Essey & Anor v Harding & Anor [2005] HCATrans 889 (26 October 2005)

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Essey & Anor v Harding & Anor [2005] HCATrans 889 (26 October 2005)

Last Updated: 4 November 2005

[2005] HCATrans 889

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Perth No P12 of 2005

B e t w e e n -

FRED JOSEPH ESSEY

First Applicant

ALL-FECT DISTRIBUTORS LTD

Second Applicant

and

MARLENE ANNE HARDING

First Respondent

PINEGATE HOLDINGS PTY LTD

Second Respondent

Application for special leave to appeal

GUMMOW J
KIRBY J

TRANSCRIPT OF PROCEEDINGS

AT PERTH ON WEDNESDAY, 26 OCTOBER 2005, AT 10.12 AM

Copyright in the High Court of Australia

MR J.F. HASSETT: May it please the Court, I appear for the applicants. (instructed by Hassett Dixon)

MR J.T. SCHOOMBEE: May it please the Court, I appear for the respondents. (instructed by Phillips Fox)

GUMMOW J: Yes, Mr Hassett.

MR HASSETT: Your Honours, I would like to draw the Court’s attention firstly to the position of Mr Stace in these proceedings. He was a witness called under subpoena by the plaintiffs and he said in effect that he did not know from where he received the publication complained of. To be precise, the question asked of him was, “What were the circumstances that you saw this article?”, and he said, “I think one of the wholesalers showed it to me and I don’t know where he got it from. Yes, the best I can recollect was that it was shown this was out in the marketplace”. In other words, any of the 180 canteen manageresses could have given the subwholesaler the - - -

GUMMOW J: This is all very interesting but it does not sound like a special leave point.

MR HASSETT: The point is that - - -

GUMMOW J: What is the special leave point?

MR HASSETT: The point is we were never in a position to plead a republication. The principles in Speight v Gosnay which are well known, liability for republication rests with a defendant where it can be shown that it was either intended to be received by the publishee or whether it was a natural and probable consequence or whether it was an authorised republication. The special leave point is by insisting upon us making a pleading that we could not make, we were denied the opportunity to enliven the principles of Speight v Gosnay, all of which, I am suggesting to your Honours, were satisfied in this case. It was the natural and probable - - -

GUMMOW J: Where is the special leave point?

MR HASSETT: The special leave point is that if this decision is allowed to stand, then the consequence of that is that it is open to defendants to draw a narrow circle around the publication and insist on pleadings which a plaintiff cannot make and thus deny the plaintiff its rights under Speight v Gosnay. That is the first special leave point.

The plaintiff ought not be required to try to track a scandal – and there are centuries of defamation law in this respect – which it cannot track. In the instant case, for example, it could never have tracked the movements of this offending publication from the 180 canteen manageresses to the various other persons. That is the first point which I am suggesting your Honours ought not leave undisturbed because, if left undisturbed - - -

GUMMOW J: What is the particular error in the decision of the Full Court?

MR HASSETT: The error is that the Full Court held that because Justice Hasluck had ruled at the pretrial hearing that no republication was admitted, we were therefore stuck with that ruling and were not in a position to appeal it, thus they dismissed the notice of contention concerning this issue. Your Honour Justice Kirby sat in the case of Gerlach v Clifton Bricks, for example. It is well established that a plaintiff can take issue with an interlocutory ruling at appellate level, but the Full Court did not allow us to do that. It simply dismissed the notice of contention in this particular point I am making.

KIRBY J: I must accept, I think I was in dissent with Justice Callinan in Gerlach, was I not? But the principle is clear and the Full Court, if they thought you cannot raise interlocutory points which have been properly reserved in a final appeal, are wrong.

MR HASSETT: Correct.

KIRBY J: It is clear law. It has been law since the Privy Council in the 19^th century, but where does it lead in this case?

MR HASSETT: Where it leads in this case is that the Full Court did not consider the point that I have just raised of republication in the pleading point. It simply said, “We’re not going to look at your notice of contention because you didn’t appeal it straight away”, which was clearly an error.

GUMMOW J: Where do they say that?

MR HASSETT: Justice Pullin says very simply - - -

KIRBY J: The whole point of reserving interlocutory issues and bringing them up in the final appeal is to conserve the time of appellate courts.

MR HASSETT: Precisely correct.

KIRBY J: But you have to find where they said that and then you have to show why we should get involved in this rather minor dispute between the parties.

GUMMOW J: What is the amount of damages at stake here?

MR HASSETT: The amount of damages is – there is $40,000 and $60,000 floating.

GUMMOW J: That must have been radically overtaken by costs long since.

MR HASSETT: Radically overtaken by costs, yes, but there is certainly a quarter of a million dollars at stake at this point.

KIRBY J: We do not normally get involved to help people sort out their costs of their litigation.

MR HASSETT: No, I appreciate that but nevertheless - - -

KIRBY J: I realise the case is important to the parties and I realise there would be a lot of feeling and so on about the case and I do think the Court of Appeal made a mistake in respect of the reservation of points for appellate consideration, but I am not convinced that that leads to reasonable prospects of success in the appeal if special leave were granted. So try to persuade me out of that view. First of all, would you answer Justice Gummow’s question and put your finger on where - - -

MR HASSETT: At page 116 of the application book at paragraph 136, line 25, Justice Pullin, with whom the others agreed, says:

In my opinion the notice of contention must be dismissed. If the respondents wished to challenge the two pre-trial rulings, it would have been necessary to seek leave to appeal against those decisions.

GUMMOW J: Yes, seek leave now to appeal. That is what is being said.

MR HASSETT: No, prior to the trial.

No such application was made to this Court. The rulings must stand.

Remembering these applications were made days before the trial and in those days before the trial there were a multiplicity of issues on hand. There was the question of the experts and the facts and the question of malice, dozens of questions of which this was only one. It was a contingent point in that, unless the – it depended on the publication findings as to whether the publication to Fraser was a publication or a republication.

KIRBY J: I thought there was another point where the Court of Appeal effectively said if you wanted to appeal, you had to do it at once. Is that the best - - -

MR HASSETT: Yes, that is what I am talking about.

KIRBY J: But is that the best passage you can point to? That is subject to, as Justice Gummow has pointed out, an alternative interpretation that his Honour was meaning you have to seek leave now.

GUMMOW J: You cannot, I think, convert the necessity for leave in respect of an interlocutory ruling to an appeal as of right simply by tacking it onto a substantive appeal at a later stage.

MR HASSETT: The notice of contention was on foot. The point was - - -

GUMMOW J: Otherwise, why have an interlocutory appeal if you could always get an appeal as of right at a later stage?

MR HASSETT: For the reasons that I mentioned in the Gerlach Case, it was not open to us to appeal in my view for the fragmentation of costs of proceedings to appeal - - -

KIRBY J: You would have been pushing a barrow uphill. Courts do not like interlocutory appeals.

MR HASSETT: No.

GUMMOW J: That is right, but why then do you get an appeal as of right at a later stage on this interlocutory question? The court may well say, “We’re not going to grant you leave because, as it’s all washed out, it didn’t matter”.

MR HASSETT: But it did.

GUMMOW J: I know that.

MR HASSETT: It became the vital point; it became the key point.

GUMMOW J: I realise that. I am trying to get you to grapple with the point of principle.

MR HASSETT: Yes, I see the point of principle and I cannot take it any further. As I understood the reasoning of the Court of Appeal, they were suggesting we should have taken action immediately, which we did not take.

GUMMOW J: They were suggesting a notice of contention per se was not enough.

MR HASSETT: I hear your Honour on that point. Perhaps that takes me to the position of Mr Fraser.

GUMMOW J: One would not necessarily attribute to these judges ignorance of the principles Justice Kirby and I have been talking to you about.

MR HASSETT: No, I appreciate that, but they appear to be suggesting we should take an action, whereas there was certainly no discussion to the appeal about - - -

GUMMOW J: I think you had better use your time.

MR HASSETT: Thank you, your Honour. The question of the publication to Mr Fraser: was it a publication or a republication? This now becomes the vital question. The point that I am making and what the trial judge found was that where there is an intention on the part of the publisher – let us say publisher A – that C in fact received the document, that is an original publication, not a republication via B. That was the trial judge’s finding, which was not open to attack by the Court of Appeal. The trial judge found that the defendants intended the publication to reach visitors to the canteens. It was therefore an original publication and not a republication.

Their Honours were in error on that point and the case turned on that point. When that point is considered with the other points that I have made concerning publication and republication, the special leave point which I am putting to your Honours is that this publication/republication point, which has hitherto been certainly debated in legal circles, in Assaf v Skalkos and other cases in the past where the opposing positions which I have put before the Court have been ventilated, but there has been no definitive finding on it and it becomes, in circumstances like this, of vital importance to the plaintiffs in my case and to plaintiffs generally.

Once you start requiring pleadings of republication that cannot be made and you deem republications to be where it is passed on, for example, from canteen manageresses to Fraser, which was the case here, then the plaintiff is unable to make out its case on these technical reasons which – I am suggesting the trial judge was correct. The vital question is one of intention, not of chronology. That is my point concerning publication and republication.

In connection with qualified privilege, your Honours have no doubt appreciated that this publication was issued with malice in a desire to damage a competitor. When my clients received the publication, the extent of it was totally unknown. All we had to go on was the form of the publication, which appears at the back of the application book, with its State-wide edition and the banner and so forth modelled on The West Australian newspaper.

KIRBY J: Can I ask was the letter your client sent, which I read carefully, sent after legal advice? It had a bit of a look about it that it might have been, but it was not?

MR HASSETT: No, your Honour.

KIRBY J: It is not really all that intemperate a letter.

MR HASSETT: Certainly not.

KIRBY J: Would you just explain to me – the Full Court accepted in part Justice Hasluck’s view and disturbed it in another part. What was the other part that they disturbed of Justice Hasluck’s rulings at trial?

MR HASSETT: I am not sure I am following “the other part”.

KIRBY J: I am referring to his Honour’s view that you cannot trace the poison, that you cannot follow the poison exactly. It is unreasonable to expect that of a party.

MR HASSETT: I think where the majority were coming from was that they said that my clients should have done more by way of researching the question of to whom the offending publication had been made. In doing so they - - -

KIRBY J: There is a battle of facts between you there, is there not? The respondent says you did not really pursue the acquisition of the knowledge of who we had actually sent it out to. You say that you did ask for it and you were not given it. The High Court of Australia is not going to get involved in that.

MR HASSETT: I beg your pardon?

KIRBY J: We are not going to get involved in resolving that sort of factual matter.

MR HASSETT: No, but the principle involved in terms of qualified privilege to an attack, which the High Court ought properly to get involved, in my submission, is the majority, in formulating what they say the reasonable man should have done, have taken into account, for example, facts which only came out subsequently. For example, they say we could have written the letter and undertaken to keep the publication as confidential. That was something that came out in the course of interrogatories.

In other words, my point to your Honours is that the majority took into account, in deciding what was reasonable, facts not known to my client at the time and could not possibly be known. They said the reasonable response was to do the things they said, for example, having been rebuffed once in a defiant and unco-operative manner, having been on the receiving end of the defendants in the case saying, “We stand by the truth”, which was surely a terminatory-type comment. The majority have nevertheless cast upon us a further onus to go back and they have used the knowledge which they had gained from the full course of the trial, including the interrogatories and what came out from that, including the fact that confidentiality undertakings were sought and given and so forth, and they have used all that knowledge and taken it back in time to the week or so that my client had to respond to the attack made upon him, and formulated their test based on those facts which were obviously unknown to my client.

I am talking specifically – if I may refer your Honours to Justice Steytler’s comment at page 85 of the application book where, at about line 23, he says:

Of course, the possibility exists that the inquiry would have been met with more defiance, and a refusal to answer it, but the evidence did not establish that a response of that kind would have been forthcoming, more particularly (as McLure J has pointed out) if the appellants were told what would be the consequence of a refusal and if the information provided was to be kept confidential to the respondents’ solicitors.

These were all facts that came out later. There is no way my client could have known any of that at the time. So a test has been applied incorporating hindsight and put forward as an objective test but in reality gave my client no opportunity to respond to the attack made upon him. They are my submissions.

GUMMOW J: Thank you.

KIRBY J: Dr Schoombee, could I just ask you – it would be a rather worrying thing if the Court of Appeal or Full Court here thought that you have to make application immediately against interlocutory points, because that is not the law and has not for 120 years been the law. Was Justice Gummow’s interpretation correct?

MR SCHOOMBEE: That is certainly my understanding of what occurred.

KIRBY J: Will you take me to the passage. That would be something we would have to correct if that were a misunderstanding in the Court of Appeal.

MR SCHOOMBEE: My understanding was that the actual ruling of the court is expressed in a passage that your Honours have been taken to at page 116. Can I just say in conjunction with this, one should also of course see the curious way in which the notice of contention was relied upon. Only Mr Essey needed a notice of contention in the appeal because his company won. We did not succeed against them.

The notice of contention essentially said that the judge had been wrong not to admit evidence of republication. Therefore, the evidence that went on other grounds per definition, not republication, should stand and that should afford us an argument to argue for republication. It was also in that context, as set out in the very next passage by his Honour Justice Pullin for the Full Court, in which the notice of contention was held to be simply untenable, because we have never faced a case involving republication.

Also just quickly on the factual issue, we could not plead republication. We are saddled with an impossible task. With the greatest respect, when the interlocutory skirmishes broke out before the trial, ten days and four days before the trial - - -

GUMMOW J: How many days was the trial again? Four, was it?

MR SCHOOMBEE: It was at least a week, I think, and we reconvened for argument for a day. We did not kick off, may I say. We were the defendants originally but did counterclaim. In that context, with the greatest respect, the notice of contention was simply untenable because it was seeking to introduce republication evidence. Just on.....of pleading point quickly, before - - -

GUMMOW J: I think we understand the point, Dr Schoombee. We do not need to hear you any further.

MR SCHOOMBEE: Thank you. My respectful submission would be that, as I have said in my submission, this is not a suitable vehicle. It appears to raise factual matters.

GUMMOW J: Yes, we understand that.

MR SCHOOMBEE: Perhaps I can just make one point, if I may, on the question of the approach to what Mr Essey had done and not done in writing his letter of retort.

GUMMOW J: No, we do not need to hear you any further. Yes, Mr Hassett, anything in reply?

MR HASSETT: Nothing in reply.

GUMMOW J: We are not convinced that the issues which the applicants wish to agitate in this Court present clear questions of law that require the intervention of this Court. Nor do we consider that the applicants would enjoy reasonable prospects of success in disturbing the actual orders of the Full Court were special leave to be granted. Specifically, we did not read the reasons of Justice Pullin in the Full Court as making the rudimentary error of suggesting that if interlocutory rulings are not appealed forthwith, they are lost and cannot be raised in an appeal against the final judgment at trial. We do not believe that the Full Court made such an error.

Special leave is refused with costs.

We will adjourn to reconstitute.

AT 10.34 AM THE MATTER WAS CONCLUDED