Supreme Court of NSW|1996-12-23|Before: Handley JA, Mahoney ACJ

Crampton v Nugawela [1996] NSWSC 651 (23 December 1996)

THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

CATCHWORDS: Defamation - Damages - Aggravated and general damages - Economic loss with respect to professional standing - Principles relevant to assessment of damages for defamation - Relationship to damages for serious personal injury

A Supreme Court jury awarded Dr Nugawela $600,000 damages for the publication of the letter. The imputations said to arise out of the letter and which went to the jury included: that Dr Nugawela had falseley represented to the International Medical Informatics Association that the Australian Medical Informatics Association (which Dr Nugawela was instrumental in forming) had the support of the RACGP and the Australian Computer Society (ACS); that Dr Nugawela had caused embarrassment to the RACGP and the ACS; that Dr Nugawela was prepared to make false claims for his own professional gain; and that Dr Nugawela had damaged the advancement of medical informatics in Australia.

Dr Crampton and the RACGP appealed, on the grounds that the trial judge erred in holding the imputations were capable of arising from the matter complained of, that it was not open for the jury to award aggravated damages and that the damages were appealably excessive.

(i) From what the "ordinary reasonable reader" would understand by the letter in question, the imputations were capable of being made by the letter.

Mirror Newspapers Ltd v Harrison [1982] HCA 50; (1982) 149 CLR 293; applied.

Capital & Counties Bank Ltd v Henty & Sons (1882) 7 App Cas 741; Lewis v Daily Telegraph (1964) AC 134; Bik v Mirror Newspapers Ltd (1979) 2 NSWLR 679; Farquar v Bottom (1980) 2 NSWLR 380; Hepburn v TCN Channel 9 Pty Ltd (1984) 1 NSWLR 386; referred to.

(ii) There was no error in the trial judge's rulings on the matters the jury could rely on in awarding aggravated damages. The matters referred to were relevant to the issue of aggravated damages.

Triggell v Pheeney [1951] HCA 23; (1951) 82 CLR 497; referred to.

(iii) It was open for the jury to award damages of $600,000 as representing an undifferentiated sum of compensation for the lost opportunity to earn income and as a solatium for distress, damage to reputation and vindication of the reputation.

Broome v Cassell & Co [1972] UKHL 3; [1972] AC 1027; Carson v John Fairfax & Sons Ltd [1993] HCA 31; (1991) 24 NSWLR 256; (1993) 178 CLR 44; Nationwide News Pty Ltd v Hartley (NSW Court of Appeal, 3 April 1996, unreported); applied.

John v MGN Ltd [1995] EWCA Civ 23; (1996) 2 All ER 35; referred to.

(iv) Observations (by Handley JA) on the proper awarding of damages for loss of reputation in a professional field in defamation cases.

McCarey v Associated Newspapers Ltd (No 2) (1965) 2 QB 86; Proudnam v Yellow Express Carriers Ltd (1970) 1 NSWR 495; referred to.

MAHONEY ACJ: On 17 July 1990 Dr Reginald Michael Crampton published a letter which, Dr Patrick Allan Nugawela claims, accused him of deliberately lying to those concerned with a medical conference. Dr Nugawela sued Dr Crampton and the Royal Australian College of General Practitioners ("the College") for which Dr Crampton had acted. He sued them for defamation.

Dr Nugawela's claim was tried by Levine J and a jury. The trial lasted, as counsel have said, some thirty-seven days. On 22 March 1996 the jury found for Dr Nugawela and awarded him $600,000 damages.

The defendants have appealed to this Court against that judgment. The notice of appeal (as amended) contained twenty-five grounds the statement of which extended over eight pages and more. However in the end, only three grounds have been pressed, namely grounds 1, 10(3) and (6), and 22.

Before dealing with the matters in issue, justice requires that two observations be made: as to the position of the College in the litigation; and as to the findings to be taken to have been made against Dr Crampton.

The judgment is a judgment against both Dr Crampton and the College: each is liable for what has been done to Dr Nugawela and the damages that have been awarded. The liability of Dr Crampton arises from what he himself did: he is responsible because of his own actions. The College is liable, in part at least, because in doing what he did, Dr Crampton acted as the servant or agent of the College and the law holds the College responsible with him for what was done to Dr Nugawela. Whether the College is liable also because of what it itself did to Dr Nugawela or because it adopted and supported what Dr Crampton did has not, in the argument on this appeal, been investigated at length. Accordingly, whether and to what extent the College is liable merely because the law holds it responsible for what Dr Crampton did or because, in addition, it caused damage to Dr Nugawela is not in issue in this appeal. This is a matter, if it is to be judged by what has happened in this litigation, is to be judged by what appears in the record of the trial. The College has not sought to distinguish itself from what Dr Crampton did.

In this judgment I shall refer to what, for the purpose of the issues in this appeal, is assumed to have been done by Dr Crampton. What I shall say, understood according to its terms, may be seen to involve very serious criticism of what he did. What I shall say will assume or infer: that he accused Dr Nugawela of lying in respect of the matter going to Dr Nugawela's professional conduct; that he made the accusation not having any reasonable grounds for believing that it was true and careless or not caring of whether it was true or false; that he persisted in the accusation that he had made over a long period and without any such justification; and that he did these things, not merely for professional or altruistic reasons, but for a purpose which involved his own self-advancement: he wished his association HIMA rather than the association of Dr Nugawela AMIA to be the body which, within the College, dealt with the aspect of practice which was in question.

If that was in fact what he did, his actions were wrong and seriously wrong and reflect seriously upon his character and his standing as a medical practitioner. Therefore it is important that I record that in this litigation there have been no formal findings in terms that Dr Crampton did what I have indicated or as to the seriousness of what he did. This proceeding has, in this regard, been determined by the verdict of a jury. Therefore there is no record in terms of what the jury found Dr Crampton has done: the jury has, as the law provides, given only a general verdict, for Dr Nugawela and against Dr Crampton.

I emphasise these matters because, in an appeal of this kind, the law requires that this Court assume that, in finding for Dr Nugawela and against Dr Crampton, the jury made all the findings necessary to sustain its verdict and that, in doing so, it found the facts to be in favour of Dr Nugawela and against Dr Crampton "at their highest" or, more accurately, as seriously as they could be found against Dr Crampton as far as was necessary to support the verdict in favour of Dr Nugawela which the jury gave. For the purposes of dealing with the issues posed in this appeal, I shall state the facts against Dr Crampton in the conventional way, in a way which assumes them to have been found against him as far as they could reasonably be found against him and as far as it was necessary for them to be found against him in order to justify the jury's verdict.

In doing this, it is not to be assumed that, were I deciding the facts, I would have found them against Dr Crampton to that extent: I may or may not have found them to be such. On the other hand, it is not to be assumed that what I say is a criticism of the jury's finding: counsel have accepted, in my opinion correctly, that (subject to the matters to which I shall refer) the findings which the jury are to be assumed to have made are findings which, on the evidence, they could properly have made against Dr Crampton.

The facts may be stated generally and without elaboration. Both Dr Nugawela and Dr Crampton were concerned in the use or the proposed use of computer technology in medicine. They were each associated with general practice and each had association, of different kinds, with the College. The College itself was interested in the use of computer technology in medicine.

Dr Nugawela became involved in setting up an association for these purposes. It was called the Australian Medical Informatics Association ("AMIA"). It had been set up in Western Australia. Dr Nugawela was trying to set up that body or a similar body in other States so that it became the body adopted by the College.

The College and the Australian Computer Society ("ACS") had given some measure of support to AMIA; the nature and degree of support was in contest in the proceeding. However, Dr Crampton and others had taken the view that they should set up their own body to carry out the purposes in question. They thought that Dr Nugawela should not be allowed to set up the body he proposed in New South Wales. Their intent was that he should not set up AMIA in New South Wales and that he should not succeed in having his body accepted by the College as the significant body in that area of activity.

It was against this background that on 17 July 1990, at a meeting at the Royal North Shore Hospital in Sydney, Dr Crampton presented to those present the letter which is here in question: he provided copies for them. It was a meeting of some twenty-two doctors interested in the relevant topic. Dr Nugawela was not present. The letter made serious criticisms of what Dr Nugawela had done. It proposed that "this NSW Medical Informatics group" should not be associated with AMIA "at least until a properly structured NSW group is operational". Dr Crampton introduced his letter orally but nothing has turned in argument upon what he said: the plaintiff's complaint relates to the letter.

The letter presented to the meeting by Dr Crampton was in the following terms:

"The Royal Australian College of General Practitioners

Australian Medical Infomatics Association, NSW Branch.

Thank you for the invitation to attend and address this meeting.

I wish to raise a number of points on behalf of the RACGP.

1. The RACGP has been active in Medical Computing in Australia throughout the 1980's and is the only group to have held Australian Medical Computing Conferences over that time. As a result of these conferences and other activities, the RACGP believes that it has a reputation as one of the Australian organisations with knowledge of and commitment to the field of Medical Infomatics.

2. As a result of the recent RACGP 6th Computer Conference, a position statement on the RACGP's position in regard to Medical Infomatics has been drafted. This is expected to be ratified by College Council on July 28/29. A copy is appended.

3. The RACGP's NSW Faculty has an active Medical Practice Computing Sub-Committee which among other functions, convenes the Medical Computing Interest Group quarterly. The next meeting is scheduled for September 1st, 1990.

4. As stated in the Position Statement, the RACGP supports the concept of the formation of Health Infomatics Associations. The RACGP initially supported Dr Patrick Nugawela's AMIA, but has withdrawn that support at present because it believes its reputation was used and abused by Dr Nugawela when he presented a report to IMIA in 1989. That report implied that both the ACS and the RACGP supported and had knowledge of various proposed AMIA activities, which was not true. The report was not presented to IMIA by the Australian representative at that time (Dr David Bennett of ACS), but instead was sent directly to IMIA. This both embarrassed the ACS and the RACGP in the eyes of IMIA, and revealed that Medical Infomatics in Australia was not unified despite the implication left by Dr Nugawela that AMIA was universally supported. The then President of IMIA , Prof Kaihara, and the Chairman of the Asia-Pacific Medical Infomatics Group, both suggested to me that Australia should 'get his house in order'.

5. Note that AMIA is NOT a national body, as stated in the letter of invitation.

6. Hence, I propose that this NSW medical infomatics group NOT be called AMIA (NSW) and that it not be affiliated with AMIA (WA) at least until a properly structured NSW group is operational. Then like bodies in other States (Vic, SA and Qld are establishing Health Infomatics Groups) may choose to form together to form a truly Australian Medical Infomatics Group.

In the Statement of Claim, Dr Nugawela contended that the letter conveyed the following imputations:

"(a) That the Plaintiff had represented to the International Medical Informatics Association that the AMIA had the support of the Australian Computer Society and the Royal Australian College of General Practitioners, knowing that representation to be untrue.

(b) That the Plaintiff had caused embarrassment to the Australian Computer Society and the Royal Australian College of General Practitioners and harm to their reputation by falsely claiming to the International Medical Informatics Association that they supported his organisation, the AMIA.

(c) That the Plaintiff was prepared to make false claims in order to secure support for the AMIA and thereby enhance his standing amongst professional colleagues.

(d) That the Plaintiff by the making of false statements had damaged and impeded the advancement of medical informatics in Australia."

A number of defences were filed to the plaintiff's claim. It is not now necessary to canvass the detail of them although they provide the background against which the parties did what they did. In view of the way in which the argument before this Court has been restricted, I shall confine what I say to the matters directly relevant to those submissions.

Mr Hughes, the present counsel for the appellants, was not counsel at the trial. He has, as I have said, limited the grounds of appeal pressed by him to three. In view of the nature of the submissions made, I shall detail the grounds now relied on.

The first ground relied on (ground 1 of the Amended Notice of Appeal) is:

"1. That his Honour was in error in holding that the imputations (a) (b) (c) and (d) pleaded in paragraph 5 of the Amended Statement of Claim were capable as a matter of law of arising from the matter complained of and in failing to give reasons for so holding."

The complaint as to failure to give reasons is not pressed.

The second ground relied (ground 10(3) and (6) of the Amended Notice of Appeal) relates to the plaintiff's claim for aggravated damages. The defendants contend that the judge left to the jury as apt to aggravate damages matters which, in law, are not capable of being taken into account for that purpose.

The third ground claims that the damages $600,000 were appealably excessive.

This ground requires the Court to determine whether the letter, and in particular paragraph 4 of it, asserts of or attributed to the plaintiff the things pleaded or, as I think it can be put, whether it gave those who would read it to understand what the plaintiff pleaded: see Hall-Gibbs Mercantile Agency Ltd v Dun [1910] HCA 66; (1910) 12 CLR 84 at 91; Petritis v Hellenic Herald Ltd (1978) 2 NSWLR 174. This is to be tested by what it would give "the ordinary reasonable reader" to understand: see Mirror Newspapers Ltd v Harrison [1982] HCA 50; (1982) 149 CLR 293 at 301.

The principles by reference to which the Court is to determine the imputations made by the letter in question are not in contest. Miss McColl SC in her submissions for the plaintiff Dr Nugawela has referred the Court to, inter alia, Capital & Counties Bank Ltd v Henty & Sons (1882) 7 App Cas 741 at 745; Lewis v Daily Telegraph (1964) AC 234 at 259-260; Bik v Mirror Newspapers Ltd (1979) 2 NSWLR 679(n) at 683; Farquar v Bottom (1980) 2 NSWLR 380 at 385-6; and Hepburn v TCN Channel 9 Pty Ltd (1984) 1 NSWLR 386 at 394.

In her submissions, she referred to the possibility of a document being reasonably open to more than one possible meaning, one defamatory and the other not. She submitted that if the letter was open to two different constructions, that pleaded and another, the issue was appropriate to be left to the jury: Farquar v Bottom at 386; John Fairfax & Sons Ltd v Foord (1988) 12 NSWLR 706 at 722; Boyd v Mirror Newspapers Ltd (1982) 2 NSWLR 449 at 454; Remuneration Planning Corporation Pty Ltd v John Fairfax Group Pty Ltd (Court of Appeal, 31 July 1991, unreported).

I shall take each of the imputations in turn. Each of them was dealt with in argument separately.

Before dealing with this imputation, it is proper to make a general observation. The pleadings and the argument in relation to this imputation have, in my opinion, illustrated the high degree of technicality involved in defamatory proceedings. The plaintiff's complaint in this regard was clear: he was accused of lying to the world professional body IMIA. It might be thought that, from the terms of Dr Crampton's letter, the lie was clear: his report, it was said, "implied ... that both the ACS and the RACGP supported and had knowledge of various proposed AMIA activities, which was not true". That was the lie of which he was accused. The rules of pleading in defamation require that a plaintiff specify the imputation of which he complains. Dr Nugawela did this by pleading, inter alia, par 5(a) of the Statement of Claim. But, it was said, he pleaded it wrongly: he did not extract from the relevant portion of par 4 of the letter the precise imputation which it conveyed. Therefore, it was submitted, the trial of thirty-seven days went off in a false direction and the plaintiff's claim was defeated.

It may be accepted that it is necessary that a plaintiff plead what he complains of: if he does not, there will be an argument before the jury as to what the plaintiff says the defendant did wrong. I am conscious also why this is so: it is necessary for the jury to address the imputation made by the published material and not a different imputation, and that it assesses damages by reference to that imputation and not another. Accordingly, where the imputation specified by the plaintiff is not the imputation made by the published material, the plaintiff will fail, even though another and different imputation was made by the published material and the plaintiff could have pleaded that imputation.

But, in my respectful opinion, that should not mean that the plaintiff should fail where the published material is before the jury, the imputation which it makes may be seen from it, and the plaintiff's error is merely that his pleading of the imputation errs in that it does not with complete accuracy state in the pleading the imputation that is in the published material. In the present case, it is in my opinion clear from the terms of the letter as they were before the jury what in this regard was the essence of the complaint. Where, as in the present case, the complaint is not that the published material conveys one imputation and the pleading pleads a quite different one, but that the pleader has erred in attempting to translate the imputation from the published material to the pleading, I do not think the law to be that a plaintiff's claim must necessarily fail. It would be sad if the law held the plaintiff's claim defeated because, in pleading, he did not precisely translate from the letter to the pleading the imputation as precisely as should have been done. In my opinion, it was plain to the jury what it was of which the plaintiff complained.

However, in the present case, the pleading did in my opinion embody the imputation which the letter conveyed.

The plaintiff's pleading contended that the letter conveyed the imputation, ie, gave its readers to understand, two things: that the plaintiff had represented to the International Medical Informatics Association ("IMIA") that AMIA had the support of ACS and the College; and that he had made that representation "knowing that representation to be untrue". The formal submission of the defendants was that the letter did not convey either of them. The submission, as formulated by Mr Hughes QC in the course of his address, was essentially that:

"The matter complained of is not capable of giving rise to this imputation. In considering this imputation, it must be borne in mind that the gravamen of it is the making by the plaintiff in a report of a statement which, when made, was not false but deliberately so."

In my opinion, the letter was capable of conveying and did convey that the plaintiff had represented to IMIA that AMIA had the support of each of the two bodies. This was conveyed by paragraph (4) of Dr Crampton's letter. The letter there referred to the "report" that Dr Nugawela had made to IMIA in or about November 1989. IMIA was involved in the preparation for, or at least was contemplating, a conference. Dr Nugawela wrote a letter of 23 November 1989 to which he attached the relevant report. Dr Crampton's letter said: "That report implied that both the ACS and the RACGP supported and had knowledge of various proposed AMIA activities which was not true". The submission for the appellants is, as I understand it, that that part of Dr Crampton's letter did not say that Dr Nugawela's report implied (ie, represented by implication) that both the bodies supported AMIA: it represented only that they supported (and had knowledge of) "various proposed AMIA activities". Mr Hughes QC, in elaboration of his written submissions, submitted that Dr Crampton's letter "draws a clear distinction between on the one hand general support for AMIA and on the other support for particular activities of AMIA".

If the letter be construed according to the strict grammar of that sentence and no more and if attention be confined to that sentence alone, the construction which Mr Hughes QC has advanced is one to which that part of the document is open. There may be a difference in the context of a Royal College of Practitioners between having the support of a College and having the support of the College for "various proposed ... activities".

But in answer to this several things may be said. First, even on a grammatical construction of the sentence, another construction is open. Where two bodies support a number of "various proposed ... activities" of another body, it is proper to conclude that those bodies "support" it: if they support various proposed activities of it, to that extent they support it. This is a proper use of the term "support".

Second, if the activities supported are central to what the body does, as it was open to the jury to hold they were, it would be proper for the reader to infer from what the letter said that, supporting such actions of AMIA, they supported AMIA.

Third, the imputation made by the letter, that which it gave its readers to understand, was not to be determined alone from a strict grammatical construction of the sentence in question. Dr Crampton's letter was not drawn by an equity draftsman and was not addressed to an audience of lawyers or of persons who would be expected to construe the letter according to strict grammar or with painstaking precision. The readers of the letter would not, I think, see a letter addressed by one doctor to others as intended to draw distinctions of this kind when it referred to what Dr Nugawela had said or had misrepresented to IMIA.

Fourth, in deciding what the letter gave the doctors to understand, it is not proper to refer only to the sentence in question. The doctors who read it would not have confined their attention to that sentence. They would properly have had regard to the rest of the letter in deciding what it was that Dr Crampton intended to give them to understand. As the succeeding sentences of par (4) of the letter indicated, what was in question was essentially the support of AMIA rather than support merely of some of its activities. This, I think, would be taken, inter alia, from the sentence:

"This both embarrassed the ACS and the RACGP in the eyes of IMIA, and revealed that Medical Informatics in Australia was not unified despite the implication left by Dr Nugawela that AMIA was universally supported."

For these reasons, in my opinion, the defendants' submissions in relation to this portion of the imputation (a) should not be accepted.

As to the second part of imputation (a), it is, I think, not seriously contested that the letter imputed (by "which was not true" and otherwise) that Dr Nugawela knew that what his report implied was untrue. The suggestion that Dr Nugawela had "used and abused" the reputation of the College and the suggestion of embarrassment contained in the letter would, amongst other things, warrant the ordinary reasonable reader of the letter concluding that the letter suggested that what Dr Nugawela's report implied was not merely not accurate but not accurate to his knowledge.

These imputations also were contested. But the submissions made in relation to imputation (a) were essentially the suggestions made in relation to the other imputations. It is sufficient to say that, in my opinion, imputations (b), (c) and (d) were made by the letter.

This ground related to the plaintiff's claim for aggravated damages. The plaintiff had, in his statement of claim, set forth at length matters which, he contended, should be taken into account for this purpose. During the trial, the judge, after argument, determined what matters could be relied on for this purpose. He dealt with aggravated damages and qualified privilege together. The latter is not now in question. He ruled that the matters which could be relied on were the matters set out in the document MFI 32. These were as follows:

"1. Falsity of imputations/falsity of the matter complained of.

2. Awareness plaintiff anxious to deal with allegations; defendants' decision plaintiff should be given opportunity to deal with allegations; awareness plaintiff rejecting allegations but no forewarning; no enquiries.

3. Failure to apologise, and retract, the terms of the Hunt and Hunt letter.

4. The defendants published the matter complained of having no honest belief in the truth of the matter complained of.

5. The defendants published the matter complained of with a reckless indifference to the truth of the matter complained of.

6. The defendants had an improper motive being an intent to injure the plaintiff, in particular:

6.1. to injure the plaintiff's standing in the medical informatics field;

6.2. to promote the standing of the first defendant in the medical informatics field;

6.3. to hinder and prevent the establishment of AMIA;

6.4. to promote the formation and development of opposition health informatics associations.

7. Unfair extravagant and excessive manner of publication in the following senses:

7.2 publication to key persons involved in the medical informatics field (the majority of whom had nothing to do with the RACGP);

7.3 breaching the previously recognised confidentiality of the allegations.

9. The defendants' active promotion before and after the publication of the matter complained of of alternative State and National medical/health informatics bodies.

10. The failure to put substantive parts of the defendants' case to the plaintiff and his witnesses.

11. Reckless indifference to the plaintiff's reputation.

12. Persistence in the defence of the proceedings notwithstanding the admission that when proper care was taken there was no substantive factual basis for the matter complained of, in particular:

12.1 the defendants still claim the matter complained of to be totally true and accurate;

12.3 the lack of bona fides in persisting with defences, and associated matters in the face of various admissions and matters; and the case has been used to continue with the defendants' intention to destroy the reputation of the plaintiff."

"The defendants had prepared a report dated 14 January 1990 and circulated it prior to 17 July 1990. This report was unfair and was circulated by the defendants who had no honest belief in the truth of the report and/or was published with reckless indifference in the truth of the report."

The plaintiff's submissions in this regard were directed only to paragraphs 6(vi) and (x) of the Notice of Appeal. (It is accepted that sub-pars (vi) and (x) may be taken together).

The submission was to the effect that the matters there referred to relate to the intention or plot (the term "plot" was used by the plaintiff in argument) of Dr Crampton and those associated with him to (I put the matter in a neutral form) achieve the result that the body through which the College would act or achieve its purposes in the field of informatics should be the body set up by Dr Crampton, IMIA, and not the body set up by Dr Nugawela, AMIA. Mr Hughes QC contended that this, as a purpose, was a legitimate purpose, not lacking in bona fides and accordingly was not a purpose within the principles established by Triggell v Pheeney [1951] HCA 23; (1951) 82 CLR 497 as relevant for the purposes of aggravated damages.

In my opinion the defendants' submissions in this regard should not be accepted. In ruling upon the matters which were relevant to aggravated damages, the judge did not intend that each of the matters itemised in MFI 32 and the Noticeof Appeal should be treated separately. His Honour did not contemplate that each of the paragraphs of the document should be taken separately and its relevance to aggravated damages should be determined in isolation. The judge intended that the paragraphs should, as far as was appropriate, be taken together. So understood, the matters referred to in par 6(vi) and (x) were in my opinion relevant to aggravated damages. Taken together, the plaintiff's allegations involved that the defendants published the letter and did what was done in order to injure Dr Nugawela's reputation; that the purpose of doing that was to assist Dr Crampton in his "plot" that his association and not AMIA should be the body associated with informatics within the College. So understood, the matter was relevant to an issue of aggravated damages. Accordingly, this ground of appeal has not been established.

The defendants contended that the quantum of damages was appealably excessive. The jury awarded $600,000. As the arguments have suggested, there were two substantial components of the award: actual economic loss and general damages. The thrust of the defendants' submissions has been that, giving the fullest effect appropriate to the actual economic loss, the balance of the award, being for general damages, is so large as to be appealably excessive. I shall first consider what amount could have been awarded by the jury to compensate the plaintiff for his actual economic loss and I shall then consider the general damages.

However, before coming to consider these two components of the award, it is appropriate to refer again to the nature of the wrong done and the damage apt to have been done by it.

Upon the view of the facts which it is proper to take on this appeal, the wrong inflicted upon Dr Nugawela was a serious one. Reference has been made in argument to the remarks made by the trial judge Levine J. His Honour said:

"This case was about malice and was about truth, as the defendants' counsel said in his opening address to the jury, and on both of the issues it fairly can be said the defendants failed miserably. As to the former, there was an abundance of evidence damning the conduct of both defendants and if the only matter on which the plaintiff was to rely was the 'black fella/black fellow' comment, by Dr Crampton, given the concession made by the second defendant that it was bound by the first defendant's state of mind, the defendants would still have been in a hopeless position."

In my opinion, his Honour's remarks were justified. Had it been possible for the jury to award exemplary or punitive damages, they may well have done so. If there be a case for punitive damages, this was it.

Upon the facts as they are to be assumed to have been found by the jury, Dr Crampton publicly accused Dr Nugawela of lying in a professional context. He did so in circumstances such that what he did had behind it the Royal College of which they each were members, in that it might be taken that the accusations were made not merely by Dr Crampton personally but by him as acting for the Royal College and as an accusation by the College or, at least, an accusation for which it was responsible. He made that allegation without any reasonable basis for believing that it was true and he made it not caring whether it was true or not. He made it in circumstances in which, as he was aware, Dr Nugawela did not know it was going to be made and had no opportunity to reply to it. The allegation was made in part at least in order to further Dr Crampton's own interests and for this reason he saw fit to denigrate Dr Nugawela. When Dr Nugawela took exception to what had been done, Dr Crampton refused to apologise, persisted in the allegations, and did so in the context of remarks (the "black fella" comments) which undoubtedly exacerbated the hurt and the harm to Dr Nugawela. During a long and no doubt painful trial, the baseless allegation was persisted in to the end.

The experience of the common law over many years has been that there is a function to be served by the award of punitive damages in cases of defamation. The suggestions made in England for the limitation of the power of the courts to award such damages have, in my opinion, not been well received and the continued importance of the capacity to deal with defamation in this way has been supported by the observations made in such cases as Broome v Cassell & Co [1972] UKHL 3; [1972] AC 1027 (defamation of a war hero by a Mr David Irving); see generally Gatley on Libel and Slander (7th ed) par 1361(N36). There are, in my experience, some cases in which damages of a punitive kind are essential if justice is to be done between the parties. What is in question is not the approach adopted in some parts of the United States of America to the award of punitive damages in other branches of the law. Defamation is a tort of a kind different from the general run of tortious wrongs. There are aspects of the harm caused by defamation which cannot be effectively dealt with except by punitive damages.

However, in New South Wales there is presently no power to award punitive damages: Defamation Act 1974 s 46(3)(a). Damages for defamation "shall be the damages recoverable in accordance with the common law" but such damages are limited to damages for "harm suffered by the person defamed". The statute provides:

(b) shall not be affected by the malice or other state of mind of the publisher at the time of the publication complained of or at any other time, except so far as that malice or other state of mind affects the relevant harm."

See also s 46A, added by Act No 93 of 1994, Schedule 1(7).

It has not been argued that the provisions of s 46(3)(a) are of significance in determining the defendants' appeal against the quantum of the award.

It is not in contest that what the defendants' did warranted the award of aggravated damages. The principles relevant to the assessment of aggravated damages have a deceptive simplicity. It has been said that, in awarding aggravated damages, the court remains restricted to compensating the plaintiff for the loss actually suffered by him as the result of the defamation but, in assessing those damages, the court may adopt the highest level of damages open as compensatory damages. In Broome v Cassell & Co: at 1085; Lord Reid said:

"Damages for any tort are or ought to be fixed at a sum which will compensate the plaintiff, so far as money can do it, for all the injury which he has suffered. Where the injury is material and has been ascertained it is generally possible to assess damages with some precision. But that is not so where he has been caused mental distress or when his reputation has been attacked - where, to use the traditional phrase, he has been held up to hatred, ridicule or contempt. Not only is it impossible to ascertain how far other people's minds have been affected, it is almost impossible to equate the damage to a sum of money. Any one person trying to fix a sum as compensation will probably find in his mind a wide bracket within which any sum could be regarded by him as not unreasonable - and different people will come to different conclusions. So in the end there will probably be a wide gap between the sum which on an objective view could be regarded as the least and the sum which could be regarded as the most to which the plaintiff is entitled as compensation.

It has long been recognised that in determining what sum within that bracket should be awarded, a jury, or other tribunal, is entitled to have regard to the conduct of the defendant. He may have behaved in a high-handed, malicious, insulting or oppressive manner in committing the tort or he or his counsel may at the trial have aggravated the injury by what they there said. That would justify going to the top of the bracket and awarding as damages the largest sum that could fairly be regarded as compensation."

See also Andrews v John Fairfax & Sons Ltd (1980) 2 NSWLR 225 at 240, 249 and the observations of the other members of the House of Lords in Broome v Cassell & Co: at 1084, 1097, 1101, 1106, 1113, 1124 and 1133.

I shall assume that, for the purpose of assessment of aggravated damages, the "top of the range" approach is to be adopted and I shall consider the components of the plaintiff's damages upon that basis.

In respect of the actual economic loss, the plaintiff submitted that, absent the defamation, he would have been in a position by about 1994 to be able to earn significant sums in the field of medical informatics. He referred in his evidence to earnings by way of consulting fees, conference speaking fees, and benefits associated with his being, as it were, an Australian authority upon the topic. Dr Crampton himself had earned significant fees from activities generally of this kind. The jury was entitled to conclude that, absent the defamation, the plaintiff could and would have earned in this way.

In determining the maximum sum that could have been awarded for, as it was correctly described, the plaintiff's chance of earning such moneys, it was necessary for a number of contingent factors to be taken into account. The rate of earnings which he would have achieved was not clear: the hourly fees payable for consulting and the like ranged from about $60 per day to $100. It was necessary to determine, if the earnings of Dr Crampton of $20,000 per annum were to be relied upon, whether such earnings were gross or net after deduction of expenses of earning them. It was necessary to determine whether, in undertaking work of the kind in question, the plaintiff would give less attention to his work as a general practitioner and accordingly suffer an offsetting loss. Little or no attention was paid to these matters at the trial. Mr Hughes QC, for the defendants, submitted that essentially there was a loss, not of identifiable sums, but of a chance. He pointed to the difficulty of assessing the value of a chance in this regard: see generally Todorovic v Waller [1981] HCA 72; (1980) 150 CLR 402; Malec v JC Hutton Pty Ltd [1990] HCA 20; (1990) 169 CLR 638.

There is force in the submissions which, in this regard, were made by Mr Hughes. But two things at least may be said. First, it is, of course, for a plaintiff to prove the damages which he claims. But, given the necessary evidence, assumptions are not readily to be made in favour of a defendant wrongdoer. Where the assessment of damages has been committed to a jury and where the damages are to be approached in the manner to which Lord Reid referred, an appellate court on review must allow an appropriate scope for the inferences which it was open to the jury to make. The jury could, for example, infer that, from about 1994 or thereabouts and for some time, the plaintiff would have derived income from activities relating to medical informatics; their inferences would not have been limited to the $20,000 or so per year said to have been earned by Dr Crampton; and they could have had regard to fees of a significantly higher order than had previously been earned, eg, reference was made during argument to $1,000-$1,500 per day.

Second, an appellate court reviewing a jury's verdict must have in mind the wide scope afforded to judges in drawing inferences and making assumptions for the purposes of quantifying damages. The assessment of damages in the conventional cases of negligence involves contingencies of a lesser order than those to which Lord Reid referred in the speech to which I have directed attention. In conventional cases of that kind, the courts of this country cope with uncertainties of a high order and quantify damages by reference to them. During the past twenty years and more, the courts have, in periods of inflation and substantial financial uncertainty, felt able to resolve into money awards uncertainties of the kind illustrated in Government Insurance Office of New South Wales v Cox [1976] HCA 13; (1976) 50 ALJR 509 and succeeding cases.

In my opinion the jury could have accepted that, as the plaintiff suggested, it was his intention to pursue income earning of the kind here in question. They could have concluded that he was a person of industry and energy who would have pursued that activity successfully. They could have accepted that what he had done previously in relation to AMIA provided some basis for that prediction. And, I think, there is no reason why the jury could not have concluded that Dr Nugawela could and would have pursued income earning of this kind until the time of his retirement from practice. He was, at the time of the trial, in his mid-forties. The jury could have made an assessment over a period of some twenty years or so.

During argument, counsel speculated as to the amounts which the jury could have included in their award to compensate the plaintiff for his actual economic loss. These estimates or speculation were provided for the assistance of the court and it would be wrong to hold counsel to them. It is sufficient to conclude that the jury could have included in their award a substantial sum.

I come now to general damages. In a case such as this, general damages constitute compensation essentially for the three main elements of loss: personal distress, damage to character and reputation, and vindication: see Carson v John Fairfax & Sons Ltd [1993] HCA 31; (1993) 178 CLR 44 at 69; (1991) 24 NSWLR 259 at 296.

Dr Nugawela's evidence was that the personal distress and anguish caused to him by the original publication of the letter was very great. It is clear that the publication had serious and immediate effects upon Dr Nugawela, greater than might ordinarily have been anticipated. The effect it had was not merely emotional: it had direct physical effects on him. In his evidence he said:

"I was stunned. I shook. I wasn't able to read it all. I read a bit of it. I took it into my room. I had no surgery on at the time. I sat down. I was gasping for breath, I felt dizzy and I felt completely drained. I had a sick feeling in my stomach. I was absolutely shocked to read this. I read a bit and I put it back in the file of papers. I took it back out again and I read it again and I just trembled. I didn't know what to do.

Q. What was it about the letter in particular which aroused these reactions in you?

Q. Doctor why did you have that reaction when you read that letter?

A. I was very hurt because it was all untrue. It was written on the letterhead of the Royal College, my professional body, the body I have always looked up to, upheld my professional standards, the body that I have always regarded as having engaged in ethical and proper behaviour and I just could not accept that this had come up as a shot out of the blue. I saw the crest of the Royal College at the top, it was a letterhead I was very familiar with over the years. It in fact was saying something about me that was patently untrue.

Q. What did you think it was saying about you Doctor?

A. It said I had used and abused it. It said that I lied, I couldn't be trusted, I had let down people with whom I had worked both within the College, within the Computer Society, within the International Body. It accused me of giving a bad name to this country overseas. I had just recently become Australia's representative to the World Body and now I was accused of debasing Australia's image overseas. I couldn't be trusted, I just found it very hard to accept all of these concepts that were now in print right before me."

The effects did not cease. They continued on: at least, the jury might well have concluded that they continued. And the effects of what Dr Crampton did thereafter would have added a basis for such a conclusion.

The actions of Dr Crampton after the publication, insofar as they aggravated his personal hurt and anguish, had themselves a substantial effect upon him. He referred to this in several respects. Dr Crampton did not allow him the opportunity to reply to what had been done: this, he said, with some justification, "makes me angry because it's a continuing endorsement of his original comments". Dr Crampton continued, over a period of several years, to assert the truth of what had been said in the letter and continued this until the trial. And he did this in a manner which, the jury no doubt concluded, kept the hurt and anguish fresh in Dr Nugawela's mind: his use of the present tense (it "makes me angry because ...") provides confirmation of this.

In this regard, the "black fella" comment could have been seen as providing particular distress to the plaintiff. The judge ruled, and it is not now contested, that this was a matter which could go to aggravated damages. It was established that, when the plaintiff wrote to Dr Crampton and tried to deal with his refusal of an apology by the commencement of proceedings, Dr Crampton not merely did not do so but, in the presence of their mutual professional colleagues, referred to Dr Nugawela as "the black fella". He admitted he did this on "two or three occasions". This came back to Dr Nugawela as, it might be inferred, Dr Crampton would have foreseen would happen.

Accordingly, the jury could have concluded, the hurt which the plaintiff felt was substantial, it was renewed by what Dr Crampton did from time to time, and it was continued until the end of the trial.

What is to be attributed, by way of damages, to the personal distress and anguish which defamation causes? More accurately, what is the limit beyond which a jury may not, in this regard, go?

There is no yardstick for measuring these matters. Value may be determined by a market: there is no market for this. There is no generally accepted or perceptible level of awards, made by juries or by judges, which can be isolated and which can indicate the "ongoing rate" or judicial consensus on these matters. And there is, of course, no statutory or other basis. In the end, damages for distress and anguish are the result of a social judgment, made by the jury and monitored by appellate courts, of what, in the given community at the given time, is an appropriate award or, perhaps, solatium for what has been done: compare generally the well-known observations in John Fairfax & Sons Ltd v Uren [1966] HCA 40; (1966) 117 CLR 118.

It is, in my opinion, important to recognise the normative nature of this part of the award and, indeed, of other elements of the damages in defamation cases. It has been indicated in the cases that the award of damages for, eg, personal injuries are to be taken into account in determining what should be awarded and what are the limits of what may be awarded: at least, they are to be taken into account in the manner referred to in Carson v John Fairfax & Sons Ltd [1993] HCA 31; (1993) 178 CLR 44 at 56-60. There is, in the sense there suggested, "an appropriate relationship between the scales of values in the two classes of case": at 59, note 38. It will be necessary in the future for the courts to spell out the nature of that relationship and the use which may be made of the relevant portion of awards in personal injuries cases in determining the proper limits of awards in defamation cases. If there is a proper comparability between what is suffered in a case of personal injury and what is suffered in a defamation case, then the basis of comparability is reasonably clear. Ordinarily, perhaps, what is suffered in a defamation case is different in kind from what is suffered in a personal injury case. Then, prima facie, the level of compensation given by courts or juries for the loss of a leg or the like is of little assistance in deciding what should be the compensation for the difficulties resulting from defamation. If the two are to be treated as comparable for the purpose of determining whether an award of damages for defamation is appealably excessive, it must, I think, be because of the normative character of awards of damages. As I have suggested, there is no market, in any real sense, to establish the value of the loss of an arm or a leg. The award of a particular sum as compensation for such a loss is to be justified because it is what right thinking people in the community, that is, the judges, see as the appropriate level of compensation. Similarly, the justification for an award for the distress and anguish caused by defamation is the conclusion of right thinking people that that is, in their community, the appropriate measure of compensation. If the two are to be compared, one with the other, it is because it is proper to compare normative evaluations of this kind. I shall refer to this subsequently in other respects.

Taking account of what is generally accepted as the level of compensation appropriate in personal injury cases, I am of opinion that the jury in the present case could have concluded that the hurt which the plaintiff felt was substantial, that it was renewed by what Dr Crampton did from time to time, and that it was continued until the end of the trial.

It was open to the jury to conclude, and no doubt they did conclude, that what Dr Crampton and the College did caused substantial and lasting damage to Dr Nugawela's reputation as a person, as a general practitioner, and in the field of medical informatics. The imputations which the jury could take to have been made have been detailed. They involved, in general, lying to professional colleagues, lying in a matter affecting the Royal College and its members, doing so for the purpose of securing an advantage to himself, and using and abusing his relationship with the Royal College. Charges of this kind, if true, would have a particular effect in the case of a professional man, a member of the medical profession. Such conduct would be likely to destroy his reputation not merely among College members and his professional associates but among the medical profession generally. A fellow professional would be likely to refuse to have significant dealings with a person who acted in that way: he could, he might think, not be trusted. The effect of such conduct, in other contexts, has been referred to: cf Bannister v Walton (1993) 30 NSWLR 699; and McBride v Walton (Court of Appeal, 15 July 1994, unreported).

In some cases, a person's reputation is, in a relevant sense, his whole life. The reputation of a clerk for financial honesty and of a solicitor for integrity are illustrations of this. The reputation of a doctor is, I think, of this character: at least, it is so where a substantial part of his work is in an area where he acts on reference from or with the recommendation of other doctors. If Dr Crampton's allegations were true, Dr Nugawela would have no future in informatics or in any matter related to his dealings with other doctors. What he could do as a general practitioner in his relations with his patients might well be affected. His relations with consultants or with hospitals to which he might wish to send his patients might well be seen to be affected. In this regard it is relevant that, as the plaintiff said, Dr Crampton did not ever apologise to him. This, he said, "makes me angry because it's a continuing endorsement of his original comments". And there was, he said, no apology from the College in respect of the letter.

In addition to the positive evidence in this regard, the jury might, in my opinion, have inferred that in a professional grouping such as medicine, allegations made formally suggesting lying and untrustworthiness of a known member of the profession would receive significant coverage. It is a matter in which, gossip apart, professional colleagues have an interest: the trustworthiness, actual or reputed, of a professional colleague is a matter of a legitimate and ongoing interest.

Reference was made at the trial and by the judge to, as it was described, "the grapevine effect". The objection taken in the Amended Notice of Appeal to the judge's ruling on this was withdrawn by Mr Hughes QC. Miss McColl SC emphasised that, at the trial, the grapevine effect was not a small matter: it received considerable emphasis in the plaintiff's case.

This is, in my opinion, a case in which the comments of Lord Hailsham of St Marylebone LC are of relevance. In Broome v Cassell & Co [1972] AC at 1071, the Lord Chancellor said:

"In actions of defamation and in any other actions where damages for loss of reputation are involved, the principle of restitutio in integrum has necessarily an even more highly subjective element. Such actions involve a money award which may put the plaintiff in a purely financial sense in a much stronger position than he was before the wrong. Not merely can he recover the estimated sum of his past and future losses, but, in case the libel, driven underground, emerges from its lurking place at some future date, he must be able to point to a sum awarded by a jury sufficient to convince a bystander of the baselessness of the charge."

"This is why it is not necessarily fair to compare awards of damages in this field with damages for personal injuries. Quite obviously, the award must include factors for injury to the feelings, the anxiety and uncertainty undergone in the litigation, the absence of apology, or the reaffirmation of the truth of the matters complained of, or the malice of the defendant. The bad conduct of the plaintiff himself may also enter into the matter, where he has provoked the libel, or where perhaps he has libelled the defendant in reply. What is awarded is thus a figure which cannot be arrived at by any purely objective computation. This is what is meant when the damages in defamation are described as being 'at large'."

In view of the submissions made, it is proper to add a further comment. In deciding what are the limits of what may be awarded for loss of reputation, it is, of course, necessary to determine two things: what value the law places, or allows a jury to place, upon reputation; and how far the plaintiff's reputation has been destroyed in the instant case. I have referred to the second of these. It is to the first to which this observation is directed.

This is a matter upon which, no doubt, judges may differ. If there be a matter upon which essentially the Carson litigation turned in the appellate courts, it was, I think, this. And I am conscious that the view adopted by the final appellate court as to the values which a community is to adopt must be accepted and applied throughout the judicial hierarchy: cf, for example, the observations in Broome v Cassell & Co at 1053 et seq. I am conscious also that, in this regard, the constitutional tribunal which (subject to judicial limitations) is to determine social values of this kind is the jury. If and insofar as it is relevant and proper to refer to it, it is to be noted that, in the Carson litigation, the verdicts of the jury totalling $600,000 in the first trial were set aside as excessive, the plaintiff's case was retried, and the jury returned verdicts resulting in a judgment of some $1.3 million.

In the end, the courts must mark out the limits of what a jury may do, even in defamation. And, in doing so, the courts must indicate, inter alia, the maximum value which they see as appropriate to the reputation of a professional man. I record my opinion that, if this were the only matter to be taken into account in assessing general damages, I would not see $500,000 as being beyond the range of a sound and sensible jury. The damage done to the plaintiff's reputation would properly be determined by reference to it.

This is my view of a man's reputation and the value that the law should place upon it. I am conscious that I may be wrong. I hope I am not.

The nature of the defamation and the circumstances of it were such as to make vindication of particular importance. The effect of the defamation upon the plaintiff was not merely that his professional reputation and personal honesty had been impugned. Had that been the only problem, the necessity for vindication would have required that the damages be appropriately large. This is the purpose of this aspect of damages in defamation cases, as evidenced by what has been said in the Carson case [1993] HCA 31; (1993) 178 CLR 44; (1991) 24 NSWLR 259; and in Broome v Cassell & Co [1972] UKHL 3; [1972] AC 1027. There were in this case two other aspects of the matter. The allegations against the plaintiff involved his professional reputation and personal honesty. Those above all who were to see a judgment for him as a vindication of him were his professional colleagues, those associated with his activities as a doctor, and those who would assume that what the Royal College of General Practitioners did was right unless firmly convinced that it was wrong. The jury might conclude that such persons would not be convinced merely by a finding by a court, one way or the other, as to whether the plaintiff had lied. It would need the emphasis of a substantial sum in damages to bring home to such persons the gravity of what had happened to the plaintiff, the extent of the findings of the court in his favour, and the seriousness of the finding by the court that what Dr Crampton and the College had done was wrong. The jury might conclude that, having regard to what they were permitted to know of the earnings and/or the financial position generally of successful medical practitioners, that sum would need to be substantial indeed.

In this regard, "the grapevine effect" and the "lurking place" observation of Lord Hailsham are relevant. The award must be sufficient to ensure that, the defamation having spread along the "grapevine" to which Miss McColl SC referred, and being apt to emerge "from its lurking place at some future date", it was "sufficient to convince a bystander of the baselessness of the charge".

In my opinion, the general damages component of the verdict could have been large. The question is whether it could have been large enough to produce, with what was awarded for actual economic loss, the verdict of $600,000.

I shall not detail the principles relevant to the examination by an appellate court of the quantum of a jury's verdict: those principles have been authoritatively considered recently in the Carson litigation.

I am conscious, in the sense referred to in the Carson case, of the need to have in mind what money represents and, in determining what it represents for this purpose, to understand the changes which have taken place. Price indices must be used with care. But, if it be proper to have regard to such matters, I note that the consumer price index figure in the Australian Bureau of Statistics' Historical Series 1 Index (Sydney) for September 1972 was 20, for June 1993 was 108.4 and for March 1996 was 119.1.

But in the end, damages represent, in respect of some at least of the components of them, a normative or social assessment of what is appropriate, fair or just (the Court need not stand upon the particular terms) to compensate the plaintiff for what has been done to him. There is no market or tariff to determine this. Therefore, to the extent to which I have referred, the limits which are to be imposed upon what a jury may do - what the jury has done in this case - depend upon the value which the appellate court system is to put upon reputation and upon what is necessary to vindicate the plaintiff. I am, as I have said, conscious of the views expressed by the majority of the High Court and of this Court in the Carson litigation. But I do not regard that case as comparable, in impact, to this. In my opinion, the law should place a high value upon reputation and in particular upon the reputation of those whose work and life depend upon their honesty, integrity and judgment. This Court should record that its view is such. And it should record that, where hurt and reputation are involved, the vindication of the plaintiff should not be left to speculation: the damage to be awarded will be so large as to make what the Court has done plain and clear.

If, to do this, it is necessary that the damages must be large, then they should be large. The fact, if it be such, that damages for personal injury, quadraplegia and the like, are less is, in my opinion, no reason for not doing, in defamation, what should be done. If there be an unacceptable disproportion, it is to be removed, not by reducing damages in defamation below what they should be, but by adjusting what is awarded for personal injury. Were the matter free from authority, I would have little hesitation in accepting that an award of the present kind would not be beyond the limits of a sound discretionary judgment.

Notwithstanding the submissions of Mr Hughes QC, I am not satisfied that the jury's award was appealably excessive.

HANDLEY JA: In this appeal I have had the benefit of reading in draft form the reasons for judgment of Mahoney P. I agree with his reasons and conclusions. I do not wish to add reasons of my own on the issues concerning the availability of the imputations, or the grounds capable of supporting an award of aggravated damages which were left to the jury. However I do wish to add additional reasons for my conclusion that the appellant's challenge to the damages awarded by the jury should fail.

The jury were entitled to award compensatory and aggravated damages for the serious defamatory imputations made about the plaintiff. In addition the plaintiff had a substantial case for compensatory damages for his economic losses resulting from the defamation. I gratefully adopt the analysis of Giles AJA on this issue.

Counsel for the defendants allowed the evidence of the plaintiff's economic loss to be left to the jury without any directions from the judge as to the approach the jury ought to adopt to this claim. The jury were not instructed that they should make some general allowance for the business expenses that would be incurred in earning income as a consultant in medical informatics, that they should also allow for the income the plaintiff would forego from his general medical practice while he was consulting, and that allowance should be made for income tax. There was no specific evidence on any of these issues, but the jury would have been entitled to allow for them in a general way relying on their commonsense and knowledge of affairs.

The judge gave the jury no directions on these issues and no directions were sought by the experienced counsel then appearing for the defendants. SCR Pt 51 r 16 (1)(a) provides that this Court shall not order a new trial on the ground of non-direction unless it appears that some substantial wrong or miscarriage has been thereby occasioned. It was well established prior to the making or r 16 that a party who had failed to seek further directions from the trial judge, or who had otherwise acquiesced in the course taken at the trial, would ordinarily be unable to obtain an order for a new trial based on such matters. See Burchett v Kane (1980) 2 NSWLR 266.

The difficulties facing an appellant in that position have been increased by the making of r 16, and it is well established that a new trial will only be granted in the most exceptional circumstances where the point relied upon was not taken before the trial judge. Quite properly the appellants did not attempt to rely upon the absence of appropriate directions on these questions as a ground for a new trial. However, in my judgment they cannot rely upon these matters indirectly when challenging the jury's verdict as being appealably excessive.

Since the Court has concluded that the other grounds of appeal must fail, it can only set aside the jury's verdict if it is satisfied that it was so high that no reasonable jury could have awarded that amount. The Court must be satisfied that the jury have misconducted themselves and failed to perform their duty in awarding the amount they did. See Coyne v Citizen Finance Ltd [1991] HCA 10; (1991) 172 CLR 211 at 227-8, Carson v John Fairfax & Sons Ltd [1993] HCA 31; (1993) 178 CLR 44 at 60-2. This Court cannot find judicially that the jury acted unreasonably and misconducted themselves because, without appropriate instruction from the trial judge, they awarded damages for the plaintiff's economic loss on a wrong basis for example without allowing for the effect of income tax. How could that be characterised as misconduct or unreasonable? How were the jury to know that this was the law unless they are given that direction? The jury could not deduce the appropriate principle by using their commonsense alone. The law of Australia was different prior to British Transport Commission v Gourley [1955] UKHL 4; (1956) AC 185, and it nearly became different again after Atlas Tiles Ltd v Briers [1978] HCA 37; (1978) 144 CLR 202.

The reasonableness of a jury's verdict must be judged against the standards established by commonsense and the directions they were given. See Wynbergen v The Hoyts Corporation Pty Ltd (Court of Appeal, 2 August 1996, unreported). It follows, as Giles AJA has demonstrated, that the jury were entitled to include in their verdict an amount for economic loss in the order of $278,000 without acting unreasonably or misconducting themselves. If that is correct, the challenge to the jury's verdict must fail, for in my judgment it could not possibly be said that an amount in the order of $312,000 was unreasonable compensation for the plaintiff's non economic losses.

I entirely agree with what Mahoney ACJ has written on the subject of the plaintiff's non economic losses. In my opinion the jury's award could be supported even if they had not been entitled to include any amount for economic loss. However this case has unusual features which the reported cases indicate have not commonly occurred in previous defamation cases.

The plaintiff had demonstrated a great interest in and capacity for medical informatics, namely the use of computer technology in the practice of medicine for both professional and business purposes. This was, as one would expect, a rapidly developing area both in Australia and overseas. This interest led the plaintiff to take an active role in this field in his adopted home State of Western Australia. In 1985 he was invited by the Royal Australian College of General Practitioners to establish a medical computing interest group in Western Australia for the College. Between 1986 and 1990 he was the inaugural Western Australian member of the National Computer Committee of the College.

In 1987 he organised a successful computer workshop at a medical conference in Singapore. The following year he developed the concept of an Australian Medical Informatics Association (AMIA), and on the 30 June wrote to Dr Crampton on this topic. In the same year he organised a successful conference in Singapore on the use of computers in medical practice. In February 1989 the College resolved to become a founding member of AMIA, and in October 1989 the Australia Computer Society did likewise. On the 23rd November that year, the plaintiff wrote a report to the International Medical Informatics Association (IMIA) for its conference in Singapore. This report later became the subject of Dr Crampton's letter of 17 July 1990 which the jury found defamed the plaintiff.

On 3 December 1989 Dr Crampton commenced his attempts to stop the plaintiff setting up AMIA, and began to promote a rival organisation in which he would have an important role. The respondent's chronology chronicles the various steps taken thereafter by Dr Crampton for these purposes. In March 1990 the plaintiff organised a successful conference in Perth on health information technology. He then took steps to promote a branch of AMIA in New South Wales. The inaugural meeting of this branch took place on 17 July that year. The plaintiff did not attend, but Dr Crampton did, and distributed his defamatory letter to those in attendance. This succeeded in preventing the establishment of a branch of AMIA in New South Wales. This check to the development of AMIA proved to be decisive. The momentum that AMIA had been developing was, as it happened, irretrievably lost.

Dr Crampton's rival organisation, Health Informatics Association of Australia (HISA), which was launched in January 1991, became in time the dominant Australian body. The contest between the two organisations culminated in a contested election which took place at the Dresden meeting of IMIA in September 1994. The voting was 24 for HISA and 2 for AMIA with 4 abstentions. HIFA became the Australian representative organisation with IMIA.

The jury were entitled to find that the poison in Dr Crampton's letter of 17 July 1990 had succeeded in destroying AMIA, and displacing the plaintiff from the pre-eminent position he had held prior to July 1990 in the medical informatics field in Australia. They would also be entitled to find that the poison or its effects had spread throughout the international medical informatics community and was a cause of AMIA's failure at Dresden.

The jury were therefore entitled to find that the defamation had caused the plaintiff to lose the previous eminent and honoured position he had held in the medical informatics field in this country, and had prevented him from obtaining a more eminent position, and an eminent and honoured position internationally, in this field. These were substantial losses. Men and women pursue careers, and activities associated with their careers, for reasons other than money, such as job satisfaction, prestige, honour, and recognition by one's professional peers, locally, nationally and internationally. Successful Queen's Counsel give up highly paid careers at the Bar to accept judicial appointment. Professional men and women spend time in writing books or learned articles and giving learned papers in their field for little or no financial reward. Doctors who could earn large incomes in private practice teach at hospitals or universities, engage in medical research on substantially lower incomes, or work in Third World countries.

A Queen's Counsel about to be appointed to the High Court of Australia, and passed over because he or she had been seriously defamed, would, in my view, suffer a great injury. He or she was prepared to suffer a substantial loss of income in order to enjoy the non financial rewards associated with such an appointment. That "sacrifice" would indicate the subjective value the lawyer placed on such an appointment, and the job satisfaction that he or she expected to receive. Could it be said merely because there had been no economic loss, and may even have been economic benefits, that such a plaintiff has not suffered a grievous loss?

My researches have not revealed the existence of a defamation case where the plaintiff lost an honourable and prestigious position in his professional field which did not carry or attract substantial economic benefits. However, I do not doubt that substantial damages can properly be awarded for such a loss. The question is covered by statements of general principle in earlier cases. Thus in McCarey v Associated Newspapers Ltd (No 2) (1965) 2 QB 86 at 104 Pearson LJ said:

"Compensatory damages (for defamation) ... may include ... actual pecuniary loss and anticipated pecuniary loss or any social disadvantages which result, or may be thought likely to result, from the wrong which has been done".

"In an action for defamation, the wrongful act is damage to the plaintiff's reputation. The injuries that he sustains may be classified under two heads: (1) The consequences of the attitude adopted towards him by other persons as a result of the diminution of the esteem in which they hold him because of the defamatory statement; and (2) The grief or annoyance caused by the defamatory statement to the plaintiff himself ... Under head (1) ... it may be possible to prove pecuniary loss, such as loss of practice or employment, or inability to obtain fresh appointments. ... But the major consequences under head (1) may be purely social and lie in the attitude adopted towards the plaintiff by persons with whom he comes into social or professional conduct".

On principle professional disadvantages which do not cause actual pecuniary loss must also be recoverable.

Similarly in Carson v John Fairfax & Sons Ltd [1993] HCA 31; (1993) 178 CLR 44 at 70-1, Brennan J said:

"In order to achieve the purpose of vindicating reputation, damages for defamation are quantified by reference, inter alia, to what is needed to achieve that purpose ... Other heads of damage are compensation for the external consequences produced by the publication of the defamation and `a solatium' for the plaintiff's internal hurt, that is, for the complex of reactions that the plaintiff has experienced as the result of the publication and its external consequences ... the consequences of publication include not only the insult publicly inflicted on the plaintiff but also the effect of the defamation on those to whom it is published, any diminution in the regard in which the plaintiff is held by others, any isolation produced (causing the plaintiff to be `shunned or avoided' is the traditional formula) and any conduct adverse to the plaintiff engaged in by others because of the publication of the defamatory matter".

See also John Fairfax & Sons Ltd v Carson (1991) 24 NSWLR 259 at 298-9 per Mahoney JA.

In personal injury cases general damages can be awarded for loss of amenities of life and loss of enjoyment of life which may include the loss of the ability to pursue a sporting career as an amateur or modestly remunerated professional, a career which may not be highly remunerated, such as professional ballet dancing (cf Proudnam v Yellow Express Carriers Ltd (1970) 1 NSWR 495), or the loss of the non economic benefits of marriage. Cf Jackson v Jackson (1970) 2 NSWR 454 at 461 per Sugerman P, and Graham v Fogarty (1970) 92 WN (NSW) 452 CA.

If Dr Nugawela had been prevented by personal injuries negligently inflicted from pursuing his career in medical informatics, in my view a substantial sum could properly have been included in his general damages to compensate for this loss. The jury were entitled to award no less for that loss in the present case. Moreover the jury were entitled to conclude that notwithstanding the vindication of the plaintiff's reputation by their award, his loss of pre-eminence in the medical informatics field in this country was likely to be permanent.

In my judgment the jury's award should not be disturbed, and the appeal should be dismissed with costs.

GILES AJA: In the light of the reasons of Mahoney ACJ, which I have had the advantage of reading in draft, I can briefly indicate why I agree that the appeal should be dismissed with costs.

The first question was whether imputations (a), (b), (c) and (d) could arise from the letter of 17 July 1990. It was argued that they could not because -

(i) as to imputation (a), the third sentence in para 4 of the letter referred to support of "various proposed AMIA activities" whereas the imputation referred to support of "the AMIA";

(ii) again as to imputation (a) and as to imputation (c), the imputation referred to a representation which "was not true" whereas the imputation asserted or required that the plaintiff knew that the representation was untrue;

(iii) as to imputations (b) and (d), the falsity to which they referred had to be objective falsity, without any element of knowledge that the claim was or claims were untrue, and objective falsity could not be found in the letter.

In response to the first argument, in my opinion, in its context the third sentence in para 4 of the letter was capable of conveying support of AMIA. The appellants' argument sought to draw a distinction akin to support of a political party while disapproving of some of its policies, but such a distinction is not necessarily to be found in the letter read as a whole and, as Mahoney ACJ has pointed out, the succeeding sentences in the letter would entitle the ordinary reasonable reader to conclude that the representation was concerned with general support of AMIA or at least with such extensive support as would be correctly described, notwithstanding qualifications of some of its activities, as support of AMIA.

In response to the second argument, in my opinion the same sentence when read in context could readily convey knowledge that the support was absent. That flows at the least from the earlier reference to the College's reputation being "used and abused", and the argument that "abused" should be confined to the making of an unintentionally untrue statement is unacceptable. So far as it was said that the second sentence of para 4 of the letter conveyed that the College supported AMIA at the time of the report, the third sentence addressed the time of the report, so it was impossible that Dr Nugawela could have known that the support was absent, the argument would preclude an imputation of objective falsity as well as an imputation of knowledge of falsity: see the third argument. But this assumed that the initial support was withdrawn only after and because of the presentation of the report to IMIA. That is not necessarily so. The second sentence referred to the position current at the time of the letter and said nothing as to the position in 1989.

The third argument in relation to imputations (b) and (d) took up the same point concerning the second sentence of para 4 of the letter, it being said that objective falsity could not be found in the letter because it appeared from the second sentence that the College supported AMIA. There is no reason to restrict imputations (b) and (d) to objective falsity, but even if they be so restricted what I have just said answers the argument.

The appellants' convolutions in attributing to Dr Nugawela different notions of falsity for the purposes of its arguments need no emphasis. More widely, the arguments required a technicality of approach which might delight a lawyer intent on word-games but, with respect, should have no part when the question is what the ordinary reasonable reader could understand from the letter. Even on that approach, they should not be accepted.

The second question came down to whether two aspects of the matters on which Dr Nugawela was permitted to rely in relation to aggravated damages, namely an intent to hinder and prevent the establishment of AMIA (MFI 32 para 6.3) and an intent to promote the formation and development of opposition health informatics associations (MFI 32 para 6.4), could be part of an improper motive. The principle to which the appellants appealed was that regard could not be had to their conduct which was not merely bona fide but was justifiable or proper: Triggell v Pheeney [1951] HCA 23; (1951) 82 CLR 497 at 514. The argument was that the objectives in paras 6.3 and 6.4 were legitimate, their pursuit by the publication of defamatory matter did not make them illegitimate, and so the relevant intents could not be taken into account in relation to aggravated damages. It was said that the particular vice in the matters objected to was that the conduct of persons other than Dr Crampton, persons put forward as co-conspirators in a plot to promote rival health informatics associations over AMIA, could be held against Dr Crampton and the College, contrary to the guidance in relation to conspiracy to injure to be found in McKernan v Fraser [1931] HCA 54; (1931) 46 CLR 343 at 398-401.

The short answer to the argument is that the intents did not stand alone, but were asserted in MFI 32 as aspects of an overall intention to injure Dr Nugawela other aspects of which were injury to his standing in the medical informatics field and promotion of the standing of Dr Crampton in that field, the overall intention to injure being put forward as an improper motive on the part of the appellants. It was open to the jury to view all aspects as unjustifiable or improper, as to the aspects presently in question at the least in association with the injury to Dr Nugawela's standing in the medical informatics field and promotion of the standing of Dr Crampton in that field but also as aspects of the overall intention. Regard could be had to the conduct of the other persons so far as it elucidated the motive and intention of the appellants, and there was no complaint in relation to any direction given or not given to the jury in that regard. I do not think that there was error in the trial judge's ruling whereby the matters in paras 6.3 and 6.4 of MFI 32 were permitted to go to the jury.

The third question was whether the damages of $600,000 were appealably excessive.

The appellants acknowledged that it was necessary to adopt the most favourable view of the evidence legitimately available for acceptance by the jury in support of Dr Nugawela's case, and that Dr Nugawela's case must be taken at its highest pitch; they also recognised the trial judge's description of that case on malice as "overwhelming". They said that even though the jury was entitled to take the view that there was deep hurt to Dr Nugawela's feelings, real injury to his reputation, and abundant evidence of malice, and the loss of what they described as "a chance of earning a modest income for part-time work as a consultant, speaker and writer in the field of medical informatics", the damages were manifestly excessive. They compared the damages with those found to be excessive in Carson v John Fairfax & Sons Ltd [1993] HCA 31; (1991) 24 NSWLR 256; (1993) 178 CLR 44 and more recently in Nationwide News Pty Ltd v Hartley (CA, 3 April 1996, unreported), and emphasised that in the former of these cases the High Court observed ((1993) [1993] HCA 31; 178 CLR 44 at 58-9) that it was necessary to maintain an appropriate relationship between the scale of values in cases of defamation and cases of serious physical injury.

A feature of the present case was that it included a claim for special damage and that the claim was left to be assessed by the jury on a modest amount of rather imprecise evidence. Another feature of the present case was that, notwithstanding the encouragement from the High Court in Carson v John Fairfax & Sons Ltd, the trial judge was not asked to provide to the jury an indication of the ordinary level of the general damages component of personal injury awards for comparative purposes, nor did counsel seek to provide such an indication. No complaint was made in this appeal of the trial judge's summing up. This did not make it any easier for the appellants to establish that the verdict was such that no reasonable body of men could have awarded it: Triggell v Pheeney at 516; Carson v John Fairfax & Sons Ltd at 61.

The claim for special damage was for loss of the opportunity to earn income by speaking engagements, consultancy work, and commercial literary work in and in connection with medical informatics. The jury was entitled to consider that Dr Nugawela had energy and ability, worked hard and was a central figure in medical informatics in and beyond Australia, and was able to combine his general practice with substantial activities in that field. He had a significant track record, was aged in his forties, and the jury could have concluded that, but for the wrong done to him, he would have had a long, successful and rewarding career in medical informatics. As Mahoney ACJ has said, the rate of earnings which he could have achieved was not clear, and in this respect in particular the evidence was imprecise but included reference to rates around $100 per hour and $1,000 to $1,500 per day. Even allowing for expenses and for earnings as a general practitioner foregone by devotion to medical informatics, as to which the evidence was again imprecise, on the approach of taking Dr Nugawela's case at its highest pitch the jury could have valued his lost opportunity at hundreds of thousands of dollars. As an example, and I stress that it is no more than speculation of the kind put before the Court as mentioned by Mahoney ACJ, the jury could have concluded that Dr Nugawela would devote an hour per day to medical informatics in addition to his general practice, at a net rate of $90 per hour, for twenty years. Loss for the five years up to judgment of the order of $112,500 and the fifteen years after judgment, discounted at 3 per cent, of the order of $285,000, both reduced by 30 per cent for contingencies would give a figure of the order of $278,000. The jury may not have reasoned in this way, but they could by a more intuitive process conformable to the evidence have arrived at a similar or larger figure.

Mahoney ACJ has discussed the principal elements of loss for which general damages are awarded, namely personal distress, damage to character and reputation, and vindication. His Honour has adverted to the similarity between damages in cases of defamation and damages in cases of personal injury in that both are essentially normative (neither a damaged reputation nor a lost limb has an objective value, and the value is that which is placed upon them by the judge or jury called upon to assess general damages), and to the difference between damages in those two cases in that, while both are said to be compensatory, there are differences in that for which each compensates. Maintaining an appropriate relationship between the scale of values in the two classes of case, as is required by Carson v John Fairfax & Sons Ltd (see also in England John v MGN Ltd [1995] EWCA Civ 23; (1996) 2 All ER 35) is itself a normative exercise. Maintaining an appropriate relationship does not impose a strait-jacket, but permits recognition of the importance, where necessary, of vindication of a seriously damaged reputation.

I do not repeat the matters canvassed by Mahoney ACJ in coming to his conclusions that the jury could have concluded that the hurt which Dr Nugawela felt was substantial, was renewed, and was continued until the end of the trial; that what the appellants did caused substantial and lasting damage to Dr Nugawela's personal and professional reputation (in particular in the field of medical informatics); and that vindication was important and called for substantial compensation. Again, in my opinion it was open to the jury to arrive at general damages of hundreds of thousands of dollars, conformably with Carson v John Fairfax & Sons Ltd. It might be added that, accepting an appellate court should correct a jury's excesses, it would be odd if the appellate court should intervene when the jury had not in the normative exercise adhered to a relationship, described only as "an appropriate relationship" without any other guidance, when the jury was not told of the need to keep such relationship or anything about damages in personal injury cases with which it was meant to maintain the relationship. It may be that Carson v John Fairfax & Sons Ltd has created a need for the indication to the jury to which it referred.

The damages in the present case were an undifferentiated sum of compensation for the lost opportunity to earn income and as solatium for distress, damage to reputation and vindication of the reputation. Considering what was open to the jury in relation to the various elements of the undifferentiated sum, in my opinion the damages of $600,000 were not appealably excessive.

Crampton v Nugawela [1996] NSWSC 651

At a glance

Court

Decision date

Before

Source

Judgment (196 paragraphs)

Crampton v Nugawela [1996] NSWSC 651 (23 December 1996)

Parties

Cases Cited (22)