Scott v Bodley

The evidence of the parties

1. The evidence served by the parties on the question of serious harm, set out in a Court Book which is Exhibit A, is as follows: 1. The affidavit of the plaintiff sworn on 12 November 2022. 2. The affidavit affirmed by Izaac Lyon, the solicitor for the defendant.
2. In addition, extracts from the plaintiff's Facebook page for his business were tendered by the defendant (Exhibits 1 and 2).

The matters complained of

1. On 16 March 2022, the defendant published, on each of the plaintiff's Google review and Facebook page for the business "Pottsville Painting Services", the following: "Critical: Professionalism, Punctuality, Quality Responsiveness, Value UNFINISHED JOB, OVER 130 DEFECTS and DAMAGE TO PERSONAL PROPERTY We contacted Dale for a quotation for both internal and external painting of our house in July 2021. Dale quoted both internal and external painting and the quote was accepted in August 2021 to commence work in Feb 2022. We text [sic] Dale in January 2022 as we had not heard anything and he confirmed start date in Feb 2022 and that the whole job would take three weeks to complete internal and external. The discussion was that they would commence painting on the outside of the house and if it rained they would work inside if unable to work outside. Days prior to arrival Dale advised of a price increase which had not been discussed previously. During this period most days they would work from 7am until around lunchtime approx. Only at property until 3pm three times for the whole three weeks. Three weeks in and the inside of the house has still not been started. We paid the original deposit prior to commencement then Dale asked for progress payment which had never been discussed prior. Progress payment was paid in order to keep work continuing. Discussed the conditions of no further payment required until job is completed outside. In this time numerous comments were made about how he is loosing [sic] money on this job even though it was a quoted job. Dale spray painted our front rails (This had never been mentioned in quotation at all, I asked why it was being sprayed and it said it only took him an hour to spray something that would take 6 hours to hand paint) and OVERSPRAYED onto the deck, our driveway, our plants, personal property including surfboards and kayaks and pavers. Dale then proceeded to try to gernie [sic] off the paint and dirt was splashed all over the wet paint on the deck he had just painted. Dale packed up and left our house at 9.30am this day. When getting the paint off he removed all the white rocks from between pavers and moved pavers and sand from around the driveway. He promised he would rectify the damage he caused. We asked him to come around when my husband came home this day to discuss the personal property that had been damaged and a verbal altercation in front of all of our neighbours was had. Dale promised to fix the damage he had caused and not [sic] further payment would be required. He would complete the outside of the house however was refusing to complete the inside now. A discussion was had and Dale raised his voice and swore numerous times in front of our 5 year old daughter. He made numerous comments around how he has lost money on this job and the time it was taking (even though they weren't working full days or painting inside in wet weather as was agreed), we reiterated to Dale it was a quoted job. That's why we asked for a quote and you inspected the property prior to issuing us a quotation. The next day Dale then had another verbal altercation which once again the neighbours witnessed and came over after he had left to check whether we were ok. Dale said no [sic] after he had left to check whether we were ok. Dale said no further payment would be required again and that he would fix his large mistake. Dale then sent an invoice the following day (even though we had discussed no further payment would be required on numerous occasions) I asked him on arrival what the invoice was for and he said he had changed his mind. Half an hour later him and his apprentice packed up their equipment and left without even telling us and have never been back. We tried calling, have emailed numerous times and not responding. Dale caused damage to our personal property and left the job unfinished with over 130 defects on the outside alone. We tried to contact Dale without success and it has been referred to the Fair Work Ombudsman. I would not recommend this Painter. Untrustworthy and unprofessional. Since speaking to others of our experience other negative stories at other jobs have been raised."
2. The following photographs were attached:

The imputations pleaded

1. The following imputations were pleaded: 1. Dale Scott was incompetent in painting Bettina Bodley's house. 2. Dale Scott behaved unprofessionally as a painter, in that he demanded a progress payment to which he was not entitled as a condition for continuing work on Bettina Bodley's house. 3. Dale Scott was dishonest in dealing with Bettina Bodley, in that he demanded additional payment from her, even though he had promised to complete the job without requiring any further payment. 4. Dale Scott was dishonest in dealing with Bettina Bodley, in that he had promised to paint both the inside and outside of her house within 3 weeks, but he refused to paint the inside. 5. Dale Scott behaved unprofessionally as a painter, in that he reneged on his promise to paint the inside of Bettina Bodley's house because he had under-quoted for the job. 6. Dale Scott verbally abused Bettina Bodley. 7. Dale Scott behaved unprofessionally as a painter, in that he refused to fix the defects he caused in painting Bettina Bodley's house.
2. There is no challenge to the imputations pleaded, or to their defamatory nature. This means it is not necessary for me to consider how imputations must be determined for serious harm trials (see Clayton J's observations in High Quality Jewellers at [10]-[13], referring to Zimmerman v Perkiss [2022] NSWDC 448 at [9]-[11]). Whether the English approach to imputations should be considered as preferable to the current system of plaintiff's pleading imputations at their highest is an issue which has been raised before (Ryan v Random House Australia Pty Ltd [2015] NSWDC 31 at [7]-[10]). Changing views where "alternative imputations" are put before the court are hinted at in Stead v Fairfax Media Publications Pty Ltd [2021] FCA 15 at [14]-[15], citing Trkulja v Google LLC [2018] HCA 25; (2018) 92 ALJR 619 at 627 [31]-[32] ("mean or midpoint"; "decide the most damaging"), and a robust approach was taken in Gatto v Australian Broadcasting Corporation [2021] VSC 83 at [19]-[48]; leave to appeal dismissed [2022] HCATrans 197), as is noted in Massoud v Nationwide News Pty Ltd; Massoud v Fox Sports Australia Pty Ltd [2022] NSWCA 150 at [66].

The plaintiff's evidence

1. Mr Scott has been a painter for approximately 27 years. Prior to starting his own business on 21 September 2020, he was employed by other persons. Mr Scott established "Pottsville Painting Services" as a sole trader but, from 21 June 2022, his business became registered as a company.
2. Mr Scott works mainly in the Pottsville and Cabarita Beach areas, which are small towns on the Tweed Coast. He occasionally does work in other small towns nearby. He has about 36 competitors in the Tweed Coast area. He does not advertise; instead, he encourages his customers to post reviews of his business on Google and Facebook, and from time to time will repost them to in order to promote his business. He says that new customers have told him that they have chosen to use his services rather than those of his competitors because of these positive reviews.
3. As Mr Scott is the only qualified and licensed painter in the business, he is the person with whom the clients interact. He currently has one apprentice, who has been employed for approximately 18 months, and his wife assists with the bookkeeping, but he handles all client contact.
4. Prior to the matter complained of, Mr Scott's business had an overall rating on Google of five stars out of five, as he had never received a negative review. He told the court that there were about 21 five-star reviews on his review site at this time.
5. After the matters were published on 16 March 2022, Mr Scott told the court he noticed a change immediately in terms of the reduced number of phone calls and work interactions. This reduction continued, not only after it was taken down on 31 March 2022, but to this day.
6. The degree of reduction in work terms was as follows: 1. From the time that the matter complained of was published until about late April 2022, Mr Scott only received about 1 to 2 enquiries per week and these inquiries did not result in any new work. About a month after the defendant took the matter complained of down (i.e. late April), he started to receive 2 to 3 enquiries per week, and the majority were able to be converted into new jobs. However, he asserts that his business has never recovered from the publication of the negative reviews, and this downturn continues to this day. 2. As a result of these negative reviews, he no longer receives word-of-mouth referrals. Previously, when potential customers rang him they would say that they had been recommended by someone else. However since the publication of the matter complained of, he longer receives such recommendations. 3. When the negative reviews were published, Mr Scott was fully booked for approximately six months in advance (although he reduced this figure to four and a half months in his oral evidence). Now his bookings are only for the next 4 to 6 weeks in advance. This has meant he has been unable to employ more apprentices and painters and thereby grow the business.
7. Mr Scott provided tax returns showing that the business is made the following net profits in the last two financial years: 1. $23,981 for the 2021 financial year. His gross receipts were $96,361 and his expenses were $72,380, including $4,787 salary and $414 superannuation. 2. $65,369 for the 2022 financial year. Hid gross receipts were $217,368 and his expenses were $151,999, including $43,992 salary and $3,862 superannuation. Mr Scott said that he profited from the sale of a house that year but later agreed that the "gross receipts" of $217,368 were for his painting work and not from the sale of property. He was not prepared to agree that the main reason for the increase in expenses were the wages and superannuation increases. 3. Mr Scott did not produce any records for the current financial year. He told the court that the losses arising from the downturn following publication of the matters complained of was not only constant but continuing to this day and would do so into the future.
8. What the plaintiff complains of here, as was the case in High Quality Jewellers, is that "even one negative review has the capacity to cause serious harm to reputation" (High Quality Jewellers at [18]), both past and future. In general terms, since publication of the matter complained of, Mr Scott says that he went from receiving 6 to 8 enquiries per week to only one or two and that, even though the matter complained of was only online for approximately 14 days, this remains the current situation. While the decline in number of inquiries may not appear large, it is submitted to be "serious" in relative terms and context, taking into account the modest scale of the plaintiff's business.
9. This evidence was the subject of challenge by the defendant, on the following grounds: 1. The plaintiff's affidavit and oral evidence are inconsistent with the particulars provided (which initially limited the drop to the end of April 2022) as well as with his financial records, which show his business increasing steadily in size. 2. The plaintiff's claim of harm ranges over loss of profit, loss of opportunity and loss of actual jobs in circumstances where none of these claims can be supported by expert evidence. None of the data necessary to determine what other causes of the asserted loss could be has been provided. Mr Scott was dismissive, for example, of any impact of the torrential rain and flooding of the Tweed Coast in February/March 2022 would have on his painting business. 3. There is no evidence from or about any customer or potential customer being deterred, or evidence that anyone even read it. The plaintiff has no Google analytics, likes or comments or other "platform of facts" (Sims v Jooste (No 2) [2016] WASCA 83 at [15]-[20]) upon which to base his claim that anyone read the reviews. There is no evidence that the "work interactions" or job requests came from people who read or even knew about the one-star review. 4. Mr Scott appeared to assert that everyone consulting his Google and Facebook sites had to read the reviews before proceeding further. It is not necessary to read all or any of the reviews in order to contact Mr Scott by telephone as he can be directly contacted on the Google website. 5. Although Mr Scott claimed that the downturn in calls caused his business to contract and as a result he was unable to hire another painter and another apprentice, he did in fact advertise on 15 August 2022, seeking a young, motivated person as an apprentice, or any painters looking for work in the area. 6. There is an absence of causation between the posts in March 2022 and any asserted downturn in calls and personal referrals.

Inconsistencies in the evidence of loss of business

1. Mr Scott says there was a decrease from ten to five calls between February and March 2022. This is, however, followed by an increase to 19 calls in June 2022 and a decrease of 12 calls in July 2022. The same pattern occurs in relation to interactions. As with the information provided about calls, there does appear to be a modest decrease in interactions between February and March 2022, followed by an increase to 37 interactions in June 2022 and a decrease to 15 interactions in July 2022. The February figures predate the one-star reviews.
2. What is missing from the listing of these figures is the explanation. All that is provided is some limited raw data and the plaintiff's opinion, from which I am asked to draw inferences that there can be no other explanation.
3. There is no discernible pattern to the calls; these are just numbers. For example, there appears to be a much greater decline in calls and interactions between June and July 2022, which could be due to any one of a number of factors, such as the winter weather. This kind of limited information cannot form the basis for an inference that the plaintiff has suffered any loss of business, let alone serious harm, as a result of negative reviews which were online for 14 days in March.
4. As to weather issues in February to March 2022 and thereafter, Mr Senior asks me to take notice of a matter of common knowledge (s 144 of the Evidence Act 1995 (NSW)), namely the extensive rain and flood damage caused over this period. This is not a matter requiring expert evidence (Settlers Estate Pty Ltd v Penrith City Council [2021] NSWCA 13), or even evidence such as rainfall tables, since the Flood Inquiry set up in March 2022 to examine the "catastrophic" flood event across New South Wales (to quote the description given by the NSW Government in its announcement) has since provided a report.
5. Mr Scott's description of a business unable to expand because he was not making enough money to retain an employed painter and an apprentice, and of having to let an apprentice go as a result, received something of a check when he was shown his business site's Facebook entry for 16 August 2022 which said: "Looking for a young motivated person for a painting apprenticeship. No experience necessary. Or any painters looking for work in the area? Give me a call - [redacted] Dale"
6. The plaintiff acknowledged that he had made this post but denied that it was a job offer of any kind. He said that "the business could not afford" to hire anyone. When asked why he would advertise in this fashion, he responded that it would take "three to four months" to find an apprentice, because he could not start anyone as an apprentice until he had got to know them, and he would not start them straight away but was planning to find someone who would be finishing school at the end of the year. When it was put to him that this was an advertisement for "right now", he said that he had found an apprentice who was not suitable because he was "not academic" enough, and that this showed that finding the right person took months.
7. Mr Scott gave an alternative explanation: "Mr Senior: I put it to you that the evidence you gave was not frank. This is an advertisement to employ someone immediately. Mr Scott: It's called networking."
8. Mr Scott said he had to network with other painters in the area in case of future work, and said that this was how he did it. I note that this post, which is illustrated with a photo of the business truck and what looks like a team of employees, received 8 "likes", from which I assume there must have been some response, but Mr Scott proffered no financial or other records in relation to reaction to this post, although the burden of proof for serious harm lies upon him. The denial of this post being an advertisement is not a response that is to Mr Scott's credit.
9. As noted above, what financial records are available all point to his business increasing and doing well. His income more than doubled in the 2021 - 2022 year. He initially sought to explain that away by saying that he had sold a house and applied the proceeds to his business, but then agreed that the heading "receipts" related to moneys paid to him for painting work. He denied that the rise in expenses was due to his hiring other painters to work although the salary and superannuation figures for 2021 - 2022 were much bigger than the previous year, although they clearly were.
10. Mr Scott was unable to explain how it was that he still received no word of mouth referrals as a result of the matters complained of when there was no evidence anyone read them during the two weeks these were online in March, let alone months later. What is more, half a dozen of his customers posted glowing five-star reviews of his business over the past six months. There is no evidence that any of these satisfied customers were aware of the matters complained of. In fact, there is no evidence that anyone ever saw, let alone read, the matters complained of.

The evidence of Mr Lyon

1. Mr Lyon's evidence sets out that the review section of the Pottsville Painting Services profile was on a separate page on the website. Users would thus call Pottsville Painting Services by selecting the telephone number, including the mobile-enabled version of the profile. Online or telephone interaction with the business, including navigating to the website of Pottsville Painting Services, does not require going to the review section at all, and thus does not include reading any of the reviews for the business (see paragraphs 16 to 18 of Mr Lyon affidavit). To do so, it is necessary to go the reviews page.

Did anyone read the matters complained of?

1. Although the extent of publication is "not a numbers game", it is a significant factor in terms of serious harm: High Quality Jewellers at [19] - [32]. It is for the plaintiff to establish the extent of publication.
2. An inference that a publication has been downloaded will not be drawn from the mere fact that the material has been posted on the Internet. A person claiming to have been defamed by online material must plead and prove facts to establish that the material complained of has been downloaded and viewed by at least one person: Massarani v Kriz [2022] FCA 80 at [53]; De Kauwe v Cohen (No 4) [2022] WASC 35 at [708]; Newman v Whittington at [12]. While a plaintiff may establish a "platform of facts" and rely upon inferences drawn from Google analytics and/or evidence of "likes" or comments, a mere assertion that someone must have read it because it was online will not suffice.
3. The fact that the plaintiff's Google listing was accessed by Google users during the 14-day period when the matter complained of was accessible online is insufficient evidence, without more, to draw the inference that those persons read the matters complained of. It would, however, be a start. The plaintiff does not have this evidence, either for Google or Facebook. It is even more difficult for the plaintiff to assert that, in the weeks and months following, persons who accessed the site after the matter complained of had been taken down somehow retained knowledge of their contents and continued not to consult the plaintiff for these reasons. This is despite the fact that, at all relevant times during the period following the taking down of the matters complained of, the plaintiff's painting services not only continue to have 20 positive five-star reviews but this number increased to 27.

Conclusion: nobody saw or read the matters complained of

1. I summarise the evidence of extent of publication as follows: 1. Unlike the matter complained of in High Quality Jewellers (at [20]-[21], the matters on both websites were only posted for a short period of time, namely 14 days. 2. Again, unlike High Quality Jewellers, the plaintiff cannot nominate a single person who read the matter complained of and asks that it be inferred that was read by many if not most of the persons consulting the site. However, the plaintiff has not provided particulars of how many persons visited the site, "liked" or commented on the matters, or statistics showing the adverse review was the most consulted (or, for that matter, consulted at all): cf High Quality Jewellers at [26]-[27]. Attempts by the solicitors for the defendant to obtain particulars of these persons who read the matters complained of were responded to by saying that the review was accessible to the "world at large" (CB 131) and was "widely read" (CB 131), which is impermissible: El-Mouelhy v Q-Society of Australia Inc (No 2) [2015] NSWSC 990 at [8]-[19]. 3. Again, unlike High Quality Jewellers, there is no evidence of the grapevine effect. There is no evidence of any conversations from clients, or of any of the plaintiff's neighbours or friends commenting to the plaintiff or to members of his family that they had read the matters complained of.
2. In Srecko and David Lorbek v Peter King [2022] VSC 218, a similar problem arose. There was no direct evidence of the number of persons who are clicked onto the Google reviews complained of. Even though there was evidence that about 1500 people accessed the plaintiffs' business website each day and would see the Google business page on which reviews were posted, there was still no direct evidence of any third party having read any of the reviews complained of, as there were no comments and no "likes". McDonald J concluded that it was not possible to make any findings as to the actual number of persons who had accessed and read the review. The most that he could find was that a small number of persons must have read and access the posts but that "beyond this finding there is no platform of facts on which an inference can be drawn as to the extent of publication" (at [71]). Not even this kind of limited evidence is available here.
3. Calling an expert witness might assist, but not if there is still no evidence of publication: Defteros v Google Inc [2020] VSC 324 at [23].
4. I am asked to assume that some persons must have accessed the site as they booked work with the plaintiff. There is, however, no evidence for the number of persons at any time, let alone the period of time on and shortly after the period when the matter complained of was online. Even if there were statistics for the number of visitors for the site, this does not mean that they were all customers, as Clayton J observed in High Quality Jewellers at [30]: "[30] Given the nature of the platform upon which publication occurred, being a review on a Google business page that appears as part of a search engine function, I cannot be satisfied that all of those who visited the page saw or read the review. Plaintiffs' counsel submitted that there would be no reason for a person to visit the business page, other than if they were potential customers of Micheli Jewellery and such persons would have an interest in reading reviews, particularly negative reviews. I do not consider that inference is open. There are many ways in which the business page can turn up as a result from a Google search, and, without more, I cannot draw an inference that all or most of the 26,000 visitors to the business page accessed or read the review."
5. In all of the above cases, there was a high amount of Internet traffic on the site. By contrast, Mr Scott acknowledges that he has a modest business and cannot in fact give any statistics as to how many persons visit his Reviews pages or his Facebook page beyond a generalised figure for "interactions" which is unexplained.
6. The plaintiff also asserts loss of business from a non-Internet source, namely word of mouth referrals. There is no evidence to connect reduction in word-of-mouth unless there is evidence of the matter complained of having been read while it was briefly online or of the grapevine effect.
7. Finally, when considering the assertion that one single negative review could have such a devastating effect as to negate the other 20 positive reviews, it is important to note the nature of Google reviews and social media, and the way in which they are read by what the Supreme Court in Stocker v Stocker [2019] UKSC 17 at [41] called "a new class of reader", namely the social media user. Google users know that Google reviews must be read with a degree of caution (High Quality Jewellers at [114]). They would know that these reviews are largely expressions of personal opinion. They would also expect a range of views and be unsurprised if there was an unflattering review, as unflattering reviews appear on many if not most business websites.
8. In those circumstances, an assertion that a particular tradesman was (or was not) competent is not a "serious" imputation but an expression of an opinion. The submission that these are serious imputations is accordingly rejected.
9. Taking all of the above into account, I cannot be satisfied that the matters complained of were read by any specific person and that if they were, they would be read in the context of social media opinion.
10. As noted above, I accept that the extent of publication, in relation to seriousness of harm, is not merely "a numbers game" (Dhir v Saddler [2018] 4 WLR 1 at [55]; George v Cannell [2021] EWHC 2988 (QB) at [118]), and publication to a large or small group of persons does not automatically result in a finding in favour of, or against, serious harm. It does, however, make the task of the plaintiff all the more difficult in terms of establishing serious harm, particularly given the context in which the imputations (which are not serious) are published.

Has the plaintiff established serious harm?

1. Mr Scott asks the Court to determine the issue of serious harm on the evidence he has served and not on the pleadings, pursuant to s 10A(7) of the Act. Those particulars were very limited, in that there was essentially an assertion that the defendant published the matters on both his websites and that there were 10 calls in February but only 5 in March 2022. The evidence adduced at trial goes further, but actually undermines even these limited particulars.
2. As set out above, Mr Scott's affidavit and oral evidence provided no evidence even of publication, let alone harm, and certainly no serious harm. The imputations are not serious, the matters present the information as personal experience and views, the period of publication was brief and there is no evidence anyone ever read it. In short, this is a good example of what Mr Mark Speakman SC MLA has described as "'backyard' actions based on trivial comments" (M Whitbourn,"Push for overhaul of national defamation laws to weed out 'trivial' claims", Sydney Morning Herald, 20 November 2019).
3. In Rader v Haines at [28], Brereton JA stated that "serious" harm must be "more than merely substantial" and (at [29]) that findings of serious harm should be based on evidence to that effect. What is required is fact-rich proof of harm that is or is likely to be serious, rather than inferences to be drawn from data such as the extent of publication, and there must be evidence of causation between the publication and serious harm (High Quality Jewellers (Ruling) at [10]).
4. The plaintiff has failed to provide any such evidence, or causation, and has thus failed to establish that the publication of the matters complained of has caused serious harm to his reputation. The proceedings will accordingly be dismissed.

Costs and other issues

1. Costs should follow the event. I order the plaintiff to pay the defendant's costs of and incidental to this hearing as well as the costs of the proceedings. I have granted liberty to apply.
2. Those costs include the plaintiff's costs of unsuccessfully opposing the early determination of the serious harm jurisdictional requirement. If I had acceded to that request, the alternative for the parties would have been a 5-day-plus hearing on issues such as qualified privilege and damages, in 2024 at the earliest, instead of a one-day hearing six months after the proceedings were commenced.
3. This demonstrates the usefulness of such hearings, in appropriate cases. While there will be many defamation actions where an early hearing on serious harm is not appropriate (as Warby J noted to be the case in England, in Alexander-Theodotu v Kounis [2019] EWHC 956 (QB)), serious harm is an important factor in terms of re-establishing the balance between freedom of speech and protection of reputation.
4. The serious harm threshold will be of particular use in minor claims where both parties have limited finances. The eye-watering costs of defamation litigation are generally acknowledged to be beyond the reach of ordinary working families. Reforms such as s 10A protect those most likely to find themselves in "backyard" litigation from having to sell the backyards in question to finance the expensive litigation that would have previously been unavoidable.
5. The greatest cost is, perhaps, the personal cost to all concerned, as I noted in my earlier judgment in these proceedings (Scott v Bodley at [17]).

Order: 1. Pursuant to the Uniform Civil Procedure Rules 2005 (NSW) r 28.2, the plaintiff has failed to establish serious harm to reputation as required under s 10A of the Defamation Act 2005 (NSW) and the proceedings are dismissed. 2. The plaintiff is to pay the defendant's costs of the proceedings, with liberty to apply.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 22 December 2022