FEDERAL COURT OF AUSTRALIA

Rush v Nationwide News Pty Ltd (No 2) [2018] FCA 550

ORDERS

THE COURT ORDERS THAT:

1.    The amended interlocutory application filed by the First and Second Respondents seeking leave to file a further amended defence in the form annexed to that application is dismissed.

2.    The First and Second Respondents be granted leave to file a further amended defence strictly in the form annexed to the interlocutory application as originally filed on 3 April 2018.

3.    The amended interlocutory application filed by the First and Second Respondents seeking leave to file a cross-claim in the form annexed to that application pursuant to r 15.05(1) of the Federal Court Rules 2011 (Cth) is dismissed.

4.    The First and Second Respondents pay the Applicant’s costs of and associated with the amended interlocutory applications.

5.    If the First and Second Respondents file a further amended defence in accordance with the leave granted in order 2, the First and Second Respondents pay the Applicant’s costs thrown away as a result of the filing of the further amended defence.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

WIGNEY J:

1    Mr Geoffrey Rush has commenced defamation proceedings against Nationwide News Pty Ltd and Mr Jonathon Moran. Like many applicants in defamation proceedings, he is anxious to have his claim dealt with quickly so that, if successful, he may be publicly vindicated while the offending publications are still fresh in the mind of the public. He has made that clear from the outset. Perhaps more significantly, like any litigant in this Court, be they an asylum seeker, a Minister of the Crown, a regulatory body, a large media corporation or any ordinary Australian citizen, he is entitled to expect that his claim will be resolved as quickly, inexpensively and efficiently as possible. Regrettably, the approach that Nationwide and Mr Moran have taken to their defence of Mr Rush’s claim threatens to stymie or frustrate the achievement of that overarching objective of the Court’s civil practice and procedure.

2    It would not be unfair to say, in all the circumstances, that while Nationwide and Mr Moran were quick to publish, they have been slow to defend.

3    There are before the Court two interlocutory applications. Both of them were filed by Nationwide and Mr Moran. In the first application, they sought leave to file a further amended defence. The proposed further amended defence was effectively Nationwide and Mr Moran’s fourth attempt at filing the defence that they wish to take to trial. In the second interlocutory application, Nationwide and Mr Moran sought leave to file a notice of cross-claim outside the time period prescribed in the Federal Court Rules 2011 (Cth). The cross-respondent named in the draft notice of cross-claim is the Sydney Theatre Company Limited (STC).

4    Mr Rush opposed both applications. In relation to the further amendments to the defence, he contended that the additional paragraphs sought to be included in the defence did not disclose any reasonable defence or other case appropriate to the nature of the pleading. He also submitted that the further amendments should be refused on discretionary grounds. Mr Rush opposed the grant of leave to file the cross-claim on a similar basis. He submitted that the proposed claim against the STC was, if not hopeless, then certainly weak. He also contended that there were strong discretionary reasons why, if Nationwide and Mr Moran want to sue the STC, they should do so in separate proceedings, rather than delaying these proceedings to his prejudice.

THE STORY SO FAR

5    Before giving detailed consideration to the arguments for and against permitting Nationwide and Mr Moran to further amend their defence and file the proposed cross-claim, it is necessary to briefly outline the course of the proceeding to date.

6    Mr Rush commenced this proceeding against Nationwide and Mr Moran by filing an originating application and statement of claim on 8 December 2017. The nature of Mr Rush’s pleaded claim against Nationwide and Mr Moran was explained in detail in Rush v Nationwide News [2018] FCA 357 (Rush v Nationwide No. 1). These reasons presume familiarity with that judgment. It is sufficient for present purposes to note that the alleged defamatory statements were published on 30 November and 1 December 2017. Mr Rush therefore commenced the proceedings very soon after the publications.

7    Nationwide and Mr Moran filed their defence on 1 February 2018. That was just outside the time period prescribed in the Rules for the filing of a defence, though Mr Rush took no issue with that slight delay. On the day following the filing of the defence, Mr Rush sought further particulars of aspects of the defence and, more significantly, filed an interlocutory application which sought, amongst other things, to strike out the defence. That interlocutory application was made returnable at the first case management hearing on 8 February 2018.

8    Mr Rush moved on his interlocutory application at the first case management hearing. Nationwide and Mr Moran, however, opposed that course. They said that they were not ready for the hearing. They applied for an adjournment to allow them to file an amended defence. In doing so, they effectively acknowledged that their filed defence did not include adequate or sufficient particulars of some of their pleaded defences, including the defence of justification pursuant to s 25 of the Defamation Act 2005 (NSW) and the defence of qualified privilege pursuant to s 30 of the Defamation Act. No explanation was proffered for the filing of what was effectively conceded to be a deficient defence. It should also be noted that Nationwide and Mr Moran had not fully answered Mr Rush’s request for further particulars by this time. In the circumstances, Mr Rush’s interlocutory application to strike out the defence was adjourned and listed for hearing on 19 February 2018.

9    Nationwide and Mr Moran filed an amended defence on 15 February 2018. They also filed and served a subpoena on the STC. As will be seen, Nationwide and Mr Moran’s desire to obtain documents from the STC, which they no doubt hope will assist them in their defence of Mr Rush’s claim, appears to lie at the very heart of their continuing attempts to include certain factual allegations in their defence and their late attempt to file a cross-claim against the STC.

10    On 19 February 2018, Mr Rush moved on his application to strike out the defence. He was wholly successful, other than in respect of his attempt to maintain the confidentiality of parts of Nationwide and Mr Moran’s defence. In Rush v Nationwide No. 1, which was handed down on 20 March 2018, the Court struck out Nationwide and Mr Moran’s defence of justification, struck out certain paragraphs relating to the defence of qualified privilege that had been inserted in the amended defence and set aside the subpoena to the STC.

11    When the judgment in Rush v Nationwide No. 1 was handed down, Mr Rush sought orders which would progress the matter towards an early hearing of the substantive trial. Those orders were opposed by Nationwide and Mr Moran on the basis that they needed time to review the judgment for the purpose of deciding whether or not to seek leave to appeal. The matter was listed for a further case management hearing on 27 March 2018.

12    At the case management hearing on 27 March 2018, Nationwide and Mr Moran notified the Court, for the first time, that they proposed to seek leave to file a cross-claim for contribution against the STC as a joint or concurrent tortfeasor in respect of the alleged defamation. They did not at that time, however, have a draft of the proposed cross-claim. Nationwide and Mr Moran also notified the Court of their intention to seek leave to file a further amended defence and an application for leave to appeal in relation to the order striking out some paragraphs of their pleaded defence of qualified privilege. They did not propose to seek leave to appeal the orders striking out their justification defence. Despite those notifications, Mr Rush again sought procedural orders to progress the matter. The orders proposed by Mr Rush were again opposed by Nationwide and Mr Moran. Orders were made requiring Nationwide and Mr Moran to file their application for leave to file the further amended defence and cross-claim, and their application for leave to appeal, by 3 April 2018. The matter was listed for a further case management hearing on 9 April 2018.

13    Nationwide and Mr Moran filed their interlocutory applications and the application for leave to appeal on 3 April 2018. It is worth noting, at this stage, that the proposed further amended defence that was annexed to Nationwide and Mr Moran’s interlocutory application seeking leave to amend appeared to be fairly uncontroversial. It essentially gave effect to the strike out orders which had been made, and remedied some other aspects of the defence that had been the subject of criticism in Rush v Nationwide No. 1.

14    At the case management hearing on 9 April 2018, Mr Rush advised the Court that he opposed the filing of the cross-claim against the STC, but did not oppose the filing of the proposed further amended defence. Nationwide and Mr Moran, however, said that they did not want their application for leave to amend dealt with straight away. That was because they were giving consideration to making further changes to the proposed further amended defence. The effect of the foreshadowed changes to the proposed further amended defence was said to be to include particulars of further facts and circumstances that were relevant to the question of mitigation of damages. As will be seen, those additional particulars turned out to include what were, in substance, the same paragraphs of the qualified privilege defence that had been struck out in Rush v Nationwide No. 1. In response, Mr Rush applied to have the interlocutory applications filed by Nationwide and Mr Moran heard at the earliest opportunity. That application was granted and the interlocutory applications were listed for hearing on 13 April 2018. As events transpired, however, they were not able to be heard until 16 April 2018.

15    On 12 April 2018, Nationwide and Mr Moran served amended interlocutory applications. Those amended interlocutory applications annexed amended versions of both the proposed further amended defence and the proposed cross-claim. The changes to both documents were substantial and significant. It should also perhaps be noted that Nationwide and Mr Moran had not given either the Court or Mr Rush forewarning that they were going to make changes to the proposed cross-claim.

The proposed further amended defence

16    As noted earlier, the original version of the proposed further amended defence was uncontroversial. Mr Rush did not oppose the grant of leave to file it. The proposed further amended defence which was ultimately the subject of Nationwide and Mr Moran’s leave application makes two substantive and substantial additions to the defence. Both of them are controversial.

17    The first addition is to effectively reintroduce paragraphs of the qualified privilege defence that were struck out in Rush v Nationwide No. 1, but as particulars of facts and matters said to be relevant to the mitigation of damages, rather than as particulars of the defence of qualified privilege. Paragraph 37 of the proposed further amended defence, including underlining denoting the proposed new paragraphs, and strike-through denoting proposed deletions, is in the following terms:

If (which is denied) the Applicant suffered any damage as a result of the publication of the matters complained of and/or the imputations pleaded in paragraphs 4, 5, 7, 8, 10 and 11 of the Statement of Claim, then the Respondents intend to rely upon the following facts and matters in mitigation of such damage:

(a)     the substantial truth of the imputations in sub-paragraphs 4(a), 47(d), 8(d), 10(d), 10(f), 11(d) and 11(f) of the Statement of Claim (or so many of them as are established by the Respondents to be substantially true);

(b)    the facts, matters and circumstances proven in evidence in support of the defences pleaded in this Defence;

(c)    the circumstances in which it is proved the matters complained of were published;

(d)    the background context to which (ba) to (c) above comprised.

(e)    the relevant background facts in the context of which the matters complained of were published, namely:

(i)    In around 2015, the Applicant began rehearsals for the Sydney Theatre Company Limited’s (Sydney Theatre Company) production of the play “King Lear”, in which the Applicant played the role of King Lear (the Production).

(ii)    The role of King Lear’s daughter, Cordelia, in the Production was played by Eryn Jean Norvill (the Complainant).

(iii)    In the period between around 24 November 2015 and 9 January 2016, the Production was performed at the Sydney Theatre Company.

(iv)    that the Applicant had been accused of ‘inappropriate behaviour’ during the Sydney Theatre Company’s production of King Lear;

(v)    that the Sydney Theatre Company had told the Respondents that it “received a complaint alleging that Mr Geoffrey Rush had engaged in inappropriate behaviour. The company received the complaint when Mr Rush’s engagement with the company had ended. The company continues to work with the complainant to minimise the risk of future instances of the alleged behaviour occurring in its workplace. The complainant has requested that their identity be withheld. STC respects that request and for privacy reasons, will not be making any further comments”;

(f)    that:

(i)    on around 1 April 2016, the Complainant contacted Ms Rachael Azzopardi (the Sydney Theatre Company’s Director of Programming and Artistic Operations) and asked to arrange a meeting between the two of them;

(ii)    on around 4 April 2016, the Complainant met with Ms Azzopardi and told Ms Azzopardi about the Applicant’s conduct towards her during the Production, that is, she made the Complaint;

(iii)    on around 14 April 2016, a meeting was held between the Complainant, the Complainant’s agent, Lisa Mann, the HR Manager of the Sydney Theatre Company, Kate Crisp, and another employee of the Sydney Theatre Company whose identity is presently unknown to the Respondents. At that meeting the Complainant made a complaint about the Applicant’s conduct towards her during the Production;

(iv)    the substance of the Complaint at that meeting was that the Applicant had groped the Complainant “all over” during the Production.

(v)    the Complainant stated at the meeting referred to in paragraph (iii) that the main reason for her deciding to report the Applicant’s conduct was to bring the matter to the attention to [sic] the Sydney Theatre Company in order to minimise the possibility of such an experience occurring again. The Complainant also advised the Sydney Theatre Company that she did not want the Applicant to be informed of the Complaint for fear of repercussions against the Complainant;

(g)    that two Sydney Theatre Company actors had spoken out in support of the Complainant, namely:

(i)    Meyne Raoul Wyatt, an actor who also appeared in King Lear, had said he believed the allegations concerning the Applicant and had posted the following statement of [sic] his Facebook page: “I was in the show. I believe whoever has come forward. It’s time for Sydney Theatre Company and the industry in Australia and worldwide as a whole to make a stand on this behaviour!!!”;

(ii)    Brandon McClelland, an actor who has worked alongside the Complainant, who posted the following statement on his Twitter account: “It wasn’t a misunderstanding. It wasn’t a joke”;

(h)    that Brandon McClelland’s tweet had been reposted by several other Sydney theatre actors;

(i)    that two sources from the Sydney Theatre Company had said that the Sydney Theatre Company stood by the Complainant’s claims;

(j)    that the two sources referred to in the preceding particular had both said that the Sydney Theatre Company would not work with the Applicant again, with one saying: “There is no chance. How could we work with him again? That question doesn’t even need an answer. Another actor backed what she said … we’ve taken this very seriously”;

(k)    that the source referred to in the preceding particular had also defended not naming the Complainant, saying “It is not our story to tell”;

(l)    that the Applicant had been told the identity of the Complainant in a telephone call with Sydney Theatre Company’s Executive Director, Patrick McIntyre, two weeks earlier;

(m)    that the Sydney Theatre Company had revised its HR policies to try to ensure it maintained a safe environment for staff;

(n)    that Patrick McIntyre, the Executive Director of the Sydney Theatre Company had stated the following:

(i)    it was important actors felt safe to speak up and that he believed maintenance of confidentiality was key;

(ii)    the Sydney Theatre Company had “reviewed policies and procedures in place and that includes educating actors when they come in to the company about our intolerance of inappropriate behaviour, who they should speak to and encouraging them to speak up”;

(iii)    the executive team at the Sydney Theatre Company had a duty of care to ensure all staff feel safe and respected in the workplace;

(iv)    “This isn’t about creating drama and blame but if everyone holds each other accountable, we create the kind of workplace we all want to be in”;

(v)    it was a wide ranging issue for the industry to address in the wake of the Harvey Weinstein scandal;

(vi)    “Many still view that speaking up comes with adverse repercussions. This is a trust issue that the industry needs to work towards resolving and the observance of confidentiality is key to this. If people don’t trust us with their stories, they won’t speak up”

(o)    that an Actors Equity survey aimed at theatre actors had preliminary findings that 40% of respondents claimed they had directly experienced sexual harassment, bullying or misconduct;

(p)    that the Sydney Theatre Company had stated the following:

(i)    it “was asked by a News Ltd journalist earlier this month whether it had received a complaint alleging inappropriate behaviour by Mr Rush while he was employed by the company. STC responded truthfully that it had received such a complaint”;

(ii)    the Complainant had “requested the matter be dealt with confidentially, and did not want Mr Rush notified or involved” in any inquiry;

(iii)    “STC complied, acting in the interest of the complainant’s health and welfare. As already stated, the Company received the Complaint after Mr Rush’s engagement had ended”;

(q)    the Applicant had worked with the Sydney Theatre Company both acting and directing productions including Uncle Vanya, Oleanna, The Importance of Being Ernest and The Government Inspector;

(r)    the fact that the Applicant is one of Australia’s biggest film and theatre stars.

18    Nationwide and Mr Moran justified the re-insertion of the previously struck out paragraphs as particulars of facts relevant to the mitigation of damages on the basis of the so-called Burstein principle: Burstein v Times Newspapers Ltd [2001] 1 WLR 579. The scope and operation of the Burstein principle is considered later in these reasons. Suffice it to say at this stage that Nationwide and Mr Moran contended that the facts set out in paragraph 37 of the proposed further amended defence fall within the Burstein principle. That was said to be because the facts were “closely connected with the core of the matters complained of, namely the complaint by a complainant about inappropriate behaviour by [Mr Rush] towards her”. They were therefore, in Nationwide and Mr Moran’s submission, relevant to Mr Rush’s reputation and the damages properly payable to him should he succeed in proving that he was defamed.

19    Mr Rush contended that the facts in paragraph 37 of the proposed further amended defence do not fall within the Burstein principle. That was because they do not involve any actual conduct by him. Rather, at their highest, the facts concern nothing more than allegation or suspicion or, worse still, rumour and innuendo. The essence of the defamatory imputations pleaded by Mr Rush is that he was in fact guilty of engaging in inappropriate behaviour. In Mr Rush’s submission, there was no rational basis on which proof of mere suspicion, allegation or rumour could diminish the harm caused by a defamatory imputation of actual guilt. The facts were therefore not relevant to the mitigation of damages.

20    The second substantive addition to the proposed further amended defence was to reintroduce parts of the paragraphs previously struck out as particulars of the pleaded qualified privilege defence. The only basis upon which it was said to be appropriate to reintroduce those paragraphs was that, if they were permitted to be included as facts relevant to the mitigation of damages, then as a matter of discretion they should be permitted to be included in the defence as particulars of the qualified privilege defence. It was suggested by Nationwide and Mr Moran that this would then avoid the need for them to pursue their application for leave to appeal.

21    Mr Rush, on the other hand, contended that the paragraphs should not be permitted to be reintroduced because none of the defects with the paragraphs identified in Rush v Nationwide No. 1 had been cured. In Mr Rush’s submission, if the facts were permitted to be included elsewhere in the pleading, that was beside the point and no reason to allow them to be inserted in a part of the pleading where their presence was not justified.

22    In relation to discretionary considerations, Nationwide and Mr Moran relied on evidence from their solicitor, Mr Nicholas Perkins. Mr Perkins’ explanation for the late proposal to include “Burstein particulars” in the further amended defence was that “it had not been suggested prior to new counsel for the respondents being briefed in the matter”.

23    Mr Rush contended, however, that the obvious purpose of the proposed further amendments to the defence was to include sufficient facts to justify the reissue of the subpoena to the STC. That was, in Mr Rush’s submission, the only rational inference that could explain why Nationwide and Mr Moran were pressing so hard to reintroduce in the defence facts that were plainly irrelevant and had previously been struck out.

24    Mr Rush also relied on evidence from his solicitor, Mr Nicholas Pullen. The effect of Mr Pullen’s evidence was that, since the relevant publications, Mr Rush has continued to suffer “tremendous emotional and social hardship”. The nature of that hardship was explained in some detail. Mr Pullen exhibited to his affidavit a very large bundle of articles published in media and other outlets throughout the world concerning Mr Rush, many of which linked him with the so-called “#MeToo” movement.

Relevant principles – leave to amend

25    The power of the Court to grant or refuse leave to amend under rr 8.21 and 16.51 of the Rules must be exercised in the way that best promotes the Court’s overarching purpose to facilitate the just resolution of disputes according to law as quickly, inexpensively and efficiently as possible: s 37M(3) of the Federal Court of Australia Act 1976 (Cth); Caason Investments Pty Ltd v Cao (2015) 236 FCR 322 at 326 [19] and the cases there cited. The Court’s power to grant leave to amend is broad and has the remedial objective of ensuring that any defect in the pleadings is cured and that the real questions in the controversy are properly agitated: Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 at 185 [14]; Caason Investments at 327 [20]. The object of the Court is not to punish parties for mistakes made in the course of their case, but to correct errors with the result that a decision can be made on the real matters in controversy: Clough v Frog (1974) 4 ALR 615 at 618; (1974) 48 ALJR 481 at 482; Caason Investments at 327 [20].

26    Leave to amend should be granted unless the proposed amendment is futile, such that the issue sought to be raised by the amendment has no reasonable prospects of success, or would be liable to be struck out as not raising a reasonable cause of action, or where the amendment would cause substantial prejudice or injustice to the opposing party in a way that cannot be compensated by the award of costs: Research in Motion Ltd v Samsung Electronics Australia Pty Ltd (2009) 176 FCR 66 at 69-70 [21]-[22]; Medich v Bentley-Smythe Pty Ltd [2010] FCA 494 at [8]; Caason Investments at 327 [21].

27    There are limits to be placed upon re-pleading. An amendment application should not be approached on the basis that a party is entitled to raise an arguable claim or defence subject to the payment of costs by way of compensation: Aon at 217 [111]. An order for costs may not always provide sufficient compensation and, therefore, achieve a just resolution. Parties are also entitled to expect that litigation be resolved with reasonable despatch: Richards v Cornford (No 3) [2010] NSWCA 134 at [44].

28    In Tamaya Resources Ltd (in liq) v Deloitte Touche Tohmatsu (A Firm), in the matter of Tamaya Resources Ltd (in liq) [2015] FCA 1098, Gleeson J provided a useful summary of the types of matters that the Court should consider in exercising its discretion whether or not to grant leave to amend (at [127]):

The principles articulated by the High Court in Aon apply to matters in this Court: Cement Australia Pty Ltd v Australian Competition and Consumer Commission [2010] FCAFC 101; (2010) 187 FCR 261 at [43]. Relevant matters the Court is to consider include:

•    The nature and importance of the amendment to the party applying for it: Aon at [102];

•    The extent of the delay and the costs associated with the amendment: Aon at [102];

•    The prejudice that might be assumed to follow from the amendment, and that which is shown: Aon at [5], [100] and [102];

•    The explanation for any delay in applying for that leave: Aon at [108]; and

•    The parties’ choices to date in the litigation and the consequences of those choices: Aon at [112] and Luck v Chief Executive Officer of Centrelink [2015] FCAFC 75 (“Luck“) at [44];

•    The detriment to other litigants in the Court: Aon at [93], [95] and [114] and Luck at [44]; and

•    Potential loss of public confidence in the legal system which can arise where a court is seen to accede to applications made without adequate explanation or justification: Aon at [5], [24] and [30].

29    Gleeson J did not suggest that this list was exhaustive, or that each of the matters in the list would necessarily be material in every case. At [128], her Honour noted that the weight to be given to those considerations, individually and in combination, and the outcome of the balancing process generally, may vary depending on the particular facts of the case.

30    The onus is on the party seeking leave to amend to persuade the Court that such leave should be given: Dye v Commonwealth Securities Limited (No 2) [2010] FCAFC 118 at [17].

SHOULD LEAVE TO FILE THE FURTHER AMENDED DEFENCE BE GRANTED?

31    It would be appropriate to permit Nationwide and Mr Moran to file a further amended defence in the form attached to the interlocutory application as originally filed on 3 April 2018. Mr Rush did not oppose the filing of the further amended defence in that form. Leave to file the further amended defence in the form annexed to the amended interlocutory application, however, is not appropriate and should be refused. That is so for three reasons. First, the inclusion of the facts in paragraphs 37(e) to 37(r) is not justified by Burstein or any of the cases that have followed or applied the principles that flow from it. The facts in those paragraphs are not, on any view, relevant to the mitigation of damages. Second, there is no proper basis for the reinsertion of the paragraphs previously struck out of the defence of qualified privilege. No attempt was made to demonstrate how those facts are relevant to the defence of qualified privilege. Third, there are significant discretionary considerations that tell against the grant of leave.

Mitigation of damages and the Burstein principle

32    In Warren v Random House Group Limited [2009] QB 600, the Court of Appeal of England and Wales explained the Burstein principle in the following terms (at [78]):

The decision of this court in Burstein v Times Newspapers Ltd [2001] 1 WLR 579, cited above, established two important interlocking propositions. (a) In relation to the court’s assessment of damages for libel it is open to a defendant to seek to rely upon such facts as fall within the “directly relevant background context” to the defamatory publication. See in particular the judgment of May LJ, at para 42. (b) It is illogical and undesirable that a defendant can seek to rely upon such facts in relation to such assessment only if he has presented them as part of a substantive defence to liability, in particular within a plea of justification of the publication. He can rely upon them as freestanding matters pleaded as relevant only to the assessment of damages: see in particular the judgment of May LJ, at para 47.

33    That rather simple statement of the propositions flowing from Burstein somewhat belies the uncertainty that has arisen concerning the application of those propositions. That uncertainty mainly revolves around the vague and unhelpful expression “directly relevant background context”. Judges are often rightly sceptical when the tender of evidence is sought to be justified on the basis that it provides “background” or “context”. Those words often conceal or obscure, rather than explain, whether or why the evidence is relevant. Careful attention to what was actually decided in Burstein, however, tends to remove some of the uncertainty.

34    In Burstein, the claimant claimed that a publication in “The Times” was defamatory of him because it stated that he “used to organise bands of hecklers to go about wrecking performances of modern atonal music”. He bought libel proceedings against the publisher. The publisher relied on a defence of fair comment, though the trial judge proceeded to strike out that defence. There was, therefore, “no effective issue but that the words complained of were defamatory”. In relation to the assessment of damages, the trial judge refused to allow the publisher to rely, in reduction of damages, on facts it had pleaded in support of its defence of fair comment. Those facts, the particulars of which are set out at [10] of the judgment of May LJ, all involved the claimant’s conduct as a co-founder of a “group of militant campaigners against modernist atonal music which styled itself ‘the Hecklers’”. The Court of Appeal of England and Wales found that the trial judge erred in excluding evidence of the particularised facts.

35    May LJ (at [19]) noted that the evidence which is properly admissible in reduction of damages for defamation includes evidence of the claimant’s bad reputation, evidence properly before the court on some other issue and evidence of the claimant’s own conduct. The admissibility of evidence of the claimant’s reputation centred, May LJ noted (at [20]) on the decision of the Queens Bench Divisional Court in Scott v Sampson (1882) 8 QBD 491. That case established that evidence of general bad reputation was admissible in reduction of damages, but that “evidence of rumours that the plaintiff had done what was charged in the libel and evidence of particular acts of misconduct on the part of the plaintiff tending to show his character and disposition were inadmissible”.

36    In relation to the second category of evidence, evidence properly before the court on some other issue, May LJ referred (at [21]) to Pamplin v Express Newspapers Ltd (Note) [1988] 1 WLR 116 in which Neill LJ stated:

But a defendant is also entitled to rely in mitigation of damages on any other evidence which is properly before the court and jury. This other evidence can include evidence which has been primarily directed to, for example, a plea of justification or fair comment … There may be many cases, however, where a defendant who puts forward a defence of justification will be unable to prove sufficient facts to establish the defence at common law and will also be unable to bring himself within the statutory extension of the defence contained in section 5 of the Defamation Act 1952. Nevertheless the defendant may be able to rely on such facts as he has proved to reduce the damages, perhaps almost to vanishing point. Thus a defence of partial justification, though it may not prevent the plaintiff from succeeding on the issue of liability, may be of great importance on the issue of damages.

37    This “apparently straightforward state of law and practice” had, according to May LJ, led to “unsatisfactory tactical manoeuvring” (at [22]). In short, defendants had pleaded weak cases of justification so as to be able to use the facts pleaded in support of that unsuccessful defence in reduction of damages.

38    May LJ referred at length (at [29]-[34]) to Speidel v Plato Films Ltd [1961] AC 1090, a case in which the House of Lords gave detailed consideration to Scott v Sampson. The House of Lords confirmed that evidence as to the “circumstances under which the alleged libel was published” was inadmissible and that evidence of particular acts on the part of the plaintiff could not be given in reduction of damages where the defendants had failed to justify the libel complained of. At [35], May LJ said:

I have quoted at length from the speeches in Speidel v Plato Films Ltd to show that a main concern was to prevent libel trials from becoming roving inquiries into the plaintiff’s reputation, character or disposition; that what was held to be inadmissible was particular facts said to be relevant to the plaintiff’s general reputation or disposition; and that the case does not decide that particular facts directly relevant to the context in which a defamatory publication came to be made are inadmissible. Indeed, two of the speeches by inference accept that evidence of the circumstances surrounding the publication are admissible.

39    To understand the reference, in that passage, to “facts directly relevant to the context in which a defamatory publication came to be made”, it is necessary to go back to the speech of Lord Denning in Speidel, which was one of the two speeches that May LJ was plainly referring to. In Speidel, Lord Denning had given an example of a publication that a man had been convicted six times for dishonesty, when in fact he had only been convicted twice. According to Lord Denning, in such a case, the defendant could adduce evidence of the two convictions “in partial justification” because, otherwise “the plaintiff would recover damages for a character which he did not possess or deserve; and this the law will not permit”.

40    It was in that context that May LJ said (at [42]):

In my view, permitting the defendants to rely on the directly relevant background context in the way in which I have described would not offend anything said in Scott v Sampson 8 QBD 491 or Speidel v Plato Films Ltd [1961] AC 1090. The material to which I have referred as directly relevant background context was, as I have indicated, recognised in Speidel v Plato Films Ltd as being admissible as the circumstances in which the publication came to be made. In the present case, those circumstances are not sensibly limited to the concert in memory of John Smith and the fact that the claimant’s music was played at it. For practical purposes, every publication has a contextual background, even if the publication is substantially untrue. In addition, the evidence which Scott v Sampson excludes is particular evidence of general reputation, character or disposition which is not directly connected with the subject matter of the defamatory publication. It does not exclude evidence of directly relevant background context. To the extent that evidence of this kind may also be characterised as evidence of the claimant’s reputation, it is admissible because it is directly relevant to the damage which he claims has been caused by the defamatory publication.

41    May LJ then referred to some authorities relevant to what had earlier been referred to as “unsatisfactory tactical manoeuvring” and said (at [47]):

In my view, these authorities show that it is not permissible to advance an unsustainable defence of justification and thereby, under the guise of particulars of justification, seek to rely on particulars which Scott v Sampson 8 QBD 491 and Speidel v Plato Films Ltd [1961] AC 1090 would not permit. That, however, does not prevent a defendant from frankly accepting that there is no proper plea of justification, but seeking to rely in reduction of damages on particulars which Scott v Sampson and Speidel v Plato Films Ltd do not exclude. If this were not so, there is a danger that the jury would be required to assess damages in blinkers, in ignorance of background context directly relevant to the damage which the claimant claims has been caused by the defamatory publication. This is consistent with the sense of what Lord Denning said in Speidel v Plato Films Ltd, where his conclusion was that it was permissible to adduce the evidence in question. Thus, in my view, a defendant is not prevented from taking the sensible course of accepting that the publication means what it says and that it is not on the facts justified, and yet putting in evidence directly relevant facts which in other circumstances might have been ingredients of a defence of justification. It would, I think, be illogical and unfair if this were not so. Evidence in support of a plea of justification which fails is admissible in reduction of damages. But the very same evidence would not be admissible to a sensible defendant who acknowledges that it will not support a plea of justification. What is not permissible is to plead a defence of partial justification which in truth is no defence at all.

42    It is tolerably clear, when paragraphs [42] and [47] of the judgment of May LJ are read in context, that the expression “directly relevant background context” is a reference to evidence of misconduct on the part of the claimant which, while not sufficient to make out a defence of justification, nevertheless was conduct which was in the same sector of the claimant’s life as the defamatory publication and was therefore directly relevant to his or her reputation. The example given by Lord Denning in Speidel is a classic example of such evidence. “Directly relevant background context” does not include rumours or mere allegations that the claimant had done what was charged in the libel. That type of evidence is properly excluded by what was said in Scott v Sampson. Nothing said by May LJ in Burstein suggested that Scott v Sampson did not continue to apply in the case of such evidence.

43    Notwithstanding this, the Burstein principle has been productive of some uncertainty, mainly because the expression “directly relevant background context”, if not properly considered and understood in context, is apt to obscure exactly what sort of evidence can be admitted pursuant to the principle. That point was made in Turner v News Group Newspapers Ltd [2006] 1 WLR 3469, where Keene LJ (with whom Moses LJ and Pill LJ agreed) said (at [56]):

I accept the point made in argument that it is somewhat repetitive to use the words “background” and “context” in the phrase “directly relevant background context”, but that in itself does not produce obscurity. It is in any event inevitable that cases will occur where it is not easy to determine whether the test in Burstein’s case is met or not. That does not mean that the test is an inappropriate one, any more than is that propounded in Scott v Sampson: as Viscount Simonds recognised in Speidel’s case, the line between evidence of general bad reputation and evidence of specific conduct giving rise to such a reputation is not easy to draw. What constitutes the directly relevant background will vary from case to case, but I would myself accept the need for the courts to proceed, as Mr Browne advocates, with some caution in applying Burstein’s case, given that it represents a modification of the long-standing rule in Scott v Sampson. As Eady J put it in Polanski v Condé Nast Publications Ltd (unreported) 21 October 2003, one should guard against extending too creatively the concept of “directly relevant background”. The Court of Appeal in Burstein’s case was concerned to avoid jurors having to assess damages while wearing blinkers. If evidence is to qualify under the principle spelt out in Burstein’s case, it has to be evidence which is so clearly relevant to the subject matter of the libel or to the claimant’s reputation or sensitivity in that part of his life that there would be a real risk of the jury assessing damages on a false basis if they were kept in ignorance of the facts to which the evidence relates.

44    Moses LJ explained the difficulties in the following way (at [87]-[90]):

The purpose of the approach taken by the Court of Appeal in Burstein’s case is clear; it was to ensure that the claimant was properly vindicated and fairly compensated. Exclusion of the facts identified by Sir Christopher Slade, at paras 59 and 60, would not have achieved that result. The problem, as in so many branches of the law, lies in the expressions used to identify and describe the principle deployed to admit that evidence. May LJ referred to “relevant background context”: para 41 or “background context directly relevant to damage”: para 47. Ever forgetful of the need not to read judgments as if they were statutes, the words “directly relevant background context” have been used as a label to be stuck on by a defendant or ripped off by a claimant. But the words themselves are no substitute for the reasoning of the court in Burstein’s case.

The difficulty may lie, I suggest, in the fact that the label, which it has been sought to apply in subsequent cases, does not itself greatly assist in identification. Once detached, it does not, pace Keene LJ at para 56, provide a test, since it assumes a meaning to the words of description it employs. To describe a fact as “directly relevant” has no meaning without identification of the issue to which it is alleged to be relevant. The word “context” may itself be misleading. It is accepted that, following Burstein’s case, facts may be admitted, notwithstanding that they did not themselves cause or provoke the publication of the defamatory material; that must follow from the decision in Burstein’s case itself. Further, there is no requirement that the facts should have been known to the publisher at the time of publication; there is no logic in such a requirement to achieve that which the principle seeks to achieve, a fair measure of damages. In those circumstances to ask whether the facts form part of the context in which the defamatory material was published does not seem to me to be of help to anyone save the lawyers who may gain much by endless debate as to what the label signifies. Nor does it assist to speak of the jury or judge being kept “in blinkers”, unless it is clear what is to be hidden from their eyes.

Keene LJ refers to “directly relevant background” and Sir Christopher Slade similarly refers to “directly relevant background facts”; the reference to “background” draws a distinction from those facts which relate directly to the defamatory words, which, ex hypothesi, after an offer of amends, cannot be used in justification or to deploy the defence of fair comment. After an offer of amends, only those facts which are directly relevant to the existence and extent of the alleged damage may be admitted, unless a claimant seeks to rebut the presumption in section 4(3) of the Defamation Act 1996. The key lies in identifying that which is directly relevant to the issue of damages. That lies, in my view, in recalling the reference by Cave J in Scott v Sampson to “uniform propriety” cited by Keene LJ at para 29. A claimant’s life may appropriately be considered in sectors: see Lord Denning in Speidel v Plato Films Ltd [1961] AC 1090, 1140 and Goody v Odhams Press Ltd [1967] 1 QB 333, 341a. A defendant may seek to reduce the damages by adducing evidence which is directly relevant to a claimant’s conduct or reputation in the particular sector to which the defamatory material relates for the purpose of mitigating damage.

Direct relevance to a particular sector of the claimant’s life should be assessed by starting with a careful identification of the sector of the claimant’s life to which the defamatory material relates; too broad an approach, such as his private life, will defeat the function of the reference to “direct relevance”. Further restriction may be achieved by scrutiny of the purpose for which it is sought to adduce the facts in issue. It should be recalled that the purpose of the rule in Scott v Sampson was by no means only a desire to keep a case within manageable proportion. The rule serves the important function of preventing a claimant from being terrorised into submission. It is worth recalling that, alongside its failed attempt to abrogate the rule in Scott v Sampson, the Neill Committee advised that a defendant making an offer of amends should not be permitted to attack a claimant’s character. Such an attack, once the rule had been abolished, should only be made before a jury: see the Supreme Court Committee Report on Practice and Procedure in Defamation (July 1991), p 79, para VII.28. But that advice has gone, along with the recommendation to abolish the rule.

45    Those passages from Turner support the proposition that the facts which are able to be pleaded and proved in the mitigation of damages pursuant to the Burstein principle must concern specific conduct that is directly relevant to either the subject matter of the alleged defamatory statement, or the claimant’s reputation in the part of his or her life the subject of the defamatory publication. The rationale for permitting evidence of such facts being led is that otherwise damages may be assessed on a false basis. It is equally clear that courts, including this Court, must proceed with caution in applying Burstein, should guard against “extending too creatively” the concept of “directly relevant background”, and should subject the proposal to adduce facts under the Burstein principle to careful scrutiny. Mere resort to the label “directly relevant background context” will not suffice.

46    The Burstein principle has been accepted in Australia: Australian Broadcasting Corporation v McBride (2001) 53 NSWLR 430; Channel Seven Sydney Pty Ltd v Mahommed (2010) 278 ALR 232 at [262]-[265]); Holt v TCN Channel Nine Pty Ltd (2014) 86 NSWLR 96; Gacic v John Fairfax Publications Pty Ltd (2015) 89 NSWLR 538; Coxon v Wilson [2016] WASCA 48; and, most recently, Fairfax Digital Australia & New Zealand Pty Ltd v Kazal [2017] NSWCA 77.

Are proposed paragraphs 37(e) to (r) proper Burstein particulars?

47    The short answer to this question is “no”. It is not reasonably arguable that evidence of the “facts” referred to in paragraphs 37(e) to (r) either fall within the Burstein principle or are otherwise relevant to the mitigation of damages. Granting leave to amend the defence to include the particulars in paragraphs 37(e) to (r) would be futile as those particulars would, in any event, properly be struck out.

48    The fundamental difficulty with the proposed Burstein particulars in paragraphs 37(e) to (r) is that they do not concern conduct of Mr Rush that is directly relevant to the alleged defamatory imputations, or to his reputation in that part of his life which was the subject of the defamatory imputations. The facts in some of the paragraphs, at their very highest, comprise nothing more than hearsay statements about allegations that had been made against Mr Rush. Other paragraphs plead facts which amount to little more than rumour or innuendo. Some of the paragraphs refer to facts which, on any view, having nothing whatsoever to do with Mr Rush’s conduct or reputation. None of the facts in the relevant paragraphs, if proved, could rationally diminish the harm to Mr Rush’s reputation from the alleged defamatory imputations.

49    Before addressing paragraphs 37(e) to (r) individually, it is important to emphasise one fundamental aspect of the imputations that Mr Rush contends were conveyed by the relevant publications. The imputations are, of course, addressed in considerable detail in Rush v Nationwide No. 1. The important point to emphasise is that all of the imputations comprise statements that Mr Rush was guilty of engaging in certain conduct (“scandalously inappropriate behaviour in the theatre”; “inappropriate behaviour of a sexual nature”; “sexual assault”; “behaved as a sexual predator”; “inappropriately touched an actress”) or statements that Mr Rush was a particular type of person (a “pervert”; a “sexual predator”). The imputations are not that Mr Rush was alleged to have engaged in that conduct, or that there were reasonable grounds to suspect that he engaged in that conduct, or that there were grounds to investigate whether that conduct had occurred: cf Chase v Newsgroup Newspapers Ltd [2002] EWCA Civ 1772 at [45]-[46]; Lewis v Daily Telegraph [1964] AC 234 at 283. Asserting that someone was guilty of certain conduct is, generally speaking, significantly different than simply asserting that there may be grounds to suspect that the person engaged in that conduct, or that it was alleged that the conduct had been engaged in.

50    It is, in those circumstances, difficult to see how facts which, at their highest, might establish that the STC had said that a complaint had been made against Mr Rush which alleged that he had engaged in “inappropriate behaviour”, or facts which suggested no more than that some people, who did not appear to know the details of the complaint, had said that they suspected that Mr Rush had engaged in such behaviour, could relevantly mitigate damages should it be found that Mr Rush was defamed by statements that contended that he was guilty of engaging in even more serious behaviour: “scandalously inappropriate behaviour” or “inappropriate behaviour of a sexual nature” etcetera. In any event, as will be seen, most, if not all, of the “facts” in paragraph 37(e) to (r) of the proposed amended defence do not even rise as high as establishing that Mr Rush was alleged to have engaged in such behaviour, or that there were reasonable grounds to suspect that he had. Rather, they comprise little more than hearsay statements, rumour or innuendo.

51    It should be noted, in this context, that Nationwide and Mr Moran relied on the decision of the Court of Appeal of the Supreme Court of Western Australia in West Australian Newspapers Ltd v Elliott [2008] WASCA 172; (2008) 250 ALR 363 as authority for the proposition that evidence that someone was reasonably suspected of having engaged in certain conduct can be admitted on the basis of the Burstein principle, even if the pleaded defamatory imputation was that the claimant had in fact engaged in that conduct. It is, however, readily apparent from the judgment of the Court of Appeal (at [64]), that the question whether such evidence was admissible on the basis of the Burstein principle was not fully addressed in the submissions. The court found no more than that it was arguable that evidence of what was called the “lesser imputation” would be admissible as directly relevant background context. The issue in Elliott also arose in the context of the so-called Polly Peck defence (Polly Peck (Holdings) Plc v Trelford [1986] QB 1000; [1986] 2 All ER 84), an issue which does not and cannot arise in this matter. In any event, lest there be any doubt about it, had the court found that evidence of the lesser imputation was admissible on the basis of the Burnstein principle, it would plainly have been wrong.

52    In their submissions, Nationwide and Mr Moran for the most part did not directly address the relevance of each of the individual subparagraphs in paragraph 37. That exercise is, however, necessary. When closely analysed, none of the individual paragraphs, considered alone, in combination or cumulatively, could reasonably be said to be relevant to the mitigation of damages should Mr Rush make out his case.

53    Paragraphs 37(e)(i), (ii) and (iii) are simply uncontentious facts about the STC’s production of King Lear. They do not involve conduct by Mr Rush and are incapable, by themselves, of mitigating damage.

54    Paragraphs 37(e)(iv) and (v) concern, respectively, an accusation made against Mr Rush, and the fact that the STC had told Nationwide and Mr Moran about that accusation; or more particularly that it had received a complaint alleging something against Mr Rush. They do not assert directly that Mr Rush had engaged in particular conduct. Rather, they rise no higher than that it was alleged that he had, or in the case of paragraph 37(e)(v), that the STC had told Nationwide and Mr Moran that such an allegation had been made. The fact that an unproven allegation had been made against Mr Rush, or that the STC had said that such an allegation had been made, could not rationally diminish the harm to Mr Rush’s reputation from the alleged defamatory imputations which assert guilt.

55    Paragraph 37(f) concerns meetings between “the Complainant” and employees of the STC, apparently held in private, on 1 and 4 April 2016, concerning the complaint that had been made against Mr Rush. The facts in paragraph 37(f) do not directly relate to conduct by Mr Rush, but instead involve hearsay statements by the complainant and others about the allegation, and other things apparently related in some way to it. It is not suggested that Mr Rush was at this meeting, or was aware of what was said at it, or knew anything about it. Words spoken at this meeting could not rationally diminish the harm to Mr Rush’s reputation from the alleged defamatory imputations which assert guilt, not mere suspicion or allegation.

56    Paragraphs 37(g) and (h) concern statements made on social media by two actors. There is nothing to suggest that either of the actors had any direct knowledge of any conduct of Mr Rush relevant to the complaint or otherwise. Those facts amount to nothing more than rumour and innuendo. Paragraphs 37(i), (j) and (k) are even further removed. They refer to statements by two unnamed sources who say nothing more than that the STC “stood by the Complainant’s claims”, whatever that means; that the STC would not work with Mr Rush again, and that they stood by the decision not to name the complainant. The facts in those paragraphs, if proved, could not rationally diminish the harm to Mr Rush’s reputation from the alleged defamatory imputations which, as has already been emphasised, assert guilt not suspicion. Facts concerning what unnamed sources said about their attitude to an allegation, which it is not even suggested they knew the precise details of, could scarcely be said to be directly relevant to Mr Rush’s reputation or conduct engaged in by him.

57    Paragraph 37(l) states no more than that Mr Rush had been told the identity of the complainant. How, it might be asked rhetorically, could that possibly rationally diminish the harm to Mr Rush’s reputation from the alleged defamatory imputations? The same can be said of paragraph 37(m), which is that the STC had changed its “HR” policies.

58    Paragraph 37(n) relates to statements made by Mr Patrick McIntyre of the STC about all manner of things, including: his view that it was important for actors to feel safe to “speak up”; that the STC had changed its policies; that the STC had certain duties; and that he or the STC held various views or opinions about issues for the “industry”. None of those statements directly concern the conduct of Mr Rush or anything else that could be said to relate to his reputation.

59    Paragraph 37(o) concerns an Actors Equity survey. Exactly how this could possibly mitigate damage was never explained by Nationwide and Mr Moran in their written or oral submissions. Yet they continued to maintain that the facts in paragraph 37 were “directly relevant background context”.

60    Paragraph 37(p) concerns further general statements made by the STC concerning the complaint. The relevance of such statements to the question of mitigation of damages has already been dealt with in detail. They are not relevant.

61    Paragraphs 37(q) and (r) can again be dealt with shortly. In one sense they relate to Mr Rush’s conduct and character. They are not contentious. If anything, however, they would tend to increase, not mitigate, damages if the defamatory imputations are found to have been conveyed.

62    Beyond asserting that paragraphs 37(e) to (r) were “directly relevant background context”, Nationwide and Mr Moran did not advance any submissions, either in writing or orally, explaining how any of those paragraphs could be said to fall within the Burstein principle, properly considered. Nor did they explain how the facts in those paragraphs could possibly be said to be directly relevant to Mr Rush’s reputation or conduct engaged in by him, or how they could rationally diminish the harm to Mr Rush’s reputation from the alleged defamatory imputations. For the reasons already given, the facts in those paragraphs are not proper Burstein particulars and could not, if proved, be relevant to the mitigation of damages.

63    The final point to note is that, in Kazal, Gleeson JA (with whom McColl and Meagher JJA agreed) noted that particulars of mitigation of damages can be struck out on the basis that they had a tendency to cause prejudice, embarrassment or delay in the proceedings. The court upheld the decision of the trial judge to strike out purported Burstein particulars on the basis that they were broad, lacked precision and were “an unhelpful exposition of the case to be put at trial”. The same description would apply to the particulars provided in paragraphs 37(e) to (r) of the proposed further amended defence. It is difficult to see how Mr Rush could comprehend, from the particulars, the case that he has to meet at trial in relation to the mitigation of damages. That difficulty was, and is, compounded by the fact that Nationwide and Mr Moran were unable to explain in their submissions exactly how those particulars were relevant to the mitigation of damages.

The reinsertion of the struck out particulars

64    The reasons for striking out certain paragraphs of Nationwide and Mr Moran’s qualified privilege defence were explained in detail in Rush v Nationwide No. 1. In summary, it was found that the paragraphs were not relevant to the pleaded defence of qualified privilege and were otherwise ambiguous or likely to be productive of delay and prejudice. Nationwide and Mr Moran have applied for leave to appeal from the orders striking out those paragraphs. That application has not yet been heard.

65    Despite the existence of the application for leave to appeal, Nationwide and Mr Moran want to amend their defence to reinsert those paragraphs, with minor alternations, in support of their qualified privilege defence. They sought to do so, not because they have remedied any of the deficiencies identified in Rush v Nationwide No. 1, but rather on the basis that if they were permitted to be included as facts relevant to the mitigation of damages they should also be permitted to be included in the defence as particulars of the qualified privilege defence.

66    That is, with respect, rather strange logic. It is, in a sense, the reverse of Burstein, which concerned the admissibility of evidence of facts not able to be led in support of a defence. Nationwide and Mr Moran appeared to contend that, if the facts are admitted on the basis that they are relevant to the mitigation of damages, it somehow follows that they are relevant to the defence of qualified privilege.

67    In any event, for the reasons already given, the paragraphs should not be permitted to be included in the defence as particulars of the mitigation of damages. It follows that the asserted basis for including the paragraphs in the pleading of the qualified privilege defence also falls away.

68    The inclusion of those paragraphs in the defence will, of course, need to be reconsidered if Nationwide and Mr Moran are successful in their appeal. In the meantime, however, Nationwide and Mr Moran should not be permitted to amend the defence to reinsert the struck out paragraphs.

Discretionary considerations

69    The delays that have been encountered thus far in this proceeding have already been considered. The version of the further amended defence that was the subject of Nationwide and Mr Moran’s amended interlocutory application was, in effect, their fourth attempt at settling a viable and satisfactory defence. That tortuous process alone has been productive of delay.

70    The only explanation given for the failure to include the supposed Burstein particulars in the earlier iterations of the defence was the explanation by Mr Perkins that the inclusion of those particulars had not been suggested prior to new counsel being briefed. That is hardly an acceptable explanation for the delay. If those particulars had been even remotely important to Nationwide and Mr Moran’s defence, it is difficult to see how existing counsel, who was and is highly regarded and experienced in defamation law, could have missed it. It should also be noted that, as the Full Court pointed out in Tamaya Resources Ltd v Deloitte Touche Tohmatsu [2016] FCAFC 2; (2016) 332 ALR 199 (at [155]), the explanation required is that of the party who applied for the amendment, not merely their solicitor or counsel. The client may know of matters relevant to the explanation for delay which are not known by the lawyers.

71    Despite, or perhaps irrespective, of what Mr Perkins said in his evidence, there are reasonable grounds to suspect that the real reason that Nationwide and Mr Moran have pressed for the inclusion of the previously struck out paragraphs of the defence, either in relation to the mitigation of damages or qualified privilege, is that if those paragraphs are included, they may then seek to re-agitate the subpoena to the STC in the hope that documents produced by the STC might allow it to re-plead a defence of justification. That inference flows from the conduct of the proceeding to date and, in particular, the zeal, if not desperation, which has been displayed by Nationwide and Mr Moran in pursuing what have been found to be impermissible inclusions in their defence. It is also supported by their late attempt to file a cross-claim against the STC, about which more will be said shortly. There could be little doubt that, if they were granted leave to file the further amended defence, in its final iteration, the next thing Nationwide and Mr Moran would have done would be to seek to have the STC subpoena reissued.

72    That is not to say that Mr Perkins had that purpose. He was not cross-examined on his evidence. Nor could it be (or was it) suggested that counsel for Nationwide and Mr Moran had that purpose. The question, however, is what the clients’ purpose was. Neither Mr Moran, or any relevant decision-maker from Nationwide, gave evidence in support of the amendment application. That is despite the fact that Mr Rush, through his counsel, had submitted, in forceful and at times colourful terms, that Nationwide and Mr Moran’s sole purpose in pursuing the amendments was to attempt to justify a subpoena to the STC.

73    It is, however, sufficient for present purposes to simply find that Nationwide and Mr Moran’s conduct of their defence to date has been productive of delay, that the delays will be added to if leave was granted to file the further amended defence, and that the explanation that has been provided for the delay was unsatisfactory. Those discretionary considerations weigh against granting leave to amend.

THE PROPOSED CROSS-CLAIM AGAINST THE STC

74    In the proposed cross-claim, Nationwide and Mr Moran claim contribution or indemnity from the STC pursuant to s 5 of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) in respect of any judgment given against them in this proceeding. Section 5(1)(c) of that Act provides as follows:

5 Proceedings against and contribution between joint and several tort-feasors

(1)    Where damage is suffered by any person as a result of a tort (whether a crime or not):

…

(c)    any tort-feasor liable in respect of that damage may recover contribution from any other tort-feasor who is, or would if sued have been, liable in respect of the same damage, whether as a joint tort-feasor or otherwise, so, however, that no person shall be entitled to recover contribution under this section from any person entitled to be indemnified by that person in respect of the liability in respect of which the contribution is sought.

75    Nationwide and Mr Moran wish to claim, in short, that if it they are held liable for damage suffered by Mr Rush as a result of the alleged defamatory publications, they may recover contribution from the STC because the STC would, if sued, have been liable in respect of the same damage, whether as joint tort-feasor or otherwise.

76    The claim that the STC would, if sued, be liable in respect of the same damage suffered by Mr Rush was essentially put on four bases, though it must be said that the four separate bases are not entirely clear or apparent on the face of the pleading.

77    First, it is alleged that the STC published three statements concerning Mr Rush to Nationwide and Mr Moran. The nature and content of those statements will be discussed shortly. It is critical to note, however, that the imputations that are alleged to have been conveyed by the first two of those statements were all of the imputations pleaded by Mr Rush against Nationwide and Mr Moran: see [5A]-[5C] and [9A]-[9D] of the proposed cross-claim. The imputations allegedly conveyed by the third statement were allegedly the same imputations pleaded by Mr Rush in respect of the third matter complained of: see [17A]-[17E] of the proposed cross-claim.

78    Second, it is alleged that the damages for the STC publishing the defamatory statements to Nationwide and Mr Moran would include damages for the foreseeable consequence of the tort, including the republication of the defamatory statements. In that regard, Nationwide and Mr Moran rely on what was said in Habib v Radio 2UE Sydney Pty Ltd [2009] NSWCA 231 at [126].

79    The first and second bases of Nationwide and Mr Moran’s proposed cross-claim may conveniently be referred to as the publication to Mr Moran claim.

80    Third, it is alleged that the STC is liable as an original publisher of the three matters complained of in Mr Rush’s case against Nationwide and Mr Moran (the 30 November poster; the 30 November 2017 Daily Telegraph article and associated web article; and the 1 December 2017 Daily Telegraph article and associated web article). That is because it is alleged that the STC “encouraged, assented to or conduced or was accessorial in the publication of each of those matters”. This may conveniently be referred to as the Webb v Bloch claim, because it is based on the principles enunciated in Webb v Bloch (1928) 41 CLR 331.

81    Fourth, it is alleged that the STC is liable for the republication by Nationwide and Mr Moran of each of the three matters complained of in Mr Rush’s case against Nationwide and Mr Moran. This may conveniently be referred to as the Speight v Gosnay claim, because it is based on the proposition, flowing from Speight v Gosnay (1891) 60 LJQB 231 at 232, that an original publisher of defamatory matter may be liable for its republication where the republication was the natural and probable result of the original publication.

The three statements allegedly made by the STC

82    The first statement allegedly published by the STC (the first STC statement) was in an email sent by Ms Katherine Stevenson of the STC to Nationwide and Mr Moran on 28 November 2017. Paragraph 5 of the proposed cross-claim states:

At approximately 3.57pm on 28 November 2017, Ms Stevenson published the following statement to the Cross-Applicants by email (the First Statement) as follows:

Sydney Theatre Company received a complaint alleging that Mr Geoffrey Rush had engaged in inappropriate behaviour. The Company received the complaint when Mr Rush’s engagement with the Company had ended. The Company continues to work with the complainant to minimise the risk of future instances of the alleged behaviour occurring in its workplace.

The complainant has requested that their identity be withheld. STC respects that request and for privacy reasons, will not be making any further comments.

83    The second STC statement is pleaded in the following terms in paragraph 9 of the proposed cross-claim:

Further and alternatively, on 30 November 2017, prior to publication of the first and second matters complained of:

a)    Ms Stevenson requested that the Second Cross-Applicant read to her the contents of the proposed article before publication in the First Cross-Applicant’s newspaper;

b)    the Second Cross-Applicant read the content of the second matter complained of, including the headline, to Ms Stevenson at her request;

Ms Stevenson did not inform the Cross-Applicants that anything in the article was inaccurate, and thereby published to the Cross-Applicants, by implication, that the contents of the first and second matters complained of in the Statement of Claim were accurate (Second Statement).

84    The third STC statement is pleaded in the following terms in paragraph 17 of the proposed cross-claim:

Further and alternatively, on or about 30 November 2017, the Second Cross-Applicant spoke to Patrick McIntyre, who stated to the Second Cross-Applicant:

(a)    I spoke to the Mr Rush on 10 or 11 November and he was aware of the complaint and I told him who had made the complaint, but I’m not sure how much detail he knew;

(b)    as a result of the complaint, the STC has changed its HR policies and practices, and, don’t attribute this to me, but the STC has vowed never to work with Mr Rush again.

(together the Third Statement).

Leave to file a cross-claim out of time – relevant principles

85    Rule 15.04 of the Rules requires a party to file and serve any cross-claim on the date that its defence is due. In Nationwide and Mr Moran’s case, that was 30 January 2018.

86    Rule 15.05 of the Rules provides that a respondent who wants to file a notice of cross-claim, but has not complied with r 15.04, must apply for leave. The leave application must be accompanied by an affidavit which states the nature of the cross-claim and its relationship with the subject matter of the proceeding and why the notice of cross-claim was not filed in accordance with r 15.04.

87    The principles that are applicable to the grant of leave to file a cross-claim out of time are relevantly the same as those that apply in the case of applications for leave to amend. Relevant considerations include: whether the subject matter of the claim fell within the Court’s jurisdiction; the extent of the delay; whether an acceptable explanation has been provided for the delay; any prejudice to the other party or parties occasioned by the delay; the merits or strength of the proposed cross-claim; the degree of connection between the proposed cross-claim and the subject matter of the principal proceedings; and the desirability that all disputed matters between the parties connected with the subject matter of the proceedings be dealt with in the main trial: Trade Practices Commission v Allied Mills Industries Pty Ltd (1980) 33 ALR 127 at 129, 133, 134; Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FCR 344 at 348–9; Sunbeam Corporation Ltd v Breville Pty Ltd [2007] FCA 496; Lendlease Project Management and Construction (Australia) Pty Ltd v Construction, Forestry Mining and Energy Union (No 3) [2011] FCA 912 at [18]; Tada Constructions Corporation Pty Ltd v JP Dixon Real Estate Pty Ltd (No 3) [2012] FCA 329.

88    As has already been touched on, Mr Rush opposed the grant of leave to file the proposed cross-claim. He advanced two main grounds for the opposition. First, he submitted that the cross-claim was hopeless, if not absurd, and doomed to fail. Second, he submitted that there were powerful discretionary factors which weighed against the grant of leave to file the cross-claim. In particular, he contended that if leave was granted, it would result in a significant delay, and a much lengthier hearing, and would effectively mean that the trial could not be listed for hearing in August or September 2018, as had been envisaged by the Court. Consistent with the approach taken in relation to the application for leave to amend the defence, Mr Rush also contended that the real reason that Nationwide and Mr Moran wanted to file the cross-claim was so they could seek discovery of the STC’s documents and thereby could “fish” for a justification defence to Mr Rush’s claim against them. In any event, he submitted that the explanation given for the delay in seeking to file the cross-claim was unsatisfactory.

89    For their part, Nationwide and Mr Moran submitted that the cross-claim against the STC was strongly arguable, that there was a high degree of connection between the proposed cross-claim and the principal proceedings, that the delay had been slight and had been reasonably explained, and that if leave was not granted, it would be necessary for separate proceedings to be commenced against the STC, in which case there was a risk of inconsistent findings by the Court.

SHOULD LEAVE BE GRANTED TO FILE THE PROPOSED CROSS-CLAIM?

90    There is no doubt that the subject matter of the proposed cross-claim falls within the Court’s jurisdiction and no doubt that the subject matter of the proposed cross-claim is closely related to the subject matter of the principal proceedings between Mr Rush and Nationwide and Mr Moran. It may also be readily accepted that it would be preferable and desirable for all the disputed matters between the parties connected with the subject matter of the proceedings to be dealt with in the main trial. If Nationwide and Mr Moran were required to commence separate proceedings against the STC, any risk of inconsistent findings would be undesirable. Each of these considerations weigh in favour of the grant of leave.

91    There are, however, three powerful considerations that militate against the grant of leave to file the proposed cross-claim. The first relates to the merits of the proposed cross-claim. The second is the delay and the risk of prejudice to Mr Rush. The third concerns the adequacy of the explanation for the delay and related discretionary considerations.

The merits of the proposed cross-claim

92    It would be fair to say that the proposed cross-claim is novel. The notion of a major media organisation and one of its journalists joining one of its sources for a story, and in doing so, identifying someone previously regarded as a confidential source, is unusual. The STC did not instigate any of the publications. Rather, it was Mr Moran, on behalf of Nationwide, who contacted the STC and asked it to provide an “official comment”. The STC complied with that request and provided what, on one view at least, is a very carefully worded statement concerning an allegation that had been made against Mr Rush. In the following days, Mr Moran sought and received further comment. The suggestion that the STC defamed Mr Rush by providing an official comment to Mr Moran in response to a request by him is, to say the least, somewhat unusual.

93    Novelty, however, is no basis to refuse leave. The more significant issue is whether the proposed cross-claim against the STC has, or is likely to have, any real merit.

94    In circumstances where, should leave be refused, Nationwide and Mr Moran may choose to pursue a separate claim against the STC, it would imprudent and undesirable to express a concluded view on whether the proposed cross-claim against the STC is reasonably arguable. It would be even less desirable to express a concluded view on whether the claim is hopeless, absurd or doomed to fail, as contended by Mr Rush. In considering whether leave to file the cross-claim should be granted, it is sufficient to make a finding concerning the strength or potential merits of the claim. That is plainly a relevant consideration in the exercise of the discretion whether or not to grant leave.

95    The significant problem for Nationwide and Mr Moran is that, when the proposed cross-claim is carefully analysed in light of the relevant authorities, the very best that could be said of the proposed cross-claim is that it is very weak, if not highly tenuous or questionable.

The publication to Mr Moran claim

96    The fundamental difficulty with the claim based on the publications to Mr Moran is that it is highly questionable that the alleged publications – the three statements the STC allegedly made to Mr Moran – are reasonably capable of conveying any, let alone all, of the imputations that Nationwide and Mr Moran allege they conveyed.

97    It will be recalled that the first statement made by the STC was the email sent on 28 November 2017 which stated that the STC had “received a complaint alleging that Mr Geoffrey Rush had engaged in inappropriate behaviour” and that the STC “continues to work with the complainant to minimise the risk of future instances of the alleged behaviour occurring in its workplace”. The proposed cross-claim alleges that the first STC statement conveyed all of the imputations that Mr Rush pleads against Nationwide and Mr Moran. That includes, in summary, that Mr Rush had engaged in “scandalously inappropriate behaviour in the theatre”; “inappropriate behaviour of a sexual nature”; “sexual assault”; “behaved as a sexual predator”; “inappropriately touched an actress”; and was a “pervert”.

98    It is, to say the very least, extremely difficult to see how it could possibly be asserted that the first statement conveyed any of those imputations. For a start, the first STC statement is couched entirely in terms of an allegation. Mr Rush’s pleaded imputations, which the proposed cross-claim asserts were also conveyed by the first STC statement, are couched in terms of guilt. The first STC statement also states only that Mr Rush was alleged to have engaged in “inappropriate behaviour”. It says nothing which would suggest that the behaviour could be characterised as “scandalous”, let alone that it was of “a sexual nature”, or involved “sexual assault”, or “inappropriate touch[ing] of an actress”.

99    In their submissions, Nationwide and Mr Moran resorted to the well-known statements of Lord Devlin in Lewis v Daily Telegraph that the ordinary reader would “read between the lines” and that “[a] man who wants to talk at large about smoke may have to pick his words very carefully if he wants to exclude the suggestion that there is also a fire”. The difficulty, however, is that the STC appears to have picked its words carefully, given little scope for reading between the lines, and generated little if any “smoke”.

100    Different issues arise in relation to the second STC statement.

101    The first difficulty is that it is, to say the very least, difficult to see how, by her silence, Ms Stevenson of the STC could seriously be said to have “published” a defamatory communication to the effect that the contents of the first and second matters complained of were accurate. The key factual allegation, as pleaded, is that on 30 November 2017, which was the date on which the first and second matters complained of were published, Ms Stevenson asked Mr Moran to read to her the contents of the “proposed article”. Mr Moran did so. He also read the “headline” (singular). Ms Stevenson said nothing.

102    The issues that arise from this pleading are manifest.

103    First, it is difficult to come to grips with the notion of a publication constituted by silence. In Gatley on Libel and Slander, (12th ed (2013), Sweet & Maxwell), a frequently cited and well-respected text in relation to libel and defamation law, it is stated (at [6.12], page 202) that “[a]s a general rule, silence is not libel so that a failure to object to a defamatory communication made by another will not without more, be actionable”. The cases cited in support of that proposition include Frawley v State of New South Wales [2006] NSWSC 248 and Underhill v Corser [2010] EWHC 1195; see also the cases referred to in Frawley, including Urbanchich v Drummoyne Municipal Council (1991) Aust Torts Reports 81-127 and Bishop v State of New South Wales [2000] NSWSC 1042. The facts and circumstances of those cases are somewhat removed from the facts and circumstances of this case. Nevertheless, they support the proposition that silence, or the failure to object, to a defamatory communication will not itself constitute a defamatory publication unless the defendant is aware of the entirety of the defamatory publication, and had the opportunity, ability and power to put a stop to it.

104    It is difficult to see how it could be said that Ms Stevenson of the STC was aware of the entirety of the second matter complained of (let alone the first and third matters complained of), even if it was read to her. It is even more difficult to see how it could seriously be contended that she had the opportunity, ability or power to put a stop to the publication.

105    Second, the conversation supposedly occurred on the day of publication. Unless the conversation occurred very early in the morning, which is unlikely, it is hard to see how this conversation could have occurred before the first and second matters had already been published to the public at large. It was suggested, in the course of Nationwide and Mr Moran’s submissions, that the date referred to in paragraph 9 of the proposed cross-claim was an error and should read 29 November 2017. Nevertheless, this difficulty exists on the present state of the proposed pleading.

106    Third, there is nothing to suggest that Ms Stevenson’s purpose in having the article read to her was so that she could say, one way or the other, whether the contents of the article were accurate. It is not alleged that Ms Stevenson asked for the article to be read for that purpose. Nor is there any suggestion that Mr Moran read the article to Ms Stevenson for that purpose. It is not, for example, alleged that Mr Moran asked Ms Stevenson to verify or confirm the accuracy of the article. It is also to be noted, in that regard, that in Nationwide and Mr Moran’s defence, it is asserted that Mr Moran read the article to Ms Stevenson “for the purpose of it being relayed to the Complainant”. That obvious and important inconsistency between the existing defence and the proposed cross-claim has not been explained.

107    Fourth, there is no suggestion that, when he read the article to Ms Stevenson, Mr Moran spelt the headline “King Leer” (so as to make it clear that the headline was not “King Lear” which, of course, would carry an altogether different connotation), or read the headline “Bard Behaviour”, or described the layout of the articles, including the positioning of the article concerning allegations of sexual assault that had been made against Don Burke directly adjacent to the article concerning Mr Rush, or read the first matter complained of at all. It follows that, as noted earlier, it is extremely difficult to see how it could be contended that Ms Stevenson was aware of the entirety of the second matter complained of. It is, in many respects, the headlines, photographs and layout of the articles, including the juxtaposition with the story concerning Don Burke, which is alleged to have carried the real “sting” of the publication.

108    The second difficulty is that the silence of Ms Stevenson, after having been read the “article” (presumably the second matter complained of) is alleged to have conveyed all the imputations that Mr Rush contends the three matters complained of conveyed. It is difficult enough to come to grips with the contention that Ms Stevenson’s silence conveyed any, let alone all, of the imputations allegedly carried by the second matter complained of. It is even more difficult to see how Ms Stevenson could be said to have approved or verified the accuracy of the imputations allegedly carried by the first and third matters complained of. It is not alleged that those publications were read to Ms Stevenson. Indeed, the third matter complained of probably had not even been drafted at the time of the conversation between Mr Moran and Ms Stevenson.

109    Needless to say, the contentions in the cross-claim concerning the second STC statement and the imputations said to have been conveyed by it are, to say the very least, weak and at best highly tenuous.

110    As for the third STC statement, the allegation is that Mr McIntyre of the STC told Mr Moran that he had spoken with Mr Rush on 10 or 11 November and “he [Mr Rush] was aware of the complaint and I told him who had made the complaint, but I’m not sure how much detail he knew” and that, as a result of the complaint, “the STC has changed its HR policies and practices, and, don’t attribute this to me, but the STC has vowed never to work with Mr Rush again”. These statements are alleged to have conveyed all the defamatory imputations carried by the first and third matters complained.

111    The suggestion that, in this conversation, Mr McIntyre somehow conveyed that Mr Rush was a “pervert”, or had behaved as a “sexual predator”, or had engaged in “inappropriate behaviour of a sexual nature”, or had “committed sexual assault”, or had “inappropriately touched an actress” is, to say the very least, rather hard to accept.

112    The proposed cross-claim also alleges that the third STC statement conveyed to Mr Moran the imputation that Mr Rush had “falsely denied that the Sydney Theatre Company had told him the identity of the person who made a complaint against him”. That imputation was said to be conveyed because Mr Moran “knew the extrinsic fact that [Mr Rush], through his solicitors, had denied that he had been approached by [Nationwide] or the complainant or any representative of either of them concerning the complaint of inappropriate behaviour by him and had denied that he had been informed of the nature of the complaint or what it involved (denials which had been reported in The Daily Telegraph that morning)”. The difficulty, however, is that nowhere is it stated, reported or alleged that Mr Rush denied that the STC had told him the identity of the complainant. It is, in those circumstances, difficult to see how the imputation could have been conveyed by what Mr McIntyre said to Mr Moran, even if Mr Moran knew the alleged extrinsic fact.

113    Finally, there may well be an issue concerning the authority or capacity of Mr McIntyre to make the third STC statement on behalf of the STC in circumstances where he expressly said that part of the statement should not be attributed to him.

114    In all those circumstances, as with the first two STC statements, the contentions in the proposed cross-claim concerning the third STC statement are, at best, weak and highly tenuous.

115    The contention that the damages flowing from the defamatory statements that the STC allegedly made to Nationwide and Mr Moran would include damages for the foreseeable consequence of the tort, including Nationwide and Mr Moran’s republication of those statements, is referred to later in the context of the Speight v Gosnay claim. It is sufficient, at this stage, to make two brief points. First, unless STC could reasonably be said to be liable for damages flowing from the alleged republication by Nationwide and Mr Moran, the damages (and therefore contribution) that would flow from STC’s publication to Mr Moran alone would be nominal, if not, infinitesimal. Second, the suggestion that the STC could reasonably have foreseen that Nationwide and Mr Moran would have republished the statements in the form they did in the three matters complained of is, to say the very least, extremely difficult to accept.

The Webb v Bloch claim

116    In Habib, McColl JA (with whom Giles and Campbell JJA agreed), explained the basis of liability as a principal for publication in the following terms (at [121]):

Liability as a principal for publication of defamatory material depends upon participation: see Gatley (at [6.16]). All who are in any degree accessory to the publication of a libel, and by any means whatever conduce to the publication, are to be considered as principals in the act of publication: thus if one suggests illegal matter in order that another may write or print it, and that a third may publish it, all are equally amenable for the act of publication when it has been so effected: Webb v Bloch (at 364) per Isaacs J. Such persons are regarded as joint tortfeasors: Webb v Bloch (at 359) per Knox CJ. Subordinate distributors can plead the common law defence of innocent dissemination (Emmens v Pottle (1885) 16 QBD 354), or its statutory analogues: see, for example, s 32, Defamation Act 2005.

117    In the event that the reader (like the writer) is not immediately familiar with the word “conduce”, when used in this context, it means “to lead or contribute to a result” (Macquarie Dictionary) or “bring about, bring to effect; lead or tend towards, contribute to; promote, encourage” (Shorter Oxford Dictionary).

118    It is important to emphasise three important points that are likely to arise in cases where a defendant is alleged to be liable as a principal for publication on the basis that he or she contributed a statement or other material that was included in the publication. Each of these points relate, in one way or another, to the question whether a defendant who simply provides a statement or other material to a third person who includes it in a larger published article, may be held to have participated in, or been an accessory to, the larger published article.

119    First, it is generally necessary for the claimant to prove that, by contributing the statement or other material to the publisher, the defendant participated in, or was an accessory to, the entire publication. Thus, it will be necessary for Nationwide and Mr Moran to prove that the STC participated in, or was an accessory to, or brought about the publication of the entirety of each of the three matters complained of. That is clear from the terms of ss 4 and 8 of the Defamation Act. Section 8 of the Defamation Act provides that a person has a single cause of action in relation to the publication of “defamatory matter” about the person even if more than one defamatory imputation about the person is carried by the “matter”. The word “matter” is defined in s 4 of the Defamation Act as including, relevantly, “an article, report … or other thing communicated by means of a newspaper …”.

120    It is, in those circumstances, not enough for Nationwide and Mr Moran to prove that the STC was only an accessory to, or brought about, the republication of the three statements it made to Mr Moran. It is not permissible for Nationwide and Mr Moran to plead a cause of action based on publication of only part of an article: Mohareb v Fairfax Media Publications Pty Ltd (No 3) [2017] NSWSC 645 at [40]-[44].

121    Second, it is generally necessary for the claimant in such a case to prove that the relevant publication reproduced the “sense and substance” of the statement or other material provided by the defendant, even if the reproduction or republication may have, to some extent, altered the language: Parkes v Prescott (1869) LR 4 Ex 169 at 178; Mohareb v Fairfax at [34]-[38]. If the publisher altered the sense or substance of the statement or other material provided by the defendant, it is difficult to see how it could be said that the defendant participated in, or was an accessory to the publication.

122    It should be noted, in this context, that Nationwide and Mr Moran relied on what was said by Hunt J in Sims v Wran [1984] 1 NSWLR 317 at 320C:

Where a prominent politician such as the defendant makes a statement at a press conference, it may be taken without doubt that the natural and probable result of his act will be that his statement will be republished in the media, thereby making him responsible for that republication: Speight v Gosnay (1891) 60 LJQB 231 at 232; and usually in whatever form in which that republication takes place: Webb v Bloch (1928) 41 CLR 331 at 363-366.

123    Nationwide and Mr Moran highlighted the words “in whatever form in which that republication takes place”. It is, however, doubtful that in using those words, Hunt J was suggesting that, adopting the example given by his Honour, the politician would be liable for the republication if it changed the sense or substance of what he said. Nor would it appear that his Honour was suggesting that the politician would be responsible for the entirety of the publication if it contained additional material, or conveyed different or additional imputations: see Mohareb v Fairfax at [20].

124    Third, “where a person merely contributes material to an article but has no control over the publishing process, liability as a publisher will not ordinarily be established unless he or she has assented to its final form”: Dank v Whittaker (No 1) [2013] NSWSC 1062 at [26]. In Dank v Cronulla Sutherland District Rugby League Football Club Ltd [2014] NSWCA 288, at [129]-[137], Ward JA (with whom Emmett and Gleeson JJA agreed) appeared to approve that proposition, albeit as a particular application of the test in Webb v Bloch.

125    That proposition is also supported by what was said by the Full Court of the Supreme Court of Queensland in Theiss v T.C.N. Channel Nine Pty Limited (No. 5) [1994] 1 Qd R 156. In that case, it was alleged, amongst other things, that Mr Woodham published all of the imputations that were conveyed by a number of television programs broadcast by Channel Nine. Mr Woodham had provided content for those programs. The Full Court said (at 195):

What is said in Webb v Bloch and Gatley would perhaps suffice to make Woodham liable with TCN 9 if he had seen the script or viewed the programmes before publication; but the evidence is that he did not do so. The decision in Webb v. Bloch is concerned with a case that is in some ways the direct converse of this. There the question was whether the defendants were principals of the solicitor Norman, who was the author and publisher of the defamatory circulars. No one suggests that Woodham was the principal of TCN 9 as author and publisher of the television programmes. He is not shown to have exercised control over its final form. At most he played a subsidiary and intermediate, if important, part in the creation of the product that in its finished state ultimately went to air. It is true that Woodham himself, or the visual image of Woodham, appeared in one or more of the programmes (principally the first ACA programme) broadcast by TCN 9, and that he was visible and audible to viewers as saying words that may have formed part of “the matter supporting the imputations or any of them”. However, as we have seen, and despite the form of question 1, what the jury were asked to do was not to say whether Woodham published some, but whether he published all, of the matter supporting the defamatory imputations. Unless he was a co-publisher of all, the jury were, having regard to the way in which that question was left to them, entitled and indeed bound to find that he was not a co-publisher “with” TCN 9. As to that, the evidence is that there were some matters published about which Woodham knew little or nothing.

126    It should be reiterated that these three points all ultimately relate to the question whether the person who provided the statement or content that was then published in a newspaper article or television program could be said to be liable as the original publisher on the basis that he or she participated in, or was an accessory to, the publication. Each case must of course be considered on its own facts.

127    The application of those principles may be illustrated by three relatively recent cases in the Supreme Court of New South Wales which involved facts and circumstances that were relatively analogous to the facts and circumstances of this case.

128    In Mohareb v Harbour Radio Pty Ltd [2017] NSWSC 353, McCallum J considered a claim against the Attorney-General, who had been sued as a joint tortfeasor on that basis that an interview between her and a radio announcer had been included in two radio broadcasts by that announcer. McCallum J struck out the claim against the Attorney-General on the basis that she could not be taken to have joined in or assented to the whole of the broadcasts and had no control over their final form.

129    Similarly, in Mohareb v Fairfax, the Attorney-General published an email to a journalist and authorised the republication of the contents of the email by the journalist. The email was subsequently republished in a newspaper article. McCallum J refused leave to file an amended pleading which alleged that the Attorney-General was liable as an original publisher of the newspaper article. Her Honour held (at [39]):

In my view, the newspaper article complained of in the present case is incapable of being characterised as a republication of the Attorney’s email. It may be accepted that it is at least capable of conveying some of the same imputations. The difficulty is that it also contains a considerable amount of additional material giving rise to additional imputations that are incapable of arising from the Attorney’s email. In my view, that is determinative of the present question.

130    Finally, in Noble v Phillips (No 2) [2018] NSWSC 25, McCallum J struck out a claim which asserted that two persons who gave quotes for attribution that were used in a newspaper article were liable as joint tortfeasors. Her Honour found (at [45]) that the facts alleged were not capable of establishing the necessary assent or control in respect of the article.

131    When close consideration is given to the relevant principles and the pleaded facts and circumstances in this case, it can readily be seen that the proposed cross-claim against STC on the basis that it is liable as the original publisher of the three matters complained of is extremely weak and tenuous. Putting the second STC statement to one side for the moment, there could be little doubt that the substance of the first and third STC statements was republished in the second and third matters complained of. The difficulty, however, is that it is equally clear that those three publications travelled well beyond the first and third STC statements. They contained a good deal of additional material. Perhaps more significantly, Mr Rush’s case is that the real “sting” in the publications was the product of the headlines, photographs, layout and juxtaposition of other articles, including the article concerning Don Burke. It is difficult to conclude otherwise than that the two publications conveyed materially different and additional imputations than those conveyed by the first and third STC statements.

132    As for the second STC statement, the difficulties with Nationwide and Mr Moran’s case in relation to that statement have already been discussed in considerable detail. Suffice it to say that the contention that, by her silence, Ms Stevenson assented to the final form of the second matter complained of is, at best, extremely weak. The contention that Ms Stevenson assented to the final form of the first and third matters complained of borders on the unarguable. Equally, the apparent suggestion that Ms Stevenson had the opportunity, ability or power to somehow stop or change the final form of any of the publications by Nationwide and Mr Moran borders on the fanciful.

133    All in all, the best that could be said about the proposed Webb v Bloch claim against the STC is that it faces significant legal and factual hurdles and is, on just about any view, an extremely tenuous claim.

The Speight v Gosnay claim

134    Much the same can be said about the proposed Speight v Gosnay claim. The difficulties that have been addressed in detail in the context of the publication to Mr Moran claim and the Webb v Bloch claim all apply equally to the Speight v Gosnay claim. It is unnecessary to repeat what has already been said. Suffice it to say that the fundamental problem is that, like the other claims, the Speight v Gosnay claim requires Nationwide and Mr Moran to prove that the statements made by the STC conveyed all the same imputations that Mr Rush alleges were conveyed by the three matters complained of (the poster and the two Daily Telegraph articles). For the reasons already given, that contention is, to say the very least, extremely difficult to accept. Indeed it is difficult to accept that the STC statements conveyed any of the imputations alleged by Mr Rush against Nationwide and Mr Moran. The overall content, headlines, photographs, layout and other features of the three matters complained of conveyed something entirely different to the statements made by the STC. As has also already been explained in detail, the contention that Ms Stevenson, on behalf of the STC, approved or assented to the second matter complained of (let alone the first and third matters complained of), or somehow had the opportunity, ability or power to stop or even alter that publication is also extremely weak.

Conclusion in relation to the merits of the cross-claim

135    It follows from this discussion of the proposed cross-claim that each of the four ways that Nationwide and Mr Moran put their case against the STC faces significant factual and legal hurdles. The proposed cross-claim as presently pleaded is weak and the prospects of success are poor. It should be emphasised and reiterated that this is not a concluded finding that any claim that Nationwide and Mr Moran may have against the STC is not reasonably arguable.

136    Equally, nothing that has been said should be taken to be directed to the merits of Nationwide and Mr Moran’s defence to Mr Rush’s claim. That was not the subject of argument. This analysis has been directed solely to the merits of the proposed cross-claim against the STC.

Delay and prejudice

137    The Rules provide that Nationwide and Mr Moran were required to file the cross-claim on 30 January 2018. They did not seek leave to file the cross-claim until 3 April 2018, though the amended interlocutory application annexing the final version of the proposed cross-claim was later still. The delay is accordingly just over two months. In some litigation, such a delay would not be particularly significant. In this particular litigation, however, the delay is significant and is likely to be productive of considerable prejudice to Mr Rush.

138    Mr Rush commenced these proceedings promptly. He has, at each opportunity, sought to pursue his claim without delay. He seeks public vindication at a time when the alleged defamatory publications are still fresh in the mind of the public. As the chronology of the proceedings described earlier clearly shows, however, Mr Rush’s attempts to have his matter heard at the earliest opportunity have been frustrated by Nationwide and Mr Moran’s conduct of their defence. They filed a defence towards the very end of the period prescribed by the Rules. The defence as originally filed contained insufficient and deficient particulars of Nationwide and Mr Moran’s pleaded defences. They effectively admitted as much when they sought leave to file an amended defence. They were given leave to file, and in due course filed, an amended defence. That amended defence was found, in Rush v Nationwide No. 1, to have contained insufficient particulars of the defence of justification, and to have included irrelevant and ambiguous particulars of their defence of qualified privilege. Nationwide and Mr Moran are pursuing an application for leave to appeal against the judgment striking out parts of their defence of qualified privilege, but at the same time have sought to amend the defence and file a cross-claim.

139    The prejudice to Mr Rush is that the filing of the cross-claim, if permitted, will almost certainly make it considerably more difficult, if not impossible, for Mr Rush to secure a hearing date for his case this year. The pleadings in Mr Rush’s case against Nationwide and Mr Moran are now effectively closed, subject perhaps to the grant of leave to appeal. If leave is granted to file the cross-claim, the effect will be that a new party will be joined in the proceedings. That new party, the STC, will need time to consider its position and file a defence. It may also seek to strike out some or all of the claims made against it. Indeed, having regard to the earlier detailed analysis of the cross-claim, that would appear to be almost inevitable. It is difficult to see how the matter could be set down for a trial involving the claims against the STC before the STC is given a fair and reasonable opportunity to consider and file its defence, or take any other interlocutory steps properly available to it.

140    If leave is not granted to file the cross-claim, Mr Rush’s case could be heard as early as August or September 2018.

141    Nationwide and Mr Moran submitted that they were prepared to meet a timetable which had the final trial being heard in August or September 2018. They said that they would do all that they can to facilitate that. They also suggested that the STC would, if joined, most likely be able to meet such a timetable. That suggestion is at best speculative. Putting aside the fact that fairness would require that, if joined, the STC be given some opportunity to make submissions in relation to the hearing date, it is almost impossible to see how the STC could consider its position, file a defence and pursue all necessary interlocutory steps it needs to pursue in time for a trial in August or September 2018.

142    The earlier discussion concerning the merits of the proposed cross-claim also strongly indicates that the joinder of the STC would significantly complicate and lengthen the hearing. The cross-claim undoubtedly raises some difficult and complex questions that simply do not arise in Mr Rush’s claim against Nationwide and Mr Moran. The estimate that has been given of the duration of the trial of Mr Rush’s claim against Nationwide and Mr Moran is one week. The estimate of the duration of the trial if the STC is joined is two weeks. That estimate appears to be reasonable. It may well be overly conservative.

143    The submissions made by Nationwide and Mr Moran in respect of delay and prejudice also conveniently ignore that if the STC is joined, they will almost inevitably seek an order for discovery against the STC. More will be said about that later in the context of the explanation for the delay. Suffice it to say at this stage that it is not known what additional issues may arise, and what additional delays may be encountered, as a result of the discovery process.

Explanation for the delay

144    The only explanation for the delay in filing the cross-claim is that a forensic or tactical decision was taken by Nationwide News and Mr Moran. That is the effect of Mr Perkins’ evidence. His evidence should be set out in full, if only because what he does not say is perhaps as significant as what he does. His evidence was:

Prior to the filing of the defence in these proceedings on 1 February 2018, consideration was given by the respondents to whether the Sydney Theatre Company should be joined as a cross respondent in view of the reliance by the respondents on the information obtained from the Company. The respondents made the decision not to join the Sydney Theatre Company at that time. The respondents have reconsidered the question and now wish to join the Sydney Theatre Company as a cross-respondent. The decision of the Respondents to add the Sydney Theatre Company as a Cross Respondent has been taken by the Respondents in consequence of the striking out of the defence of justification and parts of the defence of qualified privilege. The Respondents consider that the defence is not as strong as previously and for that reason wish to join the Sydney Theatre Company.

145    The following points may be made about this evidence. First, the explanation is given by a solicitor, not the client: cf Tamaya at [155]. Second, Mr Perkins does not identify who, on behalf of Nationwide and Mr Moran, made the decision. Third, Mr Perkins does not reveal why Nationwide and Mr Moran decided not to join the STC at the time they filed their defence. In the absence of any other explanation, the available inference is that the decision was taken because such a claim was novel and faced major legal and factual hurdles. Another available inference is that Nationwide and Mr Moran initially thought that they would be able to subpoena the STC to produce documents in relation to the alleged complaint made against Mr Rush. Fourth, Mr Perkins does not say who, on behalf of Nationwide and Mr Moran, was involved in the reconsideration and change of mind concerning the filing of a cross-claim. Fifth, when stating the reasons for deciding to join the STC, Mr Perkins does not refer to the significance of the setting aside of the subpoena to the STC. Sixth, Mr Perkins does not explain exactly how the fact that Nationwide and Mr Moran considered that the “defence is not as strong as previously” had a bearing on their decision to join the STC. Was he saying that his clients thought that the cross-claim against the STC for contribution somehow strengthened their defence to the claim by Mr Rush? If so, how?

146    The available, indeed almost inescapable, inference is that the decision taken by Nationwide and Mr Moran to file a cross-claim against the STC was taken because they knew that if they filed a cross-claim, they could seek a discovery order against the STC. They could then obtain documents from the STC which might provide them with a justification defence to Mr Rush’s claim. They previously thought that they could obtain those documents by subpoena. Their hopes in that regard, however, were dashed by the decision in Rush v Nationwide No. 1. That explains the change of heart in relation to the cross-claim.

147    This inference is, in a sense, consistent with Mr Perkins’ evidence, or at least not inconsistent with it. After the judgment in Rush v Nationwide No. 1, Nationwide and Mr Moran no doubt considered that their defence was not as strong as previously. That was for the most part because they no longer had a defence of justification. They saw that one way of potentially strengthening their defence was to join the STC and hopefully obtain documents from it by way of discovery. In that sense, it may be accepted that they did make the decision because they considered that their defence was not as strong as previously.

148    Nationwide and Mr Moran submitted that this inference could not be drawn because Mr Perkins was not cross-examined. That submission is rejected. For the reasons just given, the inference is not inconsistent with Mr Perkins’ evidence. In any event, Mr Perkins was the solicitor, not the client. The explanation that was required was the explanation of Nationwide and Mr Moran. It was open to Mr Moran and the relevant decision-maker at Nationwide to give direct evidence about how they came to change their mind about filing the cross-claim. They chose instead to lead hearsay evidence through their solicitor.

149    In any event, and irrespective of whether or not that inference can or should be drawn, Mr Perkins’ explanation for the delay is far from satisfactory or adequate. More significantly, it provides no good reason why leave to file the cross-claim should be granted. Nationwide is an experienced, sophisticated and well-represented litigant in defamation matters. It is difficult to see how the making of a tactical decision not to file the cross-claim when it was required to be filed is an adequate explanation for the delay. There is good reason to hold Nationwide and Mr Moran to their earlier tactical decision, particularly where the result of granting them leave would be to visit delay and substantial prejudice upon Mr Rush.

Countervailing considerations

150    As has already been noted, the effect of refusing leave to file the cross-claim is that, if Nationwide and Mr Moran wish to pursue their claim against the STC, they will need to do so in separate proceedings. It may readily be accepted that such an outcome would not be desirable for a number of reasons. It would plainly be preferable for all disputed matters between the parties connected with the alleged defamation of Mr Rush, including any claims for contribution, be dealt with in the one proceeding. The desirability of avoiding a multiplicity of proceedings in and of itself weighs in favour of the grant of leave.

151    The risk of inconsistent findings in any separate proceedings is an even weightier consideration. There is no doubt that if leave to file the cross-claim is not granted, and Nationwide and Mr Moran subsequently commence separate proceedings against the STC, the STC would not be bound by all of the findings made in the proceedings between Mr Rush and Nationwide and Mr Moran. Nationwide and Mr Moran put forward a number of possible scenarios which gave rise to the risk of inconsistent findings. It may be accepted that the very point of the third party procedure is to get the third party (in this case, if leave is granted, the STC) bound by the decision between the plaintiff and the defendant (here Mr Rush and Nationwide and Mr Moran respectively): Barclays Bank v Tom [1923] 1 KB 221 at 224. Equally, it may be accepted that the spectre of inconsistent findings is undesirable.

152    While those are weighty considerations, they are not sufficient to outweigh the substantial considerations that weigh against the grant of leave. That is so for a number of reasons. First, Nationwide and Mr Moran should have weighed those considerations in the balance when they decided against joining the STC at the outset. Second, for the reasons already given, the cross-claim is weak, tenuous and uncertain. There is a very real prospect that Nationwide and Mr Moran will ultimately decide against filing separate proceedings against the STC. Third, that is all the more so given that the available inference is that the main reason that Nationwide and Mr Moran want to join the STC is so they can get their hands on the STC’s documents pursuant to a discovery order and thereby “fish” for a defence to Mr Rush’s claim. That motivation disappears if Nationwide and Mr Moran are required to commence separate proceedings. Fourth, the possibility of inconsistent findings is little more than speculation. Given the nature of the issues involved in this proceeding, and the fact that this, and any separate proceedings, will be tried by a judge alone, not a jury, the possibility of any inconsistent findings is more apparent than real. Fifth, and in any event, for the reasons already given, the delay and prejudice to Mr Rush, should leave be granted, is sufficiently serious to outweigh those considerations.

Weighing the considerations – Conclusion

153    Once all the relevant considerations are weighed in the balance, the balance comes down firmly in favour of refusing leave to file the cross-claim. The proposed cross-claim is, at best, very weak and highly questionable. The prejudice to Mr Rush arising from the delay in filing the cross-claim within time is substantial. The delay has not been adequately explained. While the multiplicity of proceedings is undesirable, it is by no means certain that Nationwide and Mr Moran will ultimately file separate proceedings against the STC. If they do, there is theoretically a risk of inconsistent findings, but in all the circumstances that risk is very small.

154    In all the circumstances, leave to file the cross-claim against the STC should be refused.

CONCLUSION AND DISPOSITION

155    Leave to file the further amended defence, in the form annexed to the amended interlocutory application filed by Nationwide and Mr Moran is refused. The amended interlocutory application seeking that leave is dismissed with costs.

156    Leave to file the proposed amended defence in the form annexed to the interlocutory application as originally filed on 3 April 2018 should be granted in the event that Nationwide and Mr Moran want to file that document.

157    Leave to file the proposed cross-claim against the STC is also refused and the amended interlocutory application seeking that leave is dismissed with costs.

158    Upon the handing down of this judgment, orders will be made for the further conduct of the proceeding. Those orders will include fixing the matter for trial to commence in either August or September 2018. The parties will be given an opportunity of making further submissions before those orders are made.

Associate:

Dated:    20 April 2018