Vacik Distributors Pty Limited & Anor v Australian Broadcasting Corporation & Anor No.8

Background 1 The plaintiffs in these proceedings are Vacik Distributors Pty Limited ("Vacik") and its managing director Mr V Bates ("the plaintiffs"). The defendants are the Australian Broadcasting Corporation ("the ABC"), operator of the television station ABN2 TV, and Nationwide News Pty Limited ("Nationwide"), the proprietor of "The Daily Telegraph" newspaper ("the defendants"). The plaintiffs sue the defendants for damages for defamation. 2 In 1996, a book entitled "Smuggled 2" was published. The author was Mr R Hoser and the publisher was Kotabi Pty Ltd. At that time, Vacik was, among other things, engaged in processing and exporting kangaroo meat for human consumption, and Mr Bates was actively engaged in that part of the company's operations. 3 Proceedings were brought by summons issued by Vacik and Mr Bates against Kotabi and Mr Hoser, claiming an injunction to prevent further distribution of the book "Smuggled 2". The summons was heard and determined on 22 November 1996. The plaintiffs failed to secure the relief sought. 4 That night, 22 November 1996, the ABC seven o'clock news included an item relating to proceedings heard that day. It is that news item which is the matter complained of in the present proceedings as against the ABC. The text of the news item was as follows: "1_____________________ NEWSREADER

2A Melbourne author is fighting an attempt to ban his new book which alleges Newsreader: inset "LEGAL BIND"

3criminal activity within the National Parks and Wildlife Service of New South Picture of Kangaroo with copy of

4Wales. One of Australia's largest kangaroo meat processing companies is 5taking "Smuggled 2 "

6the action because of allegations it was involved in illegal dealings.

7Author, Raymond Hoser, claims the legal action to ban Smuggled Two is an attempt to Reporter voice over ("VO)

8stifle his right to freedom of speech. Picture: Hoser holding book

9The book describes the wildlife trafficking trade in Australia which appears to be Close up Hoser

10organised by senior officials within the New South Wales National Parks and Wildlife

12The book also names the Sydney based meat processing company Vacik Distributors V/O Picture: People at

13Mr Hoser claims there appears to be illegal dealings between the company and the work in unidentified meat

14National Parks and Wildlife Service, allegedly involving bribes of up to thirty thousand processing premises

16Today legal representatives for Victor Bates, the owner of Vacik, unsuccessfully V/O Pictures: Victor Bates

17attempted to ban the book. They claim it's defamatory and inaccurate and want it taken Legal representatives

19It's not the first time Mr Hoser's writing has come under fire. In 1993 the National

21and Wildlife Service attempted to ban his first book, Smuggled, which linked it to of Supreme Court

23And it appears to be an attempt to suppress any objective investigation into very serious Close up Hoser

24allegations of corruption that were not made by me but made by officers within the

25National parks and Wildlife Service and other senior government officials.

26Today's attempt to ban the book was rejected on the grounds that four thousand copies V/O

27have already been sold or distributed. Scenes of bookshop

28Vacik's legal representatives will know Monday if they can appeal the decision." Picture: Hoser holding book 5 The relevant feature of the ABC news item was the assertion that Vacik appeared to be involved in illegal dealings with the National Parks and Wildlife Service, involving bribes of up to $30,000, and that this was the case according to officers of the service and other senior government officials. This was not merely the report of an allegation made in a book. The allegation was fortified by the statement that the author of the book attributed the allegation to senior government officials. 6 A second summons was issued by the plaintiffs claiming the same relief but with additional evidence. The summons was heard on 18 and 20 December 1996. Judgment was given on 24 December 1996. 7 On 25 December 1996, the day following that judgment, an item appeared in "The Daily Telegraph" relating to the second unsuccessful attempt to obtain an injunction. It is that article which is the matter complained of in the present proceedings as against Nationwide. The text of the article was as follows:

1 The publisher of the book alleging corruption in the National Parks and Wildlife Service and a kangaroo-for-beef

2 substitution export racket has beaten a second bid to have the work banned.

3 Meat processing firm Vacik Distributors claimed it had been defamed in Smuggled 2: Wildlife Trafficking, Crime

5 Author Raymond Hoser alleged Vacik sold kangaroo meat overseas in place of beef and was involved in corruption

7 The book also includes a claim the company's managing director is a murderer.

8 The book has been available in bookshops and advertised on the Internet.

9 As of November 22, 4000 of the 6200 print had been sold.

10 Yesterday Justice John Dowd refused to order the book off bookshelves.

11 He said while some of the matters might be potentially defamatory they were "arguably defensible",

12 Kotabi Pty Ltd admitted publishing the work but denied it imputed all Vacik had claimed.

13 Justice Dowd said the meat export industry was the subject of much international controversy and enormous public

14 interest" 8 This also was not merely the report of allegations made in a book. The book was held out as an expose. The implication of describing the book in that way was to state by implication that the allegations in the book were true. The allegations were that Vacik engaged in illegal substitution of kangaroo meat for beef in the export beef market, that Vacik engaged in corrupt activities in conjunction with officers of the Wildlife Service, and that Mr Bates was a murderer. 9 Section 7A of the Defamation Act 1974 applied to these proceedings. In the first phase of the hearing, I determined that the matters complained of were reasonably capable of carrying the imputations pleaded by the plaintiffs and that the imputations were reasonably capable of bearing a defamatory meaning. A jury empanelled for the purposes of s 7A determined that the matters complained of carried the following imputations and that each such imputation was defamatory:

(a) Vacik had engaged in the illegal practice of bribing officers of the NSW National Parks and Wildlife Service.

(b) Mr Bates had engaged in the illegal practice of bribing officers of the NSW National Parks and Wildlife Service.

(a) Vacik had engaged in illegal substitution of kangaroo meat for beef in the export beef market.

(b) Vacik had engaged in corrupt activities in conjunction with officers of the NSW National Parks and Wildlife Service.

(c) Vacik was a disreputable company because it employed a murderer as its managing director.

(e) Mr Bates was derelict in his duties as managing director in that his company had engaged in the illegal substitution of kangaroo meat for beef in the export market.

(f) Mr Bates was derelict in his duties as managing director in that his company had engaged in corrupt activities in conjunction with officers of the NSW National Parks and Wildlife Service. 10 In relation to the ABC publication, the jury rejected a further imputation which the plaintiffs alleged arose, namely, that they had engaged in illegal wildlife trafficking. 11 Each of the defendants, by their respective defences, pleaded a defence pursuant to s 24(2) of the Defamation Act 1974 . Nationwide also pleaded defences pursuant to s 24(3) and (4). In a separate determination made during the hearing, I held that Nationwide had no defence in law pursuant to s 24(3) or (4). 12 In my judgment No 7 in the present proceedings, delivered on 16 December 1999, I found that defences pursuant to s 24(2) were not made out, and that each of the plaintiffs was entitled to a verdict against each of the defendants. On 21 December 1999 I directed the entry of verdicts accordingly. 13 In this judgment, I determine the quantum of damages to be awarded to each of the plaintiffs against each of the defendants.

The principles to be applied 14 Section 46(2) of the Defamation Act 1974 provides that where a person has been defamed the damages recoverable shall be "in accordance with the common law", but limited to "damage for relevant harm". "Relevant harm" is defined as "harm suffered by the person defamed" (s 46(1)). Damages, then, are for harm suffered by the plaintiffs. Section 46(3)(a) provides that exemplary or punitive damages are unavailable in defamation actions in New South Wales. 15 An award of damages serves three purposes according to the High Court in Carson v John Fairfax & Sons Ltd , (1993) 178 CLR 44. per Mason CJ, Deane, Dawson and Gaudron JJ, at 60-61: "The three purposes no doubt overlap considerably in reality and ensure that 'the amount of the verdict is the product of a mixture of inextricable considerations'. The three purposes are consolation for the personal distress and hurt caused to the appellant by the publication, reparation for the harm done to the appellant's personal and (if relevant) business reputation, and vindication of the appellant's reputation. The first two purposes are often considered together and constitute consolation for the wrong done to the appellant. Vindication looks to the attitude of others to the appellant: the sum awarded must be at least the minimum necessary to signal to the public the vindication of the appellant's reputation. 'The gravity of the libel, the social standing of the parties and the availability of alternative remedies' are all relevant to assessing the quantum of damages necessary to vindicate the appellant." 16 The law recognises two categories of compensatory damages: ordinary and aggravated damages. The distinction was considered by Hunt J in Bickel v John Fairfax & Sons Ltd : (1981) 2 NSWLR 474 at 496. "Compensatory damages are given to compensate the plaintiff for the harm done to him by the publication of the matter complained of; aggravated compensatory damages (which are also known as merely 'aggravated damages') are given to compensate him when that harm has been aggravated by the defendant's conduct in publishing that matter or by his subsequent conduct."

In this case the plaintiffs claim aggravated damages. 17 Damages may be assessed on an aggravated basis if the defendant's conduct is improper, unjustifiable or lacking in bona fides: Triggell v Pheeney , (1951) 82 CLR 497 at 514. and causes harm to the plaintiff. Aggravated damages do not give rise to a separate head of damage. This was explained by Higgins J in Costello and Abbott v Random House Pty Limited : [1999] ACTSC 13 at [411]. "The concept of 'aggravated' damages is not, whether calculated separately or not, a different 'head' of damage. It focuses on the circumstances of the wrongdoing which have made the impact of it worse for the plaintiff. It is not to go beyond compensation for the aggravation of the harm to repute or feelings. It is not a means for punishing a defendant."

The reputation and standing of the plaintiffs 18 In assessing damages, it is permissible to have regard to the reputation of the plaintiffs before they were defamed: Tingle and Anor v Harbour Radio Pty Ltd and Anor (1999). Aust Torts Reports 81-510 at [11]. Higgins J said in Costello and Abbott v Random House Pty Limited : at [287]. "It is legitimate, in assessing general damages, to have regard to the nature and extent of the reputation enjoyed by the plaintiff before he or she was traduced. This may have the apparent effect that those who have high community profiles, such as politicians, lawyers, actors and public commentators, will receive a higher award than a person with a lesser public profile, though similarly traduced."

(1) The reputation and standing of Vacik 19 As at November and December 1996, the Vacik company was the largest kangaroo meat processing firm in Australia. It produced kangaroo meat for the pet food trade, kangaroo meat for human consumption, and kangaroo skins for overseas and local markets. It had approximately a 50% share of the market for kangaroo meat and it was the only company producing kangaroo meat for human consumption in New South Wales. 20 Vacik employed approximately 210 people on a permanent basis, plus contract workers varying in number from 200 to 300. It contracted with some 300 to 400 shooters. It had two processing plants and some 200 refrigerated depots in Queensland and New South Wales. The company had an annual turnover of approximately ten million dollars.

Evidence was given concerning the reputation and standing of Vacik as at November and December 1996, principally by Mr H.M. Mulligan, general manager of the Vacik group of companies, the Hon. Ian Armstrong, previously deputy premier and Minister for Agriculture in the state government, Mr M.D. Ward, regional manager for the mid-west region in the state National Parks and Wildlife Service, previously with the Australian National Parks and Wildlife Service, and Mr J.E. Carter, Chairman of the Australian Beef Association. 21 I make the following findings. Vacik had a very high commercial reputation. Its payment cheques were considered as good as cash in the hand. The kangaroo meat industry had been virtually developed by the company, including the development of standards which came to be adopted by government. The company, which was regarded as a hard but fair competitor, had a reputation for fair dealing. It was the acknowledged leader in the industry and was held in high regard by government agencies such as the National Parks and Wildlife Service. The company had re-established an abattoir at Forbes, to the considerable benefit of the local population, and was held in high regard especially by the people in that district.

22 Evidence was given by the same witnesses in relation to the reputation enjoyed by Mr Bates in the industry. He and the company were regarded as synonymous. He had convened the first meeting of the Kangaroo Industry Association of Australia, in which persons and companies engaged in every facet of the industry came to be represented. Some forty to fifty companies became members of the Association. Mr Bates represented Vacik on the Association. He was regarded as the founder of the kangaroo meat industry in this country. 23 I accept that Mr Bates was admired and respected by others in the industry. He had a personal reputation for tough but honest dealings. Others in the industry often sought his advice. He had a high reputation in the Forbes district especially as a result of re-establishing the local abattoir. He was also highly regarded in the sport of camp drafting, which had taken him to many places where he became well known. 24 Evidence was given that Mr Bates had been particularly active in dealings with government in relation to the kangaroo meat industry. He had procured the establishment of an inspection service so that kangaroo meat could be sold and exported for human consumption. He had dealings with government at a state and federal level. Regularly consulted on a variety of issues concerning the industry, he played a major role in the development and introduction of regulations for the sale of kangaroo meat for human consumption. I find that he was held in high esteem in government circles. 25 Evidence was given concerning Mr Bates' family and personal associations by Mr D.J. Martin (a friend and neighbour), Mr G. Bates (Mr Bates' son), Mr J.E. Rushton (another friend), as well as by other witnesses I have mentioned such as the Hon. Ian Armstrong and Mr Mulligan. 26 I make the following further findings in this regard. Mr Bates had a keen sense of family loyalty, and had a reputation for generosity towards members of his family and towards friends. He had provided considerable personal and financial support to the Luddenham Show Society. He had been an excellent horseman and had competed extensively throughout the country. He had an extensive reputation in the sport of camp drafting among people in the farming community and he bred horses for this sport. He was highly regarded by personal friends including persons associated with the Royal Motor Yacht Club at Pittwater, of which he was a member.

Previously damaged reputations? 27 It was contended by the defendants that the reputations of the plaintiffs had been under a cloud since allegations were made against them in 1992, that the ABC and Daily Telegraph publications merely reinforced allegations that had already been made against the plaintiffs. This, it was argued, mitigated whatever damage the publications may have caused. 28 Counsel for the plaintiffs acknowledged the existence of previous rumours and allegations, but argued that the plaintiffs' reputations were unaffected by them at the time of the subject publications. The plaintiffs claimed that the publications, which are the subject matter of these proceedings, were particularly hurtful and damaging in that they gave life to old rumours, amounting to "a blow upon a bruise" as it was put. It is necessary to review the history of those allegations. 29 Allegations against Vacik and Mr Bates had been made prior to the publication of "Smuggled 2" in October 1996. These appear to have been initiated by a Mr S. Gordon, who was, between 1979 and 1982, an ATSIC Commissioner and coordinator of the Western Legal Service at Dubbo. Claims involving bribery of Wildlife Service officials were made by Mr Gordon against a Vacik company and Mr Bates in an interview on a regional radio station of the ABC in 1981. The Vacik company and Mr Bates sued Mr Gordon and the ABC, and the proceedings were settled. In 1985 allegations of corrupt dealings were made in a "Four Corners" program. 30 Seven years later, in 1992, Mr Hoser covertly taped a conversation with Mr Gordon. In that conversation, Mr Gordon made assertions concerning corruption and deaths involving the Wildlife Service and Mr Bates. A transcript of the tape recording was tabled in the Federal Parliament and reproduced in the Melbourne "Sunday Herald Sun". Articles critical of Vacik and Mr Bates, with mention of corruption and killings, appeared in the Melbourne "Sunday Herald Sun", and also in the Brisbane "Courier Mail". Shortly after, however, Mr Gordon publicly withdrew the assertions he had made. 31 Vacik and Mr Bates commenced proceedings in 1993 in relation to the publication in the Melbourne "Sunday Herald Sun" and also against the Brisbane "Courier Mail". Those proceedings have not come to trial. 32 Three years passed. Mr Hoser's book "Smuggled 2", published in October 1996, propounded the rumours which had, it seems, been initiated by Mr Gordon but long since withdrawn by him. 33 For a defendant to establish that a plaintiff's reputation was already damaged at the time of the relevant publication, it must show that the damaged reputation was a settled one. It is insufficient for a defendant to establish that a plaintiff's reputation has been tarnished temporarily at some time prior to the publication. Nor is lasting damage to reputation to be inferred merely from prior adverse rumour or prior defamatory publications which might have affected reputation. In Dingle v Associated Newspapers [1961] 2 QB 162. Holroyd Pearce LJ said at 180-81. : "…[I]t is plain that it is evidence of the plaintiff's bad reputation and not the evidence of rumours or incidents that might make it bad which is admissible in mitigation…Can it here be said that there was some evidence of the plaintiff's bad or partially bad reputation? In my judgment there was none. Evidence of bad reputation must be properly proved. It is a grave matter. One is not entitled to assume without evidence that the plaintiff's reputation must have changed in the four weeks following the publication of the report. As the months went by such report if uncontradicted would, no doubt, have its effect on his reputation, especially if it was succeeded by other similar matters; and the plaintiff's reputation might in due course become bad and be proved bad against him. No doubt the public unmasking of a villain or a conviction in a court of law will have a more immediate effect. But when the defendants' libel was published the plaintiff was a man of good reputation who had recently had something damaging attributed to him. A man's reputation in the sense in which the word is used in civil or criminal courts does not alter daily as good and bad deeds are ascribed to him. It is the judgment of his fellows on his general life over a period."

At their highest, the allegations in this case amounted to no more than unsubstantiated rumour. They had become well-known as such in the industry. I find that they had no lasting effect on the reputation of the plaintiffs.

Mr Bates' view of himself 34 In order to understand what personal distress and hurt may have been caused by the publications, it is necessary to consider the self-perception of Mr Bates. Mr Bates' view of himself was very much integrated with the business which he ran. The business was founded by him and he had been in charge of it from its inception. He had first become involved in the commercial use of kangaroo meat as early as 1959, and had been managing director of Vacik since its formation in the late 1960s. 35 I accept that Mr Bates was proud of the company's reputation for product excellence, and was proud of his personal achievements in the industry. He regarded himself - for good cause - as having been the true pioneer of the kangaroo meat industry, and as having been principally responsible for its development to the scale which it had achieved. I accept the evidence that Mr Bates felt the effects of the imputations the more keenly because of his own high reputation and that of his company and because of his justified view of himself.

Mr Bates' response to the ABC broadcast at the time of the broadcast 36 I accept Mr Bates' evidence of his reaction to the ABC broadcast. He had a feeling of disbelief that the ABC could be so unfair in publishing what he regarded as a one-sided version of the court proceedings, by giving Mr Hoser the opportunity to comment on them, and by not giving him that opportunity. There was also the failure to report that the allegations of corruption had been withdrawn, which was particularly irksome to Mr Bates. 37 Mr Bates was also particularly distressed about his face having been shown as the person associated with these unsavoury allegations, particularly that his face had been shown in country areas where he was well known. I understand this reaction. The juxtaposition of the face said, "This is the man who did these things". Mr Bates was, in effect, paraded as a criminal before people he knew and the viewing public. It was a shaming process. Mr Bates felt it as such. 38 Mr G. Bates (Mr Bates' son) gave evidence, which I accept, that when he spoke to his father the next morning his father was very stressed and distraught. He had never seen his father like that before. His father's eyes were bloodshot, his face was red, and he was having trouble getting his words out. He appeared to his son to be on the brink of tears, more upset than angry. Mr G. Bates confirmed that the most distressing feature of the broadcast to his father had been the depiction of his father's face. 39 Mr Martin telephoned Mr Bates following the ABC news program. Mr Bates said it was a lot of baloney, and politely hung up to take other calls. However, in subsequent conversations with Mr Martin, Mr Bates was quite upset, sufficiently to lead Mr Martin to change the subject out of consideration for his feelings.

Mr Bates' response to "The Daily Telegraph" article at the time of its publication 40 Mr Bates' response to "The Daily Telegraph" article was much more severe. He felt devastated and "bawled like a baby" when he read the article. It took him five or ten minutes to gain control of himself. He said that the impact of the newspaper on him was greater than the radio broadcast because he regarded "The Daily Telegraph" as reputable and authoritative. He thought what that newspaper published was likely to be taken seriously and as being authentic. 41 Mr Bates had gone out to get the paper. When he returned to the house his son observed that his father had been crying. He had only ever seen his father in such a state when there had been a death in the family, or when he had faced difficult personal issues. He saw his father huddled with his mother and sister and they were all crying. 42 Later that day - Christmas Day - Mr Bates and his wife hosted a family lunch, as they did each year. Mr Bates saw the need to mention the article to each member of the family, denying that it was true. This put a dampener on the party, and everyone left earlier than usual. That is not a large matter in itself but it is part of the evidence which shows the effect of the publication on Mr Bates. Mr Martin said that, at this time, Mr Bates was absolutely devastated. He told Mr Martin that thousands of people would have seen the article, and that he could never remove the mud. 43 I find that Mr Bates was extremely distressed by The Daily Telegraph publication.

The aftermath of the publication 44 Mr Bates went on holiday to Port Stephens, shortly after the Telegraph publications. He often went there. He mixed in a boating fraternity. He felt he had an obligation to bring the matter to the attention of the people he came into contact with because, as he put it, he, himself, would not have dealt with anyone whom he felt could be a murderer. He felt the need to state his case, to give a balanced account and to let others be the judge. I infer he felt considerable apprehension as to whether the people he spoke to would accept his denial of wrongdoing in the face of the article. 45 In the course of that holiday, the Hon. Ian Armstrong met Mr Bates and his wife socially at Nelson's Bay. Mr Bates took the Hon. Ian Armstrong aside and told him about the allegations. He was in a distressed state. 46 While he was out on the boat with Mr J.E. Rushton, Mr Bates looked edgy, prompting Mr Rushton to ask what was the matter. Mr Bates told him of the ABC broadcast and "The Daily Telegraph" article. Mr Bates told him he was upset because of the effect the publications would have on his family. 47 Mr Bates continued to be upset after the Port Stephens holiday. Mr G. Bates and Mr Martin attested to this. When he returned from holiday, Mr Bates told Mr Martin that he could not go out among friends. In Mr Martin's estimation Mr Bates had "just lost it" and "wasn't himself any more". 48 Mr Bates continued to feel the need to speak of the publications to family and friends, denying the imputations. For example, he spoke to a Mr D. Hardy in February 1997, describing the substance of what had been alleged, and as Mr Bates put it, trying to reinforce that these matters were completely untrue. He had a similar conversation with Mr Ward. Mr Bates said that he had to make opportunities to refute the allegations because they were not the kind of thing that others brought up. 49 Mr G. Bates' father-in-law had raised "The Daily Telegraph" article with him, asking if there was any truth in it and asking him to explain it and how it had come about. The implication was that the father-in-law thought there might well be truth in the assertions and conveyed that to Mr Bates. 50 Mr Mulligan said that when Mr Bates told him about the publications after returning from holiday, Mr Bates said he would do whatever he had to do to clear his family name and his company name, and the reputation of his children and grandchildren. This was an understandable reaction. Reputation is inherited by association. To pass on a good reputation is a matter for pride. Mr Bates felt the effect on his own reputation more keenly because it affected what people would think of his family. That, in all events, is how he saw it, and not unreasonably so. When speaking to Mr Mulligan, Mr Bates became extremely emotional and upset, and had difficulty expressing himself. He was crying, flushed in the face, and was clenching and unclenching his hands. Mr Bates suggested to Mr Mulligan that Mr Mulligan might not wish to work for him any more. This was further evidence that Mr Bates believed people were likely to think much less of him because of the publications. 51 Some time in the first three months of 1997, when the factory was short staffed, Mr G. Bates and his father had worked together at the factory. His father had commenced to weep again. Mr G. Bates had never seen his father break up in that way at work on any previous occasion. The emotional impact of the defamation continued. 52 Mr Bates had found it necessary to speak to four of his office staff about these legal proceedings when they were being prepared, because they would learn of the matter from faxes and telephone calls. He had wanted his staff to hear his side of the story. He broke down in the course of doing so, could not continue, and had had to leave the meeting.

The residual effects of the publications 53 Mr Bates ceased to be as actively engaged in the public face of the business as previously. Mr Bates told Mr Carter that he felt an outcast in the circle of committees in the meat industry and still felt devastated about the imputation that he was a murderer. He felt that, as a result of "The Daily Telegraph" publication in particular, the business did not hold the same interest for him as it once did. He continued to be concerned that there were people who would think a lot less of the company than they had in the past. He found this difficult to handle after the effort he had put into building up the company. 54 I accept that Mr Bates underwent something of a personality change following the publications, and mainly as a result of "The Daily Telegraph" article. He became more indecisive, less fluent in speech, less self confident, less forward looking. That was the opinion of Mr Bates' son, and I accept it as being so. He stepped back from his previous role in the company, pushing his son and Mr Mulligan forward in his place as the company's representatives. 55 From early 1997, Mr Mulligan rapidly took over Mr Bates' role in the management of the company, to the extent that, as Mr G. Bates put it, people dealing with the company now believed that Mr Mulligan was in charge. Mr Martin confirmed that Mr Bates had lost confidence in himself, including in his business dealings. Prior to the publications, he said, Mr Bates had been decisive, optimistic and happy. He became short tempered and grumpy, and the atmosphere in the family home was not the same. Mr Martin attested to Mr Bates being so worried about what people thought of him that on one occasion he needed someone to go with him to Camden for the cattle draft because he was worried about the reactions of others. He was always ruminating over the trial of the present proceedings. 56 Mr Bates withdrew almost completely from the contact he once had with various government departments. This occurred after the 1996 publications. Mr Bates has also kept away from industry meetings. 57 In a nutshell, Mr Bates ceased to enjoy his life as before. 58 Mr Bates has felt a continuing need to clear his name and what he regarded as his family name for the sake of the children that followed. He regarded that as being the purpose of bringing the present proceedings. He told Mr Rushton that he could not let such accusations hang around for his family's sake and for the good of the children. Mr Martin confirmed that Mr Bates was distressed because of the effect of the publications on his wife and family. Mr Bates told Mr Martin that he believed there were some people who still thought he might be a murderer.

Aggravated damages 59 The plaintiffs asserted a number of matters of aggravation. These are: (1) the falsity of the matter complained of and the imputations

(2) the failure of the defendants to make enquires of the plaintiffs, and a reckless failure to check the accuracy of the publications (3) the defendants' failure to retract and apologise

(4) the defendant's conduct of the proceedings (5) the defendant's omission from the article of any reference to the matters set out in the Reply, para 2 (g) (i)-(v).

(1) The falsity of the imputations 60 Aggravated damages are available when hurt to the feelings of the plaintiff has been aggravated because he or she knew that what was said about him or her was false. This ground is not available to the corporate plaintiff because the falsity of the imputation goes only to injury feelings: Comalco Ltd v ABC ; (1985) 64 ACTR 1 RSPCA v 2KY Broadcasters Pty Ltd ; Unreported, 9 December 1988, Hunt J. Lewis v Daily Telegraph . [1964] AC 234. The imputations contained in the publications were false. Mr Bates was aware of this. It exacerbated the hurt. 61 In the case of the ABC broadcast , Mr Bates said that his anguish was made worse by the fact that his face was shown at the same time that the false statements were made. I have referred to this. He said: "My reaction to those words (of the broadcast) and the words of the book that I had read previously: that every assertion, every comment made in respect of myself and my company was absolutely false and to see those false accusations on television with the profile of my face, I just couldn't believe it." (at T126) 62 In the case of "The Daily Telegraph" publication, Mr Bates gave evidence that he was adversely affected not only because the imputations were false but also because the article made claims that the book did not. Worse, one of the imputations, that of being a murderer, was of the most serious kind. It was false and I accept that it caused Mr Bates particular anguish: " Q . Could you tell his Honour what your feelings were when your eyes fell on the words, "The book also includes a claim the company's managing director is a murderer?" A . I just completely couldn't believe that a reputable paper and respected paper such as the Daily Telegraph would print such a false and untrue report of a court proceedings. Q . What were your feelings when you read it (ie the Telegraph piece)? A . Well, I was completely devastated. I remember, I just broke down, I couldn't do anything else but. Because firstly - I am of course aware that every insinuation or accusation is completely false and untrue, had been present in court when the author of the book had under oath made the statement that he didn't believe that I was a murderer or that I have any part in the murders…And further, that there had been tendered in evidence to the Court three affidavits which clearly repudiated the claims or adverse comments in the book about me and my company." (at T137) 63 Nationwide relies on the decision of Hunt J in Waterhouse v Broadcasting Station 2GB Pty Ltd (1985) 1 NSWLR 58. and submits that there is no requirement that the reported allegations be true or that Nationwide was required to have a belief in their truth. Hunt J said: "There is no requirement that the defendant have an honest belief in the truth of what is reported. No doubt he should have an honest belief in the substantive accuracy of the report, but if the report turns out to be substantially inaccurate then no question of good faith or of the defendant's state of mind arises." (at 58)

This, however, was said in the context of the defence of a fair and protected report. It is not a ground for arguing against falsity as a matter of aggravation.

(2) Failure of the defendants to make enquires of the plaintiffs, reckless failure to check the accuracy of the publications 64 Failure to make enquiries of the plaintiff may be a matter of aggravation. The failure to make inquiries will only be relevant to the issue of aggravated damages if the failure was unjustifiable, improper or lacking in bona fides and it exacerbated the plaintiff's hurt. According to Hunt J in Waterhouse , it could only be so if some obligation arose for the defendants to make such an enquiry and the defendants failed to meet that obligation.

The ABC publication 65 Mr Bates' claims that the ABC's failure to check the accuracy of its broadcast, by making enquiries of Mr Bates or by putting Mr Hoser's account to Mr Bates for comment was unfair particularly in view of the seriousness of the imputations in the broadcast material. 66 Mr Bates gave evidence that he was available to answer questions. He said that he had attended court on the 22 November 1996 for the proceedings before Levine J (and for the proceedings before Dowd J on the 24 December 1996), saw the ABC reporter interviewing Mr Hoser but that no one approached him. He said: "I felt it was unfair that I wasn't given the opportunity to comment; it was all Mr Hoser. I felt it was unfair that the ABC should in my opinion at that stage stoop to getting 11 year old footage and produce that footage with my name, with my face clearly visible, and there was no, in my opinion, balanced report." (at T126) 67 Counsel for the ABC said that the whether the report was unfair or not, the first defendant's conduct was neither lacking in bona fides nor unjustifiable. First, the reporter may not have known that Mr Bates was present at the proceedings. Second, Mr Hoser was interviewed (and Mr Bates was not) because Mr Hoser was the one who gave evidence in the witness box (while Mr Bates did not). Finally, it was claimed that it is very common practice to interview only one party to the proceedings for the purposes of a court report. 68 In my view, the ABC had an obligation to make enquiries because of the seriousness of the allegations which went beyond fair reporting of the court proceedings and because of the doubtful reliability of the proponent. In breaching that obligation the ABC's conduct was unjustified and lacking in bona fides and it exacerbated the injury to Mr Bates.

The Telegraph publication 69 According to Mr Bates, "The Daily Telegraph" publication was unfair. It was unfair because Nationwide failed to make enquiries to ensure that the article was accurate and this failure was unjustifiable and lacking in bona fides. 70 Insofar as the publication was not a fair report of what was said in court, ie. the judgment delivered by Dowd J, this publication also conveyed very serious allegations of criminal behaviour of the worst kind. Aggravated damages are attracted for the same reason as arise in relation to the ABC broadcast.

(3) Failure to retract and apologise 71 This is not an allowable basis on which to claim aggravated damages: Carson v John Fairfax and Sons Ltd , (1993) 178 CLR 44. per Mason CJ, Deane, Dawson and Gaudron JJ. at [45].

(4) Conduct at trial 72 Mr Bates submits that the way in which counsel for the ABC conducted the proceedings aggravated the hurt to his feelings. Specifically, he submits: (a) in cross-examination of the plaintiff : "Would that [a broadcast about corrupting the National Parks and Wildlife Service] not have reinforced what they already thought of you?" (at T163)

(b) in cross-examination of the plaintiff's son: "Your father wasn't really all that upset after any of these publications was he?" (at T251) This can be regarded as a circumstance of aggravation only if counsel acted improperly, unjustifiably or without bona fides: Triggell v Pheeney (1951) 82 CLR 497. per Dixon CJ, Williams, Webb, Kitto JJ. at 514 . If the assertions of counsel were made pursuant to a defence available to the defendant or were made in the course of addressing the issue of damages, they would not provide a basis for aggravated damages: Carson v John Fairfax & Sons Ltd (1993) 178 CLR 44. per Brennan J. at 21. 73 The ABC denies that it exacerbated the hurt to Mr Bates in cross-examining him. It also submits that the offending questions were part of a 'logical consequential line of questioning", with a view to establishing that there was no connection between the hurt he claimed he suffered and the ABC's publication in particular. 74 In Howlett & Anor v Saggers & Anor , Unreported, 24 April 1998, Donovan AJ. it was held that "attempts to prove earlier hurt from adverse publicity against [the plaintiff] did not...amount to an unjustifiable action." (at [18]). I agree. The actions of the ABC, therefore, were not unjustified or lacking in bona fides. This head of aggravation fails.

(5) The omission of certain matters from "The Daily Telegraph" article 75 It is asserted that Nationwide omitted to mention the following matters in "The Daily Telegraph" article of December 25 1996. The plaintiffs particularise these matters in their Reply at para 2 (g) (i)-(v): (1) that Mr Hoser was a convicted perjurer;

(2) that Mr Hoser had given sworn oral evidence during the course of the proceedings reported on that he was not alleging in the book that Mr Bates was responsible for a murder and he did not believe Mr Bates to be a murderer;

(3) that Mr Carter's sworn affidavit exonerated Mr Bates from any wrong doing in the meat industry and that the Royal commission had revealed no evidence of this;

(4) that Messrs Macqueen and Gordon had sworn that allegations about the plaintiffs involvement in corruption and meat substitution was false; and

(5) that Mr Gordon, the chief source of the references to meat substitution and corruption found in the book, had withdrawn allegations about the involvement of the plaintiffs in murders. 76 This claim arises from the fact that three affidavits were read in the proceedings referred to by Nationwide in its article of 25 December 1996, affidavits which directly denied the allegations which were contained in the book which was the subject matter of the proceedings. The affidavits were: 1. Mr Steve Gordon's affidavit that he had lied about Mr Bates' involvement in certain murders

2. Mr MacQueen's account of a meeting held his office where another company was mentioned in the context of bribery of National Parks and Wildlife Officers

3. Mr John Carter's affidavit denying that Vacik had any role in the meat substitution racket

Also relied upon was Mr Hoser's denial during cross-examination that Mr Bates was a murderer. 77 This head of aggravated damages is not available. In my judgment No. 7, given on 16 December 1999, I held that the parts of the article which give rise to the defamatory imputations were not a report of legal proceedings, but rather a report of what was in Mr Hoser's book. That being so, Mr Bates has no foundation on which to assert that the article was an unfair report of the proceedings for lack of completeness and balance or in any other respect.

Harm to the plaintiffs' reputation 78 In assessing damage to reputation, a number of matters are relevant. First, there is the seriousness of the imputations. The plaintiffs submit that the imputations conveyed by both the ABC and the "The Daily Telegraph" publications were all of criminal conduct of a most serious kind. In the case of the publication by the ABC, the imputations are that both Vacik and Mr Bates engaged in bribery. In the case of the publication by Nationwide, the imputations include involvement in illegal meat substitution and corruption by Vacik and Mr Bates, and of murder by Mr Bates. 79 Secondly, it is necessary to look at the circumstances of the publications: Costello and Abbott v Random House Pty Limited ; Tingle and Anor v Harbour Radio and Anor . Being a television broadcast, the ABC publication was fleeting and short. In this respect it is like a radio broadcast: Tingle per Kirby J at [117]. Television viewers cannot, in the ordinary course, return to the text of the publication to check or recheck its contents. 80 The size of the viewing audience is also relevant. The audience was very large. The ABC broadcast its evening news to a viewing audience of some 319,000 people throughout New South Wales and the Australian Capital Territory. 81 Being a newspaper article, the Nationwide publication was a more permanent record than a television broadcast. As such, it is not lost to circulation after the day of its issue and readers may return to the text to check its contents. "The Daily Telegraph's" circulation of 1,254,000 readers in New South Wales alone was vast. I accept that the less prominent positioning and headlining of the article relative to other articles in the newspaper and the fact that Mr Bates was not named in it, but described as the managing director of Vacik, limited its damaging impact on his reputation and standing. The last point is not very significant, however, because Mr Bates' role in the company was widely known. 82 Common to both publications is the fact that both were published principally in New South Wales, Mr Bates' home state and the state where Vacik carries out most of its operations. 83 Thirdly, it is relevant to consider the way in which the imputations may have damaged a person's reputation among the person's own social group or class in the community: Readers Digest Services v Lamb ; (1982) 150 CLR 500. Costello and Abbott v Random House Pty Limited . According to the Hon. Ian Armstrong, whose evidence I accept, a member of parliament would not deal with a person against whom allegations such as being a murderer had been made, until the matter had been cleared up in court. He said that in relation to contact with government, the allegations would be extraordinarily damaging. Since Mr Bates had regularly mixed in government circles and was held in high esteem, I find that his reputation was especially damaged among these members of his own circle. 84 It is difficult to provide evidence of actual damage to reputation. It is also not required. Once defamation is proved the law presumes damage: Wisdom v Brown ; (1885) 1 TLR 412. Readers Digest Services Pty Ltd v Lamb, Plato Films v Speidel ; (1961) AC 1090. Howlett and Anor v Saggers and Anor . However, evidence was given of actual damage to the plaintiffs' reputation and standing in this case, and I accept that evidence. 85 Mr Martin gave evidence that some of the people Mr Bates had mixed with socially for years, and who were his friends, thought there might be some truth in what had been published. Mr Bates, in the course of preparing the case and particularly in speaking to prospective witnesses, was shocked to find the extent to which others had discussed the publications and had been wondering if there was any truth in them. 86 I believe that there has been considerable, long lasting damage done to Mr Bates' reputation. Although I find that previous allegations of wrongdoing constituted mere unsubstantiated rumour that did not affect the high reputation of the plaintiffs, the damage was all the worse because the imputations enlivened old rumours, validating them, giving them authority. The plaintiffs were particularly vulnerable to such damage. It eventuated.

Injury to feelings 87 I have previously accepted that Mr Bates suffered hurt and distress as a result of the ABC and Nationwide publications. Lord Diplock said in Broome v Cassell and Co Ltd : [1972] AC 1027 at 1125. "The harm caused to the plaintiff by the publication of a libel upon him often lies more in his own feelings, what he thinks other people are thinking of him, than in any actual change made manifest in their attitude towards him. A solatium for injured feelings, however innocent the publication by the defendant may have been, forms a large element in the damages…even in cases in which there are no grounds for 'aggravated damages'…"

Damages for injury to feelings is not available to the corporate plaintiff: Comalco Ltd v ABC ; (1985) 64 ACTR 1. RSPCA v 2KY Broadcasters Pty Ltd . Unreported, 9 December 1988, Hunt J. This was explained by Lord Reid in Lewis v Daily Telegraph : [1964] AC 234 at [262]. "A company cannot be injured in its feelings, it can only be injured in its pocket. Its reputation can be injured by a libel but that injury must sound in money. The injury need not necessarily be confined to loss of income. Its goodwill may be injured." 88 A number of matters are relevant to injury to feelings. Mr Bates was particularly hurt by the ABC publication because it had shown his face, did not give him an opportunity to comment himself and it did not report that the allegations of corruption had been withdrawn. 89 Mr Bates regarded the accusation of being a murderer as the worst thing that could be said about anyone and that on this account he was much more upset about this imputation arising from "The Daily Telegraph" article than he had been as a result of the ABC news item. The meaning a plaintiff attributes to a publication will affect the hurt that the plaintiff feels. The plaintiff's own interpretation of the material is relevant to the issue of injury to feelings: Howlett and Anor v Saggers and Anor ; Hughes v Mirror Newspapers Ltd ; (1985) 3 NSWLR 504. Tingle and Anor v Harbour Radio Pty Ltd and Anor . (1999) Aust Torts Reports 81-510. I find that the imputation of murderer caused Mr Bates particular mental suffering because of his own reaction to its meaning and significance. 90 Mr Bates was also distressed because of imputations were contained in a publication which he regarded as a reputable. He said he regarded "The Daily Telegraph" as a highly reputable paper, and believed most things printed in it. He was concerned that the assertions made in the newspaper article carried the authority of the newspaper, and were likely to be believed. It is permissible to take into account the plaintiff's personal view of the defendant in assessing damages. In Tingle and Anor v Harbour Radio Pty Ltd and Anor , Kirby J recognised that the plaintiff was distressed because he had thought highly of the defendant as a friend. I find that Mr Bates' high regard for "The Daily Telegraph" contributed to his mental anguish. 91 The publications remain a source of hurt to Mr Bates. He has ruminated over them and has suffered a change of personality in their aftermath. The law recognises individual differences in the way in which, and the degree to which, imputations might affect a plaintiff and give rise to mental anguish: Howlett and Anor v Saggers and Anor . In Costello and Abbott v Random House Pty Limited Higgins J said that "[t]he grief or distress at being defamed will, no doubt, vary from person to person." at [299]. Mr Bates was a tough man and an experienced and successful businessman, but the value he placed on his well earned reputation - value to himself and value to his family - his self-confidence, pride and sense of family made him particularly vulnerable. 92 Moreover, Mr Bates' hurt has been aggravated by the fact that the imputations were false, and that no care was taken to verify the serious imputations that were made.

Vindication 93 Vindication concerns the way in which an award of damages is able to restore the regard in which a plaintiff is held by others. According to the majority of the High Court in Carson v John Fairfax & Sons Ltd : (1993) 178 CLR 44. "Vindication looks to the attitude of others to the appellant: the sum awarded must be at least the minimum necessary to signal to the public the vindication of the appellant's reputation." (at 61)

The amount awarded to the plaintiffs must be sufficient "to convince a bystander of the baselessness of the charge": per Lord Hailsham LC in Broome v Cassell & Co Ltd . (1972) AC 1027 at 1071. Once an appropriate sum has been settled on to compensate the plaintiffs for injury to reputation and for hurt to feelings, it is necessary to ask whether that sum vindicates the plaintiffs. If the amount provides vindication, then the three purposes of an award of damages in defamation will be satisfied by that award: Carson v John Fairfax & Sons Ltd . at 60-61. However, an adjustment of the award of damages may be necessary in order to ensure that the final award provides adequate vindication.

The Effect of Section 48 94 At common law a defendant cannot mitigate damages by tendering evidence of other defamatory publications about the plaintiff. This was explained by McHugh J in Carson v John Fairfax & Sons Ltd : at 99. "A defendant must answer for the effect of its own publications without regard to what others have published. If a defendant wishes to contend that the plaintiff's reputation was already damaged at the time of publication, it can do so by calling witnesses to prove the nature of the plaintiff's reputation at the time. They cannot tender other publications for that purpose. They may or may not have damaged the plaintiff's reputation."

This rule has been qualified by s 48 of the Defamation Act 1974 which provides that evidence is admissible in mitigation of damages if the plaintiff has already recovered, has brought proceedings for damages, or has received or has agreed to receive compensation "for defamation in respect of any other publication of matter to the same purport or effect as the matter complained of." 95 Particulars are required: Pt 67 r 18(2). More fundamentally, the burden of proof is on the defendants under this issue, and there is no evidence that the plaintiffs have recovered damages or are likely to do so from any source other than the present defendants for imputations to the same effect as the matters complained of the present proceedings. However, the section operates to prevent double damages for substantially the same imputation by the present defendants. This is so in relation to the imputations of illegal practice arising from the ABC publication and the imputations of corrupt activities arising from the Nationwide publication. 96 Leave should be given to rely on s48 to that extent notwithstanding the absence of particulars as required by the rules: Pt 1 r 2. I have regard to this consideration when assessing the damages to be awarded against the present defendants.

The effect of Section 46A 97 Section 46A provides that a judge must take into account certain factors as relevant to the assessment of damages: "(1) In determining the amount of damages to be awarded in any proceedings for defamation, the court is to ensure that there is an appropriate and rational relationship between the relevant harm and the amount of damages awarded. (2) In determining the amount of damages for non-economic loss to be awarded in any proceedings for defamation, the court is to take into consideration the general range of damages for non-economic loss in personal injury awards in the State (including awards made under, or in accordance with, any statute regulating the award of any such damages)." 98 Kirby J made the following observations concerning this section in Tingle at [132]: "The background to this legislation furnishes some insight into its meaning. In Coyne v Citizen Finance Ltd ((1990-1991) 172 CLR 211), Mason CJ and Deane J (who were in the minority), adopted the approach of Diplock LJ in McCarey v Associated Newspapers [No 2] ([1965] 2 QB 86), and said this, at 221: "… it seems to us that it would be quite wrong for an appellate court, entrusted with hearing appeals in both defamation and personal injury cases, to be indifferent to the need to ensure that there was a rational relationship between the scale of values applied in the two classes of case." In John Fairfax Limited v Carson (1991) 24 NSWLR 259, an award of damages in favour of a prominent solicitor, totalling $600,000, was set aside, by majority, as excessive. Kirby P, who with Priestley JA formed the majority, said this at 274: "It is also perhaps worth recalling that, more recently, this Court held that (by the standards of jury verdicts of this State) a jury verdict of $250,000 for general damages for effective total blindness caused by negligent hospital care, was outside 'current general ideas of fairness and moderation': see Canterbury Hospital v Cappelletto (Court of Appeal, 17 May 1991, unreported). In that case Mahoney JA and I both considered $250,000 was appealably excessive. In so far as one may compare that verdict to this, it seems difficult to say that the damage to Mr Carson was greater than to Mrs Cappelletto, in aggregate, and by a magnitude of 2.4…" On appeal, the High Court (Mason CJ, Deane, Dawson and Gaudron JJ) said this: (at 57/58): "In Coyne , Mason CJ and Deane J considered that it is legitimate for an appellate court considering an appeal against the quantum of damages in a defamation case to bear in mind 'the scale of values' applied in dealing with appeals in cases of serious physical injury ((1991) 172 CLR at 219-221). There is no occasion here to repeat the reasoning advanced in support of that conclusion. That conclusion does not deny that the harm suffered in defamation cases differs from the 'tearing of flesh and bone and the pain of body' ( Carson (1991) 24 NSWLR 273, per Kirby P) suffered in personal injury cases nor that ' precise comparisons' (ibid (emphasis added)) should not be drawn between the different types of cases. But for an appellate court which must test the quantum of a defamation award against some criteria to be prohibited from considering awards of general damages in personal injury cases would exclude reference to a potentially relevant criterion."

He continued: "There was a need for a rational relationship between the scale of values applied in the two classes of case.

The Court added: (at 58/59) "And the foundation of that relationship must be the scale of awards for general damages in cases of serious physical injuries which, in their severity and disabling consequences, transcend injury to reputation." 99 In Australian Consolidated Press Ltd v Ettingshausen (unreported, C of A, 13 October 1993), the appellant published a photograph of Mr Ettingshausen naked in a shower in a football dressing room. The plaintiff sued upon an imputation that he had deliberately permitted a photograph to be taken with his genitals shown, for publication in a magazine with a wide readership. There was a further imputation that he was unfit to engage in promotional work with young people. Mr Ettingshausen was awarded $350,000 by a jury. Kirby P, in this context, said this: (at 39) "The High Court, in Carson (at 591), specifically took into account two recent awards for general damages for quadriplegia, being $275,000 and $250,000 respectively. Using the same criteria, and approaching the matter in the same necessarily general way, I reach the identical conclusion in this case. It is simply impossible to suggest that compensation for the harm done to the reputation of Mr Ettingshausen required or permitted general damages greater in magnitude than those awarded to persons suffering profound quadriplegia."

The principle was restated by the High Court in Theophanous v Herald & Weekly Times Ltd & Anor ((1994) 124 ALR 1) at 20: "… an appellate court hearing appeals in both defamation and personal injury cases needs to ensure that there is an appropriate or rational relationship between the scale of awards in the two classes of case. That relationship stands on the foundation represented by the scale of awards for general damages in cases of serious physical injuries which, in their severity and disabling consequences, may transcend injury to reputation."

It was against this background that s 46A of the Defamation Act was introduced. The Second Reading Speech by the Attorney General included the following: "Honourable members need have no concern that the legislation now before the House will fetter the proper exercise of judicial discretion. On the contrary, the Bill envisages that such a discretion will be retained. All it requires is that, in assessing non-economic damages, the judge will take into consideration awards made in other types of cases. Such awards are an important factor, but they are by no means the only factor legitimately to exercise a judge's mind." 100 In Kirby J's view, "the alignment of defamation verdicts (for non economic loss) with those in personal injury cases is a reminder of the need for moderation": Tingle at [146]. I respectfully agree with that view. The amount of damages awarded in defamation matters must be neither excessive nor close-fisted when compared with the damages awarded in personal injury matters for distressing and permanently disabling injuries. It is, however, to be borne in mind that damages for defamation serve the dual purpose of compensation and vindication. Insofar as they serve the latter purpose, a relativity with awards in personal injury cases may not be practicable. 101 I have regard to subs (1) and (2) of s 46A. 102 In view of the considerations mentioned in this judgment, I assess damages as follows: (1) For Mr Bates against the ABC: $ 60,000 (2) For Vacik against the ABC: $ 15,000 (3) For Mr Bates against Nationwide: $150,000 (4) For Vacik against Nationwide: $ 25,000 103 The parties should bring in short minutes of order. I will hear any claim for interest pursuant to s 93 at that time. ********

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