Supreme Court New South Wales Medium Neutral Citation: Chel v Fairfax Media Publications Pty Limited [2015] NSWSC 171 Hearing dates: 27 February 2015 Date of orders: 06 March 2015 Decision date: 06 March 2015 Jurisdiction: Common Law Before: McCallum J Decision: Application for leave to amend further amended statement of claim refused; application to have reply struck out refused Catchwords: DEFAMATION – pleadings – application by plaintiff for leave to amend pleadings so as to include defendants' contextual imputation as one of the imputations of which the plaintiff complains – whether an abuse of process – discretionary considerations Legislation Cited: Uniform Civil Procedure Rules 2005 (NSW), r 14.28, 14.30 Defamation Act 2005 (NSW), ss 25, 26 Cases Cited: Kermode v Fairfax Media Publications Pty Ltd [2010] NSWSC 852 Besser v Kermode [2011] NSWCA157; 81 NSWLR 157 Holt v TCN Channel 9 Pty Ltd [2014] NSWCA 90; 85 NSWLR 96 Mallegowda v Sood (No 3) [2015] NSWDC 14 Petty v Zhao (No 2) [2015] NSWDC 18 Jeffery & Katauskas Pty Ltd v SST Consulting Pty Ltd [2009] HCA 43; 239 CLR 75 Category: Procedural and other rulings Parties: Lili Chel (Plaintiff) Fairfax Media Publications Pty Limited (First Defendant) Vanda Carson (Second Defendant) Representation: Counsel: R Rasmussen (Plaintiff) T D Blackburn SC and MA Polden (Defendants) Solicitors: Beazley Singleton (Plaintiff) Banki Haddock Fiora (Defendants) File Number(s): 2011/409423 Publication restriction: None Judgment 1. HER HONOUR: These are proceedings for defamation arising out of the publication of an article in The Sun Herald on 26 December 2010 under the headline "On-stage sex at city club sparks battle over licence". 2. This judgment determines two procedural applications. The first is the plaintiff's application to amend her pleading so as to include, as imputations complained of by her, two contextual imputations that have been pleaded by the defendants in support of a defence of contextual truth. The second is an application by the defendants to have the reply struck out pursuant to r 14.28 of the Uniform Civil Procedure Rules 2005 (NSW). Plaintiff's application to appropriate the defendant's contextual imputations 1. A plaintiff in a defamation action must specify the imputations upon which he or she relies: r 14.30 UCPR. It is a defence to the publication of defamatory matter if the defendant proves that those imputations are substantially true: s 25 of the Defamation Act 2005 (NSW). Separately, it is a defence if the defendant proves that, in addition to those imputations, the matter carried other imputations that are substantially true and the defamatory imputations do not further harm the reputation of the plaintiff because of the substantial truth of the contextual imputations: s 26 of the Defamation Act. 2. The defendant's contextual imputations must necessarily be imputations other than those of which the plaintiff complains. 3. It is, I think, beyond doubt that the Court has a discretion to allow a plaintiff to amend his or her pleading so as to adopt a contextual imputation pleaded by a defendant: Kermode v Fairfax Media Publications Pty Ltd [2010] NSWSC 852 at [41] per Simpson J; approved in Fairfax Media Publications Pty Ltd v Kermode (2011) 81 NSWLR 157 at [88] to [89] per McColl JA; cited with approval in Holt v TCN Channel 9 Pty Ltd (2014) 85 NSWLR 96 at [23] per Macfarlan JA; Gleeson JA and Sackville AJA agreeing; and see my decision in Hall v TCN Channel 9 Pty Ltd [2014] NSWSC 1604. 4. A helpful and informative analysis of the relevant authorities may be found in two decisions of the defamation list judge in the District Court, Gibson DCJ in Mallegowda v Sood (No 3) [2015] NSWDC 14 and Petty v Zhao (No 2) [2015] NSWDC 18. 5. The defendants in the present application did not take issue with the correctness of that proposition. The critical contest in the present application was as to the principles that should guide the exercise of the Court's discretion to allow a plaintiff to take that course. 6. Before turning to the parties' submissions on that issue, it is necessary to record something of the history of the proceedings. As already noted, the matter complained of was published on 26 December 2010. The proceedings were commenced on 20 December 2011, six days prior to the expiration of the limitation period. The statement of claim had not been served prior to the first mention date. The proceedings were stood over twice to allow that to occur. Upon being served with the statement of claim, the defendants promptly notified their objections to the form of the pleading and those objections were determined in an ex tempore judgment given on 10 April 2012. The plaintiff was granted leave on that date to file an amended statement of claim within 14 days. 7. An amended statement of claim was filed (late) but the proceedings appear then to have gone into abeyance for a year, with no further step being taken by the plaintiff. 8. On 6 May 2013, the defendants' objections to the amended statement of claim were determined (in an ex tempore judgment). A further amended statement of claim was filed that date. The defendants filed their defence on 25 June 2013 (almost two weeks late). The plaintiff then filed her reply almost three months late. There followed a period of about a year during which timetables for further interlocutory steps were repeated several times, with no apparent advance in the preparation of the matter for trial. 9. The last timetable (ordered by the Registrar on 18 July 2014) included provision for a court annexed mediation which was ultimately listed on 1 December 2014. 10. In the meantime, on 14 November 2014, I published my decision in Hall v TCN Channel 9. On 2 December 2014 (presumably after an unsuccessful mediation), the plaintiff gave notice of her application to amend the pleading to include the plaintiff's contextual imputations in accordance with the principles accepted in that decision. 11. In those circumstances, the defendants contended: 1. that the dictates of justice require that the amendment be refused (it was submitted that in the circumstances of this case it would be an error of discretion to make the order); 2. that the making of the orders sought would constitute an abuse of process; 3. that the proposed amendments are not "necessary" within the meaning of s 64(2) of the Civil Procedure Act 2005 (NSW). 1. In my view, the contention that the making of the orders would constitute an abuse of process is misconceived. The defendants relied upon the decision of the High Court in Jeffery & Katauskas Pty Ltd v SST Consulting Pty Ltd [2009] HCA 43; 239 CLR 75 at [56] where the Court affirmed the principle that an abuse of process arises "in all those categories of cases in which the processes and procedures of the Court, which exist to administer justice with fairness and impartiality, may be converted into instruments of injustice or unfairness". 2. The burden of the submission was that it is an abuse of process to seek the amendment in the present case because it is sought for the purpose of destroying a defence regularly pleaded, "taking advantage of the drafting in the Defamation Act 2005". 3. A similar argument was put, and rejected, in Kermode in the passages cited above. Simpson J noted that, by "appropriating" the defendants' contextual imputations, a plaintiff could deprive a defendant of a defence under s 26. Her Honour said (in my respectful opinion, correctly): "Senior Counsel's proposition is correct, but it cannot be allowed to dictate the proper approach to statutory construction." 1. The simple fact is that there is nothing in the statute to prohibit a plaintiff from relying on an imputation which happens, as a matter of history, first to have been pleaded by a defendant as a contextual imputation. As a matter of practicality, however, to do so requires an amendment with the leave of the Court. Whether leave should be granted is a discretionary judgment to be made according to the dictates of justice in the individual case. 2. In my view, there is force in the defendants' contention that, in the circumstances of this case, the dictates of justice are that leave to amend should be refused. The following considerations have conduced me to that conclusion. 3. First, the proceedings have suffered from an unacceptable measure of delay the responsibility for which falls largely, if not exclusively, at the feet of the plaintiff. It took almost 2 years for the pleadings to be brought to a close and a further year for subsequent interlocutory steps. Only after those events is this application brought. 4. I accept that notice of the application was given promptly after publication of my decision in Hall v TCN Channel 9. That decision may have fortified the plaintiff in her decision to bring the present application but it did not establish the existence of the relevant discretion. More pertinent is the fact that the application was not brought until over 17 months after the contextual imputations were pleaded. 5. Secondly, it is relevant, in my view, to consider why the imputation was not brought forward by the plaintiff in the first instance. The pleading difficulties created by the current state of the law were explained by Gibson DCJ in Mallegowda as follows (at [20]-[22]): 20. Following Kermode, a s 26 defence could not be pleaded to a plaintiff's imputations, and was restricted to those imputations which a defendant pleaded which were different in substance. This has, unfortunately, resulted in increasingly convoluted contextual justification imputations, as defendants searched to find "different" imputations to plead contextually. The problem was that a plaintiff would then seek leave to "plead back" these imputations, leaving the defendant without the benefit, if such an application was granted, of no separate imputations to ground a s 26 defence. 21. It was against this background that courts began to refuse plaintiffs leave to do so (see Ahmed v Nationwide News Pty Ltd and Waterhouse v Age Co Ltd, supra). The basis for the argument that the plaintiff could not plead these imputations back is that case management, or delay, principles, mean that the plaintiff has to get the imputations right the first time, as McCallum J notes in Hall v TCN Channel Nine Pty Ltd [2014] NSWSC 1604, citing McMahon v John Fairfax Publications Pty Ltd [2010] NSWCA 307). In Waterhouse v Age Co Ltd, Nicholas J held that a plaintiff who failed to identify all the imputations had thereby disqualified himself from being able to rely upon any contextual imputation later pleaded by the defendant, no matter how short the delay or how obscure the contextual imputation, on the basis that the plaintiff had to get the imputations "right the first time, at risk of refusal to amend at a later time": Waterhouse v The Age Pty Ltd, citing Giles JA in McMahon at [49]. Given the difficulties of pleading imputations, and the absence of judicial guidance as to how a plaintiff is to identify every imputation available, this was a counsel of perfection, as well as being inconsistent with the right of any party to amend particulars and pleadings generally. 22. These convoluted pleadings in turn caused complexities at the trial level, as Mr Rasmussen noted, referring to trials in which he had appeared. It did not resolve the problem caused to defendants by the watering down of the defence; it simply added to the burden of the trial judge in determining how the jury should be addressed and in determining, when assessing damages, how to take into account different findings by the jury as to the success or failure of the imputations in question. 1. Those remarks acknowledge the potential unfairness of precluding a plaintiff from relying upon an imputation that has escaped the imagination of the pleader but which, upon being identified, the plaintiff wishes to embrace in the vindication of his or her reputation. 2. I am not persuaded that the plaintiff seeks to vindicate her reputation against the defamatory meanings captured in the defendants' contextual imputations. Indeed, in a tribute to the metaphysical agility required of practitioners in the field of defamation, Mr Rasmussen submitted, in the alternative to his application for leave to amend, that the contextual imputations should be struck out as being bad in form (contextual imputation A) or incapable of arising (contextual imputation B). This is not a case of visiting the plaintiff with the unfairness of a counsel of perfection, the vice illustrated in the remarks of Gibson DCJ. The plaintiff seeks leave to amend to plead imputations she eschews. I do not think the dictates of justice require me to allow that to occur. Application to have the reply struck out 1. The basis for the application to have the reply struck out was the absence of any satisfactory particulars to support it. During the course of argument, Mr Rasmussen in effect acknowledged that further particulars should be provided. In that circumstance I do not think it would be appropriate to strike out the pleading at this stage. Orders 1. For those reasons, I make the following orders: 1. The application for leave to amend the further amended statement of claim is refused. 2. The application to have the reply struck out is refused. ********** Amendments 10 March 2015 - Amendment to coversheet 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: 10 March 2015