Gacic v John Fairfax Publications Pty Ltd [2009] NSWSC 1198 | Case summary

JUDGMENT - EX TEMPORE 1 HIS HONOUR: The plaintiffs sue the defendants for defamation seeking damages in respect of a publication concerning their restaurant Coco Rocco in the "Good Living" section of the Sydney Morning Herald on 30 September 2003. That publication was in the form of a review of the restaurant. The matters originally complained of were contained in that review and said to convey imputations defamatory of the plaintiffs including that the restaurant sold unpalatable food, charged excessive prices, employed a chef who made poor quality food and cognate complaints. 2 As far as I have been able to determine, these proceedings have at least the following relevant history. A s 7A hearing before Bell J and a jury of four was completed in 2004. The plaintiffs appealed to the Court of Appeal contending, among other things, that her Honour's summing up to the jury contained errors adversely affecting the jury's decision. That appeal was successful. The defendants then appealed to the High Court of Australia but so much of the decision of the Court of Appeal ordering another s 7A trial survived. That trial subsequently took place before Adams J and a jury of four. The imputations that were found by the jury on that occasion to be defamatory of the plaintiffs are the subject of the hearing that was due to commence before me this morning on issues of defences and damages. 3 When the proceedings were called on for hearing this morning Mr Evatt of counsel announced his appearance for the plaintiff with Mr Rasmussen and Mr Dibb. The first plaintiff immediately approached the bar table to indicate that she had earlier this morning terminated the retainer of her solicitors. In those circumstances Mr Evatt announced that he and his juniors were no longer properly instructed and sought leave to withdraw from the case. The first plaintiff thereafter made a series of submissions that in due course became an application for an adjournment to permit the plaintiffs to retain alternative solicitors to appear for them. 4 The basis of this application was to some considerable extent set forth in an affidavit sworn by the first plaintiff today, which the plaintiffs filed in court and which I read on the plaintiffs' application. The burden of that application is that the plaintiffs contend that their erstwhile solicitors had failed properly or in accordance with their instructions to prepare the case for hearing today and, it would seem, had either abandoned, or had permitted the discontinuance of, so much of the plaintiffs' claim as sought actual or special damages. Considerable reference is made in the first plaintiff's affidavit to the status of the plaintiffs' claim for financial loss and the availability or unavailability of documentary material and witnesses to establish such a case. 5 I am informed by Mr Blackburn of senior counsel who with Mr Sibtain of counsel appears for the defendants that the plaintiffs' claim for economic loss, originally appearing in the amended statement of claim filed as long ago as 8 November 2004, has never been particularised at any time since then. Mr Blackburn relied upon an affidavit of Diana Gillian Lawrance sworn 16 February 2009 in which Ms Lawrance deposed to what occurred at a directions hearing on 18 December 2008. Apparently on that occasion the plaintiffs, who were represented by junior counsel, informed the court that no claim for special damages would be made but that the plaintiffs intended to claim legal expenses, medical expenses and hospital expenses. Ms Lawrance said that whilst a claim for economic loss said to flow from the failure of the restaurant had been foreshadowed, the directions hearing on 18 December 2008 was the first occasion on which any claim for economic loss on any other basis had been raised. In those circumstances Registrar Bradford ordered the plaintiffs to provide full particulars of special damage by 21 January 2009. According to Ms Lawrance neither the plaintiffs nor their legal advisers provided any particulars of special damage prior to 9 February 2009 on which day the matter came back before Registrar Bradford for further directions. There was no appearance for the plaintiffs at that time. Ms Lawrance wrote to the plaintiffs on that day but says that she had received no response from the plaintiffs' solicitors concerning any outstanding particulars of special damage, which by the date that she swore her affidavit had not been provided. 6 Although as I have already indicated, the first plaintiff's affidavit makes wide ranging complaints against her former solicitors, a significant aspect of those complaints concerns what appears to be a dispute about the correct status of the plaintiffs' financial loss claim. The plaintiffs' claim that their case has not been properly prepared centres largely, though not exclusively, around that issue. 7 The first plaintiff concedes, if a concession were necessary, that she is not in a position to present the plaintiffs' case today. None of the plaintiffs has legal training. This, however, would appear to be considerably less significant than the fact that the plaintiffs do not, in the turbulent events of this morning, have access to or possession of the solicitor's file. Nor are the plaintiffs yet in a position to inform me whether or not that file can be obtained any time soon or whether or not the plaintiffs' former solicitors will impose as a condition of its production the requirement that the plaintiffs pay any outstanding legal costs that they owe or make some appropriate arrangements by way of undertaking or other security to guarantee payment. 8 The first plaintiff has informed me that the financial position of the plaintiffs is such that if an order were made granting an adjournment on their application, but imposing as a condition upon the further conduct of the proceedings a requirement that the plaintiffs pay the defendants' costs occasioned or thrown away as the result of an adjourned hearing, they would in all likelihood, if not certainly, never be able to proceed with their case. I note that in terms of the quantum of any costs that may be occasioned in these circumstances the proceedings were listed to commence before me today with an estimate of somewhere between 10 and 15 hearing days. 9 One unfortunate characteristic of the affidavit of the first plaintiff is that it contains documents that refer to an offer of compromise made by the defendants. For example, the first plaintiff has annexed a copy of a letter marked "private and confidential" dated 3 August 2009 to her from Messrs Beazley Singleton. The first paragraph of that letter sets out the terms of the defendants' offer. The letter also contains advice to the plaintiffs concerning that offer and recommendations about what response to it should be given. The fact that an offer of compromise had been made by the defendants in the first place, and the terms of that offer in the second place, should in neither case have been referred to in an affidavit that was to be relied upon by the plaintiffs in the present application. Moreover, it is equally unfortunate that the plaintiffs have revealed to me and to the defendants the contents of what would otherwise clearly have been privileged communications between the plaintiffs and their lawyers. 10 Upon my urging Mr Blackburn sought specific instructions concerning the first matter. I was in due course informed that even notwithstanding the fact that the terms of the defendants' offer of compromise have been revealed to me, the defendants do not object to me continuing to hear this case. 11 With respect to the second matter, it seems clear that even though the first plaintiff's affidavit was clearly prepared and read in court before me without the benefit of legal advice, the plaintiffs have in the circumstances waived any privilege that may have been attached to the information it contains. The plaintiffs have not made an application to me that I should disqualify myself. It would in the circumstances be difficult to view such an application sympathetically if it were to be based upon the plaintiffs' own actions in furnishing me with information which, with hindsight, they consider I should not have seen. 12 In opposing the plaintiffs' application for an adjournment Mr Blackburn draws my attention to the recent decision of the High Court of Australia in AON Risk Services Australia Limited v Australian National University [2009] HCA 27. Although published only as recently as 5 August 2009 that case has apparently recast the landscape in applications such as the present one. In considering the way in which that case informs the present debate it is important to ensure that its pronouncements are not given a slavishly adopted mantra-like quality in the way sometimes attributed to what was said by the High Court in Queensland v J L Holdings Pty Ltd [1997] HCA 1; (1997) 189 CLR 146. 13 In AON (supra) at [133] Heydon J said the following: In relation to Queensland v J L Holdings Pty Ltd , it is sufficient to hold that, at least in jurisdictions having rules similar to rr 21 and 502, that case has ceased to be of authority. It is necessary to apply the Rules without any preconceptions derived from what was said in that case. There is a common opinion - it is far from universal, but it is common - within the judiciary and the legal profession that Queensland v J L Holdings Pty Ltd , whether it has been correctly understood or not, has had a damaging influence on the conduct of litigation. One judge who held that opinion was Bryson J. In a passage which merits preservation from the oblivion of unreported judgments, he pointed out one undesirable consequence of the way Queensland v J L Holdings Pty Ltd has been understood:

"In view of the state of the law governing allowance of amendments, amendment applications brought forward before the trial began were treated with uncomplaining supine liberality, notwithstanding that they sometimes showed that problems had been addressed years after they should have been. I do not think that the law requires the discretion to allow amendments to be exercised in entire innocence of understanding the obvious impact of forbearance and liberality on the behaviour of litigants, who have diminished incentive to do their thinking in due time and to tell the court and their opponents their full and true positions. When forbearance and liberality are extended to a delinquent the burden of inconvenience and lost opportunities for preparation tends to fall heavily and without adequate repair on parties who have not been delinquent. A relative disadvantage is imposed on those who proceed methodically and in due time; their interest in procedural justice should claim at least as much consideration as the interests of the applicant for a late amendment who does not have to look far for the creator of his difficulty. It is even conceivable that a litigant might deliberately pursue a course which will impose disadvantage on an opponent who has to reconsider his ground and change course in the midst of a contest." 14 These proceedings were commenced as long ago as 2004. I have briefly referred to a not unimpressive chronology of what has occurred in these proceedings earlier. As far as I am aware the defendants appeared this morning prepared to defend the plaintiffs' case on the imputations as found and unaware either that the plaintiffs were proposing to sack their solicitors or to apply to have the proceedings adjourned. The plaintiffs are financially unable to offer to pay the defendants' costs and have frankly conceded that they will only be able to do so, if at all, if they are successful in the present proceedings. It seems to me in those circumstances that the defendants would be potentially liable to the theoretical prospect of double costs if an adjournment were granted to the plaintiffs without requiring them to compensate the defendants for lost costs and in circumstances where the plaintiffs were later given another hearing date but were unsuccessful in the proceedings. The plaintiffs' application to adjourn today's hearing is wholly of their own making and equally wholly unrelated to any fault or other conduct on the part of the defendants. Subject to one matter to which I will shortly refer it seems to me on balance to be in the interests of justice and the most efficient disposition of these proceedings generally to refuse the plaintiffs' application for an adjournment. 15 The one matter to which I have referred concerns the very real practical problems associated with the fact that the plaintiffs do not have possession of their former solicitor's file in this matter. It seems to me in those circumstances to be not unreasonable to permit the plaintiffs some short time to obtain it before proceeding. I will hear the parties on the question of what is an appropriate time frame for that to occur. 16 I note in passing that I have not sought to form a view about whether or not the plaintiffs' complaints about their solicitors have any substance. It goes without saying that I have neither been given sufficient time nor sufficient information to be able to form even a preliminary view about such claims. It may be that in due course, following my decision on this application, that the plaintiffs will seek to prosecute their dissatisfaction with their solicitors in some other way at some other time. The relationship between the events that promoted the plaintiffs' application today and the ultimate outcome of those complaints will necessarily, or at least arguably, be informed by the plaintiffs' success or otherwise in these proceedings. It is in my opinion also in the interests of justice in these circumstances that these proceedings be determined sooner rather than later. 17 I consider that the plaintiffs' application for an adjournment should be refused.

Gacic v John Fairfax Publications Pty Ltd

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Judgment (11 paragraphs)

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Cases Cited (3)