercise of public functions or powers or the performance of their duties by public representatives or officials invested with those functions and powers": at [200]. He concluded that Mr Skalkos was a person with such "special knowledge" and that, subject to the publication being made honestly for a legitimate purpose, the defence extended to the republication of the letter in the newspaper. Nevertheless, his Honour was satisfied that the defendants had abused the occasion of privilege and rejected the defence: at [205]. 38The case came before this Court on appeal: Skalkos v Assaf [2002] NSWCA 14; (2002) Aust Torts Rep 81-644. Because Carruthers AJ held in favour of the defendant that there was an occasion for invoking the defence of qualified privilege for the newspaper, absent a notice of contention, the correctness of this approach was not in issue on the appeal. There was, apparently, no notice of contention. Accordingly, this Court was not called upon to review that conclusion. Mason P referred to the pleading of the defence of common law qualified privilege in respect of the newspaper publication, noted the finding of the primary judge that there was an occasion of privilege and stated that the finding was not challenged on appeal, referring to Lange at 571, presumably by way of explanation of the absence of challenge: at [21]. Care must be taken, however, in reading too much into a statement made in the course of noting that an issue was not in dispute. For example, the passage from McHugh J in Stephens relied upon in Lange at 570-571 did not adopt the reference to "persons with special knowledge" having a duty to communicate, which was the phrase relied upon by Carruthers AJ. Further, Lange imposed a reasonableness requirement in relation to the extended category which was not applied in Skalkos , although it would almost certainly not have been satisfied on the findings of fact. 39Giles JA in Skalkos also referred to the finding, doubting that the case involved a person with special knowledge in the sense described in Stephens : at [128]. Fitzgerald AJA did not refer to the point. 40For the reasons noted above, it appears that Carruthers AJ did not apply Lange . (Had he done so, the outcome would have been the same.) It is clear, however, that Assaf v Skalkos is inconsistent with the proposition that publication by a newspaper in circumstances not dissimilar to the present case, will give rise to an occasion of qualified privilege under the general law, putting Lange to one side. Carruthers AJ expressly relied upon the extended doctrine as identified by McHugh J in Stephens to find such an occasion. 41Much may depend upon the application of the flexible condition of reasonableness or, in respect of more restricted publications, honesty of purpose and malice. However, there is no authority for the proposition articulated by the appellants, that the established rules with respect to publication by newspapers and other media outlets have been varied as a result of recent decisions of the High Court. The language of Lange is inconsistent with such a conclusion, as are the continuing references to traditional statements of the law, such as Andreyevich , referred to with apparent approval, albeit in a somewhat different context, in Aktas at [31] (French CJ, Gummow and Hayne JJ) and in Cush v Dillon; Boland v Dillon [2011] HCA 30; 85 ALJR 865, at [40] (Gummow, Hayne and Bell JJ), adopting a reference in the judgment of McHugh J in Bashford v Information Australia (Newsletters) Pty Ltd [2004] HCA 5; 218 CLR 366 at [73]. 42It follows that the appellants have failed to demonstrate error on the part of the primary judge in rejecting the defence of common law qualified privilege. 43NICHOLAS J: This is an appeal from the judgment and order of a Judge of the District Court of New South Wales (Rolfe DCJ) awarding damages in a defamation action brought by the respondent, Ms Un Dok Pak, against the appellants, the Korean language newspaper, "Hojuilbo" (the "Korean Times") and its editor, Mr Joshua Nam. 44The respondent's claim arose from the publication in the edition of the newspaper of 27 February 2009 of an article which, translated, is in the following terms: "Political Donation Investigation into Un Dok PAK/JUDGE MP Mayor Ki Beom KWON couple donated $35,506 in total [Photograph] The photographs of Un Dok PAK and Virginia JUDGE MP which appeared in the Sydney Morning Herald. According to the report of Sydney Morning Herald last Wednesday, JUDGE who is the Minister for both Fair Trading and Citizenship is being [sic] under investigation on whether she lobbied to offer a place for Un Dok PAK who donated political funds to her. It is reported that the investigation by Independent Commission Against Corruption is focused on whether JUDGE MP lobbied to have solicitor Un Dok PAK, who has made political donations of more than $20,000 in the last 6 years, be appointed as the president of Community Relations Commission. Solicitor Un Dok PAK, who is the wife of Ki Beom KWON, a solicitor and a Strathfield councilor [sic], was appointed as the president of Community Relations Commission in November 2007. It is also noted that councilor [sic] Ki Beom KWON has made political donations of $15,506 to JUDGE MP in the last 5 years. As the issue is swollen, JUDGE MP issued a statement that even though she did not lobby to appoint solicitor Un Dok PAK as the president of Community Relations Commission, she had a conversation on the issue of the president of Community Relations Commission in open audience. Spokesperson for JUDGE MP stated "at that time, solicitor Un Dok PAK showed an interest on serving the citizens of NSW state through Community Relations Commission and therefore JUDGE MP recommended solicitor Un Dok PAK to apply for the position of president of Community Relations through ordinary channels. JUDGE MP who is currently in charge of Community Relations Commission, an ethnic community policy advisory organization under the NSW state government, is under investigation on whether she lobbied the former NSW premier Iemma in order to offer the position to solicitor Un Dok PAK. Sydney Morning Herald reported that Iemma said that he did not recall on this matter. According to the e-mail councilor [sic] Ki Beom KWON sent to Sydney Morning Herald, an Australian daily paper, it is noted that he declared his position as "I have a good friend relationship with JUDGE MP and I feel respect for the works of JUDGE MP. I do not have any knowledge on the claim that she lobbied for me." On 23 rd day, JUDGE MP admitted that she lobbied toward Police Minister, Tony Kelly, in relation to the proposal of installing police station at Strathfield Plaza. Strathfield Plaza is a building owned by Memo Corporation and it is noted that Memo Corporation has made political donations of more than $50,000 to JUDGE MP. Reporter, Youn Hee JEON" 45In her further amended statement of claim the respondent pleaded that the article, in its natural and ordinary meaning, conveyed the following defamatory imputations: "(a) The Plaintiff is being investigated by the Independent Commission Against Corruption for a political donation she made to Judge MP, the Minister for Fair Trading and Citizenship. (b) The Plaintiff is suspected by the Independent Commission Against Corruption of improper conduct. (c) The Plaintiff is suspected by the Independent Commission Against Corruption of soliciting Judge MP to use her influence to have the Plaintiff appointed President of the Community Relations Commission. (d) The Plaintiff has so conducted herself by making a political donation to Judge MP the Minister for Fair Trading and Citizenship that she warranted investigation by the Independent Commission Against Corruption." 46The respondent claimed compensatory, including aggravated, damages. 47By their defence to the further amended statement of claim, the appellants denied the imputations were conveyed and were defamatory. In the alternative they pleaded defences of justification (s 25 Defamation Act 2005 (the Act)), publication of public documents (s 28), statutory qualified privilege (s 30), and common law qualified privilege, including the qualified privilege for the protection of the discussion of Government or political matters. 48In reply to the defence of common law qualified privilege, the respondent pleaded that the appellants were actuated by express malice in the publication of the matter complained of. 49On the day prior to the commencement of the hearing the appellants abandoned the defence of justification. 50The proceedings below were conducted by the trial judge sitting alone. In his judgment delivered on 19 November 2010 his Honour found that the article conveyed the pleaded imputations, and that each was defamatory of her. He rejected the remaining defences. 51The trial judge also found that the appellants were actuated by malice in publishing the article. 52His Honour awarded the respondent damages, including a component for aggravated damages, in the amount of $100,000 to which was added interest in the amount of $3,600. Accordingly there was judgment for the respondent against the appellants in the amount of $103,600. 53On 3 December 2010 the trial Judge ordered the appellants to pay the respondent's costs of the proceedings on an indemnity basis. 54The respondents appealed from the judgment and orders on the following grounds: (1) and (2). None of the imputations was conveyed. (3). Imputations (a) and (d), if conveyed were not defamatory. (4). The matter complained of was published on an occasion of qualified privilege at common law. (5). The trial judge erred in finding that the appellants were actuated by malice in publishing the matter complained of. (6) and (7). The assessment of damages, including a component for aggravated damages, was erroneous. (8). The trial judge erred in awarding costs on an indemnity basis. 55During the hearing of the appeal ground (3) was abandoned. The imputations 56I summarised the attributes of the ordinary reasonable reader in Robbie Waterhouse v The Age Company Ltd & Ors [2011] NSWSC 159 as follows: "13. ... In summary, a court is required to have regard to a range of factors. It must keep in mind that a reasonable person can and does read between the lines in light of his general knowledge and experience of worldly affairs, and will draw implications much more freely than a lawyer, especially when they are derogatory. He is prone to engage in a certain amount of loose thinking. Each alleged imputation is to be considered in the context of the entire article. One must try to envisage people between those who are unusually suspicious and those who are unusually naive and see what is the most damaging meaning they would put on the words in question. The question of meaning turns on what the publication, taken as a whole, conveys to the reasonable reader, and this must always be a matter of impression. Ultimately, the question is what a jury could properly make of it. (See e.g. Lewis v Daily Telegraph Ltd [1964] AC 234, pp 258, 259, 277, 285; Favell v Queensland Newspapers Pty Ltd [2005] HCA 52; (2005) 221 ALR 186, pars 10,11 17, Malcolm v Nationwide News Pty Ltd [2007] NSWCA 254, pars 14, 15). 14. In Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158 Hunt CJ at CL (with whom Mason P and Handley JA agreed) said (p 165): "The more sensational the article in a newspaper, the less likely is it that the ordinary reasonable reader will have read it with the degree of analytical care which may otherwise have been given to a book ( Morgan v Odhams Press Ltd (at 1254, 1269)), and the less the degree of accuracy which would be expected by the reader: ibid at 1270; Steele v Mirror Newspapers Ltd (at 373). The ordinary reasonable reader of such an article is understandably prone to engage in a certain amount of loose thinking: Lewis v Daily Telegraph Ltd (at 277); Morgan v Odhams Press Ltd (at 1245); Steele v Mirror Newspapers Ltd (at 373); Mirror Newspapers Ltd v World Hosts Pty Ltd (1979) 141 CLR 632 at 641; Parker v John Fairfax & Sons Ltd (at 8). There is a wide degree of latitude given to the capacity of the matter complained of to convey particular imputations where the words published are imprecise, ambiguous, loose, fanciful or unusual: Lewis v Daily Telegraph Ltd [1963] 1 QB 340 at 374." and (p 172): "But, in the end, the test remains one of reasonableness - whether it is reasonable to hold the publisher responsible for a conclusion which is not reasonably understood to have been expressed or implied by what the publisher has said, but which the ordinary reasonable reader (or listener or viewer) has drawn for himself or herself, perhaps by having taken into account his or her own beliefs which have been excited by what was published. As I understand the law of defamation, that is fundamental to the publisher's responsibility. If the publisher does anything which makes it reasonable for him to be held responsible for something more (such as by an invitation to speculate), then he is made responsible for it." 57In John Fairfax Publications Pty Ltd v Rivkin [2003] HCA 50; (2003) 77 ALJR 1657 McHugh J said: "26 However, although a reasonable reader may engage in some loose thinking, he or she is not a person "avid for scandal". A reasonable reader considers the publication as a whole. Such a reader tries to strike a balance between the most extreme meaning that the words could have and the most innocent meaning. The reasonable reader considers the context as well as the words alleged to be defamatory. If "[i]n one part of [the] publication, something disreputable to the plaintiff is stated, but that is removed by the conclusion; the bane and antidote must be taken together". But this does not mean that the reasonable reader does or must give equal weight to every part of the publication. The emphasis that the publisher supplies by inserting conspicuous headlines, headings and captions is a legitimate matter that readers do and are entitled to take into account. Contrary statements in an article do not automatically negate the effect of other defamatory statements in the article." and Callinan J said: "187 ...It is true that an article has to be read as a whole. But that does not mean that matters that have been emphasized should be treated as if they have only the same impact or significance as matters which are treated differently. A headline, for example, expressed pithily and necessarily incompletely, but designed to catch the eye and give the reader a predisposition about what follows may well assume more importance than the latter ... The order in which matters are dealt with can be significant. The capacity of the first paragraph of an article, the "intro," to excite the reader's attention is a matter upon which editors place store. The language employed is also of relevance ... True it may be that readers may take an article or articles on impression, but the fact that they may do so is likely to have the consequence that ideas and meanings conveyed by graphic language will create the strongest impressions. Of course publishers are entitled to use colourful and seductive language, but in using it they may run the risk of seducing readers into believing only what is colourful and on occasions scandalous, rather than the facts conveyed by straight reportage." 58With these principles and considerations in mind I turn to the imputations. 59The article is presented to the reader as information about an investigation into donations paid by the respondent to Ms Virginia Judge MP. The headline: "Political Donation Investigation into Un Dok PAK/JUDGE MP Mayor Ki Beom KWON couple donated $35,506 in total" is an unambiguous statement that the investigation involves both the respondent and Ms Judge and political donations. It includes a statement to the effect that the respondent and her husband, between them, donated the total sum of $35,506. Below the headline are prominent photographs of the respondent and Ms Judge, which reinforces the suggestions of a connection between them, and that both are under investigation. The article reports: "... that the investigation by Independent Commission Against Corruption is focused on whether JUDGE MP lobbied to have solicitor Un Dok PAK, who has made political donations of more than $20,000 in the last 6 years, be appointed as the president of Community Relations Commission." 60The article states that the respondent was appointed president of the Community Relations Commission in November 2007, and that she is the wife of councillor Ki Beom Kwon, and "noted" that he has made political donations of $15,506 to Ms Judge in the last five years. 61The issue was described as "swollen" or controversial, and led Ms Judge to deny she had lobbied for the respondent's appointment, but had had a conversation in "open audience" with her about it. The reader was later told: "JUDGE MP who is currently in charge of Community Relations Commission, an ethnic community policy advisory organization under the NSW state government, is under investigation on whether she lobbied the former NSW premier Iemma in order to offer the position to solicitor Un Dok PAK. Sydney Morning Herald reported that Iemma said that he did not recall on this matter." 62Imputation (a): "(a) The Plaintiff is being investigated by the Independent Commission Against Corruption for a political donation she made to Judge MP, the Minister for Fair Trading and Citizenship." 63The appellants challenge to the finding that its imputation was conveyed was essentially on the ground that the article would not convey to the ordinary reasonable reader the meaning that the respondent was either under investigation by the Independent Commission Against Corruption (ICAC), or was suspected by it of misconduct. It was put that the ordinary reasonable reader would understand from the article, taken as a whole, that the investigation by ICAC was into the conduct of Ms Judge, and whether she lobbied for the respondent's appointment. It was put that the reader would not reasonably conclude that ICAC's investigation extended to the respondent's conduct, and the circumstances in which she made the donations to Ms Judge. 64In my opinion, the inescapable thrust of the article is that both the respondent and Ms Judge were under investigation by ICAC, and there is ample support within it for this imputation. I find that it was conveyed. 65It is a short article, in which the headline, photographs, and the opening paragraph linked the respondent and Ms Judge as persons who are together under investigation as to whether Ms Judge lobbied for the respondent's appointment in circumstances where the respondent had made "political donations" to her. The reader is told that the investigating authority is ICAC. The remainder of the article generates the firm impression that this investigation involves not only Ms Judge's conduct, but also the conduct of the respondent, and the circumstances in which the donations were made. For example, references to "political donations" to Ms Judge by the respondent and her husband over the years, which are "noted", and to the fact that "... the issue is swollen" would serve to strengthen the impression that the ICAC investigation was also concerned with the respondent's conduct. There is nothing in the article which would negate or qualify this conclusion. In my opinion it is highly improbable that the reader, having read the article as a whole, would conclude that some other body was investigating the respondent's conduct. 66Accordingly, in my opinion, the trial judge was correct in finding that imputation (a) was conveyed. 67A second ground of challenge to the trial judge's finding in respect of this imputation was that he erroneously took into account factual findings as to the falsity of the article in deciding whether it was conveyed. Having held that his Honour was otherwise correct, it is unnecessary to consider this issue although it is appropriate to say that, in my opinion, this ground should be rejected. 68The relevant passage from the trial judge's reasons is the following: "127 I do not accept the defendants' submissions. First of all, the heading in the article makes it clear that not only was Ms Judge being investigated but so was the plaintiff in connection with donations which the plaintiff and her husband made totalling $35,506. 128 The heading is reinforced by the photograph of the plaintiff appearing next to that of Ms Judge immediately under the caption. 129 Moreover, looking at the article as a whole, not only was it capable of carrying the imputation complained of but I am comfortably satisfied that it did because it links the plaintiff with Ms Judge and an investigation by ICAC concerning political donations made by the plaintiff of more than $20,000 over the previous six years to Ms Judge as a consequence of which Ms Judge is alleged to have lobbied to have the plaintiff appointed as the "president" of the CRC. The reference to the "president" of the CRC is made three more times in paragraphs 4, 5 and 6. 130 As a matter of fact, there was no investigation of any sort in relation to any donation or donations that the plaintiff or indeed her husband had made to Ms Judge's campaigns, let alone any investigation by ICAC. Nor is there any evidence that Ms Judge lobbied to have the plaintiff appointed to the CRC. 131 The fact that Ms Judge is said to have issued her statement would not have dissuaded the ordinary reasonable reader from concluding that the plaintiff was not being investigated by ICAC. Paragraph 6 of the article reinforces the opposite conclusion because it refers to the investigation again. Paragraph 7 would again have no impact on the ordinary reasonable reader concluding otherwise than that the plaintiff was being investigated by ICAC for political donations she made to Ms Judge. The final paragraph of the article would have no bearing on the matter at all. 132 As a consequence, I am comfortably satisfied that the imputation was carried, and it follows, by reference to the factual findings made by the court, that the imputation was defamatory of the plaintiff ..." 69The appellants submitted that the trial judge's reasoning indicates that in deciding that the imputation was carried, he took into account the extraneous findings contained in [130]. However, in my opinion, a fair reading of [130] in context provides no support for the submission. 70In [129] his Honour expressly stated his finding that the imputation was carried having looked at the article as a whole. The statements in [127], [128], and [131] demonstrate that he approached the task entirely in accordance with principle. It is self evident that the matters recorded in [130], which commences with the words "As a matter of fact ..." were to be understood as discrete observations which played no part in deciding whether the imputation was conveyed. 71Imputation (b) is: "(b) The Plaintiff is suspected by the Independent Commission Against Corruption of improper conduct." 72Imputation (c) is: "(c) The Plaintiff is suspected by the Independent Commission Against Corruption of soliciting Judge MP to use her influence to have the Plaintiff appointed President of the Community Relations Commission." 73The challenge to each of these imputations was on the ground that the article did not convey an imputation that the respondent was suspected by ICAC of misconduct. It was accepted that the outcome in each case should be the same as that in respect of (a). It follows that the appeal as to imputations (b) and (c) fails. 74Imputation (d) is: "(d) The Plaintiff has so conducted herself by making a political donation to Judge MP the Minister for Fair Trading and Citizenship that she warranted investigation by the Independent Commission Against Corruption." 75In finding that this imputation was conveyed the trial Judge said: "135 ... When looked at as a whole, including the heading, I consider the article would suggest to the ordinary reasonable reader that because the plaintiff made political donations to Ms Judge, she therefore warranted an investigation by ICAC." 76I respectfully agree with his Honour's finding, and with the reasons for it. 77Accordingly, the appeal on grounds 1 and 2 against the findings that the imputations were conveyed fails. Qualified privilege 78At trial, the appellants relied on the defence of common law qualified privilege which, in the defence to the further amended statement of claim, was pleaded in the following terms: "8D ... the matter complained of was published on an occasion of qualified privilege: (a) at common law; and/or (b) at common law in that it was relevant to, and/or was published in the course of, or for the purpose of, the discussion of government or political matters and the conduct of each of the defendants was reasonable in the circumstances." 79The trial judge rejected both grounds of the defence. With respect to the first ground, he held that the appellants had failed to establish the necessary requirement of reciprocity of duty or interest. The appeal was against the dismissal of the defence on the first ground. There was no appeal from the dismissal of the defence on the second ground. Background 80The respondent was born in Korea and came to Australia when aged 15 years, where she completed her secondary education and obtained university degrees in Economics and Law. She married her husband, Ki Beom Kwon, in 1988. The respondent and her husband are solicitors practising in the firm KP Lawyers, at Strathfield. Mr Kwon has been a councillor on Strathfield Council for some six years, and has been its mayor. The respondent and her husband are members of the Australian Labor Party. 81The respondent met Ms Judge in about 2000 or 2001 when Ms Judge was the mayor of Strathfield. In the following years the respondent and her husband contributed $21,000 to an organisation called "Friends of Virginia Judge". Further donations of about $15,000 were made to the Strathfield branch of the Australian Labor Party when Mr Kwon was nominated by it as a candidate at the council election in 2008. 82The respondent has had a long and active involvement through various organisations with the Korean community in Australia. She has held positions in voluntary bodies including as president of the Korean Australian Women's Forum, public relations officer to the Korean Australian Chamber of Commerce and Industry, vice president of the Korean Society of Sydney, and vice president of the Korean Australian Lawyers Association. She has also served as the president of the Strathfield Chamber of Commerce and as a director of the Strathfield Community Branch of the Bendigo Bank. 83In February 2007 Ms Judge invited the respondent to consider an appointment to the Community Relations Commission (CRC) as a part time commissioner, and to apply through the usual channels. The respondent decided to do so, and in November 2007 was appointed a part time commissioner. 84On 25 February 2009 an article was published in the newspaper, "The Sydney Morning Herald" under the heading: "Minister faces more questions on donations". It included photographs of the respondent and Ms Judge above the caption: "Left: Donor Vivian Pak and Virginia Judge who is under investigation". 85It included the following: "Vivian Un Dok Pak, who, with her firm KP Lawyers, has donated more than $20,000 to Ms Judge's campaigns over the past six years, was appointed to the commission in November 2007. Her husband, Keith Kwon, the Mayor of Strathfield, has also donated $15,506 to Ms Judge over the past five years. Ms Judge, who is in charge of the commission as Citizenship Minister, said in a statement yesterday she had not lobbied to have Ms Pak appointed but had had a conversation with her about the position, which pays $170 for each monthly meeting. "Ms Pak expressed an interest in serving the people of NSW on the Community Relations Commission. Ms Judge encouraged Ms Pak to apply ... through the usual channels", a spokeswoman said. ... Ms Pak told the Herald yesterday by email: Minister Judge and I are good friends and I have great respect for her work. I am not aware of any lobbying being done by any person on my behalf." The revelations come after Ms Judge referred herself to the Independent Commission Against Corruption over another matter involving donations following questions from the Herald ." 86On 27 February 2009 the matter complained of was published. 87The second appellant proof reads and edits all articles published in the Korean Times, and decides what will and will not be published. He considers it necessary to publish to the Korean community matters of interest which have been reported in the major Australian newspapers and local press. Ms You Hee Jeon, a reporter employed by the appellants, wrote the matter complained of. Her main role was to write articles in Korean based on articles published in the English language press. Preparation of the matter complained of was prompted by telephone calls to the second appellant from members of the Korean community who told him about "The Sydney Morning Herald" article. One of the callers asked him to do something about it because it was humiliating to the Korean community. Prior to publication the second appellant read and approved the draft. He thought it was necessary to publish it because the respondent, her husband, and Ms Judge were well-known in the Korean community. He considered it unnecessary to speak to the respondent prior to publication because of the denials contained in "The Sydney Morning Herald" article which he trusted. He believed the matter complained of to be true. 88The Korean Times is published every Friday. It is free, and is distributed in locations frequented by members of the Korean community, including grocery stores, video shops, and restaurants. Of the edition which included the matter complained of, 6,000 copies were distributed in New South Wales with an estimated readership of 12,000 people. In addition, 50 copies were distributed in Victoria, 500 in Queensland, 100 in Western Australia, and 50 in the Australian Capital Territory. 89In addition to "the Korean Times" the other Korean language newspapers published in the Sydney region are "Hojudong A", "Top", and "the Korean Herald". According to the second appellant the Korean language newspapers are read by persons more than 50 years old whilst those younger, or about 80 percent of the Korean community, read the English language newspapers, including "The Sydney Morning Herald". The principles 90The principles applicable to the defence of qualified privilege at common law were stated by Parke B in Toogood v Spyring (1834) 1 Cr M & R 181 at 913; 149 ER 1044 at p 1049: ''In general, an action lies for the malicious publication of statements which are false in fact, and injurious to the character of another (within the well-known limits as to verbal slander), and the law considers such publication as malicious, unless it is fairly made by a person in the discharge of some public or private duty, whether legal or moral, or in the conduct of his own affairs, in matters where his interest is concerned. In such cases, the occasion prevents the inference of malice, which the law draws from unauthorized communications, and affords a qualified defence depending upon the absence of actual malice. If fairly warranted by any reasonable occasion or exigency, and honestly made, such communications are protected for the common convenience and welfare of society; and the law has not restricted the right to make them within any narrow limits." 91In Aktas v Westpac Banking Corporation [2010] HCA 25; (2010) 241 CLR 79 French CJ, Gummow and Hayne JJ said: "14 ... As a general proposition, the common law protects the publication of defamatory matter made on an occasion where one person has a duty or interest to make the publication and the recipient has a corresponding duty or interest to receive it; but the privilege depends upon the absence of malice. The requirement of reciprocity of interest generally denies the common law privilege where the matter has been disseminated to the public at large." 92With reference to Toogood v Spyring , in Cush v Dillon; Boland v Dillon [2011] HCA 30; 85 ALJR 865 French CJ, Crennan, and Kiefel JJ confirmed at [11] that reciprocity of duty and interest is "... the hallmark of the common law defence of qualified privilege". They said: "12 The defence of qualified privilege is based upon notions of public policy, that freedom of communication may in some circumstances assume more importance than an individual's right to the protection of his or her reputation. The question of whether the person making a defamatory statement was subject to some duty or was acting in the protection of some interest, in making the statement, is to be understood in this light." 93In Andreyevich v Kosovich (1947) 47 SR(NSW) 357 at pp 363-364 Jordan CJ held that in order for the defendants in that case to succeed in the defence of qualified privilege: "... it was necessary that they should show by evidence that both the givers and the receivers of the defamatory information had a special and reciprocal interest in its subject matter, of such a kind that it was desirable as a matter of public policy, in the general interest of the whole community of New South Wales, that it should be made with impunity, notwithstanding that it was defamatory of a third party. 'The word 'interest', as used in the cases, is not used in any technical sense. It is used in the broadest popular sense, as when we say that a man is 'interested' in knowing a fact - not interested in it as a matter of gossip or curiosity, but as a matter of substance apart from its mere quality as news': Howe v Lees. 'The interest relied on as a foundation of privilege must be definite. It may be direct or indirect, but it must not be vague or unsubstantial. So long as the interest is of so tangible a nature that for the common convenience and welfare of society it is expedient to protect it, it will come within the rule': Ibid. " 94In Stephens v West Australian Newspapers Ltd [1994] HCA 45;(1994-1995) 182 CLR 211, p 242, Brennan J explained the basis for the limited availability of the defence to the publication of a newspaper. He said: "In principle, the defence of qualified privilege is available to a newspaper defendant as it is to any other defendant who publishes defamatory matter. But a newspaper defendant is often unable to satisfy the requirements or elements of the defence of qualified privilege ... As Evatt J pointed out in Telegraph Newspaper Co Ltd v Bedford , the ``guiding principle'' of reciprocal duty or interest, which is necessarily broad and general, is based solely on public utility. When a publication is said to have been made in discharge of a social or moral duty, the occasion is privileged only if it be in ``the interest of the community'', ``for the welfare of society'' or ``for the good of society in general'' - these phrases being synonyms for Baron Parke's ``for the common convenience and welfare of society''. When it is said that a publication is privileged because it is made in the public interest, ``interest'' is not to be equated with curiosity. It is used in a non-technical sense to mean that the publication is made for the welfare of society. As Bedford's case illustrates, a publication defamatory of the plaintiff is not made on an occasion of qualified privilege merely because the person or persons to whom it is made - in that case, the readers of the newspaper - were interested in the subject matter. And, if the publication is made to protect an interest of the person making the defamatory statement, the publication is protected only if it be made to ``a person who, if the defamatory matter be true, may reasonably be expected to be of service in the protection of the interest''. The common law places a higher value on the protection of personal reputation than on the satisfaction of curiosity or on the dissemination of defamatory material which is not reasonably calculated to be of service in the protection of the interests of the person making the defamatory statement." 95In Stephens McHugh J noted that the defence is generally not available where defamatory matter is published in a newspaper (p 260). He said at p 263-264: "In determining whether a person has a legal, social or moral interest or duty to publish to the world at large, the extent of the publication and the proportion of readers who have a legitimate interest in receiving the communication are relevant factors to be weighed. It has long been established, however, that qualified privilege is not lost simply because the communication is read, seen or heard by persons having no legitimate interest in receiving the communication. ... ... common law courts have taken a restricted view of the occasions when a person has an interest or duty to publish material to the general public. Protection of reputation has generally been preferred to the right of the public to know. It is not surprising that successive generations of common law judges have been loath to extend the categories of qualified privilege to protect publications in the general media." 96In Austin v Mirror Newspapers Ltd (1985) 3 NSWLR 354 at p 358 the type of interest relevant to the defence of qualified privilege at common law was described as "... an interest material to the affairs of the recipient of the information such as would for instance assist in the making of an important decision or the determining of a particular course of action." 97In Morosi v Mirror Newspapers [1977] 2 NSWLR 749 this court, after an extensive review of the authorities, held that defamatory statements do not come within the scope of common law qualified privilege merely because they may relate to a matter of public interest. It said (p 778): "It is apparent from these decisions and dicta that, at common law, a publication in a newspaper is not the subject of qualified privilege merely because it gives the public information concerning a matter in respect of which the public is interested. Something more is needed which is said in some circumstances to constitute a duty, and in other circumstances an interest, on the part of the newspaper to communicate the information." and (p 792): "Newspapers play an important role in our society, but that role does not call for an unrestricted licence to defame people, simply because it can be shown that the defamatory material was part of an article or other form of publication on a matter of public interest, and that the publication was not malicious. Defamatory publications on matters of public interest are protected under the common law, and by statute, in various ways, but something more than mere public interest is required. It may be truth; or it may be reasonableness, in all the circumstances, of the conduct of the publisher in making the publication; or it may be some other requirement." 98In Bashford v Information Australia (Newsletters) Pty Ltd [2004] HCA 5; (2004) 218 CLR 366 McHugh J, who dissented in the outcome, explained the task of the court in determining whether the occasion on which a communication is made is an occasion of qualified privilege. He said: "54 ... In determining whether the occasion was privileged, the court examines all the circumstances of the case. They include the nature of the defamatory communication, the status or position of the publisher, the number of recipients and the nature of any interest they had in receiving it, and the time, place and manner of, and reason for, the publication. After considering these matters, the court makes a judgment as to whether the publisher had a duty or interest that justified making the publication and whether the recipients, or some of them, had a duty to receive or interest in receiving it. Evaluating these questions of duty and interest usually involves questions of public policy. In Toogood v Spyring , Parke B said that "[i]f fairly warranted by any reasonable occasion or exigency, and honestly made, such communications are protected for the common convenience and welfare of society". Griffith CJ cited this passage with approval in Howe & McColough v Lees . There, Griffith CJ explained that the reference to the welfare of society did not mean that the person who made the communication was under an obligation to publish and was justified in publishing it to the public at large. Rather, according to his Honour, the phrase means that the interests of society in general require that a communication made under the particular circumstances to the particular person should be protected. 55 It is of the first importance to understand that references to concepts such as "the common convenience and welfare of society" and similar phrases record a result and explain why the communication and the relevant duty or interest gave rise to an occasion of qualified privilege. Such concepts are not the determinants of whether the occasion is privileged. They must be distinguished from the question whether society would recognise a duty or interest in the publisher making, and the recipient receiving, the communication in question ..." 99In Bennette v Cohen [2009] NSWCA 60 Ipp JA said: "(10) When read in isolation, the traditional Toogood v Spyring formulation of the applicable test gives the impression that common law qualified privilege is capable of having a very wide reach. That, however, is not the case. The application of this privilege is confined to strict limits. It was for this reason (as explained in Morosi v Mirror Newspapers [1977] 2 NSWLR 749 at 797) that the relatively narrow scope of common law qualified privilege gave rise to s 22 of the Defamation Act 1974 (the current equivalent being s 30 of the Defamation Act 2005). Dissatisfaction with the limitations of common law qualified privilege caused Parliament to enact s 22, thereby creating a statutory defence of qualified privilege that rested on a far broader meaning of "interest" than is the case at common law: see also Austin v Mirror Newspapers Ltd (1985) 3 NSWLR 354; [1986] AC 299 at 359 (312) per the Privy Council." 100In Lange v Australian Broadcasting Corporation [1997] HCA 25; 189 CLR 520 (pp 571, 573) the court declared that common law qualified privilege extended to communications made to the public on government or political matters subject to the requirement that the conduct of the publisher was reasonable. It said (p 571): "Accordingly, this court should now declare that each member of the Australian community has an interest in disseminating and receiving information, opinions and arguments concerning government and political matters that affect the people of Australia. The duty to disseminate such information is simply the correlative of the interest in receiving it. The common convenience and welfare of Australian society are advanced by discussion - the giving and receiving of information - about government and political matters. The interest that each member of the Australian community has in such a discussion extends the categories of qualified privilege. Consequently, those categories now must be recognised as protecting a communication made to the public on a government or political matter." and (p 572): "But, apart from a few exceptional cases, the common law categories of qualified privilege protect only occasions where defamatory matter is published to a limited number of recipients. If a publication is made to a large audience, a claim of qualified privilege at common law is rejected unless, exceptionally, the members of the audience all have an interest in knowing the truth. Publication beyond what was reasonably sufficient for the occasion of qualified privilege is unprotected. Because privileged occasions are ordinarily occasions of limited publication - more often than not occasions of publication to a single person - the common law has seen honesty of purpose in the publisher as the appropriate protection for individual reputation. As long as the publisher honestly and without malice uses the occasion for the purpose for which it is given, that person escapes liability even though the publication is false and defamatory. But a test devised for situations where usually only one person receives the publication is unlikely to be appropriate when the publication is to tens of thousands, or more, of readers, listeners or viewers." and (p 573): "Given these considerations and given, also, that the requirement of honesty of purpose was developed in relation to more limited publications, reasonableness of conduct seems the appropriate criterion to apply when the occasion of the publication of defamatory matter is said to be an occasion of qualified privilege solely by reason of the relevance of the matter published to the discussion of government or political matters. But reasonableness of conduct is imported as an element only when the extended category of qualified privilege is invoked to protect a publication that would otherwise be held to have been made to too wide an audience. For example, reasonableness of conduct is not an element of that qualified privilege which protects a member of the public who makes a complaint to a minister concerning the administration of his or her department. Reasonableness of conduct is an element for the judge to consider only when a publication concerning a government or political matter is made in circumstances that, under the English common law, would have failed to attract a defence of qualified privilege." 101The development was explained in Roberts v Bass [2002] HCA 57; (2002) 212 CLR 1 by Hayne J: "222 ... Lange held that communications of political matter to audiences in circumstances which would not fall within that earlier understanding of an occasion of qualified privilege could be privileged, but only if a different test was met. Lange did not hold that any different test was to be applied if the publication did fall within that earlier understanding of an occasion of qualified privilege. 223 It is important to notice that the decision in Lange proceeded from two premises, first, that each member of the Australian community has an interest in disseminating and receiving information, opinion and arguments concerning government and political matters that affect the people of Australia but, second, that this interest did not suffice to found a claim to qualified privilege according to then understood principles. The interest which was identified was not restricted to the interest of electors or of federal electors in matters of federal politics." Determination 102With respect to the defence of common law qualified privilege, the trial judge held that the appellants had failed to establish the necessary reciprocity of duty or interest. At trial it was submitted that there existed a reciprocity of duty or interest between the newspaper and its readers in the publication and receiving of information which was of interest to the Korean community. In this case, the information in the matter complained of concerned the investigation of political donations to a local member of parliament, Ms Judge, from the respondent and her husband, who were prominent members of the Korean community. It was put that to establish publication on an occasion of qualified privilege at common law it was sufficient that this information was of general interest to the readers of this newspaper. These submissions were rejected. 103The second ground advanced was based on the extended category of common law qualified privilege recognised in Lange . The trial judge found the appellant had failed to establish reasonable grounds for believing the imputations were true, or that they had taken proper steps to verify the accuracy of the publication. He also found that no effort had been made to seek a response from the respondent prior to publication. He held the appellants had failed to establish that their conduct in publishing the matter complained of was reasonable in the circumstances and, accordingly, rejected this ground of defence. There was no appeal against this decision. 104On appeal, the appellants contended that the circumstances of the publication demonstrated the existence of reciprocity of interest sufficient to attract the protection of common law qualified privilege. However, the argument proceeded differently to that advanced at the trial. 105In this court it was put that it should be inferred from the evidence that a substantial number of members of the Korean community who were readers of this Korean language newspaper were incapable of understanding the English language press, and thus had available to them either few, or no, other sources of news or information on government or political matters. It was this lack of understanding of the English language which precluded the readers from obtaining information from the English language press. It was put that as the matter complained of was a communication made to the public on government or political matters, the relevant reciprocity of duty or interest between the newspaper and its readers existed, being the kind of relationship recognised in Lange (p 571). It was put that reciprocity existed in these circumstances irrespective of notions of reasonableness. 106The appellants correctly accepted that reciprocity does not arise with mass media publications except in exceptional circumstances. They accepted that the defence would not be available if the matter complained of had been published in an English language newspaper. Their submission was that as this was a communication only to those whose access to other sources of information on government or political matters was limited, and as the necessarily reciprocity was established, it was for the common convenience and welfare of society that the matter complained of was published. It followed, so it was put, that the occasion of publication in this case fell within the category of exceptional cases in which the common law has recognised an interest or duty to publish defamatory matter to a large number of people. The appellants accepted that if the court did not draw the inference that the readers were not confined to the Korean Times for information of this kind the argument failed at the outset. 107In Lange the court imposed the requirement of reasonableness to protect a publication concerning government or political matter in circumstances where, at common law, it would have failed to attract a defence of qualified privilege. Hayne J ( Roberts , [223]) pointed out that the interest that each member of the Australian community has in disseminating and receiving information on government and political matters is not an interest sufficient to found a claim to qualified privilege. 108As the appellants no longer claim that their conduct in publishing the matter complained of was reasonable, the availability of the defence of qualified privilege must be determined according to ordinary common law principles. The essential question for the court is whether the matter complained of, being defamatory of the respondent, was published in circumstances where the reciprocity of interest between the newspaper and its readers was of such a kind that it was for the common convenience and welfare of society that its publication be protected. The judgment is to be made after examination of all the circumstances of the case ( Andreyevich p 363, 364; Bashford [54], [55]). 109The evidence was that the Korean Times was a free weekly newspaper available to the public from shops and similar outlets. Of the edition which included the matter complained of, 6,000 copies were distributed in New South Wales with an estimated readership of 12,000 people. A small number of copies was distributed in other states of Australia. 110Although it may be accepted that there was a reciprocity of interest in publishing and receiving the information concerning the respondent as information about government or political matters, such an interest is not of the kind which has been recognised as sufficient to found a defence of qualified privilege. The principle that usually the defence is unavailable to publishers of newspapers to a wide readership is not limited in its application in Australia to English language newspapers. The authorities give no support to the notion that the non-English language press is in a different position. The fact that the readership of non-English language newspapers is limited to those who understand the language in which they are written does not of itself establish the necessary reciprocity of duty and interest for the defence. 111It was to surmount this hurdle that the appellants sought to show that the interest of the readers of the Korean Times in the matter complained of was greater than an interest in having information on matters of general public interest. They submitted, in effect, that the interest was heightened because a substantial number of readers of the newspaper lacked an understanding of the English language, and they were thereby precluded from obtaining similar information from the English language press. It was put that the dependence of many readers of the Korean Times for information on government or political matters was a matter for inference. This was an issue which had not been raised at the trial. 112In rejecting the submission it is sufficient to say that there was no evidence which provided any legitimate support for a finding to that effect. To the extent it is relevant to the issue, the evidence was that the Korean community was served by three Korean language newspapers in addition to the Korean Times, and that about 80 percent of the Korean community read the English language newspapers. 113Having identified the readership, in order to succeed it was necessary for the appellants to show the existence of a reciprocal duty or interest between the newspaper and its readers sufficient to attract the defence of common law qualified privilege. This they have not done. In the result, the appellants have failed to demonstrate that the occasion of the publication of the matter complained of was of an exceptional kind as to attract the protection. 114The appeal on this ground must be dismissed. 115As the publication was not made on an occasion of qualified privilege, it is unnecessary to consider the question of malice. Damages 116The respondent was awarded damages, including a component for aggravated damages, which, including interest, was in the amount of $103,600. 117The appeal against the award is on grounds that the trial judge was in error in including a component for aggravated damages, and the amount was excessive. It was agreed that this court should reassess damages if error was found. 118Relevantly, the trial judge's reasons for awarding aggravated damages were as follows: "166 An award of aggravated damages is appropriate having regard to the above but also having regard to the defendants' behaviour and attitude, the finding I have made about malice and noting that the defendants still refuse to apologise to the plaintiff. As well, it is clear from the evidence of the witnesses that "face" or "saving face" is an important aspect of Korean culture." 119His Honour had earlier found at [158] that the second appellant was an unimpressive witness "... because he continued to argue with counsel, he refused to acknowledge that the article contained untruths about the plaintiff and he continued to refuse to apologise ...". 120Further, in deciding that the appellants acted with malice in publishing the matter complained of, the trial judge found at [159] their motive was improper in that the second appellant wanted to teach the respondent a lesson. The principles 121By s 34 of the Act, the court, in determining the amount of damages to be awarded, is to ensure that there is an appropriate and rational relationship between the harm sustained by the plaintiff and the amount of damages awarded. 122By s 35(1), unless otherwise ordered, the maximum amount for non-economic loss which may be awarded is $250,000. The amount was increased to $324,000 from 1 July 2011 by an order published under s 35(3). 123By s 36 the court is to disregard the malice of the defendant at the time of the publication or at any other time except to the extent that the malice affects the harm sustained by the plaintiff. 124By s 37 an award of exemplary or punitive damages is precluded. 125The relevant principles were stated in Ali v Nationwide News Pty Ltd [2008] NSWCA 183 at [70]-[84] by Tobias JA and McColl JA. They referred to the following observations of Hayne J in Rogers v Nationwide News Pty Ltd [2003] HCA 52; (2003) 216 CLR 327 at [60]: 'The three purposes to be served by an award of damages for defamation are identified in the joint reasons in Carson v John Fairfax & Sons Ltd : (i) consolation for the personal distress and hurt caused to the appellant by the publication; (ii) reparation for harm done to the appellant's personal, and in this case, professional reputation; and (iii) the vindication of the appellant's reputation. As pointed out in Carson : the first two purposes are frequently considered together and constitute consolation for the wrong done to the appellant; vindication looks to the attitudes of others.' 126In Ali at [79]-[85] courts are reminded that in awarding aggravated damages, the conduct of the defendant which will increase the harm caused by the publication of the libel, a failure to apologise, and the conduct of the defendant right up to the amount of verdict are all matters which may be taken into account. 127To attract an award of aggravated damages by reason of the conduct of a defendant, a plaintiff must show that such conduct was in some way unjustifiable, improper, or lacking in bona fides notwithstanding that the conduct may cause distress to the plaintiff ( Triggell v Pheeney (1951) 82 CLR 497; Bickel v John Fairfax & Sons Ltd [1981] 2 NSWLR 474 at p 497). Determination 128On the issue of aggravated damages, the appellants submitted the trial judge erred in taking into account their behaviour, attitude and malice. It was submitted that he was precluded from doing so under s 36 of the Act which provides: "36 State of mind of defendant generally not relevant to awarding damages In awarding damages for defamation, the court is to disregard the malice or other state of mind of the defendant at the time of the publication of the defamatory matter to which the proceedings relate or at any other time except to the extent that the malice or other state of mind affects the harm sustained by the plaintiff." 129As there was no evidence that the respondent's harm was affected by these factors, the exception was not established. In my opinion, the trial judge erred in having regard to them. 130As it is not possible to identify the extent to which the overall assessment of compensatory damages was increased by these considerations, it is inevitable that the award should be set aside and reassessed by this court. 131It was also submitted that the trial judge erred in having regard to the refusal to apologise as an aggravating factor. It was put, in effect, that the evidence did not support a finding that the refusal was improper or unjustifiable in the circumstances. In my opinion, it was open on the evidence to regard this aspect of the appellant's conduct as a ground of aggravation. 132The demand for the apology was made by the respondent's letter to the appellants of 13 March 2009. It included: "... What I am seeking is a clear statement by you, in your newspaper, that I have not acted in any improper manner nor sought personal gain. If you have any journalistic pride or ethics you will print a retraction and correction of this article by Youn Hee Jeon and the many other articles that have been written based on reports in the Sydney Morning Herald. To maintain your paper's excellent reputation in the Korean community I require that you print an apology and corrections to all the inaccuracies in this article and other articles published by your paper. Please note I will be referring raising my complaint with the Australian Press Council and will provide them with a copy of this letter. I will of course, raise any further misleading and misrepresentations that are published in your paper to the Australian Press Council." 133Thereafter the appellants made no response to the respondent, but corresponded with the Australian Press Council (the APC) about the complaint. 134By email of 21 April 2009 to the APC, the appellants included the terms of a correction statement which they proposed to publish in respect of some factual mistakes. The proposal was forwarded by the APC to the respondent. By letter of 22 April 2009 to the APC, the respondent detailed her criticisms of the proposed correction, and referred to the damage to her reputation caused by the matter complained of. She stated that it was for the second respondent to suggest an appropriate resolution of the matter. On 5 June 2009 the appellants informed the APC of publication the same day of the correction as earlier proposed. It contained no apology to the respondent. 135The respondent became aware of this publication about a month later. She did not regard it as either an apology or as a satisfactory retraction. In cross-examination, which included questions from the trial judge, the second defendant eventually conceded that he knew the respondent wanted an apology, and agreed that none was printed. He asserted that the correction was adequate and typical of corrections published in Korean language newspapers. 136The matter complained of remained on the internet, and was downloaded by the respondent shortly before commencement of the trial. 137In my opinion, the evidence sufficiently established that the refusal of the appellants to apologise, and in proceeding to publish a correction which they knew was unacceptable to the respondent, was, in the circumstances, improper and unjustifiable. In my opinion they have failed to show that it was wrong for the trial judge to take this conduct into account as aggravating the damages to be awarded. 138As the award is unsafe and falls for reassessment, it is unnecessary to deal with the argument that it was excessive. 139The trial judge's findings were not challenged. At the time of publication the respondent had a sound reputation for honesty and integrity, and was of high standing in the Korean community. She held senior positions in numerous public bodies which served the community, to which reference has earlier been made. For some years she had been in practice as a solicitor in partnership with her husband in Strathfield. Her clientele is mainly Korean. 140The imputations were grave allegations that she was suspected by ICAC of improper conduct for political donations to a member of parliament which warranted investigation by it. They were published to about 12,000 readers in the Korean community. Witnesses testified to the injury caused to her reputation as a result. Unsurprisingly, her evidence was that she felt very upset, disgusted, sick, and shocked by the publication. The litigation worried her. She swore to the falsity of the imputations, and was upset that the appellants maintained a defence of truth until the day before the trial. 141The respondent is entitled to compensation for damages done to her reputation and for hurt to feelings. The award must be sufficient to enable her to point to it as a vindication of her reputation and to mark the baselessness of the defamation ( Cassell & Co Ltd v Broome [1972] AC 1027; Ley v Hamilton (1935) 153 LT 384). 142The evidence indicates that the greater component of the award should be for compensation for hurt to feelings. 143Factors to be taken into account include the continuing harm occasioned by the appellants' persistence in the plea of justification, and the strain occasioned by the proceedings. The respondent is entitled to aggravated compensatory damages for the refusal to apologise, and for the falsity of the imputations ( Waterhouse v Broadcasting Station 2GB Pty Ltd (1985) 1 NSWLR 58, p 75; Rigby v Associated Newspapers [1969] 1 NSWR 729, p 738). 144In assessing the amount of damages to be awarded to the respondent I have been guided by the relevant principles which emphasise its compensatory, not punitive, purpose and require there be an appropriate and rational relationship between the harm sustained by the respondent and the amount awarded. 145In my assessment the appropriate award of damages is the amount of $80,000. To this amount should be added interest calculated from the date of publication to the date of judgment in the court below at the rate of 2 percent, which produces the amount of $2,810. Accordingly there will be an award of damages for the respondent in the total sum of $82,210. Costs 146A ground of appeal was that the trial judge erred in awarding costs on an indemnity basis. The order was made under s 40 of the Act for reasons delivered on 3 December 2010. The appellants made no submissions, and accepted that no challenge would be made if the respondent's verdict was upheld. In light of the orders proposed, it is unnecessary to deal further with this issue. 147The appellants have had a degree of success with respect to the question of assessment of damages. Otherwise the appeal has failed. This is a case in which it is appropriate to award costs by reference to the issues on which the parties succeeded or failed. On that approach, the appellants should pay 80% of the respondent's costs in this Court. Orders 148I propose the following orders: (1)Allow the appeal in part and set aside order 1 made in the District Court on 19 November 2010. (2)In lieu of the judgment in the District Court, give judgment for the plaintiff against the defendants in the amount of $82,810, such judgment to take effect from 19 November 2010. (3)Otherwise dismiss the appeal. (4)Order the appellants to pay 80% of the respondent's costs in this Court. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 30 November 2011