Gan v Zadravic

District Court of NSW|2021-09-23

Smith v Lucht [2014] QDC 302 Smith v Lucht [2016] QCA 267 Theodore Skalkos & Anor v Joseph Assaf & Anor [2002] NSWCA 14; (2002) Aust Torts Reports 81-644 Thornton v Telegraph Media Group Limited [2011] 1 WLR 1985; [2011] EWHC 1414 (QB) Wallis v Valentine [2002] All ER (D) 275 (Jul); [2002] EWCA Civ 1034; [2003] EMLR 175 Victoria International Container Terminal Limited v Lunt (2021) 388 ALR 376 Watney v Kencian & Anor [2017] QCA 116 Texts Cited: Defamation Amendment Bill 2020, Second Reading Speech, New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 29 July 2020: Category: Procedural rulings Parties: Plaintiff: Stuart Gan Defendant: Anthony Zadravic Representation: Counsel: Plaintiff: Mr J Levine Defendant: Mr A Munro

Solicitors: Plaintiff: Matrix Legal Defendant: O'Brien Criminal and Civil Solicitor File Number(s): 2021/00189786

Judgment

The defendant brings an application for summary dismissal of defamation proceedings commenced after the defendant published the following comments on his Facebook page on 22 October 2020: "Oh Stuart Gan!! Selling multi million $ homes in Pearl Beach but can't pay his employees superannuation. Shame on you Stuart!!! 2 yrs and still waiting!!!"
This publication, which remained online for less than twelve hours, was seen by a limited number of persons, as is evident from the particulars of publication: "Particulars of Publication The said defamatory material was posted by the defendant on his personal Facebook account and it was read and understood by the following person: (i) Troy Rushton; (ii) Adam Crocker; (iii) Facebook friends of the Defendant. The plaintiff relies upon the grapevine effect."
The defendant's application for summary dismissal is brought on the basis of proportionality (Bleyer v Google Inc (2014) 88 NSWLR 670). As the circumstances in which a court would summarily dismiss proceedings for reasons of proportionality alone are acknowledged to be rare, the defendant also points to the likelihood of success at trial on the defences of triviality and justification. It is not, however, submitted that these proceedings should be struck out summarily by reason of these defences.
In the alternative, it is submitted that none of the imputations pleaded can be conveyed and rulings pursuant to Uniform Civil Procedure Rules 2005 (NSW) ("UCPR") are sought.

Evidence

The defendant reads the following affidavits: 1. Affidavit of Stewart O'Connell affirmed on 2 September 2021 2. Affidavit of Anthony Zadravic sworn on 1 September 2021.
The plaintiff relies on the affidavit of Stuart Gan sworn on 22 September 2021.

The test for summary dismissal applications

The summary procedure for striking out pleadings is to be used only in plain and obvious cases: Cumberland v Clark (1996) 39 NSWLR 514. The burden of proof lies on the moving party. It is a significant burden. For the purposes of such an application, all the averments in the statement of claim must be assumed to be true. That is the case in relation to summary disposition applications in the United Kingdom (Ewing v Times Newspapers Ltd [2011] NIQB 63 at [32] ("Ewing"), citing O'Dwyer v Chief Constable of the RUC [1997] NI 403 at 406C), as well as in Australia.
Courts should be particularly cautious in any developing field of law, or where the court is asked to determine evidentiary points on assumed or scanty facts pleaded in the statement of claim.
While evidence by affidavit is admissible (Cumberland v Clark at p 528), the facts of the case must be construed in the plaintiff's favour.

Proportionality

I set out a summary of the development of concepts of proportionality, first in English decisions and, more recently, in decisions in Australia.
Historically, at common law, there have been few doctrinal impediments to a plaintiff seeking to establish liability for defamation. Once the plaintiff established the elements of the cause of action, a presumption of damage to reputation and of falsity arose and the onus shifted to the defendant to establish a positive defence on all issues (except malice, where a plea of qualified privilege had been made). It has made no difference that the claim was trivial or publication was made only to one person. In Duke of Brunswick v Harmer (1849) 4 QB 185, the plaintiff sent his valet to obtain a copy of the magazine first published 17 years beforehand; publication was accordingly made to only one person as the limitation period for other publications had expired long ago. That, however, was sufficient for the action to proceed. Nor was it relevant that the Duke of Brunswick was a serial litigant who brought hundreds of unsuccessful claims before the court. (One example is his action against the King of Hanover in 1848: Duke of Brunswick v The King of Hanover: HL 31 Jul 1848: http://www.commonlii.org/uk/cases/EngR/1848/794.pdf; however, in defence of the litigious Duke, this decision of the House of Lords is still referred to today, most recently in relation to the Star Wars stormtrooper uniforms intellectual property dispute: Lucasfilm Ltd and Others v Ainsworth and Another: [2011] UKSC 39; [2012] 1 AC 208 at [67].)
Then, in the final decade of the twentieth century, development of case management principles and concerns about the quality of administration of civil justice began to be increasingly important in civil proceedings in general and defamation actions in particular. This led to significant changes in the approaches courts took not only to the conduct of litigation, but the potential for misuse of the courts in terms of abuse of process.
The first major consideration of case management abuse of process issues, in Schellenberg v British Broadcasting Corporation [2000] EMLR 296, resulted in a defamation action otherwise ready for trial being dismissed on principles of proportionality. The evidence was that the plaintiff had recently abandoned an earlier trial of similar factual issues against another publisher. Eady J rejected a submission that the overriding objectives of The Civil Procedure Rules 1998 (UK) were irrelevant, saying (at 318): "Even in a jury action it is regarded under the CPR as a judge's duty to take a realistic and practical attitude. He or she is expected to be more proactive even in areas where angels have traditionally feared to tread. I have seen nothing to suggest that the CPR are to be applied any less rigorously, or the judges are to be less interventionist, in litigation of the kind where there is a right to trial by jury. That important right is sometimes described as a 'constitutional right', although the meaning of that emotive phrase is a little hazy. Nevertheless, I see no reason why such cases require to be subjected to a different pre-trial regime. It is necessary to apply the overriding objective even in those categories of litigation and, in particular, to have regard to proportionality. Here there are tens of thousands of pounds of costs at stake and several weeks of court time. I must therefore have regard to the possible benefits that might accrue to the claimant as rendering such a significant expenditure potentially worthwhile."
This approach was followed by the Court of Appeal in Wallis v Valentine [2002] All ER (D) 275 (Jul); [2002] EWCA Civ 1034; [2003] EMLR 175, where the court accepted (at [26]) evidence that the claimant was pursuing a vendetta. It was also relevant that the publication was to one person, where the claimant's reputation was unlikely to have suffered any harm as a result, the award of damages likely to be modest and the legal costs high.
The Court set out the criteria for striking out proceedings as an abuse at [31]: "31. The relevant principles when considering strike out for abuse of process have recently been stated in the judgment of Simon Brown LJ, with whose judgment Nourse and Waite LJJ agreed, in Broxton v McClelland and Another [1995] EMLR 48 5 at 497-498: "(1) Motive and intention as such are irrelevant (save only where 'malice' is a relevant plea): the fact that a party who asserts a legal right is activated by feelings of personal animosity, vindictiveness or general antagonism towards his opponent is nothing to the point. As was said by Glass JA in Champtaloup v Thomas (1976) 2 NSWLR 264, 271 (see Rajski v Baynton (1990) 22 NSWLR 125 at p. l34): 'To impose the further requirement that the donee [of a legal right] must be actuated by a legitimate purpose, thus forcing a judicial trek through the quagmire of mixed motives would be, in my opinion, a dangerous and needless innovation.' (2) Accordingly the institution of proceedings with an ulterior motive is not of itself enough to constitute an abuse: an action is only that if the Court's processes are being misused to achieve something not properly available to the plaintiff in the course of properly conducted proceedings. The cases appear to suggest two distinct categories of such misuse of process: (i) The achievement of a collateral advantage beyond the proper scope of the action - a classic instance was Grainger v Hill where the proceedings of which complaint was made had been designed quite improperly to secure for the claimants a ship's register to which they had no legitimate claim whatever. The difficulty in deciding where precisely falls the boundary of such impermissible collateral advantage is addressed in Bridge LJ's judgment in Goldsmith v Sperrings Limited at page 503 D/H. (ii) The conduct of the proceedings themselves not so as to vindicate a right but rather in a manner designed to cause the defendant problems of expense, harassment, commercial prejudice or the like beyond those ordinarily encountered in the course of properly conducted litigation. (3) Only in the most clear and obvious case will it be appropriate upon preliminary application to strike out proceedings as an abuse of process so as to prevent a plaintiff from bringing an apparently proper cause of action to trial.""
The Court of Appeal went on to note (at [32]) that this abuse "includes the initiation of the claim itself", citing Goldsmith v Sperrings Limited [1977] 1 WLR 478, noting that this and other decisions refusing to strike proceedings out as an abuse had been decided prior to the enactment of The Civil Procedure Rules.
Three years later, the landmark decision Jameel (Yousef) v Dow Jones & Co Inc [2005] All ER (D) 43 (Feb); [2005] EWCA Civ 75; [2005] QB 946; [2005] 2 WLR 1614; [2005] EMLR 353 was handed down. Unlike the clearer evidence of abuse in Schellenberg (losing a similar case) and Wallis v Valentine (vendetta), the main feature relied upon in this application was that proceedings were brought for publication to a handful of persons in the United Kingdom. The Court of Appeal stayed the action, noting (at [67] - [70]) the likely length, cost and complexity of the trial, as well as the extremely limited extent of publication and the prospect that the likely level of vindication would be out of proportion to the costs involved.
The Court had the following to say about Duke of Brunswick v Harmer: "55 There have been two recent developments which have rendered the court more ready to entertain a submission that pursuit of a libel action is an abuse of process. The first is the introduction of the new Civil Procedure Rules. Pursuit of the overriding objective requires an approach by the court to litigation that is both more flexible and more proactive. The second is the coming into effect of the Human Rights Act 1998. Section 6 requires the court, as a public authority, to administer the law in a manner which is compatible with Convention rights, in so far as it is possible to do so. Keeping a proper balance between the article 10 right of freedom of expression and the protection of individual reputation must, so it seems to us, require the court to bring to a stop as an abuse of process defamation proceedings that are not serving the legitimate purpose of protecting the claimant's reputation, which includes compensating the claimant only if that reputation has been unlawfully damaged. 56 We do not believe that Duke of Brunswick v Harmer 14 QB 185 could today have survived an application to strike out for abuse of process. The Duke himself procured the republication to his agent of an article published many years before for the sole purpose of bringing legal proceedings that would not be met by a plea of limitation. If his agent read the article he is unlikely to have thought the Duke much, if any, the worse for it and, to the extent that he did, the Duke brought this on his own head. He acquired a technical cause of action but we would today condemn the entire exercise as an abuse of process .... 69 If the claimant succeeds in this action and is awarded a small amount of damages, it can perhaps be said that he will have achieved vindication for the damage done to his reputation in this country, but both the damage and the vindication will be minimal. The cost of the exercise will have been out of all proportion to what has been achieved. The game will not merely not have been worth the candle, it will not have been worth the wick."
However, since this judgment was handed down in 2005, courts in Australia showed little or no interest in the development of such a doctrine. The view was expressed shortly afterwards, in Alexandrov v Dimovski [2005] NSWDC 19 at [45], that, given the approach taken to the defence of triviality by the New South Wales Court of Appeal and High Court in a series of appeals concerning triviality, the principles enunciated in Jameel were never likely to be accepted by appellate courts in Australia. Sixteen years later, that is still the case in relation to Jameel, an indeed the failure of the statutory defence of triviality is evidenced by its exclusion, as a defence, in the law reform discussion which led to the most recent amendments to the uniform legislation.
In summary, claims of abuse of process invoking Jameel and abuse of process either failed on appeal (Habib v Radio 2UE Sydney Pty Ltd [2009] NSWCA 231) or were not considered by reason of the facts of appeals not being suitable vehicles. An application for summary dismissal on the grounds of proportionality was refused in Smith v Lucht [2014] QDC 302 (a decision endorsed on appeal: [2016] QCA 267) on the basis, inter alia, of absence of procedural rules of the kind applicable in England. What is more, leave to appeal was refused in a series of applications to the High Court concerning the defence of triviality (the judgments from which leave to appeal was sought were Theodore Skalkos & Anor v Joseph Assaf & Anor [2002] NSWCA 14; (2002) Aust Torts Reports 81-644, Jones v Sutton [2004] NSWCA 439; 61 NSWLR 614 and King & Mergen Holdings Pty Ltd v McKenzie (1991) 24 NSWLR 305), thereby depriving the High Court of opportunities, over two decades, to consider new doctrines and ideas about the conduct of litigation and to consider what amounted to trivial defamation claims.
This reluctance was not restricted to defamation actions. The Jameel doctrine is a remedy for abuse of process generally, and its applicability is not restricted to defamation actions. Apart from a brief reference to proportionality in cost issues in Grizonic v Suttor [2008] NSWSC 914 at [8] - [10], the Jameel principles remained unexplored in Australia in other areas of the law.
Despite Jameel's endorsement in Bleyer in 2014, it has yet to receive endorsement on appeal. In Massarani v Kriz [2020] NSWCA 252, McCallum JA, revisiting the issue of proportionality that she had set out in Bleyer, had this to say (at [4], [5], footnotes omitted): "In Bleyer v Google, sitting then as a judge of the Common Law Division, I granted a permanent stay of an action for defamation on the basis that the proceedings were an abuse of process because the resources of the court and the parties that would be expended to determine the claim were out of all proportion to the interest at stake. The plaintiff's claim in that case raised issues of considerable complexity. The interest at stake was his entitlement to vindicate his reputation in the eyes of one person. There was evidence estimating the defendant's likely costs in the hundreds of thousands of dollars and doubt as to the enforceability against it of any judgment. The decision has met with some criticism. Where it has been considered by appellate courts, other Supreme Courts and the Federal Court, it has arisen in circumstances where it was unnecessary for the court to express a view as to its correctness. Accordingly, it may well warrant appellate consideration in an appropriate case. This is not that case. Here, the decision of the primary judge was an orthodox ruling striking out parts of a pleading that failed to articulate the elements of a reasonable cause of action coupled with an unassailable discretionary decision refusing leave to replead. To the extent that the primary judge had regard to the prospect of disproportion between the resources the claim would command and the interest at stake, her Honour did so permissibly…"
It is opportune to raise another aspect of proportionality and abuse of process in relation to defamation actions. Although not referred to in the submissions made to me in this application, there was in fact a second, and more far-reaching, doctrine that the English courts developed to deal with trivial or marginal defamation claims, a doctrine that originates from the principles of defamation law themselves.
In Thornton v Telegraph Media Group Limited [2011] 1 WLR 1985; [2011] EWHC 1414 (QB), Tugendhat J held that the tests for what was defamatory contained a minimum threshold of seriousness which must be surmounted for a statement could be regarded as actionable. This was because the variously expressed tests as to what was defamatory all required that the statement should tend to cause substantial harm to the plaintiff's reputation. The doctrine was in part based on the observations of Lord Atkin in Sim v Stretch [1936] 2 All E R 1237 at 1242 as to the need to distinguish between real injury to reputation, as opposed to mere "exhibitions of bad manner or discourtesy", which should not be actionable. (The reliance on Sim v Stretch is noteworthy, as the publication in that case was a telegram between neighbours about the employment of a maid, a factual situation of the kind which now lends itself to complaints of disproportionality.)
However, Thornton has had an even weaker reception in Australian law than Jameel. To the extent that there has been any consideration of the principles of serious harm discussed in this judgment, it has been to the effect that an acceptance of the principles for which it stands does not materially alter the settled approach to determine defamatory meaning (Lesses v Maras [2017] SASFC 48; (2017) 128 SASR 292 at 125 per curiam), and to suggest that the decision requires that the threshold of seriousness must be low (Armstrong v McIntosh (No 2) [2019] WASC 379 at [75] - [83] per Le Miere J; Armstrong v McIntosh (No 4) [2020] WASC 31 at [112]).
The sole exception is, once again, a decision of McCallum J (as her Honour then was). Even so, while a degree of endorsement of its principles may be seen in her Honour's judgment in Kostov v Nationwide News Pty Ltd [2018] NSWSC 858; (2018) 97 NSWLR 1073 at [37]), the main basis for dismissal of the proceedings was that the publication did not convey any defamatory imputations.
Ten years after Thornton was handed down, it continues to be ignored, even in applications such as the present. It is clear that the common law in this area will never develop, hence the impetus for the introduction of a serious harm threshold as part of the legislative amendments which came into force for publications made since 1 July 2021 (see the observations of Attorney-General Mr Mark Speakman of 29 July 2020: Defamation Amendment Bill 2020, Second Reading Speech, New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 29 July 2020: https://www.parliament.nsw.gov.au/Hansard/Pages/HansardResult.aspx#/docid/'HANSARD-1323879322-111420).
Returning to the basis upon which this application has been brought, namely upon the principles set out in Jameel, it has been made clear that proportionality alone, as a basis for dismissal, would succeed only very rarely: Ghosh v NineMSN Pty Ltd [2015] NSWCA 334; 90 NSWLR 595 at [44]. In Watney v Kencian & Anor [2017] QCA 116 Applegarth J referred to the Jameel principle (at [48] and [49]), and Bleyer (at [52] and [53]), noting (at [57]) the respondent's position that: "(a) Publication was made to only two persons, including republication by the original recipient; (b) The limited publication is consistent with the applicant, assuming success, only being entitled to a comparatively modest award of damages, and one that is disproportionate to the cost to be borne by the parties and the community …"
At [64], his Honour stated: "The existence of a statutory defence of triviality may be a basis upon which to distinguish the positions in England and in Australia. However, that argument would depend upon an assessment of whether the defence of triviality is adequate to protect defendants and the court system from being vexed by the type of proceeding at which the Jameel principle is directed. Arguably, a defendant who has a viable defence of triviality should be able to invoke the Jameel principle at an early stage of proceedings so as to avoid the costs associated with defending a matter to trial, and in seeking to uphold a judgment in its favour, upon appeal. If the Jameel principle and the defence of triviality may co-exist, then they provide different forms of protection. As Basten JA noted in Bristow, the application which succeeded in Jameel was a pre-trial application for a stay of proceedings in order to avoid disproportionate expenditure on a trial."
In the present case, the defendant agrees that proportionality alone will rarely suffice for summary dismissal, but submits that the defendant's prospects of success in relation to two defences should be considered in conjunction with the Jameel principles, namely triviality (s 33 of the Defamation Act 2005 (NSW)) and justification (both as a defence and in terms of mitigation).

Proportionality and Triviality

The Victorian Court of Appeal in Defteros v Google [2021] VSCA 167, referring to Barrow v Bolt, set out the relevant elements of this defence at [251]: "The basic principles, relating to s 33, were stated by the trial judge, and are uncontroversial. In short, they may be stated as follows. First, the inquiry, whether the publication was likely to cause harm to the applicant, is directed to the time of publication. The issue, at that time, concerns '… the quality of the publication in respect of its proneness to cause harm.' Secondly, the focus of the inquiry is on the 'circumstances of the publication'. The critical test is whether those circumstances were such, at the time of publication, that it was unlikely that the applicant would suffer harm. The circumstances include (inter alia) the content of the publication, the extent of the publication, the nature of the recipients and their relationship with the applicant. However, the phrase 'circumstances of the publication' is not sufficiently wide to encompass the previous bad reputation of a plaintiff. Thirdly, the phrase 'unlikely to sustain any harm' does not mean that it is sufficient for the defendant to establish that it is 'more probable than not' that the plaintiff will not suffer harm. Rather, the defendant must demonstrate that there is 'the absence of a real chance', or the 'absence of a real possibility', of harm. Fourthly, the defendant is required to establish that, at the time of publication, the circumstances were such that the plaintiff was unlikely to suffer 'any' harm. Accordingly, the onus, on the defendant, to prove that matter, is high. Fifthly, the defence, provided by s 33, applies to the publication of 'defamatory matter'. Thus, s 33 provides a defence where matter, that has been published, is defamatory of the plaintiff. In order to be defamatory, the matter must tend to lower the reputation of the plaintiff in the eyes of ordinary reasonable members of the community. Thus, s 33 contemplates a case in which, notwithstanding that a publication about a plaintiff is defamatory in that sense, nevertheless the 'circumstances of publication' were such that the plaintiff was unlikely to sustain any harm as a result."
The factors pointed to by the defendant are as follows: 1. The Facebook post was made late at night and deleted early the next morning, less than 12 hours later. 2. The plaintiff has only identified two readers of the matter complained of in the statement of claim. One is a business colleague of the plaintiff who is in fact is the co-owner of the real estate business run by the plaintiff and which previously employed the defendant, and the other is an employee of that business colleague in another business. Both these persons are asserted to be likely to be well acquainted with the plaintiff and to make a judgment based on their own knowledge of the likelihood of there being any substance to the imputations conveyed. 3. The imputations are asserted not to arise.
The defendant's affidavit sets out that he had 913 Facebook friends at the time, less than 10 of whom were mutual friends with the plaintiff. The defendant made the post after seeing a Facebook post made by the plaintiff referring to a "record-breaking sale for $5.5 million" in his Facebook feed, namely the house at Pearl Beach referred to in the matter complained of. The defendant made the post at approximately 10:30 PM and it was removed less than 12 hours later.
The defendant does not identify any of the 913 Facebook friends. For example, I do not know whether the two persons identified by the plaintiff were also Facebook friends of the defendant. If, however, there were up to 10 people who were Facebook friends of the defendant who were also friends of the plaintiff, the likelihood is that, because of the common background of real estate interests, the defendant and plaintiff share a number of acquaintances. The use of Facebook to publicise successful sales by real estate agents can be gleaned from the circumstances in which the plaintiff posted that he had made a record-breaking sale for $5.5 million on his Facebook feed.
The common professional background of the plaintiff and defendant is relevant to the nature and extent of the publication. The publication in question related to the plaintiff's conduct as a real estate agent in circumstances where the likelihood is that other persons who were Facebook friends with the defendant had an interest in real estate, bearing in mind that the defendant was a real estate agent as well. If the subject of the post had related to some more obscure activity of the kind unlikely to be shared by other Facebook users of the defendant, the degree of interest to the other Facebook friends would likely be less.
I also note the 10 - 12-hour period of time during which the post was online, much of which was during the night. Nevertheless, the nature of social media is such that, given the continuous feed of posts scrolling through accounts, the first twelve hours or so are the most potent, in terms of the nature and extent of harm. As many social media users (and advertisers) know, reading social media posts late at night is a relatively common activity.
The main difficulty, however, is the seriousness of the claims made in the matter complained of and the imputations which correspondingly arise. Most unfortunately for the defendant, the word "employees" does not have an apostrophe between the "e" and the "s", with the result that the ordinary reasonable reader would draw the conclusion that more than one employee had not had their superannuation paid.
Failure to pay employee superannuation contributions may amount to a criminal offence. Employers' obligations to make employee superannuation contributions are contained in the Superannuation Guarantee (Administration) Act 1992 (the Administration Act") and the Superannuation Guarantee Charge Act 1992 ("the Charge Act"). In Council of the Law Society of NSW v Kingston [2014] NSWCATOD 21, the following statements from the judgment of Heydon J in Roy Morgan Research Pty Limited v Commissioner of Taxation [2011] HCA 35 about the operation of this legislation, were set out at paragraph 116: 53 There is no general duty on private employers to pay superannuation contributions to superannuation funds for the benefit of their employees. But particular obligations to pay superannuation contributions can arise in various ways. They may be created by an award or certified agreement. They may be created by contract. 54 Section 5 and 6 of the (Charge Act), impose a superannuation guarantee charge on all employers. It is calculated by reference to an employer's "superannuation guarantee shortfall" as defined in the Administration Act (s17). That shortfall is the difference between nine percent of a given employer's total salary or wages for a quarter and what the employer contributed to a retirement account or certain types of superannuation fund for the employee's benefit, plus a nominal interest component and an administration component. The function of the interest component is to compensate for fund earnings foregone by the failure to pay the nine percent. The function of the administration component is to recover expenses associated with administering the superannuation guarantee charge. The legislation creates an obligation on the employer to pay the charge to the Commissioner of Taxation which is enforceable as a debt due to the Commonwealth…. . 57 The superannuation guarantee charge provides an incentive to employers to make superannuation contributions at the rate of nine percent of employees' wages. It ensures that in relation to employees of employers who fail to do so there will be payments into approved superannuation funds equivalent to those which the employers did not make. There are significant factors influencing employers to make superannuation contributions directly to superannuation funds for their employees' benefit rather than paying the superannuation guarantee charge. Direct superannuation contributions are tax deductible; payments of the superannuation guarantee charge are not. Payments of direct superannuation contributions avoid the nominal interest and the administration component of the superannuation guarantee shortfall….
Failure to make such payments may result not only in fines but also in disciplinary proceedings being commenced against the members of certain professions, such as solicitors: Council of the Law Society of NSW v Etherington [2016] NSWCATOD 31. Such conduct would be regarded as being more serious if more than one employee were involved.
Even if the defendant were able to establish that he had not been paid his full superannuation entitlements, taking all of the above into account, I am satisfied that the making of an allegation of failure to pay superannuation payments for employees is a serious allegation which, on a summary basis, would sufficiently fall outside the parameters of a triviality defence as to warrant no allowance being taken of prospects of success in relation to this defence.
Even if that had not been the case, there remains a fundamental flaw in the defendant's argument. Mr Levine submits, and I agree, that the principles of proportionality and triviality are not cumulative, but are alternatives (or at best overlap), and reliance upon the potential for success at trial for a defence of triviality to warrant summary judgment is misconceived.

Justification and mitigation

The defendant's prospects of success in relation to a defence of justification, including partial justification and any mitigation of damages, are even weaker than his likelihood of success in relation to the defence of triviality. This is because the matter complained of refers to "employees" in the plural. Even if the defendant can establish that he had not been paid his superannuation entitlements, there is no evidence of failure to pay other employees their entitlements.
There is an additional difficulty for the plaintiff, in the form of the affidavit of Mr Gan sworn on 22 September 2021, which sets out details of the payment in question and a letter from the company accountant dated 20 December 2020 verifying that the defendant's superannuation had been paid. In a summary judgment application, I must take that evidence at its highest. It may be that the defendant, at trial, has difficulty establishing even that his own superannuation payments and entitlements were incorrect.
I do not consider that there is sufficient evidence of prospects of success on justification or mitigation of the kind submitted by the defendant, or that there is a likelihood of a nominal or derisory damages award.

Legal costs

I have read the affidavit of Mr O'Connell, which asserts that the total costs of the trial will exceed $250,000 if senior counsel is retained. It was conceded during the hearing that if senior counsel were not retained, a realistic estimate would be $160,000.
I note the reference to comparable awards of damages: 1. In Asbog Veterinary Services Pty Ltd v Barlow [2020] QDC 112, there were seven publications on Facebook Twitter and a local website at managing overcharging resulted in damages of $10,000 to the first plaintiff and $15,000 to the second plaintiff. There were 170 Twitter followers, 370 Facebook friends and the post was shared 473 times. 2. In Noone v Brown [2019] QDC 133, there were three posts onto Facebook pages alleging the plaintiff had been dismissed from a job for alcohol use which resulted in an award of $15,000. There were 180 Facebook followers and another 300 who followed a different page of the account. There were however significant mitigating factors in that matter.
While it is difficult to assess the likely range of damages for this publication in the absence of sufficient information as to the nature and extent of publication, I am satisfied that the seriousness of the allegations would be a relevant factor in terms of the award to be made. There may also be aggravating factors of which I am unaware, in which case the cap would not apply.

Conclusions concerning summary dismissal application

These proceedings are asserted to be an abuse principally by reason of the asserted limited extent of publication set out in the statement of claim, which is asserted to be out of all proportion to the legal costs involved.
A plaintiff is not obliged to set out his or her full case on the extent of publication in the statement of claim. All that is necessary is to establish publication to one or more third parties. In any event, mere limited publication, where the imputations are serious and where the potential for wider dissemination on social media is possible, will rarely be a basis for a successful Jameel application; as several judges have observed, this is not a numbers game (Desfosses v Martinson [2018] WASC 114 at [36]).
Nor is it relevant that the costs of the action far exceed the damages. This is the case for just about every defamation action commenced in Australia. I agree that this is a matter for concern but, unlike other jurisdictions such as the United Kingdom, Australian legislators have shied away from any inquiries or research projects into defamation costs in this country, so this is unlikely to change at any stage in the future.
As to the claim that the imputations pleaded are not reasonably capable of being conveyed, I have set out below my reasons for finding to the contrary in relation to each of the imputations pleaded.
Finally, it should not be forgotten that the fundamental responsibility of a court is to do justice between the parties; while, in the performance of that function, the doing of justice may require the court to protect itself from abuse of its process, the power to stay, or summarily dismiss, proceedings for abuse of process is essentially "a measure of last resort": Victoria International Container Terminal Limited v Lunt (2021) 388 ALR 376 at [21]. As Porter QC DCJ noted in Sherman v Lamb [2021] QDC 192 at [39], where a remedy for abuse of process is sought, the concern of the Court is whether the abuse of process is such that the remedy of dismissal is justified, and whether there is no other way to protect the integrity of the system of justice administered by the court. That is not the case here.
On the facts in the present case, for the reasons set out above, there would be no justification for dismissal of the claim as an abuse on the principles of the Jameel doctrine. (That, of course, is a somewhat different basis for dismissal to the different issues posed by Thornton doctrine but, as noted earlier, this application was not brought on that basis.) The defendant has accordingly failed to establish that the court resources and time necessary to hear this action, along with the potential legal costs, warrant summary dismissal of these proceedings.

Challenges to the imputations

The defendant alternatively challenges the form and capacity of the imputations pleaded.
The relevant test for the determination of capacity, for the purposes of UCPR r 28.2, is set out in Corby v Allen & Unwin Pty Ltd [2014] NSWCA 227.
The relevant principles of law in relation to challenges to the form of imputations are set out in Drummoyne Municipal Council v Australian Broadcasting Corporation (1990) 21 NSWLR 135 at 135 -137.
The imputations pleaded are: 1. That the plaintiff takes advantage of his employees by not paying them their superannuation entitlements. 2. That the plaintiff is deceitful by misappropriating funds. 3. That the plaintiff is not a good employer to work for in that he has disregard for his employees.

Imputation (i)

The plaintiff submits that there is nothing in the matter complained of giving rise to an act or condition of the plaintiff is "taking advantage" of his employees. The qualification of the imputation "by not paying them their superannuation entitlements" is asserted to be incapable of arising, in that nothing in the matter complained of could suggest to the reasonable reader that the plaintiff had taken a course of conduct which amounted to taking advantage of his employees.
The terms of the matter complained of referring to the sale of multimillion dollar "homes" in the plural, suggesting a hive of activity, keeping his employees busy. The picture is painted of the plaintiff having plenty of time to attend to, and profit from, these high-profit sales, but not finding the time to pay his hardworking employees' superannuation. The inference is that the employees helping to achieve these results are not being paid what they deserved.
On the Corby test, this imputation is reasonably capable of being conveyed.
This imputation is also challenged as being bad in form, on the basis that the phrase "takes advantage" is unclear. However, as Gleeson CJ pointed out in Drummoyne Municipal Council v Australian Broadcasting Corporation at 137, using the famous example "X is disgusting" (an example even more relevant today than it was in 1991, thanks to social media). For the reasons enunciated by Gleeson CJ, an imputation need only be as precise as the matter complained from which it is distilled. In the present case, I am satisfied that the form of this imputation is, given the generalised smear that is the matter complained of, sufficiently clear.

Imputation (ii)

The defendant challenges the word "deceitful" on the basis that it could only mean dishonest, untrustworthy or engaging in deliberate fraudulent activities.
The difficulty for the plaintiff is the use of the word "employees" in the plural. This suggests a systematic pattern of conduct. The statement that the assertion is aimed only at the plaintiff not paying the defendant's superannuation fails to take this into account. To fail to pay one employee's superannuation entitlement might be seen as unfortunate; to fail to pay some or all of them looks deliberate.
It was unclear from the defendant's submissions whether the challenge to this imputation was brought merely on the issue of capacity, or whether there was also an objection is to form. If there is an objection to form on the basis of a claimed lack of clarity, I would have rejected it, on the basis that there is no need for precision where the publication in question is in the broad terms clearly the case here.

Imputation (iii)

This imputation is challenged as being incapable of arising on the basis of the matter complained of makes no such assertions. It is of lesser seriousness than the second imputation. It may be that the tribunal of fact takes the view that this imputation, as opposed to the more serious imputation of dishonesty, is conveyed.
This imputation is reasonably capable of being conveyed.
As to form, I reject the challenge to an asserted lack of specificity for the same reason as the other two imputations challenged on this basis.

Costs

The defendant has been unsuccessful in all applications. Costs should follow the event. The parties should bring in Short Minutes of Order for a timetable for the future conduct of these proceedings.

Order: 1. Defendant's application for summary dismissal of these proceedings pursuant to UCPR rr 13.4(1)(c) and 14.28 is dismissed. 2. Pursuant to UCPR r 28.2, imputations (i) - (iii) are reasonably capable of being conveyed. 3. Defendant's challenges to the form of imputations (i) - (iii) dismissed. 4. Defendant pay plaintiff's costs.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 07 October 2021

(2018) 97 NSWLR 1073

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Cases Cited (31)