1st Available v Melocco

1. [1]

   HIDDEN J: These are proceedings for contempt brought by the plaintiffs, 1st Available Ltd and Klaus Bartosch, against the defendant, Kathryn Ann Melocco. Ms Melocco is alleged to have been in breach of certain undertakings she gave relating to proceedings between the parties commenced in 2013.

2. [2]

   Mr Bartosch is the managing director of the first plaintiff, 1st Available. The business of that company is the provision of online health care appointment bookings. Ms Melocco is a former employee of the company, and had also been a consultant for some months under a contractual arrangement. Put shortly, in the proceedings instituted in 2013 the plaintiffs claimed that Ms Melocco had published statements which were highly critical of them and were injurious to the pursuit of the company’s business, and sought declaratory and injunctive relief. These publications were partly on her website and partly by way of emails to various people.

3. [3]

   One of the recipients of emails was Mr Kim Jacobs, a director of a company called Inteq. That is a company providing corporate advice which was retained by 1st Available to raise capital and to provide advice in relation to shareholder engagement and other aspects of its business. Inteq had a substantial clientele of its own, and 1st Available hoped to benefit through access to those individuals as potential investors. Accordingly, the plaintiffs were concerned that 1st Available was seen as an enterprise of good repute.

4. [4]

   The proceedings were commenced by statement of claim in September 2013. Again put shortly, the plaintiffs’ claims were amplified by an amended statement of claim of November 2013 and a further amended statement of claim of May 2014. In February 2014, Ms Melocco sent a number of emails, again to various people including Mr Jacobs, which the plaintiffs claim conveyed some 35 false representations about them. These were specified in a letter from the plaintiffs’ solicitors to Ms Melocco of 26 February 2014, and some of them are the foundation of the present contempt proceedings. The letter sought Ms Melocco’s written agreement that she would undertake to the Court to make no further representations to the effect of them or similar to them. If he did not do so, the letter said, the plaintiffs would approach the Court for appropriate orders.

5. [5]

   Correspondence between the solicitors for the parties ensued and agreement was reached. On 17 March 2014, there was forwarded to the principal registrar certain consent orders for the conduct of the proceedings, in which was noted an undertaking to the Court by Ms Melocco to the effect of that sought by the plaintiffs. The undertaking was expressed to relate to the 35 representations complained of, which were attached as a schedule to the consent orders.

6. [6]

   The conduct giving rise to the contempt proceedings occurred on 3 April 2014. Subsequently, in October 2014, the 2013 proceedings were settled by a deed entered into by the parties and consent orders filed in the registry, whereby the proceedings were dismissed. To this development I shall return.

The contempt proceedings

1. [7]

   On 3 April 2014, Ms Melocco sent an email to Mr Jacobs to which was attached a volume of documentation. This material relates to a complaint she had made to the Australian Human Rights Commission concerning her treatment by the plaintiffs, that is, by 1st Available and, in particular, by Mr Bartosch. The complaint made allegations about the course of her employment and the circumstances surrounding its termination. The complaint alleged unlawful discrimination under the Disability Discrimination Act 1992 (Cth) and, pursuant to a relevant provision of that Act, the Commission terminated the complaint on the basis that there was no reasonable prospect of the matter being settled by conciliation.

2. [8]

   The material communicated to Mr Jacobs is reproduced in an exhibit to an affidavit of the plaintiffs’ solicitor, Mr Alistair McKeough, of 15 April 2014: exhibit “AGM-2” at pp 287-334. The email is at pp 287-289. The Human Rights Commission’s notice of termination of the complaint is at p 294. Annexed to that notice as attachment A are the Commission’s reasons for its decision: pp 295-6, and as attachment B Ms Melocco’s complaint: p 297ff. The narration of Ms Melocco’s complaint is at pp 297-304, and she attached a number of documents to it, reproduced at pp 305-334. For present purposes it is the email (pp 287-289) and the narrative complaint (pp 297-304) which are relevant.

3. [9]

   It is the plaintiffs’ case that by this communication Ms Melocco was in breach of her undertaking to the Court in respect of 9 of the 35 representations to which I have referred. By a notice of motion of 17 April 2014, the plaintiffs sought a declaration that she was in contempt of Court for failing to comply with her undertaking in those respects, an order that she be punished for contempt, and an order that she pay the plaintiffs’ costs of the motion on an indemnity basis.

4. [10]

   Annexed to the motion is a statement of charge setting out the undertaking and the 35 representations, the alleged breaches and particulars of them. To understand the representations and the breaches alleged it is necessary to reproduce the whole of that document, which I have done as an attachment to this judgment marked “A”.

5. [11]

   In par 5(a)(i) and (ii) of the statement of charge the reference in square brackets to “the letter” should presumably be “the email.” No point was taken about this.

6. [12]

   It will be seen that in a large number of the 35 representations, set out at par 2, the term “plaintiff” is used when, plainly enough, the person intended to be referred to was the defendant, Ms Melocco. This appears in 21 of the representations, in which the word “plaintiff” or “plaintiff’s” are used: those numbered 3, 4, 5, 6, 10, 11, 13, 14, 15, 16, 17, 19, 21, 22, 23, 24, 28, 30, 31, 32, 33. This is how the representations appeared in the attachment to the consent orders forwarded to the registrar on 17 March 2014. The effect of the evidence of Mr McKeough is that this was an error in the preparation of the document at his office.

7. [13]

   The letter to Ms Melocco of 26 February 2014 setting out the 35 representations and seeking her undertaking in respect of them, to which I have referred, used the personal pronouns “you” or “yours” in those representations, rather than referring to Ms Melocco by her status as the defendant in the proceedings. It seems that in preparing the attachment to the consent orders those personal pronouns were erroneously replaced by reference to the “plaintiff” instead of the “defendant”. Mr McKeough became aware of the error in the course of preparation of the deed of settlement to which I have referred, to which the undertakings were to be attached. In that attachment the error was corrected.

8. [14]

   This matter led to the filing by the plaintiffs of an amended notice of motion on 10 October 2014, in which appropriate amendments, pursuant to UCPR r 36.17, the “slip” rule, are sought to be made to the consent orders of 20 March. These amendments are opposed.

9. [15]

   Amendments are sought to representations 10, 11 and 13 whereby the word “plaintiff” is replaced by “defendant”, and in representations 10 and 11 the word “plaintiff’s” is replaced by “defendant’s”. The alleged breaches of Ms Melocco’s undertaking in respect of those representations are set out at par 5(d), (e) and (g) of the statement of charge.

10. [16]

    Before me Ms Melocco was represented by Mr Conomy, solicitor, assisted by Mr Laxon, solicitor. Their fundamental objection to the amendments, in written submissions by Mr Laxon developed orally by Mr Conomy, was that the errors in the wording of a large number of the representations meant that the contempt proceedings are fatally flawed. Reference was made to the statement by Gillard J of the essential requirements to establish a civil contempt of court involving a breach of a court order in National Australia Bank (NAB) Limited v Juric [2001] VSC 375 at [37]:

11. [17]

    In Mr Laxon’s written submissions it was argued that the misdescription of Ms Melocco in 21 of the representations renders them “a nonsense”, so that the undertaking fails to meet the second of the requirements set out by Gillard J: that its terms be “clear, unambiguous and capable of compliance.” Even if this were not so of the undertaking as a whole, it was argued, it certainly would be in relation to representations 10, 11 and 13. It would clearly be unjust to Ms Melocco, it was argued, to allow the amendments at this late stage after the commencement of the contempt proceedings. The submissions also questioned the utility of the amendments, given the provisions of the settlement deed regulating Ms Melocco’s conduct in respect of the representations (correctly expressed), but I shall deal with the deed as a separate issue.

12. [18]

    The plaintiffs were represented by Mr Blackburn SC with Mr Dawson. In written submissions they referred to authority for the proposition that extrinsic evidence may be used to construe an undertaking, at least where it is ambiguous. In S & M Motor Repairs v Caltex Oil (1988) 12 NSWLR 358, a case concerned with the breach of an undertaking, Priestley and Clarke JJA referred in the context of the case to “the importance of construing the undertaking in the factual matrix which was known to both parties” (at 387).

13. [19]

    In Athens v Randwick City Council [2005] NSWCA 317, 64 NSWLR 58, a case dealing with the breach of an order, Hodgson JA (Santow and Tobias JJA agreeing) said at [27] ff (69-71):

14. [20]

    In the course of that part of his judgment Hodgson JA cited with approval the judgment of Campbell J in Kirkpatrick v Kotis [2004] NSWSC 1265, 62 NSWLR 567, a case dealing with contempt by disobedience of consent orders. Campbell J said at [45] (575):

15. [21]

    White J also referred to Kirkpatrick v Kotis in Wyszynski v Bill (supra), noting at [30] that the principles enunciated by Campbell J apply to “orders of the Court as they do to undertakings given to the Court.”

16. [22]

    Counsel submitted that it was apparent from the surrounding circumstances that the person referred to as the “plaintiff” in the 21 representations, particularly the 10th, 11th and 13th of them the subject of the present proceedings, was intended to be Ms Melocco. In their written submissions they argued that the use of the term “plaintiff” was “manifestly erroneous”, such that the asserted representations made no sense unless Ms Melocco was understood to have been the person responsible for them.

17. [23]

    Reliance was placed upon the letter to her of 26 February 2014, in which the pronouns “you” and “yours” referred unambiguously to her. The ensuing correspondence between the solicitors was directed to the terms of that letter. In an affidavit of 8 October 2014, filed for the purpose of these proceedings, Ms Melocco deposed that she instructed her solicitor to give the undertakings that had been demanded of her in the 26 February letter, adding that she felt that she had no choice but to do so in the light of the threatened injunction proceedings and against the background of other matters asserted in the affidavit. She does not suggest in the affidavit that she was under any misapprehension as to the effect of the undertaking.

18. [24]

    Moreover, counsel pointed out that at an early stage of the proceedings Ms Melocco had consented to an order by Hallen J restraining her from making certain representations pleaded in the original statement of claim pending mediation (which, in the event, failed to resolve the matter). Thus she was no stranger to the obligation imposed upon her by the present undertaking.

19. [25]

    Views might vary as to whether the error in the relevant representations amounts to an ambiguity. In B & B Constructions (Aust) Pty Ltd v Brian A Cheeseman & Associates Pty Ltd (1994) 35 NSWLR 227, a case involving the issue of the reception of extrinsic evidence in construing a commercial contract, Kirby P observed (at 234) that the “perception of ambiguity differs from one judicial eye to the other.”

20. [26]

    In the present case counsel relied on extrinsic evidence – the background of the proceedings and the correspondence leading to the consent orders of 20 March – in support of the construction of the representations for which they contended and the application for amendment. The written submissions, developed orally by Mr Blackburn, cited the judgment of Campbell JA (with whom Handley AJA agreed) in AVS Group of Companies Pty Ltd v Commissioner of Police [2010] NSWCA 81, 78 NSWLR 302, a case involving the review of an administrative decision, in which his Honour said at [98] (322):

21. [27]

    In oral argument Mr Blackburn referred to Wende v Horwath (NSW) Pty Limited [2014] NSWCA 170, in which Basten JA (with whom Beazley P agreed) addressed the principles applicable to the construction of the order of a magistrate, noting the reference to Codelfa (supra) in authorities on this issue. His Honour continued at [64] :

22. [28]

    I am satisfied that the submissions of counsel for the plaintiffs should be accepted. Whether or not the erroneous reference to the “plaintiff” in the representations be classified as an ambiguity, it is appropriate to have regard to the background and, in particular, the correspondence leading to the consent orders of 20 March. It is clear that the person referred to as the “plaintiff” is Ms Melocco, and it is equally clear from the correspondence and from her affidavit that she gave the undertaking understanding that it was she who was said to have conveyed the representations. The use of the word “plaintiff” is a patent error, susceptible of correction by the slip rule. In the circumstances no injustice would be occasioned to Ms Melocco by allowing the amendments sought, and I shall do so.

23. [29]

    The material upon which contempt proceedings are based is described in par 4 of the statement of charge as the email of 3 April 2014, together with the “attachment constituting correspondence from the Australian Human Rights Commission to the defendant dated 1 April 2014.” In Mr Laxon’s written submissions, developed orally by Mr Conomy, it was acknowledged that the “email” is the document reproduced at pp 287-289 of exhibit AGM 2, but it was argued that the “attachment” was confined to the Human Rights Commission’s reasons for terminating Ms Melocco’s complaint, reproduced at pp 295-296. Thus, it was submitted, it was not open to the plaintiffs to rely upon anything in Ms Melocco’s complaint to the Commission, reproduced at p 297 ff of the exhibit, which is the source of much of the material relied upon. Indeed, at the hearing of the motion Mr Conomy objected to the admission into evidence of that material.

24. [30]

    The argument is without substance, and I allowed the material into evidence. As I have said, the “attachment” referred to in par 4 of the statement of charge is said to constitute the correspondence from the Human Rights Commission to the defendant dated 1 April 2014. It begins with the notice of termination, dated 1 April, to which is expressed to be annexed the reasons for the Commission’s decision (attachment A) and a copy of Ms Melocco’s complaint (attachment B). Plainly enough, all that material constitutes the “correspondence” for the purpose of par 4, embraced by the expression “the attachment” in that paragraph.

25. [31]

    I turn, then, to the settlement of the 2013 proceedings to which I have referred at [6] above. It was contended on behalf of Ms Melocco that the settlement deed terminated the entire proceedings, including these contempt proceedings. Counsel for the plaintiffs maintained that it does not extend to the contempt proceedings, which remain to be dealt with. It is necessary, firstly, to examine relevant provisions of the deed. It is described as a deed of release, and it was executed by the plaintiffs on 28 August 2014 and by Ms Melocco on 9 September 2014.

26. [32]

    Attached to the deed is a form of consent orders by which the claims in the further amended statement of claim of 16 May 2014 are dismissed and certain costs orders are made. Included in the representations pleaded in the further amended statement of claim were the 35 representations the subject of the contempt proceedings. All the representations in that statement of claim are defined in cl 1.1 of the deed as the “Representations.” Noted in the consent orders is an undertaking to the Court by Ms Melocco in identical terms to that of 17 March 2014, referring to the 35 representations which are also attached and in which the erroneous references to the “plaintiff” have been corrected. That undertaking is defined in cl 1.1 as the “Undertakings.”

27. [33]

    In Recitals to the deed it is recorded that the parties have agreed to settle the 2013 proceedings on the terms and additions set out in the deed without any admission by any of the parties; and that the plaintiffs, without admission, acknowledge that Ms Melocco “was genuinely distressed at times in connection with her involvement” with 1st Available and Mr Bartosch.

28. [34]

    By cl 2.1(a) of the deed Ms Melocco agrees, upon its execution and delivery, to give the Undertakings. Clause 3.1(a) provides that, upon entry into the deed, the plaintiffs release Ms Melocco from all claims relating to the Representations. However, cl 3.2 provides that that release does not affect the ability of the plaintiffs to enforce the deed or the Undertakings. The word “claims” is very widely defined in cl 1.1.

29. [35]

    Clause 7.1 provides:

30. [36]

    Clause 8.2 provides:

31. [37]

    The consent orders were filed with the registry online on 8 October 2014 (and, I take it, were entered by virtue of UCPR r 36.11(1)).

32. [38]

    In Mr Laxon’s written submissions reliance was placed upon the plenary terms of the deed, and the fact that it required a fresh undertaking by Ms Melocco in relation to the 35 representations, to support the argument that the intent of the deed was to put an end to the entire proceedings. The consent orders of 17 March 2014 were characterised as a contract between the parties which was varied by the deed. Reference was made to a passage from the judgment in Gilbert v Gilbert [1955] St R Qd 245 at 254, a decision of Townley J dealing with a financial agreement in a divorce case, as follows:

33. [39]

    Also cited was the following passage from the speech of Lord Diplock in Attorney-General v Times Newspapers Ltd [1974] AC 273 at 307-8:

34. [40]

    In the light of this authority, it was argued, the undertaking the subject of the contempt proceedings should be seen as having been given for the benefit of the plaintiffs but, by reason of the deed subsequently executed by the parties, they now have no right to insist on its enforcement through a motion in these proceedings. Reference was made to the decision of Merkel J in Louis Vuitton Malletier SA v Design Elegance Pty Ltd [2006] FCA 83, 149 FCR 494, where his Honour observed that it is “plainly prudent that any offer of a settlement or compromise of private claims, which arise out of conduct in breach of a court order, should clearly specify the private claims that are being settled and make quite clear what is intended, or not intended in respect of a contempt claim:” [45] (506).

35. [41]

    The submissions noted that cl 4 of the deed provided for a carve out of Ms Melocco’s ability to pursue any insurance claims in relation to workplace injury. A carve out in respect of the contempt proceedings, it was said, could have been included in that clause if that were the parties’ intention.

36. [42]

    Here also, counsel for the plaintiffs, in written submissions developed orally by Mr Blackburn, took me to the circumstances surrounding the deed. These are to be found in an affidavit of Mr McKeough of 21 October 2014 and the exhibit to that affidavit, “AGM-4.”

37. [43]

    By a letter to Mr Laxon of 16 July 2014, Mr McKeough conveyed his instructions that the plaintiffs would settle the claims in the 2013 proceedings on the terms which were later incorporated in the deed, including Ms Melocco’s “undertakings to the Court in the terms of the undertakings given to the Court on 20 March 2014, on a permanent basis.”

38. [44]

    In a separate letter to Mr Laxon of the same date, Mr McKeough wrote:

39. [45]

    The authority referred to in the first quoted paragraph was noted in footnotes as Louis Vuitton v Design Elegance at [44]-[45] (506). In that case Merkel J summarised the current law on civil contempt at [6] (497-8), as follows:

40. [46]

    What his Honour had to say at [44]-[45] was this:

41. [47]

    I note his Honour’s observation that the law on this issue “may be in an uncertain state.” I would not attempt to resolve that uncertainty without full argument on the matter and, in any event, I do not find it necessary to do so.

42. [48]

    As to the first of the letters of 16 July proposing the terms of settlement of the proceedings, Mr Laxon responded by a letter of 23 July conveying his instructions that the offer was accepted. In respect of the undertakings sought, he proposed that they “continue on an ongoing basis, or until further order.” As to the deed, he proposed that it “contain a mutual non-disparagement provision, in addition to the mutual releases, confidentiality and agreed form of statement in the event of inquiries.” He added:

43. [49]

    On 31 July 2014, there was a telephone conversation between Mr Laxon and Mr McKeough about the finalisation of the deed, in the course of which Mr Laxon said that Ms Melocco “will plead to the contempt and throw herself on the Court’s mercy.” On 1 August the contempt motion was before a registrar who, by consent, ordered that it be stood over to 29 August for referral to the duty judge. During August there were exchanges of emails between the parties concerning minor alterations to the draft deed.

44. [50]

    On 28 August, Mr Laxon stated in an email to Mr McKeough that Ms Melocco was “not yet well enough to deal with the contempt application” and proposed an adjournment until her health improved. On 29 August, the contempt motion was stood over to 9 October 2014 for referral to the duty judge, and a solicitor employed by Mr McKeough told the registrar, without demur on behalf of Ms Melocco, that the civil aspect of the proceedings had been settled and that the contempt motion was the only active part of the proceedings.

45. [51]

    In Mr Laxon’s submissions, again developed orally by Mr Conomy, it was argued that by its express terms the agreement enshrined in the deed meant the dismissal of the proceedings founded upon the further amended statement of claim with no exception with respect of the contempt motion. Accordingly, it was said, there is no ambiguity in the deed which might invite consideration of its surrounding circumstances. However, as counsel for the plaintiffs pointed out, this is inconsistent with the recent authority on the construction of commercial contracts referred to briefly by Basten JA in the passage from Wende v Horwath at [64], quoted above. His Honour referred to Electric Generation Corporation v Woodside Energy Ltd [2014] HCA 7, 251 CLR 640, at [35] (656), where the plurality said:

46. [52]

    In oral argument Mr Blackburn also referred to the judgment of Santow J (as he then was) in Karam v ANZ Banking Group [2001] NSWSC 709, in which his Honour reviewed the principles applicable to the construction of releases at [406]. It is sufficient for the present purposes to set out the first of those:

47. [53]

    In light of this authority, I am satisfied that it is appropriate to examine the circumstances surrounding the deed in the present case to which I have referred. From the communication between the solicitors for the parties and the conduct of the matter before the registrar, it is apparent, as counsel put it in written submissions, that the object of the deed “was to achieve a settlement of the causes of action pleaded in the further amended statement of claim.” Its purpose was “not to impose any restriction on the ability of the plaintiff to take steps to prosecute the contempt motion.” This is affirmed by the terms of the formal order relating to the disposition of the proceedings in the consent orders attached to the deed. Order 1 is that the “claims set out in the Further Amended Statement of Claim filed 16 May 2014 be dismissed.”

48. [54]

    Indeed, there is force in Mr Blackburn’s argument that there was a binding agreement to that effect when, in response to Mr McKeough's offer of settlement in his letter of 16 July 2014, Mr Laxon responded on 23 July conveying that he had instructions to accept the offer and adding that “we consider that the parties now have an agreement binding the parties to join in bringing the formal deed into existence and then carried into execution.”

49. [55]

    By that response, Mr Blackburn said, there was an agreement of the kind described in Masters v Cameron (1954) 91 CLR 353 at 360, that is, “one in which the parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form that would be fuller or more precise but not different in effect.” In the present case, Mr Blackburn noted, subsequent correspondence dealt with no more than minor alterations to the terms of the agreement. That being so, it was appropriate to have regard to the conduct of the parties thereafter. In Hughes v NM Superannuation Pty Ltd [1993] 29 NSWLR 653, Sheller JA (Kirby P and Meagher JA agreeing) observed (at 670) that “subsequent communications may be taken into consideration as a factor in order to determine whether prior dealings between the parties gave rise to a binding agreement.”

50. [56]

    In all the circumstances, I am satisfied that the deed and the consequential consent orders did not bring the contempt proceedings to an end. As counsel correctly put it in written submissions, so much is apparent from the text of the document, from its purpose and, in particular, from the factual circumstances known to the parties before it was executed.

51. [57]

    In Mr Laxon’s written submissions it was contended, in the alternative, that the plaintiffs had waived any contempt by pleading the 3 April email in the amended statement of claim of May 2014. Reference was made to the statement in Halsbury’s Laws of Australia at [105-265] that a “civil contempt may be waived by the opposing party taking another step in the action.” However, it is not apparent how the pleading of the email in the further amended statement of claim is a step amounting to waiver. In any event, in the light of the conduct of the parties which I have considered, there is no foundation for finding such a waiver.

52. [58]

    I turn, then, to the contempt charged, which must be established beyond reasonable doubt: Witham v Holloway (supra) in the plurality judgment at 528 – 534. It is not in dispute that Mrs Melocco sent the email of 3 April 2014 and its attachments to Mr Jacobs. However, I must be satisfied to the criminal standard that that material was in breach of her undertaking in the manner alleged in the statement of charge. I have referred above to the brief statement of the law of civil contempt by Merkel J in Louis Vuitton v Design Elegance at [6]. Authority on the nature of the breach which must be established was also summarised by Garling J in Commissioner of Fair Trading v Rixon (No 2) [2014] NSWSC 431 at [41-43], as follows:

53. [59]

    In his written submissions Mr Laxon considered each of the breaches alleged in the statement of charge and the particulars accompanying it, and submitted that none of them was made out. In respect of representations 10, 11 and 13 (par 5(d), (e) and (g) of the statement of charge), he relied on the misdescription of Ms Melocco as the “plaintiff”. To the extent that all the alleged breaches are founded on statements made in Ms Melocco’s complaint to the Human Rights Commission (attachment B to the correspondence), he mounted his argument that the complaint did not form part of the material specified in par 4 of the statement of charge. Both these submissions must be rejected for the reasons I have given.

54. [60]

    Otherwise, Mr Laxon’s submissions amounted to an analysis of the passages from the material particularised for each breach and an argument that they do not convey the representations complained of. However, it must be noted that for the purpose of each breach alleged reliance is expressly placed upon the totality of the email and the attachment. Further, in respect of 5 of the representations: 2, 7, 12, 18 and 34, reliance is expressed also to be placed upon particulars of other breaches. Mr Blackburn explained in oral argument that the particularised passages are merely highlights of the material said to give rise to the representations, specified for the assistance of Ms Melocco in setting out the case she is called upon to meet.

55. [61]

    It is necessary, then, to have regard to the whole of the material in the email and the attachment when considering each of the alleged breaches. I have done so. The combined effect of the passages particularised in respect of the breaches imports the flavour of the material as a whole. I must determine whether I am satisfied to the criminal standard that the material conveys each of the representations complained of. I accept Mr Blackburn’s submission that this involves consideration of how the material would be understood by the ordinary reasonable reader, a test akin to that to be applied in determining whether defamatory material conveys certain imputations: Amalgamated Television Services Pty Ltd v Marsden (1998) 43 NSWLR 158, per Hunt CJ at CL at 164.

56. [62]

    I am satisfied that the material gives rise to the 9 representations complained of. It is unnecessary to examine the material in its totality or to address each of the particularised passages. However, I shall deal briefly with each of the alleged breaches, by reference to the subparagraphs of par 5 of the statement of charge.

57. [63]

    Mr Laxon’s written submissions also take the point that representations 1, 7, 18 and 34 are expressed in the present tense, while the material relied upon to demonstrate the breach of them consists of Ms Melocco’s description of past events. It was argued that I could not be satisfied that the email and attachments convey that the behaviour alleged in those representations was continuing. However, reading the material as a whole, I reject this argument. As Mr Blackburn pointed out, the whole tenor of the material is that not only have these things been done but they are, as he put it, “the current modus operandi” of Mr Bartosch and 1st Available.

58. [64]

    Accordingly, I am satisfied beyond reasonable doubt that by sending the email and the accompanying material Ms Melocco was in breach of her undertaking in respect of nine of the representations in the manner alleged in the statement of charge. The question remains whether those breaches amount to contempt of court.

59. [65]

    In her affidavit Ms Melocco deposed that, after the termination by the Human Rights Commission of her complaint, she did not have the funds to pursue her “victimisation complaint” through the Federal Court, the course said to be open to her in the Commission’s reasons. Accordingly, she decided to make “one last attempt to resolve matters” through Inteq, given its role as “corporate advisory and strategist” for 1st Available. She believed that it was pointless contacting 1st Available or Mr Bartosch because at that stage proceedings had been instituted against her. It was for that reason that she sent the email with its attachments to Mr Jacobs.

60. [66]

    The concluding paragraphs of her affidavit are in the following terms:

61. [67]

    Since October 2013, Ms Melocco has been receiving treatment from a clinical psychologist, Dr Nicholas Marlowe. I received a report of Dr Marlowe into evidence, after excising some portions which I found to be inadmissible, and he gave brief oral evidence. He has been treating Ms Melocco for symptoms of major depression and post traumatic stress disorder, attributed to her experience of working for 1st Available and, in particular, her conflict with Mr Bartosch. Dr Marlowe’s report records a history of suicidal ideation and a suicide attempt in November 2013. He also noted that pending court proceedings tended to trigger in her “powerful suicidal thoughts and impulses.” His opinion was that she requires “ongoing psychological treatment and careful monitoring” to make a full recovery and that recovery is unlikely while she continues to face legal proceedings.

62. [68]

    Mr Conomy sought to make a case that Ms Melocco’s breaches of her undertaking were “casual, accidental or unintentional”, the expression used in the authorities summarised by Garling J in Commissioner of Fair Trading v Rixon set out above. He relied upon the psychological evidence, together with par 29 of her affidavit which I have quoted.

63. [69]

    In my view, that case is unsustainable. It establishes no more than that at the time Ms Melocco sent the offending email she was distressed and did not turn her mind to her undertaking. The fact remains that the email demonstrates a deliberate and considered course of action, and nothing in the psychological material suggests any defect of cognition. The material relied upon by Mr Conomy may well bear upon penalty, but not upon her guilt.

64. [70]

    I accept Mr Melocco’s assertion in her affidavit that she did not send the email in conscious defiance of her undertaking. Nevertheless, her breaches were wilful in the sense considered by the High Court in Australian Meat Industry Employee’s Union v Mudginberri Station (supra) at 109 – 113. If she had sent the email conscious that it was in breach of her undertaking, her conduct would have been contumacious, an expression also considered by the High Court in the same passage. The plaintiffs did not seek to make out such a case.

65. [71]

    Accordingly, I find Ms Melocco guilty of contempt.

66. [72]

    I am indebted to counsel and to Mr Laxon for the exposition in their written submissions of relevant sentencing principles, and I am conscious of the breath of the discretion available to me in the present case. I am mindful that any breach of an undertaking to a court amounting to contempt is a serious matter, and that regard must be had to deterrence, personal and general. In written submissions counsel for the plaintiffs suggested that a bond under s 9 of the Crimes (Sentencing Procedure) Act 1999 might be appropriate, while Mr Laxon submitted that no more than a bond under s 10 of that Act was called for. In oral argument Mr Blackburn did not wish to be heard on penalty, saying that it was very much for the court.

67. [73]

    After careful consideration, and having regard to Ms Melocco’s apology for her conduct in par 30 of her affidavit, I have decided that it is not expedient to impose any penalty upon her. I have regard to matters in mitigation fairly raised by Mr Laxon in his written submissions. I accept that she perceives herself to have been treated unjustly by the plaintiffs over a significant period, and that her motive in sending the email to Mr Jacobs was to seek some form of redress. Of course, whether her perception of unjust treatment is well founded is not a matter for me to decide, and is not relevant for present purposes.

68. [74]

    She is a mature woman, in her late 50’s and, apparently, a person of otherwise good character. She suffers a severe psychological condition, requiring ongoing treatment. When she was present at the hearing of the contempt proceedings she was visibly distressed. I have no doubt that these proceedings have been a stressful experience for her but, I hope, a salutary one. I think it unlikely that she would reoffend in this way.

69. [75]

    Of course, she must play the plaintiffs’ costs of the contempt motion, and on an indemnity basis. In NCR Australia v Cricket Connection [2005] NSWSC 1118, Campbell J said at [102]:

70. [76]

    Accordingly, I make the following orders: