Duma v Fairfax Media Publications Pty Limited

1. The documents in categories B and C of the respondents' schedule of documents for tender, and documents RTB 193, 247, 248, 249, 250, 355, 346, 386 and 445 in category A, be admitted into evidence.
2. The question of whether an order should be made limiting the use to which those documents should be put is reserved. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

KATZMANN J: 1 This is an action in defamation arising out of the publication of a series of articles in The Australian Financial Review (AFR). The action is brought against the publisher and the journalists who wrote the articles. Broadly speaking, the pleaded imputations are that the applicant, William Duma, a Minister in the Government of Papua New Guinea (PNG), is corrupt. It is sufficient for present purposes to refer to the imputations pleaded in relation to the first article. They are that: (a) as the Minister for Petroleum in PNG, Mr Duma acted corruptly by granting a 10% interest in a lucrative petroleum licence to Elevala Energy Ltd (Elevala), a shell company owned and controlled by Simon Ketan, a man said to be his close associate; (b) in that capacity he accepted a bribe from Horizon Oil, an ASX-listed company; (c) he conspired with Mr Ketan to use Elevala as a vehicle for the payment of bribes to him (Mr Duma); (d) he conspired with Mr Ketan to defraud tribal landowners of compensation; (e) as the Minister for Petroleum in PNG, he acted corruptly in 2017 in relation to his efforts to move a naval base 10 kilometres inland. 2 The respondents deny that the imputations arise. The only substantive defence they pleaded was the statutory defence of qualified privilege in the Uniform Defamation Laws: see Defamation Act 2005 (NSW), s 30. As Lee J observed in Nationwide News Pty Ltd v Rush [2018] FCAFC 70 at [9], "the purpose of statutory qualified privilege is to afford a defence when truth is not an answer and yet a publisher acts reasonably" (original emphasis). 3 At the conclusion of the oral evidence the respondents tendered hundreds of documents, only some of which had been used to question witnesses, either in chief or in cross-examination. All were part of a trove of documents taken from an email archive of the then Chief Executive Officer of Horizon, Brent Emmett. In particular, they were taken from a folder within that archive entitled "PNG", which contained more than 5,000 emails. One of the journalists, Angus Grigg, testified that he read through all of the first tranche of documents he received, which I infer was likely to be a subset of the documents in the PNG folder, a taster if you like. When asked how long he spent reading through the emails in the PNG folder, he replied that he spent some 50 to 60 hours "looking through" the inbox. 4 The respondents provided a schedule of documents for tender which was divided into four categories. The first category (A) consisted of documents used in the cross-examination of Mr Duma, the second and third (B) and (C) were documents to which the two journalists were taken or to which they referred in their evidence. The fourth (D) consisted of other documents, to which the journalists did not refer in their evidence and upon which Mr Duma was not cross-examined. Indeed, no reference was made to any of the documents in the fourth category at any point in the hearing. Their only purpose, as I understood the respondents' argument, was to advance the notion that the imputations were substantially true, or to provide "factual background" to the articles. 5 Objection was taken to the documents on a number of bases. 6 First, Mr Duma submitted that the documents should not be admitted because they were obtained in consequence of an impropriety, if not a contravention of Australian law. Documents of that kind must not to be admitted unless the desirability of admitting the evidence outweighs the undesirability of admitting the evidence: Evidence Act 1995 (Cth), s 138. Alternatively, Mr Duma submitted that the documents should be excluded under s 135 of the Evidence Act because their probative value was substantially outweighed by their prejudicial effect. 7 Second, Mr Duma submitted that, in any event, unless the journalists had read the documents and drew upon them when writing the articles, in which case they would be relevant to their qualified privilege defence, they are irrelevant. 8 With respect to category (A), to the extent that the journalists did not refer to the documents the respondents initially conceded that they were not relevant to the defence of qualified privilege. But they argued that they related to their defence that certain matters of fact should be taken into account in mitigation of damages. They also argued that the documents were relevant to rebut Mr Duma's plea that the hurt to his feelings was aggravated by his knowledge that the imputations were false. 9 I indicated that I was prepared to proceed on the basis that the documents were relevant by which I meant that they could rationally affect indirectly, if not directly, the assessment of the probability of the existence of a fact in issue: Evidence Act, s 55(1). 10 After hearing argument over the course of the morning of 11 October 2021, I adjourned the hearing until the following day so that I could consider the matter carefully. The next morning I informed the parties that I had decided to admit a number of the documents but not all of them. I gave very brief reasons at the time and indicated I would give more fulsome reasons as soon as practicable. These are those reasons. 11 Section 138 of the Evidence Act relevantly provides: Discretion to exclude improperly or illegally obtained evidence (1) Evidence that was obtained: (a) improperly or in contravention of an Australian law; or (b) in consequence of an impropriety or a contravention of an Australian law; is not to be admitted unless the desirability of admitting the evidence outweighs the undesirability of admitting evidence that has been obtained in the way in which the evidence was obtained. (2) … (3) Without limiting the matters that the court may take into account under subsection (1), it is to take into account: (a) the probative value of the evidence; and (b) the importance of the evidence in the proceeding; and (c) the nature of the relevant offence … and the nature of the subject-matter of the proceeding; and (d) the gravity of the impropriety or contravention; and (e) whether the impropriety or contravention was deliberate or reckless; and (f) whether the impropriety or contravention was contrary to or inconsistent with a right of a person recognised by the International Covenant on Civil and Political Rights; and (g) whether any other proceeding (whether or not in a court) has been or is likely to be taken in relation to the impropriety or contravention; and (h) the difficulty (if any) of obtaining the evidence without impropriety or contravention of an Australia law. 12 "Probative value" is defined in the Evidence Act to mean "the extent to which the evidence could rationally affect the assessment of the probability of the existence of a fact in issue". As Gaudron J observed in Adam v The Queen (2001) 207 CLR 96 at [59], that definition "echoes the substance of [the definition of relevant evidence]" in s 55(1). In effect, the probative value of evidence is the weight that might be attached to it. 13 The respondents submitted that s 138 does not apply since there is no assertion that either of the journalists engaged in impropriety as a recipient of the documents or was privy to any impropriety or breached the journalistic code of ethics. They also submitted that the applicant had failed to identify any crime under Australian (or PNG) law that might have been committed. But neither of these things matters. Section 138 does not only exclude evidence that was obtained improperly or in contravention of an Australian law. It also excludes evidence obtained in consequence of an impropriety or a contravention of an Australian law. The applicant relied on the second limb of the section, not the first. 14 As French CJ observed in Parker v Comptroller-General of Customs [2009] HCA 7; 83 ALJR 494; 252 ALR 619; 71 ATR 23 at [26], there is no definition in the Evidence Act of "impropriety" or, for that matter, "contravention". His Honour pointed out at [29] that the ordinary meaning of "improper" includes "abnormal" and "irregular". 15 Mr Duma carried the burden of establishing that the evidence was obtained in consequence of an impropriety or a contravention of Australian law. If he discharged that burden, the burden shifted to the respondents to prove the facts that weigh in favour of admission and persuade the Court that the desirability of admitting the evidence outweighs the undesirability of admitting evidence obtained in the way in which the evidence was obtained: Parker at [28] (French CJ). In both respects the burden is a legal one, to be satisfied to the civil standard of proof: Camm v Linke Nominees Pty Ltd (No 3) [2012] FCA 1133 at [6] (Tracey J). 16 I was satisfied that Mr Duma had discharged his burden. 17 The documents in question were passed to the journalists by a person whose identity they refused to reveal and who would only provide the documents on the condition that his or her identity was kept secret. The evidence disclosed that the source was a Horizon employee, but no more. It is common ground that the documents were obtained without the permission of Horizon or the CEO from whose email inbox they were obtained. One of the journalists, Jemima Whyte, testified that the confidential source (referred to as "CS-2") probably had no authority or permission to take them (T1004/25-27). And there is no evidence to suggest otherwise. In those circumstances, I concluded that it is more probable than not that the documents were obtained as a consequence of an impropriety, if not a contravention of Australian law. They were removed from the email archive without the authority or permission of their owner or custodian. Even if the evidence fell short of proving that they were stolen, at the very least their removal was irregular: compare Camm at [10]. 18 The respondents submitted that any allegation of impropriety by a "whistleblower" requires careful analysis of a number of matters which the applicant failed to undertake. Those matters were the statutory protections in the Corporations Act 2001 (Cth); the policy of the Australian Securities and Investments Commission (ASIC) which specifically encourages corporate whistleblowers to "call out misconduct" in Australian public companies; and the whistleblower policy that Horizon, as a public company, has been required to have since 1 July 2019. It seems to me that there is an onus on the respondents to adduce or at least point to evidence of these matters. Yet, while there was evidence before the Court that CS-2 was a former Horizon employee, there was no evidence of any of these matters. If there is an ASIC policy, it was not tendered. Nor was any policy Horizon might have had. And the statutory provisions to which the respondents referred do not apply to all people who take documents without authority or permission and leak it to the media. 19 Section 1317AAE (read with 1317AA) provides that it is an offence for a person to disclose the identity of, or information that is likely to lead to the identification of, an "eligible whistleblower". Section 1317AC prohibits victimisation of eligible whistleblowers. Section 1317AD provides that a court may make an order under s 1317AE if a person engages in "detrimental conduct" towards a whistleblower, including orders for compensation, an injunction or an apology. Section 1317AI requires public companies to have a whistleblower protection policy and make it available to its officers and employees. 20 Section 1317AAA defines the criteria for eligibility. It provides that the whistleblower must be, or have previously been, an officer or employee of a regulated entity, which includes a company (s 1317AAB). Section 1317AAD, however, provides that disclosures made to journalists on public interest grounds only qualify for protection in certain circumstances. These circumstances include where the whistleblower has previously made a disclosure of that information under s 1317AA (either internally at the regulated entity or to ASIC, the Australian Prudential Regulation Authority or a prescribed Commonwealth authority), and that after 90 days, the whistleblower reasonably believes that action has not been taken to address the matters to which the disclosure related, and that further disclosure to a journalist would be in the public interest. The whistleblower must also give notice of their intention to make the disclosure to the body to which the previous disclosure was made (s 1317AAD(1)(e)), and the extent of the information disclosed must be "no greater than is necessary to inform the recipient…of the misconduct or improper state of affairs or circumstances referred to in subsection 1317AA(4)" (s 1317AAD(1)(g)). There was no evidence to indicate that any of these circumstances applied in the present case. 21 The next issue was whether the respondents had proved the facts that weigh in favour of admission and had persuaded the Court that the desirability of admitting the evidence outweighs the undesirability of admitting evidence obtained in the way in which the evidence was obtained. 22 The first matter to note is the question of policy underpinning s 138. Contrary to Mr Duma's submission, Director of Public Prosecutions v Marijancevic (2011) 33 VR 440 at [17] is not authority for the proposition that "substantial weight must be given to the fact that [the evidence] was obtained unlawfully or improperly" (emphasis added). Rather, the Victorian Court of Appeal referred to according "appropriate weight" at [17]: The qualified proscription in s 138(1) that the evidence "is not to be admitted unless" indicates the importance of according appropriate weight to the effect of any impropriety or unlawfulness. 23 What weight will be appropriate in any given case is likely to depend on a variety of factors including the extent or degree of the impropriety or unlawfulness and the position or role of the person who behaved improperly or illegally. 24 Second, despite the heading to the section, which does not appear in the Evidence Act 1995 (NSW), the Evidence Act 2008 (Vic), the Evidence Act 2011 (ACT) or the Evidence (National Uniform Legislation) Act 2011 (NT), s 138 does not repose in a court a discretion to exclude improperly or illegally obtained evidence. To the extent that there is any discretion it is to admit evidence of this kind, not to exclude it. In truth, however, there is no discretion. Rather, what the section does is require a court to make an evaluative judgment after balancing the considerations which weigh in favour of admitting the evidence against those which weigh in favour of exclusion. The evaluative judgment is that the desirability of admitting the evidence outweighs the undesirability of the evidence obtained improperly or unlawfully or as a result of an impropriety or illegality. 25 The High Court pointed out in Kadir v the Queen (2020) 267 CLR 109 at [11] (footnotes omitted) that: Section 138 is modelled on cl 119 of the draft Bill proposed by the Australian Law Reform Commission ("the ALRC") in its final report on the law of evidence ("the Final Report"). With one alteration, cl 119 mirrors cl 116 of the draft Bill appended to the ALRC's interim report ("the Interim Report"). The ALRC proposed that the admissibility of improperly or illegally obtained evidence should be governed by a modified form of the common law exclusionary public policy discretion articulated in Bunning v Cross. The two modifications that the ALRC proposed were to place the onus on the tendering party to justify admission and to clearly articulate the factors informing the competing public interests. 26 The High Court also pointed out in Kadir (at [12]-[13]) that s 138 goes further than what the ALRC proposed by extending the exclusion beyond evidence which is improperly or illegally obtained by police and other law enforcement agencies and is not confined to criminal proceedings. The undesirability of admitting such evidence, the High Court observed, recognises the public interest in not giving curial approval or encouragement to illegally or improperly obtained evidence. The High Court noted that, in providing for the admission of evidence notwithstanding the means by which the evidence was obtained, the reference in the section to the desirability of admitting the evidence recognises the public interest in all relevant evidence being placed before the tribunal of fact. These are the matters which must now be addressed. 27 The respondents submitted that: In support of our mitigation of damages plea in our defence and in answer to the applicant's own pleaded case that he knew that the imputations were false, these documents are relevant to each of those questions and are, one way or the other, probative. They have a high probative value in determining whether or not the applicant's contention that what was said about him was false and that in reality, according to his evidence, he acted not unilaterally but on the recommendations of the [Petroleum Advisory Board]. These documents will be relevant to that consideration. And to exclude them would be to exclude part of the picture. I pause for a moment and say the applicant has sought to advance, as your Honour will see from the applicant's own submissions, the chronology of events that identifies what happened between about June 2010 and March 2011. And they have given - the applicant has given a complexion to that sequence of events and has isolated events. And I don't say that critically. They're entitled to do that. What each of these documents do is provide further context for whether or not that chronology of events is true or false. For your Honour to exclude these documents, your Honour would be accepting the applicant's version and chronology without contradiction, without the ability for either the respondents to contradict that or, indeed, the ability for the court to analyse the correctness of what they put… (Emphasis added.) 28 There were several difficulties with the respondents' submissions. 29 First, while it is true that Mr Duma challenged the chronology of events given by the journalists in the articles, both the journalists admitted in cross-examination that their chronology was false. It was not apparent in these circumstances how the tender of the documents in question could assist the respondents. 30 Second, while it is also true that that Mr Duma pleaded that he knew the imputations to be false, the respondents did not deny that plea or raise a defence of justification or contextual truth. The truth of the imputations was not raised anywhere in the defence or identified as an issue in the parties' agreed statement of facts and issues. Nor did the respondents put to Mr Duma in cross-examination that his plea was dishonest. He therefore had no notice that his plea was in dispute. 31 Third, and in any case, Mr Duma's plea amounted to a statement of his belief; it was a reflection of his state of mind, not the objective truth. As Hunt J observed in Makim v John Fairfax & Sons Ltd (unreported, Supreme Court of New South Wales, 15 June 1990), "[a] person's belief in the truth of a particular fact is not established by showing that objectively the fact is true". Equally, a person's belief that a particular fact is false is not undermined by proving it is true. 32 The respondents also relied on statements by Allsop CJ and Rares J in separate judgments in Nationwide News Pty Limited v Rush [2018] FCAFC 70 concerning the relevance of objective truth to a defence of statutory qualified privilege. 33 The point made there was, as the Chief Justice put it at [18]: What can be identified as a relevant circumstance for the purposes of s 30(3) of the Defamation Act 2005 (NSW) is a question of the meaning and application of the statute and the particular circumstances in the context of the alleged defamation. I would eschew a process of creation of a priori rules that might encrust the statute unnecessarily. The primary judge himself recognised this very point. He said at [137]: It may perhaps be doubted, however, that Hunt J intended to lay down a concrete rule that the objective truth of the published statements can never be relevant to the reasonableness of the publisher's conduct in publishing, and can never be relevant to any issue that may arise in the context of the defence of qualified privilege. 34 In the present case, however, the objective truth of the published statements does not arise on the respondents' pleading. The respondents did not allege that their conduct was reasonable because the imputations were true or substantially true. The only reference to the truth in their defence is in para 25(e) where they say that "the respondents believed the matters set out in the matters complained of to be true". As it happens, Mr Grigg testified in cross-examination that he did not believe any of the imputations to be true and Ms Whyte testified that not only did she did not believe the imputations to be true but that she believed them to be false. 35 As I have already observed, the respondents also argued that the documents were relevant to their plea in mitigation of damages. They relied on the judgment in Burstein v Times Newspapers Ltd [2000] EWCA Civ 338; [2001] 1 WLR 579; [2000] All ER (D) 2384. Burstein is authority for the proposition that in an action for defamation it is open to a defendant to rely on facts which form part of the "directly relevant background context" to the defamatory publication even if no defence of justification is pleaded: see, especially, Burstein at [42], [47] (May LJ); Warren v Random House Group Ltd [2007] All ER (D) 67; [2008] 2 WLR 1033; [2009] QB 600 (CA) at [78]. But the Court held that evidence of directly relevant background context may only be admitted if it can be characterised as evidence of the claimant's reputation: Burstein at [42] (May LJ). 36 It is trite to observe that to be relevant to mitigation of damages the relevant evidence, if accepted, must be capable of rationally affecting, directly or indirectly, the assessment of the probability of the existence of a fact in issue. Mr Duma's claim is confined to damages for the injury to his reputation and hurt feelings. The issue to which the respondents say the contentious evidence relates is Mr Duma's reputation. Although the term "character" is often used interchangeably with reputation, particularly in the older authorities, it is important to recognise that there is a difference between reputation and character. As Lord Denning observed in Plato Films Ltd v Speidel [1961] AC 1090 at 1138: A man's "character", it is sometimes said, is what he in fact is, whereas his "reputation" is what other people think he is. If this be the sense in which you are using the words, then a libel action is concerned only with a man's reputation, that is, with what people think of him: and it is for damage to his reputation, that is, to his esteem in the eyes of others, that he can sue, and not for damage to his own personality or disposition. (Emphasis in original.) 37 In Rush v Nationwide News Pty Ltd (No 2) [2018] FCA 550; 359 ALR 564 at [32]-[45], Wigney J analysed the nature of the Burstein principle and discussed the difficulties in applying it. His Honour concluded at [45] that the facts which are able to be pleaded and proved in mitigation of damages in accordance with Burstein "must concern specific conduct [that is to say, specific conduct on the part of the claimant] that is directly relevant to either the subject matter of the alleged defamatory statement, or the claimant's reputation in the part of his or her life the subject of the defamatory publication". His Honour said that it was clear that courts must proceed with caution in applying Burstein and should guard against too creative an extension of the concept of "directly relevant background", and should subject the proposal to adduce facts under the Burstein principle to careful scrutiny. I respectfully agree. 38 In Plato Films, the correctness of which was not questioned in Burstein, the House of Lords dismissed an appeal from orders striking out one subparagraph of the defence and granting leave to amend another. The House of Lords held that evidence of particular acts of misconduct on the plaintiff's part could not be given in mitigation of damages where the defendants had failed to justify the defamatory publication (at 1123, 1139, 1147). 39 The action was brought by Hans Speidel, who at the relevant time was the Supreme Commander of Allied Land Forces in Central Europe. He claimed that he had been defamed in a film which depicted him as being a party to the murders of the King of Yugoslavia and the French Foreign Minister and as having betrayed Field-Marshal Rommel in 1944. The defendants admitted he had been depicted in this way but pleaded that the depiction was true in fact and substance. They also relied on particular acts of misconduct in mitigation of damages. It is useful to compare the pleading that was rejected and that which was accepted with the pleading in the present case. 40 The opening words of para 5 of the defence in Plato Films were: Alternatively in mitigation of damages the defendants will at the trial of this action give evidence in chief as to the circumstances under which the alleged libel was published and as to the character of the plaintiff. 41 Subparagraph (A), which was struck out, was entitled: "particulars of circumstances under which the alleged liable was published". It recited: The photographic pictures and words of which the plaintiff complains were published and exhibited as part of the film wherein the plaintiff was further depicted as having been guilty of the conduct hereinafter set out the truth of which the plaintiff in his amended statement of claim does not deny; namely, that he: (a) while chief of staff to the military commander in occupied France between about September, 1940, until about May, 1942, was party to and/or responsible for acts which were war crimes and/or against humanity and/or atrocities namely: (i) The taking and/or shooting of civilians or others as hostages; (ii) the deportation and/or removal to concentration camps and/or to the east of Jewish and other persons; (iii) the execution in occupied France of the decrees whereunder the aforesaid and similar acts were carried out…[the parts of the film were specified]. (b) While Chief of General Staff to German army groups during the retreat of the German armies in the U.S.S.R. was party to and/or responsible for acts generally accepted among civilised peoples as being contrary to the rules of warfare and/or wanton destruction of property and/or of terrorisation…[The parts of the film were again specified.] (c) While being a military attaché on the staff of or attached to the German Embassy in Paris between in or about the period between 1934 and 1938 (inclusive) engaged in espionage on behalf of Nazi Germany in preparation for the invasion of France ... [The relevant passages in the film were specified.] (d) While being a military attaché on the staff of or attached to the German Embassy in Madrid in and about 1939, engaged in espionage on behalf of Nazi Germany against France, Great Britain and North Africa ... [The relevant passages were specified]. 42 Sub paragraph (B) was entitled "particulars of the matters relating to the character of the plaintiff". It read: The plaintiff is widely reputed to have been and in fact was: (i) guilty of the conduct alleged against him in the said film as set out in paragraphs 3, 4 and 5 (A) hereof; (ii) while chief of staff to the military commander in occupied France between the aforesaid dates: (a) concerned in enforcing and carrying out the General Staff and other orders relating to the taking, selection, arrest, detention, execution and deportation of hostages: (b) concerned in developing, directing and enforcing Nazi anti-Jewish policy in occupied France; (iii) since 1926 an advocate of and believer in the suppression of German democratic political life. 43 The Court of Appeal gave leave to amend subpara (B) to read: Alternatively in mitigation of damages the defendant will at the trial of this action give evidence in chief that the plaintiff had on or before November 19, 1958, a bad reputation as a man who was a party to and/or responsible for acts which were war crimes and/or against humanity and/or atrocities. 44 The relevant part of the mitigation of damages plea in the present case is contained in of the defence. It reads: If, which is denied, the applicant is found to be entitled to any damages as a result of the publication of any of the matters complained of and/or any of the imputations, the respondents will rely in mitigation of damages upon the following facts and matters: … (d) the facts, matters and circumstances proven in evidence in support of the defences pleaded in this defence, which the respondents anticipate will include the following: (i) On 15 February 2000, Petroleum Retention Licence No. 5 (PRL 5) was granted for a period of 5 years to Santos and its joint venture partners in relation to the Elevala and Ketu gas fields in the Western Province of PNG. (ii) On 15 February 2005, PRL 5 was extended for a further 5-year period. (iii) On 5 August 2009, the then-current licensees of PRL 5, Santos, Horizon and Talisman (JV Parties), lodged an application for a further extension of PRL 5 for 5 years. (iv) On 7 February 2010, Horizon's CEO, Brent Emmett, sent an email to Alan Fernie, Horizon's Manager Exploration & Development, and Sheridan, stating, "I hesitate to put this in an email but it smells like someone is setting the scene for a handout to solve a problem that doesn't exist". (v) On 28 June 2010, the applicant, in his capacity as Minister for Petroleum and Energy, issued a Notice of Intention to Refuse to extend PRL 5 for the JV Parties. (vi) On 5 November 2010, the applicant refused to grant an extension of PRL 5 for the JV Parties. (vii) On 19 November 2010, the applicant notified stakeholders, including Horizon and Talisman, of the availability for tender, from 22 November 2010 until 26 November 2010, of the blocks formerly covered by PRL 5. (viii) On 23 November 2010, Horizon's CEO, Brent Emmett wrote to the applicant in relation to its application for an extension of PRL 5, stating, inter alia, that Horizon remained "open to any suggestion from [the applicant] as to how the current tension might be diffused". (ix) On 3 December 2010, Horizon sought leave of the National Court of PNG to commence proceedings for judicial review in respect of the applicant's refusal to extend the term of PRL 5. (x) On 13 December 2010, the National Court refused leave for Horizon to commence judicial review proceedings. (xi) on 16 December 2010, Horizon filed an appeal in the PNG Supreme Court of Justice in relation to the National Court's refusal to grant leave to commence proceedings (Appeal Proceedings) and was granted temporary orders on 20 December 2010, restraining any dealings in respect of the blocks covered by PRL 5. (xii) On 21 December 2010, Horizon CFO, Michael Sheridan, sent an email to lawyer Ian Shephard of Blake Dawson (now Ashurst) in PNG, which stated, inter alia, "Duma accepts that that we would wish to continue to pursue the judicial review until such time as we have been awarded the PRL under satisfactory arrangements." (xiii) On 3 February 2011, lawyer Tim Glenn of Blake Dawson (now Ashurst) in PNG sent a confidential email to Michael Sheridan, stating, inter alia, 'The bad guys want 30%!!! "Tell em they're dreamin"'. (xiv) On 4 February 2011, the applicant provided Horizon with short minutes of proposed consent orders effecting settlement of the Appeal Proceedings, and providing, inter alia, that a licence in respect of the blocks covered by PRL 5 be granted to Horizon (70%), Dabajodi International Energy Ltd (20%) and Elevala (10%). (xv) On 7 March 2011, Horizon and the applicant entered into a settlement deed pursuant to which Horizon agreed to discontinue the Appeal Proceedings in return for the granting of a licence in respect of the blocks covered by PRL 5 to Horizon, Dabajodi International Energy Ltd and Elevala in the shares set out above. (xvi) On 11 March 2011, the PNG Supreme Court of Justice made orders by consent, dissolving the temporary restraining order of 20 December 2010, and providing for the grant by the applicant, in his absolute discretion, of a licence in respect of the blocks covered by PRL 5 to Horizon, Dabajodi International Energy Ltd and Elevala in the shares set out above. (xvii) On 14 March 2011, Simon Ketan was appointed as the sole director of Elevala. (xviii) On 18 March 2011, Petroleum Retention Licence 21 (PRL 21) was granted to Horizon, Dabajodi International Energy Ltd and Elevala in the shares set out above. (xix) On 24 March 2011, Simon Ketan acquired two shares in Elevala, comprising the total share capital in Elevala; (xx) Elevala was a shell company with no relevant experience in relation to petroleum or oil mining. (xxi) Simon Ketan, the sole director and shareholder of Elevala at the time of the grant of PRL 21, acted for the applicant in relation to Papua New Guinea Supreme Court proceedings William Duma v Eric Meier & Neil Matheson as executors of the estate of Peter Goodenough (case no. SCA No. 36 of 2006). (xxii) The applicant, by his own admission, worked at the same law firm as Simon Ketan approximately 15 years ago. (xxiii) The applicant, by his own admission, came from the same province in PNG as Simon Ketan. (xxiv) On 31 March 2011, Horizon announced to the ASX that the Appeal Proceedings had been settled and that PRL 21 had been granted but did not refer to Elevala in the announcement. (xxv) On 28 April 2011, Horizon CEO, Brent Emmett, sent an email to the board of Horizon, recommending that Horizon pre-empt any other offers for Elevala's 10% share of PRL 21 by offering Elevala "ca US$10 million, split between the companies", and stating, "I recommend this as a good opportunity". (xxvi) On 6 May 2011, Amelia Jalleh, Talisman's Legal Manager - Australia/PNG, sent an email to Brent Anderson and Pat Colwell of Talisman, which included an excerpt from a news story reporting on charges of perjury brought against Simon Ketan on 2003 and comments in support of Mr Ketan by the applicant, stating, inter alia, "[i]s this sufficient, for FCPA [Foreign Corrupt Practices Act] purposes, for us not to proceed with acquiring an interest in PRL 21 from Elevala Energy, or would more definitive information be required?". (xxvii) On 7 May 2011, Brent Anderson of Talisman sent an email to Amelia Jalleh in relation to the results of due diligence searches conducted in relation to Simon Ketan, including charges brought against Mr Ketan in 2003 by the PNG Law Society in relation to allegations of misuse of the PNG National Provident Fund and charges of perjury. (xxviii) On 10 May 2011, Brent Emmett sent an email to Ian Angell, Head of Business Development at Talisman, stating "[w]e've had plenty of time to do our due diligence on what is a straight asset acquisition in which we already have an interest. I don't want to risk spooking the horses." (xxix) On 11 May 2011, Amelia Jalleh sent an email to Michael Sheridan, identifying Talisman's concerns with respect to the payment of US$10.3m to Elevala for its share of PRL21, relating to the identity of Elevala, including that Simon Ketan was not listed on the corporations register as being a director of Elevala despite purporting to act in that capacity, and that Talisman knew next to nothing about the listed shareholders of Elevala. (xxx) On 14 May 2011, Pat Colwell, Senior Legal Counsel Talisman Energy Inc, sent an email to Douglas Greenburg, lawyer at US firm Latham & Watkins, identifying "red flags" in respect of the proposed acquisition of Elevala's 10% share of PRL21, stating, inter alia, "If we assume that there was some corrupt behavior [sic] on the part of Elevala in the acquisition of their interest in PRL 21 it would either be the "fruit of the poisoned tree", which we have previously discussed, or the possibility of payments flowing from Elevala back to some government officials from the sale price to be paid by Talisman and Horizon". The email also stated, "one of the principals of Elevala is a lawyer with what appears to be close connections to government officials". (xxxi) On 15 May 2011, Douglas Greenburg of Latham & Watkins sent an email to Pat Colwell, stating, inter alia, "[t]he bottom line is that if DOJ or SEC get wind of an allegation from any source that Elevala was a vehicle for bribes or paid bribes, there likely will be an investigation. If that occurs, you need to be able to show you did due diligence and reasonably believed the transaction was not corrupt". The email continued, "keep in mind that if Elevala turns out to be a problem and Horizon buys out their interest, there can be questions about what Talisman knew about that. So, understanding the role of Elevala in all this is probably important, even if you decided to pass on buying them out". (xxxii) On 20 May 2011, Amelia Jalleh forwarded the results of news and other searches to Douglas Greenburg, including the excerpts from the news stories referred to at (xxvi) and (xxvii) above. (xxxiii) On 20 May 2011, consultant Arthur Jones sent an email to Amelia Jalleh, stating, "I am held up in a Board Meeting and have not had the pleasure of Simon Ketan's company yet. He has stood me up on two occasions -yesterday and today. Not really sinister but I will need to find him. There is no way around this as we need him". (xxxiv) On 23 May 2011, Michael Sheridan sent an email to Ian Angell of Talisman, stating, "[w]e understand that Simon Ketan is not inclined to complete the Talisman questionnaire". (xxxv) On 26 May 2011, Simon Ketan agreed to sign the Tracecheck due diligence questionnaire, subject to conditions that included that he would not be required to sign any additional documents relating to the purchase of Elevala's 10% share of PRL 21. (xxxvi) The questionnaire signed by Simon Ketan did not disclose any relationship between the applicant and Simon Ketan. (xxxvii) On 12 February 2020, Horizon announced to the Australian Stock Exchange that it had appointed Herbert Smith Freehills to conduct an investigation into the circumstances of the granting by the applicant of PRL 21, and that Michael Sheridan had been suspended as Horizon's CEO effective as at 12 February 2020. 45 Despite the reference to the pleaded "defences", as I have already mentioned there was only one defence to the publications: the defence of statutory qualified privilege. Notably, neither the defence of justification (s 25) nor contextual truth (s 26), both of which require a defendant to prove that one or more of the pleaded imputations are substantially true, was pleaded. 46 I have difficulty with the respondents' argument concerning the relevance of the evidence in question to the issue of mitigation. First, to the extent that they list facts, I struggle to understand how these facts, if proved, could have any effect on Mr Duma's reputation, let alone a direct effect. Second, the respondents did not plead that his reputation has been affected by these matters. Third, to the extent that the listed matters might reflect on anyone's reputation, it is not Mr Duma's, but Mr Ketan's and perhaps also Mr Sheridan's. Critically, the respondents did not plead that Mr Duma was aware that Elevala was a shell company, that Mr Duma had any contact with Mr Ketan over the issue of the licence, that Mr Duma failed to declare his "relationship" with Mr Ketan, or that he had had any meetings or discussions with Horizon representatives with respect to the licence. Based on the pleading, none of these matters was an issue in the proceeding. 47 Even if the documents were relevant and probative, as the respondents contended, and the evidence was important to their case, their refusal to identify their source necessarily affects their ability to discharge their burden of proof. While the respondents did not accept that there was an impropriety, they conceded that the actions of the source were deliberate. Without knowing the circumstances in which the documents came to be downloaded from the CEO's email account, however, it is impossible to assess the gravity of the impropriety (s 138(3)(d)) or whether any other proceeding has been or is likely to be taken in relation to it (s 138(3)(g)). 48 Further, the impropriety was inconsistent with, if not contrary to, a right of a person recognised by the International Covenant on Civil and Political Rights (ICCPR). Article 17 of the ICCPR relevantly states that: 1. No one shall be subjected to arbitrary or unlawful interference with his privacy … or correspondence, nor to unlawful attacks on his honour and reputation. 2. Everyone has the right to the protection of the law against such interference or attacks. 49 There is no evidence one way or another as to whether another proceeding has been or is likely to be taken in relation to the impropriety. 50 The respondents did not attempt to prove that it would be difficult to obtain the evidence but for the impropriety. They merely made the assertion. I accept that many of the documents contain confidential information. But even then, the respondents might have made inquiries and who knows where those inquiries might have led. 51 What is more, not only were the documents released to the journalists without the permission of either Mr Emmett or Horizon but, on the face of things, they were also released without the permission of the other parties to the confidential communications. Some of these documents would be protected by legal professional privilege. Yet no notice appears to have been given to any of the people who would be entitled to make such a claim. 52 On the other hand, to the extent that the journalists relied on the documents for their stories, they are undoubtedly relevant, of probative value, and of considerable importance to the respondents' only defence to the alleged defamatory publications. 53 The documents in categories (B) and (C) are documents of this nature. 54 The defence of qualified privilege serves an important public interest. In Stephens v Western Australia Newspapers (1994) 182 CLR 211 at 265 McHugh J said: [I]t is for "the common convenience and welfare" of Australian society that the existing categories of qualified privilege be extended to protect communications made to the general public by persons with special knowledge concerning the exercise of public functions or powers or the performance of their duties by public representatives or officials invested with those functions and powers. The scientist who discovers that lack of governmental action is threatening the environment, the "whistleblower" who observes the bureaucratic or ministerial "cover up", and the investigative journalist who finds that grants of public money have been distributed contrary to the public interest are examples of persons who have special knowledge of matters affecting the exercise of public functions or powers or the performance of duties by public representatives or officials. If such persons, acting honestly, inform the general public of what they know about such matters, their publications will be made on an occasion of qualified privilege … 55 Within category (A), too (the documents put to Mr Duma in cross-examination) are documents that I am satisfied Mr Grigg and/or Ms Whyte, read and relied upon for the stories featured in the articles. 56 The articles, for example, referred to meetings between Mr Duma and Mr Emmett, which Mr Duma denied had taken place. Both Ms Whyte and Mr Grigg were taken to some emails referring or alluding to such meetings but not these ones. I consider it likely, however, that they had them in mind when giving their evidence and in writing their articles. 57 There were other documents in this category which I consider the journalists also relied upon although they were not identified by number in the evidence. Mr Grigg gave the following evidence at T410 which touches upon some of them: [D]oing the best you can, when did you start to understand the story that you were going to ultimately write on 10 February?---When we came back from Christmas break, the second week of January, we probably had a pretty good idea what the story was. And what was that story at that stage?---Story we were looking at was focused on Horizon Oil and the payment it made to Elevala Energy which the document showed us was a 2 kina shell company which had been set up very recently or very prior to the transaction had been established, and that was the - that was the focus of the story. All right. And were there any particular - what did that timing, if anything, indicate to you at that time? What did the timing in relation to Elevala, if anything, indicate to you at the time?---It was curious to us that a company with no trading history, with no employees, with almost no paid in capital could be awarded such a lucrative licence that would then be required to embark on a very large amount of capital expenditure to exploit that licence, and the timing was also curious in that it was established just prior to the licence being awarded. And do you recall seeing any documents that addressed this concern or question that had arisen in your mind?---Yes. There was documents from the company's register in Papua New Guinea which showed the constitution of Elevala Energy, the directors and the shareholders of that company. And we might go to those now. Do you recall firstly - do you recall when Elevala was incorporated? Do you recalling seeing a document that indicated when Elevala was incorporated?---I do. Do you have a recollection of what date that was?---I don't have an exact recollection. No. 58 These documents could have been obtained without impropriety, however. They were public records. So, too, were a number of other documents, such as the records of the Petroleum Advisory Board. 59 On balance, taking into account all relevant matters, I came to the conclusion that the documents upon which the journalists relied should be admitted into evidence. Despite the countervailing considerations, I was satisfied that the probative value and importance of these documents to the respondents' sole defence meant that the desirability of admitting them outweighs the undesirability of excluding documents obtained in consequence of the impropriety. Those documents included some of the documents in the first category and all of the documents in the second and third categories but none of the documents in the fourth category. In the case of the documents that I decided should not be admitted, I was not persuaded that the desirability of admitting them outweighs the undesirability of excluding documents obtained in consequence of an impropriety. 60 The documents in category (A) I decided to admit into evidence were the following documents in the respondents' tender bundle (RTB): RTB 193 (the letter from Mr Duma to Santos and Horizon dated 30 July 2010 regarding the extension of Petroleum Retention Licence No 5); RTB 247 and 248 (the application for reservation of the company name and company registration of Viva No 54 Limited, later renamed Elevala Energy) as well as RTB 249 and 250 (the consents of the director and secretary of the proposed company). I also decided to admit RTB 355, which refers to "discussions with the minister" in December 2010, RTB 445 (an email entitled "Award of PRL 21" and attachments), upon which Mr Grigg was cross-examined and which he said he had seen during the course of preparing the first article (at T749). Finally, I decided to admit RTB 346 (an email entitled "PRL 5 Application Documents" and attachments) and RTB 386 (an email chain attaching a draft deed of settlement and release), to which Mr Grigg was also taken in cross-examination and upon which he apparently relied in preparing the articles (at T748 and T772 respectively). 61 I rejected Mr Duma's alternative submission that the documents should be excluded under s 135 of the Evidence Act. 62 Section 135 gives a court a general discretion to refuse to admit evidence if the probative value of the evidence is substantially outweighed by the danger that the evidence might be unfairly prejudicial to a party; misleading or confusing; or cause or result in undue waste of time. 63 Mr Duma contended that his inability to test how the documents came into the possession of the respondents was unfairly prejudicial to him. Evidence is not unfairly prejudicial merely because it is unfavourable to the person against whom it is tendered. As Sheller JA put it in Ordukaya v Hicks [2000] NSWCA 180 at [33]: The admission of a document of probative value against a party involves prejudice to that party. However it is not prejudice, but unfair prejudice, which must be weighed against the probative value of the representation. 64 Similarly, in the context of a criminal case, Gleeson CJ observed in Festa v The Queen (2001) 208 CLR 593 at [22], echoing the observations made by McHugh J in Papakosmas v The Queen (1999) 196 CLR 297 at [91]-[97]: [P]rejudice does not arise simply from the tendency of admissible evidence to inculpate an accused. It is unfair prejudice that is in question. Where evidence is relevant and of some probative value, prejudice might arise because of a danger that a jury may use the evidence in some manner that goes beyond the probative value it may properly be given. If there is relevant prejudice of that kind, it lies in the risk of improper use of the evidence, not in the inculpatory consequences of its proper use. If it were otherwise, probative value would itself be prejudice. All admissible evidence which supports a prosecution case is prejudicial to an accused in a colloquial sense; but that is not the sense in which the term is used in the context of admissibility. (Footnote omitted.) 65 In its Interim Report, the ALRC explained at [644]: By risk of unfair prejudice is meant the danger that the fact-finder may use the evidence to make a decision on an improper, perhaps emotional, basis, ie on a basis logically unconnected with the issues in the case. Thus evidence that appeals to the fact-finder's sympathies, arouses a sense of horror, provokes an instinct to punish, or triggers other mainsprings of human action may cause the fact-finder to base his decision on something other than the established propositions in the case. Similarly, on hearing the evidence the fact-finder may be satisfied with a lower degree of probability than would otherwise be required. See Australian Law Reform Commission, Evidence, Report No 26 (Interim) (1985). 66 Mr Duma did not identify a danger of this kind. The mere fact that a witness is unavailable for cross-examination is not enough although, this circumstance can affect the weight that should be attached to the document: see, for example, Harrington-Smith (on behalf of the Wongatha People) v Western Australia (No 8) [2004] FCA 338; 207 ALR 483 at [76], [111] (Lindgren J); see also Ordukaya v Hicks at [8] (Mason P). Of course, CS-2 was not a witness. It is theoretically possible that he was the author of some of the documents. Even then, that circumstance alone would not necessarily cause Mr Duma unfair prejudice. 67 In Ordukaya v Hicks (at [39]-[40]), however, Sheller JA, with whom Meagher JA agreed, accepted that the concept of "unfair prejudice" in s 135 could also arise where a document had been obtained "by unfair means". 68 Still, even if I were to accept Mr Duma's contention that he was unfairly prejudiced by his inability to test the means by which the documents came into the respondents' possession, it would not be enough to enable the Court to exclude the documents. The Court could only do so if the probative value of the evidence was substantially outweighed by the danger of unfair prejudice. In the absence of any argument on this critical question, I was not persuaded that the evidence should be excluded. 69 Mr Duma foreshadowed that, if any of the documents were admitted, he would seek an order under s 136 of the Evidence Act limiting the use to which they could be put. With the parties consent, I indicated that I would dispose of that application in my final judgment. I certify that the preceding sixty-nine (69) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Katzmann.