Directors win defamation case over property sale lies

Directors of a community organisation successfully sued for defamation after being falsely accused of lying about a property sale offer. The court found the defendants liable for damages under the Defamation Act 1974.

New South Wales Supreme Court

CITATION : [NAME] & [NAME] v [COMPANY] & Anor [2003] NSWSC 1060 HEARING DATE(S) : 27 October 2003 JUDGMENT DATE : 18 November 2003 JURISDICTION: Common Law JUDGMENT OF : [NAME] J at 1 DECISION : JUDGMENT FOR PLAINTIFFS

CATCHWORDS : DEFAMATION - DAMAGES ASSESSED LEGISLATION CITED : Defamation Act 1974 [NAME] v [NAME] 1993 178 CLR 44 CASES CITED : [NAME] v [COMPANY] 1943 All ER 359 [NAME] v [COMPANY] 2003 77 ALJR 1739 [NAME] v [NAME] 1985 1 NSWLR 58 PARTIES : [NAME] and [NAME] v [COMPANY] and [NAME](S) : SC 20071/99 COUNSEL : [redacted] No appearance (Defendants) SOLICITORS : [redacted]

IN THE SUPREME COURT OF NEW SOUTH WALES [NAME] J

Tuesday 18 November 2003 20071/99 - [NAME] and [NAME] v [COMPANY] and [NAME]

JUDGMENT

1 HIS HONOUR: Eleven plaintiffs seek damages alleging that they have been libelled in an article published in the Greek Herald on 20 January 1999. The matter complained of was published in the Greek language and the evidence includes a relevant English translation. The litigation has a considerable history, both at first instance and appellate levels. It is unnecessary to trace this in detail now. A hearing on 5 February 2001 pursuant to s7A of the Defamation Act 1974 (the Act) resulted in determination by a jury that the matter complained of made an imputation in respect of each plaintiff that he lied to members of the Canterbury Marrickville [NAME] (the [NAME]) and that such imputation was defamatory of each of them. The plaintiffs were directors of the [NAME]. None of them was mentioned by name in the publication. 2 On 9 May 2003 a hearing date of 27 October 2003 was fixed. On 15 July 2003 a notice of ceasing to act as solicitor was filed by [NAME] who was to that time the solicitor on record acting for the defendants. Nevertheless, Mr [NAME] appeared for the defendants on 15 September 2003 when a notice of motion filed by the plaintiffs, seeking inter alia, orders that the defence be struck out was, by consent, dismissed. On that occasion the presiding judge (Nicholas J) gave certain directions and also gave leave to each of the plaintiffs, "should he be so advised, to file written statements in lieu of or in addition to, each giving evidence at the forthcoming trial." 3 Upon the action being listed for hearing as scheduled on 27 October there was no appearance on behalf of either defendant. The relevant pleadings, following the trial pursuant to s7A abovementioned, are identified as the Second Further Amended Statement of Claim following that hearing and pursuant to order of 5 February 2001 and the Further Amended Defence filed on 29 January 2003. 4 The pleadings by the defendants raised these specific defences:

(i) Qualified privilege (at common law and pursuant to s22 of the Act); (ii) Justification; (iii) Contextual truth; (iv) Comment (fair comment where relevant); and (v) Mitigation of damages. 5 Requisite particulars were supplied. The evidential onus of proof in respect of all of these defences rests upon the defendants. In the circumstances of their unexplained absence from the hearing, there was, of course, no evidence to support any of these defences and I therefore find that each of them fails. 6 Essentially the remaining issue concerns the damages of the individual plaintiffs. 7 All plaintiffs availed themselves of the leave granted by Nicholas J and their statements are comprised in Exhibits B1 to B11, supplemented by Exhibit C. Oral evidence was confined to testimony that at the relevant time the [NAME] consisted of three hundred and ninety members. 8 An answer to an interrogatory verified by the second defendant was tendered to establish circulation figures of the Greek Herald as approximately 24,000 in New South Wales, 600 in Victoria, 100 in Queensland, 20 in West Australia and 900 in South Australia. I mention that in unresponsive part answer to the particular interrogatory there was an assertion that neither of the defendants was a publisher of the Greek Herald at the relevant time. Publication by the defendants was not put in issue in the Further Amended Defence and I also observe that in particulars of qualified privilege at common law supplied in that defence, an introduction "The defendants as publishers of the Greek Herald" appears three times. (See par 3(b)(i), (ii) and (iii)). I find that the defendants were relevantly the publishers. 9 The matter complained of refers to a proposed sale of the [NAME] property for $2.2 million and an asserted offer by the second defendant and a named businessman of $2.4 million. The plaintiffs, directors of the [NAME], are said to have deceived the members about the existence of this alleged offer. The sting in the imputation is readily discernible in the translation hereunder set out. The paragraphing is that of the translator and the first paragraph is a pointer, obviously appearing on a different page from the text of the principal article: "1. Our [NAME] reveals Why did they hide from the members of Marrickville Olympic a bigger offer for the purchase of their land? SEE ARTICLE ON PAGE 54

2. S C A N D A L

3. Why did they hide from the members of Marrickville Olympic a better offer for their land? 4. The properties of our clubs are considered properties of our community, for which the members and the directors of our community organisations decide, however, these do not cease to be in essence properties of us all.

5. Having this in mind, one is enraged even more when one realizes that the property of a community organisation, such as the Canterbury Marrickville Olympic is sold at a price which is by $200,000 lowever (sic) than that at which it could have been sold. Simply in order that certain people could earn money, openly but also secretly.

6. Without going around and without saying too much, following what I have been informed and confirmed on my return from a trip to Greece, the Canterbury Marrickville Olympic Committee, after two general meetings and unsuccessful attempts, convened a third general meeting and managed to convince the members to approve the sale of their land to the neighbouring [NAME], at the sale price of $2,200,000. The members' approval was given following general meetings upon general meetings for the same issue and after the directors assured the members that THERE WAS NO OTHER offer for the land of their [NAME].

7. This is exactly where the lie is, that is the concealment of the truth and the obvious existence of personal interests, which would be served with the sale of the land to the Masonic Hall and above all with the purchase of a particular other land. Which, in turn may blow up and lead to bankruptcy our only financially robust, at this point, soccer [NAME], but in the meantime, those who are to benefit will benefit! 8. The truth, which the members were not told about and which the directors and the president of Canterbury Marrickville Olympic knew personally, was that there was another offer for the [NAME] land, bigger by $200,000 than the offer of the [NAME] or any other offer.

9. The said offer was made by me personally an by the well-known businessman of our community [NAME] but for reasons which the directors of Canterbury Marrickville Olympic will need to explain to us, the members were not advised of its existence.

10. Why? 11. Is it because the granting of the exclusivity of sale of the land to the real estate agency of [NAME] was about to expire and so it would not receive the commission for the sale, unless the buyer was the [NAME]? Or are there any other benefits from the [NAME] to anyone who would secure for it the land, which is situated exactly next door to it.

12. Finally, how much more can a real estate agency expect to benefit from a big and risky, for Canterbury Marrickville Olympic, purchase of a building, whose price could reach as we hear, the sum of $5,000,000 and which is, of course, beyond the capabilities of the soccer [NAME]? 13. All the above are thoughts based on indications and especially on the fact of hiding our offer from the members of Canterbury Marrickville Olympic, which the president and the directors did not have the right to do. Especially, when they were asked in the course of the last general meeting 'if there was any offer other than that of the [NAME]'? 14. Perhaps the president and certain members of the Committee are our friends in other ways but this will not prevent us from denouncing the actions which may benefit certain pockets but undoubtedly harm the [NAME], to the property of which we have ALL contributed through the years and for which we have all co-operated, some in small ways and others in bigger ways, in order to be maintained.

15. It should be noted that apart from the moral obligation, the president and the directors of Canterbury Marrickville Olympic may also have legal responsibilities for the fact that they hid from the members a more advantageous offer for the sale of the [NAME]'s property, which was made very seriously and not by just anyone but by known businessmen with financial power more than enough for its purchase.

16. As an editor of newspapers which reflect the public opinion of our community and also as a businessman, personally and with [NAME], we will investigate the matter in depth and will inform on what we discover. Because, neither on our part nor on the part of the majority of the [NAME] is there any intention of covering up a scandal which decreases the property of our soccer [NAME] and exposes it to deadly dangers for the sake of the interests of a real estate agency and of the agent's circle of friends.

17. As for the resulting deficit(s) of $200,000 in the coffers of Canterbury, this should be made up by those who covered up the offer of $2,400,000 so that the land could be sold where they prefer at $2,200,000 less commission.

[NAME] " 10 It will be necessary to consider damages payable to the individual plaintiffs but there are some general aspects of assessment which can be mentioned. Damages are limited to those relating to relevant harm as defined: see s46. There is a form of statutory guidance: s46A. The evidence shows that the imputation is false: see s47. 11 The purposes of an award of damages for defamation have been described as three, undoubtedly overlapping, purposes namely consolation for the personal hurt to the plaintiff, reparation for harm done to reputation and vindication of that reputation: [NAME] v [NAME] 1993 178 CLR 44. Within the limitations imposed by s46, aggravated compensatory damages may be available to a plaintiff. They are awarded where either the circumstances of the publication of the matter complained of or the defendant's conduct then or subsequently makes the injury to the plaintiff worse: [NAME] v [NAME] 1985 1 NSWLR 58. 12 It will be observed as I deal with the individual assessments of damage that there is considerable similarity in a number of the claims and this is unsurprising in the circumstances of the commonality of their directorship of the [NAME] and their membership of the Greek community in Australia. To avoid repetition I record that in general I accept the unchallenged evidence in each of the plaintiffs' statements, (Exhibit B1 to Exhibit B11). 13 All of the plaintiffs gave descriptions in a variety of language of their feelings of personal hurt and I accept what they say. I further accept that there exists in each case relevant matters of aggravation. As I make the individual assessments it will be unnecessary to recite in detail the descriptions of personal hurt but it is clear that in every case there has been a significant and continuing personal harm. 14 Recent discussions concerning the damages for defamation in the High Court ([NAME] v [COMPANY] 2003 77 ALJR 1739) can be drawn upon for guidance. As was there observed, damage to reputation is not a commodity having a market value and every such award must be unique. Comparison between awards is particularly difficult. In this case, what the defendants published is recorded in a newspaper of significant circulation in the Greek speaking, or more accurately Greek reading, community. As Callinan J remarked in [NAME] (par 134) such may serve for some as "at least a rough draft of the truth for historical purposes". 15 In the case of each of the plaintiffs the falsity of the imputation and the failure to apologize will be taken into account in assessing aggravated damages.

[NAME] 16 At relevant times, Mr [NAME] was President of the [NAME] as well as being a director. He is a businessman who had admiration and respect, particularly within the Greek community. 17 As with many others, he has experienced being shunned by a number of people. This is of significance in assessing the measure of damage done: [NAME] v [COMPANY] 1943 All ER 359. There is a matter which affects only this particular plaintiff, and that is that the defendants by their pleading made an allegation of bad reputation in terms that he "was accused of electoral fraud in relation to the elections of (the [NAME]) in 1994". This pleading was filed on 1 February 2001 and was not withdrawn until 29 January 2003, and its existence during that span should be taken into account, as I do, as a matter of impact upon the plaintiff in assessing his damages. 18 I assess his damages at $80,000.

[NAME] 19 Mr [NAME] has been a member of the [NAME] for twenty years and a director for ten years. He has experienced shunning and accusation. His family and social life have been affected and he and his wife have ceased attending some functions. 20 I assess his damages at $60,000.

[NAME] 21 [NAME] joined the [NAME] in 1974. He was elected to executive office as Treasurer in 1995. His position as such was well known in the Greek community. He received offensive calls and suggestions that he should resign. 22 I interpolate that, although I have said that I generally accept the material in the statements including this plaintiff's statement, I should specifically record that I am not satisfied that any interference with the brakes of his wife's car had any connection with the defendant's tort. The context of the imputation was, of course, related to money in the sense of circumstances surrounding the intended sale of the [NAME]'s asset. The position of Mr [NAME] as the Treasurer assumes particular significance. 23 I assess his damages at $65,000.

[NAME] 24 [NAME] has been a member of the [NAME] since 1981 and served two terms of office as a director for a total of ten years. 25 He is a real estate agent and in fact the [NAME] property had been listed through his employer. He knew that no offer by the defendant [NAME] or any associate of his had been made, at least through the agency. 26 The plaintiff has experienced insults and shunning. His statement refers to the loss of a client but the terms of it do not elaborate any claim for actual economic loss. 27 I assess his damages at $60,000.

[NAME] 28 [NAME] has been a member of the [NAME] for thirty six years and a director for twelve years. 29 He and his wife have been excluded from a group with whom he had previously enjoyed warm social relations. He has received insults and on one occasion was spat upon. 30 I assess his damages at $60,000.

[NAME] 31 [NAME] has been a member and director of the [NAME] since 1996. 32 He has been the subject of insults and abuse. He was particularly exposed to such as he was the ticket collector at football games. He has candidly observed that since the jury verdict this abuse has subsided but "every now and then he is called a liar and a thief". 33 There has been an effect upon the comfort of himself and his wife when they attend social functions within the Greek community. 34 I assess his damages at $60,000.

[NAME] 35 [NAME] has been a member of the [NAME] since 1997. 36 He received anonymous calls asserting that he had robbed the [NAME]. He treated enquiries as implying doubt about his integrity and was particularly hurt when even his children enquired as to what was going on. 37 He had a takeaway food shop business, which he subsequently sold. He had noted some drop in business at the shop. He didn't work for two years and commenced operating a contract cleaning business. 38 Invitations to functions have noticeably lessened and he has ceased some social activity. 39 I assess his damages at $60,000.

[NAME] 40 [NAME] saw the matter complained of on the day of publication and was especially upset to return home to query from his own family as to what he had been doing. I do not have precise details of the length of his [NAME] membership or service as a director. 41 He received calls particularly in the week following publication in which he was called a liar and thief. He has been queried in person when attending such places as a garage, shop and soccer games. He has reduced his previously enjoyed frequent attendance at soccer games because of this. 42 I assess his damages at $50,000.

[NAME] 43 [NAME] has been a member of the [NAME] for ten years and a director since 1997. 44 He saw the article on the date of publication. He worked at the time with ten people of Greek extraction. They read the article and he was ridiculed and called a liar. It was expressly suggested that he had joined the board of the [NAME] to steal its money. The taunts continued and some eighteen months later he sought and obtained other employment. 45 On his return home on the day of publication he was particularly upset to be asked by his wife (who had separately purchased the paper and read the article) for an explanation. She suggested his resignation because she was worried about "what people would say". 46 Apart from harassment at work he received abusive phone calls. He was subjected to public abuse. On one occasion a member of a crowd at the Olympic games in Stadium Australia yelled out "you are a thief" as he went to his seat. 47 He has experienced shunning to a marked degree. 48 I assess his damages at $70,000.

[NAME] 49 [NAME] read the article on the day of publication. Thereafter he noticed that family and friends "acted differently towards me". I do not have detail of the length of his [NAME] membership or service as a director. 50 He has been particularly distressed by a feeling that even his family are questioning of him. He sought medical attention for "aggravation to my nerves". 51 I assess his damages at $50,000.

[NAME] 52 [NAME] has been a member and director of the [NAME] for six years. He is the "convenor" of juniors for the [NAME]. As such he dealt with over one hundred children and their parents. After the publication he was subjected to abuse and insults from parents and children alike. 53 He received anonymous phone calls after the publication including some which he took to be death threats. He has had a long association with soccer organizations wider than his activity within the [NAME] but the result has been that he has been exposed to even more questioning and insults from these wider sources 54 He has suffered socially and noted a significant decline in invitations received. He is being treated for stress and ulcers, conditions from which he did not suffer prior to the publication. 55 I assess his damages at $70,000.

SUMMARY 56 The total damages payable by the defendants is $685,000. 57 I direct entry of judgment for the respective plaintiffs as follows: (i) Judgment for [NAME] $80,000 (ii) Judgment for [NAME] $60,000 (iii) Judgment for [NAME] $65,000 (iv) Judgment for [NAME] $60,000 (v) Judgment for [NAME] $60,000 (vi) Judgment for [NAME] $60,000 (vii) Judgment for [NAME] $60,000 (viii) Judgment for [NAME] $50,000 (ix) Judgment for [NAME] $70,000 (x) Judgment for [NAME] $50,000 (xi) Judgment for [NAME] $70,000

58 The defendants are ordered to pay the plaintiffs' costs of action. **********

Last Modified: 11/19/2003 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.