Hunt v Radio 2SM Pty Ltd

Civil Procedure Act 2005 (NSW), ss 56-62 and 98 LEGISLATION CITED: Defamation Act 1974 (NSW), s 7A Defamation Act 2005 (NSW), s 18

Barbaro v Amalgamated Television Services Pty Ltd (1985) 1 NSWLR 30; (1985) Aust Torts Reports 80-698 Bickel v John Fairfax & Sons Ltd [1981] 2 NSWLR 474 Gacic v John Fairfax Publications Pty Ltd (2006) 66 NSWLR 675; [2006] NSWCA 175 Halbish v John Fairfax & Sons Ltd (Supreme Court of NSW, Newman J, 17 February 2000, unreported) Harvey v John Fairfax Publications Pty Ltd [2004] NSWSC 188 Hepburn v TCN Channel Nine Pty Ltd [1983] 2 NSWLR 664 John Fairfax Publications Pty Ltd v Obeid (2005) 64 NSWLR 485; [2005] NSWCA 60 Jones v Sutton (2004) 61 NSWLR 614; [2004] NSWCA 439 Lane v Reid [2005] NSWCA 198 Lever v Murray [1992] NSWCA 132 Mirror Newspapers Ltd v World Hosts Pty Ltd (1979) 141 CLR 632; (1979) 23 ALR 167; (1979) 53 ALJR 243 CASES CITED: Monie v Commonwealth of Australia (No 2) [2008] NSWCA 15 Morgan v John Fairfax & Sons Ltd (1988) 13 NSWLR 208 Morgan v John Fairfax & Sons Ltd (1990) 20 NSWLR 511 Morgan v Odhams Press Ltd [1971] 2 All ER 1156; [1971] 1 WLR 1239 Nationwide News Pty Ltd v Aitken [2004] NSWCA 311 Nationwide News Pty Ltd v Noriega [2004] NSWCA 420 Phelps v Nationwide News Pty Ltd [2003] NSWSC 1104 Ra v Nationwide News Pty Ltd [2009] FCA 1308 Steele v Mirror Newspapers Ltd [1975] 2 NSWLR 48 Strasberg v Westfield Ltd [2003] NSWSC 1021 TCN Channel Nine Pty Ltd v Antoniadis (1998) 44 NSWLR 682 Yoon Shin Lee v Bob Chae-Sang Cha [2005] NSWCA 279

TEXTS CITED: Brown, The Law of Defamation in Canada (2nd ed.)

PARTIES: Plaintiff: Robert Christopher Hunt Defendant: Radio 2SM Pty Ltd

COUNSEL: Plaintiff: Mr C A Evatt / Mr C J Dibb Defendant: Mr A T S Dawson

SOLICITORS: Plaintiff: W D Hunt & Associates Defendant: Banki Haddock Fiora

[1] HER HONOUR: This is an application to discharge the jury during the closing addresses made at the end of a trial which is in its fifth day.

[2] I start by noting the warning of the Court of Appeal that courts should be reluctant to discharge juries, particularly where it is late in the trial, and should do so only after other ways of curing the problem have been exhausted. In TCN Channel Nine Pty Ltd v Antoniadis (1998) 44 NSWLR 682 and Morgan v John Fairfax & Sons Ltd (1988) 13 NSWLR 208 the Court of Appeal has stressed jury discharge is a step of last resort.

[3] Mr Evatt foreshadowed the possibility of a discharge application on Friday afternoon, at the close of Mr Dawson's address to the jury at 4pm. Mr Dawson's address to the jury had commenced about an hour and a half earlier. Mr Evatt complained of sixteen references by Mr Dawson in the address to a caller on the radio broadcast the subject of proceedings whom he described to the jury as "Mr Lobsey" when the caller had only identified himself on the radio broadcast as "Les". The ordinary reasonable reader would not have known that the "Les" was this "Mr Lobsey", about whose alleged troublemaking activities there has been considerable cross-examination on issues relevant to damages but not to defamatory meaning. In addition, in relation to issues of "reasonableness" for the s 18 Defamation Act 2005 (NSW) ("the Act") defence to the first publication, there was no evidence that the identity of "Les" or his voice, were generally known to persons in rural New South Wales and Queensland, or that he was universally or even widely known in the Quirindi area, either as "Mr Lobsey", or a troublemaker, or both. He is certainly known to the councillors who received a copy of the broadcast which is the second matter complained of, and the naming of Mr Lobsey in this issue would not have been a problem.

[4] The general principles concerning discharge of juries in defamation trials are set out in a series of decisions of the Court of Appeal, commencing with Morgan v John Fairfax & Sons Ltd, supra, and reviewed more recently in Yoon Shin Lee v Bob Chae-Sang Cha [2005] NSWCA 279. Where an application is brought for a discharge of the jury, the obligation of the counsel who brings it is as set out in Gacic v John Fairfax Publications Pty Ltd (2006) 66 NSWLR 675; [2006] NSWCA 175 at [47]: "When an erroneous or misleading statement is made during the course of counsel's address to the jury, it is the duty of opposing counsel to raise the matter before the trial judge and seek that appropriate action be taken. That can be by way of seeking a direction or redirection as the case requires, or, in an extreme case, a discharge of the jury. In this case, counsel for the appellants took the appropriate step at the end of the address by senior counsel for the respondents and sought a direction by her Honour. The appellants complain, however, that her Honour failed to give adequate directions to the jury given the problem that had been created by senior counsel for the respondents consistently putting to the jury that defamation meant lowering a person in the eyes of right minded members of the community." [5] Generally speaking, any such application should be made at the first opportunity, to give the opponent an opportunity to correct the error, this being preferable to a discharge, especially late in the trial: see Lever v Murray [1992] NSWCA 132.

[6] I should also note that the trial judge has obligations in this regard. Samuels JA, in Steele v Mirror Newspapers Ltd [1975] 2 NSWLR 48 at 59, made it clear that the trial judge should have intervened "of his own motion" to require counsel to withdraw inflammatory statements made in his closing address at the end of a hard-fought defamation trial. No application was made by counsel in that trial at the time. As it happened, I did note some references to Mr Lobsey, but I was slower to pick it up than Mr Evatt, in that I only noticed the references to his name towards the end of Mr Dawson's address to the jury, and certainly I had not heard the "sixteen" that Mr Evatt complained of.

[7] Reference to "Mr Lobsey" by that name is, as I have indicated, not a problem for issues to which his identity is relevant. The identity of Mr Lobsey, and whether he is known to the councillors or in the Quirindi area as a troublemaker, are matters which the defendant says are relevant not only to reasonableness but also as to whether the imputations are conveyed in the second publication to the councillors. The defendant's case is that since Mr Lobsey is known to the councillors as a troublemaker, some or all of the imputations may not be conveyed or, if conveyed, may not be defamatory; the ordinary reasonable listener who knows who he is comes away from the broadcast thinking he is stirring up trouble about Mr Hunt and that some of the words he uses, such as "they", are the sort of things that troublemakers say (see T-511). In other words, when councillors such as Mr McGarry heard Mr Lobsey's voice (for the second publication), as soon as they heard it they knew that what he said was "going to be ridiculous" (T-513).

[8] Later in this judgment I will set out some of the legal principles concerning whether an imputation can be conveyed or defamatory where a person does not believe what is said or knows it to be untrue. This submission is not the gravamen of Mr Evatt's complaint; it is simply a further complication.

[9] The defendant principally says, however, that Mr Lobsey's identity as a troublemaker, which was known to council, means that damages for the broadcast (which I note was broadcast to twenty-one regional areas in New South Wales and Queensland), as well as for the second publication to the council, were of such an order that the offer of $15,000 and an apology was "reasonable" for the purposes of s 18.

[10] In his application for discharge of the jury, Mr Evatt has made submissions concerning the references to Mr Lobsey, the references to "Paul" and to the compere, Gary Stewart, and to portions of the address concerning the asserted truthfulness of what they say, and to other references in the transcript which could mislead the jury into thinking that truth or falsity was part and parcel of whether imputations were conveyed and defamatory, on the basis that these bring issues of truth or falsity into consideration of whether or not the imputations are conveyed and defamatory.

[11] Mr Lobsey's reputation as a troublemaker would be relevant to a defence, such as unlikelihood of harm (which I note, however, is not pleaded here) as well as s 18, and also to damages. It is submitted to be referable to the defence of offer of amends. The extrinsic material concerning his troublemaking activities and his identity, including his surname, were unknown to the radio listeners and, by reason of the principles I will set out later, even if known, would not necessarily mean that the imputations could not be conveyed and/or not defamatory.

[12] Mr Dawson indicated on Friday that he would look at the transcript to see what corrections needed to be made. He has said that any error was inadvertent, and I unreservedly accept this. However, the discharge of a jury is not limited to deliberate wrongdoing by counsel or a party. Accidental errors or misstatements, as I said during the submissions, may similarly result in a discharge as the Court of Appeal noted in Steele v Mirror Newspapers Ltd (at 54, per Huttley JA; and at 57, per Samuels JA) where Samuels JA noted that "either may have disastrous consequences".

[13] The question for determination on an application for discharge of the jury in a defamation jury trial may generally be stated as being whether the material was of such potency that no direction could have erased its effect: see Bickel v John Fairfax & Sons Ltd [1981] 2 NSWLR 474 at 499. Juries have been discharged in a number of s 7A trials where addresses to the jury have included material that arguably had the effect of importing truth or falsity into a consideration of defamatory meaning, and I note in particular the decision of Newman J in Halbish v John Fairfax & Sons Ltd (Supreme Court of NSW, Newman J, 17 February 2000, unreported).

[14] The steps that a judge should take with an application of this kind are to consider every other possibility, and to treat any application for a discharge as something of last resort. A judge should try everything that is possible.

[15] On Friday afternoon, when Mr Evatt brought this application, I mentioned some matters to Mr Dawson as matters that I hoped could be reviewed by him, so that was the first step I took. The second step I took was to invite the parties this morning to consider the best way forward, and for that purpose I had over the weekend reviewed the transcript and prepared what I considered to be the sort of direction that I could make, as well as asking counsel the course to be taken. It is never easy for a judge to prepare a direction to the jury. It is unclear whether the judge should prepare it as an "ambit" claim, covering every possible matter, on the understanding that counsel will cross out all the bits they do not like, or whether the judge should just simply put it before the parties doing the best he or she can. There is always the risk that the judge may overstate or understate the issue, without meaning to, in the anxiety to solve the problem.

[16] What I was hoping was that if I did give the direction in question, Mr Dawson would, if not start again, basically re-address on imputations and defamatory meaning, hopefully on an imputation to imputation basis, and that he would make it very clear to the jury (in fact more than usually clear, bearing in mind that he had already addressed the jury for one and a half hours and that the jury had had the weekend to think about the matter) that the question of truth or falsity is irrelevant to both whether imputations are conveyed and whether they are defamatory. As to the proposed direction that I provided, Mr Evatt liked page one but did not like three paragraphs on page two; Mr Dawson thought page two was acceptable but did not like any of page one. In any event, this direction was one suggestion that I put before the parties, bearing in mind that whether or not that direction was made, it indicated to the parties what I thought would be a suitable direction that would hopefully direct the jury's attention to just how the ordinary reasonable listener would approach the task of determining defamatory meaning.

[17] Mr Dawson submitted that such a correction, coming from me, would simply be "too heavy", and that it was best for him to be left to address the jury. Although this course was opposed by Mr Evatt, this was the course that I followed. I indicated to Mr Dawson that what I would like him to do would be to address the jury on this issue, and that we could then take the morning tea adjournment, in the hope that if there was anything he had left out or overlooked, that would be Mr Evatt's opportunity to use the morning tea adjournment to raise those matters, and they could be fixed up again.

[18] Mr Dawson did address the jury from 11.15 to 11.35 am. On my estimate, the first ten minutes of this was spent on continuing his address from where he left off on Friday, in that he completed the material about "Paul" and then moved on to the third caller, "Colin", without mentioning the matters of concern to Mr Evatt. After that occurred, Mr Dawson turned to the question of the ordinary reasonable listener, and told the jury that, as they were judges, they would need to "draw lines in the sand". He said that they had heard a lot of evidence about Mr Lobsey, whom they now knew quite a lot about from the evidence they had heard; however, Mr Lobsey was not identified as Mr Lobsey in the broadcast because when the caller rang up he said his name was "Les", and Mr Dawson said he did not think "Les" mentioned his name again. (I pause to note this is in fact correct, and "Les" never did mention his name again, because I have checked the transcript of the tape in this regard.)

[19] Mr Dawson said to the jury that they must put from their minds what they knew about Mr Lobsey because the ordinary reasonable listener had no knowledge who Mr Lobsey was, or whether he was a troublemaker, and it was entirely irrelevant to the material broadcast. It was, however, relevant to other questions, such as the damage the plaintiff said the broadcast had caused him, and whether everyone knew who Mr Lobsey was and about his reputation as a troublemaker was relevant to whether the offer was reasonable. This was because if Mr Lobsey had been well-regarded in council, it was more serious for him to have made the allegations, and this was a question for defences and damages. However for the first question in the questionnaire it was necessary to divorce that from the task of deciding what the ordinary reasonable listener gets from the broadcast. He then mentioned how the s 7A procedure used to be done, and said that the circumstances of publication were relevant to what he called "the other question".

[20] Mr Dawson went on to say that the question of truth or falsity was irrelevant to the question of what the broadcast conveyed. It was common ground as to Mr Lobsey that, when he went on air at the radio station, what he said was not true, and that was why there was no defence of truth, but when the ordinary reasonable listener heard the broadcast, he had no knowledge of truth or falsity. He then gave an example of being accused of murder and noted that newspapers say things about which they are not sued, because they were covering criminal trials and what was said was true. Truth or falsity was irrelevant. He then said that he hoped that this was clear to the jury.

[21] He then went on to say it was difficult to separate these things out and in fact he himself had "a couple of times" fallen into error on Friday when he said a couple of times "Les" not "Mr Lobsey". The ordinary reasonable listener did not know "Les" was Mr Lobsey and this must be kept separate.

[22] He then said to the members of the jury that when they were thinking about this, and how they would have reacted, they should remember the ordinary reasonable listener had not been told anything about Mr Lobsey. (I propose to read that last section as if Mr Dawson had said "putting yourself in the shoes of the jury" since that is clearly what he meant.)

[23] After Mr Dawson completed this section of his address, I took the morning tea adjournment. Mr Evatt, unfortunately only after some urging from me to make his position clear, then indicated that he renewed his application to discharge the jury. Mr Evatt submitted that Mr Dawson had essentially continued with his jury address, and that the few words said about truth or falsity, when compared to the length of time spent on Friday and for that matter this morning, as well as the context in which those words had been said had, in Mr Evatt's words, "only made things worse."

[24] Mr Evatt asked me to either discharge the jury or make the direction I had earlier circulated. According to my notes, Mr Dawson did not at the time agree with my direction to the jury and indicated that his preference was that he continue his address to the jury and if, at the end of the submissions, I was of the view that he had not sufficiently clarified this issue, the question of my making a direction to the jury could be considered again. Mr Dawson indicated that he proposed to mention, as he went through each imputation, the obligation of the jury to consider these imputations from the point of view of the ordinary reasonable listener who would have none of the information about Mr Lobsey's identity or whether or not he was known in Quirindi or at the council as a troublemaker.

[25] I then heard extensive submissions from Mr Dawson, and it would be fair to say that if there was any reason I could have found that I felt was possible to continue the trial, I would have done so. One of the solutions proposed by Mr Dawson was to permit him to make a second address to the jury along these lines, another was to commence his address all over again.

[26] I gave these matters very careful thought indeed. However, there are some real difficulties with this course. First of all, after the address to the jury that Mr Dawson gave on Friday; the jury has had the intervening weekend occur, during which time thought processes may have solidified in the jury's mind. Mr Dawson suggested that the jury might have forgotten what he said over the weekend, but I think it is more likely that the jury settled into some understanding of what they thought the issues were, and came to court ready to hear more, and that was certainly how Mr Dawson's address had continued.

[27] In addition to that, every day that the evidence is further away of course is a further day away to a jury not used to the role of being judges of the facts, and it is just that much more difficult for them to go back and look at these issues. To have it drawn to their attention, at the end of a trial and address when they probably feel they have heard nothing but truth and falsity, that this is an issue irrelevant to the first two questions, is very difficult.

[28] Secondly, there is the content of what Mr Dawson said to the jury in his address. With the greatest respect to Mr Dawson, I think that to say he "fell into error a couple of times" by saying "Mr Lobsey" instead of "Les" really did not reflect the gravamen of Mr Evatt's complaint, which also related to his comments about what "Paul" said, what Gary Stewart said, his general comments about troublemakers, and such throwaway lines such as what "Mr Lobsey was saying on air during the interview" (T-511). These were very difficult issues which required in my view a strong explanation about disregarding truth and falsity entirely on these issues.

[29] Mr Dawson has put a number of matters before me. The first of these is that he criticised Mr Evatt's opening by having referred to the fact that the contents of the publication were false, and not having drawn the jury's attention to the fact that, in relation to the test for an ordinary reasonable listener, that they will not know anything about the publication except what is in the publication, and that when they consider the role of the ordinary reasonable listener they must divorce all questions of truth or falsity and also any knowledge they pick up during the trial.

[30] The purpose of an opening address to the jury is to give them a general understanding of the most simple kind. I would be worried if it was a necessary pre-requisite for counsel for the plaintiff, when opening, to be explaining to members of the jury quite complex issues, which the jury need to settle in to the trial in order to take on board. The role of an opening in a defamation jury trial is to introduce the parties. It used to be famously said that all you needed to do then was tell them it was a claim for defamation and sit down. The idea that it is necessary to explain complicated issues of what is in the questions, in my view, is not something which should be a required part of an opening address. If it comes to that, each time that I tell members of a jury at the start of a s 7A trial that they are going to be hearing from counsel about the ordinary reasonable listener and the like, I do not tell them at that time about truth or falsity. In my view, the purpose of an opening is not to explain legal concepts, but to tell them what the case is about.

[31] I now set out the passages of Mr Dawson's address to the jury which are identified during submissions. I will briefly summarise these as follows: (a) At T-511 to 512, there are three mentions of Mr Lobsey. I erroneously during submissions told Mr Evatt were two in number; in fact there are three, between lines 21 to 50. I will set this passage out later.

(b) Mr Evatt took my attention to T-513 lines 5 to about 35.

(c) Mr Evatt particularly drew my attention to T-214 lines 8 to 23. Mr Evatt drew my attention, according to my notes, to the last paragraph on this page.

(d) Page 4: there are six references to Mr Lobsey on page 516. A number of these relate to the s 18 defence, but I note that the statement, for example, at lines 24 to 26 that Mr Lobsey's involvement is relevant to a very important question on the "publications" (in plural) and that is that "everyone on council knew him to be a troublemaker".

(e) I omitted, and Mr Evatt drew my attention to, T-512, where Mr Evatt complained that the point about the example given was that Mr Dawson was "always on about truth" and that in the course of discussing the ordinary reasonable listener to the radio talks about "if Les Lobsey is right". This occurs at T-521 line 22.

(f) Mr Dawson commenced talking about question 1 and whether the imputations were conveyed to the ordinary reasonable listener on T-519. Mr Evatt complained about the reference to "if Les Lobsey is right" at T-521, as I have indicated, and to the references to "Mr Lobsey" on T-524. For example "now Mr Lobsey clearly has been off track because he said "well I have got no idea, maybe the State does". Mr Evatt was particularly concerned, in this part, about this portion of the address going up to T-526 where it is asserted that what Mr Stewart and Hall said is portrayed as right. In other words, there is a sense of truth, and it is bored in where Paul says it is actually the council that appoints the general manager, "that guy calling earlier is wrong".

This is very difficult, because this is actually a quote from the matter complained of, and it needs to be handled fairly carefully. I have some sympathy with the difficulty for Mr Dawson here, but it makes it all the more important that clarity about the task of the ordinary reasonable reader is something that it would have been helpful to have introduced at the beginning of this section.

(g) There are references on T-525 to "Les makes up all this stuff", and too they are saying, "they" that is something that "troublemakers tend to do". What worried me that this is a kind of "flashback" procedure which by inference imported all the information the jury had about falsity, and this is something that it would be important to make sure the jury did not take into account.

(h) The final passage is T-526 to 529, and Mr Evatt spent some time in this, particularly in regard to what he said about "Paul" and the investigator and to statements such as "that is what Paul says - this is why it is not believable that this man has done something wrong." (T-529).

(i) He also complained about T-527 line 27 about the investigator and to the passage at the bottom of T-527 where in the course of discussing imputations Mr Dawson says:

"Now Mr Hunt takes that very personally and I don't criticise him. You can understand why having had Mr Lobsey go on air and say he's a lowlife, you can understand why the broadcast isn't going to sit very well with him. It wouldn't sit well with any of us. But what Mr Stewart doesn't do at the end is sink the boot in or rub salt in the wound; what he's doing is he's ridiculing Mr Lobsey to an extent and more so the investigator for not having any substance to the complaints. So that's the way I would invite you to think about it as the ordinary reasonable listeners' interpretation of it.

But if we go to the call that Paul makes. He comes on just after Mr Stewart comes back. There's obviously a break or maybe there's one of those commercial breaks or something, I don't know, but there's obviously something that happens between the two calls, and what Mr Stewart says - and this is where I think he says "if" members of the jury, and I think that was reasonably clear on the CD, he says not from a corruption point of view or from a improper conduct point of view but from a business point of view, just as a financial proposition, Robert Hunt may not have done the best thing if he's approved a development and purchased 44 homes ..(not transcribable).. that's 47 built, 47 empty. He hasn't done himself much of a favour, hello Paul.

On he comes. Paul clarify's he's the general manager and says, yeah, well that's appointed by the counsellors and normally they get a five year contract. Well, Paul actually sounds like he knows what he's talking about on that topic."

[32] A lot of these references, if they had been put in context of the ordinary reasonable reader might think he is drawing them only from the matter complained of, would be correct, but by this time, unless there is a passage to which I have not been taken (which I think is unlikely), the jury was still not being addressed as to truth and falsity being irrelevant, or as to not taking into account all of this material that they heard which was relevant to the defence of offer of amends and whether the offer was reasonable.

[33] I have been backwards and forwards over this transcript, and I can see some faint hints, but the standard statements that have become part of the standard s 7A addressed to the jury about the ordinary reasonable reader disregarding issues of truth and falsity have not been made. These statements have been a part of jury addresses since the Court of Appeal dismissed an appeal from the trial judge's refusal to discharge a jury where Mr Littlemore QC told the jury they were not concerned with truth or falsity (Nationwide News Pty Ltd v Aitken [2004] NSWCA 311).

[34] As these page numbers indicate, the references complained about commenced shortly after Mr Dawson's address to the jury, at T-509 and finish at the end (T-529). Another of the problems s that the objection effectively covers matters raised for the whole of the address to the jury.

[35] I shall briefly set out the precise passages of some of these sections as follows (at T-511 line 21 to T-512 line 15): "There is often in a defamation case and this one is no different, a dispute between the plaintiff and the defendant about what the publication actually means. And quite often you can imagine why a person in Mr Hunt's position would take more serious meanings away from a broadcast about him then an ordinary person would assessing it objectively and with an objective mind. We are all, and it's part of the human condition, sensitive to things that are said about us if they are critical. And I don't suggest for a second that what Mr Lobsey was saying on air during the interview on 30 June last year wasn't in some way derogatory of Mr Hunt.

Plainly Mr Lobsey was, and it's a phrase I've probably used too often but plainly he was stirring up trouble about Mr Hunt. And he was, to use Mr Burke's words, having a whinge about local politics but he was having a go at Mr Hunt and that's not in dispute. But the question for you is did the ordinary listener when he or she heard that, and I'll come to explain who this mythical ordinary reasonable listener person is in a minute, but did the ordinary reasonable listener when he or she heard that take away from it the meanings that Mr Hunt asks you to accept were conveyed? And one of the things I'll be saying to you is that those meanings actually cast the case way too high.

At the end of it all as Mr Burke has said in the witness box you may well be persuaded that on balance the ordinary reasonable listener actually comes away from that broadcast with an impression that Mr Lobsey is a bit of a problem and has a bit of an issue with Mr Hunt but he's probably not somebody to be taken terribly seriously, particularly in light of the caller Paul who rings up and says "Well as if anyone in that position would be that silly".

You may however not be persuaded about that. You may have the view that by the end of the three phone calls there is an impression that's negative about Mr Hunt left in the mind of the ordinary listener. And that's not an irrational view. I'm not saying to you members of the jury that it would be irrational for you to think that the ordinary listener would come away with some negative impression, that's entirely possible. The question is is it the impression or is it the specific meanings that Mr Hunt claims I the questions that are before you?

So that's why Mr Ashford is saying quite frankly and honestly from the witness box well he regarded the broadcast as defamatory. It doesn't mean that that's the beginning and the end of it. It may be defamatory to say, to use an example, that the police suspect Sandy Dawson of murder. That's defamatory of me because people are going to think well police have got a reason to think he killed somebody. But you can see how it's much more defamatory if the publication about me being charged goes on to suggest that I actually did kill somebody. Being suspected of murder by the police is a serious thing to say about somebody but to say that somebody actually in fact did commit the murder is a much more serious thing to say."

[36] Mr Dawson submitted to me that at lines 31-39 on this extract he had in fact reinforced these issues of the ordinary reasonable listener only listening to the broadcast, but while he may have meant to do so, I do not think that this would be clear to members of the jury needing to have this explained to them.

[37] The references to Mr Lobsey by the man Mr Lobsey, especially in context "stirring up trouble", a phrase which as Mr Dawson says is "a phrase I've probably used too often", (this being a reference to evidence about Mr Lobsey for the "reasonableness" part of the s 18 defence) are not matters which the ordinary reasonable listeners even in the Quirindi district, let alone the twenty other radio broadcasting stations, would have known about.

[38] The limited circumstances in which a plaintiff may seek changes of meanings by way of extrinsic facts need not be repeated here. The entitlement of a defendant to insert an imputation that is otherwise not conveyed or not defamatory by reasons of extrinsic facts would be a novel contention, and not one that I understand to have been put here.

[39] At T-512 where Mr Dawson turns to the third issue, namely the defence of offer of amends. No delineation is made to the effect that it is in relation to this section that these issues of "Mr Lobsey" and falsity are be considered, Mr Dawson explains that if one or more of the imputations is found to be both conveyed and defamatory then the jury considers the defence of offer of amends. Mr Dawson in this context refers to Mr Lobsey twice by his surname, which is acceptable in relation to this defence, but of course is a continuation of what done before. Mr Lobsey is speaking "utter, utter untruths" which he must have known to be untrue as did the plaintiff and his witnesses (T-513) and as soon as Mr McGarry heard Mr Lobsey's voice he knew it was going to be ridiculous.

[40] Immediately after these two references to "Mr Lobsey" at lines 9 and 15, Mr Dawson began at line 29 to "walk" the jury through the questions for the jury (T-513 line 29). At T-514 line 8 he refers to council saying that there was probably "no damage at all that was caused by that because of what we know about Mr Lobsey and his reputation within counsel" at T-48 to 49 he says Radio 2SM should not be held responsible for just the Les interview being sent around to council "because it takes the broadcast a bit out of context and because what Paul Seers says is "a bit of an antidote" to what Les has said. This is where some of the passages objected to by Mr Evatt would tie in. Mr Dawson at T-515 refers to the limited publication and the fact that this was broadcast on the "graveyard shift" (T-515), and that another thing to take into account was it was Mr Lobsey who made the allegations, referring a number of times to Mr Lobsey by name and noting that there was a pretty good chance Mr Lobsey was regarded throughout Quirindi as a trouble maker, but adding that he "could not responsibly suggest that Mr Lobsey was known across New South Wales as a trouble maker" and that if he had been, the amount offered could have been less. (The offer was made to take into account the fact that Mr Lobsey was, on Mr Burke's inquiries known as a bit of a trouble maker.)

[41] Mr Dawson went on to say (at T-516 lines 21-33): "And anyone who didn't know him, having heard caller Paul ring in would probably think, "That bloke's obviously got a bee in his bonnet, I wont' take what he says too seriously." But of course, Mr Lobsey's involvement is relevant to a very important question on the publications and that is that everyone in council knew him to be a troublemaker.

Mr Hunt's email of 30 June, you'll remember, is an email that doesn't even mention that it's Mr Lobsey on the broadcast and that's because, as he said to you in his evidence, everyone would recognise Mr Lobsey's voice straightaway. And indeed Mr McGarry did and the Mayor did and anybody else who heard it did. So that's another one of the circumstances that you'll take into account as is the nature of the broadcast."

[42] The next part of Mr Dawson's address related to burden of proof and the role of the jury, and to comparing issues in the case to hurdles, referring to some famous cases in the newspaper. He then played the tape to the jury and asked them to take into account that this was an overnight sort of radio program where lonely people ring up and chat. He says, at paragraph 2, there is a word missing (at T-521 line 15): "You know when Mr Stewart comes back on for the call from Paul's, page 9 paragraph 72, I want to suggest to you that there's a word missing on the transcript which is when Mr Stewart comes back on he says:

"From a business point of view, Robert Hunt may not have done the best thing if he's approved a development and he's purchased 44 homes now" et cetera.

In other words if he's done this, if Les Lobsey's right, well that doesn't sound like a very good business proposition, because they're not selling. So I would invite you to just think about whether you think the word "if" is there. I have to say listening to it, that's what I think is said, but as her Honour said this is a question for you.".

[43] This is one of the references to "Les" as "Les Lobsey". It is not the only one but it is, I think, a problem, because importing the name "Les Lobsey" as being relevant during discussion of capacity and defamatory meaning there is a risk of conflation of the issues.

[44] Mr Dawson read to the jury out of the transcript; I note that at T-522 and following, there are a number of references to "Les" where Mr Dawson is actually reading this out from the transcript which says "the caller Les" (at T-524 lines 5 to 52): "Mr Stewart's immediate reaction is "Well hang on a minute, you saying he's overriding the councillors, well who appoints him?". In other words the Council. Now Mr Lobsey clearly has been off track because he says "Well I've got no idea, maybe the State does".

He suddenly realises that he hasn't actually worked out who appoints the general manager which is a pretty important point you might think if you're saying that he's overriding the Council and we'll just pause there, remember that when Paul rings in, one of the first things he says is 'Look it's actually the Council that appoints the general manager. That guy calling earlier is wrong, it's not the State, it's the Council that appoints him". So immediately the idea that Mr Hunt has got the ability to override Council is blown up into smitherines. And then what does Mr Stewart do from 29 onwards?

He starts to drill into the detail a little bit, not to egg Mr Lobsey on I would suggest but he starts drilling into him by asking "Well let's just find out about this man Mr Hunt that you say has got too much power. How long has he been around? Ten years". Immediately Mr Stewart says "Righto, well he's obviously - he knows enough about the area to know what he's talking about. In other words the man's got credibility, he runs on the board". Les has to agree with that. And then this is actually a pretty big challenge you might think members of the jury when Mr Stewart says "Well you're just disappointed because he's got his finger on the pulse, he knows what he's doing and hearsay is the be all and end all because he's got the experience, he's got the power, he knows what he's doing and he's been around for a while".

And then Les changes tack and says "oh well yeah but hang on he won't listen to ratepayers"."

[45] Mr Dawson's use of "Mr Lobsey" is interspersed with "Les", following which he says at T-525 line 7: "and then Les makes up all this stuff" and goes on to say "he's sounding a little bit unhinged at this point you might think." Again there is the difficulty of the references to Mr Lobsey and Les being interspersed, as well as the reference to "as troublemakers tend to" which, if there had been an explanation to the jury about how to go about their tasks, would not have been so difficult.

[46] Mr Evatt objected at some length to the passage on T-526 about the investment being a terrible proposition which Mr Dawson would "come to" later, and indeed he does in line 19, as "this terrible business proposition". This may well be legitimate comment on material in the broadcast rather than a reference to truth or falsity, but without the benefit of an offsetting explanation, it is a problem. I note there is another reference to "egging Mr Lobsey on" and this is a reference to Mr Lobsey in relation to question 1. This is at T-524.

[47] I have already referred to the portion at the bottom of T-527, so I will not set it out again. It is a problem that this passage, in relation to really a damages issue, has crept into the submissions on defamatory meaning. There are two references to Les as "Mr Lobsey", and we are told that he invites the jury to think about it as the ordinary reasonable listener's interpretation of it. He then returns to the call that "Paul" makes, and this is one of the passages Mr Evatt was particularly indignant about, as I have already indicated. Mr Evatt also objects to the portion at the top of p 529 where Mr Dawson said "then what Paul says is - this is why it's not believable that this man has done something wrong". He also referred to the statements in the third paragraph on this page, notably the sentence "Gary Stewart reinforces the fact that it's a big financial commitment" and to what is said about what Paul said at lines 32-35 and again at 40-41.

[48] It is accepted by everyone in this courtroom that the ordinary reasonable reader who reads the matter complained of, with certain very limited exceptions none of which occur here, does not know more than what is contained in the matter complained of, and that any submission which appeared to infer that the recipient would not be likely to believe in it or in fact did not belief in it, would be irrelevant. The law on this subject has been helpfully summarised by Professor Raymond E Brown (The Law of Defamation in Canada (2nd ed.) at 5.5(1)(b), where Professor Brown sets out the principles and, in footnote 550, refers in particular to the statement to this effect by Lord Morris in Morgan v Odhams Press Ltd [1971] 2 All ER 1156; [1971] 1 WLR 1239: "It was submitted that if defamatory words concerning A are published to B who refuses to believe that the words are true, then A would have no cause of action. I consider that such a contention is completely fallacious. Apart from any question affecting the measure of damages A's rights would be unaffected by the circumstances that B in fact disbelieved the words."

[49] Professor Brown goes on to note in footnote 531 that if imputations are not to be taken seriously, that might however be relevant to one defence, namely unlikelihood of harm although, as the Court of Appeal pointed out in Jones v Sutton (2004) 61 NSWLR 614; [2004] NSWCA 439, actual knowledge of untruth may still not be sufficient.

[50] The irrelevance of whether the recipient actually knew it to be untrue is as Hunt J explained in Barbaro v Amalgamated Television Services Pty Ltd (1985) 1 NSWLR 30 at 37; (1985) Aust Torts Reports 80-698, where his Honour said: "The knowledge that what was said of the plaintiff was false does not mean that the defamatory imputation was not conveyed (and thus published) to that person in relation to the plaintiff. The meaning which is in fact conveyed is that which the ordinary reasonable reader (or viewer) would have understood, from what was published, was the meaning intended by the author: Hepburn v TCN Channel Nine Pty Ltd [1983] 2 NSWLR 664 at 667.

Knowledge on the part of the readers (or viewers) that the assertion concerning the plaintiff was false is, of course, very relevant to the issue of damages. But it is not relevant to the issue of publication."

[51] Where questions of truth or falsity have been raised in s 7A trials, which of course relate to the same issue that is before me now, namely what addresses should be made to a jury in relation to imputations and defamatory meaning, applications to discharge the jury have been brought, and whether they are successful or not depends on the degree of the problem. In Phelps v Nationwide News Pty Ltd [2003] NSWSC 1104, counsel for the plaintiff referred to Dr Phelps as someone who was "often the subject of publicity in the media" and to the journalists as a "very well known journalist". This was where a claim was made that Dr Phelps was the AMA's barrel girl. Miles J refused the application. Another example of the jury being told something which was asserted might amount to truth or falsity occurred when a jury was told by counsel that they need not worry about whether another imputation was conveyed because it was the subject of another jury finding. This occurred in the second jury trial in Harvey v John Fairfax Publications Pty Ltd [2004] NSWSC 188. Levine J, in his judgment of 19 August 2004, considered that this submission was understandable, in light of the highly artificial nature of the s 7A trial, where this had to be explained to the jury.

[52] In Strasberg v Westfield Ltd [2003] NSWSC 1021 there was a somewhat clumsy attempt to delineate between the irrelevance of truth and falsity to imputations in a defamation case, when there was another claim before the jury to which it was relevant. In fact that case is an indication of the same kind of problem that occurs here. At [13]-[14] Levine J said he could cure this by a direction to the jury that truth or falsity was, as it happened, irrelevant to the other cause of action, namely false imprisonment. However that was a case, not where an alternative submission had been made, but where a submission about irrelevance of truth and falsity to the imputation was contrasted wrongly with its asserted relevance to false imprisonment.

[53] A case that is also in point is Halbish v John Fairfax & Sons Pty Ltd (Supreme Court of NSW, Newman J, 17 February 2000, unreported) where Newman J discharged the jury when counsel for the plaintiff in the course of explaining the bifurcated s 7A trial told the jury that they would not be hearing evidence from the plaintiff, but that the plaintiff's case was imputations were published without lawful excuse. Newman J considered no direction to the jury to disregard truth or falsity could cure this statement.

[54] An application was brought in Mirror Newspapers Ltd v World Hosts Pty Ltd (1979) 141 CLR 632; (1979) 23 ALR 167; (1979) 53 ALJR 243 to discharge the jury on the basis that the plaintiff led extrinsic evidence, namely identification evidence. The trial judge's refusal to discharge the jury was upheld in the Court of Appeal and the High Court, but that was because the court held that this evidence was not in fact extrinsic evidence.

[55] Implicit in these judgments is the fact that parties cannot have recourse to material outside the matter complained of other than in the very narrow exceptions of true innuendo or notorious fact. A good example of a notorious fact is that Kevin Rudd is the Prime Minister, and in fact he is referred to, as only "Kevin Rudd", in the matters complained of. That would not be a problem, if an imputation arose by reason of knowledge that he is the Prime Minister. However, a reference to "Les" as Mr Lobsey, in the absence of a careful explanation to the jury, and in circumstances where there is other evidence as to the truth or falsity of what Mr Lobsey says that will need to be put to one side, does create such a difficulty.

[56] An example of a jury discharge involving a kind of extrinsic fact (namely the presumption of innocence), in the context of issues of truth or falsity, occurred in John Fairfax Publications Pty Ltd v Obeid (2005) 64 NSWLR 485; [2005] NSWCA 60. McColl JA (and I have been greatly assisted by her Honour's very careful analysis of the obligation of judges in such circumstances) said at [34]: "[34] His Honour's view was that the presumption of innocence submission was sufficient to warrant the discharge of the jury on the basis that no direction could cure the prejudice flowing from it or the prejudice which could arise if he sought to correct. He said (at [14]):

"[14] If that was the only ground it would be sufficient because I would be persuaded that what I would have to say to the jury negatives such a substantial component of Senior Counsel for the defendant's address, that prejudice could arise not merely vis à vis the defendant thereby, but by reason of the provocation of a misguided sympathy towards the defendant, also against the plaintiff."

[57] I have carefully reviewed all of the decisions of the New South Wales Court of Appeal and Supreme Court and High Court in relation to discharges of juries. There may be some to which I have not referred but I have taken very much to heart the warnings and admonitions of appellate courts and the need for me to exercise this power with the utmost of care. One of those cases is Yoon Shin Lee v Bob Chae-Sang Cha [2005] NSWCA 279 where one of the issues, although it was very much a subsidiary issue, was the naming of a Mr Lee. There are differing views on this in the judgments of Bryson JA and Campbell AJA. Bryson JA assumed that this was a statement of an identifying nature concerning Mr Wheelhouse SC's client, made at the commencement of the trial although it was in fact a statement during counsel's address. The problem was, as Campbell AJA noted at [146], that this was a case where what was asserted was that the Mr Lee who was sued as a publisher was different to the Mr Lee who was referred to in the matter complained of. It was being asserted by counsel for Mr Lee, the publisher, that his client had not authorised the publication. One of the statements he made in his address to the jury was that the readers would have known that Mr Lee who was sued as publisher was a different person to the Mr Lee in the matter complained of. In Yoon Shin Lee v Bob Chae-Sang Cha, there were, however, other reasons for the discharge of the jury.

[58] There are decisions of the Court of Appeal where appeals were dismissed from refusals to have juries discharged because of language, three which involve Mr Littlemore, whose linguistic dexterity is apparently the subject of dismay to his opponents. I note in particular Lane v Reid [2005] NSWCA 198; Nationwide News Pty Ltd v Noriega [2004] NSWCA 420 and Nationwide News Pty Ltd v Aitken [2004] NSWCA 311. Those decisions were not of assistance on this issue.

[59] In considering the decision as to whether or not to discharge the jury, I have taken into account that jurors are resilient people. They are not frightened by strong questions or answers in cross-examination. They are not worried about hearing things three or four times. They are in general considerably wiser than we give them credit for, and they bring an active sense of the civic duties that they have, and a willingness to listen, and for that matter to be told to forget about or to re-visit matters that they have already been told about.

[60] There are other problems when considering whether there is any alternative to a discharge, and these have been touched on in the submissions today. The first is the claim by Mr Evatt of additional length of the trial, which I do not count as a significant feature at all. I think the jury would be happy to sit there and come to a decision, and would probably prefer, in some ways, to being sent away. The real difficulty is that if Mr Dawson could start again, as was one of his suggestions, or make a second correction, this creates unfairness for both parties. Mr Dawson gets a double address (or a double serve, in that he may then get a direction from me). There is an additional requirement for me to deal at length with these matters, in the circumstances of a trial which is already complicated. In relation to the timing, it may have made a slight difference if Mr Dawson had said this on Thursday and I had been able to deal with this on Friday (or better still Monday and Tuesday) rather than the following week, but this is a minor point.

[61] The ability to cure the prejudice fundamentally is a matter of impression. I have thought long and hard about this very difficult issue and if there had been any way to avoid discharge of the jury I would have taken it. I think if Mr Dawson's address had dealt in a stronger and, I will not say franker, but more critical, way about the necessary test for the ordinary reasonable reader and what they read and the relevance of truth and falsity and the like that the prejudice, whether or not it had been cured, the parts of his address which conflated issues would have been ameliorated sufficiently. It certainly would have been good enough for me as the trial judge in circumstances where I was keen to get the trial on. However, I am of the view that the problem cannot be addressed by any further correction by Mr Dawson, simply because I think it is just too late, and there must come a time when the court has to decide that there really is nothing more that can be done.

[62] One matter on which I did put very slight weight is that if these were proceedings where a defence of truth or qualified privilege had been pleaded and there was a trial of many weeks I might have been more reluctant to discharge the jury. This is a case where the defence of offer of amends is a defence in a slightly different category to these defences, in that it is a little more analogous to a s 7A jury trial. In the jury discharge decisions of Levine J, one of the factors his Honour has taken into account in s 7A jury trials has been that it is "a mini-trial", so to speak. This is not a mini-trial, it is closer to a defence of qualified privilege or comment, and in my view should be treated more like a trial where there is such a defence than a s 7A trial. Only a very small degree of weight can be given to that factor.

[63] This brings me to the issue of costs. In Steele v Mirror Newspapers Ltd [1975] 2 NSWLR 48, the costs were ordered to abide the second trial, but that related to the circumstances in which the orders were made. In Morgan v John Fairfax & Sons Ltd (1988) 13 NSWLR 208 an order for costs made in the first trial was set aside on appeal, but then that was set aside by the Court of Appeal in the second appeal: Morgan v John Fairfax & Sons Ltd (1990) 20 NSWLR 511. In Yoon Shin Lee v Bob Chae-Sang Cha [2005] NSWCA 279 an appeal from the discharge of a jury (and consequential costs order) was dismissed. In Monie v Commonwealth of Australia (No 2) [2008] NSWCA 15 at [55] - [60] the Court of Appeal explained the circumstances in which costs should not await the further hearing of the trial, and those considerations are relevant to the circumstances in this case.

[64] The present situation is that costs are governed by the Civil Procedure Act 2005 (NSW) and I must have regard to ss 56 to 62. I raised with the parties what would happen with these proceedings, bearing in mind that I considered it was inappropriate that I should delay the hearing of this matter as it was certain that the defendant will seek leave to appeal from the decision I gave, refusing to disqualify myself. I raised with the parties whether an application to transfer the matter to the Supreme Court would be made. That is because this court's facilities for hearing jury trials and defamation actions is extremely limited.

[65] This is the first defamation jury trial to take place in this court and frankly strains the resources of this court, including the availability of daily transcript, the ability of this court to sit in matters that run over and the general difficulties of conducting jury trials, are considerable. Just to give one practical example, Supreme Court judges have a tipstaff who can assist with the jury. This is not possible here, and this means that my court officer has to look after a jury as well as be a court attendant. There are other burdens, and indeed I question whether it might not be appropriate for defamation jury trials generally to be heard in the Supreme Court, where there are better facilities. This would mean that parties who wanted to requisition a jury trial would simply apply to the Supreme Court and have it heard in the Supreme Court, and this court could hear matters where there was not a jury, which would be an appropriate division of labour. Where a party seeks vindication of his reputation and wants a jury, the proceedings could be brought in the Supreme Court or, for that matter, having regard to the recent decision of Rares J in Ra v Nationwide News Pty Ltd [2009] FCA 1308, in the Federal Court if appropriate.

[66] One order I do propose to make is that the parties should go to mediation. Indeed that is a matter that, in my view, ought to be compulsory in every case where a defence of offer of amends is pleaded.

[67] It is now nearly 4 o'clock and I shall quickly summarise the issues in relation to costs. The circumstances in which costs follow the event apply to all matters, including discharge of a jury. I am not aware of any cases suggesting that the court's powers under s 98 have any specific limitation. Section 98 Civil Procedure Act 2005 (NSW) creates a wide discretionary power and there are circumstances in which costs orders could be reserved as opposed to costs generally following the event. However in circumstances where this case is likely to be heard in the Supreme Court, to be leaving it to a judge in another court to go through the transcript and work out whether or not such an order should or should not have been made by the trial judge is imposing a very great burden on that judge, especially in circumstances where, costs being an interlocutory matter, an application can be brought to set aside that order or, for that matter, to seek leave to appeal from it.

[68] Accordingly I am of the view that the appropriate order that I should make is for costs to follow the event, and I propose to make an order that the defendant pay the plaintiff's costs of the application to discharge and of the trial.

[69] The orders I make are as follows: (1) Jury discharged. (2) Exhibits remain with the file until further order. (3) Leave to the plaintiff to uplift Exhibit K. (4) Parties are to attend mediation and while the matter remains in the District Court, no further steps may be taken in this litigation until the parties can satisfy the court that they have each taken such reasonable steps to have this matter mediated as may be considered appropriate by the proper officer of the ADR Centre 233 Macquarie Street, Sydney. (5) As an exception to order 4 above, leave to the plaintiff to file an Amended Statement of Claim in 21 days and a defence 21 days thereafter. (6) The defendant pay the plaintiff's costs of the application to discharge and of the trial. (7) Note: The parties have indicated an agreement that the matter be transferred to the Supreme Court and will seek orders from the Supreme Court accordingly.

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