King v Fairfax Media Publications Pty Ltd (No 4)

HER HONOUR: These proceedings are before the Court for the second listing: SC CL4. Happily, the parties have reached agreement as to most of the issues concerning further interlocutory steps (as, in my experience, is commonly the case with the particular counsel at the bar table; that is a matter for which I am always grateful).

Three arguments were brought forward for the Court's determination. The first related to category for discovery 20 and interrogatories 23 to 25, all relating to the content of a handwritten note which is the primary focus of the first matter complained of.

The matter complained of, in the body of the article, refers to a handwritten memorandum made by then acting CEO of Leighton, David Stewart, and continues:

The article proceeds to quote from the handwritten memorandum. A transcript of the memorandum is set out in a pictorial way on the right-hand side of the matter complained of under the headline "Uncovered - transcript of memo handwritten by David Stewart."

The plaintiff has pleaded a number of imputations arising from those allegations. The defendants have not pleaded a defence of truth to any of those imputations; the only truth defence is to two unrelated imputations. Nonetheless, the defendants contend that discovery and interrogatories directed to the handwritten note are appropriately ordered on the strength of the fact that the plaintiff relies on the falsity of the imputations as a particular of aggravated damages. Category for discovery 20 seeks any copy of the note held by the plaintiff, while interrogatories 23 to 25 are directed to those issues.

Mr Richardson, who appears for the plaintiff, submitted that in the new era governed by practice note SC CL 4, the Court would not permit such interlocutory steps. He reminded me of my discussion in my recent judgment in Brooks v Fairfax Media Publications Pty Ltd (No 2) [2015] NSWSC 1331 of the broad proposition that, as argued by Ms Chrysanthou in that case, the defendant must "publish and be dammed" and cannot seek, by interlocutory steps in defamation proceedings subsequently commenced, to strap up the strength of the material available to the journalist at the time of publication. That is a broad gloss on the principles discussed in that decision but it is pertinent to the point made this morning.

I am not persuaded that category for discovery 20 or the interrogatories identified are necessary for the resolution of the real issues in the proceedings, having regard to the principles stated in ss 56 to 60 of the Civil Procedure Act 2005 (NSW) intended to be reinforced by the practice note. Those steps will not be allowed.

The next issue relates to interrogatories 36(a) and (b) which relate to the negotiations between the plaintiff and Leighton for a consultancy agreement. The plaintiff has pleaded an imputation that “during his tenure as CEO of Leighton[ he] encouraged a culture of rewarding corruption and incompetence and abysmal corporate governance”.

In support of a plea of truth to that imputation, the defendants rely upon a consultancy agreement which it is alleged entitled a company associated with the plaintiff to receive monthly consultancies fees over three years in the total some of six million dollars, where the consulting agreement did not require the plaintiff or the company to actually perform any services. The defendants contend that the consultancy agreement had the effect of circumventing the requirements for shareholder approval of executive retirement benefits contained in ss 200B and 200D of the Corporations Act 2001 (Cth).

In my view, those interrogatories are appropriately directed to the proof of that contention and are necessary for the reason that without the plaintiff's answer to those questions the defendants would only be in a position to prove those contentions by more difficult or expensive means. I propose to allow those interrogatories.

Finally, interrogatory 47 is directed to whether, in substance, the plaintiff has made comments to the media which it was contended would be relevant to the question of hurt to feelings. The proposition appeared to be that if the plaintiff has discussed the matters complained of or these proceedings in other forums that might undermine his credibility if he gives evidence in the witness box as to having been hurt by the matters complained of. I do not think that interrogatory passes the test of necessity and accordingly would not allow that interrogatory.

The rulings accordingly are that category 4 discovery be disallowed, that proposed interrogatories 23 to 25 be disallowed, that proposed interrogatories 36(a) and (b) be allowed and that proposed interrogatory 47 be disallowed.