Sherrington v Independent Commissioner Against Corruption & Anor; McCulloch v Independent Commissioner Against Corruption & Anor [2026] NTSC 25

Limitation Act 1981 (NT), s 12(2)(b)

Limitation of Actions Act 1958 (Vic), s 34(1)

Supreme Court Rules 1987 (NT), r 36.01, r 36.03

AGC Industries Pty Ltd v The Trustee for Trepang Services Unit Trust & Anor [2022] NTSC 30; Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175_; Bridge Shipping Pty Ltd v Grand Shipping SA_ [1991] HCA 45; (1991) 173 CLR 231; Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541; Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337; Commonwealth Bank of Australia v Barker (2014) 253 CLR_; Dow Jones & Company Inc v Gutnick_ (2002) 210 CLR 575; Hepi v Toyota Finance Australia Ltd [2025] VSC 121; Malik v Bank of Credit & Commerce International SA (In liq) [1988] AC 20; Pentridge Village Pty Ltd (in liq) v Capital Finance Australia Ltd (No 2) [2020] VSC 284; Sherrington v Independent Commissioner Against Corruption (NT) & Anor [2025] NTSC 27; Sherrington v Independent Commissioner Against Corruption (NT) & Ors [2022] NTSC 67; Sims v Jooste No 2 [2016] WASCA 83; University of Western Australia v Gray (2009) 179 FCR 346; Weldon v Neal (1887) 19 Q.B.D 394; Willmott Forests Ltd v Armstrong Dubois Pty Ltd [2016] VSC 61, referred to

Sherrington v Independent Commissioner Against Corruption & Anor; McCulloch v Independent Commissioner Against Corruption & Anor [2026] NTSC 25

[1] The plaintiffs, Jennifer Sherrington and Ian McCulloch, have each applied for leave to file and serve Further Amended Statements of Claim (FASOC) in their respective proceedings. The history of these proceedings may be found in my earlier decisions in Sherrington v Independent Commissioner Against Corruption (NT) & Anor [2025] NTSC 27 (Sherrington No 2) and Sherrington v Independent Commissioner Against Corruption (NT) & Ors [2022] NTSC 67 (Sherrington).

[2] The present applications result from orders made on 13 May 2025 entering summary judgment for the defendants on aspects of the plaintiffs' claims and striking out other parts of the plaintiffs' Amended Statements of Claim. As part of the orders made on that date, the plaintiffs were ordered to serve any proposed FASOCs by 1 July 2025, and the defendants were required to advise the plaintiffs whether they consent to the filing of the proposed FASOCs within seven days of receiving them.

[3] The plaintiffs duly served the defendants with proposed FASOCs. The defendants did not consent to the plaintiffs filing those FASOCs. By Summons dated 15 July 2025, in each proceeding the plaintiffs seek leave to file their FASOC. Each Summons states that the "application is filed in pursuance of Rule 36.01 (1) of the Supreme Court Rules and pursuant to Order of Burns J of 13 May 2025".

[4] Rule 36.01 of the Supreme Court Rules 1987 (NT) (SCR) provides:

(1) For the purpose of determining the real question in controversy between the parties to a proceeding or of correcting a defect or error in a proceeding or of avoiding multiplicity of proceedings, the Court may at any stage order that a document in the proceeding be amended or that a party have leave to amend a document in the proceeding.

(2) In this Order "document" includes originating process, an endorsement of claim on originating process and a pleading.

(3) An endorsement of claim or pleading may be amended under subrule (1) notwithstanding that the effect is to add or substitute a cause of action arising after the commencement of the proceeding.

(4) A mistake in the name of a party may be corrected under subrule (1) whether or not the effect is to substitute another person as a party.

(5) Where an order to correct a mistake in the name of a party has the effect of substituting another person as a party, the proceeding shall be taken to have commenced with respect to that person on the day the proceeding commenced.

(6) The Court may, notwithstanding the expiration of a relevant limitation period after the day a proceeding is commenced, make an order under subrule (1) where it is satisfied that any other party to the proceeding would not by reason of the order be prejudiced in the conduct of his claim or defence in a way that could not be fairly met by an adjournment, an award of costs or otherwise.

(7) For the purpose of subrule (6) any other party to the proceeding includes a person who is substituted as a party by virtue of an order made to correct a mistake in the name of a party.

[5] A party may amend a pleading served by them before the close of pleadings or at any time by leave of the Court or with the consent of all other parties: Rule 36.03 SCR. The plaintiffs require leave of the Court to make the proposed amendments.

[6] Some of the proposed amendments are not opposed by the defendants. I will not address those proposed amendments any further. Some of the proposed amendments are opposed only on technical grounds regarding how they are identified in the proposed FASOC (eg. double underlining etc). This is a matter on which the parties can surely reach agreement without my assistance. Additionally, many of the objections taken to the proposed amendments may fairly be described as nit-picking. With respect, no-one's interests are best served by such an approach, which simply serves to unnecessarily increase costs. The plaintiffs' will not be shut out from having legally legitimate claims heard on their merits through such an approach. It is in the interests of both parties to work towards putting the pleadings in order so that these proceedings may move forward.

[7] I will restrict my consideration to what I perceive to be the areas of substantive disagreement between the parties. These disagreements relate to the plaintiffs' proposed amended defamation claims and Mrs Sherrington's proposed amended employment claims.

[8] Both plaintiffs plead claims in defamation in their FASOC. Both plaintiffs plead their claim against the second defendant, the Northern Territory (Territory). It is relevant to note that each plaintiff pleaded a case in defamation in their earlier Amended Statements of Claim (ASOC). Those pleadings were somewhat confusing. In Mrs Sherrington's ASOC, her claim was pleaded under the heading "The Commissioner's and Territory's defamation" and was based upon an allegation that the Independent Commissioner Against Corruption (ICAC) had published material defamatory of her. Mrs Sherrington claimed that both the ICAC and the Territory were liable for the alleged defamation. There was, however, no pleading of how the Territory was said to be liable for any defamatory implications in that material. In particular, there was no general pleading in the Sherrington ASOC that the Territory is either directly or vicariously liable for the acts of the ICAC. At the time of hearing argument in Sherrington No 2, the plaintiff had made an application to amend her ASOC to "substitute" the Territory for the ICAC as the defendant to her claim in defamation. The result in Sherrington No 2 was that substantial amendments were required to the Sherrington ASOC if the plaintiff were to continue with aspects of her claim, including the claim in defamation, it was expedient to leave the resolution of the plaintiff's application to substitute defendants until after the plaintiff filed a proposed FASOC.

[9] In the case of Mr McCulloch, his claim in defamation in his ASOC simply pleaded liability on the part of the ICAC and not on the part of the Territory. This was despite the fact that his claim was also pleaded under the heading "The Commissioner's and Territory's defamation".

[10] It is against this background that the dispute regarding the plaintiffs' proposed pleading of cases in defamation in their FASOCs comes to be considered.

[11] The defendants submit that Mrs Sherrington's application to amend her defamation claim in the proposed FASOCs should be refused because:

a) Mrs Sherrington has not established any error in her pleading in the ASOC and therefore has failed to satisfy the condition precedent to the operation of rule 36.01 (1) of the SCR;

b) The proposed amendments are sought after the expiration of the relevant limitation period, and would cause the defendants irremediable prejudice such that rule 36.01 (6) of the SCR is not satisfied; and

c) The discretionary factors in this proceeding are such that, even if, contrary to the defendant's submissions, the application should be refused.

[12] In support of her application, Mrs Sherrington relied upon an affidavit made by her solicitor, William Piper, on 14 March 2025. The effect of the contents of that affidavit is that it was always the intention of Mrs Sherrington to make her claim in defamation against the Territory, but the ASOC was erroneously drafted to state that the claim was against the ICAC. The proffered explanation for the error was that the claims of both plaintiffs were originally drafted to be part of a single claim, but a decision was later taken to split the claims and commence separate proceedings in the names of each plaintiff. In submissions, the lawyers for Mrs Sherrington stated that the error in the ASOC arose as a result of multiple iterations of the ASOC and the transposition of the positions of the defendants as first and second defendants in the proceedings.

[13] The defendants did not concede the existence of this error. They submitted that an examination of the original SOCs and the ASOCs suggest that the plaintiffs always intended to sue the ICAC. The defendants referred to the decision in Bridge Shipping Pty Ltd v Grand Shipping SA[1] (Bridge Shipping). That was a case in which the plaintiff, Bridge Shipping Pty Ltd (Bridge), was engaged to arrange for the carriage of tobacco from Brazil to Melbourne. The plaintiff employed another company to arrange the carriage and was unaware of the identity of the selected carrier. In May 1986, the goods left Brazil on the vessel "Green Sand". Upon the ship's arrival in Melbourne, some of the tobacco was missing and some of it was damaged.

[14] The owner of the tobacco sued Bridge for damages. Bridge issued a third-party notice against Grand Shipping SA (Grand) which a search of the Lloyd's Register had revealed to be the registered owner of the vessel. Bridge later discovered that Grand had chartered the vessel to Rainbow Lines SA (Rainbow) and that Rainbow had been the carrier of the goods. By that time, the time for suing Rainbow for indemnity or contribution had expired. Bridge applied under r. 36.01 of the Victorian Supreme Court Rules to substitute Rainbow as a party for Grand.

[15] The terms of r. 36.01 of the Victorian Supreme Court Rules were effectively the same as those of r. 36.01 of the SCR. The question raised in Bridge Shipping was whether r. 36.01 of the Victorian Supreme Court Rules authorised the substitution of another person named as defendant in the action after the expiration of the relevant limitation period for bringing an action against that person. For that reason, the focus of the decision was on whether the circumstances in that case revealed a "mistake" in the name of a party so as to enliven the provisions of r. 36.01(4).

[16] McHugh J, with whom Brennan and Deane JJ agreed, considered the construction of r. 36.01 and concluded, at 260, that "a plaintiff may make "a mistake in the name of a party" not only because the plaintiff mistakenly believes that a certain person, whom the plaintiff can otherwise identify, bears a certain name, but also because the plaintiff mistakenly believes that a person who answers a particular description bears a certain name."

[17] In Bridge Shipping, therefore, if Bridge had commenced its action against Grand under the mistaken belief that Grand was the carrier of the goods, that would have been a mistake which r. 36.01 could be called upon to remedy. The evidence in Bridge Shipping, however, did not support the proposition that a mistake of that nature had occurred. The evidence established that Bridge had not intended to sue Grand as the carrier of the goods, but on the basis that Grand was the owner of the vessel. As McHugh said, at 262, "Bridge made no mistake as to description of the party which it wished to sue. It intended to sue the owner and did so... The mistake which Bridge made was that it believed that it had rights against the owner of the vessel. But that was not a mistake 'in the name of a party'."

[18] One matter of general importance which arises from the decision in Bridge Shipping is that r. 36.01 (4) is a remedial rule and should be given the widest interpretation which its language will bear: per McHugh J at 260-261. In my opinion, this applies to the provisions of

r. 36.01 generally. The present case is not a case of the plaintiff having mistaken the name of a party. At worst, it is a case of a different type of error and, a fortiori, the provisions of r. 36.01 should apply to ensure that the real question in controversy between the parties is heard and determined.

[19] The present case is very different to Bridge Shipping. I am satisfied that Mrs Sherrington intended to sue the person responsible at law for the publication of the material of which she complains. There can be no doubt that the ICAC published the material. The mistake made by the plaintiffs was in identifying the ICAC as the entity legally responsible for the publication. In that regard it is unimportant whether the error was a clerical error as submitted by the plaintiffs, or a decision to sue the ICAC in the erroneous belief that it was an entity that could be sued in defamation in its own right. If, as the plaintiffs submit, it was a form of clerical error, this is the type of error which r. 36.01 is intended to address: Bridge Shipping per McHugh J at 261. If the error was one of wrongly identifying the person or body responsible at law, this is also a type of error that r. 36.01 is intended to address: Bridge Shipping at 260. I am therefore satisfied that there has been an "error" in the proceedings as contemplated by r. 36.01 (1).

[20] The defendants submitted that r. 36.01 (6) provides that amendments to pleadings may not be made after the expiration of a relevant limitation period if that would mean that any other party to the proceedings would be made, subject to prejudice of a kind that could not be addressed by being forwarded more time or being compensated for the need to reformulate their case.

[21] The defendants submitted that r. 36.01 (6) is engaged by the present applications because the proposed claims in defamation against the Territory would be one brought after the relevant limitation period. The FASOC alleges publication of media releases on 5 July 2021, as well as the publication of various statements on the Department of Education's website from an unknown date to the present time. The defendants submit that an action in defamation is not maintainable unless commenced within a limitation period of one year from the date of publication: Limitation Act 1981 (NT) (Limitation Act), s 12 (2) (b).

[22] The position regarding the date of publication of the alleged defamatory material, and therefore the commencement and expiration of any relevant limitation period, is somewhat complicated by the fact that both plaintiffs plead in their proposed FASOC that publication is continuing. I will assume for present purposes that the plaintiffs' claims, or at least part of them, fall outside the limitation period.

[23] The defendants drew my attention to the decision in Hepi v Toyota Finance Australia Ltd[2] (Hepi) in which, the defendants submitted,

that Osborne J rejected a submission that the Victorian analogue to

r. 36.01 (6) allowed for amendment of existing claims without regard to limitation periods.

[24] The factual circumstances in Hepi were complicated and involved a question whether representative proceedings should be amended by adding a new defendant, new claims against an existing defendant and amending a group member definition to include additional group members having claims against the existing defendant and the proposed new defendant. Some of the new claims (against the existing and proposed defendants) may otherwise have been statute barred.

[25] I will interpolate at this point to provide some historical background to some of the issues raised in Hepi. In Weldon v Neal,[3] Lord Esher M.R. said regarding an application to amend a claim by adding a cause of action that would otherwise be statute barred, at 395:

We must act on the settled rule of practice, which is that amendments are not admissible when they prejudice the rights of the opposite party as existing at the date of such amendments. If an amendment were allowed setting up a cause of action, which, if the writ were issued in respect thereof at the date of the amendment, would be barred by the Statute of Limitations, it would be allowing the plaintiff to take advantage of her former writ to defeat the statute and taking away an existing right from the defendant, a proceeding which, as a general rule, would be, in my opinion, improper and unjust.

[26] The so-called rule in Weldon v Neale has been abrogated by statute in many jurisdictions. In the Northern Territory this is found in s 48A of the Limitation Act and r. 36.01 (6) of the SCR. The equivalent provisions in Victoria were s 34 (1) of the Limitation of Actions Act 1958 (Vic) and r. 36.01 of the Victorian Supreme Court Rules.

[27] Against this background, Hepi made a submission that the potential loss to the defendant or prospective defendant of an entitlement to rely on a limitation period was irrelevant to the application to amend. Osborne J summarised the submission, at [86] - [87], as follows:

[86] Hepi submits that the plain wording of r 36.01(6) of the Rules either alone or in combination with s 34(1) of the Limitations Act is such that prejudice occasioned by the expiry of a relevant period of limitation must be put to one side or, to put it another way, is not relevant prejudice for the purposes of determining whether it is appropriate to grant leave to amend. Hepi argues this is the clear consequence of the express wording contained in r 36.01(6) and s 34 and has been accepted by this Court in various cases notably Willmott Forests Ltd v Armstrong Dubois Pty Ltd[4] ('Willmott') and Pentridge Village Pty Ltd (in liq) v Capital Finance Australia Ltd (No 2)[5] ('Pentridge Village').

[87] Hepi argues that r 36.01(6) and s 34 take away a defendant's ability to rely upon the expiry of any relevant period of limitation in respect of an existing proceeding between a plaintiff and a defendant where a plaintiff seeks to raise by way of amendment an arguable claim against a defendant unless the defendant can point to another form of prejudice apart from the expiry of the relevant limitation period. Hepi submits that is so regardless of the nature of the amendment; in other words, it is open to a plaintiff to introduce an entirely new claim in respect of which the limitation period has expired provided the limitation period had not expired at the date of commencement of the proceeding. Hepi argues that if the amendment is granted, the commencement date of the new claim is deemed to relate back to the date of the original commencement of the proceeding.

[28] Osborne J observed that the loss of limitation defences reflect the loss of a substantive right and cited McHugh's observation in Brisbane South Regional Health Authority v Taylor[6] that a limitation period "represents the legislature's judgment that the welfare of society is best served by causes of action being litigated within the limitation period, notwithstanding that the enactment of that period may often result in a good cause of action being defeated". Osborne J went on to say, at [143] - [146] (footnotes omitted):

[143] Against the background, I do not accept that the amendments introduced by the 1986 Rules pursuant to r 36.01(6) (and now present in the Rules), coupled with the contemporaneous and apparently related introduction of s 34 of the Limitations Act, was intended to deprive a defendant of such a fundamental right; especially in the absence of any clear indication to that effect in any contemporaneous indicia. Additionally, it is unlikely that such a significant change would be made by amendment to the rules of court alone in such a way which would set Victoria on a course distinct from other states and from the United Kingdom. The interest of justice are not to be looked at only from the perspective of the plaintiff and the group members. Consideration must be given to the position of all parties.

[144] Nor does s 34 of the Limitations Act compel any such conclusion. The task of statutory construction must begin with the consideration of the text itself, but the meaning of the text may require consideration of its context and the mischief it is seeking to remedy. Further, it is a well-recognised rule of statutory interpretation that an Act will not be interpreted as taking away an existing right unless it is reasonably capable of no other construction. Equally well-recognised is the presumption that a court will not interpret legislation in a way which confines or limits the court's jurisdiction unless found in clear words. Even if one focusses solely on the text of s 34, I do not accept that the text casts aside or in some way bars consideration of the loss of a limitation defence. The text first requires a court to consider whether it would allow a party to amend a document in the proceeding but for the expiry of any relevant period of limitation. Those introductory words suggest that the initial focus is on whether a court would exercise the permissive power to grant leave to amend under r 36.01. In the context in which the section was enacted, which was to abrogate the rule in Weldon v Neal (as the sub-heading in the section suggests), the first stage of the enquiry therefore is whether the Court ought exercise its discretion to grant leave to amend but for a technical expiry of the limitation period. This was the Weldon v Neal vice. By couching the rule with respect to amendment in such general terms, I accept, as Glass JA did in McGee v Yeomans in relation to a similar rule, that the effect of the new r 36.01 in the 1986 Rules was to displace the rule of practice laid down in Weldon v Neal (and all its finespun distinctions) as it had come to be applied and replace it with a general discretion to allow an amendment notwithstanding that it raised a barred cause of action whenever justice so required.

[145] But that broad criterion does not by a side wind, give rise to a widespread abrogation of the right to rely on limitation statutes in all cases of amendment. The abrogation of the rule in Weldon v Neal does not require it and nor does the language of s 34(1) compel it. It is one thing to put to one side the subtle distinctions that bedevilled courts following Weldon v Neal. It is another thing entirely to effect a carte blanche removal of a substantive right in respect of the introduction of a new cause of action which could not have been introduced in a statement of claim filed after commencement by writ with general indorsement but which a defendant was powerless to resist. Noting too that whilst some limitation provisions may be found in State legislation, others such as some of those relied on by Toyota in this proceeding, are found in Commonwealth legislation. Some bar the remedy and have to be pleaded in a defence; others have the effect that the cause of action no longer lies or is extinguished unless a proceeding is commenced within a designated time. Some of those are present here; note for example the plea in paragraph 76 of the proposed ASOC (and equivalent pleas in relation to the statutory misleading and deceptive conduct claims). Such provisions have been held to be incapable of extension and to bar both the right to make the claim and the remedy. To interpret s 34(1) in a way which either removes a defendant's substantive right without regard to context, the balance of the Rules and the mischief which the section was intended to address, would as Ormiston JA observed in Agtrack produce a bizarre outcome. All the more so where the interpretation of such a provision may cut across Commonwealth legislation.

[146] Ultimately, whether the interests of justice require the expiry of a limitation period to be put to one side is to be approached as a matter of substance. Where a new statutory cause of action is sought to be introduced arising out of the same facts as those already pleaded, and a defendant is on notice that a claim is being made against it with respect to those same facts, the interests of justice are likely to favour amendment, notwithstanding that what is sought to be set up is technically a new cause of action. Similarly, an amendment which introduces new facts which are uncontroversial, is unlikely to provide a proper basis for opposition.

[29] In the present cases, each of the plaintiff's original SOCs and ASOCs pleaded causes of action in defamation substantially the same as those pleaded in their proposed FASOC. The Territory has been on notice from the outset of these claims that the plaintiffs' claim to have been defamed by the material in question and that they allege the material was published by a Northern Territory government entity (to use a neutral term). It must have been clear to the Territory that if, as it asserted in Sherrington No 2, the ICAC was not a body that could be sued in tort, then the appropriate body responsible in law for publication was the Northern Territory. The Territory must have been aware from the outset of these proceedings that it was on the cards that it would be the ultimate defendant to the defamation claims. This is not a case like Aon Risk Services Australia Ltd v Australian National University[7] where an application to amend a claim by adding a substantial new claim against the defendant was made by the plaintiff three days into a four-week trial.

[30] The defendant also submitted that the proposed amendments should not be allowed because they would be liable to be struck out or summarily dismissed. It was submitted that the proposed pleadings would be embarrassing in the sense that they do not state allegations sufficiently clearly so that the opposite party is left in no doubt as to what is alleged. There are several aspects of the revised defamation pleadings which the defendants submit are embarrassing in the sense.

[31] First, the plaintiff submits that properly pleading a cause of action in defamation in respect of Internet publications requires that a plaintiff specify the occasion or occasions on which the alleged defamatory material was downloaded, citing the decision in Dow Jones & Company Inc v Gutnick.[8] The cited passages do not directly support the proposition suggested by the defendants. It is true that the cited passages emphasise the rule that each communication of defamatory material founds a separate cause of action and that where allegedly defamatory material is posted on the World Wide Web it is only after the material is downloaded that damage to reputation may be done, but the decision does not support the proposition that particulars of every alleged download must be pleaded in a statement of claim.

[32] It will often be impossible for a plaintiff to provide particulars of each alleged download in originating process, particularly where, as here, it is alleged that the defamatory material remains on a website. That is not what is required to be plead in originating process. In Sims v Jooste No 2,[9] Martin CJ, with whom Buss JA and Mitchell J agreed, said regarding the need for pleading and proof of the downloading of allegedly defamatory material from the Internet, at [18] to [20] (footnotes omitted):

[18] In England, it has been consistently held that a plaintiff claiming to have been defamed in material posted on the internet cannot rely upon an inference of publication analogous to that customarily drawn in cases involving publication via the mass media of print or broadcast in order to establish that there has been substantial publication within the jurisdiction. Rather, the plaintiff must plead and prove that the material of which complaint is made has been accessed and downloaded. The English cases recognise however that publication, in the legal sense, may be established by pleading and proving a platform of facts from which an inference of download can properly be drawn. However, such an inference will not be drawn from the mere fact that the material complained of has been posted on an internet site.

[19] With one apparently anomalous exception, the same approach has consistently been taken in Australia. So, in Toben v Jones and MacDonald v Australian Broadcasting Corporation it was held that a plaintiff claiming to have been defamed by material posted on the internet must plead and prove facts which established that the material of which complaint was made had been downloaded and viewed by somebody, without necessarily having to provide particulars of the identity of the person or persons who downloaded the material. The cases also establish that an inference to the effect that the material of which complaint is made has been downloaded by somebody might be drawn from a combination of facts, such as the number of 'hits' on the site on which the allegedly defamatory material was posted and the period of time over which the material was posted on the internet. For example, in Scali v Scali screenshots of the defendant's YouTube posts, which appeared to demonstrate the number of times the allegedly defamatory videos had been viewed as at the date of the screenshot, were relied upon as evidence of the fact that the videos of which complaint was made had been downloaded and comprehended by third parties.

[20] Cavasinni v Camenzuli provides the one Australian exception to this line of authority. In that case, in deciding an application to strike out the statement of claim, Gibson DCJ distinguished the principle enunciated by the High Court in Dow Jones on the basis that that case concerned publication on an internet site only available to subscribers. In her view, in a case in which the relevant internet site was available to all, it was sufficient for the plaintiff to plead the jurisdictions in which publication was asserted, without pleading or proving specific facts from which an inference could be drawn to the effect that the material of which complaint was made had been downloaded. With respect to her Honour, I do not read the observations of the plurality in Dow Jones as being limited to cases in which complaint was made of material published on a site only available to subscribers. Nor is such a distinction consistent with the principles consistently enunciated in the English cases, or the other cases in Australia to which I have referred. For that reason, with respect, I would not follow the view expressed in Cavasinni.

[33] The deficiency in the plaintiffs' proposed pleading of their cases in defamation is that they contain no allegation that the alleged defamatory material has been downloaded and viewed by anybody or facts from which that fact may be inferred. The submission that because the websites hosting the material are government websites maintained for the express purpose of disseminating information, is not based upon any pleaded facts. In my opinion, the minimum requirement for a proper pleading of a case in defamation involving material on the internet is a pleading that the material has been downloaded and viewed by members of the public. It is not necessary that the plaintiffs plead each alleged instance of downloading. Further particulars of the number of downloads can await discovery and/or interrogatories.

[34] The second area of complaint by the defendants is that there is no pleading that, even if there were downloads of the material from the relevant websites, those downloads were caused by or resulted from the uploading of the material as pleaded by the plaintiffs. For my part, I would foresee little difficulty in determining that the uploading of the material to the relevant websites was a cause of any subsequent downloading, particularly if it was established that the websites were maintained for the purpose of providing information to the public. The plaintiffs may, however, care to address this before any final determination of leave to file their FASOCs.

[35] The defendants also submit that they have suffered prejudice by the delay in finalising the pleadings in these proceedings. They submit that they have lost the opportunity to take instructions from Mr Fleming KC, deceased, and to call evidence from him. In my opinion, the prejudice alleged by the defendants based upon the unavailability of Mr Fleming is more speculative than real. It would be expected that all matters relevant to the decisions made by the ICAC concerning these issues would be appropriately recorded in the records of the ICAC or the Territory.

[36] The final matter argued by the defendants was that even if the Court's power to permit the proposed amendments is enlivened, the Court should exercise its "residual discretion" not to grant the application because:

a) The mistake which is to be remedied by the proposed amendment is one that could have been avoided had more care been taken: AGC Industries Pty Ltd v The Trustee for Trepang Services Unit Trust & Anor[10] (AGC).

b) The proceedings are at an advanced stage, and the Court must take into account case management considerations: AGC at [39] and [56].

c) There has been a delay in making the application.

d) No adequate explanation has been given for the delay

[37] It would be fair to say that the plaintiffs' pleadings to date have not been exemplars of the draftsman's art, but I am satisfied that the plaintiffs should not be shut out from litigating claims that they have always sought to maintain regarding the publication of these materials because of pleading issues.

[38] The plaintiffs will be granted a further opportunity to re-draft their proposed FASOCs, and before filing, address the current deficiencies regarding the pleading of their defamation claims. With the above changes being made, I am satisfied that the interests of justice favour leave being granted for the plaintiffs to amend their defamation claims as proposed in their FASOCs.

Proposed employment claims by Mrs Sherrington

[39] The defendants submitted that the amendments to Mrs Sherrington's proposed employment claims should not be allowed because they would be liable to be summarily dismissed or struck out because:

a) The pleadings contending for an implied contractual term of good faith are inconsistent with the reasons published in Sherrington No 2.

b) The pleadings in respect of the proposed new cause of action in negligence are embarrassing and legally misconceived.

c) The pleadings in the proposed estoppel claim are "legally incoherent".

[40] In Sherrington No 2, I ordered that summary judgment be entered for the defendants regarding a pleaded contractual employment liability claim on the basis that the claim named the Department of Education (DOE) as the defendant and that body was not one that had a legal personality entitling it to contract with other parties. I went on say, at [73] to [75], omitting footnotes:

[73] It is strictly unnecessary for me to consider the other bases upon which the defendants submitted they were entitled to summary judgment regarding Ms Sherrington's pleaded employment liability claim, but I will briefly touch upon them.

[74] The second basis relied upon by the defendants concerned Ms Sherrington's pleading that the DOE breached an implied duty of good faith which it owed her. The defendants submitted that the test for implying terms into a contract are well known_._. Recently, these principles were succinctly stated by Kiefel CJ and Gageler J in Realestate.com.au Pty Ltd v Hardingham (2022) at [18] (omitting footnotes):

The conditions necessary to ground the implication of a term of well-known. Apart from being reasonable and equitable, capable of clear expression and non-contradictory of the express terms of the contract, to be implied a term must be necessary to give business efficacy to the contract (which will not be satisfied if the contract is effective without it), and it must be so obvious that "it goes without saying".

[75] The existence and content of an implied term is a question of law and "does not depend on the ascertainment of the actual intention of the parties to the contract". I accept the defendants' submissions that the requirements for implying terms of the nature asserted by Ms Sherrington into her employment contract are not capable of satisfaction in this case. I would have granted summary judgment to the defendants on this aspect of Ms Sherrington's pleaded case had it been necessary to consider it.

[41] The term which Mrs Sherrington sought to imply into her contract of employment was a term that her employer (wrongly identified at that time as the DOE) would act in good faith towards her and cooperate with her in assisting her to fulfill her duties. The duty of good faith which Mrs Sherrington seeks to plead against the Territory in her FASOC is not expressed in similar terms, but instead by particular obligations it is said that the Territory impliedly assumed towards Mrs Sherrington in the performance of her duties and in the exercise of its contractual rights.

[42] Regarding this last implied obligation, one of the particulars of the implied obligations in the Sherrington FASOC is expressed as an obligation to not rely on the results of any investigation to terminate or not renew the plaintiff's employment in circumstances where the Territory had not undertaken the obligations Mrs Sherrington says were implied into her contract of employment concerning the performance of her duties. The FASOC pleads factual circumstances which it is says affected Mrs Sherrington in the performance of her duties. It also pleads that Mrs Sherrington was "in a vulnerable and subordinate position" to the Territory in her employment. By reason of these matters, the FASOC pleads, at [50], that it was an implied term of her employment, as a matter of law and of fact, that "before terminating the plaintiff's employment, the Territory would act in good faith towards her".

[43] No matter how this issue is now pleaded, it is still an allegation that a duty of good faith is to be implied into Mrs Sherrington's employment contract. I indicated in Sherrington No 2 that, had it been necessary, I would have entered summary judgment for the defendants on her case as then pleaded, alleging the implication of a term of good faith. Mrs Sherrington sought to address this in her written submissions as follows:

2.1 The implied term of good faith in FASOC [50] is considerably different from that originally pleaded in that it is an implied term of good faith in the exercise of a power in her employment, that is the power of termination. This brings the implication within the High Court decision in Commonwealth Bank of Australia v Barker and cases since. Further, amendments and pleadings in developing areas of the law should not be disallowed summarily.

2.2 The new pleading is based on the plaintiff's vulnerability to the actions of the defendant due to the significant disparity of power between the parties as set out at FASOC [49]. The plurality in Barker said that the decision did not "reflect upon the related question whether contractual powers and discretions may be limited by good faith and rationality requirements". FASOC [50] is directed at the contractual power to terminate and alleges an implied duty of good faith in exercising that power.

2.3 Barker was decided on the basis of an implication by law in employment contracts generally. It left open the possibility of implication as a matter of fact on the usual principles of implication of contractual terms in fact. Kiefel J recorded that the questions whether a standard of good faith could apply to particular categories of contract (such as employment contracts) or to the contract there in issue, were not raised in argument.

2.4 Facts to be brought out in the interlocutory process and at trial relate, among others, to the relationship between the parties, the disparity in power, and the plaintiff's vulnerability to the NT's exercise of its powers. This cannot and should not be determined summarily on an application to amend.

[44] It is clear from these submissions that the intention of Mrs Sherrington is to allege that a duty of good faith is to be implied into her contract of employment with the Territory regarding the Territory's exercise of the power to terminate Mrs Sherrington's employment. The FASOC claims that such a term is to be implied as a matter of law and of fact. Terms implied "in fact" are terms embodying the contractual intentions of the parties as objectively determined. Terms implied "by law", to the contrary, are implied regardless of the objectively determined intention of the parties: see University of Western Australia v Gray[11] (Gray). The Full Federal Court in Gray said regarding terms implied by law that it is well accepted that such terms are legal incidents of the particular class of contract to which they relate: Codelfa Construction Pty Ltd v State Rail Authority of New South Wales.[12] Such terms are not based on the need to give efficacy to a contract.

[45] Whether the implied term proposed by Mrs Sherrington is said to arise by implication by law or on the specific facts in her case, the difficulty for Mrs Sherrington, as identified by the defendants, is that there is no allegation that Mrs Sherrington's employment was terminated by the Territory utilising any power of termination under her contract. The contract signed by Mrs Sherrington was for a period commencing 25 July 2017 and expiring 24 July 2021 "unless sooner terminated". There is no allegation that Mrs Sherrington's contract was terminated prior to 24 July 2021. By virtue of Determination 13 of 2011 of the Commissioner for Public Employment, the terms of which were incorporated into Mrs Sherrington's contract, if Mrs Sherrington's contract was not renewed by 24 July 2024, the contract terminated by operation of law.

[46] The decision in Commonwealth Bank of Australia v Barker[13] (Barker) does not assist Mrs Sherrington. That was a case in which an employee of the Commonwealth Bank who had been made redundant alleged that his contract of employment included an implied term of mutual trust and confidence. Such an obligation has been implied in employment contracts in the United Kingdom: Malik v Bank of Credit & Commerce International SA (In liq)[14] (Malik). The primary judge found that such a term was implied into Mr Barker's contract of employment and had been breached by the employer failing to take meaningful steps to redeploy Mr Barker as required by the employer's Redeployment Policy. That decision was upheld by a majority of the Full Federal Court.[15]

[47] In the High Court it was held that a term of mutual trust and confidence should not be implied into Mr Barker's employment contract by law or in fact. It is important to observe that the issue for determination by the High Court was restricted to determining whether an implied term such as that implied in Malik should be implied into Mr Barker's contract as a contract of employment. The broader, and somewhat different, issue of whether there is a general obligation to act in good faith in the performance of contracts did not arise. As such, at the present time, the question whether such a term is to be applied into a contract either by law or fact is to be addressed by established principles. As I found in Sherrington No 2, application of those principles cannot support the implication of such an obligation in Mrs Sherrington's contract.

[48] There would be no utility in permitting Mrs Sherrington to amend her claim to plead a duty to act in good faith.

[49] As part of Mrs Sherrington's employment claims, the FASOC alleges a breach by the Territory of a specific term of her employment contract requiring the Territory to conduct an annual review of Mrs Sherrington's performance under the contract. It is pleaded that if the performance review had been conducted, the Territory would or should have:

a) Informed Mrs Sherrington that her conduct was improper and should stop or be changed to be proper.

b) Given Mrs Sherrington an opportunity to cease, change or explain her conduct.

c) Indicated, by silence or otherwise, that her conduct was acceptable.

[50] It is alleged that by reason of this breach, Mrs Sherrington, inter alia, continued to engage in the conduct, which was found to be improper, had her employment contract terminated and was not offered further contracts with the Territory. Mrs Sherrington's claim relating to this alleged breach of a specific term of the contract is not challenged by the defendants in the present application. What is the subject of challenge, however, are provisions in the FASOC to the effect that the Territory is estopped from asserting that any of the alleged improper conduct on the part of Mrs Sherrington "justified non-renewal of her executive contract as principal of Milingimbi School".

[51] There is no pleading in the FASOC that the alleged estoppel gives rise to a right to damages. The stated operation of the estoppel, if the amendment is permitted, is to preclude the Territory from relying on Mrs Sherrington's alleged improper conduct as a basis justifying non-renewal of her executive contract.

[52] Mrs Sherrington's contract did not give her a right of renewal of her contract, but I accept that she would have been entitled to apply for a renewal of her contract. A decision was made by the Territory and communicated in writing to Mrs Sherrington by letter dated 7 December 2020 from the Chief Executive of the Department of Education that her contract would not be renewed. As that letter pointed out, at that time the investigation into Mrs Sherrington's conduct was ongoing.

[53] The letter states that no timeline for completion of the investigation was able to be provided and that it was important that the Milingimbi School community have stability during the extended investigation period. The letter states that the Chief Executive had formed the view that it was not in the best interests of the school, or Mrs Sherrington's welfare, that she return to the position of the principal of Milingimbi School. The letter stated that Mrs Sherrington was welcome to apply for advertised principal positions and that any such application would be assessed on merit.

[54] It is not pleaded by Mrs Sherrington that her contract would have been renewed but for those matters which form the basis of her action against the Territory. At best, as presently pleaded, her claim appears to be that she suffered the loss of a chance to have her contract renewed. Mrs Sherrington could succeed on this head of damage (assuming liability entitling her to damages is established), if it were established that there was a causal connection between the breach of the obligation for the Territory to conduct annual performance reviews, the conduct of Mrs Sherrington which was found to be improper, the decision to conduct an investigation into that conduct and the decision not to renew Mrs Sherrington's contract.

[55] As presently pleaded, the estoppel can only operate as precluding the Territory from relying on Mrs Sherrington's alleged improper conduct as justifying the non-renewal of her executive contract. That can only presently be relevant to the identified head of damages. It is possible, depending on what defences are raised by the Territory to Mrs Sherrington's claim for defamation, that her impugned conduct and its impropriety or otherwise, will become more broadly relevant, but the proposed pleading of estoppel in the FASOC does not go so far as to purportedly apply to any defence that may be raised to the claim in defamation.

[56] On the above basis, Mrs Sherrington will be allowed to amend her claim to plead the proposed estoppel.

[57] The next objection raised by the defendants concerns the pleading of a new cause of action in negligence in the FASOC. That pleading is particularly brief. The first paragraph pleads that as a result of the matters pleaded in FASOC [49], the Territory owed the plaintiff the duties set out in FASOC [45]. There is a clear error in this drafting because FASOC [45] does not plead any duty of care. Mrs Sherrington accepts that this is an error and the reference to FASOC [45] should be a reference to FASOC [50].

[58] Accepting that to be the case, the defendants nevertheless submit that the proposed pleading is deficient as the pleading in FASOC [50] sets out an alleged duty to act in good faith arising as an implied term of Mrs Sherrington's employment contract, not any duty of care. Additionally, the defendants submit that the duties alleged in FASOC [50] are framed at a level of specificity that conflates any cognizable duty to take care with alleged failures to take reasonable precautions.

[59] I accept the submissions of the defendants on this issue. The way in which the proposed claim in negligence has been framed is embarrassing in that it refers to the whole of FASOC [50] (accepting the reference to FASOC [45] is an error) as providing the duties owed by the Territory to Mrs Sherrington. FASOC [50] does not plead duties but pleads an implied term of Mrs Sherrington's contract of employment with obligations arising from the implied term. It may well be, as Mrs Sherrington stated in her written response to the defendants' submissions, that the intention was to plead the particulars in FASOC [50 (a)-(j)] as duties owed to Mrs Sherrington for the purposes of the law of negligence, but if that is the case it has not been clearly done.

[60] In any event, the way in which the proposed claim in negligence has been pleaded refers at many points back to the alleged contractual obligations advanced by Mrs Sherrington as part of her implied term pleading. As I have disallowed the proposed implied term amendment, the proposed negligence claim must be re-pleaded. It should be re-pleaded in the conventional manner, not in the ambiguous and convoluted way it is currently pleaded. I note the general submissions by the defendants that the common law would not impose on an employer a duty (sounding in damages) to take the steps referred to in FASOC [50]. I decline to rule upon that until Mrs Sherrington is given one final opportunity to properly plead her case.

[61] The final matter raised by the defendant concerns the proposed amendment to prayer for relief D. to include damages for "termination or non-renewal of her employment". The defendants submit that no cause of action for wrongful termination or for non-renewal has been pleaded and the amendment should be refused. In her written submissions in reply to those of the defendants, Mrs Sherrington submits that the prayer in D. refers to the breach of the implied duty of good faith. It follows that proposed prayer for relief D. should be disallowed. This will not preclude Mrs Sherrington relying on losses allegedly sustained by her by reason of non-renewal of her contract as a head of damage for the alleged breach by the Territory of any obligation to conduct performance reviews.

[62] I will defer making final orders at this time. Within 14 days of the publication of these reasons the plaintiffs are to file and serve revised FASOCs marked as agreed by the parties to show the proposed amendments. Leave is not granted to Mrs Sherrington to plead a further case alleging a breach of an implied term of her employment contract in the new FASOC. Leave is otherwise granted for the plaintiffs to revise the proposed FASOCs in accordance with these reasons. I will consider the revised FASOCs and make final orders on 24 April 2026.

[63] Costs of these applications will be reserved at this time.

[64] These proceedings were commenced in 2021 in the case of Mrs Sherrington and 2024 in the case of Mr McCulloch. The issues underpinning these cases have been known to the defendants since at least 2021. After nearly five years the proceedings are still bogged down in arguments over the plaintiffs' pleadings. This is simply not good enough. In part, the delay has been the result of poor drafting of the plaintiffs' claims. To a lesser extent, the defendants have also taken an overly fault-finding approach.

[65] I remind the parties that the over-arching purpose of pre-trial procedures "is to facilitate the resolution of the real issues of substance in dispute in proceedings justly, promptly, economically and in proportion to the nature of the dispute": r. 1A, SCR. Each party to these proceedings, and their legal practitioners, have a duty to the Court to further this overarching purpose: r. 1A.02 (1), SCR.

[66] I will from this point on personally case manage these proceedings. The proceedings will be listed at 9am on 24 April 2026. On that date the parties are to file a joint timetable for the preparation of these matters for hearing. I expect that the matters will be ready to be heard later this year or in early 2027.

[1] [1991] HCA 45; (1991) 173 CLR 231.

[2] [2025] VSC 121.

[3] (1887) 19 Q.B.D. 394.

[4] [2016] VSC 61.

[5] [2020] VSC 284.

[6] (1996) 186 CLR 541.

[8] (2002) 210 CLR 575 at [27] and [44].

[9] [2016] WASCA 83.

[10] [2022] NTSC 30 at [39].

[11] (2009) 179 FCR 346 at [135] to [136].

[12] (1982) 149 CLR 337 at 345.

[13] [2014] HCA 32; (2014) 253 CLR 169.

[14] [1988] AC 20.

[15] [2013] FCAFC 83; (2013) 214 FCR 450.