REYNOLDS -v- SHARAZ [2023] WASC 327 (25 August 2023)

[2023] WASC 327

Supreme Court of WA|2023-08-25|Before: Solomon J

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General information, not legal advice.

At a glance

Source facts

Court

Supreme Court of WA

Decision date

2023-08-25

Before

Solomon J

Source

Original judgment source is linked above.

Judgment (28 paragraphs)

[1]

These reasons relate to the defendant's application for security for costs.
It is convenient first to provide an overview of the proceeding.
The plaintiff, Senator Reynolds, is a member of the Liberal Party and has been a senator for Western Australia in the Federal Parliament since 2014. Senator Reynolds was a minister in the Coalition Government from 2019 until the federal election in May 2022. Senator Reynolds' claim is reflected in her amended statement of claim filed on 17 August 2023.
Senator Reynolds' claim arises out of circumstances surrounding the alleged rape of a former Parliament House political staffer, Ms Brittany Higgins. The subsequent handling of Ms Higgins' complaint, the aborted trial of the alleged perpetrator, Mr Bruce Lehrmann, and the associated investigations, reports and settlements arising out of that trial have attracted significant media attention. In the most neutral terms, the journey of Ms Higgins' complaint through this nation's various political, legal and social institutions has sustained the public interest for a variety of reasons and for some length of time.
Senator Reynolds has had some involvement in that journey. In her amended statement of claim, Senator Reynolds pleads that the alleged rape took place at Parliament House in Senator Reynolds' ministerial office. The amended statement of claim pleads that Mr Sharaz is, and was at all material times, the de facto partner of Ms Higgins.
Senator Reynolds brings this action against Mr Sharaz alleging defamation in respect of four social media publications (the Publications). The Publications and defamatory imputations said to arise from each publication may be summarised as follows.
First, the statement of claim refers to a tweet authored and posted by Mr Sharaz on 27 January 2022, (27 January tweet) in which Mr Sharaz shared a webpage published by Senator Reynolds entitled 'Empowering Women'. In that tweet, Mr Sharaz wrote that 'there is a very real chance [Senator Reynolds] will be called to court this year to answer questions on her involvement in Brittany Higgins feeling pressured by her office not to continue with a complaint to police.' The 27 January tweet is alleged to give rise to the defamatory imputations that:

[14]

It is well established that the factors set out under O 25 are not exhaustive, and that the court's discretion is not limited to those factors. The relevant factors will vary from case to case and the power is always exercised to serve the interests of justice.[1]
As is made plain by O 25 r 1, an order for security for costs is not to be made solely because a plaintiff is likely to be unable to pay the costs which may be awarded against him or her. That important principle creates an obvious tension in the exercise of the court's discretion. On the one hand, the court's power is designed to ensure that a defendant is protected against the inability of the plaintiff to pay the defendant's costs. Yet the plaintiff's inability cannot of itself be a reason to award security. That tension has been observed in a number of cases. It is generally resolved by balancing the particular factors applicable in each case in the interests of justice.
Traditionally, the courts have been reluctant to award security for costs against a plaintiff who is a natural person as distinct from a corporation. This is a reflection of the law's historical concern to ensure that all people are afforded access to justice through the courts. As most defamation matters are prosecuted by natural persons, the award of security in defamation proceedings is perhaps less common than in other types of litigation.
The application of the principles in the context of defamation proceedings was reviewed and explained by his Honour Kenneth Martin J in Moran v Schwartz Publishing Pty Ltd [No 2],[2] and more recently in Bhatia v Gill.[3] In his review of the authorities, Martin J observed that some factor, in addition to inability to pay, is generally required to attract the court's discretionary power to award security for costs against a natural person.[4] Examples of such additional factors (that is, in addition to the inability to pay) include; residence outside Australia, prosecuting a claim for the benefit of others, and lack of prospects.

[19]

Senior counsel for Mr Sharaz appeared to accept that Senator Reynolds is not impecunious and that her prospective incapacity to pay the costs of a concluded and unsuccessful proceeding is not of itself sufficient to warrant an order for the provision of security. It was however contended that there were 'unique considerations' of this case that combined to render an order for security for costs appropriate and necessary.
First, senior counsel for Mr Sharaz pointed to the unique magnitude of the expense of the litigation should it continue through to its conclusion. Senior counsel submitted that it was likely on the evidence that the costs would exceed Senator Reynolds' capacity to pay. Thus, although Senator Reynolds was far from impecunious, the nature of this litigation was such that its full cost would likely be beyond her means.
Secondly, senior counsel for Mr Sharaz submitted that it was at least arguable, if not likely, that the applicable law is not the law of Western Australia but rather, the law of the Australian Capital Territory, where the Federal Parliament is located, or another Eastern States jurisdiction. The significance of that is that the statutory provisions in the Australian Capital Territory (and other Eastern States jurisdictions) provide for additional barriers to the prosecution of a claim for defamation beyond that required by the law in Western Australia. In particular, the claim is required to be preceded by a formal 'concerns notice'. In addition, there is a threshold requirement of 'serious harm'. That means that if the plaintiff cannot demonstrate that a valid concerns notice was provided in respect of a publication, or that the harm suffered by the plaintiff was sufficiently serious, the action cannot succeed or indeed proceed.
Senior counsel submitted that Senator Reynolds' claim cannot satisfy those threshold requirements. Not all the Publications were preceded by a concerns notice. The affidavit of Maddison McLauchlan sworn 24 August 2023 annexed a concerns notice dated 6 January 2023, issued by Senator Reynolds' lawyers to Mr Sharaz, in respect of two of the Publications. Senior counsel for Mr Sharaz suggested that there may be defects in that concerns notice rendering it noncompliant with the statutory requirements in the Australian Capital Territory or other Eastern State jurisdictions.
Further, senior counsel submitted that the vast sea of publicity and media commentary on the issues the subject of the action necessarily means that the few individual and now historic publications complained of amounted to a drop in the ocean. The Publications themselves, therefore, cannot possibly have caused serious harm.
Thirdly, senior counsel for Mr Sharaz submitted that even if the law of Western Australia applied, and there was therefore no threshold statutory requirement of serious harm, the effect of the vast publicity is such that the Publications could not of themselves have caused reputational harm that would result in an award in damages of any substantial amount. The proceedings therefore are disproportionate; the costs will invariably be of great magnitude whereas the monetary relief can only be minimal.
Fourthly, senior counsel for Mr Sharaz directed attention to other circumstances which, independently of the applicable law, were said to render Senator Reynolds' claim manifestly weak. Within the vast ocean of publicity, there was much commentary that was critical of Senator Reynolds for a variety of reasons but most importantly, for matters that related to the subject of the Publications, that is, her dealings with Ms Higgins and responses to Ms Higgins' complaint. The impact of that publicity was that Senator Reynolds' reputation was already well tarnished such that the Publications had no material impact. The effect of the allegedly defamatory Publications was therefore of negligible consequence and the case is therefore weak, or at least, negligible enough to render the action wholly disproportionate to its cost.
In order to illustrate the damaging impact of the broad wave of media commentary, affidavit evidence was filed on behalf of Mr Sharaz which annexed what was said to be a representative sample of that publicity. It included media articles from various sources critical of Senator Reynolds and the then-Coalition Government, of which she was at that time a minister.
Senior counsel for Mr Sharaz pointed to another asserted weakness of Senator Reynolds' claim. Although Mr Sharaz had not advanced an application to strike out parts of the statement of claim, senior counsel contended that various defects in the statement of claim reflected the lack of merit in the claim generally. I invited senior counsel for Mr Sharaz to direct me to a clear example of his concerns. I was directed to paragraphs 5 and 19 of the statement of claim. Paragraph 5 pleads the first publication referred to at [8] above, and paragraph 19 pleads the defamatory imputation said to arise from that publication. Senior counsel for Mr Sharaz submitted that the publication did not have the capacity to bear the pleaded imputation. The allegation could therefore not succeed. Senior counsel for Mr Sharaz was anxious to point out that although he directed attention to that example in response to my request for a clear illustration of his concern, his concerns were not limited to that example.

[20]

I accept that although Senator Reynolds is far from impecunious, if these proceedings continue to their natural conclusion, the costs will be very significant, perhaps crippling, and possibly beyond Senator Reynolds' means. As I have already noted, this is hardly a unique feature of this proceeding. On the contrary, it is an unfortunate but common feature of contemporary litigation. In my view, it does not provide a basis to order security for costs against a plaintiff who is a natural person.
Further, as I have already observed, s 44 of the Constitution provides a strong disincentive to Senator Reynolds to avoid the consequences of any failure to pay costs that she may be ordered to pay to Mr Sharaz.
I am also not persuaded, certainly at this stage of the proceedings, that I am in a position to assess the claim as weak or disproportionate. That is for a number of reasons.
First, a significant plank of the submissions on behalf of Mr Sharaz in this regard rested on the proposition that the law of Western Australia was arguably not applicable, or likely not to apply. I am not presently in a position to determine that question, nor has there been any application which would require me to do so. The choice of law in defamation proceedings is determined by s 11 of the Defamation Act 2005 (WA) which is in equivalent terms in other relevant jurisdictions. This is not the occasion to give detailed consideration to the analysis required by that section. It is sufficient for me to observe at this point, that in my view it is far from obvious that the law of Western Australia would not apply. In the circumstances, I do not discount the possibility that it may ultimately be found that the law of another jurisdiction may be applicable. However, on the evidence before me in the present circumstances, I would not regard that prospect of sufficient force so as to conclude that the claim is weak and that it is therefore appropriate to award security against a plaintiff who is a natural person.
Secondly, I am not persuaded that the vast sea of publicity somehow necessarily renders the Publications of negligible or less significance. It appears to me to be equally arguable that the volume of that publicity renders comments from those with the greatest proximity to Ms Higgins, such as the Ms Higgins' partner, all the more significant. I am therefore not persuaded at this stage that the ubiquitous and voluminous media commentary diminishes the significance of the Publications, or had the effect that Senator Reynolds' reputation was relevantly impugned independently of the Publications.
In that regard, as noted above, a representative sample of that vast media reporting was tendered in support of the proposition that Senator Reynolds' reputation was already tarnished such that the impact of Mr Sharaz's comments could not have been damaging in any material sense. That selection comprised some fourteen media articles. I appreciate that it was said, necessarily, to be only a sample. If the matter proceeds to trial, no doubt the evidence will be far more extensive. Nevertheless, the sample, such as it was, did not serve to demonstrate that Mr Sharaz's comments were rendered insignificant by the flood of media commentary. The sample included two articles reporting that Senator Jacqui Lambie called for Senator Reynolds' resignation. As I observed in the course of argument, a call for resignation from a rival politician hardly stands out as remarkable. The sample also included three articles from The Guardian, one from The New York Times, and one from a website called Junkee.com. It is difficult to conclude that publications of that nature would have so altered Senator Reynolds' reputation as to render Mr Sharaz's commentary immaterial.
In any event, as counsel for Senator Reynolds pointed out, previous publications of that nature are unlikely to be relevant. Counsel for Senator Reynolds directed attention to George's Defamation Law in Australia (4th ed.) at [36.4], in which the author writes that:

[22]

Fourthly, the amount of financial compensation is only one aspect of the relief generally sought in defamation proceedings. Vindication and restoration of a plaintiff's reputation can be equally if not more important than the quantum of the financial compensation. Thus even if the proceedings have the potential to be financially disproportionate, that may not be the central concern of a plaintiff.
Finally, in respect of senior counsel's concerns about the amended statement of claim, I would observe that disputes about pleadings are not uncommon in defamation matters, and commonly arise in the course of proceedings. It is well established that an application for security ought to be brought promptly and early in the life of proceedings. It is therefore unremarkable that security may be sought in circumstances where there remain outstanding concerns about the pleading. The expression of such concerns does not necessarily indicate that the claim is weak. I am therefore not persuaded that the outstanding concern regarding the pleading is a factor that weighs significantly in favour of the grant of security. This is especially so as in my view it is far from clear that the Publication identified at paragraph 5 of the amended statement of claim is incapable, on its plain and ordinary meaning (or when read in the context of other pleaded facts), of carrying the defamatory imputation of which Senator Reynolds complains. I appreciate that the concerns of senior counsel for Mr Sharaz are not limited to those paragraphs but the example provided by counsel did not demonstrate that the nature of the concerns were such as to lead to the conclusion at this stage that the claim is necessarily weak.
For the reasons I have explained, I am not persuaded that the circumstances of this matter warrant departure from the usual course so as to require the provision of security from a plaintiff who is a natural person and far from impecunious. Accordingly, the defendant's application will be dismissed.