Chau v Fairfax Media Publications Pty Ltd [2019] FCA 185 | Case summary

Chau v Fairfax Media Publications Pty Ltd [2019] FCA 185 | Case summary | Zoe

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REASONS FOR JUDGMENT The matter complained of [11] The alleged defamatory imputations [12] Were the defamatory imputations conveyed by the article? [13] Relevant principles - The "ordinary reasonable person" and the "natural and ordinary" meaning [14] Investigation, suspicion and the imputation of guilt [28] Imputation (a) - Dr Chau bribed Mr Ashe [32] Imputation (b) - Dr Chau participated in a conspiracy to bribe Mr Ashe [79] Imputation (c) - Dr Chau acted in so seriously wrong a manner as to deserve extradition to the United States on criminal charges, including charges of bribery [83] Imputation (d) - Dr Chau created his business empire in Australia by making illicit payments to government officials [88] Qualified privilege [97] Qualified privilege and reasonableness - Relevant principles [100] Interest or apparent interest [102] Conduct in publishing reasonable in the circumstances [106] Facts and evidence relevant to reasonableness [118] Mr Garnaut's earlier interactions with and impressions of Dr Chau [125] The United States Department of Justice Complaint and press release [150] The apparent urgency to publish [184] Mr Garnaut's sources of information and their reliability [190] Information sought from and provided by Mr Uren [191] Information from "confidential source 1" [199] Mr Flitton's research [202] Information from Dr Chau and Ms Chow [205] The fear of extradition assertions [206] The alleged "scrubbing" of websites [231] Obtaining and publishing Dr Chau's response [247] Mr Garnaut's contact with Mr Zheng [248] Mr Garnaut's conversation with Ms Chow [260] The conversation between Mr Wen and Dr Chau [274] The portrayal of Dr Chau's responses in the article [288] Conclusions in relation to obtaining and publishing Dr Chau's response [296] Mr Garnaut's belief and intentions in relation to the imputations [299] Relevant s 30(3) Defamation Act matters [311] Public interest - s 30(3)(a) [312] Public functions - s 30(3)(b) [313] Seriousness of the imputations - s 30(3)(c) [314] Distinguishing between suspicion, allegation and fact - s 30(3)(d) [315] Public interest in publishing expeditiously - s 30(3)(e) [316] Business environment - s 30(3)(f) [317] Sources of information - s 30(3)(g) [318] Dr Chau's side of the story - s 30(3)(h) [322] Other steps taken to verify - s 30(3)(i) [323] Was the conduct in publishing reasonable? [324] Malice [326] Relevant principles - Malice [328] Was the article actuated by malice? [330] Damages [336] Compensatory damages [337] Hurt and distress [345] Harm to reputation and vindication [348] The appropriate award [356] Section 38(1)(e) and mitigation [359] Aggravated damages [362] Injunctions and other relief [368] Interest [373] Disposition and Orders [375]

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WIGNEY J: 1 As long ago as 1963, Lord Devlin warned, in the context of an appeal in a defamation action, that: "[a] man who wants to talk at large about smoke may have to pick his words very carefully if he wants to exclude the suggestion that there is also a fire". His Lordship also observed that "loose talk about suspicion can very easily convey the impression that it is a suspicion that is well founded": Lewis v Daily Telegraph Ltd [1964] AC 234 at 285. The critical question in this defamation action is whether the media respondents heeded Lord Devlin's cautionary words, or whether their reporting of suspicions or allegations that the applicant was somehow implicated in a bribery "scandal" imputed that he was guilty of paying a bribe. If guilt was imputed, the question then arises whether the respondents' conduct in publishing the report was nevertheless reasonable in the circumstances. 2 Dr Chau Chak Wing is a Chinese-born Australian citizen. He is, by all accounts, a very wealthy man, with extensive business interests in China. He is also a generous philanthropist who has donated large amounts of money to a number of universities and public institutions in Australia. That itself has earnt him a degree of mostly favourable notoriety in Australia. He has also gained a degree of not so favourable notoriety as a result of some large donations he or his companies have made to the main political parties in Australia, combined with what has generally been seen to be his close relationships with some senior politicians. That has, perhaps understandably, generated some public and media interest and discussion. That discussion has at times focussed on the desirability or otherwise of Dr Chau maintaining high level business and political connections and influence in both China and Australia. 3 On 16 October 2015, Fairfax Media Publications Pty Limited published an article concerning Dr Chau on its Sydney Morning Herald website. The article was authored by Fairfax's former China correspondent, Mr John Garnaut. The main impetus for the article was the charging of three people in the United States of America for offences concerning the bribery of a former United Nations official. One of the bribery allegations concerned a payment to the official for his appearance at a conference in China which was said to be organised by a "Chinese real estate developer". The complaint that instituted the criminal proceedings did not name the Chinese real estate developer. Rather, it assigned him the pseudonym, or perhaps acronym, "CC-3". The central claim in Mr Garnaut's article was that Dr Chau was, or was likely to be, CC-3 and, perhaps more significantly, that the United States prosecutors were, or at least were likely to be, considering taking action against him in respect of the bribery allegations. That was undoubtedly a matter of some public interest in Australia given Dr Chau's prominence and notoriety. In that context, the article detailed Dr Chau's wealth and his political and other donations. The article's headline posed the rather puzzling, if not obtuse, rhetorical question: "Are Chau Chak Wing's circles of influence in Australia-China ties built on hot air?" The equally obtuse concluding sentence of the article hinted that the answer to that question was somehow linked to what was earlier described as the "unfolding international bribery scandal". 4 Dr Chau commenced proceedings against Fairfax and Mr Garnaut in relation to the article. He alleged that the article defamed him. He contended, in short, that the article imputed that he had bribed the United Nations official, or had participated in a conspiracy to bribe him, that he had acted in so seriously wrong a manner as to deserve extradition to the United States on criminal charges, including charges of bribery, and that he had created his business empire in Australia by making illicit payments to government officials. Dr Chau claimed that his business, personal and professional reputation had been brought into public disrepute, odium, ridicule and contempt as a result of the publication of those defamatory imputations. He also claimed that Mr Garnaut and Fairfax were actuated by malice. He sought damages and aggravated damages. 5 Fairfax and Mr Garnaut defended the proceedings. They denied that the articles conveyed the alleged imputations. They also claimed that, even if the article did convey the alleged imputations, the subject matters of the article were matters of legitimate public interest and their conduct in publishing it was reasonable in the circumstances. They contended that the article was accordingly published on an occasion of qualified privilege pursuant to s 30 of the Defamation Act 2005 (NSW) and corresponding provisions in the defamation legislation of the other Australian States and Territories. 6 The competing claims and contentions of the parties give rise to four main issues. 7 First, did the article convey any or all of the defamatory imputations that Dr Chau alleged it did? If none of the alleged imputations was conveyed, Dr Chau's case must fail and judgment would have to be entered for Fairfax and Mr Garnaut. 8 Second, if one or more of the defamatory imputations was conveyed, was the conduct of Fairfax and Mr Garnaut in publishing the article nevertheless reasonable in the circumstances? If that question is answered in the affirmative, subject to any finding of malice, Fairfax and Mr Garnaut's defence of qualified privilege would succeed. 9 Third, if the conduct of Fairfax and Mr Garnaut in publishing was reasonable in the circumstances, were they nonetheless actuated by malice? It might be observed that it is difficult to see how they could have acted reasonably if actuated by malice, but nonetheless if they were, that would defeat their defence of qualified privilege in any event. 10 Fourth, if Fairfax and Mr Garnaut' defence of qualified privilege fails, or is defeated, what damages should be awarded to Dr Chau in respect of the publication of the defamatory that were found to have been conveyed? Was Dr Chau also entitled to aggravated damages?

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The matter complained of 11 As has already been noted, the "matter complained of", to use the terminology usually employed in defamation cases, was an article that was published on Fairfax's Herald website on 16 October 2015. The article was relatively short such that it is convenient to set out its contents in full. For ease of reference, the following extract employs numbering for the headline, paragraphs and photographs, though the numbering does not appear in the published version of the article. The 7 photographs in the article are described, along with the caption, but not reproduced. 1. Are Chau Chak Wing's circles of influence in Australia-China ties built on hot air? 2. [By-line] John Garnaut 3. Chau Chak Wing may never get to live in the $70 million Vaucluse mansion that he bought from James Packer, sight unseen. 4. [Photograph of Dr Chau, above the caption, "Chau Chak Wing after donating a large sum of money to the Frank Gehry designed UTS Business School."] 5. Because of an unfolding international bribery scandal, some officials believe the highly connected Chinese tycoon may prefer to bunker down in his personal "imperial palace" just north of Guangzhou, beyond the reach of extradition treaties. 6. But, while the United States may be considering taking action against the billionaire businessman it describes as "CC-3" in a bribery indictment against a former president of the UN General Assembly, John Ashe of Antigua and Barbuda, Chau denies any direct knowledge of anything. 7. [Aerial photograph of Dr Chau's house, above the caption, "The most expensive sale of a single family home was the $70 million sale of James Packer's Vaucluse mansion to Chau Chak Wing."] 8. "I don't know the details, do you understand?" he told Fairfax Media by telephone from Guangzhou. 9. He said he'd had no request for evidence from investigators in the US and denied he had anything to fear from the unfolding scandal. 10. US prosecutors accuse Australian-Chinese businesswoman Sheri Yan and her finance chief Heidi Park of arranging for Ashe to be paid $US200,000, plus $US30,000 in travel expenses, for his entourage, plus a promise of bigger things to come. What the alleged bribe bought was Ashe's appearance, in his official UN capacity, at Chau's resort on November 17, 2013. 11. Ashe's appearance was trumpeted on Chau's Kingold company website right up until Ashe, Yan and Park were arrested by New York authorities on October 6 over the bribery allegation. 12. [Photograph of the University of Technology Sydney's Business School, above the caption, "Up to 70 per cent of students in UTS' bachelor of business course were admitted below the cut-off."] 13. Since then, most of the offending web pages have been scrubbed from cyberspace. 14. "The whole thing is a misunderstanding," Chau's Australian-educated daughter, Winky, told Fairfax Media on Thursday night, speaking from a family holiday in China. "We are going to issue a statement to clarify the whole thing," she said, before the line cut out and she could no longer be reached. 15. [Photograph of Dr Chau with former Prime Minister, Mr John Howard, above the caption, "Chau Chak Wing and John Howard share a toast in 2011."] 16. Chau, who confirmed he was in Guangzhou, said he did not organise the event at the centre of the scandal. 17. Though Chau was at the event, and was pictured with Ashe, he said: "I don't know him [Ashe] well, I didn't come into contact with him, and it wasn't me who invited him." 18. If Yan, the alleged bribe facilitator, was the social queen of Australia-China relations, then there can be no doubt that her No.1 client, Chau, was the king. 19. [Photograph of Dr Chau and former Prime Minister, Mr Kevin Rudd, above the caption, "Kevin Rudd in talks with Chau Chak Wing."] 20. Chau isn't really a doctor. He never even went to university. And yet Australian political, business and university leaders went to extraordinary lengths to sing his praises and to be seen at his eye-popping forbidden city at Congdu, in the verdant hills north of Guangzhou. 21. The spa resort boasts a 27-hole golf course, a golf club with a gold-plated roof, endless luxury villas and gardens, and a purpose-built imperial museum. 22. [Photograph of Dr Chau in front of a building site, above the caption, "Chau Chak Wing at the building site for the UTS business school."] 23. Chau's generous political donations - about $1 million each to the Liberals and Labor, and half that to the Nationals - were part of the story, but not the major part; it was his relationships with Australia's great and good. Former prime minister John Howard said he was attracted to his character and philanthropy. 24. "I know him, and I like him," Howard told Sydney's Daily Telegraph, after it was revealed two months ago that Chau had just paid $70 million for Packer's harbourside mansion. 25. [Photograph of Dr Chau with the former Governor-General of Australia, Mr Michael Jeffery, above the caption, "Chau Chak Wing with then Australian governor-general Michael Jeffery."] 26. "I see him as a very generous benefactor to good causes in Australia," Howard said. "I have enjoyed my relationship with him." 27. Howard was referring to a list of generous donations that begins with Chau's $20 million gift to the Frank Gehry-designed "brown paper bag" building at the University of Technology, Sydney, which bears his name. 28. Chau has followed up with $15 million for a museum, also bearing his name, and a $5 million scholarship program for Australian Chinese students. 29. But what really makes Australian politicians go the extra mile to seek Chau's friendship was his ability to open doors in China. 30. Howard credits Chau with playing a crucial role in securing the huge $25 billion LNG export deal that cemented Howard's reputation for being able to do business with China. 31. Former NSW premier Morris Iemma employed Chau's daughter Winky on his personal staff. 32. Former prime minister Kevin Rudd was known to go to extraordinary lengths to secure his company. 33. Former prime ministers Tony Abbott and Julia Gillard, and former foreign affairs minister and NSW premier Bob Carr found time to meet, write letters to and otherwise pay homage to, him. 34. Arguably, there was no other business leader in Australia who enjoyed such conspicuous access. 35. The more that Chau could demonstrate his influence in Australia, the more he could show his political utility in China, the more access he could offer Australians, and on it went in a seemingly endless circle. 36. Chau once told Fairfax Media that he never asked his "friends" for favours. He always dispersed his generosity without any strings attached. 37. To the Australians, it was all about access and opportunity, and hospitality at his "imperial palace", and the odd $1000 bottle of Chateau Lafite red wine. 38. To Chinese officials, the opportunities for generosity were much greater. He enjoyed nothing better than helping an official who was having trouble selling land. 39. He made himself known as the point man for organising the Chinese diaspora in Australia, with his Beijing-friendly Chinese media empire, and he was often successful in transmitting Beijing-friendly messages that Australian politicians might otherwise have been unwilling to receive. 40. It was a virtuous circle of guanxi - the Chinese method of making social networks to facilitate business dealings - and the perception of access and power created its own reality, which extended right up to the president of the UN General Assembly, John Ashe. 41. The complaint filed by New York prosecutors, following investigations by the Internal Revenue Service and Federal Bureau of Investigation, reveal a series of exchanges between Yan and Park about their client identified as "CC-3". 42. In October 2013, Park told Ashe that "an old friend of Sheri [who] is extremely wealthy" was organising an international conference in Guangzhou. She proposed a $US200,000 payment on behalf of a man whom US authorities describe as a "Chinese real estate developer". 43. Ashe asked about travel expenses for his entourage, leading Park to add another $US30,000 to the agreed amount. 44. When Yan wrote the invitation letter to Ashe, on Chau's behalf, she took care to note that this was only intended as a start. 45. A close associate, who is assisting Yan in New York, said: "The FBI and other officials here think that bribery goes with almost all Chinese. 46. "Sheri would never do anything she knew was illegal or improper." 47. US prosecutors link the payments from three unnamed Chinese business figures, including Chau, to Ashe's spending spree the following year. He and his wife were tracked paying $US59,000 to a Hong Kong clothing company in June 2014, and then $US69,000 for a vacation club membership the following month, two Rolexes ($US54,000) and a $US40,000 lease on a BMW Series 5. 48. Chau has not been charged with any offence. He hasn't even been explicitly identified by prosecutors. And while it might appear prudent for the billionaire to bunker down in China, away from the reach of extradition treaties, Chau has insisted it would not affect his travel to Australia. 49. "I will come and go as normal," he said. 50. This story is likely to have much more to tell, while we all learn whether the extraordinary Kingold kingdom of Australia and China relations was built upon illicit payments and hot air. 51. [By-line] With Philip Wen

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Relevant principles - The "ordinary reasonable person" and the "natural and ordinary" meaning 14 The principles to be applied in determining whether a publication conveyed defamatory imputations are well-settled and were not significantly in issue in this proceeding. The lead authorities and the principles established by them were summarised by Hunt CJ at CL (with whom Mason P and Handley JA agreed) in Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158 at 165, and more recently surveyed in this Court by White J in Hockey v Fairfax Media Publications Pty Ltd (2015) 237 FCR 33 at [63]-[73]. The basic principles were even more recently considered by the High Court in Trkulja v Google LLC (2018) 356 ALR 178 at [31]-[32] in the context of an appeal from the summary dismissal of a defamation action. It is, for the most part, unnecessary to cite all the well-known authorities. The principles relevant to this case may be summarised as follows. 15 First, the applicant, here Dr Chau, bears the onus of proving, on the balance of probabilities, that the alleged defamatory meanings or imputations were conveyed by the publication in question. 16 Second, the question whether the defamatory meanings were in fact conveyed is a question of fact. 17 Third, the question is whether the relevant publication would have conveyed the alleged meanings to an ordinary reasonable person. Where, as here, the publication is in writing, the question is what the impugned words in the publication would have conveyed to the ordinary reasonable reader. The Court is required to put itself in the shoes of, or assume the role of, the ordinary reasonable reader. The question is not a question of construction of the words used in the article in the legal sense. 18 Fourth, in this context, the authorities ascribe the ordinary reasonable reader with certain character traits, qualities or characteristics. The ordinary reasonable reader is variously said to be of fair, average intelligence, experience and education. They are also fair-minded and neither perverse, morbid nor suspicious of mind, nor avid for scandal. Of course, as the High Court pointed out in Trkulja at [31], ordinary men and women in fact have different temperaments, outlooks, degrees of education and life experience, so the exercise is really one of "attempting to envisage a mean or midpoint of temperaments and abilities and on that basis to decide the most damaging meaning". 19 Fifth, the meaning that the words would convey to the ordinary reasonable reader is often called "the natural and ordinary meaning" of the words. In some cases, the natural and ordinary meaning of the words may be obvious from the direct or literal meaning of the words themselves. More often than not, however, the question turns on what implications or inferences the ordinary reasonable reader would draw from the words. 20 Sixth, in determining what implications or inferences the ordinary reasonable reader would draw from the words, the authorities suggest that the ordinary reasonable reader should generally be taken to approach or consider a publication in a particular way or ways. The ordinary reasonable reader is, for example, said not to be a lawyer who examines the publication overzealously, but rather someone who views the publication casually and is prone to a degree of "loose thinking". The ordinary reasonable reader apparently does not live in an "ivory tower" but can and does read between the lines in the light of their general knowledge and experience of worldly affairs. While they do not search for hidden meanings or adopt strained or forced interpretations, they nevertheless draw implications, especially derogatory implications, more freely than a lawyer would. While they read the entire publication and consider the context as a whole, they take into account emphasis that may be given by conspicuous headlines or captions. 21 Seventh, the mode or manner of publication can be a relevant matter in determining what was conveyed to the ordinary reasonable person. The ordinary reasonable reader of a book, for example, is likely to read it with more care than he or she would read an article in a newspaper, particularly if that article is sensational. The ordinary reasonable reader of such an article is more prone to engage in loose thinking. That is all the more so where the words which are published are imprecise, ambiguous, loose, fanciful or unusual. 22 Eighth, as already adverted to, each alleged defamatory imputation has to be considered in the context of the entire matter complained of. It does not follow, however, that each part of the publication must be given equal significance. A headline, for example, may give the reader a predisposition about what follows and may therefore assume particular importance. Equally, contrary statements in an article will not necessarily or automatically negate the effect of other defamatory statements. 23 Ninth, the meaning that an ordinary reasonable reader would attribute to a publication, or the impression that the reader forms, may be influenced by the overall tone or tenor of the article in question. The article may, for example, be tinged with, or even pregnant with, insinuation or suggestion. It may also implicitly invite the reader to adopt a suspicious approach. As Gleeson CJ observed in Drummoyne Municipal Council v Australian Broadcasting Corporation (1990) 21 NSWLR 135 at 137: It is a feature of certain forms of defamation that one can read or hear matter published concerning a person and be left with the powerful impression that the person is a scoundrel, but find it very difficult to discern exactly what it is that the person is said or suggested to have done wrong. 24 Tenth, the determination of what an ordinary reasonable person would read into or infer from the words complained of is often a matter of impression. 25 Eleventh, while a publication may in some cases be reasonably capable of bearing more than one meaning, the tribunal of fact, whether it be a jury or a judge sitting alone, must ultimately determine whether the alleged defamatory meaning was in fact the single natural and ordinary meaning of the words complained of: Slim v Daily Telegraph Ltd [1968] 2 QB 157 at 174-175: Ten Group Pty Ltd v Cornes (2012) 114 SASR 46 at [34], [47]-[50]; Hockey at [73]. 26 Twelfth, in determining the meaning in fact conveyed by the publication, the intention of the publisher is irrelevant: Lee v Wilson and MacKinnon (1934) 51 CLR 276 at 288 per Dixon J; Baturina v Times Newspapers Ltd [2011] EWCA Civ 308; 1 WLR 1526 at [24]. 27 Thirteenth, the manner in which the publication was actually understood is also irrelevant in determining what meaning was conveyed to the ordinary reasonable person: Hough v London Express Newspaper, Ltd [1940] 2 KB 507 (CA) at 515; [1940] 3 All ER 31 at 35; Toomey v John Fairfax & Sons Ltd (1985) 1 NSWLR 291 at 301-302. The question is to be determined on the basis of the natural and ordinary meaning of the publication alone.

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Investigation, suspicion and the imputation of guilt 28 A mere statement that a person is being investigated by the police or prosecution agencies, or that a person is suspected of committing a crime, does not necessarily impute guilt. It may convey no more than that there are reasonable grounds to suspect that the person is guilty, or that there are reasonable grounds for investigating whether the person is guilty: Lewis v Daily Telegraph at 267-268 per Lord Morris of Borth-y-Gest; Chase v News Group Newspapers Ltd [2002] EWCA Civ 1772; [2002] 12 WLUK 44; [2003] EMLR 11; Flood v Times Newspapers Ltd [2012] UKSC 11; [2012] 2 AC 273 at [8]; [2012] 4 All ER 913 at [8]; Sands v State of South Australia (2015) 122 SASR 195 at [238]-[241]. The question, in such a case, is which of the possible meanings was in fact conveyed to the ordinary reasonable reader in all the circumstances. Much will depend on the context, the words used and the information conveyed by the matter complained of considered as a whole. 29 In that context, in Lewis v Daily Telegraph, Lord Devlin said (at 285): It is not, therefore, correct to say as a matter of law that a statement of suspicion imputes guilt. It can be said as a matter of practice that it very often does so, because although suspicion of guilt is something different from proof of guilt, it is the broad impression conveyed by the libel that has to be considered and not the meaning of each word under analysis. A man who wants to talk at large about smoke may have to pick his words very carefully if he wants to exclude the suggestion that there is also a fire; but it can be done. 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. They can convey a meaning of suspicion short of guilt; but loose talk about suspicion can very easily convey the impression that it is a suspicion that is well founded. 30 Similarly, in Favell v Queensland Newspapers Pty Ltd (2005) 221 ALR 186; [2005] HCA 52 (the facts of which, unlike Lewis v Daily Telegraph, somewhat ironically concerned a publication about a fire), Gleeson CJ, McHugh, Gummow and Heydon JJ said (at [12]): A mere statement that a person is under investigation, or that a person has been charged, may not be enough to impute guilt. If, however, it is accompanied by an account of the suspicious circumstances that have aroused the interest of the authorities, and that points towards a likelihood of guilt, then the position may be otherwise. … (Emphasis in original. Footnote omitted.) 31 It must also be borne in mind in this context that the ordinary reasonable reader is taken to be mindful of the principle that a person charged with a crime is presumed innocent until it is proved that he is guilty: Mirror Newspapers Limited v Harrison (1982) 149 CLR 293 at 300.

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Imputation (a) - Dr Chau bribed Mr Ashe 32 Imputation (a) is in effect a statement of guilt. Dr Chau alleged that the article went well beyond merely conveying that there were reasonable grounds to suspect that he was guilty of bribing Mr Ashe, or that there were reasonable grounds for investigating whether he did so. He contended that the article imputed that he was guilty of that offence. 33 Would the article have conveyed to an ordinary reasonable person that Dr Chau had bribed Mr Ashe? That question is not entirely easy to resolve. There are features of the article that point in different directions. 34 There are a number of features of the article that, on one view at least, would tend to suggest that the article would have conveyed no more to the ordinary reasonable reader than that there were reasonable, if not strong, grounds to suspect Dr Chau bribed Mr Ashe. 35 First, and most obviously, the article did not directly or literally assert that Dr Chau was guilty of bribing Mr Ashe. 36 Second, while the article asserted that the United States "may" be considering taking action against Dr Chau in respect of one of the bribes allegedly paid to Mr Ashe (at [6]), it also stated, albeit much later (at [48]), that Dr Chau had not been charged with any offence and had not even been explicitly identified by prosecutors. That was in contrast to the position of the three defendants who had been charged. 37 Third, the article made it tolerably clear that the criminal proceedings in the United States against those who had been charged were at an early stage. The ordinary reasonable reader might in that context be taken to be aware that the presumption of innocence of persons charged with offences applied in the United States. 38 Fourth, the article included statements by Dr Chau which an ordinary reasonable reader might construe as denials by Dr Chau. It stated that Dr Chau "denies any direct knowledge of anything" (at [6]), and that he had told Fairfax that "I don't know the details" (at [8]), that he did not organise the event (at [16]), and that "I don't know him [Ashe] well, I didn't come into contact with him, and it wasn't me who invited him" (at [17]). He is also reported to have said that he had received "no request for evidence from investigators in the US and denied he had anything to fear from the unfolding scandal" (at [9]) and that he would continue to travel to and from Australia as normal (at [48] and [49]). 39 Fourth, the article includes a statement from Dr Chau's daughter, Ms Winky Chow, which an ordinary reasonable reader might interpret as amounting to a statement that Dr Chau had done nothing wrong. She is reported to have told Fairfax that "[t]he whole thing is a misunderstanding" and that "[w]e are going to issue a statement to clarify the whole thing" (at [14]). 40 Fifth, the article includes a statement (at [45]) from an unnamed source that could, at least on one view, have suggested that the accused, and perhaps others who were the subject of the investigation, had been unfairly targeted because they were Chinese. That source apparently claimed that the "FBI and other officials here think that bribery goes with almost all Chinese". 41 There are, however, a number of significant features or aspects of the article which, taken together, tend to point strongly in the other direction: features that would tend to cause an ordinary reasonable reader to read between the lines and infer that, despite the fact that Dr Chau had not been charged, and despite his apparent denials, he had in fact bribed Mr Ashe. 42 First, as a matter of first impression, the general tone and tenor of the article as a whole is rather derisive and disparaging, if not, at times, sneering and contemptuous, towards Dr Chau. That tone flows from the sensational and hyperbolic language at times employed, as well as from some rather gratuitous barbs and insinuations; some subtle, others not so. 43 The headline somewhat puzzlingly questions whether Dr Chau's circles of influence are built on "hot air". The reader is left to guess at exactly what "hot air" might be involved, though what follows plainly suggests that it involved something improper or worthy of contempt. The article concludes (at [50]) with a further reference to "hot air", along with the suggestion of "illicit payments". When read in the context of other statements made in the article, the apparent insinuation is that Dr Chau has, or at least may have, bought his power and influence by making illicit payments of some kind. 44 Dr Chau is referred to in the article as a "highly connected Chinese tycoon" (at [5]) and a "billionaire businessman" (at [6]) who may prefer to "bunker down" in his "personal "imperial palace"" (at [5]) or "eye-popping forbidden city" (at [20]) to avoid extradition. He was said to have purchased a $70 million Vaucluse mansion "sight unseen" (at [3]). The references to Dr Chau's wealth, read in context, are not plaudits; rather they are sneering and derisory. What sort of person purchases a $70 million mansion "sight unseen"? 45 The appearance of Mr Ashe, the recipient of the alleged bribe, was said to have been "trumpeted" on "Chau's Kingold company website" (at [11]) until the "offending web pages" had been "scrubbed from cyberspace" (at [13]). 46 Dr Chau is described as presiding over the "extraordinary Kingold kingdom of Australia and China relations" (at [50]). It is not entirely clear what that means, but is certainly described in rather derogatory and derisory terms. The clear impression conveyed was that the "kingdom" included access and power that was acquired in some sort of illicit way. 47 Apropos of apparently nothing, it is said that "Chau isn't really a doctor" and that he "never even went to university" (at [20]). The article does not attempt to explain the relevance or significance of Dr Chau not being a doctor. It was not suggested that he represented to anyone that he was a doctor. Nor is the relevance of the fact that Dr Chau did not go to university immediately apparent. There appears, however, to be a sense of incredulity that Australian political, business and university leaders would associate with someone who was not really a doctor and who did not go to university. 48 Second, the article immediately commences with the implicit assertion that Dr Chau was somehow implicated in the so-called "unfolding international bribery scandal". Why else might he never get to live in the $70 million Vaucluse mansion that he bought "sight unseen", but instead "bunker down" in China "beyond the reach of extradition treaties"? The colourful expression "bunker down" is grammatically questionable and may have been confused with the expression "hunker down". Either way, the clear connotation was that Dr Chau might prefer to "dig in" or "lie low" to survive or get through a tough time. 49 The reference to the belief of unnamed "officials" concerning the likelihood of Dr Chau remaining in China to avoid extradition tends to bestow some weight or apparent authority on the suggestion. It is not just the author who thinks that is likely. The clear implication is that Dr Chau was likely to attempt to avoid being brought to justice. That itself suggests a possible consciousness of guilt on the part of Dr Chau. Why would he "bunker down" in China "beyond the reach of extradition treaties", rather than return to his Vaucluse "mansion", if he was not guilty? 50 The extradition theme is revisited towards the very end of the article. Thus, the article is bookended by the suggestion that Dr Chau might prefer to hide from, rather than fight, any action which might be taken against him in respect of the alleged bribery. It is strongly suggestive of guilt, even though it is couched in terms of the belief of certain unnamed "officials", and even though it is tempered somewhat by weasel-words such as "may prefer" or "might appear prudent". The clear implication or insinuation was nevertheless that Dr Chau had good reason to remain in China and avoid extradition to the United States to face a possible bribery charge. 51 The suggestion of Dr Chau's consciousness of guilt was further emphasised by the references to the fact that certain "offending web pages" had been "scrubbed from cyberspace". The offending web pages were said to be those on "Chau's Kingold company website" which "trumpeted" Mr Ashe's attendance at "Chau's resort". The hyperbolic and derisory language, in the context of the entire article, clearly suggested that the "scrubbing" was an attempt by Dr Chau to conceal apparently damning evidence of his connection with Mr Ashe and the supposed purpose of the bribe. The reader is effectively invited to reason: why would the web pages be "scrubbed" if Dr Chau was innocent? Why else would he attempt to conceal the connection? 52 Third, while Dr Chau's apparent response to, or denial of, aspects of the allegations are referred to at various parts of the articles, the manner in which they are disaggregated and inserted in the narrative undermines their effect and was likely to cause an ordinary reader to be dismissive and sceptical about them. There is a general tone of incredulity in relation to the denials. 53 The first denial appears at the end of paragraph 6, just after the introduction of the suggestion that Dr Chau might stay in China to avoid extradition. The denial is immediately preceded, and subverted, by the assertion that the United States may be considering taking action against Dr Chau. The insinuation is that, in the damning face of the United States considering taking that action, Dr Chau was nevertheless denying "any direct knowledge of anything". The inclusion of the words "of anything" tends to introduce a tone of disparagement if not absurdity. Even if Dr Chau used those words (though that is unclear because no quotation marks are used), taken out of context, as that statement appears to be, the denial of "any direct knowledge of anything" appears absurd. 54 The second denial is in paragraph 8. The statement by Dr Chau that he didn't know "the details", again disaggregated and taken out of its proper context, appears rather meaningless. The details of what? This denial was also undermined by the inclusion of the reference to Dr Chau being in Guangzhou. While in some contexts that may not be significant, this reference appears immediately after the assertion that Dr Chau might choose to "bunker down" in China to avoid extradition. The apparent suggestion is that Dr Chau was only willing to proffer this denial by telephone from his safe-haven in China, as opposed to a place from which he might be extradited. 55 The third denial, which appears in the next paragraph, is again referred to in rather oblique terms. Dr Chau is reported to have said that he had received "no request for evidence". There had, however, been no suggestion that the investigators had asked for any evidence, let alone what that evidence might be. Rather, the suggestion was that the United States may "take action" against him. Dr Chau was also said to have denied having anything to fear from the "unfolding scandal". The language and immediate context plainly implied that Dr Chau had a very good reason to be fearful; why else would some "officials" believe that he might remain in China "beyond the reach of extradition treaties"? 56 The fourth denial was supposedly provided by Dr Chau's daughter, Ms Chow, though the article does not attempt to explain how or why Ms Chow would necessarily know any details of any of the allegations. The statement, said to have been made by Dr Chau's "Australian-educated daughter", was also painted as being somewhat absurd: "[t]he whole thing is a misunderstanding". Ms Chow was also reported as having indicated that a statement would be issued to explain the "misunderstanding". This apparent denial, however, was effectively subverted by the reference to the fact that Ms Chow was "speaking from a family holiday in China", another allusion to the family being in a safe-haven, and, more significantly, by the insinuation that she had hung up on the caller and was then unable to be reached. 57 The fifth denial appears immediately after the reference to Ms Chow. It is preceded by the statement that Dr Chau had confirmed he was in Guangzhou. It is unclear why it was necessary to reiterate that point, though it again appears shortly after the suggestion that Dr Chau might remain in China to avoid extradition. Dr Chau was reported to have said that he did not organise the event at the "centre of the scandal". It is noteworthy, however, that this denial appears immediately after the article had reported that the alleged bribe bought Mr Ashe's appearance "at Chau's resort", that the appearance had been "trumpeted" on "Chau's Kingold company website", at least until Mr Ashe's arrest, and that the "offending web pages" had then been "scrubbed from cyberspace". The denial is also immediately followed by the statement that Dr Chau was at the event and was pictured with Mr Ashe. It was thus bookended by information or assertions which tended to contradict it. 58 The sixth denial, which was that Dr Chau had said that he did not know Mr Ashe well, did not come into contact with him, and that it was not him that invited Mr Ashe (at [17]), appeared immediately after the statement that Dr Chau had been pictured with Mr Ashe. It was also immediately followed by the assertion that Dr Chau was Ms Shiwei (also known as "Sheri") Yan's "No. 1 client". Ms Yan, of course, was the person who had in fact been charged with arranging for the alleged bribes to be paid to Mr Ashe. The assertion that Dr Chau was Ms Yan's "No. 1 client" was, in those circumstances, a clear suggestion that Dr Chau was closely connected to Ms Yan and therefore likely to have been involved in, if not to have directed, Ms Yan's actions. Thus, the denial was again presented alongside information that was likely to cause the ordinary reasonable reader to be incredulous about the denial. Indeed, the overall impression conveyed by the manner in which the denial was presented, was that it was ludicrous. 59 The seventh denial appears in paragraphs 48 and 49, towards the very end of the article. It appears immediately after the repetition of the assertion that it might appear "prudent" for Dr Chau to remain in China to avoid extradition. It is unclear to whom that might appear prudent, though it seems that it might have been the author's view. In any event, Dr Chau was reported to have said that "it" would not affect his travel to Australia and that he would "come and go as normal". The "it" would appear to be the threat of extradition, or the threat that the United States was considering taking action against him. The denial is thus again presented in such a way that might lead an ordinary reasonable reader to be sceptical if not dismissive in relation to it. 60 While it must be accepted that the reporting of Dr Chau's responses or denials is important in terms of assessing whether the article imputes guilt, the effect of the denials is effectively undone by the way they have been fragmented and inserted in the narrative. Indeed, the denials are dealt with in such a dismissive and disparaging way that they tend to have the opposite effect. 61 The fourth feature of the article that tends to impute guilt is that there are precious few references to the complaint apparently filed by the United States prosecutors only containing allegations or accusations, as opposed to proven or uncontroverted facts. Indeed, there are numerous instances where what appear to have been mere assertions or allegations are presented as unequivocal facts. It was asserted, for example, that there could be "no doubt" that Dr Chau was Ms Yan's "No. 1 client" (at [18]). As noted earlier, the clear implication was that Ms Yan was closely connected to Dr Chau and likely to have been acting on his behalf in paying the money to Mr Ashe. The basis of the unequivocal assertion that Dr Chau was Ms Yan's No. 1 client was entirely unclear. 62 There are numerous other examples of factual assertions or unequivocal statements about facts which were apparently relevant to the "bribery scandal". It was, for example, unequivocally asserted that Dr Chau was involved in a "virtuous circle of guanxi - the Chinese method of making social networks to facilitate business dealings - and the perception of access and power created its own reality, which extended right up to the president of the UN General Assembly, John Ashe". This was not presented as a mere allegation. Thus, the alleged bribe was effectively portrayed as an example, or another example, of Dr Chau's usual practice of currying favour with people in positions of power or influence so as to facilitate "business dealings". 63 It was also unequivocally asserted that the payment by Ms Yan to Mr Ashe bought "Ashe's appearance … at Chau's resort" (at [10]). While the payment was said to be an "alleged bribe", the statement about what it bought was unequivocal and unqualified. It was also unequivocally asserted Ms Yan wrote the invitation letter to Mr Ashe "on Chau's behalf" and that the prosecutors "link" the payments from "three unnamed Chinese business figures, including Chau" to Mr Ashe's "spending spree". The assertion that the payment came from Dr Chau was again stated in unequivocal terms. 64 The article contains no unambiguous or unequivocal statement that the facts referred to in the complaint filed by the prosecutors were only allegations. Rather, the complaint is simply said to "reveal" certain facts (at [41]). 65 It should also be noted, in this context, that while the article does state that Dr Chau had not been charged or even "explicitly" named in the indictment, that revelation does not come until the very end of the article. It was also immediately followed by the repetition of the suggestion that Dr Chau might remain in China to avoid extradition. Extradition, of course, can generally only occur once a person has been charged. Thus, the effect of the statement that Dr Chau had not been charged was immediately undone by the implication that he was not only likely to be charged, but that he might "bunker down" in China rather than face that charge. 66 The fifth feature of the article which tends to impute guilt arises from the overarching theme of the article, which attempts to link Dr Chau's connection with the bribery allegations in the United States to his "circles of influence in Australia-China ties" and the apparent suggestion that Dr Chau's influence and connections may have been acquired by means of "illicit payments". 67 The article clearly does not only concern the bribery allegations in the United States. Indeed, on one view of it, the bribery allegations form only a relatively small part of the article. Certainly, the treatment of the bribery allegations is, at best, cursory. Much of the article appears to deal with the rhetorical question posed in the headline. It goes into considerable detail about Dr Chau's wealth, his "generous" political donations, his association with past and present political figures in Australia, and the assertion that he wielded significant power and influence in both Australia and China. 68 What, however, was the supposed link between Dr Chau's donations, power and influence and his connection with the so-called "unfolding international bribery scandal"? The answer to that question appears to have been provided, or at least hinted at, in the concluding paragraph of the article. The main thesis appears to be that if Dr Chau had bribed Mr Ashe so as to secure his attendance at his "resort", that might suggest that Dr Chau's connections, power and influence, including in Australia, had similarly been "bought" by such "illicit payments". That is apparently why it could be postulated that "the extraordinary Kingold kingdom of Australia and China relations" may have been "built upon illicit payments and hot air". 69 The difficulty for Fairfax and Mr Garnaut, is that the article also tended to imply that the payment that had been made to Mr Ashe was entirely in keeping with the pattern of payments Dr Chau had made to people and entities of power and influence in Australia. It was part of what was said to be the "virtuous circle of guanxi", which, it appeared to be suggested, included acquiring connections and influence by paying money. Thus, Dr Chau's "access and power" was said to have "extended right up to the president of the UN General Assembly, John Ashe". That assertion, which as pointed out earlier, was made in unequivocal and unqualified terms, would have left the ordinary reasonable reader in little doubt that Dr Chau had bribed Mr Ashe. The insinuation was that the bribe was simply another example of the way Dr Chau operated. 70 The last paragraph of the article is prefaced by the words "[t]his story is likely to have much more to tell". While it is somewhat unclear, the "story" would appear to be, or to at least include, the bribery case in the United States. The suggestion appears to be that, as that story unfolds, "we", the public, will apparently "learn" whether Dr Chau's influence in Australia was indeed built on "illicit payments" and "hot air". 71 The meaning conveyed by the last paragraph of the article, read in context, is particularly important to the question whether the article conveyed imputation (d). It is considered in more detail in that context later in these reasons. It is sufficient to say, in the present context, that the apparent linkage of the bribery case concerning the payment to Mr Ashe and Dr Chau's donations, connections and influence in Australia, tended to bolster the implication or inference that Dr Chau did in fact pay the bribe to Mr Ashe. That is because, as has already been said, the impression likely to be conveyed to the ordinary reasonable reader was that the payment to Mr Ashe was consistent with Dr Chau's employment of the "virtuous circle of guanxi" and the pattern of payments Dr Chau had made to people and entities of influence in Australia. It was a payment made to secure the benefit of an apparent connection with the President of the United Nations General Assembly. That impression was exacerbated by the reference to "illicit payments" in the last few words of the article. 72 It should perhaps be noted, in the context of this feature of the article, that Fairfax and Mr Garnaut contended that the ordinary reasonable reader would have regard to the "[p]ositive character endorsements" given by the prominent politicians and other public figures that are referred to in the section of the article that deals with Dr Chau's influence in Australia. The suggestion was that the reader would consider those character endorsements to be contrary to any imputation of guilt. 73 It is, however, highly doubtful that the ordinary reasonable reader would have viewed those endorsements favourably having regard to the context in which they were included in the article. That is because the overall impression conveyed by the article is that, by making the donations referred to in the article, Dr Chau had effectively bought those positive character endorsements. 74 It must be emphasised, at this point, that it is not suggested that the ordinary reasonable reader would necessarily engage in a detailed analysis and discussion of the article of the sort that has just been conducted. As has already been noted, the ordinary reasonable reader is taken to be a person who does not to read or analyse a publication overzealously or search for hidden meanings or strained interpretations of the words used. The process of divining the meaning that would be conveyed to the ordinary reasonable reader is also not one of construction in the legal sense. Nevertheless, a judge sitting alone in a defamation action must, unlike a jury, provide reasons for arriving at the single natural and ordinary meaning of the words complained of. In many cases, that will involve a detailed analysis of the words in question. 75 On balance, I am positively persuaded that, having regard to the features of the articles that have just been identified and discussed, the article would have conveyed to the ordinary reasonable reader that Dr Chau bribed the President of the United Nations General Assembly, Mr Ashe. The natural and ordinary meaning of the words employed in the article, and the overall impression conveyed by the article considered as a whole, was not merely one of suspicion, but one of guilt. 76 It would, of course, have been perfectly open to Fairfax and Mr Garnaut to report on the complaint that had been filed in the United States and, perhaps more pertinently, to postulate that it could readily be inferred that the person referred to as CC-3 was Dr Chau. That could have been done in such a way as to convey to the ordinary reasonable reader no more than that there was reason to suspect, perhaps even strongly suspect, that Dr Chau was somehow involved in the course of events that had given rise to the bribery charges against Ms Yan, even though he had not himself been charged. Had that been done, Dr Chau may not have commenced these proceedings or, if he had, Fairfax may have had available to it the defence of justification pursuant to s 25 of the Defamation Act. It is, however, not useful to speculate about such matters. 77 The point is that the language, tone and content of the article went well beyond imputing mere suspicion. As Lord Devlin pointed out in Lewis v Daily Telegraph, "loose talk" about investigations, allegations or suspicions can very easily convey the impression of guilt. That is essentially what occurred here. The language was not only at times imprecise, ambiguous and loose, but also sensational and derisory. The language used was also, for the most part, not the language of mere allegation or suspicion, but rather the language of assertion or uncontroverted fact. The suggestion that Dr Chau was likely to, or was considered by some to have reason to, remain in China to avoid extradition was a particularly powerful factor in insinuating guilt. Why would he seek to avoid extradition and trial if he was innocent? So too was the assertion that Dr Chau had "scrubbed" the web pages that had "trumpeted" Mr Ashe's appearance at Dr Chau's resort; the very appearance which was said to have been bought by the payment. 78 The insinuation of guilt was exacerbated by the introduction of apparently unrelated and somewhat confounding facts concerning Dr Chau's wealth, donations and influence. Those facts were included in aid of a thesis that went beyond the specific bribery allegations and tended to imply that Dr Chau was a man who sought to buy power and influence, including by way of "illicit payments". The cumulative effect of all those features of the article was to convey to the ordinary reasonable reader that Dr Chau had indeed paid a bribe to Mr Ashe.

[18]

Imputation (b) - Dr Chau participated in a conspiracy to bribe Mr Ashe 79 Imputation (b) is not significantly or materially different to imputation (a). The only real difference is that Dr Chau is said to have participated in a conspiracy to bribe Mr Ashe, as opposed to bribing him. 80 The ordinary reasonable reader was likely to be aware that, in general terms, a conspiracy involves a plan or agreement to commit a crime, or perhaps the joint commission of a crime by a number of people. While the article does not use the word "conspiracy" in describing the bribery allegations, it describes the allegations in terms which would have conveyed to the ordinary reasonable reader that the payment to Mr Ashe arose from a plan, agreement or joint enterprise between Dr Chau, Ms Yan and Ms Heidi Hong Piao (also known as "Heidi Park"). 81 The main issue is whether the article conveyed that Dr Chau had in fact been involved in that conspiracy, or whether it simply conveyed a strong suspicion that that was the case. For the same reasons as those given in the context of imputation (a), the article would have conveyed to the ordinary reasonable reader that Dr Chau had in fact been involved in a conspiracy to bribe Mr Ashe. While it did not say so in express terms, the sensational and hyperbolic language employed in the article, the derisive and disparaging tone, the dismissive and subverting manner in which Dr Chau's denials were woven into the narrative, the absence of clear and unambiguous statements that the facts referred to in the article were, for the most part, mere allegations and had not been proved and, perhaps most significantly, the strong suggestions of consciousness of guilt on the part of Dr Chau, including that he might decide to remain in China to avoid extradition and had "scrubbed" the "offending web pages" that had shown his connections with Mr Ashe, would have left the reader in little doubt of Dr Chau's guilt. 82 In all the circumstances, I am positively persuaded that the article would have conveyed to the ordinary reasonable reader that Dr Chau had participated in a conspiracy to bribe Mr Ashe.

[19]

Imputation (c) - Dr Chau acted in so seriously wrong a manner as to deserve extradition to the United States on criminal charges, including charges of bribery 83 Much the same can be said in relation to imputation (c). 84 Extensive reference has already been made to those parts of the article which suggest that Dr Chau might prefer to "bunker down" in China "beyond the reach of extradition treaties", or that it might appear to be prudent, given that the United States might be considering taking action against him for bribing Mr Ashe: see paragraphs 3, 5, 6 and 48 of the article. The article also repeatedly emphasised, in that context, that Dr Chau was in China at the time he was contacted in connection with the article: see paragraphs 8 and 16. 85 There could be little doubt that the article conveyed to the ordinary reasonable reader, at the very least, that there were strong grounds to suspect that Dr Chau might face extradition to the United States in connection with the alleged bribery of Mr Ashe. Fairfax and Mr Garnaut did not contend otherwise. The main issue is again whether the article went beyond conveying a strong suspicion that Dr Chau had so acted, and instead conveyed that he had so acted. 86 Having regard to the way in which imputation (d) is framed, it is unnecessary to find that the article conveyed that Dr Chau was guilty of bribing, or conspiring to bribe, Mr Ashe. That is because, generally speaking, a person can be extradited if charged with an offence in another country. It is not necessary to demonstrate guilt for the purposes of extradition. Thus, the article could convey that Dr Chau had acted so as to "deserve" extradition to the United States in relation to the bribery allegations if it conveyed that Dr Chau had acted in such a way as to "deserve" being charged and extradited to face trial. 87 In any event, for the reasons already given in the context of imputations (a) and (b), I am positively persuaded that the article conveyed to the ordinary reasonable reader that Dr Chau was implicated in the bribery of Mr Ashe; that he had either bribed or conspired to bribe Mr Ashe. While the article said only that the United States "may" be considering taking action against Dr Chau, the overall impression conveyed by the article was that Dr Chau was implicated in the actions of Ms Yan so as to "deserve" such action, including extradition. The clear impression conveyed by the article was that Ms Yan was acting on behalf of her "No. 1 client" (at [18]), Dr Chau, when she made the payment to Mr Ashe and that the payment was made for Dr Chau's benefit, being to secure Mr Ashe's appearance at "Chau's resort" (at [10]), together with the "access and power" that supposedly flowed from that appearance (at [40]). There was nothing equivocal about those statements. The tenor, tone and generally unqualified nature of the article conveyed more than suspicion to the ordinary reasonable reader. Read as a whole, it conveyed that Dr Chau had acted in such a way as to deserve extradition to the United States to face bribery charges.

[20]

Imputation (d) - Dr Chau created his business empire in Australia by making illicit payments to government officials 88 Imputation (d) is significantly different to imputations (a), (b) and (c). Unlike those imputations, it does not directly concern the suggestion that Dr Chau was somehow implicated in the bribery case involving Mr Ashe. Rather, it concerns the suggestion that Dr Chau made some other illicit payments to "government officials" to create his "business empire" in Australia. The imputation is said to have been primarily conveyed by the very last paragraph of the article, read in the context of those paragraphs of the article that detail Dr Chau's donations, connections and influence in Australia. 89 There are a number of difficulties with the contention that this imputation was conveyed by the article. 90 The first difficulty is that the main thesis or postulate concerning "illicit payments" which is developed in the article, and which culminates in the last paragraph, does not appear to relate to any "business empire" that Dr Chau may have in Australia. Indeed, the only mention of Dr Chau having a "business empire" in Australia is the brief reference to him having a "Beijing-friendly Chinese media empire" (at [39]). While Dr Chau is referred to as a "billionaire businessman" (at [6]) and "business leader in Australia" (at [34]), he is also referred to as a "Chinese tycoon" (at [5]) and a "Chinese real estate developer" (at [42]). While it is somewhat unclear, the dominant impression conveyed by the article was that Dr Chau's business empire was in China. 91 The second difficulty, which is related to the first, is that the main thesis in the article relates more to what is described, rather vaguely and yet derisively, as the "extraordinary Kingold kingdom of Australia and China relations" (at [50]). It appears from the earlier parts of the article that this so-called "kingdom" is Dr Chau's network of influential business and political connections in Australia and China. As discussed earlier, the dominant theme of the article was that if Dr Chau had bribed Mr Ashe so as to secure his attendance at his "resort", that might suggest that Dr Chau's connections, power and influence, including in Australia, had similarly been "bought" by such "illicit payments". Importantly, the only payments in Australia referred to in the article were political donations (at [23]) and donations to universities (at [27] and [28]). Those payments could perhaps be seen as being loosely consistent with the thesis that Dr Chau may have bought connections and influence in Australia. There is, however, no real suggestion that those or any other payments assisted Dr Chau to create any "business empire in Australia". 92 Equally, it is difficult to see how it could be suggested that those payments were "illicit", in the sense of being somehow improper or unlawful. While it was said that "social networks" and "access" can "facilitate business dealings" (at [40]), the article did not link Dr Chau's political donations and donations to universities to any business dealings. Nor, indeed, is there any reference to any "government officials" in Australia, let alone any who may have been relevant to any business empire in Australia. The politicians named in the article could not really be said to be "government officials". 93 The third difficulty is that it is doubtful that the article conveyed to the ordinary reasonable reader anything beyond a strong suspicion that Dr Chau's influence and connections in relation to Australia and China relations may have been built on "illicit payments". For the reasons already given, the article considered as a whole conveyed to the ordinary reasonable reader that Dr Chau had bribed, or participated in a conspiracy to bribe, Mr Ashe. It went well beyond simply conveying a suspicion in that regard. That could not be said to be the case in relation to the thesis propounded by the article; that if Dr Chau was capable of paying a bribe to secure Mr Ashe's attendance at the conference he was organising, he was equally capable of paying bribes to secure influence and connections in other areas of his "kingdom". The article did not go so far as to convey that Dr Chau had in fact made "illicit payments" to "government officials", or anyone else other than Mr Ashe. Rather, it raised or posed a question about whether that was or might be the case given the payment of the bribe to Mr Ashe. The certainly would have conveyed to the ordinary reasonable reader that there was a strong suspicion that Dr Chau may have made other illicit payments, but it did not impute guilt in that regard. 94 In all the circumstances, I am not satisfied to the requisite standard that the article conveyed imputation (d). 95 It should perhaps be added, in fairness to Dr Chau, that the thesis advanced by the article was, at best, a fairly loose and dubious one. Dr Chau had not been charged with bribing, or conspiring to bribe, Mr Ashe. Indeed, even accepting that Dr Chau was, or may have been, the person identified as "CC-3" in the "complaint filed by New York prosecutors", the prosecutors appear to have made a conscious decision not only not to charge Dr Chau, but to protect his identity. Perhaps more significantly, while it might be accepted that Dr Chau had achieved a significant level of access to political leaders in Australia, there was not a scintilla of evidence to suggest that the access that Dr Chau had achieved was bought be any "illicit" payment or payments. Whatever one may think of political donations, they are not in any sense illicit if they are declared. There is no suggestion that Dr Chau's political donations were not declared. The apparent suggestion that donations to universities could somehow be illicit, or to have somehow improperly bought Dr Chau influence in Australia, is nothing short of bizarre. There was nothing whatsoever to suggest that the donations to the universities were anything other than laudable philanthropy. The article pointed to no other payments made by Dr Chau to public figures or entities, let alone any that might be considered to be "illicit". 96 It is, in all the circumstances, hard to see how the mere fact that Dr Chau may have somehow been involved in the events that gave rise to bribery charges against others in the United States provided reasonable grounds to invite readers to speculate that he might have been involved in making illicit payments to acquire political or public sector access in Australia. The rather obtuse references to "Australia and China relations" and "hot air" in this context also remain a mystery.

[23]

Interest or apparent interest 102 As already indicated, Dr Chau ultimately conceded that recipients of the impugned publication had an interest in having information on certain subjects, including the bribery allegations arising from a payment or payments made to Mr Ashe, his (Dr Chau's) possible influence in Australian political and business circles and his connection, if any, to the bribery allegations. Dr Chau also conceded that the defamatory matter was published in the course of giving recipients information on those subjects. 103 Dr Chau's concessions in relation to the first element of the qualified privilege defence were reasonably and properly made. In light of the concessions, it is unnecessary to consider the principles relevant to this element in any detail. Suffice it to say that the notion of interest, or apparent interest, is relatively broad. It includes "any matter of genuine interest" to the recipient, including fact and opinion: Seary v Molomby [1999] NSWSC 981 at [29]-[30]; Austin v Mirror Newspapers Ltd (1985) 3 NSWLR 354 at 359. It has also been said that it must be a "matter of substance" and "tangible", and not "vague or insubstantial": Barbaro v Amalgamated Television Services Pty Ltd (1985) 1 NSWLR 30 at 40. It does not extend to matters of "titillation" or mere "curiosity": Wright v Australian Broadcasting Corporation [1977] 1 NSWLR 697 at 711; Barbaro at 40. 104 There could be little doubt that, given Dr Chau's public profile in Australia, the bribery allegations against Ms Yan and Dr Chau's possible connection to them were subjects of genuine interest and tangible matters of substance, not matters of titillation or mere curiosity. The recipients of the defamatory matters had an interest or apparent interest in those subjects. There was also evidence that Fairfax and Mr Garnaut believed as much on reasonable grounds. The defamatory matters were published in the course of giving recipients information on those subjects. 105 It follows that the first element of the defence of qualified privilege was clearly made out by Fairfax and Mr Garnaut.

[24]

Conduct in publishing reasonable in the circumstances 106 Subsection 30(3) of the Defamation Act contains a list of factors or considerations that might be relevant in determining whether the conduct of the publisher in publishing the matter complained of was reasonable in the circumstances. It is in the following terms: (3) In determining for the purposes of subsection (1) whether the conduct of the defendant in publishing matter about a person is reasonable in the circumstances, a court may take into account: (a) the extent to which the matter published is of public interest, and (b) the extent to which the matter published relates to the performance of the public functions or activities of the person, and (c) the seriousness of any defamatory imputation carried by the matter published, and (d) the extent to which the matter published distinguishes between suspicions, allegations and proven facts, and (e) whether it was in the public interest in the circumstances for the matter published to be published expeditiously, and (f) the nature of the business environment in which the defendant operates, and (g) the sources of the information in the matter published and the integrity of those sources, and (h) whether the matter published contained the substance of the person's side of the story and, if not, whether a reasonable attempt was made by the defendant to obtain and publish a response from the person, and (i) any other steps taken to verify the information in the matter published, and (j) any other circumstances that the court considers relevant. 107 This list of factors is plainly neither exhaustive, nor mandatory: Rush v Nationwide News Pty Ltd [2018] FCA 357 at [139]. Nor should it be approached inflexibly. It provides, at best, a guide or pointer to the sorts of things which might be relevant in assessing reasonableness. The relevance or weight to be given to any one or more of the factors in the list will very much hinge on the particular facts of the case. Ultimately, the Court must have regard to "all the circumstances leading up to and surrounding the publication" and it would be "unwise to attempt any comprehensive definition of what they may be": Austin v Mirror Newspapers Ltd [1986] AC 299 at 313. The considerations which bear upon the reasonableness of the conduct of a publisher will vary with the circumstances of individual cases: Rogers v Nationwide News Pty Ltd (2003) 216 CLR 327 at [30] per Gleeson CJ and Gummow J. 108 The authorities in relation to the statutory defence of qualified privilege, including the cognate statutory defence of qualified privilege in s 22 of the former Defamation Act 1974 (NSW), establish a number of general principles in relation to the question whether the conduct of the respondent in publishing the matter complained of was reasonable in the circumstances. Many of those principles are replicated or addressed in s 30(3) of the Defamation Act. Like the list of factors in s 30(3), the general principles should again not be approached inflexibly, or on the basis that they comprise an exhaustive statement of the matters that may bear upon reasonableness in this context, or as if they comprise a series of hurdles or a definitive test of reasonableness: Hockey at [228]; Jameel v Wall Street Journal Europe Sprl (No 3) [2006] UKHL 44; [2007] 1 AC 359 at [33], [56]. Reasonableness is "not a concept that can be subjected to inflexible categorisation": Rogers at [30]. Nevertheless, and bearing those cautionary considerations in mind, the following general principles would appear to be apposite to the facts and circumstances of this case. 109 First, in most cases, the more serious the imputation that is conveyed, the greater the obligation upon the respondent to ensure that its conduct in relation to the publication was reasonable: Morgan v John Fairfax & Sons Ltd (No 2) (1991) 23 NSWLR 374 at 387C (per Hunt A-JA, with whom Samuels JA agreed); see s 30(3)(c) of the Defamation Act. 110 Second, a respondent who intended to convey an imputation that was in fact conveyed must generally establish that they believed in the truth of that imputation and that the imputation conveyed was relevant to the subject: Morgan at 387F and 388C. 111 Third, the fact that the respondent may not have intended to convey the imputation that was in fact conveyed does not necessarily mean that their conduct in publishing was unreasonable: Austin at 362; Roberts v Bass (2002) 212 CLR 1 at [81]-[82]. In such a case, the respondent must generally establish that they believed in the truth of the imputation that they intended to convey, and that their conduct was nevertheless reasonable in relation to the imputation which they did not intend to convey, but which was in fact conveyed. In that regard, it may be relevant to consider whether it was reasonably foreseeable that the publication might convey the unintended imputation and, if so, whether the respondent considered that possibility and took appropriate steps to prevent that imputation being conveyed: Morgan at 387G-388A; Obeid v John Fairfax Publications Pty Ltd (2006) 68 NSWLR 150 at [70]-[75]; Evatt v Nationwide News Pty Ltd [1999] NSWCA 99 at [40]-[43]. 112 Fourth, the respondent must generally establish that reasonable steps were taken before publishing to ensure that the facts and conclusions stated in the publication were accurate. That would generally involve making proper or reasonable inquiries, checking the accuracy and reliability of sources of information and ensuring that the conclusions followed logically, fairly and reasonably from the information that had been obtained; Morgan at 388B; see generally ss 30(3)(g) and (i) of the Defamation Act. In that context, the respondent must ordinarily disclose both the nature and source of the information which was possessed: Sims v Wran [1984] 1 NSWLR 317 at 327F. 113 Fifth, in relation to sources, the respondent's belief or perception of the position, standing, character and opportunities of knowledge of the source must be such as to make the respondent's belief in the truth and accuracy of the information reasonable in the circumstances: Morgan at 388D; s 30(3)(g) of the Defamation Act. 114 Sixth, a respondent must show that the manner and extent of the publication did not exceed what was reasonably required in the circumstances: Morgan at 388C. 115 Seventh, the respondent must also establish that the respondent gave the person defamed an opportunity to make a reasonable response to the defamatory imputation: Stephens v West Australian Newspapers Ltd (1994) 182 CLR 211 at 252; referred to by the High Court in Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 574. 116 In Lange, the High Court said the following about reasonableness in publishing, albeit in the context of the implied Constitutional defence to the publication of defamatory imputations relating to government and political matters at 574: Whether the making of a publication was reasonable must depend upon all the circumstances of the case. But, as a general rule, a defendant's conduct in publishing material giving rise to a defamatory imputation will not be reasonable unless the defendant had reasonable grounds for believing that the imputation was true, took proper steps, so far as they were reasonably open, to verify the accuracy of the material and did not believe the imputation to be untrue. Furthermore, the defendant's conduct will not be reasonable unless the defendant has sought a response from the person defamed and published the response made (if any) except in cases where the seeking or publication of a response was not practicable or it was unnecessary to give the plaintiff an opportunity to respond. (Footnotes omitted.) 117 Before specifically addressing the relevant s 30(3) Defamation Act considerations, and the general principles concerning reasonableness, having regard to the facts of this case, it is necessary to consider the evidence adduced by Fairfax and Mr Garnaut in relation to their conduct in investigating, writing and publishing the article in question.

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Facts and evidence relevant to reasonableness 118 Perhaps not surprisingly, Mr Garnaut was the key witness who was called in aid of the defence of qualified privilege and the question whether his and Fairfax's conduct in publishing the article was reasonable in the circumstances. Mr Garnaut gave evidence in relation to his experience as a journalist, in particular as a correspondent in China, his interactions with Dr Chau prior to the publication of the article and the impressions he formed of him, the inquiries he conducted concerning the subject matter of the article and the sources of his information, and his beliefs and intentions in relation to the imputations which were conveyed by the article. 119 As will be seen, I have some doubts about Mr Garnaut's reliability and credibility as a witness, at least in respect of some contentious issues raised by his evidence. For the most part, he presented as an honest and reliable witness. He was plainly a very articulate and highly qualified and experienced journalist who had extensive knowledge about matters relating to China. I found, however, that he was at times prone to exaggeration and hyperbole, particularly in relation to his evidence concerning his interactions with and impressions of Dr Chau. He also at times showed signs of arrogance, if not smugness, concerning the article and the subject matters with which it dealt. That attitude at times manifested itself in Mr Garnaut giving inappropriately dismissive, unresponsive, overly defensive or unhelpful answers to questions which tended to impugn the article and the basis for some of what was said in it. It also appeared to make him reluctant at times to make appropriate concessions in respect of issues that may have reflected adversely on him or the reasonableness of the article. 120 Most significantly, however, I have serious doubts about the honesty and reliability of at least one aspect of Mr Garnaut's evidence concerning a supposed confidential source of information. As will be seen, I doubt that that confidential source existed, or that if the source did exist, that he gave Mr Garnaut the information which Mr Garnaut claimed that he did. The likelihood is that Mr Garnaut's evidence concerning that source was manufactured so as to justify the very late addition to the article of the reference to "some officials" believing that Dr Chau might "bunker down" in China to avoid extradition. The evidence in relation to that issue is addressed in detail later. 121 Fairfax and Mr Garnaut called two other witnesses, both Fairfax journalists who assisted Mr Garnaut in relation to the article. 122 Mr Daniel Flitton was a Fairfax journalist who assisted Mr Garnaut in respect of one particular aspect of his investigation; the supposed "scrubbing" of websites or web pages that had revealed Dr Chau's contact with Mr Ashe at or during the conference held at Dr Chau's resort. As will be seen, there are serious question marks concerning the accuracy of the assertion concerning "scrubbing" that ultimately found its way into the article. That said, there were and are no relevant doubts about the credibility or reliability of Mr Flitton's evidence in relation to that issue. The real issue which arises is whether Mr Garnaut misinterpreted or misrepresented the information provided to him by Mr Flitton. 123 Mr Philip Wen was Fairfax's China correspondent at the time the article was written and published. Mr Wen's by-line was included at the conclusion of the article. The main role that Mr Wen played in investigating and formulating the article was to contact Dr Chau for his response or comment. He provided a summary of his interview with Dr Chau to Mr Garnaut and others. His summary, or parts of it, ultimately found its way into the article. The adequacy of the way the article dealt with Dr Chau's side of the story is addressed in detail later. 124 Before referring to the genesis of the article and Mr Garnaut's investigations and sources of information, it is necessary to say something about Mr Garnaut's evidence concerning his initial interactions with Dr Chau, the impressions he formed about Dr Chau, and how those impressions may have impacted on the approach that Mr Garnaut took to the investigation and writing of the article.

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Mr Garnaut's earlier interactions with and impressions of Dr Chau 125 Mr Garnaut gave lengthy and detailed evidence concerning his knowledge of, and previous contacts with, Dr Chau. It is not proposed to address that evidence in any great detail. That is because the relevance of much of it to the issues for consideration in this matter was and is somewhat elusive. Very little was said about this evidence in the final submissions made on behalf of Mr Garnaut and Fairfax. It does appear from the evidence, however, that Mr Garnaut's impressions of, and attitude towards, Dr Chau, which he formed as a result of some of his earlier interactions, may well have coloured, if not blinkered, his approach to his inquiries concerning the story and to the ultimate tenor of the article. 126 It would appear that Mr Garnaut first became aware of Dr Chau in about June 2009 when he was asked to interview Dr Chau for the purposes of an article being researched by other Fairfax journalists. Mr Garnaut was Fairfax's China correspondent at the time. Mr Garnaut in due course travelled to Guangzhou, where Dr Chau resided, and interviewed him. It would appear that Dr Chau's assistant offered to arrange flights and book accommodation for Mr Garnaut. That offer was refused. It seems that Mr Garnaut considered the offer to be inappropriate in the circumstances. There was, however, nothing to suggest that Dr Chau was personally involved in, or even knew about the offer, let alone that he made the offer for ulterior or untoward purposes. 127 Two other things occurred during, and immediately after, the interview which appeared to be of particular significance to Mr Garnaut. 128 The first occurrence was that at some stage during the informal discussions that preceded or followed the formal interview, Dr Chau said, "with a little bit of a twinkle in his eye", that Mr Garnaut could or should come and work with him. There was also some suggestion that, again during the informal discussions, Dr Chau suggested that Mr Garnaut and his family should holiday at his resort. 129 The second occurrence was that, at the conclusion of the interview, Mr Garnaut was given, as a gift, a number of expensive bottles of wine. Dr Chau was present when that gift was given. Mr Garnaut did not refuse or subsequently return the gift, though ultimately he declared the bottles of wine to his employer and they were auctioned for charity. It does not appear that Mr Garnaut told Dr Chau at any stage that he considered that it was improper for Dr Chau to give him gifts. 130 Mr Garnaut apparently formed an adverse impression of Dr Chau from these two incidents. That impression was that Dr Chau was somehow "cultivating" him for some reason or another. 131 Dr Chau was cross-examined about the incidents that occurred during his first meeting with Dr Chau. He appeared to indicate that he did not know that an offer had been made to pay for Mr Garnaut's transport to Guangzhou. That was something that may have been done by one of his assistants without his knowledge. As for the supposed job offer, Dr Chau said that it was intended as a joke, the context for which was that Mr Garnaut had indicated that his employer wanted to transfer him back to Australia. As for the suggestion that Mr Garnaut and his family should holiday at his resort, Dr Chau's evidence was that this was simply "traditional Chinese culture, being polite to your guest". 132 As for the gift of wine, Dr Chau had no particular recollection of that having occurred. He did not, however, deny that it did. Curiously, it was not suggested to Dr Chau that he had any improper or untoward motivation for making the gift, or even that Dr Chau was aware that there was anything inappropriate about giving a gift to a journalist. It was certainly not put to him that he was somehow intending to "cultivate" Mr Garnaut for some reason. While it is perhaps understandable that this particular incident stuck in Mr Garnaut's mind, it is equally understandable that it may not have been of much, if any, particular significance to Dr Chau. 133 It should perhaps be noted in this context that some of the evidence that Dr Chau gave in relation to his early meetings did not reflect particularly well on his reliability as a witness. While it may have been understandable that Dr Chau did not have a clear and detailed recollection of some of his early interactions with Mr Garnaut, the initial effect of his evidence was that he had virtually no recollection of Mr Garnaut and was barely able to recognise him. With respect to Dr Chau, he appeared to be feigning his lack of recollection of Mr Garnaut and, for some reason or other, attempting to distance himself from him. Exactly why is unclear. Nevertheless, when pressed, he was eventually able to recall some of the supposedly material incidents or events involving Mr Garnaut about which he was cross-examined. 134 Following Mr Garnaut's first interview with Dr Chau, Mr Garnaut and others wrote an article which was in due course published by Fairfax. That article discussed, amongst other things, Dr Chau's background, his businesses and connections in China, and his donations and political and other connections in Australia. It would perhaps be fair to say that the article does not criticise or portray Dr Chau in a particularly negative light. It was apparently not perceived negatively by Dr Chau. 135 Subsequent to that interview, Mr Garnaut and his wife were invited to have lunch with Dr Chau in Beijing. They accepted that invitation. Another gift of wine was handed to Mr Garnaut after that lunch. Despite his reaction to the earlier gift following the interview, Mr Garnaut did not refuse this further gift, or suggest to Dr Chau that it would be inappropriate for him to accept it. He did, however, again subsequently declare the wine to his employers and it was sold for charity. 136 Mr Garnaut's next meeting with Dr Chau was in about July 2010. The occasion for that meeting was that other Fairfax journalists were researching a story relating to Dr Chau's donations to the University of Technology in Sydney. Mr Garnaut arranged to meet Dr Chau at the Peninsula Hotel in Beijing with a view to questioning him about that donation. As events transpired, however, only "small talk" occurred at the meeting. Mr Garnaut's evidence was that Dr Chau "deflected" his request for an interview and promised an interview at a later stage. 137 A matter of apparent significance for Mr Garnaut, in the context of this particular interaction with Dr Chau, was that Dr Chau's arrival at the hotel was, according to Mr Garnaut at least, accompanied by "flashing lights and sirens", and that Dr Chau was seen to emerge from a large black car with paramilitary number plates. Exactly why that was relevant was left unexplored in the final submissions, though as will be seen it again appears to have caused Mr Garnaut to form various negative, if not rather sinister, impressions of Dr Chau. Those impressions included that Dr Chau may have been a functionary of the Chinese State or even the Chinese security or intelligence services. 138 In cross-examination, however, Dr Chau gave a rather more benign description of his transport to the Peninsula Hotel on this occasion. He said that a friend of his who was his host at the Peninsula Hotel provided the car to pick him up. While that evidence was the subject of further questioning, it was not put to Dr Chau, in this context or any other, that he was in fact a functionary of the Chinese State, or that he was in any way involved with the Chinese security or intelligence services. It was and is difficult to understand what was intended to be made of this evidence. It was perhaps one of a number of instances where Fairfax and Mr Garnaut, through their counsel, were, to use the words of Alexander Pope, "willing to wound, and yet afraid to strike". 139 The next interaction between Mr Garnaut and Dr Chau occurred in November 2011 when Mr Garnaut, along with other members of the international media, was invited to the opening of a museum at Dr Chau's resort. He accepted that invitation and conducted a short interview with Dr Chau. It would perhaps be fair to say that Mr Garnaut appears to have been particularly awestruck by the museum and Dr Chau's wealth and privilege generally. Two articles were subsequently written by Mr Garnaut and published by Fairfax arising from that visit and interview. 140 On the basis of those relatively few and fairly brief interactions with Dr Chau between 2009 and 2011, Mr Garnaut claimed to have formed "[v]ery strong" impressions and a "series of insights" in relation to how Dr Chau "operated". His evidence in that regard was as follows: Yes, please?---So I thought a series of - I thought I had a series of insights into how he operated: (1) he worked - he worked to create a shock and awe demonstration of power and wealth, and that impression was important; (2) he sought to seek commitments - or he gave and he sought commitments of - reciprocal commitments of - of friendship, special friendship, which were underpinned by common interests, not hobbies, but interests more fundamental to your profession; (3) I thought that he typically - or he worked to sweeten that friendship with special luxuries and shared experiences of opulent luxuries. I thought - you know, from my own experience I could see that sometimes that special friendship was underwritten by benefits of very significant value. I had observed him in my own interactions. You know, I thought he had systematically worked to lower the moral inhibitions to receive improper benefits by emphasising that he asked - asked nothing in return, and by elevating the friendship to the level of a higher policy goal. You know, in my case it was Australia-China relations. In other cases it was other things. I thought he thought - he sought to lower the fear of being caught accepting improper benefits by exercising his - what he called his ….. his discretion - super low profile - and I thought - and I observed how he had - really, he would frame what he had - the benefits that he had shared - as really a down-payment on future greater benefits that would come in the future, but I thought the most important part of this for my observation was those future greater benefits were contingent upon good behaviour of some sort. 141 Mr Garnaut's evidence in relation to his supposed insights into Dr Chau and the way he operated was far from impressive. While it perhaps cannot be doubted that he had in fact formed those various impressions of Dr Chau, some of his conclusions about how Dr Chau operated appeared to be highly speculative and exaggerated, particularly given the relatively limited interactions he had actually had with Dr Chau and, perhaps more significantly, the relatively limited amount of actual research he had conducted, and the relatively little objective information he appeared to have about Dr Chau. That is particularly the case in respect of the supposed "insight" that Dr Chau "systematically worked to lower moral inhibitions to receive improper benefits by emphasising that he asked … nothing in return, and by elevating the friendship to the level of a higher policy goal" and that he "sought to lower the fear of being caught accepting improper benefits by exercising his … discretion - super low profile". 142 What improper benefits? If Mr Garnaut was referring to the gifts of wine, or the offers of hospitality, or the luncheon invitation, it would appear to be a very long bow indeed to draw those very adverse conclusions concerning Dr Chau. It is difficult to see how, in all the circumstances, those very adverse conclusions were warranted or justified in all the circumstances, and equally difficult to see why Dr Chau's explanation that these were simply incidents of politeness and traditional Chinese culture was in any way implausible. 143 If anything, Mr Garnaut's evidence concerning his impressions of Dr Chau tended to reveal that he was somewhat in awe of Dr Chau's wealth and apparent power and influence in China, to the point, perhaps, of being almost mildly obsessed or even infatuated, at least in a professional sense, by him. That attitude to Dr Chau may well have coloured, if not clouded, Mr Garnaut's approach and objectivity when it came to investigating and writing the article the subject of this proceeding. So much so appeared to be acknowledged by Mr Garnaut, later in his evidence, when he said: But can I point out, I would like to say at some point, just how important it was to me that the pattern of interaction and invitation and payments, as described in the indictment, if that's a fair representation, how closely that fit the pattern that I had observed myself with Dr Chau, and his endeavours to, I think, cultivate me. 144 A number of points can be made about that evidence. 145 First, for the reasons essentially already given, while it may perhaps be accepted that Mr Garnaut genuinely believed that Dr Chau had attempted to "cultivate" him, it is difficult to accept that that was in fact the case based on the relatively limited interactions between 2009 and 2011. It should also perhaps again be noted that it was never put directly to Dr Chau that he had attempted to "cultivate" Mr Garnaut in the way described by Mr Garnaut, or that the gifts of wine, or for that matter, the supposed job offer and offers of hospitality, were in any way improper or inappropriate. 146 Second, and perhaps more significantly, Mr Garnaut's reference to the "pattern of interaction … and payments" in the indictment perhaps showed how Mr Garnaut's attitude to Dr Chau had influenced, if not distorted, how he read the complaint which had been filed by prosecutors in the United States. As will be seen, there was, on any view, no "pattern of interaction … and payments" involving Dr Chau referred to in the relevant complaint. Even accepting, for the sake of argument, that CC-3 was Dr Chau, there was allegedly only one invitation and one payment to Mr Ashe. One alleged invitation and payment cannot constitute a "pattern". In any event, as discussed earlier, the complaint contained no direct allegation that Dr Chau was directly involved in giving that invitation or making that payment. 147 Mr Garnaut's evidence included some other rather extraordinary, if not outlandish and paranoic, statements or theories about Dr Chau. They included that Dr Chau may have paid the alleged bribe to Mr Ashe as "an agent of … the Chinese State" or "as an actual asset of the Chinese intelligence system". Mr Garnaut did not explain in any detail, in his evidence, exactly how he arrived at those views or beliefs, or what objective information provided the basis for them. He did not shed any light on how and why Mr Ashe's appearance at a conference organised by a group of non-government organisations somehow advanced the interests of the Chinese State or its intelligence services. And of course, none of these theories were ever put to Dr Chau in cross-examination; a recognition, perhaps, that they in fact had no rational or reasonable basis. 148 While it may be accepted that Mr Garnaut was a keen, experienced and knowledgeable observer of China, his willingness to draw such adverse inferences about Dr Chau and his conduct on the basis of what was apparently fairly limited objectively verified information did not reflect well on Mr Garnaut or his evidence. Perhaps fortunately for Mr Garnaut and Fairfax, the rather extraordinary conclusions that had been arrived at by Mr Garnaut did not ultimately make their way into the article. 149 There was also some evidence that tended to suggest that, at the time of publication of the article, Mr Garnaut was not positively disposed towards Dr Chau, to say the very least. Indeed, from the tenor of various internal emails about the article, Mr Garnaut appeared to approach the task of publishing a "big hit" on Dr Chau with some considerable enthusiasm, if not glee. The evidence on this point is discussed later in the context of the allegation of malice. It suffices at this point to again note that it may fairly be inferred that Mr Garnaut's apparently negative views and attitude toward Dr Chau appear to have adversely influenced his approach to investigating and writing the article.

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The United States Department of Justice Complaint and press release 150 The genesis of the article ultimately penned by Mr Garnaut and published by Fairfax was a "Sealed Complaint" filed on behalf of the Federal Bureau of Investigation and approved by Assistant United States Attorneys in New York. Mr Garnaut was alerted to the Complaint by a friend and colleague. Mr Garnaut's evidence was that he read and considered the Complaint. 151 The Complaint is a very lengthy and detailed document. It runs to 37 pages. It contains five counts or charges under United States law and details the factual allegations said to underlie those charges. Critically, in the present context, upon any close or careful reading, it provides precious little support for any of the imputations conveyed by the article. Had Mr Garnaut in fact closely and carefully read and analysed the Complaint, as he suggested he did, that should have been apparent to him. 152 The indictment names five defendants: Mr Ashe, Mr Francis Lorenzo, Mr Ng Lap Seng, Mr Jeff C. Yin, Ms Yan and Ms Piao (also known as "Park"). Needless to say, Dr Chau is not named as a defendant. Nor is he named or explicitly referred to in any part of the Complaint. 153 As already indicated, the Complaint contains five counts. 154 The first count is a charge of conspiracy to bribe a United Nations official. The defendants to that count are Mr Lorenzo, Mr Ng, Mr Yin, Ms Yan and Ms Piao. It is alleged that those defendants "and others known and unknown, willfully and knowingly did combine, conspire, confederate, and agree together and with each other to violate Title 18, United States Code, s 666". Mr Garnaut and Fairfax relied on the fact that this charge referred to persons "known and unknown" and suggested that Dr Chau was, or may have been, one of those persons. As will be seen, a careful reading of the indictment reveals that that reliance was largely misplaced or at best tenuous. It should also perhaps be added that such verbiage is not unusual in conspiracy counts. It tends to reveal very little. 155 The key particular of count 1 was that Mr Lorenzo, Mr Ng, Mr Yin, Ms Yan and Ms Piao "agreed to pay and to facilitate the payment of bribes to an individual serving as President of the United Nations General Assembly and the Permanent Representative to the United Nations ("UN") for Antigua and Barbuda ("Antigua"), in exchange for official actions on behalf of businessmen". Mr Garnaut and Fairfax relied on the allegation that the alleged bribes were paid on behalf of "businessmen". Dr Chau was said to be a businessman. As will be seen, even putting aside the obvious point that there are probably many millions of people who may be described as businessmen in China and elsewhere, a careful reading of the indictment again reveals that this reliance was in any event misplaced or, at best, tenuous. It suffices at this stage to note that a number of alleged bribes were paid to Mr Ashe. Only one of the alleged bribes could be said to have had anything whatsoever to do with Dr Chau. 156 The Complaint contains particulars of the overt acts of the alleged conspiracy. Only one of those overt acts could possibly be said to relate in any way to Dr Chau. That particular was in the following terms: On or about November 4, 2013, YAN and PIAO arranged for a $200,000 wire to a bank account belonging to the President of the UN General Assembly from another co-conspirator not named as a defendant herein in exchange for the President attending a private conference in his official capacity. 157 Mr Garnaut and Fairfax relied on the fact that the alleged payment was said to have come from "another co-conspirator not named as a defendant herein". They contended that that co-conspirator was Dr Chau. There are some issues or weaknesses with that contention. First, though there are references later in the Complaint to a person referred to as "CC-3", this particular does not identify the alleged co-conspirator as CC-3. That may be contrasted with one of the other particulars, where the source of an alleged bribe was similarly referred to as a co-conspirator not named in the Complaint, but identified as "CC-1". Second, as will be seen, it was not directly alleged that the relevant payment came from CC-3. Rather, it was said to have come from "one of CC-3's companies". It does not follow that the payment came from, or was made on behalf of, or with the knowledge of, CC-3. No such direct allegation was made in the Complaint. 158 Count two in the Complaint is an offence against Title 18, United States Code, s 666(a)(2) and 2. This was the substantive offence which was the subject of the alleged conspiracy which was the subject of the first count. The defendants to the second count are Mr Lorenzo, Mr Ng, Mr Yin, Ms Yan and Ms Piao. The key particular of this count is that the defendants paid bribes to Mr Ashe in exchange for official actions on behalf of businessmen. It is noteworthy that there is no allegation that any other person, known or unknown, aside from the named defendants, was responsible for paying the alleged bribes. It was not alleged in count two that CC-3 paid any bribe to Mr Ashe. 159 Count three in the Complaint is a charge of "Conspiracy to Commit Transportation Money Laundering". It is unnecessary to say anything further about this count. There could be no basis for contending that it had anything to do with CC-3 or Dr Chau. Mr Garnaut and Fairfax did not contend otherwise. 160 The same can be said about counts four and five in the Complaint, which are charges against Mr Ashe alone. They relate to his income tax affairs. 161 Page 5 through to page 37 of the Complaint contains a detailed recitation of the factual allegations relating to the charges. The critical point to note about the factual allegations is that there is not a single direct allegation that the person referred to as CC-3 did anything to instigate or effect, or knew anything about, the payment which was alleged to constitute the relevant bribe paid to Mr Ashe. 162 The section of the Complaint which contains an overview of the charges summarises the relevant bribery allegations in the following terms: In addition, ASHE received over $800,000 in bribes from various Chinese businessmen arranged through YAN and PIAO and, in return for these bribes, ASHE supported these businessmen's interests within the United Nations and with senior Antiguan government officials, including the country's then-Prime Minister … with whom ASHE shared a portion of the bribe payments. 163 Mr Garnaut and Fairfax again relied on the reference to "Chinese businessmen". As will be seen, however, the payment of $200,000 which was alleged to be connected in some way with CC-3 was alleged to have been made "in exchange" for Mr Ashe's appearance at a conference. Unlike the other alleged bribes, it was not alleged that the $200,000 payment was made in return for Mr Ashe's support for CC-3's interests within the United Nations or with senior Antiguan government officials. There is accordingly a disjunct between this part of the overview and the specific allegations concerning the $200,000 payment. 164 The Complaint contains a detailed section concerning the "relevant individuals and entities". There is no reference to the individual referred to as CC-3 in that section of the Complaint. 165 The detailed discussion of the various alleged bribes paid to Mr Ashe appears under a heading: "Yan and Piao arrange payments to Ashe in exchange for official actions on behalf of various Chinese businessmen". Mr Garnaut and Fairfax relied on the reference in that heading to the allegation that the payments were made on behalf of various Chinese businessmen. It is, however, again instructive to contrast how the different bribery allegations are particularised. A $300,000 payment to Mr Ashe is particularised under a subheading "Yan and Piao facilitate a $300,000 bribe to Ashe on behalf of a Chinese media executive" (emphasis added). Another series of payments are particularised under a subheading "Yan and Piao arrange additional payments to Ashe in exchange for official actions on behalf of a Chinese security company". The relevant $200,000 payment to Mr Ashe, however, is particularised under the subheading "Yan and Piao arrange for a $200,000 payment to Ashe in exchange for attending a conference in China in Ashe's official capacity". The subheading does not contain the allegation that the payment was made on behalf of CC-3. 166 Perhaps more significantly, when the factual allegations concerning the $200,000 are closely analysed, it is tolerably clear that there is no direct factual allegation that the payment was made on behalf of, or more importantly, with the knowledge of, or at the direction of, CC-3. Rather, the factual allegations concerning CC-3, at their very highest, involve hearsay assertions contained in a number of emails and other documents that were allegedly authored by Ms Yan and Ms Piao. 167 The first paragraph of the relevant part of the Complaint dealing with the factual allegations concerning the $200,000 is in the following terms: I also know from review of emails that after defendant JOHN W. ASHE became UNGA President, defendants SHIWEI YAN, a/k/a "Sheri Yan," and HEIDI HONG PIAO, a/k/a "Heidi Park," also arranged for a $200,000 payment to ASHE in exchange for ASHE making an official appearance at a conference in China being organized by a Chinese real estate developer ("CC-3"). Specifically, from my review of emails, bank documents, and other documents, I have learned the following: a. On October 18, 2013, PIAO emailed ASHE, with a copy to YAN, and told ASHE that PIAO and YAN had been working on obtaining additional funds for ASHE. PIAO told ASHE that "an old friend of Sheri who is extremely wealthy" was organizing an international conference in Guangzhou, China (the "Guangzhou Conference"), and that PIAO and YAN had suggested that ASHE be invited to the conference. PIAO attached a program for the conference that listed several current and former government officials as invited attendees, including ASHE. ASHE replied that the Guangzhou Conference was "very tempting indeed" and that he might make it, but that his entire "team" would need to accompany him. YAN replied to ASHE that she had "[j]ust talk[ed] to Heidi, she is going to write to you. In short, all the people who travel with you will be covered by the man and plus." PIAO then replied to ASHE that "[w]e are sure that he will cover the cost of your team," and requested information about ASHE's team and travel plans. b. On or about October 24, 2013, YAN emailed ASHE and PIAO and stated "[a]ccording to our strategy plan, [CC-3]'s office emailed me the invitation to John this morning … I will ask $200,000 for this trip. …" A few minutes later, YAN emailed ASHE, with a copy to PIAO, a draft invitation from CC-3 to ASHE to attend the Guangzhou Conference. YAN told ASHE that the invitation had been approved by CC-3, and YAN added that "[a]s you may see that I purposely add some words on future relationship between you and him, that will establish a good platform for you today and tomorrow." The draft invitation was addressed from CC-3 to ASHE as UNGA President and, in addition to inviting ASHE to the Guangzhou Conference, CC-3 stated that, "After attending this Summit, I wish that you would remember that you have a sincere friend in Guangdong Province - the economic powerhouse in China. And your friend here has the pleasure to offer you a permanent convention venue for the UN meetings on the sustainability and climate changes in the efforts to fully realize the Millennium Development Goals, as well as for the 193 members of the UN to convene for multilateral discussions on the topics of priority concerns." c. On October 27, 2013, PIAO emailed ASHE and YAN and told ASHE that "in order to have [CC-3] to wire the money to 68th PGA account, we suggest that you write a courtesy letter (in 68th PGA letterhead) to [CC-3] to accept his invitation, and in the letter also list out the name and title for all the people to be travelling with you, in order to make the logistic arrangement for them." The next day, ASHE emailed the "courtesy letter" to CC-3 suggested by PIAO. The letter was addressed to CC-3 from ASHE and was on official UNGA President letterhead. In the letter, ASHE told CC-3 he was pleased to accept CC-3's invitation to him and his team to attend the Guangzhou Conference. ASHE stated that at the conference ASHE would "deliver a statement on the topic of 'Identifying the Parameters of the Post-2015 Development Agenda.'" ASHE then listed four UN officials that would attend the conference with him and asked CC-3 to contact his special assistant to "finalize the logistical arrangements." d. On October 29, 2013, PIAO emailed ASHE and YAN and told ASHE that "in order to get the funding wired in ASAP," PIAO and YAN recommended that instead of asking CC-3 to contact ASHE's special assistant to make the "logistical arrangements," that ASHE revise his letter to CC-3 to ask that the arrangements be made through YAN. Later that day, PIAO emailed ASHE again, copying YAN, asking ASHE: "As for the $200K from [CC-3], which account would you like it to be wired to? The 68 PGA? Please advise." ASHE replied to PIAO and YAN that the money should be wired to the "PGA account" and attached a revised letter to CC-3. In the revised letter, ASHE told CC-3 to have his staff "contact my Adviser on Economic Matters, Ms. Shiwei Yan, to finalize the logistical arrangements for the trip." e. Later that same day, ASHE sent two "letters of appointment" to YAN and PIAO, which were back-dated to the prior month, September 2013. In one letter, on UNGA President letterhead, ASHE informed each of YAN and PIAO that they had each been appointed "Adviser, Economic Matters" in ASHE's office. In the other letter, on Antiguan government letterhead, ASHE informed YAN and PIAO that they had each been appointed as "Adviser to Office of the Prime Minister of Antigua and Barbuda on matters pertaining to investments in Antigua and Barbuda from the entire Asia region." In the email enclosing the letters, ASHE stated, "I believe these complete the outstanding requests that were made to me." f. On November 3, 2013, YAN emailed ASHE, with a copy to PIAO, telling ASHE that "Guangzhou has been wired 200k to PGA office today" and that "25k" had been wired to ASHE's travel agent. YAN also asked for the name of UN security personnel who would be traveling with ASHE to the Guangzhou Conference. On November 4, 2013, ASHE's PGA Account-2 received a $200,000 wire from China from one of CC-3's companies. That morning ASHE emailed YAN: "[c]an confirm receipt of $200k to the PGA." g. On November 17, 2013, ASHE attended the Guangzhou Conference. According to the agenda for the conference, ASHE gave a speech to the conference and then gave media interviews on global economic development. (Footnote omitted.) 168 As noted earlier, it could perhaps be said to be a fair or reasonable inference, that the reference to the "Chinese real estate developer" identified as CC-3 was a reference to Dr Chau. The evidence adduced in this proceeding, however, would tend to suggest that it was somewhat of an overstatement to say that the relevant conference was organised by Dr Chau. 169 Even if it is accepted that the reference to CC-3 is a reference to Dr Chau, the only references to CC-3 in the pertinent paragraphs of the Complaint are references derived from emails or other correspondence apparently drafted by Ms Yan, Ms Piao or Mr Ashe. It is not alleged that any of those documents was authored by CC-3, or that he even knew about them. Other than the hearsay references derived from the documents authored by other people, there is no direct allegation that CC-3 did or said anything, or specifically knew about, approved of, or directed the payment to Mr Ashe. As for the payment itself, the allegation is that Mr Ashe's bank account "received a $200,000 wire from China from one of CC-3's companies". It is not directly alleged that the payment was made on behalf of CC-3, or at his direction, or with his knowledge. 170 Mr Garnaut and Fairfax asserted that the letters "CC" referred to or denoted a co-conspirator. Mr Garnaut's evidence was that using the acronym "CC" for co-conspirator was "consistent DoJ [Department of Justice] usage". He did not, however, suggest that he had any particular insight, knowledge or experience of Department of Justice usage. Rather, he suggested that he made "quick investigations" concerning that matter. He did not detail what the "quick investigations" involved. 171 Even accepting that the acronym "CC" may refer to a co-conspirator, that in any event provided a very flimsy basis upon which to assert that CC-3, or Dr Chau, was alleged to be a co-conspirator in count one of the Complaint. That is particularly so given that CC-3 is not expressly identified as a co-conspirator in the actual particulars of count one, CC-3 had not been charged and, perhaps most significantly, the Complaint does not contain a single direct allegation that CC-3 did anything, said anything, or knew anything about the alleged $200,000 bribe paid to Mr Ashe. 172 Mr Garnaut also accessed and read a media release issued by the Department of Justice concerning the Complaint. That media release was issued on 6 October 2015. There was a link to the Complaint in the online version of the media release. It would appear that Mr Garnuat accessed the Complaint through that link. 173 Perhaps not surprisingly, the media release did not contain any information of particular significance beyond what was contained in the Complaint itself. It provided a brief summary of the allegations. Like the Complaint itself, the media release contained various general references to the alleged bribes being solicited or accepted from "businesspeople in China". That hardly provided a firm basis to conclude that Dr Chau was a party to any of the alleged offences. 174 As for the specific allegation concerning the relevant $200,000 bribe, the media release stated: In addition, YAN and PIAO arranged for ASHE to be paid $200,000 (plus travel expenses) in exchange for attending and speaking in ASHE's official capacity at a private conference in China hosted by a Chinese real estate developer identified as CC-3 in the Complaint. In addition to attendance at the conference, CC-3 also sought to "offer [ASHE] a permanent convention venue for the UN meetings on sustainability and climate changes … as well as for the 193 members of the UN to convene. …" 175 It should be noted that the quote concerning CC-3 was extracted from an email, referred to in the Complaint, which was not alleged to have been authored by, signed by, or sent by CC-3. It is, in any event, difficult to see the relevance of the allegation that CC-3 offered to allow the convention venue to be used for future UN meetings. 176 There was nothing in the media release to suggest any present intention on the part of the Department of Justice to charge CC-3, or any other person. The relevant United States Attorney was, however, quoted as noting that "the investigation is ongoing". Mr Garnaut appeared to give that statement considerable weight and significance. The media release did not give any reason or explanation for the fact that CC-3 or, for that matter, CC-1 and CC-2, had not been identified in the Complaint or the media release. 177 It should also be noted that the media release stated that the "charges contained in the Complaint are merely accusations, and [that] the defendants are presumed innocent unless and until proven guilty" and that "the entirety of the text of the Complaint and the description of the Complaint … constitute only allegations, and every fact described should be treated as an allegation". It would appear from the terms of the article that Mr Garnaut did not pay sufficient heed to those cautionary statements. They did not find their way into the article. 178 Mr Garnaut and Fairfax submitted that the Complaint and the Department of Justice media release "by themselves provided a reasonable basis for the views held by Mr Garnaut, and supported the allegations made in the [a]rticle". It will be readily apparent from the foregoing discussion that I do not agree. That submission has no merit and is rejected. A careful and considered reading of the Complaint and media release would or should have revealed to Mr Garnaut that, without more, there was no sound or reasonable basis to assert that Dr Chau had in fact been accused of bribery, or conspiracy to bribe, Mr Ashe, let alone that he had in fact bribed, or conspired to bribe, Mr Ashe. Nor did the contents of those documents provide a reasonable basis to assert that Dr Chau had acted in so seriously wrong a manner as to deserve extradition to the United States on criminal charges, including charges of bribery. 179 One final point should be made in the context of the Complaint and the Department of Justice media release. It would appear to be tolerably clear that Mr Garnaut did not, at any stage, seek to ascertain exactly why, if CC-3 was indeed Dr Chau, and Dr Chau was a co-conspirator, he had not been charged, or even named in the Complaint. He did not even attempt to contact the Department of Justice or the United States Attorneys who apparently had conduct of the case. 180 In his evidence, Mr Garnaut asserted that he did in fact turn his mind to the fact that Dr Chau had not been charged. He gave the following evidence: What did you think about that?---I thought there could be several reasons. One, it's possible that there was something really important that I couldn't see which is exculpatory. Yes?---Two, they - that the US authorities had - had charged and indicted the people that they could actually lay their hands on, who were physically in the United States at the time. They couldn't get them all to be in the United States at one time. Well, you can indict someone or charge someone without arresting them?---You can. Did you know that?---Yes, I did. But that would be - raise complicated questions of extradition which are almost impossible from China. And also most likely, in my personal point of view - from a personal point of view, I thought that this was likely to be a counterintelligence operation and that US prosecutors, the FBI in particular, would be very reluctant - may be very reluctant to reveal the source of their information or to give - to show their hands on a counterintelligence investigation. 181 The basis of Mr Garnaut's belief that the investigation and charging of Mr Ashe, Ms Yan, Ms Piao and others was a "counterintelligence operation" and that the prosecutors would accordingly be very reluctant to "show their hands" was, at best, unclear. There is certainly nothing in the Complaint or media release which provided any basis for this belief. 182 As for why he did not even attempt to contact the Department of Justice to ascertain what he could find out, Mr Garnaut gave the following evidence: Did you attempt to contact anyone at the Department of Justice?---No, I did not. Yes. Thank you?---I didn't think I would be able to make progress on that front. Did you make - you didn't think you would be able to make any progress. Why not?---Because - - - They had issued a press release?---They did. At that point, I didn't have contacts which were likely to divulge classified information to me. Sorry. They issued a press release. You could have rung the person who was the person named as the person who authorised the press release, couldn't you?---I could have. Now, from my long experience, I've never been - I've never gained much information from the person named at the bottom of any press released if I didn't know them. 183 It is difficult to see why Mr Garnaut's pessimism about whether he would have been able to obtain any useful information from the Department of Justice, including an explanation for why CC-3 had not been identified or charged, was really warranted. His claim that he had never gained much information from any person named at the bottom of a press release was likely to be an exaggeration. In any event, even if Mr Garnaut's pessimism may have been warranted, that does not adequately explain why he made no effort whatsoever to contact the Department of Justice, or anyone else who may have been involved in the relevant investigation and prosecution, in an attempt to obtain such information. The worst case scenario was that the response would be "no comment".

[28]

The apparent urgency to publish 184 Before addressing the investigations conducted by Mr Garnaut after he read the Complaint and media release, it is necessary to say something about the relatively short time frame in which those investigations took place and, perhaps more significantly, the reasons why that was so. 185 Mr Garnaut first became aware of the charges against Ms Yan early in the morning on 15 October 2015. He was in Delhi, India at the time. An article written by Mr Garnaut concerning those charges was published online at some stage during 15 October 2015. That article did not refer to Dr Chau. It would appear from email correspondence between Mr Garnaut and Mr Flitton that Mr Garnaut "hope[d] to piece something together on Dr Chau" for the next day. Internal emails between various Fairfax journalists, including Mr Garnaut, suggested that the plan to publish an article concerning Dr Chau was expedited when Mr Garnaut discovered that he had been "scooped" by a rival journalist who wrote for the Daily Telegraph newspaper. The Daily Telegraph article linked Dr Chau to the facts surrounding the charges. 186 Mr Garnaut's response to being "scooped", revealed in an email he sent to various Fairfax journalists, was to expedite the writing of an article about Dr Chau. In the email, he said: We were too clever by half, saving the big hit on Dr Chau for day 2. We're onto it, shall have something for you as soon as possible. 187 That email was sent at 6.58 am on 16 October 2015 (1.28 am in Delhi). The evidence suggests that Mr Garnaut's first draft of the article was circulated just under three hours later, at 9.55 am. There were various exchanges between Mr Garnaut and his direct editor at Fairfax, Mr Michael Bachelard, concerning the draft over the next few hours. One of Mr Bachelard's emails referred to "pressure to get this up asap". The article appeared online at 1.47 pm on 16 October 2015, just under seven hours after Mr Garnaut commenced work in earnest on the proposed "big hit" on Dr Chau. While it may readily be accepted that some of the investigatory work carried out by Mr Garnaut and others for the purposes of the previous day's article about Ms Yan was utilised in preparing the article about Dr Chau, the article was nevertheless investigated and drafted at what appears to have been breakneck pace. 188 The story concerning Dr Chau was undoubtedly significant and of considerable public interest. There was, of course, nothing wrong with Mr Garnaut and Fairfax endeavouring to draft and publish the article as soon as possible. The only apparent urgency, however, was that Mr Garnaut and Fairfax had been "scooped" by a rival media organisation. There is no doubt that the news media is a competitive business. It would be naive to think that competitive pressures do not at times influence the speed with which media articles are prepared and published. That said, the apparent haste with which the article was researched and published, and the reasons for that, are factors which are relevant to have regard to in the overall assessment of whether Mr Garnaut and Fairfax's conduct in publishing the article was reasonable in the circumstances. 189 It should also perhaps be noted in this context that Mr Garnaut's email exchanges with the Daily Telegraph journalist who had scooped him should have given Mr Garnaut pause for thought. After the journalist sent Mr Garnaut a link to his article, Mr Garnaut replied: "[h]ow do we know for sure Dr C is being investigated". The other journalist's reply was: "[f]uck they were supposed to cut that bit but check some ban Ki moon comments". The reference to "Ban Ki Moon" was somewhat obscure. Of more importance, however, is the fact that the journalist who had broken the story had given a fairly clear indication that he thought that there might be some issues with substantiating any claim that Dr Chau was in fact being investigated. Mr Garnaut appears to have missed that point.

[30]

Information sought from and provided by Mr Uren 191 One of the first sources of information for Mr Garnaut was Mr Uren, who was the husband of Ms Yan. Mr Uren was the "close associate … assisting Yan in New York" who was referred to in the article (at [45] and [46]) and who was reported to have said that "[t]he FBI and other officials here think that bribery goes with almost all Chinese" and that "Sheri would never do anything she knew was illegal or improper". As noted earlier, on one view of it at least, those statements could perhaps be seen as being exculpatory, not only of Ms Yan, but also of Dr Chau. 192 There could be little doubt that Mr Uren said the things attributed to the "close associate" in the article. Those statements were included in an email that Mr Uren sent to Mr Garnaut in the early morning of 16 October 2015. The information Mr Garnaut obtained from Mr Uren, at least according to Mr Garnaut, was apparently not limited to the two published statements. Mr Garnaut also said in his evidence that Mr Uren also told him: ... that the payment was for - that Chau paid $200,000 to John Ashe as a speaking fee. He said he didn't think it was a bribe. He thought it was payment for a speaking - for a speaking appearance. He said his wife's - Sheri Yan's involvement was minor. The transaction was between Chau and John Ashe. 193 That information, according to Mr Garnaut, caused him to leave the conversation "believing that there was no doubt in Roger Uren's mind that Chau was personally the source of these bribes and the invitation". This, in turn, appears to have been important in the formulation of Mr Garnaut's belief that Dr Chau had, or was at least likely to have, bribed Mr Ashe. 194 Mr Garnaut's reliance on Mr Uren as a source, and the conclusions he apparently drew from what Mr Uren told him, was and is problematic. That is so for a number of reasons. 195 First, the reliability of Mr Garnaut's version of his conversation with Mr Uren was, at best, doubtful. These additional observations by Mr Uren did not find their way into Mr Uren's email to Mr Garnaut. Mr Garnaut also did not retain any contemporaneous notes of the conversation. His evidence concerning the terms of the conversation he had with Mr Uren was far from compelling. Perhaps even more significantly, if Mr Uren did in fact tell Mr Garnaut that Dr Chau was the source of the "bribes and the invitation", and that the transaction was between Dr Chau and Mr Ashe, it is difficult to understand why Mr Garnaut did not include those statements in the article. That is particularly the case given that Mr Garnaut apparently accepted the reliability of Mr Uren as a source. 196 Second, the basis upon which Mr Uren asserted that Dr Chau was the source of the money, and that the "transaction" was between Dr Chau and Mr Ashe, was entirely unclear from the terms of the conversation. On Mr Garnaut's version of the conversation, Mr Uren did not tell Mr Garnaut that Ms Yan had told him either of those matters, or that he had any first-hand knowledge of the source of the payment. Mr Garnaut did not say that he asked Mr Uren the basis of his assertions about Dr Chau being the source of the alleged bribe. It should also be noted in this context that, in an email Mr Garnaut sent to Mr Flitton and others on 16 October 2015, Mr Garnaut said: "I spoke with Roger, don't think he knows what's going on". Thus, Mr Garnaut himself appeared to have doubts about the reliability of any information provided by Mr Uren about the alleged bribe. 197 Third, Mr Garnaut conceded that he was aware, at the time he wrote the article, that Mr Uren was not an entirely objective source of information because he was married to Ms Yan and "was trying to defend or justify his wife's actions". That, of course, was something that should have caused Mr Garnaut to question the reliability and objectivity of the information provided by Mr Uren, including the assertion that the relevant "transaction" was between Dr Chau and Mr Ashe and that Dr Chau was personally the source of the money. On one view, at least, that statement might reasonably have been seen as an attempt to shift the blame from Ms Yan to Dr Chau. 198 Fourth, Mr Garnaut did not reproduce, in his article, Mr Uren's statement that he believed that the payment was a speaking fee and did not think it was a bribe. Exactly why Mr Garnaut chose not to include that statement in the article was unclear on the evidence. That statement would have tended to be exculpatory, not only of Ms Yan, but also Dr Chau, if indeed he was said to be the source of the money that was paid to Mr Ashe as Mr Uren had supposedly claimed. It is hard to see how a person who simply paid what they thought was a speaking fee to a person who was invited to speak at a conference would necessarily be guilty of paying a bribe.

[31]

Information from "confidential source 1" 199 Mr Garnaut claimed to have relied on information provided by a person who he said had a "senior role in the Australian Government and [was] involved in international relations". Mr Garnaut declined to identify this source and claimed privilege pursuant to s 126K of the Evidence Act 1995 (Cth). This source was, so Mr Garnaut claimed, the source of the statement in the article that "some officials believe the highly connected Chinese tycoon may prefer to bunker down in his personal "imperial palace" just north of Guangzhou, beyond the reach of extradition treaties". As discussed in detail earlier, that statement would have conveyed to the ordinary reasonable reader that Dr Chau was conscious of his guilt in respect of the bribery allegations. It suggested that certain unnamed "officials" were aware of some information which suggested that Dr Chau was likely to take steps to avoid facing trial in the United States, as opposed to asserting his innocence and defending any charges that might be brought against him. 200 Mr Garnaut's evidence was that confidential source 1 told him that "his view was that Dr Chau must be extremely nervous about leaving the country and would be extremely reluctant to return to Australia while there was a risk of extradition". That was apparently the extent of the conversation. 201 The reliability of Mr Garnaut's evidence concerning his conversation with confidential source 1, the reasonableness of his reliance on that information and the reasonableness of including any statement concerning extradition in the article is discussed in detail later. It suffices at this stage to note that the reliability of Mr Garnaut's evidence concerning this source was, at best, highly doubtful. More significantly, even if the unnamed source did give Mr Garnaut his view about Dr Chau's nervousness about extradition, the reliability of that information and the reasonableness of Mr Garnaut's reliance on it is at best highly questionable. The assessment of the reasonableness of Mr Garnaut's reliance on the information supposedly provided by confidential source 1 is complicated by the paucity of information before the Court about confidential source 1. It is, in those circumstances, almost impossible to assess whether the views apparently expressed by confidential source 1 amounted to mere speculation, or were based on some objectively reliable information in their possession.

[34]

The fear of extradition assertions 206 The assertion that Dr Chau "may prefer" to "bunker down" in China "beyond the reach of extradition treaties" was a critical element of the article. It provided the "local angle", in particular the reference to Dr Chau's purchase, "sight unseen", of the Packer mansion in Vaucluse. It bookended the article; appearing at the very beginning and very end of the article. For the reasons already given, it also tended to convey to the ordinary reasonable reader consciousness of guilt on the part of Dr Chau. That tended to elevate allegation or suspicion to guilt, even in circumstances where Dr Chau had not been charged or even named in the Complaint. 207 Was it reasonable, in all the circumstances, to make that assertion? Was there a sound and reliable basis to make it? 208 To answer those questions, it is first necessary to first assess the credibility and reliability of Mr Garnaut's evidence concerning confidential source 1. That, however, is not the end of the matter. Even if it is accepted that confidential source 1 gave Mr Garnaut the information Mr Garnaut claimed he did, it is nevertheless necessary to assess the reliability of that information and the reasonableness of Mr Garnaut's reliance on it. 209 The reliability of Mr Garnaut's evidence concerning his conversation is, at best, doubtful. That is so for a number of reasons. 210 First, Mr Garnaut apparently did not make or retain any contemporaneous note of the conversation that he said he had had with confidential source 1. Nor is the content of that conversation referred to, or even hinted at, in the extensive documentary record of the research and investigation of the story, including the email and other communications between Mr Garnaut and his editor and fellow Fairfax journalists during the course of the investigation and up to the time of publication. There is one redacted reference to a person who was, according to Mr Garnaut at least, confidential source 1 in the email communications, though that email simply records that Mr Garnaut "[g]ot a call from [redacted] they're suitably (but quietly) terrified". There is nothing in the documentary record which evidences or refers to a source, confidential or otherwise, claiming that Dr Chau might plan to remain in China to avoid extradition. 211 Second, the first reference in the record of communications to Dr Chau fearing extradition is in an email from Mr Garnaut to Mr Bachelard and others, shortly after Mr Garnaut discovered that he had been "scooped" by a rival journalist. In that email, Mr Garnaut appeared to pitch his proposed story about Dr Chau to Mr Bachelard. Even at that very early and preliminary stage, Mr Garnaut's pitch for the story included the extradition assertion. The pitch began with the statement that: "Chau is possibly stuck forever now in [C]hina, to avoid extradition, so he'll never get to sleep in his 70m James Packer pad". Mr Garnaut did not suggest in his correspondence with Mr Bachelard that his extradition "angle" had been derived or buttressed by information obtained from any independent source. Mr Bachelard was enthusiastic about the extradition angle. He replied to Mr Garnaut and agreed that the "idea of Chau never being able to live in the 70 million Packer pad also has cut through". Mr Bachelard did not ask Mr Garnaut whether he had any independent source for this angle. Thus, the extradition angle was firmly entrenched from the very earliest stage; not because any source had provided that information, but because it provided "cut through". 212 Third, Mr Garnaut sent an email containing the first draft of the article to Mr Bachelard at 9.55 am on 16 October 2015. Mr Garnaut indicated that he welcomed edits, comments, or improvements to the draft and asked Mr Bachelard to "arrange lawyering". The first draft contained the following references to extradition: Dr Chau Chak-Wing may never get to live in the $70 million Vaucluse mansion which he bought from James Packer, sight unseen. He may prefer to bunker down in his personal "Imperial Palace" just north of Guangzhou, beyond the reach of extradition treaties, if US authorities decide to take action against the billionaire businessman they describe as "CC-3" in a bribery indictment against the former president of the UN General Assembly, John Ashe. … Chau has not been charged with any offence. He hasn't even been explicitly identified in [sic] prosecutors. But it may be safest for the billionaire to bunker down in China away from the reach of extradition treaties while we all learn whether the extraordinary Kingold kingdom of Australia and China relations was built upon illicit payments and hot air. 213 It is noteworthy that there is no suggestion that any "officials" had expressed the view that Dr Chau may prefer to "bunker down" in China to avoid extradition, or that remaining in China may be "safest". Indeed, the clear impression conveyed was that it was the author's view that it might be preferable or safest for Dr Chau to stay in China to avoid extradition. There was no suggestion that the author's view was based on any information provided by any "officials". If Mr Garnaut had spoken to confidential source 1 by this time, it seems extremely difficult to accept that he would not have included that information in the first draft, particularly given the prominence given to the assertion concerning extradition. 214 The draft was altered in a number of ways as a result of various exchanges between Mr Garnaut and Mr Bachelard over the following few hours. None of the changes materially altered the assertion that Dr Chau may remain in China to avoid extradition. Indeed, if anything, the changes resulted in the strengthening of the assertion. Certainly, none of the changes suggested that the assertion was based on information provided by any official or officials, or that the view about Dr Chau remaining in China to avoid extradition was one held by an official or officials, not just the author. 215 Even more remarkably, the version of the article that was first posted online at 1.47 pm on 16 October 2015 did not state that the view that Dr Chau may "bunker down" in China was held by "some officials". There was no indication that that view was held by anyone but the author. It was not until 2.18 pm on 16 October 2015 that Mr Garnaut sent an email to a fellow Fairfax journalist and said "[i]f this is not yet live, can I suggest the changes in bold". The changes in bold included the addition of the words "some officials believe" in paragraph 5. No explanation was given in the email for that last minute addition. 216 Mr Garnaut was cross-examined about the addition of the words "some officials believe" and why that was done at the heel of the hunt, so to speak. His evidence was as follows: You see, by this time, Mr Garnaut, you had written or okayed at least three versions of this story that did not have the reference to "some officials"?---Yes. And even though you may not have known it, the story had been published without those words in it; correct?---That seems to be correct. Yes. Why did you choose to add them at this point, as it were, at the heel of the hunt and not earlier?---Because I rarely come up with, you know, the perfect formulation of words on the first go, so, upon reconsidering, I thought it was important to be as precise as I could. You see, your motivation in actually adding this was to give an additional air of credibility to the assertion that you had previously made about my client hiding because he was frightened of being extradited; that's why you put it in, isn't it?---I actually thought it went the other way as well, more importantly, but this is the expression of some people. This is not an objective fact plucked from the air. Yes. But don't you think that it gives additional force to say that it comes from a government official than from a journalist?---I think it adds clarity and precision. Look, I could go either way. I would actually go the other way, that it shows that this is not objective fact, it's the point of view of some people. 217 Mr Garnaut was then asked questions about confidential source 1. It was at that point that Mr Garnaut claimed privilege on the basis that his answers may tend to identify his source. He was not prepared to answer any questions beyond confirming that the official was an "Australian public servant" who he had known for a "long period of time". He appeared to claim that the official had a "long knowledge" of Dr Chau, but declined to indicate whether the official had ever met Dr Chau. It should be noted, in this context, that in his evidence-in-chief, Mr Garnaut had said the official "had a senior role in the Australian Government and [was] involved in international relations", that "his role in the Australian Government had been following this case closely" and that his "impression was that he [the official] had visibility over justice-related communications between the Australian Government and the US Government". He was not so forthcoming when pressed in cross-examination about the last minute change to the article. 218 Mr Garnaut's explanation for not having referred to the unnamed "officials" until after the article had been initially published online was hardly persuasive. Indeed, in all the circumstances it was implausible and unsatisfactory. The extradition angle was a prominent and important part of the story. Given that importance, it would have been particularly important to include the independent source, if there was one, for the assertion that Dr Chau might remain in China to avoid extradition treaties. There could be little doubt that the inclusion of an apparently "official" source would tend to add some credence and an air of credibility to that assertion. In those circumstances, Mr Garnaut's claim that he did not include the source because he rarely came up "with … the perfect formulation of words on the first go" is scarcely credible, particularly as he and Mr Bachelard had exchanged views and suggestions about earlier drafts of the article. It is difficult to accept that he simply forgot to include it. His claim that the inclusion of the reference to the "officials" may actually have given the assertion less force to the assertion was even less credible. Without the reference to "officials", the ordinary reader would have seen the assertion as simply being the author's view or speculation. 219 Was Mr Garnaut being entirely truthful concerning his conversation with the unnamed Australian government official and the last minute addition to the article? Was Mr Garnaut really told by that official that he, and supposedly one or more of his colleagues, were of the view that Dr Chau may prefer to "bunker down" in China rather than face extradition? Those are not easy questions to answer. Ultimately, however, I am not persuaded that Mr Garnaut was being entirely truthful about those matters. 220 The complete absence of any contemporaneous documentary record of his supposed conversation with this official, even in some redacted or coded format, is surprising. The fact of the communication is also not even hinted at in any of the emails between the key Fairfax journalists and their editor during the course of the investigation and preparation of the drafts of the article. That means that Mr Garnaut's evidence about the conversation was entirely uncorroborated. More significantly, the documentary record of the genesis of the article suggests that, at all times up to, and even after, the first posting of the online story, the view that Dr Chau might prefer to remain in China to avoid extradition was couched in terms which suggested that it was Mr Garnaut's view. It was a view that was seen as particularly important from the outset because it provided "cut through" and a local connection in the form of the purchase of the Packer mansion. Mr Garnaut's explanation concerning the last minute addition of the reference to "some officials" was far from convincing or credible. 221 While it was of course perfectly open to Mr Garnaut to claim privilege in respect of any information which might tend to identify his supposed source, and no adverse inference can or should be drawn against him for making that claim, Mr Garnaut's apparent unwillingness to reveal even the most basic information about the official left the Court in the unenviable position of having to determine the reliability and credibility of his evidence on the basis of very limited and incomplete information. Be that as it may, on the evidence as a whole, I am simply not satisfied that Mr Garnaut's account concerning the provision of this information was reliable or credible. 222 In any event, and perhaps more significantly, even if it be accepted that Mr Garnaut did have the conversation with confidential source 1 as he claimed, the paucity of information about the unnamed official, and the complete absence of any real detail about the basis of the official's view and the information that he had available to him, makes it almost impossible for the Court to assess the reliability of the source and the reliability of the view expressed by the source. It is, in those circumstances, difficult to accept Mr Garnaut and Fairfax's claim that they acted reasonably in including the references to Dr Chau's fear of extradition in the article. Fairfax and Mr Garnaut, of course, bear the onus of proving that their conduct in publishing was reasonable. 223 The following points may be made in relation to the reasonableness of including in the article the references to Dr Chau's fear of extradition. 224 First, whether or not Dr Chau might actually prefer to "bunker down" in China rather than face the risk of extradition was something likely to be known only by Dr Chau or someone who had been spoken to by Dr Chau about this issue. There is no evidence that the unnamed official had discussed this with Dr Chau. Certainly Mr Garnaut did not say that he had asked the official whether he had discussed with Dr Chau his supposed fear of extradition, at least on the version of the conversation he gave in evidence. 225 Second, if confidential source 1 had not spoken to Dr Chau concerning his attitude to the investigation, the views expressed by the official were likely to amount to little more than speculation based, perhaps, on his supposed knowledge of the investigation. Indeed, the terms of the information provided by confidential source 1 - that Dr Chau "must be extremely nervous" and "would be extremely reluctant to return to Australia" tend to suggest that the official was simply speculating. To make matters worse, there was not even any evidence to suggest that confidential source 1 in fact had reliable first-hand information about the investigation. Nor did Mr Garnaut ask him if he did. 226 Third, on the basis of the limited evidence Mr Garnaut gave concerning confidential source 1 and the conversation he had with him, it is difficult to accept that Mr Garnaut had any reasonable basis to believe that the official's view amounted to anything more than mere speculation. It is no answer to this that the official was apparently involved in some way in "international relations" and had supposedly been following the case closely. Nor does it assist that Mr Garnaut had the "impression" that the official may have had "visibility" over "justice-related communications" between the Australian Government and the United States Government about the case. It does not follow that the Australian Government, or any of its officials, in fact had communicated with the United States Government about the case, or otherwise had any first-hand knowledge of the investigation. It is difficult to see why the United States government or any of its officials would be communicating with Australian officials about a bribery case which had no apparent link with Australia. Moreover, if Mr Garnaut genuinely believed that the official had any first-hand knowledge of the investigation, it is surprising that he did not ask him why Dr Chau had not been charged or even named in the indictment. Yet he apparently did not. 227 Fourth, there is no evidence to suggest that Mr Garnaut asked confidential source 1 anything with a view to ascertain the source, basis or reliability of his view. In light of the nature of the information, which as discussed earlier appeared to amount to little more than speculation, if Mr Garnaut wanted to include the information in the article, it was unreasonable for him not to seek to ascertain the basis and source of the official's view. That is so even if the basis and source of the view may not have been able to be published so as to protect the official's identity. 228 In all the circumstances, I am not persuaded that it was reasonable to include in the article the assertion that Dr Chau may "bunker down" in China so as to remain beyond the reach of extradition treaties. I am not satisfied that Mr Garnaut in fact had a reliable independent source for that assertion and, even if he did, I am not satisfied that the view expressed by the source amounted to anything other than mere speculation. Nor am I satisfied that Mr Garnaut had any reasonable grounds to believe that the view amounted to anything more than mere speculation. 229 It should be reiterated, in this context, that the assertion about fear of extradition was a significant theme of the article. Not only did it bookend the article, it provided the local angle, and supposedly justified the inclusion of the photograph of Dr Chau's "Vaucluse mansion" and the rather sneering assertion that it had been bought by Dr Chau "sight unseen". More importantly, as discussed in detail earlier, the extradition assertion conveyed to the ordinary reasonable reader a consciousness of guilt on the part of Dr Chau. It accordingly tended to imply guilt. Considerable care and caution should have been exercised before including it in the article. I am not satisfied that appropriate care or caution was exercised. The main consideration for Mr Garnaut and Fairfax appeared to be the inclusion of a local angle and the sensationalism that went along with it. 230 The making of the assertion relating to Dr Chau's fear of extradition in such circumstances is a highly relevant consideration in determining whether the conduct of Mr Garnaut and Fairfax in publishing the article was reasonable in all the circumstances.

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The alleged "scrubbing" of websites 231 Similar issues exist in relation to the assertion that, since the arrest of Mr Ashe and Ms Yan, "offending" Kingold web pages which had "trumpeted" Mr Ashe's appearance at "Chau's resort" had been "scrubbed from cyberspace". Like the fear of extradition assertion, the "scrubbing" assertion tended to convey a consciousness of guilt on the part of Dr Chau, as well as a supposed attempt to conceal potentially incriminating or damaging evidence. Yet close examination of the evidence suggests that there was no reasonable basis for the assertion. 232 The evidence revealed the following events concerning the so-called "scrubbing" of the "offending" web pages. It should perhaps be noted that it is by no means possible to be absolutely certain about the precise chronology because the email chains that form the bulk of the evidence are not only confusing, but contain time stamps from various different time zones. Mr Garnaut was in Delhi at the time. While a bundle of documents, mostly emails, which was said to be in chronological order was tendered, the precise chronology of the emails and surrounding events was never fully or clearly explored in the evidence of Mr Garnaut and Mr Flitton. 233 At some stage on the evening of 15 October 2015, Mr Garnaut sent an email to Mr Flitton and Mr Wen in which he stated that he had "contacted Dr Chau's offsider when we were [sic] a chance to run his links, and of course they've immediately scrubbed the web". Mr Garnaut provided details of a particular web page and asked Mr Flitton to "use your web archaeology software" to retrieve the page. Mr Garnaut's evidence was that, after speaking with Dr Chau's assistant, but prior to sending the email to Mr Flitton, he had gone to the Kingold website to look for the web page that described the conference at Dr Chau's resort and found that the web link was "dead". He claimed that he had seen that web page "[n]ot long before" communicating with Dr Chau's assistant. 234 Mr Flitton replied to Mr Garnaut's email and stated that the link or web address that Mr Garnaut had provided was not in the "immediate archive", but that he would "try others". He asked Mr Garnaut for a "hint" of what he was looking for. Mr Garnaut's apparent response was that if you "google 'John Ashe' [and] Chau Chak Wing you'll find a whole graveyard of excavated websites". It is unclear exactly what Mr Garnaut meant by the expression "graveyard of excavated websites". He did not explain it in his evidence. He did not say that any of the websites in the "graveyard" were part of, or associated with, the Kingold website, or that they had been removed or deactivated in recent times. In any event, by this time it would appear that, insofar as the Kingold website was concerned, Mr Garnaut had only found one link which was "dead". It does not appear that he was in any real position to determine when that link had been made dead, despite his apparent claim that he had found it to be active not long before. 235 Despite the relatively rudimentary searches he himself had conducted, it would appear that, from a fairly early stage, Mr Garnaut had concluded that a large number of web pages, if not all the web pages, relating to the conference were no longer live. In an email sent to Dr Chau's assistant at 9.49 pm Delhi time, Mr Garnaut asserted that "somebody has scrubbed all the websites" (emphasis added). The basis of the assertion that all the relevant websites had been scrubbed was at best unclear. Despite his initial, rather hasty, view on the topic, Mr Garnaut appears to have delegated the responsibility to research the websites and website archives to Mr Flitton. 236 Mr Flitton's evidence was that, on the evening of 15 October 2015, he conducted research on the internet to locate web pages which contained details of the relevant conference. He located some live links and also found a number of archived links using software called the "Wayback Machine". Unaided by documents, Mr Flitton appeared unable to say which websites he found were still "live" or active, and which he was only able to find using the Wayback Machine. He accepted, based on his email response to Mr Garnaut, that he "would have" clicked on the link that Mr Garnaut had provided and "[it] would have been a dead link", though his evidence was far from emphatic in that regard. He did not unequivocally say that, in the course of his research, he found any other "dead" links relating to the conference on or associated with the Kingold website. 237 While Mr Flitton's evidence about which websites were live, and which were not, when he conducted his research may have been rather equivocal and unclear, the documentary evidence clearly indicates that there were still some live links concerning the conference on the Kingold website at the relevant time. 238 At 10.08 pm (Sydney time) on 15 October 2015, Mr Wen sent an email to, it appears, Mr Garnaut and Mr Flitton, which included a link to a Kingold web page. That web page was apparently still live and included, in Chinese, information about the relevant conference. In his email, Mr Wen said: "[h]ad saved this earlier, looks like this link is still good". It would appear to follow that, despite Mr Garnaut's initial location of one apparently "dead" link on the Kingold website, there was still an active link on the Kingold website which contained information about the conference. 239 At 10.11 pm (4.41 pm Delhi time) on 15 October 2015, Mr Flitton replied to Mr Wen's email. Mr Garnaut was copied in. Mr Flitton stated: Good one. I've got an English version of the same. That SME website has been taken down good and proper. very hard to recover, but I've got agenda and participants from here: http://summit.kingold.com/en/event-20131117.html. 240 The SME website, referred to by Mr Flitton, was not a Kingold website. It was the conference website, or the website of the organisation which held the conference, the "Global Alliance of SMEs [small and medium-sized enterprises]". That website appears to have been "globalsmes.org". Mr Flitton did not suggest that any Kingold website had been "taken down". Indeed, his email suggested quite the opposite. The email attached material which, based on the web address appearing at the foot of many of the pages, was plainly from the Kingold website. That material directly related to the conference, including Mr Ashe's appearance at it. Mr Flitton agreed, in cross-examination, that the material attached to his email was most likely still "live on the web" when he downloaded or printed it. 241 In a later email to Mr Garnaut, Mr Flitton reiterated that the "globalsmes.org site is dead", but that he had "saved versions of the [K]ingold site of the Nov 13 conference". He did not state that the Kingold site was "dead", or that he had to extract it from an archive using the Wayback Machine. The web address on the document attached to Mr Flitton's email tends to indicate that the site or link from which it had been downloaded or printed was still live and was not an archive version extracted using the Wayback Machine. 242 When cross-examined about whether those later emails from Mr Flitton indicated that there were still live links relating to the conference on the Kingold website, Mr Garnaut essentially evaded the question and said simply that he was "deferring" to Mr Flitton and relying on the information he was providing. Nevertheless, Mr Garnaut ultimately appeared to accept that he understood at the time that there were at least some live links. He also appeared to accept that, if there had been any "scrubbing", it had been the scrubbing of the SME websites and that it was "quite possible" that he had misinterpreted Mr Flitton's emails. He nonetheless, rather defiantly, if not petulantly, maintained that the statement that "most of the web pages have been scrubbed from cyberspace" was true. It is difficult to see how that could possibly be said to be the case. 243 The article clearly conveyed or at least implied that "most" of the web pages on Kingold's website that had referred to Mr Ashe's appearance at the conference at Dr Chau's resort had been "scrubbed" following the arrest of Mr Ashe and Ms Yan. The use of the word "scrubbed" conveyed or connoted that the web pages had been deliberately removed with a view to concealing any relevant link between Dr Chau and Mr Ashe. There was, however, no reasonable basis for that serious assertion. 244 It should also perhaps be noted in this context that Mr Garnaut accepted that the word "scrubbed" had no technical meaning. He said that he used that word because it was "a more interesting word than "removed"". That rather smug response belied the fact that the word "scrubbed" plainly had negative connotations. It is a fair inference that that was precisely why Mr Garnaut used it. 245 Even if it be accepted that Mr Garnaut had found one apparently relevant link on the Kingold website which was no longer active, it does not follow that it was deliberately removed for the purpose of concealing any link between Dr Chau and Mr Ashe. Indeed, the fact that there remained live links concerning the conference on the Kingold website, including links which contained the list of participants and speakers, including Mr Ashe, as well as photographs of speakers, including Mr Ashe, would clearly suggest that there was no deliberate "scrubbing" of "offending" web pages. If there had been, all the relevant links would have been taken down. The fact that the SMEs website was no longer active was entirely irrelevant, particularly in the absence of any evidence that it was taken down in the immediate aftermath of the charging of Mr Ashe and Ms Yan, or that Dr Chau had anything to do with that website, or with any decision to take it down. 246 The making of the "scrubbing" assertion in such circumstances is a highly relevant consideration in determining whether the conduct of Mr Garnaut and Fairfax in publishing the article was reasonable in all the circumstances.

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Mr Garnaut's contact with Mr Zheng 248 At some time during the day on 15 October 2015, Mr Garnaut telephoned Mr Zheng, who was one of Dr Chau's assistants. It would appear that Mr Zheng was based in Australia, though it is unclear where he was at the time of the phone call. Mr Garnaut claimed that Mr Zheng was Dr Chau's "gateway … to the … English-speaking world" and had been his (Mr Garnaut's) "long-running conduit to Dr Chau over many years". The latter claim may well have been an exaggeration given that the evidence suggested that Mr Garnaut had only had a limited number of contacts with Dr Chau and they mainly occurred in the period 2009 to 2011. In any event, Mr Garnaut's evidence was that, during his telephone call with Mr Zheng, he said: "Jim, there is a United Nations bribery investigation which appears to … identify Dr Chau as the source of [the] bribes" and that "the Department of Justice … says on this indictment that he was the source of a $200,000 bribe to the President of the General Assembly John Ashe for a summit held at his resort". Mr Zheng replied: "Oh I see. Could you please put this in an email - put the details in an email". 249 At 6.40 pm on 15 October 2015 (New Delhi time; about 12.10 am on 16 October Sydney time), Mr Garnaut sent an email to Mr Zheng. The email contained the subject heading "[h]ere is the link Jim" and included a web link to the Department of Justice media release concerning the charges against Mr Ashe, Ms Yan and others. It will be recalled that the media release in turn had a web link to the Complaint. In the body of the email, Mr Garnaut said: I believe "CC-3" is Dr Chau. We all knew Sheri well. Does this make any sense to you? 250 It would appear that Mr Garnaut did not receive any immediate response to the email. If Mr Zheng was in Australia at the time, it is perhaps hardly surprising that he did not immediately reply, as it was in the middle of the night. In any event, about three hours later, Mr Garnaut sent a further email to Mr Zheng in the following terms: It looks like somebody has scrubbed all the websites that talk about Dr Chau hosting John Ashe at the Nov 13 UN summit, as described in the indictment. Nevertheless, we will have to identify CC-3 as Dr Chau. This is serious, please consider your response as soon as possible. I don't think there's anyway of ducking the fact that Dr Chau is accused of bribing John Ashe via Sheri Yan. The best thing is to consider whether is [sic] accusation is wrong, whether he will dispute it, or whether he will make himself available to US investigators. I know this isn't easy for any of you, but I don't think it can just go away. 251 Mr Garnaut did not receive any response to this email in the approximately 12 hour period before the online publication of the article at 1.47 pm Sydney time on 16 October 2015. 252 Dr Chau's evidence was, in effect, that he did not receive any communication from Mr Zheng on 15 October 2015. Indeed, he initially appeared to have difficulty recalling or comprehending who Mr Zheng was and whether he was his assistant at the time. Some of that difficulty may have arisen from transliteration problems and the differences between Mr Zheng's English language name and his Chinese name, which was Zheng Wu. That said, there was evidence independent of Mr Garnaut that Mr Zheng was Dr Chau's relatively long-standing assistant and a point of contact for people in Australia who dealt with Dr Chau. Dr Chau's initial inability to comprehend who Mr Zheng was did not reflect well on him or the reliability of some parts of his evidence. It suggested that for some reason or other he wanted to distance himself from Mr Zheng and any communication that Mr Garnaut may have had with him. 253 In any event, Dr Chau's evidence was that the first he heard anything about the subject matter of the article was when his daughter contacted him after the article had been published. At first blush, it would appear to be surprising, if not implausible, that Mr Zheng would not have immediately brought his communications with Mr Garnaut to Dr Chau's attention. It may be accepted that Dr Chau was a busy man and that not every contact made by a journalist would necessarily be immediately be brought to his attention. Nevertheless, the matters that Mr Garnaut raised with Mr Zheng were undoubtedly very serious and required urgent attention. It is difficult to imagine that Mr Zheng could or would have thought otherwise. It is, in all the circumstances, difficult to accept that either Mr Zheng, or somebody else in the Kingold organisation, would not have alerted Dr Chau to the contact from Mr Garnaut. 254 It should also perhaps be added that Dr Chau did not call Mr Zheng to give evidence in his case. There was evidence that Mr Zheng still worked for the Kingold group and had spoken with Dr Chau on the day before he gave evidence, though they did not discuss the case. If there was a legitimate explanation for why Mr Zheng could not, or did not, bring Mr Garnaut's communications to Dr Chau's attention on 15 or 16 October, it would have been open to Dr Chau to call Mr Zheng to give evidence of that explanation. In the circumstances, it might reasonably be inferred that any evidence that Mr Zheng may have been able to give on that subject would not have assisted Dr Chau: Jones v Dunkell (1959) 101 CLR 298. 255 Putting this rather unsatisfactory aspect of Dr Chau's evidence to one side, at least for the moment, there are some additional observations which should be made concerning the adequacy or reasonableness of Mr Garnaut's contact with Mr Zheng as a means of obtaining Dr Chau's response to the proposed story. 256 First, it may be accepted that it was reasonable, at least in the first instance, for Mr Garnaut to attempt to obtain Dr Chau's side of the story by contacting his assistant, Mr Zheng. 257 Second, some of what Mr Garnaut told Mr Zheng, both during the telephone conversation and in the email, was not entirely accurate. There was no "United Nations bribery investigation". It was an investigation by the United States Federal Bureau of Investigation. It was also not entirely accurate to say, as Mr Garnaut apparently did during the telephone conversation, that the investigation identified, or appeared to identify, Dr Chau as the source of the bribe. At its highest, the Complaint alleged that the $200,000 came from one of CC-3's companies. Perhaps more significantly, Mr Garnaut's assertion, in his email, that somebody had "scrubbed all the websites" was, at best, an exaggeration and most likely a misrepresentation of the true state of affairs. The assertion that Dr Chau had been "accused of bribing John Ashe via Sheri Yan" was also incorrect. No such accusation had been made. 258 Third, Mr Garnaut did not put Mr Zheng on notice, in either his telephone conversation or in the email, of some of the key elements of his proposed story. Perhaps most importantly, he did not ask for any response to the assertion that Dr Chau might remain in China beyond the reach of extradition treaties. As discussed earlier, that was a key theme of the story from the very outset. Nor, for that matter, did Mr Garnaut seek any response to the theory ultimately propounded by the story that the bribery allegations might reveal whether the "extraordinary Kingold kingdom of Australia and China relations was built upon illicit payments and hot air". 259 Fourth, while it may be accepted that Mr Garnaut received no reply to the email prior to publishing the article, he allowed only a period of about 12 hours for Mr Zheng to contact Dr Chau and obtain a considered response to what were plainly very serious allegations. It is at least open to question whether that was a reasonable or adequate time in which to expect a response, particularly given that, due to time zone differences, at least part of that period was in the very early hours of the morning in both Australia and China.

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Mr Garnaut's conversation with Ms Chow 260 It is not entirely clear why Mr Garnaut contacted Ms Chow in relation to the allegations. There was no suggestion that she knew anything about the bribery allegations, or knew anything about any connection that her father might have had to those allegations, or was in any position to speak on her father's behalf in providing any response to the proposed article. There was no evidence that Ms Chow knew Mr Garnaut or had ever spoken with him before. Mr Garnaut called here "cold", without any warning or introduction. It is, in all the circumstances, difficult to see the basis upon which Mr Garnaut apparently believed that Ms Chow would be in any real position to give any meaningful response to the proposed article during the telephone call. 261 Mr Garnaut's recollection of the terms of his conversation with Ms Chow was plainly less than perfect. It does not appear that he made or retained any notes of the conversation. When first asked about the terms of the conversation, he gave the following evidence: I told her that he[r] father was implicated as the source of a $200,000 bribe to the President of the General Assembly, John Ashe, for a summit - to appear at a summit held at her father's resort. I asked her if she knew about that … … She said to me that this was a misunderstanding and that she would issue - they would be issuing a statement to clarify things shortly. 262 Mr Garnaut's evidence was that the "line" then cut out. He said that he then tried to call back and could not get through. He did not receive any call back from Ms Chow. 263 When asked about the conversation during cross-examination, he gave a rather different version. His evidence was: What did you actually say to her, that you were checking or investigating? What did you ask her?---Look, I - I don't want to falsely reconstruct a conversation that was a long time ago, but to the effect of, "There is this UN bribery investigation. Your farther is - I understand that your father is CC-3 in this document," and a little bit more explanation, which I'm not going to - - - HIS HONOUR: Did you ask her if she had seen the document?---No, I didn't ask her that. Well, if she hadn't seen the document, how would she know what the significance of being called CC-3 in a document that she hadn't seen? How could she possibly say anything meaningful in response to that?---Look, I don't want to falsely reconstruct, you know, my conversation. Do the best you can?---Yes, okay. I believe I would have, and I did, explain that there was an indictment that named her - that talked about CC-3 as being the source of bribes to the - to the President of the United Nations General Assembly and I believed, and wanted to check, that her father was CC-3. 264 Ms Chow's version of the conversation was different again. Her evidence was that she received the telephone call from Mr Garnaut when she was in a car travelling on a highway from Guangzhou to her father's resort. There were telephone reception difficulties on that highway "[a]ll the time". Her evidence about the conversation was: Now, do you recall the - what you said to Mr Garnaut and what Mr Garnaut said to you in the course of the conversation which you had with him on this occasion?---Not the whole conversation. But, briefly, he rang me. He called me out of the blue, and he asked if I were aware of the media. And he asked whether CC-3 is my dad, and he also asked where I am. So I said to him I go - I was on holiday, and I'm travelling. On holiday and - - -?---Travelling. Travelling?---Yes. What did you - did you give any answers to the other questions that he asked you?---No, cause I have - I - cause - as I was on holiday, I was - I have no idea what's going on. So I said to him that the whole thing is a misunderstanding, and we were going to be issuing a statement to clarify. 265 In cross-examination, Ms Chow agreed that she had told Mr Garnaut that she was proposing to make a statement and give an explanation, but that she also said it was a "misunderstanding because I have no idea what was happening at that time". When pressed about what she meant when she said "misunderstanding", Ms Chow said "because I have no idea of what's happening in the event and I have no direct involvement and when a journal [sic] call me when I was travelling, that's all I can think of to say". 266 Mr Garnaut plainly drew an adverse inference against Dr Chau based on his conversation with Ms Chow and her apparent inability to provide any meaningful immediate response to his assertions or queries. Indeed, it appeared to confirm his view that Dr Chau had indeed bribed Mr Ashe. In an email that Mr Garnaut sent to Mr Flitton and Mr Wen at 10.39 pm (New Delhi time) on 15 October 2015, Mr Garnaut said: "Spoke with Winkie… He's fucked". In his evidence, he explained that what he meant by that profanity was that "we have much stronger grounds for believing that there is no innocent explanation that's going to be forthcoming". That explanation gives the word "fucked" a whole new meaning. In any event, Mr Garnaut claimed that he reached that conclusion because Ms Chow said that the whole thing was a misunderstanding, that she would issue a statement and that she appeared flustered and had hung up the phone. 267 The adverse inference drawn by Mr Garnaut was, however, plainly not a reasonable inference to draw in all the circumstances. That is so for a number of reasons. 268 First, as already indicated, Mr Garnaut had no reasonable basis to assume or infer that Ms Chow knew anything about the bribery allegations, or her father's alleged connection with them, or that Ms Chow was in any position to immediately respond to Mr Garnaut's assertions. It should also be added, in this context, that the information that Mr Garnaut relayed to Ms Chow was again somewhat misleading and not strictly accurate. The assertion that Dr Chau "was implicated as the source of a $200,000 bribe to the President of the General Assembly, John Ashe" was, at best, an overstatement. 269 Second, it was particularly unreasonable for Mr Garnaut to expect Ms Chow to provide any meaningful response to his assertion or belief that Dr Chau was CC-3. That assertion was likely to be entirely meaningless to Ms Chow unless she had read and understood the Complaint. Mr Garnaut had no reason to believe that Ms Chow would necessarily have read, let alone understood, the Complaint. Ms Chow's evidence was that she had not read it. Mr Garnaut did not ask Ms Chow whether she had. 270 Third, Mr Garnaut had called Ms Chow "out of the blue", without warning, while she was on holidays and travelling by car in China. He put serious allegations about her father to her, in circumstances where he had no reasonable grounds to believe that she knew anything about them, or could reasonably be expected to provide an immediate and considered response. It could have been hardly surprising, in those circumstances, that Ms Chow appeared flustered. Her statement that the whole thing was a "misunderstanding" should have been considered in that context. Instead, Mr Garnaut leapt upon that as a basis for a serious adverse inference against not only Ms Chow, but also Dr Chau. 271 Fourth, Mr Garnaut had no reasonable basis to infer or conclude that Ms Chow had hung up on him. Telephone connections, particularly international mobile connections, can cut out for all manner of reasons. The inference that Mr Garnaut drew was not the only reasonable inference in the circumstances. 272 The fact that Mr Garnaut drew an adverse inference against Dr Chau as a result of his contact with Ms Chow would be largely irrelevant but for the fact that it plainly came to be reflected in the general tone and tenor of the article. Perhaps more significantly, in this context, the adverse inference appears to have manifested itself in the way that the article portrayed Ms Chow's response to the allegations. As has already been indicated, Ms Chow's responses were portrayed as faintly ridiculous or absurd. As will be seen, that is a relevant consideration in determining whether Fairfax and Mr Garnaut made a reasonable attempt to publish Dr Chau's response to the story. 273 One final point should be made concerning Mr Garnaut's contact with Ms Chow. One thing that Ms Chow did say to Mr Garnaut was that a statement would be issued in relation to the matters that had been raised by him. That was not an unreasonable response in all the circumstances, despite the inference drawn by Mr Garnaut to the contrary. As will be seen, Dr Chau also indicated that a statement would be issued when he was contacted by Mr Wen. No statement was issued prior to the article being published online. It is, however, at least questionable whether Fairfax and Mr Garnaut allowed sufficient time for the provision of the statement before publication. That issue is considered further below.

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The conversation between Mr Wen and Dr Chau 274 Mr Wen was the China correspondent for Fairfax at the relevant time. He spoke fluent Mandarin. His evidence was that he had spoken with Dr Chau, in a professional capacity, on about six occasions before October 2015. 275 At some time during the morning of 16 October 2015, Mr Wen telephoned Dr Chau. His purpose in calling Dr Chau was supposedly to "give him the opportunity to comment, as well as to find out more information for the story". Dr Chau did not answer Mr Wen's initial call, but called Mr Wen back about 15 or 20 minutes later. Mr Wen recorded the ensuing telephone conversation he had with Dr Chau in Mandarin. The conversation was quite short. A translated transcript of the conversation was tendered. It is convenient to set out the translated conversation in full. In the following extract, "PW" is Mr Wen and "CCW" is Dr Chau. PW: Are you in Guangzhou? CCW: Yes in Guangzhou, why's that? PW: How've you been lately? CCW: Good PW: This UN thing, is the information accurate? CCW: When the time comes, we will have someone get in touch with you, okay? PW: Someone will get in touch with us? CCW: Yes, get in touch. PW: Well we've got a pretty reasonable relationship so I thought I'd personally give you a call. I know others have made contact with your company but I wanted to understand the situation from you directly. CCW: When the times comes I'll get the concerned party who arranged this activity to explain the situation to you, then you'll be clear, okay? Don't pass the rumours, okay? PW: Get the Concerned party? CCW: The concerned party because they know the details. I don't know the details, you understand? This event wasn't organised by me, so I'm not clear. In terms of being in contact with other people, I didn't do so, I'm also not clear. PW: But didn't you personally invite, for example, UN's John Ashe? CCW: No, no I had made no contact from the beginning, you know I had made no contact and I don't know the situation. As to the details, you already said, we know each other well; with regard to this matter, I will let the person who organised the event and meeting, get in touch with you in due course and let you know the situation at that time. PW: But you were together during the activities, you had photos together. CCW: I'm not familiar with him, we didn't have contact. And it wasn't me who made the invitation. PW: So can I ask who made the invitation then? CCW: Who made the invitation? Well when the time comes we'll organise the person from the summit who was responsible to this matter to get in touch with you because I don't know the details so I can't outline for you the process. Someone will get in touch with you soon. PW: But isn't New York 'directly looking for you … CCW: No. PW: No? No contact with you asking you to provide evidence? CCW: No. No. PW: Will you be in Australia soon? CCW: I'll come and go as normal. PW: It won't directly implicate you? No worries … CCW: No. I have no contact with him and not familiar with him. This summit wasn't organised by me either it was a few groups of people doing it. I had no involvement in these matters. PW: But you're the boss, right? CCW: I'm the boss so you know I can't care about that much. As you know, there were all different groups participating in that summit. It was Qian Qiu, Zhang Xiaoqi those people who led this matter. It was mainly led by them, and the Friendship Association, the State Friendship Association also participated in this matter, there were a few groups involved in this matter and I didn't have involvement in the direct works. PW: But, would you know about payment of fees? CCW: I don't know. PW: But paying fees is alright, isn't it? If you wanted to invite people to come over paying participation fees would be natural. CCW: How about this, I'll get the concerned party who organized this activity and knew this matter to contact you direct and at that time he/she will tell you all about this matter and you will be clear. PW: Is the person a non-Chinese? CCW: Will let you know when the time comes. He/she has your number. You'll hear the details and go, 'oh, so that's what happened'. PW: Well they'd have to hurry because this matter had been reported by the international media, as you know. CCW: Well you need to seek truth from the facts. At the end it will all be clear. PW: When were you last in Australia? CCW: I don't remember. Ok let's talk next time …over this short period of time before we make contact with you, you should ask them not to make any report, it will be no good if an unreal report is made. PW: Ok, thanks Mr Chau. 276 Following the conversation, Mr Wen sent an email to Mr Garnaut reporting on his conversation with Dr Chau. The report was as follows: I gave him a call this morning and it rang out, he called back about 20 minutes later. He confirmed he was in Guangzhou. He was full of bluster and basically denied direct knowledge of anything. "I don't know the details, do you understand?" "I wasn't organising this event, so I'm not clear." "I don't know him [Ashe] well, I didn't come into contact with him, and it wasn't me who invited him." But I said he was the host and chair(?) of the event and that he was pictured right next to him. He basically tried to say that he didn't fuss around with the details of organising the event. Said he had no knowledge of payments "You know there were several groups participating in this event. Global SMEs were organising this, it was mainly them. The Association of Friendship(?) too… I don't participate in these direct things" He said he had no contact or requests for evidence from investigators in the US. Denied he was worried about being implicated, or that it would affect his travel to the [sic] Australia. "I will come and go as normal" 277 Dr Chau's evidence was that he was in a car in China when he had the telephone conversation with Mr Wen. At this point in time he was aware that Ms Yan had been arrested and that it was alleged that she had bribed the President of the United Nations General Assembly. He initially claimed that, at the time of the conversation with Mr Wen, he did not know that one of the bribery allegations against Ms Yan related to Mr Ashe's attendance at the conference which was held at Kingold's resort. Ultimately, however, he conceded that he understood Mr Wen's reference to "[t]his UN thing" as being a reference to the conference. Despite that, he maintained that he did not connect the conversation that he was having with Mr Wen to the knowledge that he had about Ms Yan and the charges that had been laid against her. He also said that it was not clear to him, and he did not understand, what Mr Wen was referring to when he said "[b]ut isn't New York directly looking for you". 278 The following points may be made concerning the conversation between Mr Wen and Dr Chau and Mr Wen's reporting of it to Mr Garnaut. 279 First, at no time did Mr Wen put what was said to be the key allegation to Dr Chau in clear and unequivocal terms. The key allegation was that Dr Chau had bribed Mr Ashe so as to secure his attendance at a conference held at his resort. Mr Wen's reference to the "UN thing" was, at best, vague and ambiguous. 280 It may be inferred from the terms of the conversation and Dr Chau's responses to Mr Wen's questions that, despite that vague introduction to the topic, Dr Chau understood and appreciated that he was being asked about the bribery charges against Ms Yan insofar as they related to Mr Ashe and his attendance at the conference held at Dr Chau's, or Kingold's, resort. Dr Chau's evidence to the contrary was rather implausible and difficult to accept. In any event, it does not follow that Dr Chau necessarily understood and appreciated exactly what was being put, or was going to be put, against him. Nor was Dr Chau likely to have understood or appreciated that from what Mr Wen said. Mr Wen did not refer to the Complaint, or to the fact that Fairfax believed or alleged that Dr Chau was the individual identified as "CC-3" in the Complaint, or that Fairfax believed or alleged that Dr Chau had bribed Mr Ashe, or that it was alleged that he was the source of the bribe that was paid to Mr Ashe. 281 Second, Mr Wen also did not put to Dr Chau, in clear or explicit terms, a number of the other material assertions or allegations that ultimately appeared in the article. While Dr Chau was asked whether "New York" was "directly looking for [him]", the follow-up question would plainly have suggested to Dr Chau that Mr Wen was querying whether "New York" might have been asking him to provide evidence. It was not put to him in clear terms that the United States Department of Justice was investigating him, or might be considering charging him. Perhaps more significantly, while Dr Chau was asked, in the context of whether he had been asked to provide evidence, whether he would be in Australia soon, it was not put to him that he might choose to remain in China to avoid extradition to the United States. Nor was the allegation or assertion that the Kingold web pages relating to the conference had been "scrubbed" put to Dr Chau. 282 Third, Dr Chau was not asked for his response to what turned out to be the main theme, or at least one of the main themes, of the article; that the bribery allegations might suggest that the political and other donations which Dr Chau had made in Australia were somehow "illicit"; or more broadly, that the bribery allegations might suggest that the "extraordinary Kingold kingdom of Australia and China relations was built upon illicit payments and hot air". There was not even a hint of this broader allegation during the telephone conversation. 283 Fourth, Mr Wen's email summary of the conversation was far from a fair or reasonable summary. The basis of Mr Wen's assertion that Dr Chau was "full of bluster" is unclear. It was also unfair and unreasonable to characterise Dr Chau's response as denying "direct knowledge of anything". That tended to portray Dr Chau's response as being ridiculous. Read fairly and as a whole, it is tolerably clear that what Dr Chau was saying was that he personally did not organise the conference, that he personally did not invite Mr Ashe, and that he did not know about the payment of any fee to Mr Ashe. It was in that context that Dr Chau indicated that he would arrange for the person who did organise the conference and Mr Ashe's attendance to contact Mr Wen to explain the situation to him. There was nothing ridiculous about Dr Chau's assertions that he personally did not organise the conference and knew nothing about the matters of detail to which he referred. 284 It is difficult to understand why Mr Wen was apparently so sceptical about Dr Chau's assertion that he was not directly involved in, and did not know the details of those matters. It was inaccurate and unfair of Mr Wen to characterise Dr Chau's position as being that he "didn't fuss around with the details of organising the event". Had Mr Wen read the material downloaded from the Kingold website, he would have seen that the conference organisers were in fact the Chinese People's Association for Friendship with Foreign Countries, the United Nations Industrial Development Organisation and the Global Alliance of SMEs. The Kingold Group was a co-organiser, however given Dr Chau's position, it is hardly implausible that he would not have been involved in the fine details of the organisation of the conference. It will also be recalled that the Complaint did not allege otherwise, even if it be accepted that Dr Chau was CC-3. The Complaint did not include a single direct allegation against CC-3. 285 Another difficulty with the summary prepared by Mr Wen is that the quotes extracted by him, for the most part, were disaggregated and taken out of their proper context. For example, Dr Chau may well have said "I don't know the details, you understand?". Read in isolation, that assertion appears to be somewhat meaningless. When those words are read in context, however, it is clear that Dr Chau was saying that he was not directly or personally involved in the organisation of the conference, so he did not know the details relating to the invitation to Mr Ashe to speak at the event and any payment that may have been made to him. That assertion is not meaningless. 286 Similarly, while Dr Chau may have said something along the lines of "I don't know him [Ashe] well, I didn't come into contact with him, and it wasn't me who invited him", that statement was made in the context of Mr Wen's suggestion that Dr Chau and Mr Ashe "were together during the activities" and "had photos together". It should also perhaps be noted in this context that the basis of Mr Wen's assertion that Dr Chau and Mr Ashe "were together during the activities" is, at best, unclear. Mr Wen's assertion that Dr Chau and Mr Ashe "had photos together" is also rather misleading. The downloaded conference materials include a large group photograph. The existence of that photograph is hardly inconsistent with Dr Chau's statement that he did not know Mr Ashe well, did not come into contact with him and did not invite him. 287 Fairfax and Mr Garnaut submitted that Dr Chau's responses to Mr Wen's questions were "lucid and forceful". That may well be the case. That was not, however, how Dr Chau's responses were portrayed by Mr Wen in his summary. Perhaps more significantly, that is not how they were portrayed in the article.

[40]

The portrayal of Dr Chau's responses in the article 288 The portrayal of Dr Chau's response to the allegations in the article was discussed earlier in the context of the issue as to whether the alleged imputations were conveyed by the articles. In short, Dr Chau's response to the allegations was not fairly portrayed. The following points should be made or reiterated in that regard. 289 First, the assertion that "Chau denies any direct knowledge of anything" (at [6] of the article) was quite misleading. Dr Chau said no such thing. What he did deny was that he was personally or directly involved in the organisation of the conference, that he personally invited Mr Ashe, and that he was aware of the fee paid to Mr Ashe. The portrayal of Dr Chau's denial, misleading as it was, was also subverted by the statement that immediately preceded it: that "the United States may be considering taking action" against Dr Chau. To make matters worse, for the reasons already given, Mr Garnaut had no reasonable basis for making that statement. 290 Second, Dr Chau's statement that "I don't know the details, you understand?" was taken completely out of context, with the result that it appeared rather meaningless, if not, absurd. Read in isolation, it is entirely unclear what "details" Dr Chau was saying he did not know? Considered in its proper context, however, it is clear that what Dr Chau was saying was that he was not personally involved in the organisation of the conference, and therefore did not know the details concerning the invitation to Mr Ashe and any payment that may have been made to him. Indeed, the article did not even refer to the fact that Mr Ashe's appearance at "Chau's resort" was in the context of a conference. It certainly did not point out that the conference was organised by a group of apparently reputable non-government organisations, that Kingold was only a co-organiser, and that a number of other notable persons spoke at the conference and were paid speaker's fees. One of the other speakers was the former President of the United States of America, Mr Bill Clinton. 291 Third, it was not entirely correct to say that Dr Chau had "denied he had anything to fear from the unfolding scandal" (at [9]). Dr Chau was asked whether he would be in Australia soon and he simply responded that he would "come and go as normal". It was Mr Wen who raised the question, "[i]t won't directly implicate you?". Dr Chau's response was to reiterate, in effect, that he was not involved in organising the conference. 292 Fourth, Ms Chow's statement that "[t]he whole thing is a misunderstanding" (at [14]) was again taken completely out of context and was, in any event, unfair given that Mr Garnaut had no reasonable basis to believe that Ms Chow had any knowledge of the allegations, or was able to meaningfully respond to them on Dr Chau's behalf. 293 Fifth, Dr Chau's statement that "I don't know him [Ashe] well, I didn't come into contact with him, and it wasn't me who invited him" (at [17]) was subverted by the immediately preceding assertion that "Chau was at the event, and was pictured with Ashe". What was not made clear was that a large number of people attended the event and the supposed picture of Dr Chau with Mr Ashe was in fact a large formal group picture. 294 Sixth, the statement that "Chau has insisted it would not affect his travel to Australia" (at [48]), read in the context in which it appeared in the article, was misleading. That statement was immediately preceded by the assertion that "it might appear prudent for the billionaire to bunker down in China, away from the reach of extradition treaties". That tended to suggest that Dr Chau had said that the risk of extradition would not affect his travel to Australia. Dr Chau said no such thing. The prospect of extradition, and the suggestion that he might remain in China to avoid it, was never clearly put to Dr Chau for his response. Dr Chau's statement that he would "come and go as normal" was also portrayed as being a response to the suggestion that he might fear extradition. In fact, Dr Chau made that statement in response to the considerably more benign question "[w]ill you be in Australia soon?" 295 Seventh, a fair reading of Dr Chau's responses to Mr Wen's questions indicates that Dr Chau's "side of the story" was, in substance, that: he did not personally organise the conference; there were a number of different groups who participated in and organised the conference; he did not personally invite Mr Ashe to speak at the conference; he did not know about the payment of any fee to Mr Ashe; and that, as far as he was concerned, he was not implicated in any way and had not been asked to provide evidence. The article does not clearly or coherently reveal Dr Chau's side of the story.

[42]

Mr Garnaut's belief and intentions in relation to the imputations 299 Mr Garnaut made it plain in his evidence that he thought that the first imputation, that Dr Chau had bribed Mr Ashe, was "probably true". He claimed, however, that he did not intend to convey that imputation. Rather, he intended to raise a "strong suspicion" that that was the case. He also maintained that he had taken "great care to write it [the article] carefully so that it was expressed as a possibility not an absolute fact". 300 Mr Garnaut's evidence in relation to the second imputation, that Dr Chau had participated in a conspiracy to bribe Mr Ashe, was essentially the same as his evidence in relation to the first imputation. He said that he believed that the imputation was "probably true" but that it was not for him "to play prosecutor, judge and jury". He intended to convey that there was a "strong suspicion" that Dr Chau had participated in such a conspiracy. He did not, however, intend to convey that Dr Chau had in fact participated in the conspiracy and "wrote it precisely … to avoid conveying a definitive imputation like that". 301 As for the third imputation, being that Dr Chau had acted in so serious a manner as to deserve extradition to the United States on criminal charges, including charges of bribery, Mr Garnaut's evidence was that he "thought [that] there was a possibility, maybe even a strong suspicion that he [Dr Chau] would be indicted and extradited if he left China". He did not, however, intend to convey that imputation and claimed that he was "cautious in the way that [he] raised a strong suspicion rather than a definitive point" and that he "took care to avoid conveying that". As for how he took care to avoid conveying the imputation, Mr Garnaut's evidence was that: …. at all times, I was talking in terms of possibility, perhaps, may, of providing his own counterviews, so these were - you know, at no point did I say he would be extradited, he would be charged, or that he deserved to. 302 If Mr Garnaut did intend to exercise caution so as to avoid conveying anything beyond the strong suspicion that Dr Chau was implicated in the bribing of Mr Ashe, he manifestly failed in that endeavour. For the reasons given in detail earlier, each of the first three imputations was in fact conveyed by the article. More significantly, in the present context, there are a number of features of the articles which reveal that insufficient steps were taken to ensure that the imputations were not conveyed. Those features were highlighted earlier in the context of the question whether the imputations were conveyed. In summary, and at risk of repetition, they include the following. 303 First, the language in the article was sensationalist and hyperbolic and generally derisive and deprecating when it came to Dr Chau. Had Mr Garnaut genuinely intended to exercise caution, he would not have opened the article with the suggestion that Dr Chau might prefer to "bunker down" in his "personal "imperial palace"" to avoid extradition in connection with an "unfolding international bribery scandal". Nor would he have referred to "offending" web pages being "scrubbed from cyberspace"; or referred to Dr Chau as "the king" and "No. 1 client" of the "social queen of Australia-China relations"; or concluded the article with the suggestion that "the extraordinary Kingold kingdom of Australia and China relations" may have been "built upon illicit payments and hot air". 304 Second, the references to Dr Chau's supposed fear or extradition and the "scrubbing" of "offending web pages" were not only unnecessarily sensationalist, they plainly implied consciousness of guilt on the part of Dr Chau. Why would he want to "bunker down" in China to avoid extradition, or "scrub" websites which supposedly showed his contact with Mr Ashe at the relevant conference, if he was innocent? 305 Third, for the reasons already given, there was no reasonable basis for the inclusion of either the extradition assertion or the "scrubbing" of websites assertion. 306 Fourth, as already explained in considerable detail, Dr Chau's responses to the allegations were disaggregated and taken out of context, were in some respects portrayed in a misleading light, were generally subverted by their strategic placement in the article and were dealt with in a generally disparaging way. So too were the statements made by Ms Chow. 307 Fifth, the article does not sufficiently emphasise that the charges against Mr Ashe, Ms Yan, and implicitly CC-3 or Dr Chau, were merely accusations. Most of the facts, including those that were not part of the Complaint, were portrayed as unequivocal facts. To give one example, the article asserts that Ms Yan wrote the invitation letter to Mr Ashe on Dr Chau's behalf. That was not a fair or accurate summary of the actual allegation in the Complaint. Even if it was, it was not said to be a mere allegation. By way of contrast, the Department of Justice media release emphasised not only that the charges and text of the Complaint were merely allegations or accusations, but also that the defendants were presumed innocent unless and until proven guilty. No such cautionary note was included in the article. Indeed, the references to the Complaint constituting only accusations or allegations are scant indeed. 308 Sixth, the extended discussion of Dr Chau's donations and political connections in Australia, and the claim that they were part of the "virtuous circle of guanxi", created further "smoke" and the clear impression of the existence of the underlying "fire", to borrow the analogy used by Lord Devlin in Lewis v Daily Telegraph. That is particularly so given that it was unequivocally asserted in the article that the pattern of payments and resulting access and power was said to have "extended right up to the president of the UN General Assembly, John Ashe". That effectively amounted to an unequivocal assertion that Dr Chau had purchased his access to Mr Ashe. 309 Seventh, the article did not include many material facts which would have put the bribery allegations and the suggestion that Dr Chau was implicated in their proper context. For example, while the article asserted that the payment of $200,000 "bought Ashe's appearance, in his official capacity, at Chau's resort", it neglected to mention that the "appearance" of Mr Ashe was as a speaker at a conference organised by a group of apparently reputable non-government organisations, and that a number of other notable persons were paid for speaking at the conference. The article chose to focus on a series of sensational titbits - the purchase of the Packer mansion, Dr Chau's personal "imperial palace" - instead of providing a measured analysis of the particulars of the bribery allegations. 310 In all the circumstances, Mr Garnaut's apparent claim that he took reasonable steps to ensure that anything beyond suspicion was conveyed was and is wholly without substance and is rejected.

[50]

Sources of information - s 30(3)(g) 318 It may be accepted that the Complaint was a reliable source of information, as was the Department of Justice media release. For the reasons given in detail earlier, however, it does not appear that Fairfax and Mr Garnaut gave sufficient consideration or attention to the relevant parts of the Complaint. Either that, or they did not really understand it. In particular, it appears to have completely escaped their attention that the Complaint did not include any direct allegation against the person referred to as CC-3. It was not directly alleged that CC-3 did anything, said anything, or knew anything in relation to the bribe. The references to CC-3 were essentially limited to hearsay assertions in letters prepared by others and the allegation that the relevant $200,000 was paid from one of CC-3's companies. It was not alleged that CC-3 knew about, let alone authorised, that payment. 319 It should also be emphasised the Complaint was a reliable source for allegations, not facts. That was emphasised by the Department of Justice media release. This was not adequately emphasised in the article. 320 As for Mr Garnaut's other sources, for the reasons given in detail earlier, I am not persuaded that Mr Garnaut was being entirely honest concerning his reliance on confidential source 1, or that his evidence in that regard was credible or reliable. Perhaps more significantly, even if Mr Garnaut did rely on information provided by confidential source 1 as he claimed, there was no reasonable basis for Mr Garnaut to believe that that source's view that Dr Chau might choose to remain in China to avoid extradition amounted to anything more than speculation. 321 As for Mr Uren, as Mr Garnaut himself accepted, Mr Uren was scarcely an entirely objective source. Based on Mr Garnaut's fairly limited account of his conversation with Mr Uren, it is also difficult to see how Mr Garnaut had any reasonable basis to believe that Mr Uren had any first-hand knowledge of Dr Chau's supposed involvement in or knowledge of the payment to Mr Ashe.

[53]

Was the conduct in publishing reasonable? 324 The determination of whether a respondent's conduct in publishing a defamatory matter was reasonable in the circumstances is a broad evaluative exercise which involves the careful consideration of all the circumstances leading up to and surrounding the publication. Having considered and weighed up all those circumstances, I am not positively persuaded that the conduct of Fairfax and Mr Garnaut in publishing the matter complained of, which has been found to have conveyed three serious defamatory imputations against Dr Chau, was reasonable in the circumstances. Indeed, I consider their conduct to have been unreasonable in many respects. 325 The facts and circumstances which have led me to this conclusion have already been discussed in detail. The critical considerations are, in summary: the apparent failure of Mr Garnaut to carefully consider and analyse the Complaint and appreciate not only that CC-3 had not been charged or even identified in the Complaint, but that no direct allegation of any act, omission or knowledge on the part of CC-3 was made in the Complaint; the unwarranted and damaging inclusion of the assertion that Dr Chau might remain in China to avoid extradition, in circumstances where the main reason for including that assertion appeared to be to provide a sensational local "angle" relating to Dr Chau's purchase of a "Vaucluse mansion"; the absence of any, or any reliable, source for the extradition assertion; the inclusion of the inaccurate, unjustified and damaging assertion that "offending" web pages which had supposedly revealed contact between Dr Chau and Mr Ashe at the "event" at Dr Chau's resort had been "scrubbed from cyberspace"; the inadequate and unfair presentation of Dr Chau's side of the story; the sensational and hyperbolic language and the general sneering and deprecating tone of the article as a whole; and the lack of any demonstrable care and caution in reporting serious allegations against Dr Chau, including the failure to take adequate steps to ensure that defamatory imputations were not conveyed.

[55]

Relevant principles - Malice 328 Malice, in the context of defamation and qualified privilege, means "any improper motive or purpose that induces the defendant to use the occasion of qualified privilege to defame the plaintiff": Roberts v Bass at [75] per Gaudron, McHugh and Gummow JJ. It is necessary to prove both that the publisher's motive or purpose was foreign to the occasion of privilege and that it actuated the making of the defamatory statement. In Roberts v Bass, Gaudron, McHugh and Gummow JJ explained what was required to prove malice in the following terms (at [76]): Improper motive in making the defamatory publication must not be confused with the defendant's ill-will, knowledge of falsity, recklessness, lack of belief in the defamatory statement, bias, prejudice or any other motive than duty or interest for making the publication. If one of these matters is proved, it usually provides a premise for inferring that the defendant was actuated by an improper motive in making the publication. Indeed, proof that the defendant knew that a defamatory statement made on an occasion of qualified privilege was untrue is ordinarily conclusive evidence that the publication was actuated by an improper motive. But, leaving aside the special case of knowledge of falsity, mere proof of the defendant's ill-will, prejudice, bias, recklessness, lack of belief in truth or improper motive is not sufficient to establish malice. The evidence or the publication must also show some ground for concluding that the ill-will, lack of belief in the truth of the publication, recklessness, bias, prejudice or other motive existed on the privileged occasion and actuated the publication. Even knowledge or a belief that the defamatory statement was false will not destroy the privilege, if the defendant was under a legal duty to make the communication. In such cases, the truth of the defamation is not a matter that concerns the defendant, and provides no ground for inferring that the publication was actuated by an improper motive. Thus, a police officer who is bound to report statements concerning other officers to a superior will not lose the protection of the privilege even though he or she knows or believes that the statement is false and defamatory unless the officer falsified the information. Conversely, even if the defendant believes that the defamatory statement is true, malice will be established by proof that the publication was actuated by a motive foreign to the privileged occasion. That is because qualified privilege is, and can only be, destroyed by the existence of an improper motive that actuates the publication. (Footnotes omitted.) 329 An allegation of malice is essentially an allegation of dishonesty and thus must be properly particularised: Hughes v Risbridger [2009] EWHC 3244 (QB) at [15]. It must be established by cogent evidence commensurate with the seriousness of the charge: Rackham v Sandy [2005] EWHC 482 (QB) at [17].

[56]

Was the article actuated by malice? 330 The evidence does not demonstrate malice on the part of Mr Garnaut or Fairfax. It does not support an inference that Mr Garnaut or Fairfax published the defamatory imputations for the purpose of hurting, harming or damaging Dr Chau's reputation, or that they otherwise had any improper motive. 331 Dr Chau's case that Mr Garnaut and Fairfax had an improper motive was primarily based on statements made by Mr Garnaut in internal email correspondence with his colleagues in the course of investigating and drafting the article. Some of those statements have already been referred to. They include: in an email to Mr Bachelard and others at Fairfax which appears to have primarily related to the initial article concerning Ms Yan, Mr Garnaut wrote, in the subject line, "[d]oesn't get much more fun than this"; in an email to Mr Wen in which he stated that CC-3 was probably Dr Chau, Mr Garnaut's subject line was "[f]un, and huge"; in an email to various Fairfax colleagues after he had discovered that he had been scooped by a rival journalist, Mr Garnaut wrote that they [Fairfax] had been "too clever by half, saving the big hit on Dr Chau for day 2"; in an email to the journalist who scooped him, Mr Garnaut wrote, in relation to the proposed story concerning Dr Chau, "[t]his must be just about the most rewarding story the Motherland has ever given us" and "I LOVE IT"; in an email to Mr Flitton and Mr Wen after he had supposedly found a "whole graveyard of excavated websites" relating to the convention held at Dr Chau's resort, Mr Garnaut wrote "[j]ust quietly, this is huge"; in an email to Mr Flitton and Mr Wen after he had spoken to Ms Chow, Mr Garnaut wrote "[h]e's fucked"; and in an email to Mr Wen and Mr Bachelard after he had received Mr Wen's report of his conversation with Dr Chau, Mr Garnaut wrote "[l]ove it". 332 Those statements in Mr Garnaut's internal emails to his colleagues should perhaps be considered in the context of the evidence relating to Mr Garnaut's earlier interactions with Dr Chau and the impressions that Mr Garnaut said that he had formed about Dr Chau and his supposed his methods of operation. As discussed earlier, it would appear that, for reasons that remain somewhat puzzling, Mr Garnaut formed an adverse impression of, and attitude towards, Dr Chau as a result of his earlier interactions. Indeed, it would be fair to say that Mr Garnaut formed what appeared to have been an almost unhealthy obsession with Dr Chau's wealth and apparent power and influence in China and the access and influence that he appeared to have acquired in Australia as a result of his political and philanthropic donations. It was perhaps not surprising, in those circumstances, that Mr Garnaut so readily came to believe that Dr Chau had in fact been involved in bribing Mr Ashe, even though he had not been charged or even identified in the Complaint. 333 Even considered in that context, however, the statements that Mr Garnaut made in his internal emails do not support an inference that Mr Garnaut's purpose in writing the article was to damage Dr Chau. While some of the statements made by Mr Garnaut in his internal communications perhaps do not reflect well on him and his professionalism, considered in the context of the evidence as a whole, the preferable and more reasonable inference is that Mr Garnaut was simply excited, perhaps over-excited, by the prospect of writing what he considered to be a major story about someone who he plainly believed was a major figure in relations between Australia and China. It is clear that Mr Garnaut enjoyed his work, and that the story about Dr Chau was right up his alley, particularly given his fascination with Dr Chau. Regrettably for Mr Garnaut and Fairfax, however, Mr Garnaut's over-enthusiasm, coupled perhaps with his antipathy towards Dr Chau, appears to have caused him to rush out what turned out to be an overly sensationalist and poorly researched and constructed article which, despite Mr Garnaut's apparent intentions, imputed not just suspicion, but guilt insofar as Dr Chau was concerned. It does not, however, follow that Mr Garnaut was improperly motivated. 334 It should perhaps also be noted, in this context, that Mr Garnaut denied that his intention was to damage Dr Chau and his reputation. He acknowledged that it was clear to him that the article would damage Dr Chau's reputation. He explained his attitude towards the likely damage to Dr Chau's reputation in the following terms: I see?---I was - I - I - I've never taken any glee in hurting somebody's reputation. In this case, I very carefully took my story up to the limits of the information, and then stepped - took a couple of big steps backwards, sir. There's much more that I could have write - written at the time, which I did not. I get no joy out of damaging somebody else's reputation. It is my duty to tell important facts as I see them, for the public to absorb as they do. And, in this case, I can't actually think of a more significant story, a more significant body of information to be conveying to the Australian readers. Thank you. 335 Mr Garnaut's evidence that his purpose in writing the article was not to hurt or damage Dr Chau should be accepted. His evidence that he "took a couple of big steps backwards" is more doubtful. If he did so, for the reasons already given in detail, they were certainly not big enough.

[58]

Compensatory damages 337 Section 34 of the Defamation Act provides that "[i]n determining the amount of damages to be awarded in any defamation proceedings, the court is to ensure that there is an appropriate and rational relationship between the harm sustained by the plaintiff and the amount of damages awarded". 338 Past authorities shed some light on what might be considered to be the "appropriate and rational relationship" for the purposes of s 34. 339 In Carson v John Fairfax & Sons Ltd (1993) 178 CLR 44 at 60, a majority of the High Court noted that there are three purposes to be served by damages awarded for defamation: consolation for the personal distress and hurt caused to the plaintiff by the publication, reparation for the harm done to the plaintiff's personal and (if relevant) business reputation, and vindication of the plaintiff's reputation. The first two purposes are frequently considered together, whereas "[v]indication looks to the attitude of others to the [plaintiff]: the sum awarded must be at least the minimum necessary to signal to the public the vindication of the [plaintiff's] reputation": Carson at 61. 340 The level of damages should reflect the fact that the law "should place a high value upon the reputation and in particular upon the reputation of those whose work and life depend upon their honesty, integrity and judgment": Crampton v Nugawela (1996) 41 NSWLR 176 at 195; referred to with approval in John Fairfax Publications Pty Ltd v O'Shane (No 2) [2005] NSWCA 291 at [3]. 341 Section 35 of the Defamation Act in effect specifies a cap for non-economic loss. The prescribed cap for the purposes of s 35 of the Defamation Act is currently $398,500: Gazette No 66, 29 June 2018 p 3970. Section 35(2) provides that the cap may be exceeded "if, and only if, the court is satisfied that the circumstances of the publication of the defamatory matter to which the proceedings relate are such as to warrant an award of aggravated damages". 342 Section 36 of the Defamation Act provides that in awarding damages for defamation, the court is to "disregard the malice or other state of mind of the defendant at the time of the publication of the defamatory matter to which the proceedings relate or at any other time except to the extent that the malice or other state of mind affects the harm sustained by the plaintiff". 343 Section 38 of the Defamation Act provides that evidence of certain matters is admissible in mitigation of damages for the publication of defamatory matter. That evidence includes, relevantly, evidence that the plaintiff has received or agreed to receive compensation for defamation in relation to any other publication of matter having the same meaning or effect as the defamatory matter: s 38(1)(e). Section 38(1)(e) is to be applied in a broad way with the object of preventing a plaintiff from receiving double compensation for the same loss, while ensuring that the plaintiff obtains proper compensation from a defendant for the particular defamatory publication sued upon: Thompson v Australian Capital Television Pty Ltd (1997) 129 ACTR 14 at 20; Uren v John Fairfax & Sons Ltd (1965) 66 SR (NSW) 223; O'Shane v Fairfax Publications Pty Ltd [2002] NSWSC 807 at [9]-[16]; Kevin Waters v John Fairfax Publications Pty Ltd [2005] NSWSC 394 at [33]. 344 In relation to s 38 of the Defamation Act, Fairfax and Mr Garnaut relied on evidence that established that Dr Chau had commenced defamation proceedings against a rival media organisation concerning publications, which appeared in the Daily Telegraph and an associated website. The alleged defamatory imputations in that action included that Dr Chau had bribed Mr Ashe and had engaged in such serious wrongdoing as to cause his activities to be investigated by the United States Attorney in New York. Those proceedings were settled at an early stage. Dr Chau received compensation of $65,000, inclusive of costs, as part of the settlement. Fairfax and Mr Garnaut submitted that it could be inferred that at least half of that settlement figure related to the publication in the Daily Telegraph and an associated website.

[60]

Harm to reputation and vindication 348 There was evidence concerning Dr Chau's good reputation prior to publication. There was no evidence to suggest that Dr Chau had a bad reputation in any respect. 349 Dr Chau himself gave evidence about his considerable philanthropic and other contributions to Australia. Those contributions included: successfully promoting, without remuneration or personal benefit, a huge agreement which resulted in the supply of Australian sourced natural gas to Guangdong; the donation of $20 million to the University of Technology, Sydney, to build a building to house that university's business school; the donation of $5 million to the University of Technology to support a scholarship; the donation of $15 million to the University of Sydney to assist in the construction of a museum; donations to the Australian War Memorial; and various other sponsorships and charitable donations. There was evidence that Dr Chau holds an honorary doctorate from the University of Technology and is honorary chairman of the Friends of the United Nations. 350 Mr Ross Milbourne was the Vice-Chancellor and President of the University of Technology Sydney when Dr Chau donated $20 million towards the business school. Mr Milbourne had met Dr Chau a number of times in the years prior to the donation. He said that when the donation was offered, he "did a lot of due diligence around Dr Chau and [he] knew a number of people in the circles [in which he] moved that knew him [Dr Chau] and convinced [him] on all the due diligence that he was a very honourable man". 351 Mr David Ellis was the Director of Museums in Cultural Engagement at the University of Sydney. He dealt with Dr Chau in the context of his $15 million donation to the University of Sydney. His evidence concerning Dr Chau's reputation was as follows: Now, if I could ask you, please, to direct your attention to mid-October 2015. That is before the publication of the article about which this case concerns, which was called "Are Chau Chak Wing's circles of influence in Australia-China ties built on hot air?" At that time, before the article, were you able to make an assessment of the reputation of Dr Chau in the circles in which you mixed, being higher education circles?---Yes, certainly. As soon as when his name was mentioned to me in 2014 I started to - well, to do a bit of investigation. It's always good to know who - who we're dealing with. Dr Chau struck me as one of Australia's most generous philanthropists. He - he was an astute - in my mind he was a very astute businessman, one of the quiet givers in philanthropy in Australia. 352 Dr Tony Goh Chong Maw was the chair of the Australian Council of Chinese Organisations. He had worked with Chinese community organisations in Australia for over 40 years. He had known Dr Chau since 1999. His evidence was that Dr Chau had an "excellent reputation" and was "highly respected", not just in the Chinese community, but also amongst the general community. Dr Maw said that Dr Chau's "generosity as well as his very humble personality", together with the fact that Dr Chau was a "very successful business person", made Dr Chau a "leader of our Chinese community". 353 There was evidence of the rapid spread and far reach of the article, along with the resulting potential of damage to Dr Chau's reputation. 354 Dr Chau himself received communications relating to the article from the Director-General of the Guangdong Provincial Banking Regulatory Bureau, the President of the Chinese Peoples Association for Friendship with Foreign Countries, the Director of Foreign Affairs of the State Council of the People's Republic of China, the President of the Huaxing Bank, in which the Kingold group had a shareholding and Ms Margaret Jack, a prominent member of various company boards. Dr Maw's evidence was that members of the Chinese community who had read the article contacted him and conveyed their indignation. Following the publication of the article, Mr Ellis received a flurry of phone calls from a number of people who, in the context of the University of Sydney's acceptance of the donation from Dr Chau, questioned whether Dr Chau was a reputable person and whether the museum should be named after him. Mr Milbourne was also contacted by various people who had read the article. 355 The award of damages should provide reparation for the harm done to Dr Chau's reputation and be sufficient to signal to the public the vindication of Dr Chau's reputation.

[63]

Aggravated damages 362 Dr Chau contended that he was entitled to aggravated damages on the basis that he knew that the imputations were false and that the article remained on the Herald website in circumstances where there was no defence of justification. He did not press various other particulars of aggravated damages that were included in the pleading. No detailed submissions were made in support of the claim for aggravated damages. 363 Aggravated damages are appropriate where it has been established that in the publication of the matter complained of, or in the defence of the proceeding, the defendant engaged in conduct that was improper, unjustifiable or not bona fide and that conduct increased the subjective hurt suffered by the applicant: Trigell v Pheeney (1951) 82 CLR 497 at 514; Carson at 71; see most recently Bauer Media Pty Ltd v Wilson (No 2) [2018] VSCA 154; 361 ALR 642 at [66]. 364 The evidence does not support an award of aggravated damages on the basis advanced by Dr Chau. The following brief points may be made. 365 First, the evidence does not support a finding that Fairfax or Mr Garnaut knew that the imputations were false. Mr Garnaut's evidence was, in substance, that he did not intend to convey the imputations, but he nevertheless believed that they were "probably true" and had no information to suggest that they were untrue. That aspect of Mr Garnaut's evidence was not directly or significantly challenged. 366 Second, while it was common ground that the article remains online, it could not be said that the imputations were "plainly conveyed" such that the continued publication of the article was unjustifiable, improper and lacking in bona fides. The question whether the imputations were conveyed by the article was by no means easy or straightforward. The arguments advanced by Fairfax and Mr Garnaut in support of the proposition that the imputations were not conveyed, while ultimately not accepted, were nonetheless not entirely unreasonable. 367 Third, there was no evidence, and no sound reason to infer, that the alleged conduct relied on by Dr Chau increased the subjective hurt he suffered.

[64]

Injunctions and other relief 368 In addition to damages, Dr Chau sought orders, in the nature of injunctions, which would have the effect of permanently restraining Fairfax and Mr Garnaut from "publishing any defamatory imputation of and concerning the Applicant as particularised by the Applicant and found by the Court to be carried by the matter complained of" and requiring Fairfax to permanently remove the matter complained of from websites operated or controlled by it. 369 Dr Chau did not advance any substantive submissions in support of the injunctive relief. 370 I am not inclined to make the orders sought. 371 As for the permanent injunction restraining Fairfax and Mr Garnaut from repeating their publication of the defamatory injunctions in the future, such injunctions are generally not made as a matter of course in Australia simply on the basis of a finding that defamatory imputations have been conveyed. It is usually necessary for an applicant to show some additional factor, such as an apprehension that the respondent may, by reason of defiance, disrespect for the Court's judgment or irrationality, republish the same or similar imputations unless restrained: Hockey at [15] and the cases there cited. Dr Chau did not point to any evidence which would suggest any reasonable grounds for apprehending that Fairfax or Mr Garnaut might republish the relevant imputations in the future if found to be defamatory. In all the circumstances, I would consider republication by Fairfax or Mr Garnaut most unlikely. In those circumstances, there is no warrant for the grant of a permanent injunction of the type sought by Dr Chau. 372 As for the order requiring Fairfax to remove the matter complained of from its websites, senior counsel for Fairfax and Mr Garnaut gave an undertaking to the Court that if, contrary to their submissions, the Court found that the defamatory imputations were conveyed by the matter complained of, Fairfax would remove the matter complained of from its websites. Needless to say, there is no basis to conclude that that undertaking would not be complied with. It is accordingly unnecessary to make the order sought by Dr Chau. As already noted, Dr Chau did not contend otherwise.

Chau v Fairfax Media Publications Pty Ltd

At a glance

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Judgment (66 paragraphs)

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Legislation Cited (5)

Cases Cited (30)

Cited By (23)