Kermode v Fairfax Media Publications Pty Ltd

Judgment 1This is an action for defamation arising out of the publication of an article in the Sydney Morning Herald newspaper, similar material published on the website for that newspaper and another newspaper's website and a video clip appearing on the Herald website. An earlier interlocutory application in the proceedings (not relevant to the present application) was determined by Simpson J: Kermode v Fairfax [2010] NSWSC 852. The application presently before the Court concerns the plaintiff's interrogatories to the defendants.

Background 2The plaintiff relies upon two imputations alleged to have been conveyed by the matters complained of (one in the alternative): (a) that the plaintiff had obtained a $20 million windfall for his companies by improperly influencing public servants and politicians in his favour by conferring benefits upon them; (b) alternatively to (a), that the plaintiff had attempted improperly to influence public servants and politicians in his favour by conferring benefits upon them. 3The same imputations are relied upon in respect of each matter complained of. 4The defendants to the action are the publisher of the printed version of the newspaper (the first defendant), the publisher of the internet version of the newspaper and an internet newspaper in Queensland also alleged to have published one of the matters complained of (the second defendant) and Mr Linton Besser, the journalist under whose by-line the articles were published (the third defendant). 5By their amended defence filed 24 August 2010, the defendants have pleaded, among other defences, the defence of honest opinion under section 31 of the Defamation Act 2005 . That section relevantly provides: 31 Defences of honest opinion (1) It is a defence to the publication of defamatory matter if the defendant proves that: (a) the matter was an expression of opinion of the defendant rather than a statement of fact, and (b) the opinion related to a matter of public interest, and (c) the opinion is based on proper material. (2) It is a defence to the publication of defamatory matter if the defendant proves that: (a) the matter was an expression of opinion of an employee or agent of the defendant rather than a statement of fact, and (b) the opinion related to a matter of public interest, and (c) the opinion is based on proper material. 6The defence is pleaded by the defendants in the following terms (paragraph 14 of the amended defence): In the further and alternative answer to the whole of the Statement of Claim, the Defendant (sic) says in respect of the matters complained of in paragraphs 4, 6 and 8: (a) such matter complained was an expression of opinion; (b) such opinion was based on proper material and on no other material or, alternatively, was based to some extent on proper material and represented an opinion which might reasonably be based on that material to the extent to which it was proper material; (c) the opinion related to a matter of public interest; (d) the opinion was an expression of opinion of the Defendant or, an employee or agent of the Defendant, being the Third Defendant. 7The defence as pleaded does not differentiate between defendants. Section 31 in fact creates three separate defences of which two are invoked in the present case, namely, honest opinion of the defendant (section 31(1)) and honest opinion of an employee or agent of the defendant (section 31(2)). Accordingly, the appropriate course would have been for the defence of each defendant to be pleaded separately (that is, in separate paragraphs within the same pleading). The determination of the issues raised by the present application is not precluded by that difficulty but it should be rectified in due course. 8T he plaintiff pleads defeasance of those defences ( paragraph 8 of the reply filed 21 January 2010) , invoking section 31(4) of the Act , which relevantly provides: (4) A defence established under this section is defeated if, and only if, the plaintiff proves that: (a) in the case of a defence under subsection (1)--the opinion was not honestly held by the defendant at the time the defamatory matter was published, or (b) in the case of a defence under subsection (2)--the defendant did not believe that the opinion was honestly held by the employee or agent at the time the defamatory matter was published... 9Accordingly, the plaintiff has assumed the burden of proving the following issues of fact raised on the pleadings: (a) as to each defendant contending that the matter complained of was an expression of his or its own opinion, that the opinion was not honestly held by that defendant at the time the matter was published; (b) as to each of the corporate defendants contending that the matter complained of was an expression of opinion by Linton Besser, that that corporate defendant did not believe that the opinion was honestly held by Mr Besser at the time the matter complained of was published. 10Separately, the defendants have pleaded the common law defence of fair comment and the plaintiff has pleaded, by way of defeasance to that defence, that any such comment was not fair in the sense that a fair minded person could not hold the opinion (paragraph 15 of the amended defence and paragraph 9 of the reply). 11The present dispute concerns a number of interrogatories pressed in aid of the proof of the issues of fact set out above. The principles to be applied in determining whether a party should be directed to answer a disputed interrogatory are well-known and need not be rehearsed in this judgment. 12As to the first defendant, the disputed interrogatories are numbered 17 and 28 to 31, as follows: 17 What information did the first defendant have, at the time the first matter complained of was published, as to whether Linton Besser held the opinions he expressed in the first matter complained of? 28 At the time of publication of the first matter complained of did the first defendant have any information with respect to any of the material in the first matter complained of? 29 If the answer to the preceding interrogatory is in the affirmative: (a) state what information the first defendant had; (b) who or what was the source of the information (identify specifically what information); (c) identify all documents containing such information which the first defendant had in the first defendant's possession at the time of the publication of the first matter complained of; (d) identify all documents containing such information as to which the first defendant had been informed of their contents or parts thereof but which the first defendant did not have in the first defendant's possession at the time of publication of the first matter complained of and provide a complete description as to the terms by which these documents were described to the first defendant. (e) state the use made of each of the documents described or referred to in (c) and (d) above; (f) identify any such information which consisted of an oral communication and state the substance of what was said by each such person; (g) identify all matters of past experience and background or of contemporary history or notoriety and anything else relating to the first matter complained of which occurred to the first defendant prior to its publication. 30 In respect of each source of information for the first matter complained of (specifying each source) at the time of publication of the first matter complained of, did the first defendant have a view as to: (a) the nature and/or quality of the information furnished by the source; (b) the accuracy of the information furnished by the source; (c) whether the source was biased against Mr Kermode; (d) whether information furnished by the source required corroboration? 31 If the answer to the preceding interrogatory is in the affirmative as to any part, in respect of each such part (specifying it): (a) what was that view; (b) on what facts, matters and circumstances was the view based; (c) when precisely was that view formed? 13Similar interrogatories have been directed to the second and third defendants. The argument before me proceeded on the basis that the plaintiff's entitlement to have answers to those interrogatories would follow the fate of those directed to the first defendant. 14The defendants object that answers to those interrogatories are not reasonably necessary for fairly disposing of the proceedings. As to interrogatory 17, Mr Polden, who appeared for the defendants, noted that the matter to be proved by the plaintiff in defeasance of the defence under section 31(2) is that the first defendant did not believe that Mr Besser honestly held the relevant opinion (Mr Polden's emphasis). I note in passing that Mr Polden's submissions expressed the issue by reference to "the opinion represented by the imputations". Section 31, however, is directed to the matter complained of, not the imputations. 15The defendants submitted that the interrogatories now pressed do not go to that issue but only to the factual substratum of any belief which the defendant held. It was submitted that the factual substratum of the belief forms no part of the matter of defeasance under section 31(4)(b) and, further, that the interrogatories are incapable of eliciting a clear admission which is not ambiguous or confusing or which would be of any utility in narrowing the issues for trial. 16Separately, it was objected that the interrogatories seek details of information pertaining to confidential sources, contrary to the "newspaper rule": see John Fairfax & Sons Ltd v Cojuangco [1988] HCA 54; (1988) 165 CLR 346. In response to that discrete objection, it was indicated on behalf of the plaintiff that he does not seek disclosure of any such sources, but seeks a verified answer to establish the existence of a claim in that respect. In my view, that is the appropriate procedure in the circumstances. 17As to interrogatories 28 to 31, the defendants submitted that the interrogatories are an expanded version of the interrogatories approved in Palmer v John Fairfax & Sons Ltd (1986) 5 NSWLR 727. It was noted that such interrogatories are directed to a defence of qualified privilege under section 22 of the Defamation Act 1974. No defence of qualified privilege has been pleaded in the present case. Mr Polden submitted that the court should not depart from the settled practice in the Defamation List, which recognises that such interrogatories are directed to a defence of qualified privilege, not to a defence of comment or honest opinion. In support of that submission, he relied upon the decision of Hunt J in Howard v Nationwide Publishing Services Pty Limited (Supreme Court of New South Wales, Hunt J, 26 February 1987, unreported). 18In that case, Hunt J said: When a party strays from the normal, well accepted form of interrogatory he usually has to justify the departure, insofar as by that departure the interrogatory seeks information beyond that sought be an interrogatory in the normal form. 19Plainly, there is good sense in practitioners following a form of interrogatory that has been approved by the court as being permissible and appropriate in accordance with the relevant principles. However, as noted by Simpson J in Cotter v John Fairfax Publications Pty Ltd [2001] NSWSC 587 at [27], interrogatories in defamation proceedings are not fossils set in amber. I do not think that the remarks of Hunt J in Howard should be construed as a discouragement to thoughtful analysis of the real issues in dispute and expedient means of their proof at trial. Such analysis in the present case has brought the plaintiff's legal representatives to the conclusion that the "information interrogatories" are necessary (as that term is comprehended in the principles relating to interrogatories). 20Mr Smark noted that the matter of defeasance provided for in section 31(4) of the 2005 Act raises considerations for plaintiffs that have not previously arisen. It is clear enough that the matter of defeasance raises an issue as to the defendant's state of mind, be it an issue whether the defendant himself held a certain opinion or whether he believed that his employee or agent held that opinion. Mr Smark submitted that where a person's state of mind is in issue, "everything relating to the subject in question which came to the notice of the person whose state of mind is relevant becomes admissible to establish that state of mind", citing Seidler v John Fairfax & Sons Ltd [1983] 2 NSWLR 390 at 393F-394B. 21Separately, Mr Smark relied on some older English authorities concerning interrogatories directed to the common law defence of comment. In Plymouth Mutual Co-operative & Industrial Society Ltd v Traders' Publishing Association Ltd [1906] 1 KB 403, the English Court of Appeal considered interrogatories similar to those pressed in the present case where a defence of fair comment had been raised. The interrogatories in question sought the information held by the defendant at the time of publication, the steps the defendant had taken to test that information and the sources from whom it had been obtained. Vaughan Williams LJ noted that the case raised a defence of fair comment rather than privilege and noted that the former raised the issue of the fairness of the comment. After noting that such interrogatories were relevant to a defence of qualified privilege, His Lordship said (at 413.7): "[it] seems... just as relevant and admissible in a case where the defence is fair comment as in one where it is privilege. In either case the question raised in really as to the state of mind of the defendant when he published the alleged libel, the question being in the one case whether he published it is in the spirit of malice, in the other whether he published it is in the spirit of unfairness." 22As is conceded in the present case, his Lordship held that the publisher should not be required to identify its sources. 23The decision in Plymouth was followed by the English Court of Appeal in Lyle-Samuel v Odhams Ld [1920] 1 KB 135 at 140.2. 24Mr Smark submitted that the plaintiff is entitled not only to ask the proposition raised by section 31(4) (whether the defendant held the opinion or belief in question) but also to test the proposition. In my view, there is force in that submission. Although the question raised by the defence of qualified privilege may be broader, entailing (at least in some instances) the objective question of the reasonableness of the conduct of the publisher, both defences invite scrutiny of the defendant's state of mind. As noted by Simpson J in Cotter at [10] (albeit in a different context), where the state of mind of the defendant is the fact in issue, interrogatories may well be the only avenue by which the plaintiff can obtain relevant information before the trial. 25I am satisfied that, as a matter of principle, the plaintiff is entitled to the answers sought. Plainly, the plaintiff would be entitled at trial to cross-examine the defendants as to the information they held and the steps taken by them to establish its reliability, so as to test the evidence in chief as to the relevant beliefs and opinions. The information interrogatories are plainly relevant to the task of assessing and testing such evidence. 26Further, in my view, the present interrogatories may well facilitate the efficient conduct of the trial by having the matters raised explored in advance. For that reason, I am reinforced in the conclusion I have reached by the considerations to which I am required to have regard under sections 56 to 58 of the Civil Procedure Act 2005 .