Supreme Court New South Wales Medium Neutral Citation: Cowper v Fairfax Media Publications Pty Limited [2015] NSWSC 1000 Hearing dates: 22 July 2015 Date of orders: 22 July 2015 Decision date: 22 July 2015 Jurisdiction: Common Law Before: McCallum J Decision: Rulings on imputations Catchwords: DEFAMATION – pleadings – reliance on republication going to damages – whether fact of republication available as a matter of inference DEFAMATION – pleadings – imputations – capacity – requirement of precision in pleading – requirement of imputations to differ in substance Cases Cited: Bleyer v Google Inc [2014] NSWSC 897 Christiansen v Fairfax Media Publications [2012] NSWSC 1258 Dank v Whittaker (No 1) [2013] NSWSC 1062 Lewis v The Daily Telegraph Ltd [1964] AC 234 McCormick v John Fairfax and Sons (1989) 16 NSWLR 485 Palmer Bruyn & Parker Pty Ltd v Parsons [2000] NSWCA 53 Palmer-Bruyn and Parker Pty Ltd v Parsons [2001] HCA 69, 208 CLR 388 Webb v Bloch [1928] HCA 50; 41 CLR 331 Category: Procedural and other rulings Parties: Graeme Cowper (Plaintiff) Fairfax Media Publications Pty Limited (First Defendant) The Age Company Limited (Second Defendant) Adele Ferguson (Third Defendant) Ruth Williams (Fourth Defendant) Jeff Morris (Fifth Defendant) Representation: Counsel: K Smark SC with ST Chrysanthou (Plaintiff) ATS Dawson (Defendants) Solicitors: Kalantzis Lawyers (Plaintiff) Banki Haddock Fiora (Defendants) File Number(s): 2015/141763 Publication restriction: None Judgment – Ex Tempore 1. HER HONOUR: These are proceedings for defamation commenced by Mr Graeme Cowper against Fairfax Media Publications Pty Limited and a number of other defendants arising out of the publication of a series of articles in the Sydney Morning Herald and The Age newspaper. The proceedings have come before me today to determine the matters identified in Practice Note SC CL 4 for determination at the first listing. This judgment determines objections taken by the defendant to the form of the pleading. 2. The first objection relates to the first matter complained of, which is an e-mail exchange passing between the third defendant (Ms Adele Ferguson), a journalist and Ms Julia Quinn, the Director of Media and Community Relations at AMP. AMP is evidently the current employer of the plaintiff (or at least was as at the date of the e-mail exchange). 3. In short, the thrust of the exchange is that the journalist wrote to Ms Quinn seeking through her to make an enquiry of the plaintiff. The journalist summarised certain information she then held in relation to the plaintiff, stating she understood that his employment had been "terminated due to reconstruction of client files" and further stating: "We have a few victims of Cowper who have come forward and were compensated by NAB. We also have a former colleague of Cowper's who have (sic) made some allegations about him. We want to put a few questions to him given we will be naming him." 1. Ms Quinn's first response, evidently reflecting the seriousness with which she regarded that communication, was, "Oh dear." 2. The exchange continued with Ms Quinn asking the journalist to put questions to her which she would endeavour to have answered by Mr Cowper. The questions broadly reflected the kind of allegations set out in that opening e-mail, with further detail. 3. The dispute arising in respect of that exchange is that, in para 6(e) of the statement of claim, the plaintiff seeks to rely upon any republication of the content of the exchange by Ms Quinn to other persons within AMP. 4. The defendant alleges that the plaintiff has no specific factual basis for asserting that the exchange (or the substance of it) was indeed republished by Ms Quinn to any other person within AMP; it is an assertion which is made as a matter of inference. 5. In those circumstances Mr Dawson, who appears for the defendants, submitted that the allegation of republication cannot stand on the pleading, since it seeks damages for a publication the plaintiff cannot identify. Mr Dawson submitted that the assertion that the sense and substance of the e-mail exchange was republished by Ms Quinn is nothing more than a guess. 6. Mr Dawson referred to a number of cases in which he submitted pleadings had been struck out or otherwise disallowed in similar circumstances. He relied first on my decision in Bleyer v Google Inc [2014] NSWSC 897. In that case, the defendant sought to have a defamation action stayed or summarily dismissed as an abuse of process on the basis that there was "an obvious and substantial disproportion between the cost of the exercise and conceivable vindication". The plaintiff's claim was based on publication of extremely limited scope (three persons, each of whom must have undertaken a search on Google to find the matter complained of). The plaintiff argued that the application was premature and that he ought to be allowed to interrogate or have discovery in order to determine whether there had been any further publication. I rejected that argument, holding that, where the prospect of further and better particulars being provided after discovery and interrogatories was "necessarily speculative", the appropriate course was to determine the defendant's application on the pleadings and particulars as they stood (at [29]). 7. Mr Dawson also referred to my judgment in Dank v Whittaker (No 1) [2013] NSWSC 1062. That was a case in which two of the defendants sought to have the proceedings as against them dismissed. They had been sued as joint publishers of a newspaper article on the basis of the principles stated by the High Court in Webb v Bloch [1928] HCA 50; 41 CLR 331 in circumstances where their alleged involvement in the article was confined to the fact that certain quotes within the article had been attributed to them. The plaintiff submitted that the issue of those defendants' liability as joint publishers of the whole article was a matter for evidence at the trial and not a strike-out point, citing Thiess v TCN Channel Nine Pty Ltd (No 5) [1994] 1 Qd R 156 at 194. In considering that submission, I said, "to the extent that that passage was sought to be relied upon as authority for the proposition that it is not necessary to plead material facts to establish a basis for alleging that a person is liable as a joint publisher, the submission was misconceived", implicitly rejecting the proposition that the pleading could stand in the form in which it was against the prospect of further information being obtained by interlocutory processes (at [29] to [30]). 8. Each of those cases is very different from the circumstances of the present case. All the plaintiff seeks to do is to include within the scope of damage for which the defendants might be held liable any re-publication by Ms Quinn of the sense and substance of the e-mail. 9. The plaintiffs have provided particulars of that aspect of the claim in a letter dated 21 July 2015, relying on the identified position of Ms Quinn as Director, Media and Community Relations Public Affairs; the fact that in some of the e-mails she uses the first person plural (for example saying, "we tracked down Graeme") and the nature of the allegations made in the first matter complained of. Mr Smark SC, who appears with Ms Chrysanthou for the plaintiff, made a forceful submission as to the inherent unlikelihood of a person in Ms Quinn's position choosing not to communicate the content of the journalist's approach to persons within positions of authority at AMP. 10. Mr Dawson submitted that damages could not be sought on the strength of such an inference where there was nothing to sustain it, invoking the remarks of Gummow J in Palmer-Bruyn and Parker Pty Ltd v Parsons [2001] HCA 69, 208 CLR 388 as to the grape-vine effect (presumably a reference to his Honour's remarks at [89]). 11. Again, that was a very different case from the present, the question being whether there was sufficient evidence to support a conclusion that the plaintiff had lost a specific contract as a result of the assumed extent of re-publication of the matter complained of. 12. As I understood the position, Mr Dawson invoked those remarks to make the contention that it is not enough (in order to sustain an allegation of republication) to rely on the grapevine effect as if it were "a doctrine of law or phenomenon of life operating independently of evidence", to adopt the words of Heydon JA in the Court of Appeal in Palmer Bruyn & Parker Pty Ltd v Parsons [2000] NSWCA 53 at [37]. 13. Repeating those remarks, Gummow J said (at [89] in his judgment in the High Court) whether republication was probable must rely upon more than mere assertion of the grapevine effect and will turn on a variety of factors, "including the nature of the false statement and the circumstances in which it was published." 14. I do not think it is fair to characterise the contention of republication in the present case as a bare guess. The particulars provided in the letter to which I have referred provide ample basis to sustain the inference contended for and I think it would be wrong to strike that averment from the pleading at this point of the proceedings. I do not think the position is governed by the position I took in Bleyer v Google Inc or Dank v Whittaker (No 1). 15. Separately, the defendants objected to a number of the imputations pleaded by the plaintiff on the grounds of both form and capacity. 16. There was an objection that imputations 7(d) and (e) arising from the first matter complained of do not differ in substance but that was met by Mr Smark's concession that imputation 7(d) would be relied upon only as a fall-back to imputation 7(e). 17. An objection was taken to the form of imputation 7(e) by reason of its alleged ambiguity or imprecision. That imputation states: "The plaintiff had so misconducted himself as a financial planner, by giving inappropriate and aggressive financial advice based around excessive gearing, by failing to properly disclose commissions and by engaging in conflicts of interest, that his employer the NAB was obliged to compensate his clients." 1. The objection was confined to the inclusion of the words, "was obliged to." 2. Mr Dawson questioned whether that phrase meant that the National Australia Bank had been obliged by some external agency, such as the Court or ASIC, to make the compensation referred to or whether it simply meant that the NAB felt compelled to make compensation or effectively had no choice. I do not think there is any ambiguity in that imputation. As submitted by Mr Smark, the suggestion of an externally-imposed obligation is what Mr Smark referred to as a "ghost" imputation or at least, in rhetorical terms, "a straw man". It is not the meaning contended for and it is not what the words say. 3. In my view, the meaning of the imputation is clear and is to the effect that the NAB effectively had no choice in the circumstances and felt obliged to make the compensation. On that basis the imputation will stand on the pleading. 4. Imputation (f) is: "The plaintiff had so misconducted himself as a financial planner working for the NAB that a former colleague had made allegations about him." 1. In my view, the imputation in its current form is confusing. Mr Smark, I think, accepted that to be the case but sought leave to re-plead that imputation. Having considered the content of the exchange from which it is alleged to arise, I doubt whether any further imputation beyond those already pleaded could be gleaned from the discrete fact asserted by the journalist, "We also have a former colleague of Cowper's who have (sic) made some allegations about him." No different content is given to the allegations than is found in the balance of the matter complained of, already captured in the imputations pleaded. Accordingly, I would not be inclined to grant leave to re-plead that imputation. Having said that, a plaintiff is never foreclosed from bringing forward an application to amend a pleading. 2. The next objections relate to the second and third matters complained of, which are an article published in the Sydney Morning Herald and the online version of the same piece. 3. The first objection mirrors the objection to imputation 7(e) by reason of the inclusion of the phrase "was obliged to" in imputations 9 and 11(a). That objection is governed by my ruling in respect of imputation 7(e). 4. The second objection is to imputations 9 and 11(b): "The plaintiff, when a financial planner for the NAB, had forged documents." 1. The defendant objected that the imputation is not reasonably capable of being conveyed by the matter complained of. I do not agree. 2. I accept, as submitted (with the kind of force which will be useful before a jury) by Mr Dawson, that the matter complained of is effectively presented in two separate pieces: one which suggests generic allegations of forgery and other misconduct against a number of former NAB financial advisers and a second discrete and specific article relating to a particular woman's dealings with Mr Cowper, the plaintiff. The article dealing specifically with the plaintiff does not accuse him of forgery: that imputation could only be conveyed if he is attributed with the allegations in the generic article. 3. Mr Dawson reminded me in that context of the decision of Hunt J in McCormick v John Fairfax and Sons (1989) 16 NSWLR 485. That was a case in which, broadly speaking, an article stated that only one of three partners in a firm of private investigators was guilty of certain misconduct. His Honour held that an article which makes plain that only one of a class of three is guilty of the conduct described in the article is not reasonably capable of defaming each of the members of that class. Mr Dawson accepted that the present case is not on all fours with McCormick. This is not a case in which the article makes plain that only one person could be guilty of the conduct in question. 4. Separately, I would note that, in McCormick, as stated in the headnote, the principle stated by Hunt J was qualified by the remark (at 448.D): "and where there is nothing in that matter which points to any particular member of that group or class as the one who was so responsible." 1. I was also referred during argument to the decision of Nicholas J in Christiansen v Fairfax Media Publications [2012] NSWSC 1258. His Honour there expressed (at [29]) some doubt as to the correctness of Hunt J's decision in McCormick, or at least distinguished that decision from the matter before His Honour on the basis that in McCormick Hunt J was not concerned with imputations of suspicion as opposed to imputations of guilt. 2. In any event, I do not think either authority establishes a rule that is applicable in the present case. Indeed, in Christiansen, Nicholas J at [30] cited the remarks of Lord Devlin in Lewis v The Daily Telegraph Ltd where His Honour said (at 285): "One always gets back to the fundamental question: What is the meaning that the words convey to the ordinary man: You cannot make a rule about that." 1. The real question in the present case is whether the article is reasonably capable of pointing to Mr Cowper as a person who engaged in the dishonest conduct of forging documents referred to in the first piece. It may be accepted that the article does not in terms accuse Mr Cowper of forging documents but, in my view, there is enough in the whole of the material sued on to conclude that that is an issue which must be left to the jury. 2. The next objection is to imputations 9 and 11(d), that: The plaintiff had misconducted himself as a financial planner for the NAB by forging his clients' signatures and manipulating documents. 1. The argument was similar to the argument in respect of the forgery imputation in 9 and 11(b). For substantially the same reasons, I have concluded that that is also a question which must be left to the jury. 2. In particular, I would accept, as submitted by Mr Smark, that upon reading the two pieces together, the jury might well think that Mr Cowper, being the subject of the second article, is the worst of the financial advisers referred to in the first. His involvement as a prominent participant in the conduct described is emphasised by a front page photograph of him, completing what Mr Smark referred to as "the triad" of planner, victim and whistle-blower. The photograph shows him walking alongside a luxury car. I think the question of the extent of conduct attributed to him by the whole of the material sued on is a question for the jury. 3. Imputations 9 and 11(e) and (f) were objected to on the grounds that they do not differ in substance. Each alleges that the plaintiff gave inappropriate financial advice to Veronica Coulston, the difference being in the specification of the inappropriateness. One alleges the advice was inappropriate because Ms Coulston did not have the cash flow to support the financial strategy the plaintiff advised. The other alleges that the advice was inappropriate in that he advised her to borrow a further $20,000 to clear her credit cards which was an amount she could not afford to repay. In my view, the sting is the same. Those two imputations should be the subject of an election or else distilled in a new imputation, as to which the plaintiff should have leave to re-plead. 4. Imputations 9 and 11(h) were also included in the objection that it does not differ in substance from (e) and (f). In each case, the imputation is that: "The plaintiff, a financial adviser, had given such inappropriate advice to Veronica Coulston that she nearly lost her home." 1. In the case of that imputation I would accept, as submitted by Mr Smark, that there is a difference in that the consequence referred to is so catastrophic as to qualify the character of the conduct attributed to the plaintiff. That imputation will stand. 2. Imputations 9 and 11(i) were included within the objection on the grounds of the inclusion of the phrase "was obliged to" and will be governed by my ruling in respect of imputation 7(e). That is also the case in respect of imputations 13 and 15(a) and 17 and 19(b). 3. The only remaining objection is to imputations 13 and 15(c): That the plaintiff, as a financial planner for the NAB, had forged clients' signatures. 1. As with the previous forgery imputation, the burden of the objection was that the plaintiff is quarantined from the forgery allegation. Again, with a degree of ingenuity and displaying his considerable ability in the analysis of words, Mr Dawson submitted that the references to the plaintiff attribute specific conduct to him the effect of which is to carve him out of the general misconduct reported earlier in the article at paragraphs 18 and 19. 2. In my view, the arguments put by Mr Dawson reflect an application of the wrong test at this stage of the proceedings. The question is not whether, properly construing the article as if it were a statute, the wrongful conduct in the imputation can be seen to be quarantined from the references to the plaintiff by reference of more specific references to him elsewhere. It is a question ultimately of what the jury could reasonably make of the whole of the article. This article again includes a featured photograph of Mr Cowper, again next to his luxury vehicle. He is very much the emphasis of the article, and I think the question whether the forgery allegation is attributed to him should properly be left to the jury. 3. I direct the parties to bring in short minutes to give effect to these rulings. ********** 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: 29 July 2015