Kostov v Nationwide News Pty Ltd (No.2)

The background to this judgment is to be found in my first judgment of Kostov v Nationwide News Pty Ltd (No 1) [2018] NSWSC 1822 (the first judgment). In that judgment I dismissed the present proceedings (referred to in that judgment as the Second Equity Proceedings), although reserving the defendant’s rights to pursue a contempt charge referred to in prayers 4 and 5 of the defendant’s amended notice of motion filed 19 October 2018.

Prayers 4 and 5 are as follows:

The contempt charge arose from what were alleged to be breaches by the plaintiff of an order made by Registrar Walton on 27 August 2018. As noted at [17] of the first judgment, the order made by the Registrar was in these terms:

On the occasion the order was made, the defendant was represented by a solicitor, Juri Yoshida. On 27 August 2018 Mr Yoshida informed the defendant of the order made by the Registrar in a telephone conversation and by email.

Prior to the making of this order, the plaintiff had on 4 May 2018 given an undertaking to the Court in these terms in proceedings 2018/87917 (described in the first judgment as the Defamation Proceedings):

Despite that undertaking, the plaintiff continued to send emails to other officers of the defendants in those proceedings.

On 18 May 2018 an order was made in those proceedings preventing the plaintiff from communicating with officers of the defendants. That order was varied on 5 June 2018 to enjoin the plaintiff from communicating with any officer or employee of the defendants except for Gina McWilliams.

On 17 August 2018 the plaintiff sent an email to Ms McWilliams which was copied to nine named persons at News Corp Australia.

On 17 August 2018 Ms McWilliams emailed the plaintiff requesting that she cease and desist from communicating directly with the defendant.

On 20 August 2018 the plaintiff again emailed the persons referred to at [8] above and two other persons at News Corp Australia. It was in those circumstances that the order was made by the Registrar in the present proceedings on 27 August 2018.

On 18 October 2018 at 3:14pm the defendant wrote an email entitled “Daily Telegraph article – March 2018 – Request for removal (Kostov, Adriana)”. The email was sent to:

On 18 October 2018 at 3:34pm the plaintiff wrote an email entitled “Daily Telegraph article – March 2018 – Request for removal (Kostov, Adriana)” that communicated information about the present proceedings. The email was sent to the following persons:

On 18 October 2018 at 8:51pm the plaintiff sent an email to the Court which communicated information about the present proceedings. The email was sent to the following persons:

On 19 October 2018 the defendant filed its amended notice of motion which, in addition to the relief which I granted in the first judgment, sought relief in terms of paragraphs 4 and 5.

On 20 October 2018 at 6:00pm the plaintiff wrote an email entitled “For Mr Murdoch – Daily Telegraph article – March 2018 - Request for removal (Kostov, Adriana)” that communicated information about the present proceedings. The email was sent to the following persons:

On 20 October 2018 at 6:49pm the plaintiff wrote an email entitled “Nationwide News threat to “punish” me, for protecting myself, and my family” that communicated information about the present proceedings. The email was sent to the following persons:

On 22 October 2018 at 9:00am the plaintiff telephoned the Daily Telegraph and had an oral conversation with Sarah Keoghan, Editorial Assistant during which conversation the plaintiff asked for the published article to be removed from the website. Ms Keoghan did not know who the plaintiff was nor did she know of the existence of the order. She told the plaintiff to put her complaints in writing and email them to sarah.keoghan@news.com.au.

On 22 October 2018 at 9:55am the plaintiff wrote an email entitled “Daily Telegraph article – March 2018 - Request for removal (Kostov, Adriana)” that communicated information about the present proceedings. The email was sent to Ms Keoghan at the Daily Telegraph at the address given to her by Ms Keoghan.

On 22 October 2018 at 12:26pm the plaintiff wrote an email entitled “Kostov v Nationwide News – Health and Safety – Avoidance of Harm” that communicated information about the present proceedings. The email was sent to the following persons:

A Statement of Charge was served on 19 October 2018, and an Amended Statement of Charge asserting wilful breaches in respect of the matters set out at [11]-[19] above was served on 24 October 2018.

I had reserved my judgment on the defendants’ applications to dismiss the various proceedings brought by the plaintiff on a summary basis and on the defendant’s application to have the plaintiff found guilty of contempt. Shortly before 28 November 2018 I became aware that there was a judgment pending in the Court of Appeal on appeal from a judgment of Fagan J in Kostov v YPOL Pty Ltd [2017] NSWSC 1071. My understanding from the judgment of Fagan J was that similar matters were involved as were alleged against the plaintiff in the Amended Statement of Charge in the present proceedings. That is, contrary to an order of this Court preventing the plaintiff from communicating with various persons, the plaintiff did precisely that. On 28 November 2018 I informed the parties about that pending judgment.

I delivered judgment on 30 November 2018 on all aspects of the defendants’ motions except the contempt matter, and adjourned the proceedings to 13 December 2018.

On 12 December 2018 the Court of Appeal delivered judgment in the appeal from Fagan J: ZXC v YPOL Pty Ltd [2018] NSWCA 306. It should be noted that since a non-publication order has been lifted the judgment is now known as Kostov v YPOL Pty Ltd [2018] NSWCA 306.

In the meantime, the plaintiff had notified my Associate that on the adjourned date she would be making an application for pro bono assistance to meet the contempt charge brought by the defendants.

When the matter came before me on 13 December 2018 it was adjourned by consent to 1 February 2019. The purpose of the adjournment was to enable both parties to consider the judgment of the Court of Appeal and its applicability to the contempt charge before me. It was also adjourned to enable the plaintiff to make an application for pro bono assistance, should she wish to do so.

On 23 January 2019 Ms McWilliams, wrote to the plaintiff in these terms:

The letter enclosed proposed short minutes of order providing for the dismissal of prayers 4 and 5 of the amended notice of motion filed 19 October 2018 and providing that there be no order as to costs.

The plaintiff responded on 24 January rejecting the offer to withdraw the contempt charge. The plaintiff said that she would only accept the offer if an apology was offered by Nationwide News, that she was compensated for what she had been put through by the publication of the articles, and that two invoices she attached would be paid by Nationwide News. Those invoices were for $770 and $400 respectively for two lawyers to attend Court on the plaintiff’s behalf.

The proceedings were listed for further directions on 1 February 2019 at 9:30am. At 9:18am the plaintiff forwarded an email to my Associate and to Ms McWilliams saying that she did not agree to the defendant’s proposed orders. She asked that the parties be given leave to prepare costs submissions, with costs orders being made in chambers.

The plaintiff did not appear at the directions hearing. Mr Lewis of counsel for the defendant agreed to the course of action proposed by the plaintiff in her email. He indicated that, depending on what submissions were made by the plaintiff, the defendant might not wish to forward any submissions in relation to costs.

The plaintiff duly forwarded written submissions on 14 February 2019. In those submissions she claimed costs of “approximately $6,000”. Nothing was said in the submissions to explain how the figure of $6,000 was reached.

The plaintiff submitted that the defendant incurred the costs itself and failed to mitigate its damage. She submitted that she repeatedly asked the defendant to remove the matter complained of, and that doing so would have cost the defendant nothing. She submitted that, instead, the defendant chose to spend thousands of dollars in court costs and that the defendant abused the process of the courts.

The plaintiff submitted that the defendant engaged in malicious behaviour by sending process servers to her workplace and by threatening her with contempt proceedings. The plaintiff submitted that these were all unnecessary costs.

The plaintiff submitted that she had incurred much disruption to her work, she needed to brief various lawyers to appear, and she had to make her own submissions in the proceedings.

She submitted that the defendant’s legal counsel acted out of personal spite towards the plaintiff. She submitted that she, the plaintiff, was simply exercising a right by asking to have the article taken down, and that the defendant could have done so at no cost, which would have meant the plaintiff would not have incurred costs.

No costs submissions were made by the defendant.

Although the plaintiff said that she was rejecting the defendant’s offer to withdraw the proceedings on the basis of no order as to costs (as if the offer to withdraw was a conditional one), the parties have since proceeded on the basis that the defendant was seeking to have prayers 4 and 5 dismissed in any event, and for me to determine, in those circumstances, what order for costs should follow.

I consider, for the reasons which follow, that in all the circumstances there should be no costs order in relation to the contempt claim.

The judgment of the Court of Appeal in Kostov v YPOL dealt with an appeal against a conviction of the plaintiff for contempt by communicating with a number of persons who were servants, agents, employees and legal representatives of the defendants in those proceedings. An order had been made to that effect by Bellew J on 1 December 2016. The plaintiff communicated with various persons protected by Bellew J’s order, and on that basis Fagan J held that the plaintiff was guilty of contempt of court.

The judgment of the Court of Appeal identified that at the time of the contempt hearing before Fagan J there was psychiatric evidence that the plaintiff was suffering from a major depressive episode as part of a bipolar mood disorder, and lacked insight into her behaviour. A report from another psychiatrist, Dr Andrew Ellis, expressed the opinion that it was likely that the plaintiff would not, from a psychiatric point of view, have been considered fit to be tried because she had significant formal thought disorder.

Before the Court of Appeal, the plaintiff maintained that her medical circumstances had changed, that she had “recovered” and that she was “back at work”. The Court of Appeal found, however, that there was no further evidence before the Court concerning her medical condition at that time to demonstrate that things had changed.

After the judgment of the Court of Appeal became available to the defendants in the present proceedings, Ms McWilliams wrote the letter to the plaintiff set out at [26] above and made the open offer to the plaintiff contained in that letter.

By that time, to the extent that the plaintiff had appeared or made any submissions in relation to the contempt charge, the only point made by her to justify what were, prima facie, a large number of wilful breaches of the order of the Registrar, was that the plaintiff was simply protecting herself by endeavouring to have the article removed from the website. She maintained that position when lodging her submissions in relation to the present costs argument.

It is quite possible that, if the matter were investigated, it might be found that the plaintiff’s medical condition at the time the communications in the present matter were made was the same as was found by the Court of Appeal in Kostov v YPOL. This aspect of the plaintiff’s medical or psychiatric condition had not been disclosed in the present proceedings until the Court of Appeal’s judgment was delivered on 12 December 2018. What was said in that judgment was no doubt a significant reason the defendant made the offer to abandon the contempt charge.

Further, the order declaring the plaintiff a vexatious litigant and my orders preventing her from instituting any further proceedings until various costs orders were paid were not made until after the amended notice of motion and the Amended Charge were filed.

Nevertheless, in the light of the repeated number of communications made by plaintiff in contravention of the Registrar’s order, the defendants were entirely justified in seeking the relief contained in prayers 4 and 5 of the amended notice of motion.

There can be no doubt that the plaintiff knew what she was prohibited from doing because of her prior undertaking and the prior order of McCallum J in the Defamation Proceedings. There can also be no doubt that the plaintiff knew what she was doing when she sent the various emails, because her explanation made clear her purpose, which was the same purpose that formed the basis of all of the proceedings, namely, the removal of the article.

A number of the submissions made by the plaintiff appear to deal with costs incurred by the defendant in bringing the contempt charge against her. However, the defendant makes no claim for those costs.

Initially the plaintiff’s claim that her own costs be paid by the defendant, was confined to the two invoices she had received from lawyers who appeared on her behalf before Registrar Walton, and before me on 13 December when the matter was listed for mention only. As noted, those invoices totalled $1,170. As I have earlier indicated, the plaintiff now seeks costs of $6,000 although how the difference between $1,170 and $6,000 is made up is not identified.

The contempt charge was reasonably brought in all the circumstances and, subject, perhaps, to clarification of the plaintiff’s mental state, was likely to have been proved. The defendants acted reasonably in indicating that they did not wish to pursue the proceedings after the Court of Appeal’s judgment in Kostov v YPOL was published, and after the other orders were made. For those reasons, I consider that each party should bear her and its own costs of that part of the motion concerned with the contempt charge.

The orders I make are these: