FEDERAL COURT OF AUSTRALIA
Bond v Barry [2007] FCA 1484
PRACTICE AND PROCEDURE – summary dismissal – no reasonable prospect of success – criteria – application dismissed
Trade Practices Act 1974 (Cth)
Fair Trading Act 1987 (WA)
Fair Trading Act 1987 (NSW)
Second Reading Speech for the Statute Law (Miscellaneous Provisions) Bill (No 2) 1984
Advanced Hair Studio Pty Ltd v TVW Enterprises Ltd (1987) 18 FCR 1 cited
Australian Ocean Line Pty Ltd v West Australian Newspapers Ltd (1983) 66 FLR cited
Australian Ocean Line Pty Ltd v West Australian Newspapers Ltd (1985) 58 ALR 549 cited
Carlovers Carwash Ltd v Sahathevan [2000] NSWSC 947 cited
Global Sportsman Pty Ltd v Mirror Newspapers Pty Ltd (1984) 2 FCR 82 cited
Infabrics Ltd v Jaytex Ltd [1981] 1 All ER 1057 cited
Krahe v Freeman (1988) ATPR 40-871 cited
Universal Telecasters (Qld) Ltd v Guthrie (1978) 32 FLR 360 cited
Universal Telecasters (Qld) Ltd v Ainsworth Consolidated Industries Ltd (1983) ATPR 40-384 cited
Webb v Bloch (1928) 41 CLR 331 cited
Shorter Oxford English Dictionary (5th ed, Oxford University Press, 2002)
WAD 121 OF 2007
FRENCH J
21 SEPTEMBER 2007
PERTH
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IN THE FEDERAL COURT OF AUSTRALIA |
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WESTERN AUSTRALIA DISTRICT REGISTRY |
WAD121 OF 2007 |
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BETWEEN: |
ALAN BOND First Applicant
LESOTHO DIAMOND CORPORATION PLC Second Applicant
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AND: |
PAUL BARRY First Respondent
NEWS DIGITAL MEDIA PTY LTD Second Respondent
NATIONWIDE NEWS PTY LTD Third Respondent
NEWS LIMITED Fourth Respondent
NEIL LAURENCE BREEN Fifth Respondent
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FRENCH J |
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DATE OF ORDER: |
21 SEPTEMBER 2007 |
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WHERE MADE: |
PERTH |
THE COURT ORDERS THAT:
1. The application is dismissed.
2. The applicants are to pay the respondents’ costs of the application.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
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IN THE FEDERAL COURT OF AUSTRALIA |
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WESTERN AUSTRALIA DISTRICT REGISTRY |
WAD121 OF 2007 |
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BETWEEN: |
ALAN BOND First Applicant
LESOTHO DIAMOND CORPORATION PLC Second Applicant
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AND: |
PAUL BARRY First Respondent
NEWS DIGITAL MEDIA PTY LTD Second Respondent
NATIONWIDE NEWS PTY LTD Third Respondent
NEWS LIMITED Fourth Respondent
NEIL LAURENCE BREEN Fifth Respondent
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JUDGE: |
FRENCH J |
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DATE: |
21 SEPTEMBER 2007 |
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PLACE: |
PERTH |
REASONS FOR JUDGMENT ON MOTION TO DISMISS PROCEEDINGS
Introduction
1 In June 2007 an article appeared in The Sunday Telegraph newspaper in New South Wales and in The Sunday Times newspaper in Western Australia which concerned Mr Alan Bond and a diamond mining company, Lesotho Diamond Corporation Plc (Lesotho Diamond) which operates in the Kingdom of Lesotho in South Africa. The article reported on the relationship between Mr Bond and the company, its shareholders, executive and two chairmen of its board and his conduct as its consultant. The article was written by a freelance journalist, Paul Barry. It was published by Nationwide News Pty Ltd (Nationwide News). It also appeared on a website “News.Com” operated by News Digital Media Pty Ltd (News Digital). The companies are members of the News Group of companies which includes News Limited.
2 Mr Bond and Lesotho Diamond have commenced proceedings against Mr Barry, the companies and the editor of The Sunday Telegraph, Mr Breen. They say Mr Barry has contravened provisions of the Fair Trading Acts 1987 of Western Australia and New South Wales and of the Trade Practices Act 1974 (Cth) (the TPA) which prohibits misleading or deceptive conduct. They say Mr Breen has also contravened s 52 of the TPA. They sue the companies as accessories in those contraventions.
3 Mr Barry, Mr Breen and the News Group companies say that, regardless of the merits of the complaints about Mr Barry’s article, these proceedings cannot succeed. They say that they are exempted from the application of the relevant provisions of the TPAand the Fair Trading Acts by a specific section in each which creates a media safe harbour. They move to dismiss the proceedings under s 31A of the Federal Court of Australia Act 1976 (Cth) on the basis that there is no reasonable prospect of success. I agree that the proceedings have no reasonable prospect of success and should be dismissed with costs for the reasons that follow.
The amended statement of claim
4 The factual narrative that follows is derived from the amended statement of claim. The identity of the parties, the nature of their respective businesses and the arrangements with Mr Barry that led to the publication of the article in contention in this case are, for the most part, not in dispute.
5 Lesotho Diamond is incorporated under the laws of Gibraltar. It holds mining leases in Kao in the Kingdom of Lesotho in South Africa. It is the developer of a prospective diamond mine in the area covered by the licences. Alan Bond is a consultant to the company.
6 Paul Barry carries on business as a freelance journalist in Australia and other places. Between the middle of May 2007 and 1 June 2007 Mr Barry researched and wrote an article about Mr Bond and Lesotho Diamond. He did so under an oral agreement with the editor of The Sunday Telegraph, Mr Neil Breen. By that agreement, according to the defence which has been verified on affidavit, he was paid $15,000 and his travel expenses to England and South Africa. Mr Barry sent the text of the article by emails to Mr Breen.
7 The Sunday Telegraph is a weekly newspaper published by Nationwide News. That company publishes a number of newspapers nationally and in different States of Australia. It publishes The Sunday Telegraph in New South Wales and the weekly newspaper known as “The Sunday Times” in Western Australia. It also publishes the daily newspaper known as “The Daily Telegraph” in New South Wales.
8 After receiving the emails from Mr Barry, Mr Breen is alleged to have sent the substance of the article to the editors of other newspapers published by Nationwide News. In any event the article was published by:
1. News Digital on its website “News.Com” from 3 June 2007.
2. Nationwide News as the cover story in The Sunday Times of 3 June 2007 under the heading “Bond the $1B Man”.
3. Nationwide News in The Sunday Telegraph of 3 June 2007 under the heading “The greed that won’t let Alan Bond rest – Special Investigation – America’s Cup hero and convicted fraudster poised to become oil and diamond billionaire”.
9 Mr Bond and Lesotho Diamond say that Mr Barry’s conduct was in trade or commerce in respect of the supply of “goods or services” in Western Australia and New South Wales as he wrote the article for the purposes of selling the copyright in it and to authorise the publication which occurred. They also say that his conduct in writing the article for publication in Western Australia and in New South Wales was misleading or deceptive or likely to mislead or deceive in contravention of s 10 of the Fair Trading Act 1987 (WA) and s 42 of the Fair Trading Act 1987 (NSW) respectively.
10 Insofar as Mr Barry’s conduct involved writing the article for publication on the worldwide web and sending it by email he is said to have contravened s 52 of the TPA. Mr Bond and Lesotho Diamond rely upon the extended application of the TPA to individuals using telephonic services (s 6(3)(a)). Similarly, Mr Breen is said to have contravened s 52 by sending the article by email to other editors.
11 News Digital and News Limited are alleged to have “aided and abetted” Mr Barry to contravene s 52 of the TPA by publishing the article on the internet and authorising its publication. By publishing the article in The Sunday Times newspaper, Nationwide News is said to have been “involved”, within the meaning of s 74 of the Fair Trading Act (WA), in Mr Barry’s contravention of s 10 of that Act. It is also alleged that Nationwide News was involved in his contravention of the Fair Trading Act (NSW) by publishing the article in The Sunday Telegraph.
12 Mr Bond and Lesotho Diamond say that Mr Barry’s article was misleading or deceptive or likely to mislead or deceive because a number of the statements contained in it were false. The statements they identify in this respect are:
1. That Mr Bond takes all the decisions of Lesotho Diamond.
2. That Mr Bond maintains a lavish London office at company expense.
3. That Mr Bond’s role in the company has led to the departure of one experienced chief executive officer and two well regarded chairmen.
4. That Mr Bond is “locked in a bitter battle” over Lesotho Diamond.
5. That Mr Bond has fallen out with almost all of his fellow shareholders.
6. That one founding shareholder has accused him of “rape and pillage”.
7. That rebel shareholders in Lesotho Diamond accused Mr Bond of paying himself massive fees, trying to sell dud assets into the company and using shareholders’ money for personal advantage.
8. That shareholders accused Mr Bond of squandering up to $20 million of the $35 million that has been raised.
13 Mr Bond and Lesotho Diamond claim that unless restrained by court order Mr Barry intends to further publish the article and that News Digital, Nationwide News and News Limited intend to aid and abet that further publication. They also say that they have suffered loss and damage by the conduct of Mr Barry, Mr Breen and the News Group companies.
The media safe harbour defence invoked
14 By their amended defence the respondents admit all the allegations relevant to their identities and the nature of the businesses which they carry on. They admit that Mr Barry researched and wrote the article referred to and sent it by email to Mr Breen. They plead in the defence the terms of Mr Barry’s engagement by Mr Breen. They do not admit that Mr Breen sent the substance of the article by email to other editors of newspapers published by Nationwide News. What they say, however, is that the article published by The Sunday Telegraph was accessed through the internal communications systems of Nationwide News and used as the template for the article published in The Sunday Times.
15 It is admitted that Mr Barry’s conduct in researching and writing the article was in trade or commerce and that Mr Breen was acting in trade or commerce when he engaged him by commission to write the article. The respondents also say that Mr Barry’s conduct as a freelance journalist in researching, writing and submitting to Mr Breen the text of what became the article amounted to conduct in New South Wales in trade and commerce. Mr Barry accepts that his commission envisaged his consent to the likely publication, by The Sunday Telegraph and The Sunday Times newspapers in Australia or other media institutions within the News Group in Australia, of the substantial terms of the text which he submitted.
16 The allegations that the article contained false statements and that Mr Barry engaged in misleading or deceptive conduct are denied. It is admitted that his conduct in writing the article for publication in the State of New South Wales by Nationwide News was conduct in connection with goods or services supplied in that State within the meaning of s 5A of the Fair Trading Act (NSW). Although it is admitted that the article was published by News Digital on the worldwide web that is said to have been done without Mr Barry’s involvement. The allegations of contravention of s 52 of the TPA by Mr Barry and Mr Breen are expressly denied. The respondents do however admit that News Digital published the article on the worldwide web and say that media organisations within the News Group were authorised by Mr Barry to publish the text of what he submitted. They specifically deny that News Limited authorised publication of the article by News Digital on the worldwide web.
17 The pleas of accessorial liability are also denied.
18 In [11] and [11A] of the defence, the respondents invoke the media safe harbour defence as follows:
11. Further, and in the alternative, if (which is denied) the Article, or the text of what was submitted by the First Respondent was misleading or deceptive, in contravention of section 52 of the Trade Practices Act 1974 (Cth) (or section 10 of the Fair Trading Act (WA) (‘FTA (WA)’) (or section 42 of the Fair Trading Act (NSW) (‘FTA (NSW)’) as pleaded in paragraphs 13, 14, 15 and 16 of the Amended Statement of Claim, then the Respondents say that the First Respondent prepared and submitted the text of the Article as a prescribed publication of matter and as a prescribed information provider, in the course of his business as a freelance journalist with the consequence accordingly that the First Respondent is exempted from liability under the TPA or FTA (WA) or FTA (NSW) by application of the provisions of section 65A of the TPA and/or section 63 of the FTA(WA) and/or section 60 of the FTA (NSW).
11A. Further, the Respondents repeat paragraph 11 of their Defence above mutatis mutandis as regards the assertion of misleading or deceptive conduct contrary to section 52 of the TPA, as against the Fifth Respondent as Editor of The Sunday Telegraph and rely upon the protective application in his favour of section 65A of the TPA.
19 The defence as it stood prior to an amendment which brought in Mr Breen as a party, is verified by affidavits sworn by Mr Barry and Mr Breen on behalf of Nationwide News.
The motion for dismissal
20 On 15 August 2007 the first four respondents filed a notice of motion seeking orders in the following terms:
1. Pursuant to s 31A(2) of the Federal Court Act 1974 (as amended), the proceedings as against all the respondents do be dismissed.
2. Alternatively, pursuant to O 11 r 16(a) or (b) of Federal Court Rules that paragraphs 4, 5, 6, 12, 13, 14 and 15 of the Statement of Claim do be struck out as against the Second, Third and Fourth Respondents.
3. The applicants pay the respondents’ costs on the application of the respondents’ motion.
21 On 12 September 2007 orders were made giving leave to Mr Bond and Lesotho Diamond to join Mr Breen as the fifth respondent and to amend the statement of claim in terms of a minute then exhibited to an affidavit of Ms Batalin. The respondents were given leave to file an amended defence in terms of the minute also filed in Court.
22 Argument on the motion proceeded on 12 September 2007 and judgment was reserved until today. Before turning to the arguments and the merits of the motion, it is necessary to have regard to the statutory provisions which are applicable.
Statutory framework – Federal Court of Australia Act 1976 (Cth)s 31A
23 The motion is brought under s 31A of the Federal Court of Australia Act 1976 (Cth). That section provides:
(1) The Court may give judgment for one party against another in relation to the whole or any part of a proceeding if:
(a) the first party is prosecuting the proceeding or that part of the proceeding; and
(b) the Court is satisfied that the other party has no reasonable prospect of successfully defending the proceeding or that part of the proceeding.
(2) The Court may give judgment for one party against another in relation to the whole or any part of a proceeding if:
(a) the first party is defending the proceeding or that part of the proceeding; and
(b) the Court is satisfied that the other party has no reasonable prospect of successfully prosecuting the proceeding or that part of the proceeding.
(3) For the purposes of this section, a defence or a proceeding or part of a proceeding need not be:
(a) hopeless; or
(b) bound to fail;
for it to have no reasonable prospect of success.
(4) This section does not limit any powers that the Court has apart from this section.
Statutory framework – Trade Practices Act 1974 (Cth) – the primary prohibition
24 The applicants assert primary liability on the part of Mr Barry for contravention of the Fair Trading Acts of Western Australia and New South Wales as well as s 52 of the TPA. They also allege that Mr Breen contravened s 52. The relevant provisions of the State Acts replicate s 52. Section 52 provides:
(1) A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.
(2) Nothing in the succeeding provisions of this Division shall be taken as limiting by implication the generality of subsection (1).
Remedies for the contravention of s 52 are provided for in Pt VI of the TPA. They allow the Court to award injunctive relief and damages and to make other remedial orders (ss 80, 82 and 87 respectively).
Statutory framework - accessorial liability
25 Persons other than those who contravene s 52 may be liable to the remedies under Pt VI if they are “involved in” a contravention by somebody else. The concept of involvement in a contravention is defined, at the beginning of Pt VI, in s 75B(1) which provides:
A reference in this Part to a person involved in a contravention of a provision of Part IV, IVA, IVB, V or VC, or of section 75AU, 75AYA or 95 AZN, shall be read as a reference to a person who:
(a) has aided, abetted, counselled or procured the contravention;
(b) has induced, whether by threats or promises or otherwise, the contravention;
(c) has been in any way, directly or indirectly, knowingly concerned in, or party to, the contravention; or
(d) has conspired with others to effect the contravention.
26 Section 80 authorises the award of injunctive relief against contravenors and persons engaged in conduct of the kind referred to in s 75B(1) and persons who attempt to contravene a provision of Pt V (inter alia). Section 82 allows recovery of damages against the contravenor and “… any person involved in the contravention”. Involvement in a contravention can also attract the application of remedies for which s 87 provides.
27 It is important to note that a person involved in a contravention of s 52 does not thereby contravene it. The defined concept of involvement in a contravention establishes a basis for the grant of relief. It is a distinct head of liability.
Statutory framework – the media safe harbour
28 A media safe harbour is created by s 65A which provides:
(1) Nothing in section 52, 53, 53A, 55, 55A or 59 applies to a prescribed publication of matter by a prescribed information provider, other than:
(a) a publication of matter in connection with:
(i) the supply or possible supply of goods or services;
(ii) the sale or grant, or possible sale or grant, of interests in land;
(iii) the promotion by any means of the supply or use of goods or services; or
(iv) the promotion by any means of the sale or grant of interests in land;
where:
(v) the goods or services were relevant goods or services, or the interests in land were relevant interests in land, as the case may be, in relation to the prescribed information provider; or
(vi) the publication was made on behalf of, or pursuant to a contract, arrangement or understanding with:
(A) a person who supplies goods or services of that kind, or who sells or grants interests in land, being interests of that kind; or
(B) a body corporate that is related to a body corporate that supplies goods or services of that kind, or that sells or grants interests in land, being interests of that kind; or
(b) a publication of an advertisement.
(2) For the purposes of this section, a publication by a prescribed information provider is a prescribed publication if:
(a) in any case – the publication was made by the prescribed information provider in the course of carrying on a business of providing information; or
(b) in the case of a person who is a prescribed information provider by virtue of paragraph (a), (b) or (c) of the definition of prescribed information provider in subsection (3) (whether or not the person is also a prescribed information provider by virtue of another operation of that definition) – the publication was by way of a radio or television broadcast by the prescribed information provider.
(3) In this section:
…
prescribed information provider means a person who carries on a business of providing information and, without limiting the generality of the foregoing, includes:
(a) the holder of a licence granted under the Broadcasting Services Act 1992; and
(aa) a person who is the provider of a broadcasting service under a class licence under that Act; and
(ab) the holder of a licence continued in force by subsection 5(1) of the Broadcasting Services (Transitional Provisions and Consequential Amendments) Act 1992; and
(b) the Australian Broadcasting Corporation; and
(c) the Special Broadcasting Service Corporation.
relevant goods or services, in relation to a prescribed information provider, means goods or services of a kind supplied by the prescribed information provider or, where the prescribed information provider is a body corporate, by a body corporate that is related to the prescribed information provider;
…
Statutory framework – The Fair Trading Acts 1987 of Western Australia and New South Wales
29 The provisions set out above from the TPA are replicated in the Fair Trading Acts of Western Australia and New South Wales. Those Fair Trading Acts apply to all persons natural and corporate. They are not confined in their application as the Commonwealth Act is by the heads of constitutional power under which it is made. The equivalents to ss 52, 65A and 75B of the TPA in the Fair Trading Act (WA) are ss 10, 63 and 68. In the Fair Trading Act (NSW)they are ss 42, 60 and 61.
How deep is the media safe harbour
30 Section 65A of the TPA was enacted in 1984 as a response to concerns that news media could be liable for incorrect news reports under the misleading or deceptive conduct provisions of the TPA. This followed the decisions of the Full Court of the Federal Court in Universal Telecasters (Qld) Ltd v Guthrie (1978) 32 FLR 360; Universal Telecasters (Qld) Ltd v Ainsworth Consolidated Industries Ltd (1983) ATPR 40-384 and Global Sportsman Pty Ltd v Mirror Newspapers Pty Ltd (1984) 2 FCR 82. In Australian Ocean Line Pty Ltd v West Australian Newspapers Ltd (1983) 66 FLR 453, Toohey J refused to dismiss proceedings against the newspaper for misleading or deceptive conduct in relation to a story it carried about services and conditions aboard a cruise ship, The Dalamacija. Subsequently he made an award of damages against the newspaper: Australian Ocean Line Pty Ltd v West Australian Newspapers Ltd (1985) 58 ALR 549.
31 In the Second Reading Speech for the Statute Law (Miscellaneous Provisions) Bill (No 2) 1984 which introduced the proposed new s 65A, the then Attorney General said:
A new section 65A is to be inserted in the Trade Practices Act 1974 to clarify the application of certain of the consumer protection provisions of that Act to the Media and the other persons who carry on business of providing information.
Recent decisions of the Federal Court have suggested that a newspaper publisher may be taken to have engaged in conduct that is misleading or deceptive for the purposes of section 52 of the Trade Practices Act if the newspaper contains inaccurate information.
And further:
New s 65A will operate to exempt the media and (other persons who engage in businesses of providing information) from the operation of those provisions of Division 1 of Part V of the Trade Practices Act which could inhibit activities relating to the provision of news and other information.
Importantly, the exemption did not extend to the provision of information where information provided had what might be regarded as a commercial interest in the content of the information. So it was said:
In such cases, information providers must take the same responsibility for the accuracy of information as any other person who publishes information in trade or commerce. This can occur, for example, where a newspaper has agreed to publish a ‘news’ item about a product in exchange for the product supplier taking out paid advertising in that publication.
No doubt so called “advertorial” content would, on that basis, fall outside the intended limits of the exemption.
32 Section 65A provides an exemption from the application of s 52. That is to say, conduct which would otherwise contravene s 52 does not do so if it is conduct to which s 65A applies. The section provides no exemption for a media organisation which is an accessory to a contravention which is not covered by s 65A. So, if a news organisation aids, abets or induces somebody who is not covered by s 65A to make statements in trade or commerce which are misleading or deceptive and contravene s 52 or one of the State Fair Trading Acts, then the news organisation may be “involved in” that contravention within the meaning of s 75B of the TPA or its equivalent under the relevant Fair Trading Act. That is not to say that a newspaper or other media outlet would be held liable simply for reporting the fact of a statement by a third party which is of itself misleading or deceptive. It is not necessary to consider the conditions of accessorial liability in such a case because that is not the case now before the Court. The proposition remains that there is no protection in s 65A or its Fair Trading Act equivalents against accessorial liability for misleading or deceptive conduct: Advanced Hair Studio Pty Ltd v TVW Enterprises Ltd (1987) 18 FCR 1.
33 Section 65A exempts from the application of s 52 “a prescribed publication of matter by a prescribed information provider”. The party claiming the exemption must be a prescribed information provider. This means a person “who carries on a business of providing information”. The term includes but is not limited to licence holders under the Broadcasting Services Act 1992 or who provide broadcasting services under a class licence under that Act. The word “information” is not defined. Its ordinary meaning relevantly includes “knowledge or facts communicated about a particular subject, event etc.; intelligence, news”. It also extends to “an item of news”: Shorter Oxford English Dictionary (5th ed, Oxford University Press, 2002).
34 There are no doubt many activities which could involve carrying on a business of providing information. Many, if not mostprofessions and trades which involve the provision of information would no doubt be covered. The limitations on the application of s 65A are not to be found in the definition of prescribed information provider, but rather in subs 65A(1)(a) and (b).
35 The term “freelance journalist” is not explained in the statement of claim. It may be taken to include a person who writes articles for publication in media outlets on the basis that he or she will be paid for articles so published by the relevant media organisation. A freelance journalist is necessarily a person working on his or her own account and not as an employee of a particular media organisation. A person who carries on business as a freelance journalist is plainly within the class of persons described in s 65A as a “prescribed information provider”: see Carlovers Carwash Ltd v Sahathevan [2000] NSWSC 947 at [36] (Levine J).
36 In written submissions filed on behalf of Mr Bond and Lesotho Diamond it was argued that “chequebook journalism” is not covered by the s 65A exemption. “Chequebook journalism” is not a term of any statutory significance. It is generally used to describe the practice of media organisations paying non-journalists who happen to have undergone particular experiences to tell the story of their experiences exclusively to the paying organisation for publication by it. So a person who has been involved in some notorious or tragic event or scandal may make himself or herself available, for a fee, to be interviewed exclusively by a particular media organisation who may then publish the interview or a story based upon it. It can be said that selling the story amounts to providing information. That does not however constitute “carrying on the business of providing information”. Payment to freelance journalists cannot be equated with the practice of chequebook journalism.
37 The exemption under s 65A applies only to a “prescribed publication of matter”. That is a publication by the prescribed information provider “in the course of carrying on a business of providing information”. There is a question whether the transmission by a freelance journalist to a media outlet of an article for publication itself constitutes publication.
38 The ordinary meaning of the verb “publish” includes the following:
5a Of an author, publisher, etc.: prepare and issue (a book, newspaper, report, piece of music, etc.) for sale to the public. Also, prepare and issue the work of (an author, composer, etc). b Make (a work, information, etc.) generally accessible or available; place before the public; spec make (news, data, research findings, etc.) generally available through the medium of a newspaper, book, journal, etc.
Shorter Oxford English Dictionary (5th ed, 2002)
Consistently with the definition of “publish” the ordinary meaning of the word “publication” involves the concept of dissemination to the public.
39 Counsel for Mr Bond and Lesotho Diamond submitted that in relation to copyright law “publishing” and “publication” are “fundamental expressions meaning making available to the public” and that “it would take a great deal of contextual constraint to force them into a narrower and special meaning”: Infabrics Ltd v Jaytex Ltd [1981] 1 All ER 1057 at 1061. It was argued that, because s 65A exempts those who fall within it from, amongst other things, the consequences of misleading or deceptive conduct, there is no reason why the Court should adopt an expansive interpretation of the word “publication”. It should be interpreted in accordance with its ordinary natural meaning. In my opinion, however, the ordinary and natural meaning of “publication” includes transmission of a news article to a media organisation for publication to the world at large.
40 Where more than one construction is open on the statute, that construction should be adopted which is consistent with its purpose. The purpose of s 65A was clearly stated in the Second Reading Speech. To exclude from the exemption the supply of information by freelance journalists to media organisations is to partially defeat that purpose. The communication of news articles to media organisations by freelance journalists is so plainly within the intended purpose of the section that a construction covering it should be adopted provided that construction is open. In my opinion, as stated above, such communication is within the natural and ordinary meaning of publication as publication to the world at large. And even if transmission of an article by a freelance journalist to the editor of a media organisation were to be construed as merely one-to-one communication, the concept of such communication as publication is familiar in the area of defamation law. In Webb v Bloch (1928) 41 CLR 331 Isaacs J said (at 363):
To publish a libel is to convey by some means to the mind of another the defamatory sense embodied in the vehicle.
In Krahe v Freeman (1988) ATPR 40-871 at 49,430, Rogers J, in a passage cited with approval by Levine J in Carlovers [2000] NSWSC 947 at [44], said:
… the Fair Trading Act was never meant to be a substitute for actions for defamation. The Parliament has made that clear by the enactment of s 60. In my respectful view, the Court, should be astute not to allow utilisation for a purpose for which it was never intended.
41 The question remains whether a freelance journalist who supplies a news article to a media organisation under a contract to do so is excluded from the exemption in s 65A. It was submitted on behalf of Mr Bond and Lesotho Diamond that, in such a case, it is “strongly arguable” that the publication by the journalist is “… in connection with … the supply … of goods or services … where the publication was made … pursuant to a contract … with a person who supplies goods or services of that kind”: see s 65A(1)(a)(i) read with s 65A(1)(a)(vi)(A)). The argument runs that in such a case the freelance journalist supplies services, being “journalist services preparing newspaper articles or articles for inclusion in news services”. The argument was put thus (at [40]):
… it is strongly arguable that notwithstanding the general exemption afforded to ‘prescribed information providers’ from the provisions of s52 of the TPA (and related provisions) such providers (including freelance journalists) are nonetheless liable to an action for damages for misleading and deceptive conduct, where there is a contract, arrangement or understanding between such providers for the provision of the article. In colloquial terms, if the parties are engaged in ‘chequebook’ journalism then the promise of monetary reward for the provision of the article (or other publication) will remove that article from the immunity which might otherwise be conferred by Section 65A of the Act.
42 In my opinion the transmission by a freelance journalist of a news article to a newspaper or other media outlet with whom he or she has a contract to supply such services, is not a publication of matter “in connection” with the supply of such services. The exclusion of publications “in connection with … the supply or possible supply of goods or services” refers to a publication the content of which has some relationship to the supply of the goods or services in question. The provision of a journalistic service by transmission of an article about alleged corporate misdeeds is not a publication in connection with the supply of journalistic services. In my opinion this argument is untenable.
43 The publications which are protected by s 65A include the transmission of information or articles by freelance journalists to media organisations. Absent such coverage media organisations could be exposed to liability as accessories for publishing articles prepared for publication by freelance journalists in contravention of s 52 or the equivalent provision of the relevant Fair Trading Act. It would be a major and unintended gap in the coverage of the exemption and completely at odds with its purpose.
Whether the proceedings have a reasonable prospect of success
44 The contraventions of s 52 of the TPA and its equivalents in the Fair Trading Acts of Western Australia and New South Wales, as alleged in the amended statement of claim, are as follows:
1. A contravention of s 10 of the Fair Trading Act (WA) by Mr Barry “in writing the article for publication in the State of Western Australia” by Nationwide News [13].
2. A contravention of s 42 of the Fair Trading Act (NSW) by Mr Barry “in writing the article for publication in the State of New South Wales” by Nationwide News [14].
3. A contravention of s 52 of the TPA by Mr Barry “in writing the article [for] publication on the world wide [sic] web” [15].
4. A contravention of s 52 of the TPA by Mr Barry in “sending the article by e-mail” [16].
5. A contravention of s 52 of the TPA by Mr Breen in “sending the article by e-mail” [17].
The remaining allegations are of accessorial involvement by the other respondents.
45 The applicants’ case must stand or fall according to whether or not the conduct of Mr Barry and Mr Breen said to constitute misleading or deceptive conduct or conduct likely to mislead or deceive is covered by s 65A of the TPA or its equivalents in the Fair Trading Acts. For the reasons which I have outlined above, Mr Barry’s writing and transmission of the article to Mr Breen and thereby to companies in the News Group for publication, is covered by the exemption in s 65A. The alleged intra-group transmission of the article by Mr Breen is also, in my opinion, covered by the exemption. On the allegation made in the statement of claim he is an employee of a prescribed information provider and his transmission of the email is the conduct of that provider. To hold otherwise would result in absurd constraints upon the exemption provided and manifestly intended by s 65A.
46 The criterion of “no reasonable prospect of success” which is necessary to be satisfied for dismissal of a proceeding under s 31A does not require a demonstration that the proceeding is hopeless or bound to fail. Nevertheless, summary disposition under s 31A is to be approached with caution. The fact that an action shows little promise of success may not of itself be enough to justify dismissal particularly where that dismissal turns upon a proposition of law which while strong may yet be open to some debate. In my opinion, however, for the reasons which I have already outlined, there is no reasonable room for debate about the construction of s 65A that would leave room for Mr Bond and Lesotho Diamond to establish liability on the part of any of the respondents in this case. In my opinion the application has no reasonable prospect of success.
Conclusion
47 For the preceding reasons the application will be dismissed.
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I certify that the preceding forty-seven (47) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice French. |
Associate:
Dated: 21 September 2007
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Counsel for the Applicants: |
Mr ML Bennett |
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Solicitor for the Applicants: |
Lavan Legal |
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Counsel for the Respondents: |
Mr KJ Martin QC |
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Solicitor for the Respondents: |
Edwards Wallace |
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Date of Hearing: |
12 September 2007 |
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Date of Judgment: |
21 September 2007 |
