DISTRICT COURT OF QUEENSLAND

Introduction

1. [1]
   The plaintiffs, John Peter Page and Gregory John Lennon, were found guilty on charges by the Queensland Racing Board relating to false declarations and fined $15,000.00 each. Another person, Patrick O'Reilly, was found guilty on six charges and was banned from Australian race tracks for twenty years. The complaint leading to those charges was lodged by the first defendant, Paul Freebody, a Cairns City Councillor. The main complaint related to the transfer of a racehorse Secale from the Four Win Syndicate to the plaintiffs. These matters were reported by the second defendant on 7 May 2004.

2. [2]
   Subsequently, the second defendant reported on 22 October 2004 that the plaintiffs had been cleared of the charges by the Racing Tribunal. The conviction and penalty against Mr. O'Reilly stood. On 22 October 2004, the first defendant wrote a letter to the editor of the second defendant which was headed “Racing Figures cleared CP 22.10.2004”.^[1]Subsequently, on 26 October 2004, the second defendant published the letter in an amended form.^[2]The plaintiffs now sue both the first and second defendants for damages for publishing defamatory material.

3. [3]
   The present applications by the first and second defendants seek to have the pleadings or parts thereof struck out^[3]and for summary judgment^[4]if the court is satisfied that no reasonable cause of action is disclosed.

Nature of the publications

4. [4]
   The letter to the editor of 22 October reads as follows

 Racing Figures cleared CP 22.10.2004

“I congratulate Mr Lennon and Mr Page on being acquitted, the penalty for their part of false statutory declarations may have been a little harsh, Paddy O'Reilly has been proven to be the real dishonest person in the whole investigation!  Maybe John and Greg just got caught up in the middle by pure association!

The lesson here for John and Greg is the old saying ‘If you sleep with dogs you get Fleas” I am sure they will be more selective of whom they associate with in the future!

The other good thing to come out of this long investigation in to corruption in the far north Qld racing Syndicates is that many people have told me that their syndicates Managers have lifted their acts in accountability since the four win Syndicate Scam was exposed. This has meant better accountability from all involved in Syndicate management which has to be better for Qld racing, Qld racing head office is also keeping a close eye on the north now!

On another point, I hope that John Page works with his committee and goes to public consultation before anything happens with Cannon Park!

In my view Cannon Park should stay were it is, I don’t think it will work 10 klm down the track at Edmonton or Gordonvale Pure distance will be its main rival The  Amateurs racing committee must be very concerned as these events roll out. Let’s hope we find a balance between the community and the almighty dollar!”

5. [5]
   The letter actually published on 26 October reads as follows:

Two caught up by association.

“I CONGRATULATE Mr Lennon and Mr Page on being acquitted - the penalty for their part in false statutory declarations may have been harsh.

    Maybe John and Greg just got caught up by association. The lesson is the old saying, “If you sleep with dogs you get fleas”.

    The other good things to come out of this long investigation into corruption into racing syndicates is that many people have told me that their syndicate managers have lifted their acts in accountability since the Four Win Syndicate scam was exposed.

    On another point, I hope that John Page works with his committee and goes to public consultation before anything happens with Cannon Park.

    In my view, Cannon Park should stay where it is. I do not think it will work 10km or so down the track at Edmonton or Gordonvale. Pure distance will be its main rival.

    Let’s hope we find a balance between the community and the almighty dollar.”

    - Cr. Paul Freebody, Spence St, Cairns.

6. [6]
   The plaintiffs say that the words published on each occasion are capable of bearing certain defamatory meanings.

Issue for determination

7. [7]
   The real question for determination on this application is whether the material published is capable of giving rise to the defamatory imputations alleged. If it is not so capable, the pleading will be struck out as disclosing no cause of action. This is a question for the court to decide on this application. There are some other peripheral pleading points which were also argued and will be discussed. The decision to strike out “is not taken lightly but only, it has been said, with great caution”.^[5]That approach is to be coupled with the requirements of r 293(2) whereby a court should grant summary judgment only if the plaintiffs have no real prospect of succeeding on all or part of their claim and there is no need for a trial of the claim or part of the claim. Another test to be applied was referred to by Master Horton in Vasta v Queensland Newspapers Pty Ltd^[6]as it related to defamation cases as “…so obviously untenable that it cannot possibly succeed” or “manifestly groundless”.^[7]

Meaning of the words or imputations

8. [8]
   The plaintiffs say that the words published on each occasion by the first and then the second defendant were reasonable capable of conveying to the reader that:

1. (a)
   The Plaintiffs were fortunate to be successful in their appeal to the Racing Appeals Tribunal;

2. (b)
   The Plaintiffs executed false statutory declarations;

3. (c)
   The Plaintiffs were only successful upon their appeal because of some perception that the original penalty was too harsh;

4. (d)
   The Plaintiffs were knowingly involved in the “dishonest” activities of Mr O'Reilly;

5. (e)
   Racing in Far North Queensland is corrupt and the Plaintiffs were corrupt by association;

6. (f)
   The Four Win Syndicate Manager, Mr O'Reilly is corrupt and the Plaintiffs were corrupt by association.^[8]

9. [9]
   The plaintiffs rely on the natural and ordinary meaning of the words to found the imputations which they say are defamatory. Alternatively, the plaintiffs rely on extrinsic facts which also give rise to the implication which go beyond the words in their ordinary sense. For convenience, Mr. Jonsson who appears for the second defendant has provided a schedule of imputations with the appropriate references to the extrinsic facts.^[9]  

Tests to be applied

10. [10]
    A publication is defamatory if the words convey “any imputation concerning any person… by which the reputation of that person is likely to be injured or by which the person is likely to be injured in the persons profession or trade or by which other persons are likely to be induced to shun or avoid or ridicule or despise the person”^[10]Both plaintiffs were involved with the Cairns Jockey Club. Mr. Page as the vice-president and Mr. Lennon as its auditor.^[11]

11. [11]
    In Jones v Skelton^[12], the Privy Council said:

It is well settled that the question as to whether words which are complained of are capable of conveying a defamatory meaning is a question of law, and is therefore one calling for decision by the Court. If the words are so capable then it is a question for the jury to decide as to whether the words do, in fact, convey a defamatory meaning. In deciding whether words are capable of conveying a defamatory meaning the Court will reject those meanings which can only emerge as the product of some strained, or forced, or utterly unreasonable interpretation…The test of reasonableness guides and directs the Court in its function of deciding whether it is open to a jury in any particular case to hold that reasonable persons would understand the words complained of in a defamatory sense.^[13]

12. [12]
    Further in the joint judgment of Gleeson CJ, McHugh, Gummow and Heydon JJ. the High Court stated the following test:

In determining what reasonable persons could understand the words complained of to mean, the Court must keep in mind the statement of Lord Reid in Lewis v Daily Telegraph [1964] AC 234 at 258:

“The ordinary man does not live in an ivory tower and he is not inhibited by a knowledge of the rules of construction. So he can and does read between the lines in the light of his general knowledge and experience of wordly affairs.”^[14]

13. [13]
    The Court commented^[15]that each “alleged imputation is to be considered in the context of the entire article.”  The plaintiffs contend that when that approach is adopted that the imputations are defamatory.^[16]Reliance was also placed upon the passage from Amalgamated Television Pty Ltd v Marsden.^[17]

Parties’ submissions

14. [14]
    It is convenient to deal with the second defendant’s submissions^[18]in the first instance as the first defendant adopts^[19]those submissions and then adds another dimension of his own and also objects to parts of the pleading. The basic premise of the defendants’ arguments is that the words admittedly published are not reasonably capable of bearing the meanings complained of by the plaintiffs. The basis for that submission is that such meanings could only arise “out of a strained, forced or utterly unreasonable interpretation of the words published …according to its own natural and ordinary meaning, or within the context of extrinsic facts relied upon in support of the imputations concerned”.^[20]

Plain and natural meaning or natural and ordinary meaning

Paragraphs.. 4(a)(b) and 5(c) and (a)(b) and (c) of the Statement of Claim

15. [15]
    The second defendant refers to the plain and natural meaning of the words. It submits that the first three imputations,^[21]are inextricably linked. The first imputation by itself is not defamatory, it is submitted, unless it could be suggested that the phrase ‘because they had executed false statutory declarations’ is added. The third imputation arises it is submitted only if, in truth, the plaintiffs were guilty of the conduct alleged and were only successful because of a perception that the penalties imposed were too harsh.^[22]In fact, the defendants’ say that the reference to the ‘other good thing’ means that the author was referring to their acquittal as one good thing and the exposure of corruption as the other good thing. The plaintiffs answer this interpretation and say that a reasonable reader would be entitled to think that the first good thing being referred to was the exposure of the plaintiffs for their involvement in the affair.^[23]Mr. Favell^[24]contended that one would have to infer certain matters to understand the imputation contended for. He relied upon Farquhar v Bottom^[25]:

There are cases, of course, in which the refutation is of such a nature that, taken as a whole, the matter complained of is incapable of conveying the imputation refuted, for example, where the imputation arises by way of inference only and the matter complained of itself contains an express disclaimer of any intention to convey such an imputation: Stubbs Ltd v Russell [1913] AC 386 at 393; or where the refutation consists of a statement of fact, destructive of the entire basis upon which the imputation relies: Bik v Mirror Newspapers [1979] 2 NSWLR 679 at 682.

As pointed out such cases are rare.^[26]

16. [16]
    It was submitted by the plaintiffs that the use of the words ‘may’ in relation to the penalty and ‘maybe’ in relation to being caught up by association supports that view. In other words, the remainder of the publication is not rendered harmless.^[27]As Samuels JA said:

But I do not think that any purpose is really served by a scrupulous analysis of what was said. It is more a matter of impression, taking into account the attributes of the notional listener. I do not think that it can be said that the antidote so manifestly achieved its purpose that the issue should have been withdrawn from the jury.^[28]

17. [17]
    I agree with those observations. Once the conditional views of the first defendant were expressed in terms of ‘may’ and ‘maybe’, in the published letter to the editor, the “sting” of the words looking at the totality of the publications^[29]or the slight on their character had occurred, ‘for their part in false statutory declarations’. The link then to “the long investigation into corruption into the racing syndicates” “as another good thing” is clear.^[30]Looking at the context of the article as a whole and the reference to “(I)f you sleep with dogs you get fleas”, the words used and the imputations arising are capable of being defamatory. The first three imputations can stand, as adopting a cautious approach, it cannot be said that there are no real prospects of success or that the imputations suggested are so untenable they cannot succeed. The second defendant did not make reference to Mr. O'Reilly in the published letter to the editor, but that does not detract from the ruling in relation to the first three imputations. In fact, the second defendant changed the heading from “Racing Figures cleared” to “Two caught up by association”. On the other hand, the letter from the first defendant to the second defendant referred to the dishonesty of Mr. O'Reilly.

Plain and Natural Meaning

Paragraphs 4(c)(d) and (f) and 5(d)(e) and (f) of the Statement of Claim

18. [18]
    These are the more serious allegations. The plaintiffs suggest that the words used involve the plaintiffs being “knowingly involved in the dishonest activities” of Mr. O'Reilly.^[31]Further that racing in North Queensland was corrupt and that the plaintiffs were corrupt by association and that as Mr. O'Reilly was corrupt that the plaintiffs were corrupt by association.^[32]   When one looks at the letter published by the second defendant,^[33]an ordinary reasonable reader would be straining the meaning of those words to find such imputations. Nowhere in the publication does it allege that the plaintiffs are corrupt. In relation to the letter from the first defendant to the second defendant,^[34]different considerations apply. There is a reference to the fact that Mr. O'Reilly had been found to be a dishonest person. There is then reference to the saying “if you sleep with dogs you get fleas” and “I am sure they will be more selective of whom they associate with in the future”. Then the letter goes on to talk about the “other good things to come out of this long investigation in to corruption in the far north Qld Racing Syndicates”. There is no mention of the plaintiffs role in that aspect. It may be clearer looking at the extrinsic evidence but looking at the plain and natural meaning or what one writer describes as the “natural and ordinary meaning”,^[35]the words are not capable of defaming the plaintiffs. There is no suggestion that the plaintiffs were involved in any dishonest activities. Their part was limited to the false declarations. In fact the statement that they were caught up by association does not stand with the notion that they were knowingly concerned. An ordinary reasonable reader would be straining or forcing the meaning of words to find any imputations as alleged.

19. [19]
    Similar comments can be made in relation to the fifth and sixth imputations.^[36]The imputation is that the plaintiffs were corrupt by association with the Far North Racing and Mr. O'Reilly as manager of the Four Win Syndicate. The fact that the first defendant talks of the “other good things” in a positive way makes it difficult to find that there is somehow some connection between being guilty by association and being actively involved in corruption on both issues. It would be straining the meaning of the words to do so. The words used would not be capable of being found by a reasonable and ordinary reader to be defamatory.

Extrinsic evidence

20. [20]
    The proper approach if extrinsic evidence is to be relied upon is to be found in Gatley^[37]:

Where there is any unclarity as to the natural and ordinary meaning, or any uncertainty as to the meaning for which the plaintiff will contend at trial, or there is room for disagreement as to what inferences may reasonable be drawn, from the words themselves in light of the ordinary man’s knowledge, the plaintiff must plead the meaning which he alleges the words to have. If he does so he should make it clear that he is relying on the natural and ordinary meaning of the words, and is not seeking to plead a true innuendo without the support of extrinsic facts.

Paragraphs 4(a) and 5(a)

21. [21]
    The plaintiffs relied upon extrinsic evidence when asked for particulars in relation to paragraphs 4(a) and 5(a) as discussed above. The particulars referred to the article in the Cairns Post of 22 October 2004.^[38]In view of the finding that the plain and ordinary meaning of the words published by both defendants are capable of a defamatory meaning, it is probably unnecessary to deal with the extrinsic evidence argument. However, there may be cases where a plaintiff is not sure whether he or she should rely on the plain and ordinary meaning of the words complained or on a true innuendo. In other words, should the extrinsic evidence or facts be relied upon to show special knowledge or whether it is general knowledge.^[39]The learned author states that in practice the pleader can rely on both, but at the hearing, the legal innuendo can be dropped if there is a ruling that the matter is of general knowledge or if the other side agrees it is of general knowledge. The legal innuendo is only alleged where the plaintiff relies on any extrinsic facts.^[40]

In the present case, the defendants may be content at trial to allow the article about the plaintiffs being cleared of the charges^[41]to be before the jury, as it does assist their case. The case as pleaded relied upon the words being published “by way of innuendo”. It was argued by counsel for the plaintiffs that if the imputation is a false innuendo, then no extrinsic evidence is relevant. One would merely look at the letter to the editor^[42]or the published letter to the editor.^[43]The alternative case put is that some of them are true innuendos and so require “demonstration by the plaintiffs of extrinsic knowledge”^[44]The primary position of the plaintiffs is that extrinsic evidence is unnecessary as the matters pleaded are false innuendos.^[45]Given the ruling that the innuendos pleaded in paragraphs 4(a) and 5(a) could be understood in the context of the publication by a reasonable and ordinary reader as capable of being defamatory, it is unnecessary to deal with that issue further. Counsel for the plaintiffs did not really pursue the matter.^[46]

Paragraphs 4(d)(e) and (f) and 5(d)(e) and (f)

22. [22]
    In relation to each of these imputations, the plaintiffs would be required to rely upon extrinsic evidence as it has been decided that the plain and ordinary meaning of the publications^[47] are not capable of being found to be defamatory by a jury.

23. [23]
    The two pieces of extrinsic evidence are the articles in the Cairns Post being pages 1 and 2 published 7 May 2004^[48]and 22 October 2004 page 3.^[49]It seems that this later article is not relevant to paragraphs 4(e) and 5(e). The real relevance of the articles is that they introduce Mr. O'Reilly to the readers of the second defendant which had removed his name from the letter sent to the editor by the first defendant before publishing same. Armed with the extrinsic facts, are the imputations capable of being defamatory?

24. [24]
    The articles confirm that the plaintiffs were in some partnership or syndicate with Mr. O'Reilly who by this time is completely discredited as dishonest and banned from the Australian race tracks for 20 years. The involvement of Mr. O'Reilly is relevant to the question, it is argued by the plaintiffs, whether the publications are capable of defaming the plaintiffs. It is submitted that the fact that the article on 22 October 2004 exonerates the plaintiffs is irrelevant. It was argued that the readers of the second defendant are in a special class of persons who would know of Mr. O'Reilly because of the publication on 22 October and who subsequently read the letter to the editor on 26 October 2004.

25. [25]
    The defendants argue that in the article of 7 May 2004^[50]the second defendant reported the concession by the Racing Board that the plaintiffs were “effectively pawns in Mr. O'Reillys conniving game”. This it is argued effectively negates any suggestion that the plaintiffs were knowingly involved in Mr. O'Reilly’s activities.^[51]It was also reported that the plaintiffs had denied their involvement. Even the first defendant is reported as stating that the plaintiffs had “just got left holding the can”. Even with the assistance of the extrinsic evidence, it has not been established that either the letter to the editor or its amended publication by the second defendant was capable of conveying to an ordinary and reasonable reader that the plaintiffs were “knowingly” involved in the dishonest activities of Mr. O'Reilly.

26. [26]
    That leaves the fifth and sixth imputations.^[52]The defendants contend that the viability of these imputations depends upon the plaintiffs being “caught up by association” in corruption by the racing in Far North Queensland and the activities of Mr. O'Reilly. There is extrinsic material which points the finger of guilt at Mr. O'Reilly as being dishonest and that the Plaintiffs were “implicated in the dealings of two Cairns – based horse racing syndicates managed by Mr. O'Reilly. The defendants argue that the report refers to submissions made by the plaintiffs’ then solicitor that “they were found guilty by association due to their dealings”. In fact, the defendants argue that it is not alleged that the Far North Queensland Racing is corrupt in the publications but that there was an investigation into syndicates. One would have to infer that there was corruption in the racing industry and then a further inference that by association the plaintiffs were corrupt. It would be straining the meaning of what was said in 4(e) or 5(e) to so infer.

27. [27]
    It was submitted by the first defendant^[53]that the sixth imputation^[54]is a true imputation and required some extrinsic facts to make sense of it.  The “extrinsic fact does not mention corruption and adds nothing to the words used so as to be capable of giving rise to the pleaded imputation”. In relation to the publication reference is made to the fact that Mr. O'Reilly was the one involved and that he was convicted. The reference to the acquittal by the plaintiffs is referred to as is the statement by Mr. Page saying that the result “has proven our honesty and integrity”. It is urged by the first defendant^[55]that the court should look at the whole context in which the publication occurs and that the ordinary reasonable reader can draw inferences. That being the case, given that the plaintiffs own solicitor relied upon the guilt by association as a defence, it could be inferred by any reasonable and ordinary reader that because the plaintiffs have associated with a dishonest manager of a syndicate, it does not follow that they are corrupt. Once the extrinsic evidence is available, it is not open to find that the publications by the first and second defendants are reasonably capable of conveying the meaning as suggested in the sixth imputation.^[56]

Pleadings

28. [28]
    It is intended that paragraphs 4(d)(e)and(f) and 5(d)(e) and(f) be struck out to avoid any embarrassment at trial.^[57]The further submissions relating to pleadings should be seen in that context. The plaintiffs by their counsel conceded that there has been a failure to link the publication by the second defendant and the first defendant. There was also a concession about differentiating between false and true innuendos but given the ruling that may not be as important. It will be a matter for the plaintiffs.^[58]Mr. Favell suggested that paragraph 7 of the Statement of Claim was a nonsense. In so far as it purported to expand on paragraphs 4 and 5 there was some merit in that submission. However, the plaintiffs rely upon it in relation to aggravated damages. The plaintiffs will have to amend to spell out more clearly the damages aspect, including exemplary damages. Mr. Anderson for the plaintiff as much conceded that.^[59]

Costs

29. [29]
    The defendants were successful in part. The application was to strike out pleadings or parts thereof and for summary judgment. They failed on the latter point. They were partially successful on the former. In that event, the costs will awarded to the successful party on the hearing.

Orders

1. Paragraphs 4(d)(e) and (f) and 5(d)(e) and (f) of the Statement of Claim are struck out.
2. The plaintiffs are given leave to amend their pleadings as they may be advised in relation to matters other than those referred to in paragraph 1 of this order.
3. The application for summary judgment is dismissed.
4. Costs of this application will be costs in the cause.