Mulvany v Hive & Wellness Australia Pty Ltd [2019] VSCA 122

Court of Appeal (Vic)|2019-06-07|Before: Dixon J, John Dixon J, Rothman J, Campbell J, Kyrou JA, Emerton JA

PRACTICE AND PROCEDURE - Interlocutory injunctions - Restraints on publication of representations concerning respondents - No change in material circumstances - No error in exercise of discretion by judge in interlocutory application to vary restraints - House v The King (1936) 55 CLR 499 and applied.

1 This is an application for leave to appeal from the decision of John Dixon J refusing to vary certain restraints imposed on the applicant, Simon Mulvany ('applicant' or 'Mulvany') on 25 May 2017.[1]

2 The first respondent ('Capilano Honey') is a producer of honey and the second respondent, Mr Ben McKee ('McKee**'**), is its CEO. Capilano Honey markets and sells honey under brand names Capilano, Allowrie, Smiths, Wescobee and Barnes.

3 Mulvany operates, with others, a website called 'Save the Bees Australia', amongst other social media platforms.

4 On 15 February 2016, Capilano Honey and McKee commenced proceedings against Mulvany in the Supreme Court of New South Wales, Capilano Honey alleging injurious falsehood and McKee alleging defamation. A claim of misleading or deceptive conduct is also made. These claims are based on what the respondents described as a persistent and damaging campaign against them by Mulvany in online publications and social media that began in about June 2015. The respondents considered that Mulvany's campaign against them was designed to inflict commercial and reputational harm. The respondents seek injunctions to restrain future conduct but do not seek damages.

5 The proceeding was listed for trial on 25 May 2017. On that day, Rothman J adjourned the trial at the request of Mulvany but restrained Mulvany from publishing certain representations and imputations regarding the respondents ('Rothman J's orders'). Although the respondents were ready for trial and did not oppose the adjournment, they required what they considered to be necessary restraining orders to protect their position in respect of the asserted ongoing prejudice.

6 The proceeding was later transferred to the Supreme Court of Victoria. The parties have recently amended their pleadings and the proceeding has now been fixed for trial on 23 March 2020.

7 By summons filed 21 September 2018, Mulvany sought to vary some of the restraints imposed on him by Rothman J's orders. John Dixon J dismissed the application, essentially on the grounds that there was no change of circumstances.

8 For the reasons that follow, Mulvany's application for leave to appeal from John Dixon J's decision will be refused.

9 The case has had a complex and tortuous history since the commencement of proceedings on 15 February 2016. The procedural history, which is relevant to the issues on the application, is set out in detail below.

10 On 23 February 2016, Campbell J of the New South Wales Supreme Court, made orders, by consent, following negotiations between the respondents' lawyers and the applicant's lawyers. The applicant was, at that time, represented by Mr Kieran Smark SC and Mr Denis Fitzpatrick of counsel.[2] Campbell J noted various undertakings to the court given by the applicant. Although the undertakings were proffered without admission, they are detailed and specific and are expressed to continue 'until final hearing or further order of the court'. The undertakings relate to the removal of posts from Facebook, Instagram and Twitter, as well as refraining from publishing various representations and imputations.[3]

11 Various orders extending the timetable for the case management of the proceeding were made by consent, including orders requiring the respondents to file and serve a statement of claim by 23 September 2016 and requiring the applicant to file and serve a defence by 27 January 2017.

12 The respondents filed and served their statement of claim on 30 September 2016 and the applicant filed and served his defence on 5 April 2017. The applicant did not plead a substantive defence.

13 As noted above, on 25 May 2017 the proceeding was called on for trial before Rothman J in the New South Wales Supreme Court. The applicant was unrepresented at the hearing as he had dismissed his legal representatives[4] the prior evening, after the conclusion of a mediation, for unexplained reasons. His Honour vacated the trial and by consent made Rothman J's orders, with the applicant then seeking legal representation as he contemplated filing an amended defence. Rothman J specifically granted the parties liberty to apply 'in relation to any interlocutory issues including a variation to the orders issued today'. Relevantly the orders restrained the applicant 'from publishing the representations and imputations set out in paragraph 2(a)-(h) of the Court's Order of 24 February [2016] or representations and imputations to like effect'.[5] Further, by order 2, Rothman J ordered further restraints, including the bullying restraints referred to next. Although his Honour referred to the proceeding as being ex parte, he did consider that on the usual principles the interlocutory relief was made out and justified. His Honour also reminded Mulvany that although he was free to engage in public debate, he should, given the restraints, do so with caution.

14 On 14 June 2017, the applicant filed a notice of motion to vary Rothman J's orders.

15 On 25 July 2017, Mr Michael Morehead filed a notice of appearance/notice of address for service to represent the applicant.

16 The amended statement of claim dated 16 August 2017 pleads 106 publications, alleged to carry 666 mostly overlapping defamatory imputations and injurious representations, published by the applicant between 11 July 2015 and 25 May 2017 on Facebook, Instagram and Twitter.

17 On 18 August 2017, a further version of the amended statement of claim (dated 16 August 2017) was filed.

18 On 4 and 18 August 2017, McCallum J of the New South Wales Supreme Court heard the applicant's notice of motion to vary Rothman J's orders. The applicant was represented at this time by Mr Morehead.

19 On 1 September 2017, McCallum J deleted the restraint in order 2(c) (the 'bullying imputation') from Rothman J's orders, publishing her reasons in Capilano v Mulvany (No 2).[6] Her Honour noted the liberty to apply reserved by Rothman J in relation to any variation to the orders issued that day and the very specific application to vary the orders. Her Honour also considered that in light of the approach taken by Rothman J, and in particular his indication that the orders ought properly to be heard as if they were made ex parte, it was for Capilano Honey to justify the continuation of the orders. Capilano Honey was unable to do so in relation to the bullying imputation.

20 On 26 September 2017, Moreheads Lawyers filed a notice of motion on behalf of the applicant seeking to have the proceeding transferred to the Supreme Court of Victoria.

21 On 2 March 2018, McCallum J extended the time for the filing and serving of an amended defence from 20 October 2017 to 28 March 2018.

22 On 5 April 2018, Mr Morehead filed and served a notice ceasing to represent the applicant.

23 On 4 May 2018, the respondents initiated contempt proceedings against the applicant seeking a declaration that the applicant was in contempt of court for breach of Rothman J's orders, having published representations that the honey sold by Capilano Honey is toxic and poisonous. The contempt proceedings are yet to be heard.

24 On 5 and 18 May 2018, McCallum J heard the applicant's notice of motion for the proceeding to be transferred to the Supreme Court of Victoria. The applicant was unrepresented at this time.

25 On 30 May 2018, McCallum J transferred the proceeding to the Supreme Court of Victoria, publishing her reasons in Capilano Honey Ltd v Mulvany (No 3).[7]

26 On 20 July 2018, John Dixon J directed the applicant to file and serve any amended defence by 24 August 2018.

27 On 24 August 2018, Finch Lawyers filed a notice of appointment of solicitor to represent the applicant.

28 On 7 September 2018, the applicant filed an amended defence in accordance with consent orders extending the deadline for the applicant to file and serve any amended defence.

29 On or about 3 September 2018, publications were made following a joint investigation by Fairfax and the ABC concerning the testing of honey for adulteration, including using a Nuclear Magnetic Resonance ('NMR') testing method. These publications and others were advanced by the applicant as constituting the 'Recent Media Coverage' relied on in support of his application that is the subject of this appeal.

30 On 21 September 2018, and in light of the Recent Media Coverage, the applicant filed a summons seeking to vary Rothman J's orders by deleting various restraints. It is important to note that the application was based on changed circumstances and did not seek to set aside or revisit the basis on which the orders were made. There was no suggestion that Rothman J's orders, based in part on the undertakings given to Campbell J, should not have been made, or should be set aside or re-argued. Rather, the application assumed and proceeded on the basis that the orders were properly made but should be varied in the manner suggested based on the Recent Media Coverage.[8]

31 The variations sought are set out at paragraph [22] of the judge's reasons of 9 November 2018, which is reproduced as follows:

The defendant sought, on 21 September 2018, to vary Rothman J's orders by deleting various restraints as indicated below.
1. Until further order, the defendant is restrained from publishing the representations and imputations set out in paragraph 2a-h of the Court's Order of 24 23 February 2016, or representations and imputations to like effect. (Previously varied by Rothman J)

(c) That honey marketed and sold by the Frist [sic] Plaintiff, whether under the 'Capilano', 'Allowrie', 'Smiths', 'Wescobee' or any other brand, is contaminated by antibiotics or pollution;

(d) That the Plaintiffs deliberately mislead consumers to believe that honey marketed under the 'Allowrie' and 'Smiths' brands does not contain imported honey;

(e) That the Plaintiffs deliberately mislead consumers to believe that honey marketed and sold by the First Plaintiff, whether under the 'Capilano', 'Allowrie', 'Smiths', 'Wescobee' or any other brand, is not dangerous to their health;

(h) The Second Plaintiff, as CEO of the First Plaintiff, is dishonest in that he has permitted the First Plaintiff to use inferior untested imported honey, thereby putting the reputation of Australia as a producer of honey at risk, and then lying about it.

Until further order, the defendant is restrained from publishing the following representations and imputations, or representations and imputations to the following effect:

(a) That honey marketed and sold by the First Plaintiff, whether under the 'Capilano', 'Allowrie', 'Smiths', 'Wescobee', or any other brand is dangerous or contaminated.

(b) That the First Plaintiff, or any of its officers, are corrupt.

(c) That the First Plaintiff, or any of its officers, are bullies. [Previously varied by McCallum J] (citation omitted)

(d) That the First Plaintiff or any of its officers are dishonest.

(d) That the First Plaintiff illegally imports and sells honey.

(e) That the First Plaintiff exploits or mistreats bees.

(f) That the First Plaintiff has demanded that retailers remove competitor brands from their shelves.

(g) That the First Plaintiff or any of its officer are misogynist or sexist.

(h) That the First Plaintiff has bribed Choice and/or public officials.

(j) That the First Plaintiff is in breach of labelling laws,

(i) That the First Plaintiff has lobbied for a change to labelling laws to dilute or weaken them.

(l) That the First Plaintiff has damaged or tarnished the Australian honey producing industry and Australian beekeepers.

Until further order, the defendant, by 4pm on 31 May 2017, remove or cause to be removed the following publications, tweets and posts:

(a) the post referred to in paragraph 1aii of the Court's Order of 24 February 2016;

(b) the matters set out under the heading 'Relief Claimed' in paragraph 2i-liv of the statement of claim filed herein

The 18 April 2016 Save the Bees Australia Facebook 'Capilano Open Day' Post:

(c) the matters set out in Schedule A to these orders

The publication 'Chinese pollen at Capilano Honey Post' by Save the Bees Australia Facebook dated 23 October 2016

(d) the matters set out in Schedule B to these orders

Until further order, the defendant is restrained from publishing the publications, tweets and posts referred to in order 3, or any publication, tweet or post to like effect.

32 On 27 September 2018, the judge heard argument on the applicant's summons. At the time of the hearing, the applicant was represented by Finch Lawyers and counsel.

33 On 3 October 2018, AAV Legal filed a notice of change of solicitor to represent the applicant.

34 It is convenient to note at this stage that on 3 October 2018, the New South Wales Court of Appeal handed down its decision in Capilano Honey Ltd v Dowling (No 2)[9] (the 'Dowling Decision'), in which the Court unanimously affirmed McCallum J's decision of 8 June 2018 to vacate restraints made against Mr Dowling in Capilano Honey Ltd v Dowling (No 2).[10] The Dowling Decision was stayed from publication for 14 days so as to afford the respondents an opportunity to appeal. No appeal was filed and the Dowling Decision was published on 18 October 2018.

35 A brief procedural history of the proceedings against Mr Dowling is set out below:

(a) Following the commencement of this proceeding, the respondents commenced proceedings against Mr Dowling based on distinct publications made by Mr Dowling on his website and via social media.

(b) On 7 and 10 October 2016, orders were made on an ex parte basis restraining Mr Dowling from making certain publications, and suppressing the proceeding.

(c) On 8 June 2018, McCallum J handed down her decision on applications by Mr Dowling to dismiss the proceeding for want of prosecution; to review suppression orders; and to discharge interlocutory restraints. McCallum J dissolved the injunctions and suppression orders but did not dismiss the proceeding - Capilano Honey Ltd v Dowling (No 2).[11] The decision was stayed from publication until after 18 October 2018.

(d) On 15 June 2018, Basten JA of the New South Wales Court of Appeal, among other orders, stayed operation of the 8 June 2018 McCallum J orders until the determination of the proceedings in the Court of Appeal, publishing his reasons in Capilano Honey Ltd v Dowling (No 1).[12]

(e) As we have already stated, on 3 October 2018, the Dowling Decision was handed down but stayed for publication until 18 October 2018.

36 On 19 October 2018, having reserved his decision on the application that is the subject of this appeal, the judge granted leave to the parties to reopen their argument and file brief supplementary submissions on any implications arising from the Dowling Decision.

37 On 5 November 2018, the applicant's new legal representation, AAV Legal, filed a further amended defence.

38 On 9 November 2018, the judge dismissed the applicant's summons.

39 The main issue before the judge was whether there had been a material change in circumstances, as alleged, which justified the proposed variation of the restraints. However, his Honour also considered whether the respondents had sufficient prospects of success to justify continuing the restraints, and further whether the balance of convenience was in favour of continuing the restraints.

40 The judge found that the Recent Media Coverage did not amount to a material change in circumstances and could not be characterised as fresh empirical evidence that the first respondent sold adulterated honey under the Allowrie brand.[13] His Honour also found that to vary Rothman J's orders in the manner sought by the applicant would enable the applicant to step beyond the scope of the controversy addressed by the Recent Media Coverage.[14]

41 The judge found that the applicant's conduct - including the vacation of the trial before Rothman J on 25 May 2017 when the applicant dismissed senior and junior counsel (for unexplained reasons) - delayed the trial of the proceeding for a substantial time and denied the respondents an opportunity to establish their claim for final relief.[15]

42 The judge observed that the applicant was free, after he obtained advice, to seek to vary Rothman J's orders and he did so on 14 June 2017, when the applicant applied to vary the orders to delete reference to the 'bullying imputation'.[16]

43 The judge also found that the respondents had a prima facie case with a sufficient likelihood of success to justify the preservation of the status quo pending trial.[17]

44 The judge found that none of the reasons given in the Dowling Decision applied or were analogous to the circumstances in the applicant's summons.[18]

45 The applicant's supplementary submission to the judge advanced the opinion of McCallum J that 'the debate is one of broad public concern raising complex issues of trade regulation and heath safety regulation', which was unanimously approved of in the Dowling Decision. The applicant argued that, on the balance of convenience, he ought no longer be restrained from participating in the public debate of the broad public concern identified by McCallum J in Dowling.[19] The judge held that the applicant's contention that he is restrained from participating in 'public debate' was misconceived.[20]

46 The effect of the judge's decision is that Rothman J's orders (as varied by McCallum J) are still in force.

The trial division judge erred in that his Honour failed to apprehend that the ambit of the debate of broad public concern regarding questions of trade, health and safety regulation justified removal of the restraints of Rothman J's orders that are the subject of the applicant's 21 September 2018 summons.

The trial division judge erred in that his Honour failed to apprehend that the applicant's conduct in this case, and in the context of the burdens imposed on him by the respondents, did not unreasonably delay the trial of the proceeding to such an extent that it was determinative that the restraints should not be removed.

Nature of application - relevant principles

48 There are two relevant principles that require this Court to proceed with caution.

49 First, the decision of the judge involved the exercise of a discretion. Accordingly the applicant is required to overcome the threshold requirements set out in House v The King.[21]

The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.[22]

51 In the recent decision of Charan v Nationwide News Pty Ltd,[23] this Court refused leave to appeal a discretionary decision of the trial judge in relation to costs. The Court said that '[s]uch a challenge can only succeed if the decision is infected with House v The King error'.[24] The Court held that in relation to various matters it could not be said that 'the mis-weighting was so great as to constitute a failure to bring matters to account at all' which would give rise to an error within the principles of House v The King.[25]

52 Second, the decision of the judge is interlocutory. In Cargill Australia Ltd v Viterra Malt Pty Ltd,[26] the majority (Kyrou and McLeish JJA, Whelan JA dissenting) held:

The fact that an order in respect of which leave to appeal is sought is an interlocutory order regarding a matter of practice and procedure is a significant consideration bearing upon the exercise of the residual discretion. In Bodycorp Repairers Pty Ltd v GDG Legal Pty Ltd, this Court set out the governing principles as follows:

While the old distinction between interlocutory and final orders no longer exists, the principles which underlay the former requirement for leave whenever a party sought to appeal an interlocutory order to continue to be potentially relevant. In particular, it is most important for the proper administration of justice that this Court keep a 'tight rein' upon interference with interlocutory orders at first instance, given the potential consequences of a failure to do so in terms of delay and increased cost, and given the potential for applications in relation to interlocutory orders to become a means whereby discretionary judgments in the trial division are in effect transferred to the Court of Appeal. That is especially so where, as here, there has already been a rehearing de novo of a decision made by a judicial registrar of this Court.[27]

53 After referring to the requirement that leave to appeal will only be granted if the Court of Appeal is satisfied that there is a real prospect of success,[28] Kyrou and McLeish JJA held that the Court has a 'residual discretion to refuse leave, even in those cases where the appeal has a real prospect of success'.[29] Their Honours went on to say that, 'there may be cases where no substantial injustice will be done if the decision stands, especially when the appeal is from an order as to practice and procedure'.[30]

54 In relation to substantial injustice, Kyrou and McLeish JJA said:

There is no separate requirement under s 14C [of the Supreme Court Act 1986] that 'substantial injustice' be established if the decision sought to be appealed were to stand. The distinction is between those appeals whose prospects are real and those whose prospects are fanciful. At the same time, the concept of substantial injustice may be useful in determining whether the residual discretion should be exercised. Observations regarding substantial injustice made by this Court in Swan Hill Chemicals Pty Ltd v MA & J Tripodi Pty Ltd must be understood in the light of the requirements of s 14C as explained above.

This Court held in Molonglo Group (Australia) Pty Ltd v Cahill as follows:

Even if this Court is satisfied that an appeal has a real prospect of success, it may nevertheless refuse to grant leave in the exercise of its residual discretion, such as when no substantial injustice will be done if the decision at first instance stands, or the order sought to be appealed against is one of practice and procedure. The question of leave may sometimes be approached by considering, first, whether discretionary considerations exist which justify a refusal of leave, regardless of an applicant's prospect of success. Where discretionary considerations exist but by themselves are insufficient to justify a refusal of leave, refusal may nevertheless be warranted where those discretionary considerations arise in the context of an appeal that has low, albeit real, prospects of success.[31]

55 The applicant submitted by extensive reference to the Dowling Decision that the judge failed to apprehend 'the ambit of the debate of broad public concern' of the relevant matters and that the debate 'justified removal of the restraints'.

56 Relying on the Dowling Decision, the applicant in his written case submitted as follows:

There were two restraints against Mr Dowling in NSWSCA Dowling, both of which the Courts ordered to be removed. Further, the representations the Plaintiffs complain of for one of the restraints are described in the lead judgment of Basten JA as follows:

In summary terms, the representations which the respondent was restrained from publishing were to the effect that Capilano 'sells toxic and poisonous honey to consumers', and puts the lives of Australians at risk 'by knowingly selling honey that is full of antibiotics, toxins, irradiated pollen from China and alkaloids.'

To the extent it is relevant, those representations Mr Dowling was restrained from publishing are not substantially less serious than the imputations and representations in the 25 May 2017 Rothman J orders that are the subject of the applicant's application for leave to appeal in this proceeding before the VSC Court of Appeal.
On the balance of convenience, with respect, the applicant ought no longer be restrained from fully participating in the same public debate as Mr Dowling.
In these circumstances, and in any event, the order made from the effective finding by Dixon J that the restraints of the 25 May 2017 Rothman J orders that are the subject of the applicant's 21 September 2018 Summons are not within the ambit of the debate of broad public concern regarding questions of trade, health and safety regulation that would justify those restraints being removed, should be set aside.

57 In submissions before us, Mr Barrow who appeared for the applicant appeared to concede that changed circumstances had not occurred but nonetheless submitted that this was not a 'mandatory requirement' and that there was a higher principle, namely the interests of justice that in this case entitled the applicant (like Mr Dowling) to fully engage in public debate concerning the safety of honey. He also contended that unlike the Dowling decision, his Honour had not taken this into account.

58 The respondents contended that reliance on the Dowling Decision is misconceived. It was submitted that the applicant had failed to identify any error in the approach of the judge or to establish that his Honour's finding to the effect that there was no change in circumstances and that no new facts had come into existence that rendered the restraints unjustified was incorrect. Further, the application to vary the restraints was confined and not intended to, and did not, proceed on the basis of permitting the applicant to engage in unrestrained and free public debate. On the applicant's own case, the balance of the restraints were to remain. Finally, the respondents submitted that the judge was not in error in holding that the restraints did not prevent public discussion on matters of significant public interest. Paragraph 20 of the respondents' written case put the point as follows:

His Honour accepted that there was a public interest in 'discussion of issues about honey purity, as represented by the recent media coverage', which 'cannot be conflated with the defendant's interest in disseminating his particular allegations against the plaintiffs'. The crux of the restraints did not, therefore, prevent public discussion on matters of significant public interest; as contrasted to preventing the publication of particular damaging statements in circumstances where the Applicant had not disputed the matters relied on by the respondents to establish a prima facie case.[32]

59 In relation to the applicant's almost exclusive reliance on the Dowling Decision the respondents submitted as follows:

At Application Book B [89]-[96] Dixon J deals with the (lack of) implications arising from the Capilano/Dowling Appeal Decision on the issues before him. The factors underpinning the underlying Capilano/Dowling Injunction Decision were correctly identified, and distinguished. Dixon J noted the Applicant's failure to address the differences between the Capilano/Mulvany Proceeding and the Capilano/Dowling case (Application Book B [93]). His Honour concluded that:

[95] As discussed above, there is no restriction on the defendant engaging in the public debate constituted by the recent media coverage. To do so would involve some care about what he said, in order to comply with Rothman J's orders. The defendant's contention that he is restrained from participating in public debate is misconceived. [emphasis added]

...

Without properly articulating any reasons behind it, the overall position seems to be simply that the Applicant must be put in the same position as Mr Dowling following the Capilano/Dowling Appeal. This impermissibly shifts the focus away from the particular circumstances of the Applicant's Summons. This error can be perceived in the Applicant's implicit suggestion that he ought no longer be subject to any restraints, which is far removed from the position in the Summons before his Honour. The 'errors' asserted in proposed ground 1 do not arise and this ground ought to be rejected.

60 The application below, for very specific variations to Rothman J's orders, was made because of the contended changed circumstances arising from the Recent Media Coverage. The judge dealt with the application on this basis.[33] It was dismissed for substantially three reasons. The first reason relates to the second ground of appeal and is considered below (applicant's conduct). Secondly, his Honour, after an extensive review of the Recent Media Coverage, considered that 'the recent media coverage has not changed the circumstances in which Rothman J's orders now operate to any appreciable extent'. Thirdly, his Honour held that 'the public interest in discussion of issues about honey purity, as represented by the Recent Media Coverage, cannot be conflated with the defendant's interest in disseminating his particular allegations against the plaintiffs'.[34]

61 In relation to the second reason for dismissal, it is relevant to note, as did the judge, that despite explicitly naming Capilano Honey, as well as its Allowrie branded honey products, as forming part of the 'adulterated' honey samples, the Recent Media Coverage did not go as far as stating that Capilano Honey was knowingly or deliberately involved in the adulteration. In fact, some of the Recent Media Coverage stated that there is no suggestion that Capilano Honey's Australian sourced-honey had any issue or that Capilano Honey was aware of the adulteration.[35] The judge said:

The difficulty for the defendant's contention of changed circumstances is that he could not identify anything in the recent media coverage that supported his contention that the plaintiff's no longer could show a sufficient likelihood of success to justify the preservation of the status quo pending trial. Nothing in the recent media coverage suggested that:

(a) any of the first plaintiff's honey was contaminated by antibiotics or pollution, or was otherwise dangerous or contaminated;

(b) the plaintiffs deliberately mislead consumers to believe that honey marketed under the 'Allowrie' and 'Smith' brands did not contain imported honey;

(c) the first plaintiff was knowingly involved with the production/sale of adulterated honey;

(d) the second plaintiff was dishonest in that he permitted the first plaintiff to use inferior untested imported honey, thereby putting the reputation of Australia as a producer of honey at risk and then lying about it;

(e) the first plaintiff or any of its officers were dishonest;

(f) the first plaintiff illegally sells honey;

(g) the first plaintiff exploits bees;

(h) the first plaintiff was in breach of labelling laws; or

(i) the first plaintiff has damaged or tarnished the Australian honey producing industry and Australian beekeepers.

...

I accept the plaintiff's contention that the following conclusions can be drawn from the recent media coverage:

(a) it referred to the potential for adulteration by addition of syrups, but not allegations of contamination with pollution, antibiotics, or being dangerous;

(b) there was no suggestion that the first plaintiff was knowingly involved in the production or sale of adulterated honey; and

(c) there was no reference to exploitation of bees, or that the plaintiffs have been dishonest or deliberately misleading.[36]

62 These findings are not challenged. In fact, as noted, the applicant appears to have accepted that although there were no changed circumstances arising out of the Recent Media Coverage, a higher principle (public interest) required reconsideration of the restraints. This brings us to the judge's third reason.

63 The third reason follows from the second reason. As there were no changed circumstances arising from the Recent Media Coverage, the public interest and public debate about honey purity did not extend to the very matters the subject of the restraints. In other words, to the extent that the applicant has an interest in 'disseminating his particular allegations against [the respondents]', this does not arise out of the Recent Media Coverage, being the asserted changed circumstances and basis on which the application was argued. Consequently, although the applicant is free to engage in the debate, he is not entitled to extend the debate to include the allegations the subject of the restraints, matters which went beyond and in many instances well beyond the Recent Media Coverage. In relation to the limits of public debate, the judge said:

There is no impediment on the defendant commenting, for example, on the suitability of the NMR testing or on the testing regimes operated by government. The variations sought by the defendant went far beyond that required to report or comment on that media coverage. I do not accept that the plaintiff's participation in the recent media coverage has opened the way for the defendant to publish comment directed at the plaintiff's on the matters that are the subject of Rothman J's orders. To vary the orders in the manner sought by the defendant would be to permit the defendant to step well beyond the scope of the controversy addressed by the recent media coverage. That is because the crux of the restraints is not to prevent public discussion on matters of significant public interest. It is rather to prevent actual damage to the first plaintiff's business and the second plaintiff's reputation by malicious publication of false statements pertaining to the first plaintiff's business. The restraints prevent the defendant publishing statements about the conduct or characteristics of the plaintiffs in particular respects. Absent that focus, there is no impediment on public comment on honey importation, testing, purity, health considerations, labelling laws, the treatment of bees and honey fraud.[37]

64 These reasons are not the subject of any specific ground of appeal. Rather, having little regard to the way in which the application was run below, the applicant as noted relies exclusively on a far broader ground of appeal based on the Dowling Decision, without having sufficiently argued the matter below. It was noted by his Honour that the applicant failed to address the critical differences between the cases.[38] The applicant, although conceding that there are differences, has still failed to do so.

65 The broader ground of appeal appears to accept that there were no changed circumstances and that the applicant was entitled to engage in the public debate, in the manner suggested by the judge, but contends that 'the ambit of the debate of broad public concerns' is such that the applicant should be entitled to go beyond the current public debate and in the interests of this debate make the allegations against the respondents that are the subject of the restraints. As noted, the applicant relied on the notion of a 'higher principle' that enabled the restraints to be varied and the Dowling Decision that compelled such revisitation.

66 We do not accept that there is a higher principle as submitted by the applicant, or if there be such a principle, that it operates in the manner suggested. The authority relied on by Mr Barrow was cited by the judge:

The relevant principles were not in dispute. In Liu v The Age, McColl JA said:

The constrained approach courts take to permitting interlocutory orders to be revisited reflects the proposition that a court must remain in control of its interlocutory order but, too, that a further order will be appropriate whenever inter alia, new facts come into existence or are discovered which render its enforcement unjust.[39]

67 This is not authority for the proposition that interlocutory orders may be revisited absent changed facts. If the higher principle is to be understood as a reference to the unjust enforcement of the interlocutory orders, this must, as the paragraph cited confirms, arise out of new facts. Although the cited passage uses the words 'inter alia, new facts' it does not contemplate a situation in which effectively nothing changes. If there is no change then there is no occasion to revisit the interlocutory order. This represents the critical difference between this case and the Dowling Decision to which we now turn.

68 Even if the applicant is permitted to argue this broader ground, it must fail. The judge specifically considered the factors underpinning each case and, in our view, correctly identified and distinguished them. His Honour said:

I am not satisfied that that decision in Dowling is relevant to the determination of the present application.
As the plaintiffs' observed, there were three primary reasons given in Dowling that justified revisiting the injunctions. First, there had been no contested hearing regarding the injunctions. Secondly, there was confusion as to the scope and duration of the injunctions in their original form. Thirdly, the plaintiffs had delayed in prosecuting the proceeding. None of these reasons apply or are analogous to the circumstances of the present application. Even if these elements were also present in the current case, that would not be determinative.
The procedural history in Dowling is significantly different to this proceeding. The different procedural history is relevant to understanding how the respective applications have been determined. The circumstances in which Rothman J's orders were made in this case are set out earlier in these reasons. The circumstances in Dowling are set out in the judgment of both the trial judge and the Court of Appeal. It is not necessary in these reasons to recite and compare the differences, they are readily apparent. There is also an important substantive difference in the applications in that here the defendant only seeks to vary Rothman J's orders, and does so primarily on the basis of the recent media coverage with respect to NMR testing.
In any event, the defendant did not address these matters in his supplementary submissions. The defendant submitted:

McCallum J held that 'the debate is one of broad public concern raising complex questions of trade regulation and health safety regulation'. Her Honour was not persuaded that it is appropriate to restrain Mr Dowling from participating in that debate. And further: 'I am not persuaded that this is the kind of case in which interlocutory orders should pre-empt the final hearing.'

The Justices of Appeal unanimously approved of McCallum J's decision:

It was open to the trial judge to conclude the orders imposed significant restraints on the respondent's ability to engage in public debate regarding questions of trade, and health and safety regulation: [55]. Evidence was not required to establish the existence of public concern about these issues; if it were required, it could be found in the corporate applicant's own case about the alleged damage the articles could cause it: [57].

The Defendant respectfully submits that on the balance of convenience, after such a long period of 'temporary' injunctions having been in force, he ought no longer be restrained from participating in that same public debate such that the application to vary the Rothman J orders made on 25 May 2017 be granted.

As discussed above, there is no restriction on the defendant engaging in the public debate constituted by the recent media coverage. To do so would involve some care about what he said, in order to comply with Rothman J's orders. The defendant's contention that he is restrained from participating in public debate is misconceived.
Secondly, a long period of 'temporary' injunctions is not a matter that properly arises from Dowling, and is not encompassed in the limited leave given for supplementary submissions. In any event, what I have said above concerning the reasons for delay would dispose of that submission, if permitted to be advanced.[40]

69 Other than to the extent that his Honour's reasoning involves ground 2, there is no specific attack on his Honour's reasons and no specific ground of appeal. The gravamen of proposed ground 1 is that the applicant should (without proper articulation as to why) effectively be treated no differently from Mr Dowling and that he should not be restrained from participating in the public debate. However, for the reasons given by the judge, the cases are very different both procedurally and substantively. The obvious critical difference is that in Dowling there had not been a contested hearing regarding the injunctions. In this case there was no need and it was not sought by the applicant who, as noted, proceeded at all times on the assumption that the restraints were validly in place. By consenting to the restraints on 23 February 2016, while represented by experienced senior counsel, and not at any stage seeking to revisit the undertakings or orders, other than to a limited extent, before McCallum J and John Dixon J, the applicant effectively gave up his right to a fully contested interlocutory hearing. In fact, as noted, both applications to vary Rothman J's orders were predicated on the continuing existence of the majority of the restraints.

70 A further relevant matter, emphasised by Ms Marcus of counsel who appeared for the respondents, was the evidential basis upon which the applicant in Dowling proceeded before McCallum J. This of course was most relevant in establishing the foundation for the injunction or restraints. Unlike the case before us, where there was considerable evidence of damage and likelihood of damage,[41] the insufficiency of the evidence was a critical part of her Honour's reasoning.[42]

71 It is not surprising therefore that the New South Wales Court of Appeal held that it was open to the trial judge (McCallum J) to set aside the restraints, based on the circumstances of that case, including the three matters referred to and the sufficiency of evidence. None of the matters that informed McCallum J's decision in Dowling are relevant to this case and it is hardly surprising that the entirely different circumstances led to an entirely different result. Based on these different circumstances, we conclude that it was open to the judge to dismiss the application.

72 The judge stated and applied the correct principles, took into account all relevant matters and exercised his discretion accordingly. No error of principle or other error falling within House v The King has been identified. The proposed ground must fail. There are insufficient prospects of success and we would refuse leave to appeal.

73 The applicant submitted by reference to the procedural history that he did not unreasonably delay the trial of the proceeding to such an extent that it was a relevant factor in justifying retention of the restraints.

74 After referring to the respondents' delay of over seven months (February 2016 to September 2016) in filing a statement of claim, the applicant in his written case submitted:

The applicant may have contributed to delay, but if he did so, it was not done capriciously. Reasons why any delays were reasonable would include:

(a) changing legal representatives and periods of self-representation;

(b) successfully applying for a restraint to be removed (14 June 2017 application; heard 4 and 18 August 2017; judgment 1 September 2017);

(c) successfully applying for the NSWSC proceeding to be transferred to the Supreme Court of Victoria (26 September 2017 application; heard 5 and 18 May 2018; judgment 30 May 2018). McCallum J was very critical of the respondents' choice of a venue in the State of NSW (which the applicant submits invariably caused delay):

...

The sheer volume of publications ('Pubs') the respondents complain of, and the numerous imputations ('Imps') and representation ('Reps') alleged to be carried by those publication, has also caused considerable delay.

75 The respondents submitted that the delay factor was only one of three factors considered by the judge in exercising his discretion and considering the nature and extent of the changed circumstances. In the respondents' written case the matter was put as follows:

Further, contrary to the tenor of the Written Case for the Applicant (at [18]), his Honour did not determine that the Applicant's contributions to delay were capricious or unreasonable. Delay by the Applicant was simply taken into account when assessing whether the 25 May Orders ought to be varied. Dixon J correctly gave consideration to the Applicant:

dismissing experienced counsel appearing pro bono, 15 months after the proceeding was commenced, on the eve of the scheduled trial date (May 2017) for which the Respondents were prepared, causing that trial to be vacated; 2. some months later applying to vary the 25 May Orders; and

subsequently applying for case transfer to Victoria in September 2017 (having conducted the litigation in Sydney for approximately 18 months).
The Applicant's Grounds and Written Case challenge none of these findings, instead conceding that the Applicant 'may have' contributed to delay.
Paragraphs 16-18 of the Written Case for the Applicant set out a number of events, including criticisms of the Respondents' conduct of the proceeding, that appear to be contended to undermine the Judge's assessment of the impact of the Applicant's delay, characterising the Applicant's conduct as non-capricious and reasonable. All of these events were set out in the uncontested evidence before his Honour. None of these events disclose a relevant error by the Judge. His Honour made no findings as to the capriciousness or unreasonableness of the Applicant's conduct.
Additionally, Dixon J expressly noted that even if the Respondents bore more responsibility for delay in progressing to trial, even to the level that the New South Wales Courts considered had occurred in the Capilano/Dowling Proceeding, this would not be determinative in assessing the balance of convenience. This assessment by Dixon J has gone effectively unchallenged in this application.
The final paragraphs of the Written Case for the Applicant assert that the large number of publications complained of in the Capilano/Mulvany Proceeding has contributed to delay. Dixon J was aware of and referred to the proceeding's breadth, the corollary of which is that the Applicant has continued to make a large number of publications (in respect of which a prima facie case has been made out).
In any event, the asserted complexity is significantly overstated, with the Applicant's calculations failing to account for the repetition of imputations and representations in the pleadings. It is also plainly irrelevant to the alleged error by the Judge as set out in proposed ground 2 to the appeal.
The errors asserted in support of proposed ground 2 have not been established. Dixon J's consideration of the Applicant's conduct delaying the trial of the proceeding was not determinative of the variation application, so there has been no 'failure to apprehend' that it was non-determinative as asserted ...
In summary, the Applicant's application for leave to appeal is without merit. The proposed grounds of appeal are based on an erroneous reading of the reasons for Judgment. The Applicant can point to no error. It cannot be shown that the Judge acted upon the wrong principles in the exercise of his discretion. Nor can it be shown that he allowed extraneous or irrelevant matters to guide or affect him. The Applicant can point to no mistake of facts referred to or relied upon by the Judge, and nor can it be shown that the Judge failed to take into account some material consideration that was before him.[43]

76 It is important to place in context the judge's determination as to the conduct of the applicant in delaying the trial. It was but one of three issues considered relevant. Clearly the most important issue related to the circumstances that underpinned the application, namely the Recent Media Coverage. It was comprehensively disposed of by the judge and is not the subject of any specific appeal ground. Accordingly, the critical basis of the application (unlike Dowling) failed. There were no changed circumstances.

77 Although this was sufficient to dispose of the application, his Honour fairly considered the interests of the parties pending trial, quintessential interlocutory and discretionary matters and revisited the restraints.[44] His Honour found that in all of the circumstances, and notwithstanding no changed circumstances, no variation was desirable and that the restraints were entirely justified. The applicant was still able to engage in the relevant debate, but with appropriate and desired caution given his previous conduct, pending contempt proceedings and the finding by his Honour that 'the plaintiffs have a prima facie case of sufficient strength to justify the maintenance of the status quo'.[45]

78 We do not consider that in taking into account the conduct of the applicant his Honour fell into error. It cannot be said, particularly in the circumstances of this case, that conduct is an irrelevant matter. In the context of the interlocutory process it is almost always a relevant matter. This is all the more so in relation to injunctive relief. Finally, in this context and of significant relevance is the fact that there is still no adequate explanation as to why the trial before Rothman J did not proceed in May 2017.

79 In our opinion, proposed ground 2 has no merit. No error of principle or other error falling within House v The King has been identified. Leave to appeal in relation to this ground will be refused.

[1] Capilano Honey Ltd v Mulvany [2018] VSC 672 ('Judgment').

[2] It should be noted that senior counsel is highly experienced in the area and was engaged on a pro bono basis pursuant to the New South Wales Supreme Court pro bono scheme.

[3] The restraint against publication comprises the undertaking noted in paragraphs 2(a)-(h) of the orders of Campbell J. The undertakings follow precisely the form of the interlocutory relief sought by the respondents in paragraph 10(a)-(h) of the originating summons filed 15 February 2016. By his agreement to proffer the undertakings, for the duration referred to, albeit without any admissions, the applicant represented by senior counsel who was highly experienced in the area, elected not to oppose the interlocutory relief sought.

[4] The same counsel that appeared before Campbell J.

[5] The original order contained the date 24 February 2017. This was amended to 2016 under the slip rule. The order is order 1 of Rothman J's orders and follows exactly the undertakings proffered to Campbell J as noted above.

[8] Transcript of Proceedings (27 September 2018) 8.28-8.29, 10.18-10.26.

[23] [2019] VSCA 36 (Beach, Niall and Ashley JJA).

[25] By contrast, in Trailer Trash Franchise Systems Pty Ltd v GM Fascia & Gutter Pty Ltd [2017] VSCA 293, the use of the wrong method of calculating costs was held (Tate and Kyrou JJA) to fall within the principles of House v The King so as to justify appellate intervention.

[26] [2018] VSCA 260 ('Cargill').

[29] Cargill [2018] VSCA 260 [110].

[31] Ibid [111]-[112] (citations omitted).

[33] Transcript of the Proceeding (27 September 2018), 8.28-8.29, 10.18-10.26.

[35] See, eg, Adele Ferguson and Chris Gillet, 'Capilano, Australia's biggest honey producer, and supermarkets accused of selling "fake" honey', ABC News (online, 3 September 2018) .

[39] Judgment [23] (citations omitted).

[40] Judgment [91]-[96] (citations omitted).

[41] Including the targeting of the share price of Capilano Honey (we were referred to exhibit AML-1 and the transcript before the judge at pages 55-57).

[42] Capilano Honey Ltd v Dowling (No 2) [2018] NSWSC 865, [53], [57]-[58] (citations omitted).

[44] Judgment [60]. There was probably no obligation to do this. As pointed out, unlike Dowling the injunction was firmly in place with every opportunity afforded to the applicant to vary or discharge the injunction. He failed to do so and proceeded on a basis that assumed its validity. It is too late for a contested hearing as to the original basis for the granting of relief. Further, unlike Dowling, there is no want of prosecution on the part of the respondents.

At a glance

Court

Decision date

Before

Source

Judgment (144 paragraphs)

Parties

Legislation Cited (1)

Cases Cited (1)