Graham v Powell

Assessment of damages 10The entry of judgment by Beech-Jones J stands as determination of the elements of the plaintiff's claim for damages, that is, that Mr Powell published the matters complained of and that they conveyed the defamatory imputations pleaded by Mr Graham in the statement of claim. 11The purposes of an award of general damages for defamation are threefold, as explained by the High Court in Carson v John Fairfax & Sons Limited & Slee [1993] HCA 31; (1993) 178 CLR 44 at 60 (citations omitted): The three purposes no doubt overlap considerably in reality and ensure that "the amount of a verdict is the product of a mixture of inextricable considerations". The three purposes are consolation for the personal distress and hurt caused to the appellant by the publication, reparation for the harm done to the appellant's personal and (if relevant) business reputation and vindication of the appellant's reputation. The first two purposes are frequently considered together and constitute consolation for the wrong done to the appellant. Vindication looks to the attitude of others to the appellant: the sum awarded must be at least the minimum necessary to signal to the public the vindication of the appellant's reputation. "The gravity of the libel, the social standing of the parties and the availability of alternative remedies" are all relevant to assessing the quantum of damages necessary to vindicate the appellant. 12In determining the amount of damages to be awarded for those purposes, the court is to ensure that there is an appropriate and rational relationship between the harm sustained by the plaintiff and the amount of damages awarded: s 34 of the Defamation Act. The maximum amount that may be awarded for those purposes is capped at $366,000: Gazette No 57 of 27.6.2014, p 2322. That is the cap that applies to the whole claim in the proceedings even though the plaintiff has been successful in respect of several publications: see Davis v Nationwide News Pty Limited [2008] NSWSC 693 per McClellan CJ at CL at [8] to [9]. 13There are nine publications in the present case. The first to eighth are items made available for downloading on the Internet on two websites operated by the defendant. The ninth matter complained of is an email sent by Mr Powell to a number of email addresses including those of the mayor of Goulburn, various Palerang councillors and mass media outlets. 14There is a single cause of action in respect of each matter complained of, notwithstanding the fact that Mr Graham has pleaded several imputations as arising from each: s 8 of the Defamation Act 2005. Further, s 39 of the Act allows me to assess damages for all nine causes of action in a single sum. In determining the amount of damages to be awarded, I am required to ensure that there is an appropriate and rational relationship between the harm sustained by Mr Graham and the amount awarded: s 34 of the Act. 15A complete list of the imputations sued on is contained in order 5 set out above. 16Mr Graham gave evidence at the hearing. He is a director of Infomedia Limited, a public listed company with about 250 employees worldwide. Mr Graham was a co-founder of that company, which conducts the business of developing and supplying software to automobile dealers. 17Mr Graham said that he was elected to Palerang Council in 2008 and again in 2012. He served a term as Deputy Mayor. He also operates a certified organic farm called "Landtasia" and a hotel called the Carrington at Bungendore. 18Mr Graham said that, so far as he could recall, he had never met Mr Powell prior to the commencement of the defamation. In his role as a councillor on Palerang Council, Mr Graham had become aware of proceedings in the Land & Environment Court between the council and Mr Powell's wife, Ms Banfield. In those proceedings, Ms Banfield was convicted of contempt of court: see Palerang Council v Banfield (No 2) [2012] NSWLEC 158. 19That judgment was published on 5 July 2012. In around November 2012, Mr Graham became aware that a website operated by Mr Powell contained statements to the effect that the general manager of the council and others were corrupt and had falsified evidence in that court hearing. Throughout December 2012, Mr Powell sent a series of emails to councillors drawing their attention to the website and the fact that they were mentioned on it. In late December 2012, Mr Graham went to the website himself and saw what was published. 20On 31 December 2012, Mr Powell sent an email to one Mr Harrison, copied to councillors at Palerang Council, stating: Sir, I have concluded that you have an undisclosed interest in Graham's Compost Factory. Would you care to deny that? I will print your denial on my Internet site if you choose to respond. 21Mr Graham responded to the email as follows: While your question was addressed to Mr Harrison, I can confirm to you that neither he nor any current or past Palerang elected official or employee has any pecuniary interest whatsoever in my on-farm composting facility, whether that interest be in the past, current or prospective. I trust this clarifies the question you ask. 22There followed an exchange of emails between Mr Graham and Mr Powell in which Mr Graham's attempts to provide answers to further questions posed by Mr Powell were consistently met with scepticism on the part of Mr Powell. The exchange concluded with Mr Powell asking Mr Graham not to email him anymore. 23Mr Graham gave evidence that, following that exchange, things seemed to be quiet for a while but that from about April 2013 Mr Powell began publishing further material on the website and sending emails to councillors drawing attention to his postings. The postings included the matters complained of in these proceedings. Mr Graham gave evidence, which I accept, that his response to the defamatory publications was "a whole cacophony of feelings from anger to disbelief". He was particularly concerned at the fact that the publications were made at a time when he was seeking to make a transition from the operational side of his business, Infomedia Limited, to a governance position as a non-executive director. He was concerned that the publication of the defamatory material by Mr Powell would impair his prospects of obtaining future board positions. 24Mr Graham gave evidence of his awareness of the permanent availability of material on the Internet. He said that even if material is taken down by the operator of a website, it is always accessible. On the basis of his experience in the corporate field he said that, in the case of applicants for a position as a member of a board of a company, professional researchers would look for and be able to find the information. He was gravely concerned that the availability of the information posted by Mr Powell would prevent him (Mr Graham) from securing board positions in the future. 25Mr Graham said that he had tried to keep the detail of Mr Powell's defamatory publications from his family because he did not want them to be hurt but that he himself was very hurt. He had experienced what he perceived to be a loss of standing in the Bungendore community due to public response to the publications. 26On 19 May 2013, Mr Powell sent an email to Mr Graham as follows: Sir, I have made reference to you on my new website [website address identified] today. Please tell me of any matter which is untrue and upon your proof that it is untrue I will remove it. 27Mr Graham responded by stating that each of the ten accusations in the link provided by Mr Powell was false; identifying those ten accusations and asking Mr Powell to cease defaming him, to remove the defamatory publications from all forms in which they had been made and to apologise. Subsequently, on 24 May 2013, Mr Graham's solicitor sent a letter in similar terms, framed as a letter of demand and concerns notice under s 14(2) of the Defamation Act. In response to that correspondence, Mr Powell did in fact take one of the websites down about 7 days later. He did not apologise. 28As already noted, these proceedings were commenced on 14 June 2013. Mr Graham gave evidence that, following the commencement of proceedings, Mr Powell diverted his attention from websites to emails. He said: All of the slanging and accusations were just intensified in the emails to a greater audience. 29Mr Powell subsequently went to the police with his allegations against Mr Graham. The police declined to investigate them. A senior constable at Queanbeyan evidently determined that the matter should rather be referred to the Independent Commission Against Corruption. Mr Powell sent a copy of the allegations referred to ICAC to Mr Linton Besser, a respected investigative journalist. 30ICAC determined not to take any investigative action, describing Mr Powell's allegations as "speculative and unsubstantiated". 31Finally, Mr Powell commenced private criminal prosecutions against Mr Graham and another person. Those proceedings were ultimately dismissed on the grounds that there was no prima facie case established. Mr Graham spent over $100,000 defending those proceedings. He was awarded costs in the sum of $16,000, which he understands Mr Powell is unable to pay. The decision of the magistrate who dismissed the criminal proceedings noted that the prosecutor (Mr Powell) had not personally seen either accused do anything. The prosecution relied upon the inferences Mr Powell was prepared to draw based on his inspection of documents. The magistrate said: "The prosecutor's witness statements are, on occasion, misleading because an assertion of facts said to be proved by an annexure is not proved by that annexure." 32The magistrate gave a cogent example of that characterisation of Mr Powell's evidence. The magistrate concluded that, even if the documentary material relied upon by Mr Powell had been brought forward in admissible form (which he determined it had not), he was unable to ascertain what legal wrong was capable of being established against either accused by the evidence put forward by Mr Powell. 33In his statement of claim, Mr Graham relies on the following matters in aggravation of the harm sustained by him: a.Mr Powell's failure to take down the matters complained of for a period of approximately seven days after the request that he do so in Mr Graham's email dated 20 May 2013. b.His failure to apologise. c.The sending of a large number of emails in early June following Mr Graham's complaint of defamation, after which Mr Powell was on notice of the falsity of the allegations. d.The incorporation in many of the emails of demands for information coupled with the suggestion that Mr Graham was withholding information in circumstances where Mr Powell had asked Mr Graham not to send him any more emails, saying they were "a waste of time" and had subsequently advised Palerang councillors that he had blocked emails from Mr Graham. e.The "sensational and extreme language" of the matters complained of and the "degrading and disgusting photographs" used by Mr Powell to illustrate them. f.Mr Powell's boast on one of his websites that it had received 243,958 hits by about 27 May 2013, which Mr Graham relied upon as "indicating his pleasure in the widest possible circulation of his allegations". g.The contention that Mr Powell is motivated by a vendetta against Palerang Council following the judgment in Palerang Council v Banfield referred to above. 34As to the last matter, I note that the particulars of aggravation purport to rely upon the facts set out in that judgment. However, at the hearing before me, Mr Richardson, who appears for Mr Graham, accepted that the judgment could only be relied upon to show that Ms Banfield was convicted for contempt, which was relied upon as Mr Powell's motivation for publishing the matters complained of. Without having heard from Mr Powell, I have not ultimately been persuaded that he is motivated by such a vendetta. I am satisfied that the matters relied upon in the balance of those particulars are established and are matters which have served to aggravate the harm suffered by Mr Graham. 35Following the dismissal of the private prosecution commenced by Mr Powell, Mr Graham's solicitors supplemented the particulars of aggravation to rely upon the following further matters: h.Mr Powell's malicious commencement of the private criminal proceedings in circumstances where those proceedings had no prospects of success. i.Mr Powell's knowledge that those proceedings disclosed no prima facie case and the fact that he offered to discontinue the proceedings in return for Mr Graham making certain admissions and repayments. j.Mr Powell's threat to appeal the dismissal of the criminal proceedings following which he offered not to appeal if Mr Graham agreed to mediate these proceedings. k.Mr Powell's knowledge that the criminal proceedings would attract publicity damaging to Mr Graham, which in fact occurred. l.Mr Powell's knowledge that, as he is impecunious, Mr Graham would be unable to recover any of the legal costs he spent on successfully defending the criminal proceedings. m.The inference to be drawn from those matters that Mr Powell commenced the criminal proceedings in an attempt to seek revenge against Mr Graham for suing him for defamation and for being part of the council that successfully took action against his wife. n.Mr Powell's threat during the defence of these proceedings to resume publication of his internet sites. o.Mr Powell's publication, following the entry of default judgment in these proceedings, of further false allegations against Mr Graham to the effect that his property was contaminated and that he had engaged in fraud. p.Mr Powell's filing of complaints against Mr Graham with the police, ICAC, various government bodies and various media outlets. q.Mr Powell's republication of the defamatory allegations after being told that ICAC was not proposing to take any action against Mr Graham and after the criminal proceedings had been dismissed for want of a prima face case. 36As with the earlier particulars of aggravated damages set out above, without having heard from Mr Powell, I have not ultimately been persuaded that Mr Powell commenced the criminal proceedings in an attempt to seek revenge against Mr Graham for suing him for defamation and for being part of the council that successfully took action against his wife. Based on my reading of the matters complained of, I think it is equally probable that Mr Powell's views, whilst irrational, unscholarly and even delusional, are held genuinely by him. 37Mr Graham addressed the further matters of aggravation in his evidence. As to the complaints and publications to the mass media, ICAC and police following his commencement of these proceedings, Mr Graham said that he felt threatened and continuously under threat. He said: It was beginning to affect my health and the performance in my job and with that also what you would expect I think a degree of anger. 38He said that, in respect of Mr Powell's persistence in sending emails, he has experienced "personal terror that it will be never ending". 39I have no difficulty accepting Mr Graham's evidence. I accept that he has been absolutely devastated by the persistence, viciousness and irrationality of Mr Powell's defamatory publications against him. 40Mr Graham called evidence of his good reputation from Mr Peter Gwozdecky. Mr Gwozdecky has known Mr Graham for over 33 years. He said that he has an impeccable reputation both personally and in his business. Mr Gwozdecky said that employees of Mr Graham's whom he has known for 30 years have spoken about him in the most glowing terms. He said that Mr Graham is well regarded in business and is seen as a visionary. Mr Gowzdecky said that he had observed Mr Graham to be extremely upset by the defamation. I accept that evidence. 41As to damage to reputation, Mr Richardson submitted, and I accept, that the imputations are very serious, involving allegations of bribery, theft, corruption and dishonesty against a serving councillor. Further, in his capacity as a company director, Mr Graham's reputation for integrity and financial honesty is very important to him. I would conclude in those circumstances that the defamatory publications have caused substantial and lasting damage to Mr Graham: cf Crampton v Nugawela (1996) 41 NSWLR 176 at 192F to 193. 42Mr Richardson accepted that the circulation of the websites is unknown. He noted Mr Powell's boast in late May 2013 that one of the websites had received 243,158 hits but accepted that that figure seems "most improbable". I consider that the extent of publication is probably considerably more limited. Further, in my view, at least some of the people who downloaded the Internet articles or read the email would have dismissed Mr Powell's allegations as being extravagant, irrational and unsubstantiated. I am nonetheless satisfied that the publications are likely to have done serious and lasting damage to Mr Graham's reputation in the eyes of at least some readers. 43Mr Graham is also entitled to an award of damages for hurt to feelings. As already indicated, I accept without equivocation that Mr Graham has suffered intense hurt as a result of the savage content and the persistence and viciousness of Mr Powell's publications. 44The harm suffered by Mr Graham has undoubtedly been aggravated by the matters relied upon in the particulars set out above. In all the circumstances, I consider that there should be an award of damages, including aggravated damages, in the sum of $80,000.

Injunctive relief 45As to orders 4 and 5 sought by Mr Graham (set out above), Mr Richardson relied upon the decision of Latham J in RSPCA v Mal Davies [2012] NSWSC 1445 at [67] to [77]. That was a case in which, as here, the defendant's persistence in making repeated defamatory publications had the flavour of a vendetta against the plaintiff. Latham J noted that, in many defamation cases, damages are an adequate remedy. In granting an injunction in that case, her Honour had regard to the likelihood that, unless restrained, the defendant would publish similar allegations "despite having been afforded an opportunity to defend those allegations and despite those allegations having been found by a court of competent jurisdiction to be unwarranted" (at [64]). 46The same considerations apply here. The events I have recited have persuaded me that, unless restrained, Mr Powell will persist in his irrational allegations against Mr Graham, notwithstanding the rejection of those allegations by ICAC, the NSW Police and a magistrate and notwithstanding Mr Powell's failure to defend the present action. 47Accordingly, I am persuaded that, in the exceptional circumstances of this case, it is appropriate to grant the permanent injunctions sought. 48Since Mr Powell has not appeared at the hearing of the application for injunctive relief, it is important, in my view, that, in addition to the requirement that the orders be served personally, Mr Powell be put on notice of the fact that failure to comply with the orders could result in his being dealt with for contempt of court. Accordingly, I make the following orders: (1)That judgment be entered for the plaintiff against the defendant in the sum of $80,000. (2)That the defendant be permanently restrained, by himself and his servants or agents, from publishing or causing to be published any of the nine matters complained of in paragraphs 3, 5, 7, 9, 11, 13, 15, 17 and 19 of the statement of claim filed 14 June 2013 in these proceedings, or matters substantially to the same effect as those matters complained of, on the world wide web or otherwise. (3)That the defendant be permanently restrained, by himself and his servants or agents, from publishing or broadcasting of or concerning the plaintiff any of the following allegations or similar allegations: (a)The plaintiff in his role as a Palerang Councillor participated in a transparent fraud. (b)The plaintiff fraudulently lied when he claimed he had spent $100,000 of his own money to build a compost factory. (c)The plaintiff fraudulently lied when he claimed collections for his compost factory would be from the kerbsides in both the Palerang and Queanbeyen Shires. (d)The plaintiff is a liar who uses his public position as a Councillor for private gain. (e)The plaintiff schemed with Mayor Harrison to manufacture lies to tell Allan Powell to conceal the corrupt relationship between him and Mayor Harrison. (f)The plaintiff in his role as a Palerang Councillor thieved public money. (g)The plaintiff in his role as a Palerang Councillor acts as a shyster. (h)The plaintiff in his role as a Palerang Councillor defrauded at least $60,000 from a City to Soil grant. (i)The plaintiff is guilty of fraud, corruption and incompetence in relation to the City to Soil scandal. (j)The plaintiff lied when he told Allan Powell the financial accounts for the City to Soil grant were audited. (k)The plaintiff thieved $56,000 from the City to Soil Funds for his own use by using it for an EIS attached to his DA for his compost factory. (l)The plaintiff bribed the mayor of Palerang Council. (m)The plaintiff, as a Councillor, corruptly obtained $100,000 for his compost factory to which he was not entitled. (n)The plaintiff is a disgusting parasite who dishonestly presented himself as ethically motivated to Palerang Council when all he cares about is enriching himself. (o)The plaintiff as a Councillor rips off Palerang residents. (p)The plaintiff as a Councillor committed a criminal offence when he took for his own use $56,000 from a NSW Environmental Trust grant. (q)The plaintiff, together with Simone Dilkara, misappropriated $56,000 of Trust funds for his own property's DA EIS. (r)The plaintiff corruptly received fees under the City to Soil project. (s)The plaintiff, as a Palerang Councillor, fraudulently misappropriated $56,000 from the City to Soil Project. (t)The plaintiff committed a substantial fraud with respect to the City to Soil project. (u)The plaintiff acted corruptly as a Palerang Councillor in that he misappropriated $56,000 or more from the City to Soil Project and applied it to an EIS to help get approval for his compost factory. (v)The plaintiff corruptly paid Walter Raynold, the former mayor of Palerang Council, contractor fees from the $56,000 or more he had misappropriated from the City to Soil project. (w)The plaintiff engineered a scam called the City to Soil scheme, for the purpose of siphoning off public money to bribe rogue public servants with consultants and contractors fees. (x)The plaintiff fraudulently misappropriated $56,000 of City to Soil Trust Funds to finance an EIS for his compost factory. (y)Mr Graham lied in an email to Allan Powell when he claimed the Financial Reports of the City to Soil Project were audited. (4)That the defendant pay the plaintiff's costs of the proceedings. (5)I direct that these orders and a copy of this judgment be served under cover of correspondence that includes the following statement: "Orders 2 and 3 are injunctions permanently restraining you from publishing the matter identified in those orders. The Court has directed us to inform you that any breach of those orders could result in your being dealt with for contempt of court."

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: 16 October 2014