Barach v University of New South Wales

Supreme Court of NSW|2011-03-31|Before: Garling J

No appearance Solicitors: (P) Harmer's Workplace Lawyers (D1) Blake Dawson (D2-6) Banki Haddock Fiora (D7) Beazley Singleton Lawyers (D8) Banki Haddock Fiora File Number(s): 2010/136384

Dr Barach and his Claim: An Overview 1Dr Paul Barach is an anaesthetist by profession. In September 2008, he was appointed by the University of New South Wales as the director of the NSW Injury Risk Management Research Centre, for a period of five years. Whilst in that position, he acted as the Head of the School of Risk and Safety Sciences of the Faculty of Science at the University. 2On 23 June 2009, the University terminated the employment of Dr Barach. 3In 2010, Dr Barach commenced proceedings by a statement of claim filed in this Court against the University and seven other individuals. He claimed damages, and aggravated damages, for a variety of different defamatory publications made by the individuals, for whose publications he alleged the University was vicariously liable. 4Each of the publications referred in terms, which Dr Barach alleges were defamatory, to various issues about Dr Barach's background, qualifications and curriculum vitae, his capacity to manage funds of the NSW Injury Management Research Centre, and his capacity to be a director of that Centre. 5There are 17 separate matters said to be defamatory complained of in the statement of claim of Dr Barach. 6The present iteration of that claim is to be found in an amended statement of claim which was filed, by leave, on 14 July 2010. 7Attached to that amended statement of claim are two documents. The first is a letter dated 23 June 2009, written by Professor Richard Henry, the Deputy Vice-Chancellor (Academic) at the University, to Dr Barach. The second document is a paper copy of a Facebook notification from Michael Johnston to Elizabeth Godfrey, which contains a copy of an email said to have been sent by the applicant, Mr Karaka, who is the 7 th defendant in the proceedings, to Mr Johnston. 8It will be necessary to return to the contents of these documents in due course.

Mr Karaka 9Harold Karaka, is named as the 7 th defendant in the amended statement of claim. He is the applicant for a number of orders in the notice of motion which is to be determined by this judgment. 10The evidence establishes that: (a) Mr Karaka is a citizen of the United States of America; (b) he presently lives in the State of California in the USA; (c) he has only been twice to Australia. Both of those occasions were for a holiday. The last of those occasions was in about 1983; (d) his principal occupation is as a private investigator; (e) he earns a modest annual income. He owns no real estate and has no other assets of any significance. 11Mr Karaka said in his affidavit that he could not afford the cost of retaining lawyers in Australia, and he could not afford the cost of travelling to Australia to defend himself in the proceedings brought by Dr Barach. 12The email which he sent, which is reproduced in the second document attached to the amended statement of claim, provides this description of who is and what he was doing. It says: "I am a private investigator and I represent the University of New South Wales (UNSW) located in Sydney, Australia. I am conducting a background investigation on behalf of the University on Dr Barach due to his recent firing from the institution." 13It seems to be an entirely accurate description.

The Claim by Dr Barach against Mr Karaka 14Dr Barach claims that Mr Karaka defamed him on three separate occasions. They are said to be: (a) in September 2009, Mr Karaka sent an email to Mr Michael Johnston in Florida, in the USA, by sending it to Mr Johnston's Myspace site ("the 14 th matter complained of"). Dr Barach alleges that the email was republished by Mr Johnston to Ms Godfrey in the State of New Hampshire in the USA. Dr Barach also alleges, in a letter of particulars, that there was another republication to a recipient in Sydney; (b) in September 2009, Mr Karaka had a telephone conversation with Ms Ruth Kamar, Dr Barach's former wife, who at that time lived in and was located in Israel ("the 15 th matter complained of"); (c) in September 2009, Mr Karaka had a telephone conversation with Professor Joe Wolfson at the University of South Florida, in the State of Florida in the USA ("the 17 th matter complained of"). I should note that the pleading uses the name Wilson rather than Wolfson. The evidence satisfies me that this is a typographical error, and the name of Wolfson should be read for Wilson. 15Although each of the allegedly defamatory publications relied upon by Dr Barach and his claim against Mr Karaka are in different terms, they all relate to the termination of Dr Barach's employment with the University, the circumstances surrounding his first obtaining a position at the University and his conduct whilst an employee. All of the defamatory publications are said to have occurred, in the course of Mr Karaka's retainer as a private investigation agent by the University, when he was enquiring into these matters. 16Many of the imputations which are pleaded with respect to the 14 th , 15 th and 17 th matters complained of, are in very similar terms to the imputations pleaded as arising from the other 14 defamatory publications relied upon in the amended statement of claim. 17Dr Barach complains that all 17 of the defamatory publications, including the three pleaded against Mr Karaka, have caused him to suffer loss and damage, including: (a) the hurt, humiliation and embarrassment of a kind typically claimed in defamation actions; (b) the destruction of his valuable national and international reputation with the result that he has been refused employment at a number of universities, and has had significant research projects withdrawn; and (c) the destruction of his earning capacity. 18He does not seek to particularise any individual head of damage as having resulted from any one publication. Rather, he attributes the undivided totality of his loss and damage to each of the publications, and inferentially, to all of the publications. 19Some features of the other 14 defamatory publications which are joined in the amended statement of claim can conveniently be noted: (a) They all took place in Australia; (b) The subject matter related to Dr Barach's employment with the University and the circumstances giving rise to the termination of his employment; (c) The individual defendants were each employees of the University at the time the defamatory publications were allegedly made; (d) The University was said to be vicariously liable for the defamatory publications, because each of the individual defendants was acting in the course of their employment in publishing the defamatory words; (e) Each of the defamatory publications are said to have been made either to a single person, or else a small number of people. In some of the publications, there is a claim for damages for republication. 20The amended statement of claim was served appropriately on all defendants, except for Mr Karaka the 7 th defendant. It was not possible to effect personal service on Mr Karaka. 21On 22 September 2010, on the application of Dr Barach, orders were made by the Court which provided for substituted service of the proceedings on Mr Karaka. 22The amended statement of claim came to the notice of Mr Karaka as a consequence of Dr Barach complying with those orders for substituted service. 23Mr Karaka, filed a notice of motion on 21 October 2010. This did not amount to submission to the jurisdiction. This judgment deals with the issues raised by that notice of motion.

Notice of Motion of 21 October 2010 24By his notice of motion, Mr Karaka seeks four main orders. They are: (a) pursuant to r 12.11(b) of the Uniform Civil Procedure Rules 2005, service of the originating process on the 7 th defendant be set aside; (b) pursuant to r 12.11(g) of the UCPR, the Court declares that it has no jurisdiction over the 7 th defendant, in respect of the subject matter of the proceedings; (c) in the alternative, pursuant to r 12.11(h) of the UCPR, the Court declines to exercise jurisdiction in the proceedings against the 7 th defendant; (d) in the alternative, in the Court's inherent jurisdiction in the proceedings, the proceedings against the 7 th defendant be permanently stayed. 25It will be necessary to consider each of these in turn, but it will be convenient to first set out the applicable parts of the UCPR 2005.

Uniform Civil Procedure Rules 2005 26Part 12 of the UCPR, in Division 4, makes provision for various applications dealing with service and hearing of proceedings which can be made by a defendant without submitting to the jurisdiction of the Court. 27Part 12.11 is relevantly, in the following terms: "12.11 Setting aside originating process etc (1) In any proceedings, the court may make any of the following orders on the application of a defendant: ... (b) an order setting aside the service of the originating process on the defendant, ... (g) an order declaring that the court has no jurisdiction over the defendant in respect of the subject-matter of the proceedings, (h) an order declining to exercise jurisdiction in the proceedings, (i) an order granting such other relief as the court thinks appropriate. (2) Such an order may not be made unless notice of motion to apply for the order is filed by the defendant within the time limited for the defendant to enter an appearance in the proceedings. (3) Notice of motion under subrule (2): (a) may be filed without entering an appearance, and (b) must bear a note stating the applicant's address for service. (4) The making of an application for an order under subrule (1) does not constitute submission to the jurisdiction of the court." 28Although Mr Karaka relies only on the provisions of Part 12, the terms of r 11.7 of the UCPR are also relevant. That rule is in this form: "11.7 Setting aside originating process served outside Australia (1) The Supreme Court may make an order of a kind referred to in rule 12.11 (Setting aside originating process etc) on application by a defendant on whom originating process is served outside Australia. (2) Without limiting subrule (1), the Supreme Court may make an order under this rule: (a) on the ground that the service of the originating process is not authorised by these rules, or (b) on the ground that the court is an inappropriate forum for the trial of the proceedings." 29In light of the terms of r 11.7 and the submissions, some parts of Schedule 6 of the UCPR are also relevant. Schedule 6 sets out the requirements which must be met in proceedings so that the Court's long arm jurisdiction can be exercised. They are: "... (e) if the proceedings, wholly or partly, are founded on, or are for the recovery of damages in respect of, damage suffered in New South Wales caused by a tortious act or omission wherever occurring, ... (i) if the proceedings are properly commenced against a person served or to be served in New South Wales and the person to be served outside New South Wales is properly joined as a party to the proceedings, ..."

The Issues 30There are three principal issues raised by the arguments of Mr Karaka on the motion. They are: (a) Was the service of the process authorised by the UCPR - see r 11.7(2)(a); (b) Is the Supreme Court of NSW an inappropriate forum for the trial of the proceedings - see r 11.7(2)(b); and (c) Does the claim against Mr Karaka have insufficient prospects of success to warrant putting him to the time, expense and trouble of defending the claim. 31It is appropriate now to turn to each of these issues:

Was Service Authorised by the UCPR? 32Service of originating process outside Australia for proceedings commenced in this Court is authorised, providing that one of the circumstances referred to in Schedule 6 of the UCPR exists: r 11.2(1) UCPR. 33There are two bases upon which Dr Barach claimed that the UCPR authorised service. He submitted that: (a) he suffered and continues to suffer damage in NSW and therefore these proceedings fall within clause (e) of Schedule 6 of the UCPR; and (b) Mr Karaka is properly joined as a party to the proceedings and there is another party (here, seven other parties) each of whom were served in NSW and therefore clause (i) of Schedule 6 of the UCPR applies. 34Mr Karaka attacks each of these bases. 35In considering the issue of whether the proceedings fall within any of the clauses in Schedule 6, what is to be examined is the pleadings. 36Gaudron, McHugh, Gummow and Hayne JJ said in Agar v Hyde (2000) 201 CLR 552 at 573 [50]: "... The paragraphs speak of 'proceedings [which] are founded on' a specified matter such as a cause of action arising in the State or a tort committed in the State. That focuses attention upon the nature of the claim which is made. That is, is the claim a claim in which the plaintiff alleges that he has a cause of action which, according to those allegations , is a cause of action arising in the State?" 37Accordingly, the analysis which follows is conducted by a careful examination of the pleadings. Such explanation of the pleadings as may be given by affidavit as part of the evidence needs to be examined separately and carefully, keeping in mind the remarks in the preceding paragraph. 38Therefore, the first question is whether in the amended statement of claim there is a claim, based upon proper pleadings, that Dr Barach has suffered damage in NSW. 39Although the pleading at paragraph 93 of the amended statement of claim could be more specific, it seems to encompass the suffering of damage by Dr Barach at least in NSW as well as elsewhere. The pleading does not specifically nominate damages as occurring in any one geographical location. 40I reach that conclusion because, having regard to the fact that Dr Barach was employed in NSW, and was and still is, resident in NSW, the pleading which alleges that he has suffered hurt, humiliation and embarrassment, his reputation has been harmed, his earning capacity has been destroyed and his "valuable national reputation" has been destroyed, when appropriately considered is to be taken in the absence of any reference to any other specific geographical location, as referring to NSW. Certainly, his feelings of hurt and humiliation would only be felt where he was personally resident. 41It is clear that the whole of the damages claim is not limited to NSW because Dr Barach claims that his "international reputation" has been destroyed. But the provisions of clause (e) of Schedule 6 of the UCPR do not require exclusivity of damage in NSW. That is because of the use of the phrase "... wholly or partly ... " in the clause. This phrase clearly suggests that only part of the damage which has occurred needs to take place in NSW for the clause to be applicable. 42Mr Karaka submits that, notwithstanding the terms of paragraph 93 of the amended statement of claim, having regard to the facts and circumstances pleaded as giving rise to the defamatory imputations, from the 7 th defendant's publications, the Court ought be satisfied that no damage has occurred in NSW from the 7 th defendant's alleged defamation. 43There are two essential bases for this submission, namely: (a) the publications which were all single person publications, all wholly occurred outside NSW; and (b) the nature of the damage by way of hurt to feelings and humiliation, which must have been suffered outside NSW, meant that no other damage was suffered within NSW. 44The first of these two bases, leaving aside the possibility of a republication of the 14 th matter complained of in Sydney, is unquestionably correct, and was the accepted position of both of the parties to the motion. 45The second basis is rather more complex. Mr Karaka submits that the relevant damage in actions for defamation is injury to reputation, which is suffered only where the tort is committed. His submission continues: "17. To the extent ... that the relevant 'damage suffered in New South Wales' is the plaintiff's hurt to feelings which he suffered [in NSW] upon learning of the alleged publication of the ... matters complained of, that submission should be rejected. It assumes that hurt to feelings are in some way severable in an action for defamation from injury to reputation. Plainly, they are not. The hurt to feelings which are compensable in proceedings for defamation, are inextricably limited to and arise from the relevant injury to reputation." 46I do not accept this submission as a sufficient basis to demonstrate that the plaintiff has not suffered any damage within NSW. 47Although the rationale of the test of defamation is the protection of reputation, compensatory damages which are awarded are not limited only to damage to reputation, because they are at large and may include more than one kind of compensation. Damages can include compensation for actual or anticipated pecuniary loss, as well as compensation for injury to feelings including any grief or distress which a plaintiff may have felt upon learning of the defamatory publication: McCarey v Associated Newspapers Ltd (No. 2) [1965] 2 QB 86 per Pearson LJ at 104. Compensatory damages are the award of the Court to compensate a plaintiff for the damage suffered from the defamatory publication. That damage includes all of the matters for which compensation can properly be awarded. 48As well, as I have earlier said, the law has long recognised that vindication of the plaintiff in an essential part of the remedy in a defamation action: Blackstone, Commentaries On the Law of England , 15 th ed (1809) vol 3 at 126. 49Put another way, general damages serves these functions: to act as a consolation to the claimant for the distress which he suffers from the publication of the statement, to repair the harm to his reputation, and as a vindication of his reputation: Carson v John Fairfax & Sons Ltd (1993) 178 CLR 44. 50It may be relevant to the size of an award of damages that there has been only a limited publication, although publications to a single person, including the spouse (or former spouse) of a claimant is adequate to ground an award of damages: Pullman v Walter Hill & Co Ltd [1891] 1 QB 524; Watt v Longsdon [1930] 1 KB 130. 51The submission of Mr Karaka fails to have regard to the multi-faceted nature of damages, and the importance of compensation for hurt to feelings. I have been provided with no authority to support the proposition that hurt to feelings (which is a form of damage) needs to be geographically located where the defamation occurs, or where the injury to reputation occurs. The hurt will at least be felt by a claimant wherever they happen to be when they first learn of the publication. The submission is contrary to principle and must be rejected. 52To avoid any doubt from the lack of clarity of the pleadings about the geographical location of the damage, counsel for Dr Barach relied on an affidavit of his client which asserted at [6]: "The damages alleged in paragraph 93 of the amended statement of claim were suffered, and are being suffered, by me primarily in the State of New South Wales." 53This statement, in the form in which it appears, is entitled to very little weight. It does serve to confirm that which I have inferred from the contents of the amended statement of claim. 54Nevertheless, as I have said above, it seems to me that the pleading sufficiently makes it plain that damage, of some kind, has occurred in NSW. On that basis, I have concluded that service would be authorised by clause (e) of Schedule 6 of the UCPR. 55The second basis upon which service is said to be authorised is that Mr Karaka, was properly joined as a party to the proceedings, together with other parties who were properly served in NSW: See clause (i) of Schedule 6 of the UCPR. 56Rule 6.19 of the UCPR provides that two or more persons may be joined as defendants in any originating process and so proceedings would be "properly commenced" if: "(a) separate proceedings by or against each of them would give rise to a common question of law or fact; and (b) all rights of relief claimed in the originating process are in respect of, or arise out of, the same transaction or series of transactions, or if the court gives leave for them to be joined." 57The question which falls to be determined is whether there are common questions of law or fact, or both, which arise in the proceedings so that it is appropriate to have joined Mr Karaka as the 7 th defendant. The comparison to be made is that necessary to establish sufficient commonality between the 14 th , 15 th and 17 th matters complained of and the balance of the matters complained of in the amended statement of claim. 58I have earlier observed that both the University and Mr Karaka are sued with respect to the 14 th , 15 th and 17 th matters complained of. It is obvious that in order to establish the liability of the University to him in damages, Dr Barach will need to establish that Mr Karaka made the relevant publication, that they were defamatory and the publication caused or materially contributed to the damages which he claims. All of those questions, which are of fact and law, will be common to the proceedings against the University and Mr Karaka. In addition, questions as to the liability of the University from the conduct of Mr Karaka, will involve questions of fact which are common to proceedings against Mr Karaka himself. 59Mr Karaka did not specifically address any submission to the question of whether, as between the 14 th , 15 th and 17 th matters complained of on the one hand, and the balance of the defamatory publications on the other, there were any common questions of fact or law. In my opinion, there are some common questions of fact and law raised in the pleadings. Those common questions include matters relating to damages, including the causal effect of each of the defamatory publications with respect to the injury to reputation, and the non-economic and economic aspects of the defamation alleged to arise. 60Rule 6.19 of the UCPR accordingly permits his joinder, and thus the proceedings are properly commenced against him.

Conclusion 61I am satisfied that the service of the amended statement of claim on Mr Karaka was authorised by the UCPR. 62Mr Karaka's submissions to the contrary must be rejected.

Is the Supreme Court of NSW an Inappropriate Forum for the Trial? 63Both parties proceeded upon the basis that the principles applicable to the consideration of whether the Court was an inappropriate forum in accordance with r 11.7(2)(b) of the UCPR were those stated by the High Court of Australia in Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538. 64The principles are referred to in the judgment of Mason CJ, Deane, Dawson and Gaudron JJ at 564 where it was said: "It follows that, subject to the question of onus ..., the principles to be applied in applications to set aside service and in applications for a stay on inappropriate forum grounds are those stated by Deane J in Oceanic Sun [(1988) 165 CLR 197 at 247-248]." 65It is as well to examine what Deane J said in Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197 at 248. He said, in identifying, in summary form, the modern content of traditional principles governing the power of the Court to order that proceedings be dismissed or stayed on inappropriate forum grounds, this: "The power should only be exercised in a clear case and the onus lies upon the defendant to satisfy the local court in which the particular proceedings have been instituted that it is so inappropriate a forum for their determination that their continuation would be oppressive and vexatious to him. Ordinarily, a defendant will be unable to discharge that onus unless he can identify some appropriate foreign tribunal to whose jurisdiction the defendant is amenable and which would entertain the particular proceedings at the suit of the plaintiff. Otherwise, that onus will ordinarily be discharged by a defendant who applies promptly for a stay or dismissal if he persuades the local court that, having regard to the circumstances of the particular case and the availability of the foreign tribunal, it is a clearly inappropriate forum for the determination of the dispute between the parties. The reason why that is so is that, once it is accepted that the adjectives 'oppressive' and 'vexatious' are not to be narrowly or rigidly construed and are to be applied in relation to the effect of the continuation of the proceedings rather than the conduct of the plaintiff in continuing them, the continuation of proceedings in a tribunal which is a clearly inappropriate forum would, in the absence of exceptional circumstances being established by the plaintiff ... be oppressive or vexatious to such a defendant if there is some available and appropriate tribunal in another country. ... [T]he mere fact that a tribunal in some other country would be a more appropriate forum for the particular proceedings does not necessarily mean that the local court is a clearly inappropriate one." 66The test in Voth and Oceanic Sun derives from the common law. 67In applying that test to the phrase used in the UCPR (and earlier identical forms of the rule) which is "... inappropriate forum ... " rather than "... clearly inappropriate forum... ", a possibility that there may be a difference, was identified, but not decided, in the judgment of Gaudron, McHugh, Gummow and Hayne JJ in Agar at [55]. 68The matter fell for further consideration in Regie Nationale Des Usines Renault SA v Zhang (2002) 210 CLR 491 where the plurality judgment, Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ said with respect to an earlier, but identical form of the rule presently being considered, at [24]-[25]: "[24] The expression 'inappropriate forum' in par (b) of Pt 10, rule 6A(2) is less emphatic than the expression 'clearly inappropriate forum', the latter being the term adopted in Voth to determine whether an Australian court should decline to exercise its jurisdiction. ... [25] Because a court's power to stay proceedings is an aspect of its inherent or implied power to prevent its own processes being used to bring about injustice, the same concepts and considerations necessarily inform the test of 'inappropriate forum' in [the rules] as inform the 'clearly inappropriate' forum test adopted in Voth . And because the ultimate consideration is the prevention of injustice, they inform it in the same way." 69It therefore accorded with authority to apply the "clearly inappropriate" test and the principles developed by courts to the application of the UCPR in this case. The parties' approach to this question in this litigation, accorded with the approach, as well as the approach adopted by Hammerschlag J in a most lucid exposition of these principles, if I may respectfully say, in Global Partners Fund Ltd v Babcock & Brown Ltd (in liq) [2010] NSWSC 270. 70The onus of proving to the Court that it is a clearly inappropriate forum for the hearing of the proceedings rests on the 7 th defendant, who is the applicant: See r 11.7(2)(b) of the UCPR, Voth at 589-590 per Toohey J, Oceanic Sun at 248 per Deane J. 71The 7 th defendant submits that the Court is a clearly inappropriate forum in reliance on each of, and the combination of, these factors: (a) the Court when hearing the proceedings on the three defamatory publications which relate to him, would be applying a foreign law, either that or the States of California, Florida or New Hampshire in the United States of America, or else the law of Israel; (b) there are in each of the states of the USA, courts which can hear and determine the plaintiff's claims. As well Israel, it is submitted, has an accessible judicial system which would be available to grant relief to the plaintiff; (c) the tenuous connection, if any, of the plaintiff's proceedings against the 7 th defendant with NSW as the forum; (d) Mr Karaka's geographical location and his financial circumstances; (e) the effect on the proceedings of the legislation passed in 2010 by the US Congress, namely the Speech Act , 28 USC 4101-4105 (2010). The Act was passed by the Congress in 2010. 72Dr Barach in response to those submissions points to the following connecting factors as indicating that the Court is clearly not an inappropriate forum: (a) the plaintiff and the other personal defendants are all residents of NSW; (b) the University is incorporated by an Act of the Parliament of NSW, namely, the University of New South Wales Act 1989, and is sought to be held vicariously liable for the conduct of Mr Karaka; (c) the subject matter of the proceedings is the employment and termination of the employment of Dr Barach which occurred in NSW and relates to matters occurring in NSW: (d) the engagement by the University of Mr Karaka was for the purpose of assisting it with its dispute with Dr Barach which was to be determined in one way or another in NSW; (e) the plaintiff has regularly and properly invoked the jurisdiction of the Court, and proceedings have been properly commenced, and served, against the other parties who were served in and are located in NSW; (f) one of the defamatory publications (14 th matter) was claimed to have resulted in a republication in NSW, damages are claimed to have been suffered in NSW and there is a large measure of overlap between all of the imputations which are pleaded to arise based on publications in NSW; (g) If the truth or falsity of any of the imputations alleged against the 7 th defendant becomes an issue, witnesses relevant to both of those issues will in all likelihood be resident in NSW; and (h) Australian law will be relevant to the claims against Mr Karaka, at least in respect of the issues of agency and vicarious liability.

Foreign Law 73In considering the submissions about the role which foreign law may play in determining whether this Court is a clearly inappropriate forum it is necessary to commence with the proposition that the choice of law principles which are applicable are those of the forum: Zhang at [67] per Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ; 74In accordance with Australian choice of law rules, in respect of torts which arise outside of Australia, the applicable law is the lex loci delicti : Zhang at [75]. 75In its application to this case, that principle means that the relevant substantive law for each of the defamatory publications involving the 7 th defendant would, in accordance with the principles enunciated in Dow Jones & Co Inc v Gutnick (2002) 210 CLR 575, be these: (a) 14 th matter complained of: The law of Florida, and for the pleaded republication, the law of New Hampshire. If the particularised republication is proved, then the law of NSW will apply to that republication; (b) 15 th matter complained of: The law of Israel; and (c) 17 th matter complained of: The law of Florida. 76No doubt different choice of law provisions applied in a different jurisdiction may lead to a different result. An example is to be seen in the evidence of Mr Harry Melkonian, an expert in the law of the USA, who says in paragraph 11 of his affidavit of 28 January 2011, that in the USA the "... place of injury generally supplies the choice of law ". I take from this that the choice of law rules which apply are not those of the forum but rather those of the lex causae . In addition, he notes that where there are two places of injury in defamation, in other words, the same publication has happened in two jurisdictions, the law of the place of the greatest injury will apply. That is not relevant to the issues which I need to consider, because in accordance with principle, the forum determines the choice of law provisions. 77It is clear that in order to hear and determine the claims against the 7 th defendant, this Court will need to apply the foreign law which is the lex loci dedicti . In this case, when considering only the causes of action against the 7 th defendant, and vicariously the 1 st defendant, the Court will also need to apply Australian law. That is because the issue of whether the University is vicariously liable for the conduct of Mr Karaka will need to be determined by the common law of Australia. 78It will be a matter for this Court to interpret the contract between the University and Mr Karaka, and all of the relevant facts and indicia to determine whether the University is liable for the defamatory publications: see Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at [36] and [42] per Gleeson CJ, Gaudron, Gummow, Kirby and Hayne JJ. 79The law relating to the existence of vicarious liability of the University for the conduct of Mr Karaka which is to be applied will be a substantive and not procedural one. As it seems to me, and it was not submitted otherwise, that law will be the law of Australia. 80As a general proposition, this Court cannot be a clearly inappropriate forum merely because it is required to apply foreign law in the determination of the proceedings: See Zhang at [81]. 81The fact of foreign law being part of the matrix to be applied, does not in this case either make the Court clearly inappropriate as a forum, nor does it, in my assessment, add any weight to the determination of that question when considered with all of the other features of the case, and in particular the fact that the application of Australian law will always be a part of the proceedings wherever they are heard.

Alternative Forums 82Mr Karaka next submitted that the fact that there are alternative forums in which the plaintiff could bring his claims points to the Court being a clearly inappropriate forum. 83The availability of relief in a foreign forum will always be a relevant factor in deciding whether or not the local forum is a clearly inappropriate one: Voth at 558 per Mason CJ, Deane, Dawson and Gaudron JJ. 84Here the evidence of Mr Melkonian demonstrates that the courts of the States of California and Florida provide an alternative forum. I would be prepared to infer that a court of New Hampshire would be in a like position. Because Mr Karaka is a resident of California, the courts of that State which have personal jurisdiction over him are able to apply the laws of other states of the USA, if appropriate, as the substantive law of the defamatory publication. To that limited extent, the courts of California would be applying foreign law. As well as the other States, the courts of the State of California would be a suitable alternative forum. 85There was no evidence led about the availability of a suitable forum for hearing the 15 th matter complained of in the courts of Israel. However, I would be prepared to take it, as a matter of judicial notice, that there is such a forum and that it would have jurisdiction to hear and determine the 15 th matter complained of. 86But as the plurality judgment in Voth points out at 559, there are good and powerful reasons why I ought refrain from making any qualitative assessment of the appropriateness of any of these foreign tribunals and concentrate upon: "... the inappropriateness of the local court of which the local judge will have both knowledge and experience than to a test which focuses upon the appropriateness or comparative appropriateness of a particular foreign tribunal of which he or she is likely to have little knowledge and no experience". 87As well, the plurality judgment at 560 said: "In deciding whether to grant or refuse a stay, the court does not, indeed cannot, evaluate the justice or relative merits of the substantive laws of the available forums (including the chosen forum). Consequently, the argument rests on a limited notion of the interests of justice arising from balance of convenience factors which, though relevant, have never been regarded as decisive." 88In the particular circumstances here, the fact that there are other available forums does not carry much weight, if any, in determining that this Court is a clearly inappropriate forum.

Tenuous Connection with NSW 89It is obvious that the relevant defamatory publications which relate only to Mr Karaka do not have any direct connection with NSW. They were not published by a person in NSW, nor were they published to a person in NSW. But they were published about Dr Barach, a resident of NSW, and their subject matter consisted of facts and circumstances which all occurred in NSW. 90I would not describe, as the submissions of the 7 th defendant do, the connection as a tenuous one. Nor would I describe it as a slight one. It is a real, but indirect, connection. 91But, when added to the fact that: (a) Dr Barach is a resident of NSW; and (b) the University is also sued for the same publications upon the basis that it is vicariously liable for the publications of the 7 th defendant; there seems to me to be an entirely adequate connection with the causes of action and NSW, and therefore this Court. 92I do not think that the extent of the connection with this jurisdiction is as tenuous as Mr Karaka submits, nor do I think that it makes this Court a clearly inappropriate forum. On the contrary, the connection, such as it is, satisfies me that the forum is an appropriate one.

Mr Karaka's Personal Position 93The unchallenged evidence is that the financial resources of Mr Karaka are very limited. He has a modest income and no assets of any significance. 94Clearly, there is a real cost to him in travelling to Australia for a hearing, and there would be a real cost to him in instructing lawyers to appear on his behalf. I accept that these difficulties would be far less if the claims of the plaintiff were to be heard in the State of California, where Mr Karaka lives. There he would not have the expense of travelling and he could appear for himself without legal representation should he choose so to do. If however the forums in which he was sued were any of the other states within the USA of which mention has been made, then he would incur some but not nearly as much, expense for travelling to those States, when compared with travelling to Australia. 95If proceedings were commenced in the courts of Israel, then in so far as Mr Karaka's personal position is concerned, the position of his costs and expenses would be similar to that which obtains for the courts of Australia. 96However, the geographical disadvantage to Mr Karaka of the proceedings being litigated in this Court, has to be considered in the context of the fact that the plaintiff himself lives in NSW, and the other relevant defendant, the University, is located in NSW. There is no evidence at all of the financial means, including either income or assets, of the plaintiff. 97In the absence of such material, I am not prepared to infer that travelling to the USA in order to appear in any proceedings or instructing attorneys in USA is an unreasonable burden upon him. Clearly the University is not financially disabled from conducting litigation in the USA if proceedings were brought there. 98However, regardless of the financial abilities of each of the plaintiff and the University to deal with litigation in the USA, it is clear that for them to conduct litigation in that country, they would incur additional expense compared with conducting the litigation in Australia. 99The factor, namely the financial circumstances of the 7 th defendant, considered on its own, falls in favour of the forum of NSW being an inappropriate one from the perspective of the 7 th defendant, but not from the perspective of the plaintiff and the 1 st defendant. But the extent to which this factor may be able to be addressed to satisfactorily remedy any disadvantage is relevant. It will be necessary to return to this in due course.

The Speech Act (USA) 100Mr Karaka submits that the relatively recent passage into law in the USA of the Speech Act (USA) significantly affects the utility of foreign courts determining defamation claims against US citizens, and therefore makes this Court a "clearly inappropriate" forum. 101The long title of the Act is the "Securing The Protection of Our Enduring and Established Constitutional Heritage Act ". The Act is intended to ensure that US citizens have the protection of the rights created by the First Amendment to the US Constitution with respect to their publications regardless of the location in which those publications may occur. The Act makes it explicit that it intends to protect US citizens against the (apparently) increasingly common occurrence of foreign libel judgments against US citizens which are inconsistent with US First Amendment provisions. 102The First Amendment to the US Constitution is in these terms: "Congress shall make no law respecting the establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or of the right of the people peaceably to assemble, and to petition the Government for a redress of grievances." 103The effect of the Speech Act in practice is sufficiently summarised for the purpose of this motion in the evidence of Mr Melkonian in this way: "12 Since 1964, when the US Supreme Court decided New York Times v Sullivan 3 76 US 254 (1964) there is not a single reported State or federal decision in which a foreign defamation judgment has been recognised and enforced. Now, with explicit Federal statutory law in the Speech Act, the possibility of recognition of foreign judgments is even more remote. An unsuccessful application by a defamation plaintiff to enforce a foreign defamation judgment will also result in mandatory award of attorneys' fees to the American party. 13 The Speech Act also provides Americans with broad rights to seek declaratory judgments directed against foreign defamation judgments for the purpose of declaring such judgments to be nullities under American law. 28 USC 4104(a). 14 Under the terms of the Speech Act, a foreign defamation judgment must be denied recognition unless the foreign law meets or exceeds US and State guarantees of freedom of speech. If the foreign law differs from the First Amendment and the plaintiff maintains that the result would have been the same even if First Amendment law applied, then, under the Speech Act, the foreign judgment may be recognised only if plaintiff proves in an American court that he would have prevailed under American law. 28 USC 4102(a)(1)(B). 15 In short, the plaintiff must effectively re-try the entire case in the US to enforce a foreign judgment . Plaintiff bears the burden of proof and risks imposition of attorney's fee award if he fails. On the other hand, if a plaintiff commences an original defamation action in the US and loses, attorney's fees are not awarded." (Emphasis added) 104In short, even if Dr Barach obtains a judgment against Mr Karaka in these proceedings, it cannot be registered as such for enforcement in the USA unless there is a further trial which will determine whether Dr Barach would have prevailed in his claim against Mr Karaka in accordance with the laws of the USA. 105The question then is whether the difficulty, or impossibility, of enforcement of any judgment obtained in this Court, in so far as enforcement is sought to take place in the USA, means that this Court is clearly an inappropriate forum for the hearing and determination of these proceedings. 106I do not think that it is a factor which has that consequence in this case. There are a number of reasons for this: (a) Dr Barach is entitled to regard the fact that he has obtained a judgment from this Court as vindication of his reputation, whether or not he chooses to enforce the monetary judgment and collect any award of damages from Mr Karaka. To that extent, the Speech Act (USA) is irrelevant; (b) The limitation on enforcement exists only if the judgment is sought to be enforced in the USA. The limitation does not apply to enforcement of a judgment in other countries, such as Canada or the United Kingdom, to which Mr Karaka may travel or else in which jurisdiction he may acquire assets at some time in the future; and (c) Dr Barach's claim for damages for the 14 th , 15 th and 17 th matters complained of is also made against the University. Hence he may prefer as a matter of choice to collect the award of damages, should one be obtained, from the University. This does not mean however that the judgment against Mr Karaka is an inappropriate one to obtain nor does it mean that this Court is a clearly inappropriate forum.

Summary 107Whilst each of these factors are appropriate, as I have discussed, to consider, the only factor which stands out in favour of this Court being clearly inappropriate forum is the financial position of Mr Karaka. 108The test of which I have to be satisfied is whether the continuation of the proceedings in the Supreme Court of NSW would be oppressive and vexatious to the 7 th defendant? 109I am not satisfied that this has been established. The nature of these proceedings is such that, I accept, additional expense will be incurred by Mr Karaka to meet the claims in the courts of NSW, than if he were to be sued in one of the state courts in the USA, although not if he were sued in Israel. 110However, the nature of the causes of action relied upon by the plaintiff involve transnational conduct. Similar considerations will apply in whatever forum is chosen. Mr Karaka, when he was retained by the University to undertake investigations accepted that his investigations concerned the conduct of Dr Barach with respect to his employment at the University. He accepted that he was retained to undertake investigations which would be used in NSW. That was part of the commercial risk which he undertook in accepting the retainer. He was free to refuse the retainer if he so chose. 111That he might therefore be put to additional expense by reason of Australian litigation to meet claims against him arising out of that retainer does not seem to me to mean that the proceedings against him are oppressive and vexatious. 112As well, if he regards the cost and expense as excessive Mr Karaka may choose to approach his defence to the allegations by not participating in the proceedings in Australia, and relying upon the procedure fixed by the Speech Act (USA) as being essential before any judgment can be enforced against him in the USA. As Mr Melkonian explains at [15]: "In short, the plaintiff must effectively re-try the entire case in the US to enforce a foreign judgment." 113In light of the provisions of the Speech Act (USA) Mr Karaka will be at no disadvantage in meeting the claims of the plaintiff by waiting until the plaintiff attempts to enforce that judgment, where he can meet the claim on the same basis, as if he had been sued in the USA. 114In short, such inconvenience and additional expense as Mr Karaka faces, can be addressed in a way which minimises any additional cost and expense. 115In those circumstances I am not persuaded that the continuation of these proceedings would be oppressive or vexatious.

Insufficient Prospects of Success 116Mr Karaka submits that the orders on the notice of motion ought be made upon the basis that Dr Barach has insufficient prospects of success to warrant being allowed to continue the proceedings. He characterises any continuation of the proceedings as an abuse of process. He submits that this is a case where: "The game will not merely not have been worth the candle, it will not have been worth the wick." See Jameel (Yousef) v Dow Jones & Co Inc [2005] QB 946 at 970 [69]. 117Dr Barach challenges this as being an available ground. 118When dealing with a predecessor of the rule here being considered, but which is in essentially identical form, the plurality judgment of the High Court of Australia, Gaudron, McHugh, Gummow and Hayne JJ in Agar at [55], said (omitting footnotes): "55. On an application to set aside service, or to have the Court decline to exercise jurisdiction, attention might be directed to any of a number of features of the proceeding, the claims made in it, or the parties to it, in aid of the proposition that the Court should not exercise jurisdiction. Part 10, r 6A is cast in general terms and it would be wrong to attempt some exhaustive description of the grounds upon which the rule might be invoked. Nevertheless, it may be expected that three common bases for doing so are first, that the claims made are not claims of a kind which are described in Pt 10, r IA, secondly that the Court is an inappropriate forum for the trial of the proceeding and thirdly, that the claims made have insufficient prospects of success to warrant putting an overseas defendant to the time, expense and trouble of defending the claims ." (emphasis added) 119It is the third aspect there mentioned, namely whether the claims made have insufficient prospects of success to warrant putting the 7 th defendant to the time, expense and trouble of defending them which provides a sufficient basis in law for the making of this submission. I reject Dr Barach's submission that the ground is not available at all in cases such as this. 120In support of his submissions on this ground, Mr Karaka relies principally upon the decision of the English Court of Appeal in Jameel . 121Jameel was a case which involved a foreign claimant issuing defamation proceedings in England against the publisher of a US newspaper in respect of an article posted on the internet website, in the USA, which was available to English subscribers. It was averred that only five individual subscribers had accessed the article. Although this number was not admitted, it was accepted that there had only been minimal publication within England. 122The UK Court of Appeal struck out the claim as an abuse of process. It did so by reference to two principal matters: (a) The Civil Procedure Rules 1998 (UK), which the Court said required it to be both more flexible and more proactive in its approach to litigation; and (b) the Human Rights Act 1988 (UK) which, the Court said, required it to administer the law in a manner compatible with the rights created by article 10 of the European Convention on Human Rights. 123At [55] it concluded: "Keeping a proper balance between the article 10 right of freedom of expression and the protection of individual reputation, must so it seems to us, require the court to bring to a stop as an abuse of process defamation proceedings that are not serving the legitimate purpose of protecting the claimant's reputation which includes compensating the claimant only if that reputation has been unlawfully damaged." 124Later in the judgment, the Court undertook an evaluative assessment of the nature of the particular claim and the appropriateness of its being heard in the Queens Bench Division of the High Court of Justice. It seems to measure whether the test was a "substantial" one, and whether the damages claimed warranted its attention. 125At [69]-[70] the Court said: "60. If the claimant succeeds in this action and is awarded a small amount of damages, it can perhaps be said that he will have achieved vindication for the damage done to his reputation in this country, but both the damage and the vindication will be minimal. The cost of the exercise will have been out of all proportion to what has been achieved. The game will not merely not have been worth the candle, it will not have been worth the wick. 70. If we were considering an application to set aside permission to serve these proceedings out of the jurisdiction we would allow that application on the basis that the five publications that had taken place in this jurisdiction did not, individually or collectively, amount to a real and substantial tort ... It would be an abuse of process to continue to commit the resources of the English court, including substantial judge and possibly jury time, to an action where so little is now seen to be at stake. Normally where a small claim is brought, it will be dealt with by a proportionate small claims procedure. Such a course is not available in an action for defamation where, although the claim is small, the issues are complex and subject to special procedure under the CPR [Civil Procedure Rules]." 126Mr Karaka submitted that the claim against him in these proceedings was far less "substantial" than the claim in Jameel . On that basis he submitted that, relying upon the principles set out in Jameel , the Court should dismiss Dr Barach's claim or else refuse to exercise its jurisdiction to entertain it. 127It is clear, and Mr Karaka accepted, that Jameel is not an authority which is binding upon this Court. But, he submitted that the Court should embrace the principles articulated in Jameel as being applicable in this Court. 128I do not think that Jameel is an authority which is appropriate to be followed by this Court, and so, I am satisfied that I should decline to follow Jameel . There are number of reasons why that is so. They are: (a) the decision is one clearly based upon, and perhaps mandated by, the provisions of the European Convention on Human Rights and the Human Rights Act (UK). Neither of these pieces of legislation are applicable in this jurisdiction or else these proceedings. There is a clear distinction between the legislation and principles to be applied here, and the legislation applicable in Jameel ; (b) the facts are not really comparable. It is true that both cases concern only a small number of recipients of the defamatory publications, but the claims against Mr Karaka here have a context of being part of a proceeding, which include a much larger number of defamatory publications (17 in all), to a broader group of people, and which includes allegations of a loss, inter alia, of Dr Barach's national and international reputation. That sets them well apart from the factual circumstances being considered in Jameel ; and (c) overall, the damages claimed in the proceedings here, of which I accept the claim against the 7 th defendant forms only a part, are said to be substantial. Whereas, in Jameel it seems to have been accepted, and the Court was satisfied, that the damages were minimal. Here it is not appropriate to dissect the damages which are claimed by reference to individual publications. Dr Barach claims that it is all of the publications which have caused him damages in an undifferentiated sense. Therefore the nature of the claim for damages is significantly different. 129For those reasons I am not prepared to follow Jameel in this case. My decision accords with the conclusions of Kirby J when he dealt with Jameel , albeit briefly, in Manefield v Child Care NSW [2010] NSWSC 1420 at [185]-[187]. 130However, this rejection of the principles articulated in Jameel , does not completely bring to an end the submissions made by Mr Karaka on this ground. Seemingly in reliance on the judgment of the plurality in Agar at [55], Mr Karaka submits that there are several reasons for concluding that Dr Barach's claim against him has insufficient prospects of success and hence the orders sought in the notice of motion ought be made. It is appropriate to examine these bases in turn. 131First, Mr Karaka challenges whether Dr Barach can establish that he in fact made the publications complained of. This challenge relates to the 15 th and 17 th matters complained of. 132Here, the plaintiff asserts, and Mr Karaka denies, the publication of the 15 th and 17 th defamatory matters complained of. The plaintiff provides some evidence which supports the fact that the publications were made. 133In his affidavit, he records a telephone conversation with his former wife, Ruth Kamar, who informed him of the publication upon which he relies as the 15 th matter complained of. He also reads an affidavit of Professor Jay Wolfson sworn 11 February 2011, which gives direct evidence of the publications upon which the plaintiff relies as being defamatory. This is the 17 th matter complained of. I note, as I have said earlier, that I have accepted that the name Wilson in the amended statement of claim in reference to the 17 th matter complained of, is a typographical error for the name Wolfson. 134In my opinion, this evidence establishes that, subject to proper proof at a trial, Dr Barach has available to him evidence of the publication of the 15 th and 17 th matters complained of. The document annexed to the amended statement of claim provides evidence of the publication of the 14 th matter complained of. 135Mr Karaka in his affidavit of 14 January 2011 denies that he had ever spoken with Ruth Kamar. He denies that he has ever spoken to a Professor Wilson. He gives no evidence about whether he has ever spoken to Professor Wolfson. 136In my opinion, Dr Barach has established a triable issue about publication which it is not appropriate to resolve at this stage of the proceedings particularly without seeing and hearing the witnesses give their evidence in proper form. 137Mr Karaka's submission that the Court would determine the unlikelihood of the plaintiff establishing publication is not one which I consider the Court should accept. There is a disputed question of fact which is appropriate to be determined at trial. The likelihood of one or other outcome in terms of the publication being established, is not a matter that the Court would, or can, on the evidence determine. 138It seems to me that in considering this issue I should regard the challenge which is made by Mr Karaka as being one analogous to a summary dismissal application, that is, where a matter can be heard and determined without a full hearing because there is no real or triable issue of fact, or there is no arguable or real question of law: See Dey v Victorian Railway Commissioners (1949) 78 CLR 62 at 91 per Dixon J, General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 at 129 per Barwick CJ. 139I note in particular, the caution expressed in the judgment of Mason CJ, Deane and Dawson JJ in Webster v Lampard (1993) 177 CLR 598 where at 603, their Honours said after referring to the authority to which I have just cited: "Nowhere is the need for exceptional caution more important than in a case where the ultimate outcome turns upon the resolution of some disputed issue or issues of fact." 140Great care, their Honours say, repeating Barwick CJ's remarks in General Steel at 130, was needed to ensure that the plaintiff is not improperly deprived of the opportunity of a trial. 141A refusal of jurisdiction by this Court or else a dismissal of the suit, would be a final determination in favour of the defendant of the plaintiff's claim. In that way, this application is analogous to a summary dismissal application. Hence, the application of the principles to which I have just referred. 142Secondly, Mr Karaka submits that even if the defamatory publications are proved, Dr Barach is unable to prove anything other than nominal damages given the limited publication. 143I have already noted that a judgment in favour of Dr Barach, even for nominal damages, will provide vindication of his reputation to some extent. Assessment of the importance of vindication will vary from person to person. I have no doubt that such vindication, having regard to the subject matter of the proceedings, and the defamatory imputations, is of the utmost importance to Dr Barach. 144As well, I am not prepared to hold that the damages likely to be recovered are only nominal. Dr Barach's claim for damages is broad based and far-reaching. The damages may well be substantial. I am not prepared to say that the entirety of the claim which he pleads suggests only nominal damages. In my opinion, whether he succeeds or not in proving that the damages which he claims were caused by or materially contributed to by the defamatory publications of the 7 th defendant is a matter for trial, not a matter upon which this Court can at this stage prevent being litigated. 145Thirdly, Mr Karaka submits that by application of the laws of the various states of the USA which constitute the substantive law of the tort, in accordance with Mr Melkonian's evidence, unless Dr Barach proves malice against Mr Karaka, his claim cannot succeed. 146I note that there is, as yet, no pleading of malice. However, given that the need to prove malice depends upon a finding by the Court, which Mr Karaka, if he were to defend the proceedings, would need to plead, that Dr Barach is a figure described as a "limited purpose public figure" in accordance with American law, then the occasion for the pleading of malice has not yet arisen. That would arise by way of a reply to any such defensive pleading. In those circumstances, whether or not Dr Barach will need to plead and prove malice, will depend upon the proper pleading of the claim, the particulars that are given in support of it and the pleading and proof of the substantive law of the relevant tort. 147This is not a matter of which I would be prepared to act upon at this stage of the proceedings.

Conclusion 148Although there is authority which supports the ability of Mr Karaka to argue that the plaintiff's claim has insufficient prospects of success to merit it being allowed to continued, I am not satisfied that upon the proper principles applicable, nor upon the facts that have been proved, Mr Karaka has satisfied me that Dr Barach's claim has insufficient prospects of success so that the continuation of it is properly to be considered as an abuse of process. 149In those circumstances I am not prepared to make any of the orders set out in the notice of motion and the notice of motion will be dismissed. 150Dr Barach submitted that in the event that the motion was to be dismissed that I should make an order in accordance with r 11.4 of the UCPR granting him leave to proceed against the 7 th defendant. 151Counsel for Mr Karaka accepted that if his motion was dismissed that it would be appropriate to grant leave. There will be such a grant. 152Costs should follow the event.

Orders (1) Notice of motion dated 21 October 2010 dismissed. (2) The 7 th defendant to pay the costs of the plaintiff of that motion. (3) Pursuant to r 11.4 of the Uniform Civil Procedure Rules 2005 I grant leave to the plaintiff to continue the proceedings against the 7 th defendant.

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: 24 May 2011

At a glance

Court

Decision date

Before

Catchwords

Source

Catchwords

Judgment (20 paragraphs)

Parties

Cases Cited (12)