RESTIFA v PALLOTTA

Ali v Nationwide News Pty Ltd [2008] NSWCA 183 Bashford v Information Australia (Newsletters) Pty Ltd [2004] HCA 5; (2004) 218 CLR 366 Bennette v Cohen [2009] NSWCA 60 CASES CITED : Davis v Nationwide News [2008] NSWSC 693 Dow Jones & Co Inc v Gutnick [2002] HCA 56; (2002) 210 CLR 575 Howe & McColough v Lees [1910] HCA 67; (1910) 11 CLR 361 Lewis v Daily Telegraph [1964] AC 234 Mirror Newspapers v Harrison [1982] HCA 50; (1982) 149 CLR 293

Teresea Todaro RESTIFA (1st Plaintiff) PARTIES : Luigi CASSAGRANDE (2nd Plaintiff) Giampiero PALLOTTA (Defendant)

COUNSEL : Mr B R McClintock SC/Mr K L Andronos (Plaintiffs) Ms L Evans (Defendant)

SOLICITORS : Landerer & Company (Plaintiffs)

• 24 - IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

20247/07 Teresea Todaro RESTIFA & Anor v Giampiero PALLOTTA

JUDGMENT 1 HER HONOUR: This is an action for defamation brought by Mrs Teresea Restifa and Mr Luigi Casagrande against Mr Giampiero Pallotta in respect of three publications that appeared in an Italian internet newspaper called "Italia chiama Italia". 2 Mr Pallotta admits publishing the three matters complained of but denies that any of the publications defamed either plaintiff. The only substantive defence relied upon by Mr Pallotta is the defence of qualified privilege, both at common law and pursuant to s 30 of the Defamation Act 2005.

Circumstances in which the publications were made 3 In order to determine the issues in the proceedings, it is necessary to understand something of the Italian elections in 2006 and the participation in those elections of Italian citizens living outside Italy. The following summary, based on the limited evidence before me, is brief, but gives a sufficient understanding for present purposes. 4 Before the Italian elections in 2006, Italian citizens living abroad could be represented and participate in Italian political life in a variety of ways. The first was through the establishment in 1985 of "Comites", a composite term ("Com.It.Es") derived from the Italian words meaning "committee of Italians abroad" (Comitato degli Italiani all'Estero). The Comites operate within each overseas "consular jurisdiction" where at least 3000 Italian citizens reside, or where there is a diplomatic representative if there is no consular office. Members of Comites are elected by the Italian citizens within each such jurisdiction. They are charged with the functions of promoting social and cultural life, education, recreation, sport and social welfare of the Italian community residing within that jurisdiction, in consultation with the relevant consul. 5 Another way in which Italians living abroad could participate in Italian political life before the 2006 elections was through the establishment in 1989 of the General Council of Italians Abroad, which goes by its acronym in the Italian language "CGIE". The purpose of the CGIE is to advise the Italian government on matters of major interest for Italians living abroad. According to material tendered in the hearing before me, the CGIE represented the first step in a process aimed to develop active participation in Italian government by Italian communities residing abroad. It is made up of 94 members, 65 of whom are elected directly every five years by Italians living abroad through local electoral assemblies. The remaining 29 members are appointed by decree of the Italian Prime Minister. 6 In 2001 the Italian Constitution was amended so as to allow Italian citizens living abroad to be elected to each of the two chambers of the Italian Parliament, known as the Chamber of Deputies and the Senate of the Republic. The amendments provided for the election of 12 members of the Chamber of Deputies and six Senators from among Italians living abroad. For that purpose, the world other than Italy was divided into four parts. Australia was included in an electorate that also included Africa, Asia, New Zealand and all of the islands of Australasia and Antarctica. 7 The right wing of politics in Italy was then represented by the political party known as Forza Italia. In Australia, as apparently throughout many parts of the world, the interests of the Forza Italia party were represented by associations of people of like political interests known as "Azzurri nel Mondo". The word "Azzurri" literally means "the Blue ones". Its metaphorical sense was expressed by Mrs Restifa in the following terms: "'Azzurri' meaning people that are above suspicion, above bribes, above anything. They are pure. Because the Azzurri in Italy means that you are the best". 8 Mrs Restifa referred, by way of illustration, to the "Frecce Azzurri", which is the aeronautic division of Italy that flies in parades and such "in the greatest honour", and the Azzurri team which is the name given to the Italian Olympic team. She stated that the Azzurri nel Mondo were committees formed all over the world in support of the Forza Italia party. That party has in fact since been re-formed in Italy under the name "Azzurri nel Mondo", apparently in recognition of the strength and support of such committees. 9 At the time of the publications complained of in these proceedings, Mr Pallotta was the Secretary General of Azzurri nel Mondo in Australia. Mr Pallotta was born in Ancona in 1939 and came to Australia in 1982 when he was 43 years old. He stated that he had always been a non-political person but he had a great deal of respect for Mr Silvio Berlusconi. When Mr Berlusconi founded the Forza Italia party, Mr Pallotta, with appropriate permission, established the Forza Italia Club in Sydney. As I understood Mr Pallotta's evidence, it was Mr Berlusconi's government that passed the law allowing Italians abroad to elect representatives to the Italian Parliament. 10 Mrs Restifa was born in Sicily and came to Australia in 1968, after her home province was devastated by an earthquake. She met her husband through volunteer work in the Italian community and they established a family and a successful business in development and project management. She has been heavily involved in the Italian community in Australia for many years. After raising her family, she became involved with the Comites and the CGIE. During that time, she stated, "people in Italy noticed that [she] had the ability to be noticed by the community to collect votes". 11 Mr Casagrande was born in Venice and came to Australia in 1965 as a young man to work building bridges. He established a family here and a successful construction business. He also has done extensive community work in the Italian community in Australia. He was elected in 1998 as one of the four Australian members of the CGIE. 12 In the period leading up to the 2006 Italian elections, there appear to have been different understandings as to how candidates would be selected to run for the seats in the Italian Parliament reserved for Italians living abroad, at least so far as those in Australia were concerned. In mid 2005, Mrs Restifa and Mr Casagrande were each approached separately by Mr Dario Rivolta on behalf of the Forza Italia party and asked whether they were interested in becoming candidates for one of the seats. Mr Casagrande stated that Mr Rivolta was at that time a member of the "House of Representatives" for the Forza Italia party (I think he meant the Chamber of Deputies). He was also the Vice President of the Azzurri nel Mondo Association in Australia. 13 After further discussions Mrs Restifa and Mr Casagrande consented to apply for approval as candidates. They were given to believe that they would, in due course, probably be announced as the candidates. It was made clear to them, however, that their application had to be ratified by the Italian Court. It was then a matter for the party to make the announcement. They were told not to inform anyone of the approaches made to them by Mr Rivolta until such time. 14 In the meantime, Mr Pallotta was under the impression that the candidates would be selected by a vote of the members of the Azzurri nel Mondo Association in Australia. He favoured the selection of Mr David Campese, the great Australian rugby player, and Mr Frank Farina, the great Australian soccer player. He was unaware of the approach which had been made by Mr Rivolta to Mrs Restifa and Mr Casagrande. 15 On 13 December 2005, a meeting of nine members of Azzurri nel Mondo voted by majority to nominate David Campese and Frank Farina as the candidates. Mrs Restifa and Mr Casagrande were present at the meeting, but were not authorised at that point to disclose what they knew about the status of their own selection as political candidates. In early 2006, the Forza Italia party announced the formal nomination of Mrs Restifa and Mr Casagrande. The election was concluded in April 2006. Mrs Restifa and Mr Casagrande were not elected, apparently losing by a relatively small percentage of votes.

The first and second matters complained of 16 Well after the conclusion of the election, Mr Pallotta had an exchange of emails with Mr Rivolta, which he forwarded to a number of members of Azzurri nel Mondo. He said that he did so in the context of an on-going dialogue between Azzurri nel Mondo "all over the world" as to the unsatisfactory way in which the 2006 campaign had been conducted. 17 Mr Pallotta's evidence was that he sent the email to 20 or 30 people, who were "the people who were involved in the dialogue". One of those people was Mr Ricky Filosa, the editor of Italia chiama Italia. Mr Filosa republished the exchange in that publication. 18 The translation agreed between the parties of the full piece that appeared in Italia chiama Italia is as follows (the underlining is mine): "Rivolta & Pallotta: what is happening with the Azzurri nel Mondo?

It's not a straightforward situation. Azzurri nel Mondo are still standing. People abroad have realised this. Pallotta is only the tip of the iceberg. What can be done?

We have received and here publish an email that Giampiero Pallotta of Azzurri nel Mondo Australia has sent to the Editor Ricky Filosa. In the email he laments what the Azzurri leadership is doing - or rather, not doing.

Let me congratulate Antonio Zulian for his article of 20 March. Many of us would agree with him. We have understood that Azzurri nel Mondo are an empty box. I believe that if Berlusconi were to find out he would be really pissed off. The Hon Rivolta doesn't have the decency to reply to emails, let alone the rest of the so-called "Leadership" who are only worried about their own little, futile, personal issues and fighting among themselves. As their Australian representative they have appointed a "swindler" who occasionally visits Australia and who is supposed to have sold candidacies to the highest bidder . If I send an email to the Hon Zacchera I get a reply a few hours later or at the latest within 24 hours. That is how you really show your interest in Italians abroad who are working enthusiastically out of pure love for their country. It's true, we are naive for continuing to work hard for Forza Italia but we are only doing it out of admiration for Silvio Berlusconi. I will send a more detailed letter in the next few days. Best wishes.

• General Secretary of Azzurri nel Mondo NSW Inc. - Australia (FORZA ITALIA)

I always read your emails, even if not promptly. I must inform you however that the operations role of Azzurri nel Mondo is the responsibility of the General Secretary and the Organisational Secretary, as is liaison with our foreign branches.

The role of the Deputy Vice President as set out in the constitution is to take the place of the President when the president is unavailable.

• Foreign relations liaison for Forza Italia and Deputy Vice President of Azzurri nel Mondo

With your email you are distancing yourself quite a bit from me. Maybe this is due to the fact that I brought out into the open the behind the scenes scandal over the candidacies . A few months ago you were working together with me to organise an event to be held in Sydney next September. You looked after AC Milan. By the way, we held football sessions in January which were fairly successful. Unfortunately the organiser (Mr Cormac) did not involve the Italian community as he should have for it to be really successful. So, you were personally involved in organising these activities and we were corresponding regularly. Now you "fob me off" to the General Secretary and the Organisational Secretary because that is what is in the constitution!

I sent you a report on the Hon Zacchera's visit to Australia. You didn't even tell me if you received it. I sent you an email highlighting Ivano Ercole (Rete Italia) and James Panichi (ABC) as handy contacts (and possible candidates) to get involved in our Association to raise its profile and prepare for the imminent election campaign. I pointed out that Italia Media was interested in working with Mediaset if they wanted to establish a presence in Australia. You didn't have the courtesy to send me any kind of reply as you used to in the past. I am sorry but I can't thank you for all of this. Nevertheless I continue to extend my best wishes. Giampiero Pallotta - Italia chiama Italia". 19 The reference to the supposition that the candidacies had been sold to the highest bidder (the first passage underlined above) was repeated in an article by Mr Pallotta published in Italia chiama Italia the following week under the heading "Amici Azzurri, Cambiamo Musica!" (translated by Mr Pallotta to mean "Please change the music!" That article included the second matter complained of, the agreed translation of which is as follows: "5) To raise funds we had decided to organise at least one event every year and organise football training sessions in conjunction with AC Milan. To organise these events I regularly exchanged emails with the Hon Dario Rivolta which, at a certain point, suddenly stopped. It happened unexpectedly when I revealed what had happened behind the scenes with the candidacies. The latest suppositions are that they were sold by Vittorio Favale to the highest bidder. This gentleman was able to ingratiate himself with management in Rome and had himself appointed as the Australian "expert". He managed to do this as he occasionally visits Australia with his wife and is always welcomed warmly by us, a welcome that has been taken to be naive and foolish obsequiousness." Identification of the plaintiffs 20 By his defence, Mr Pallotta denies that the first and second matters complained of identified the plaintiffs. Plainly, the plaintiffs are not identified by name in either of those publications. They rely, however, on the fact that each was a candidate selected by the Forza Italia political party to stand for election to the Italian Parliament in the election concluded on 10 April 2006. In addition, they rely on the fact that the third matter complained of (an apology subsequently published by Mr Pallotta in terms not approved by them) identified them by name and thereby identified them as the subjects of the first and second matters complained of. 21 It is well established that a publication may be defamatory of a person although it does not name him. However, where a plaintiff is referred to by some description other than his name, he must prove as an element of the cause of action that at least one person to whom the matter was published reasonably understood it to refer to him. That element is amply established in the present case. 22 First, as observed by Mr McClintock, who appeared with Mr Andronos for the plaintiffs, the requirement is technically established by the fact that each plaintiff understood the articles to refer to the other plaintiff. More importantly, however, Mrs Restifa gave evidence that she received many phone calls after publication of the first article. She said that she had "days and days of being on the phone" with "probably dozens of phone calls" (T69). Although she did not articulate the precise terms of the conversations, it was clear from what she said that at least some of the callers were people who had identified her from the article. Her evidence to that effect was not hearsay in so far as it supported the inference that the callers reasonably understood the article to refer to her. 23 Mr Casagrande also gave evidence of receiving many such calls, but he did not take most of the calls himself. He was, however, able to provide details of three conversations, the contents of which support the inference that the callers had seen the article and understood it to refer to Mr Casagrande. That inference is further supported by the fact that the plaintiffs had, in fact, been two of the candidates. It is very likely that many people knew that by March 2007, almost a year after the election. 24 As already noted, Mr McClintock also relied on the fact that the third matter complained of (the apology) identified the plaintiffs as the subjects of the first two matters complained of. However, it is difficult to be satisfied with any confidence as to the extent of overlap between the relevant readers. In any event, it is not necessary to rest the inference on that basis.

25 I am satisfied that the first and second matters complained of identified each of the plaintiffs. Publication 26 Subject to the issue of identification, publication is otherwise admitted by Mr Pallotta on the pleadings. It is difficult, however, to make a finding as to the precise extent of the publications. The plaintiffs have a cause of action only in respect of publication to people who understand the Italian language in writing and who knew they were the candidates for the Forza Italia Party, although I accept that there would be substantial overlap between those two groups. Further, since the newspaper "Italia chiama Italia" is published only on the internet, the plaintiffs' cause of action lies only in respect of the receipt of the two articles in comprehensible form by people who downloaded it from the internet: Dow Jones & Co Inc v Gutnick [2002] HCA 56; (2002) 210 CLR 575 at [44]. 27 The plaintiffs called no witnesses who said that they understood the Italian language and understood the two matters complained of to refer to the plaintiffs. Nor was there any evidence as to the number of times the articles have been downloaded. 28 As already noted, however, each of the plaintiffs gave evidence as to the telephone calls they received after publication of the first article. Further, Mr Pallotta's own evidence was that he sent the original email to twenty or thirty people who were participating in the "dialogue", which he said "had to do with the choice of candidates". Whilst it is publication in the newspaper, and not by the email, that is sued on, that gives a measure of the likely number of Italian-speaking readers aware of the identity of the 2006 candidates. 29 I am satisfied on the strength of the evidence before me that the two articles were published to a significant number of people, although it is not possible to quantify the number. The third matter complained of 30 Within a week of the publication of the second article, a solicitor acting for Mrs Restifa and Mr Casasgrande wrote to Mr Pallotta complaining of the two articles and requiring him "to immediately publish an unreserved withdrawal of these allegations and an unconditional apology". The letter expressly stated that the wording of the apology should be agreed by the plaintiffs prior to publication. 31 Without consulting them, Mr Pallotta published the third matter complained of, the agreed translation of which was in the following terms: "ANOUNCEMENT - STATEMENT OF APOLOGY Pallotta Media Release

I Giampiero Pallotta, without the authorisation of the President John Caputo and the Committee, assume full responsibility for what I wrote and published in the on-line journal Italia chiama Italia on 30 March 2007.

In my capacity as General Secretary I am able to take personal action without prior consultation of the President and the Members of the Committee.

When sending a report to certain members of Azzurri nel Mondo, at one particular point I wrote: "To organise these events I regularly exchanged emails with the Hon Dario Rivolta which, at a certain point, suddenly stopped. It happened unexpectedly when I revealed what had happened behind the scenes with the candidacies. The latest suggestions are that they were sold by Vittorio Favale to the highest bidder…"

I regret that this simple supposition has offended Mrs Teresa Restifa and Mr Luigi Casagrande who, furthermore, I did not specifically name. It is therefore impossible that anyone could link them to the things I wrote.

In any case I ask them to accept my unconditional apology if I have caused them any concern. I undertake in future not to write on matters or situations which concern them and that they might be offended by.

32 The plaintiffs contend that, far from being an apology of the kind sought, the third matter complained of "made things worse" by repeating the underlying allegation without withdrawing it, and having the additional vice of specifically naming the plaintiffs. Mr Pallotta admits publishing the apology, and indeed relies on it in mitigation of the damages claimed in respect of the first and second matters complained of. 33 It is, however, very difficult to know the extent of publication of the apology. I am prepared, on the strength of the earlier events, to infer that it was probably downloaded by some people who understand Italian, but I can make no finding as to the likely size of that group.

Were the publications defamatory? 34 The plaintiffs contend that each of the three publications conveyed the following imputations defamatory of them:

"(a) the plaintiffs had bribed an official of a political party in order to become endorsed candidates for election to the Italian Parliament.

(b) the plaintiffs are corrupt people prepared to pay bribes to secure political advancement." 35 In each case, the second imputation was relied upon only as an alternative to the first. 36 Ms Evans, who appeared for the defendant, submitted that the defamatory sting of the three publications was an act or condition attributable, not to the plaintiffs, but to Mr Favale, who was described as "a swindler who occasionally enters Australia" and "who is supposed to have sold candidacies to the highest bidder". Ms Evans further submitted that, in the absence of any evidence in the proceedings as to how many candidates there were, and how many candidacies were allegedly sold by Mr Favale, the articles did not convey the imputations complained of. Finally, Ms Evans relied on the fact that the particular passage complained of was presented only as rumour, by use of the words translated as "who is supposed to" and "the latest suggestions are". 37 I do not accept those submissions. First, I think it follows inexorably that if a person in a position of authority is alleged to have sold candidacies to the highest bidder, the allegation extends to accusing those who became the candidates of, in effect, buying their candidacies. That, in my view, amounts to an allegation of bribery. 38 Further, I do not think the failure to identify the number of candidacies allegedly sold takes the matter any further. Plainly, being candidates, the plaintiffs were among the class of persons identified by that description. Finally, I do not think there is any force in the contention that Mr Pallotta should be relieved of liability on the basis that he was merely repeating a rumour for what it was worth. On that issue, Mr McClintock reminded me of the speech of Lord Devlin in Lewis v Daily Telegraph [1964] AC 234 at 283-284: "I agree, of course, that you cannot escape liability for defamation by putting the libel behind a prefix such as "I have "been told that …" or "It is rumoured that …", and then asserting that it was true that you had been told or that it was in fact being rumoured." 39 As noted by the High Court in Mirror Newspapers v Harrison [1982] HCA 50; (1982) 149 CLR 293 at 300, the essence of the relevant principle is that, by passing on a rumour, the defendant gives it his imprimatur, implying that it is or may be well-founded. 40 In the present case, Mr Pallotta plainly gave his imprimatur to the rumour that the candidacies had been "sold". That emerges from the overall tone of the emails and his boastful claims that he had exposed a scandal. I am satisfied that each of the matters complained of conveyed the imputation that the plaintiffs had bribed an official of a political party in order to become endorsed candidates for election to the Italian Parliament. That imputation is plainly defamatory. It is accordingly unnecessary to consider the alternative imputation (b). Defence of qualified privilege 41 As has been observed recently in a number of authorities, the principles relevant to the consideration of a defence of qualified privilege are well settled. The proper approach to the Court's task was considered by McHugh J in Bashford v Information Australia (Newsletters) Pty Ltd [2004] HCA 5; (2004) 218 CLR 366. His Honour stated at [53]: "At common law, a defamatory statement receives qualified protection when it is made in discharge of a duty or the furtherance or protection of an interest of the maker of the statement or some person with whom the publisher has a direct, business or social connection, and the recipient of the statement has a corresponding duty to receive or interest in receiving it" (citations omitted). 42 His Honour emphasised that the task is not to consider whether the communication is for the common convenience and welfare of society, but rather to "consider all the circumstances and ask whether this publisher had a duty to publish or an interest in publishing this defamatory communication to this recipient" (emphasis in original) (at [63]). 43 The notion of the "common convenience and welfare of society" is accordingly to be understood as the result of conferring the protection of the defence but not the determinant of whether the occasion is privileged. 44 The Court is required to examine all of the circumstances of the case, including "the nature of the defamatory communication, the status or the position of the publisher, the number of recipients and the nature of any interest they had in receiving it, and the time, place and manner of, and reason for, the publication: Bashford at [54]; cited in Bennette v Cohen [2009] NSWCA 60 at [9] per Ipp JA, Campbell JA agreeing at [206]. 45 The defence at common law is extended by s 30 of the Defamation Act 2005 in the following terms: "(1) There is a defence of qualified privilege for the publication of defamatory matter to a person (the recipient ) if the defendant proves that: (a) the recipient has an interest or apparent interest in having information on some subject, and (b) the matter is published to the recipient in the course of giving to the recipient information on that subject, and (c) the conduct of the defendant in publishing that matter is reasonable in the circumstances." 46 In either case (at common law or under s 30), it is an element of the defence that the recipient has an interest or an apparent interest in having information on the relevant subject. The word "interest" in reference to the recipient is used "in the broadest popular sense" but it is not enough to establish interest as a matter of gossip or curiosity. The recipients must have an interest in the information "as a matter of substance apart from its mere quality as news": Bashford at [148] per Gummow J, citing Howe & McColough v Lees [1910] HCA 67; (1910) 11 CLR 361 at 398. 47 In Bashford, the defence of qualified privilege at common law succeeded because the matter complained of was published only to the subscribers to a bulletin concerned with occupational health and safety who were, in the main, "individuals and corporations responsible for occupational health and safety in their respective workplaces": at [149]. 48 The circumstances identified by Mr Pallotta in the present case to support the contention that the occasion of each publication was privileged relate primarily to the process for selection of the Australian-resident candidates for election to the Italian Parliament leading up to the 2006 election. In respect of that particular aspect of the election, Mr Pallotta identifies as matters of public interest the apparent lack of due process and transparency in the pre-selection process and the apparent interference in that process by officials in Italy, contrary to what would have been expected under Australian electoral law. 49 Mr Pallotta alleges that he had a duty, as the General Secretary of the Azzurri nel Mondo Association in Australia, to publish information on those subjects and that the recipients had an interest or an apparent interest in receiving that information, since Italia chiama Italia was a forum for the discussion of Italian politics including the appointment or nomination of Australian candidates to Italian Parliament.

50 In respect of Mr Pallotta's reliance on an apparent interest for the purpose of the statutory defence, I should refer to s 30(2) of the Defamation Act 2005, which provides: "For the purposes of subsection (1), a recipient has an apparent interest in having information on some subject if, and only if, at the time of the publication in question, the defendant believes on reasonable grounds that the recipient has that interest." 51 Mr Pallotta did not give evidence that he believed that all of the recipients of Italia chiama Italia had an apparent interest in having information on the subjects identified in the amended defence. His evidence was to the effect that he believed the recipients of his email had that interest. As already noted, Mr Pallotta's evidence was that he sent the email only to 20 or 30 recipients, all of whom were people engaged in the "on-going dialogue". However, the statement of claim relies on publication not by email but in the internet newspaper. That is the act of publication admitted in the amended defence. 52 During the second day of the hearing, the case was conducted on behalf of the defendant in a fashion inconsistent with that admission, when it was sought to contend that Mr Pallotta was not liable for the decision of the editor, Mr Filosa, to republish Mr Pallotta's email in the internet newspaper. However, when the opportunity was afforded to the defendant to make an application to withdraw the admission, it was not taken up (T121.12). In those circumstances, there is no basis for a finding of apparent interest in accordance with s30(2). 53 The critical task is to consider the position, not of the recipients of the email but of the recipients of the articles. There was no suggestion in the evidence that Italia chiama Italia is a subscription bulletin, nor that it is dedicated to a specific topic. It certainly does not appear to be confined to being a forum for the discussion of Italian politics. On that issue, Mr Casagrande gave the following evidence, which was not contradicted by Mr Pallotta (at T34): "Q. Is it restricted to people with an interest in politics or who might vote in Italian elections, or is it read in the Italian community more widely? A. No, more widely because they got gossip about the next Miss Italia, gossip about who to go on holiday, where to go on holiday. It is a full page type of electronic newspaper which I have to make a point and the reason of this electronic newspaper section in Italy is because they try to form a strong lobby to get subsidies to have newspaper and I give you the classic example. If you got a newspaper in Australia, Italian language and you go over the 3,000 copy I think, daily, you get subsidies from Italian government. One newspaper we got which is a single because two editions with the same editorial, the Global La Fiamma is the only newspaper of Italian, they get 2.65 million dollars a subsidy a year. So you can understand why people just put newspaper on internet." 54 I am not satisfied that the recipients of the matters complained of had an "interest" in having information on the subjects identified in the amended defence, as that term is comprehended in the authorities. Accordingly, the defence of qualified privilege is not made out. 55 The statutory defence should, in my view, be rejected on the additional ground that Mr Pallotta's conduct in publishing the matters complained of was not reasonable in the circumstances. The considerations relevant to that issue include the matters set out in s 30(3) of the Defamation Act 2005. 56 In my view, it was clear from Mr Pallotta's evidence that, although he believed there was a rumour circulating to the effect published by him, he did not believe that rumour to be true. The imputation that was conveyed by each matter was, in my view, very serious. Further, in my view, far from merely repeating a rumour for what it was worth, Mr Pallotta lent his own endorsement to the allegation and had no basis for doing so. He made no attempt to distinguish between scurrilous rumour and well-founded allegation. He made no attempt to contact Mrs Restifa and Mr Casagrande, nor to take any other steps to verify the information he published. Accordingly, he has not satisfied me of the requirement of s 30(1)(c) of the Defamation Act 2005. Improper motive 57 The defence of qualified privilege is defeated if the publication of the matter complained of was actuated by an improper motive (sometimes referred to as malice). In case my assessment as to whether the matters complained of were published on an occasion of qualified privilege is wrong, it is appropriate to record my findings of fact relevant to that issue. 58 The plaintiffs rely on the following matters in support of the contention that Mr Pallotta was actuated by an improper motive in the publication of the matters complained of:

(a) that Mr Pallotta intended to cause harm to their reputations following their endorsement as candidates on behalf of Forza Italia in circumstances where he had prompted the endorsement of other potential candidates;

(b) that Mr Pallotta published the matters complained of in circumstances where he had no belief in the truth of the imputations;

(c) that the matters complained of formed part of an on-going campaign of public vilification conducted by Mr Pallotta against the plaintiffs;

(d) that Mr Pallotta has failed to provide a genuine apology to the plaintiffs;

(e) that Mr Pallotta had maintained a plea in paragraph 10(1) of the amended defence that the imputations are substantially true as a circumstance mitigating the harm suffered by the plaintiffs. 59 The contention that Mr Pallotta had no belief in the truth of the imputations is established by his answers to interrogatories which were tendered in the proceedings. In his evidence in the proceedings, Mr Pallotta stated in effect that he believed that the rumour existed, but not that there was any substance to it. There was, in my view, a measure of disingenuity in Mr Pallotta's evidence on that issue. That is disclosed in the following exchange in cross-examination (at T160): "Q. When you published this material in March 2007, that is the first two publications, what you wanted to do was damage my clients' chances of obtaining being candidates again for Forza Italia in any elections that might occur later? A. INTERPRETER: This is not true. I have already said that what I did had the purpose of getting rid of Mr Favale and. In fact your clients in 2008 were again candidates. So that they were not damaged. They did not suffer any damage. Now, I don't understand why they were so offended. If they didn't do it why should they be offended. Q. You don't understand, Mr Pallotta, that someone might be very justifiably angry of being accused publicly of paying a bribe. Is that your evidence? A. INTERPRETER: They were not accused. There was no allegation that they had bought from Favale. I didn't say anything. So they were not damaged because they were able to candidate themselves again. Why are they so offended. What is the reason?" 60 The evidence relied upon in support of the contention that Mr Pallotta intended to cause harm and had embarked on an on-going campaign of public vilification against the plaintiffs included an email dated 15 September 2007 from Mr Pallotta to a number of people (exhibit C in the proceedings) and an internet publication entitled "Il Supermarket Delle Candidature" dated 25 February 2008 (exhibit D in the proceedings). 61 In each of those documents, Mr Pallotta has repeated the second matter complained of, repeated his apology, announced the commencement of these proceedings and recited a series of matters ostensibly in support of the original "supposition" (that the candidacies were sold by Vittorio Favale to the highest bidder). It is not necessary for present purposes to recite all of the matters listed by Mr Pallotta in those documents. In my view, far from sustaining the "supposition", the matters recited by Mr Pallotta disclose a vitriolic campaign against the plaintiffs on his part which, on the evidence before me, appears to be entirely irrational. My view is reinforced by the surprising terms of the third matter complained of (the apology), which in my view added insult to injury. 62 I am less confident in placing any reliance, in determining the issue of malice, on Mr Pallotta's maintenance of a plea of substantial truth of the imputations as a matter in mitigation. Mr Pallotta was not cross-examined about that matter and there is no evidence before me on the strength of which I can judge the extent to which that course was encouraged or discouraged by any lawyers from whom Mr Pallotta has taken advice. In any event, I am satisfied that, in publishing the matters complained of, Mr Pallotta intended to cause harm to the reputations of the plaintiffs and that those publications formed part of an on-going campaign of public vilification against the plaintiffs.

Damages 63 It remains to assess the damages to which Mrs Restifa and Mr Casagrande are entitled. 64 I am required pursuant to s 34 of the Defamation Act 2005 to ensure that there is an appropriate and rational relationship between the harm sustained by the plaintiffs and the amount of damages awarded. The maximum amount of damages that may be awarded is $294,500: s 35 of the Defamation Act 2005. That is the maximum amount that may be awarded to each plaintiff in respect of all claims in the proceedings, even though they involve multiple causes of action: Davis v Nationwide News [2008] NSWSC 693 at [8]-[10] per McClellan CJ at CL. Mr McClintock accepted that there should be a single award for each plaintiff in respect of all three matters complained of: cf s 39 of the Defamation Act 2005. 65 As I have already indicated, it is difficult to be confident as to the precise extent of publication. However, I accept, as submitted by Mr McClintock, that this case does not warrant the classification of a "limited circulation publication" having regard to the number of people to whom Mr Pallotta sent his email and the large number of phone calls received by each of the plaintiffs (at least in respect of the first matter complained of) together with the fact that there were three publications, the last of which named the plaintiffs. 66 The imputation that was conveyed by each of the publications is serious, striking at the heart of the integrity of each plaintiff. I have already recited Mrs Restifa's evidence as to her lengthy involvement in voluntary community work in the Italian community in Australia, and Mr Casagrande's evidence to like effect. 67 Each of the plaintiffs was cross-examined to the effect that those who read the matters complained of and understood them to refer to the plaintiffs were their supporters and thought no less of them after reading those publications. The obvious response to that contention was nicely expressed by Mrs Restifa in the following exchange (at T69): "The major problem with the circulation of this newspaper and the news that got around the world is the reaching of people that don't know me personally, and if you are aware of how Italian politics are played, in our area, because it is so large, it is three quarters of the earth; it comprises all of Africa, it is all of Asia, all of the Middle East, all of Australia, the islands and Antarctica. Can you imagine if people get their information over the electronic news, because simply there is - there are places in all these areas where you don't get Italian newspapers. …" 68 Mrs Restifa went on to explain the extent to which she relied on newspapers and letters in her efforts to persuade constituents to vote for her, and her apprehension that, when they get "bad newsprint", they would believe it, especially when it comes from a person in her own party. 69 As already noted (in the discussion of malice above), Mr Pallotta relied, in mitigation of damages, on "the substantial truth of the imputations". There was no evidence whatsoever to sustain that position. I am not satisfied that the imputations are remotely true. 70 Mr Pallotta also relied in mitigation of damages on the apology which is the third matter complained of. An apology is capable, in principle, of mitigating damages: s 38 of the Defamation Act 2005. I accept, however, as submitted by the plaintiffs, that if anything, the apology in the present case exacerbated rather than mitigated the harm to their reputation. However, since the apology is itself one of the three matters complained of, I must take care not to double count the damage occasioned by it. 71 The plaintiffs claimed aggravated damages on the basis that the hurt and harm they suffered were increased by their knowledge of the falsity of the imputations and the malice of Mr Pallotta shown by "his deliberate and calculated use of his so-called apology to smear and traduce the plaintiffs further and to name them". I accept that the plaintiffs' knowledge of the falsity of the imputation increased the hurt to feelings experienced by them. It is also a matter relevant to the extent of harm to their reputation. 72 I do not think that it is appropriate, however, to take into account the plaintiffs' knowledge of Mr Pallotta's malice in aggravation of damages. I accept that, to the extent that the apology showed malice, that may have increased the hurt to feelings sustained by the plaintiffs. However, as already noted, there is a risk of double counting damages on that account, since it is relied on separately as one of the three matters complained of. I am required otherwise to disregard the malice or other state of mind of Mr Pallotta: see s 36 of the Defamation Act 2005. 73 Finally, I note that Mr McClintock very fairly conceded on behalf of the plaintiffs that their principal objective in these proceedings was to obtain vindication of their reputations. Consolation for their personal distress and reparation for the harm done to their reputation are also purposes of an award of damages: Ali v Nationwide News Pty Ltd [2008] NSWCA 183 at [70].

74 Bearing those principles in mind, and having regard to the limited evidence as to the extent of publication, I am of the view that the appropriate award is $40,000 for each plaintiff.

(1) I order that there be a verdict and judgment for the first plaintiff in the sum of $40,000.

(2) I order that there be a verdict and judgment for the second plaintiff in the sum of $40,000. (3) I order the defendant to pay the plaintiffs' costs of the proceedings. **********

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