Karzon v Pavlovic[2022] QDC 187

DISTRICT COURT OF QUEENSLAND

Introduction

1. [1]
   The plaintiff owns three lots in a commercial community titles scheme known as Broadwater Plaza situated at Hope Island on the Gold Coast (“the scheme”).  He is also the chairperson of the body corporate for the scheme. 
2. [2]
   The second defendant, Wandulla Pty Ltd, owns two lots in the scheme.  Mr Richard Kaucic is a director of the second defendant.  The first defendant is Mr Kaucic’s daughter and is also a committee member of the body corporate as a nominee of the second defendant.
3. [3]
   The first defendant published two emails in September 2018 which are claimed to be defamatory of the plaintiff.  The plaintiff claims that the second defendant is as responsible for that publication as the first defendant as author.  Until closing submissions, it was disputed that the first defendant published the statements within the scope of her authority as nominee.  However, that issue has now been conceded and it is not necessary to consider it further. 

The issues for determination

4. [4]
   The issues remaining in dispute between the parties are:

   1. (a)
      what meaning ought to be attributed to the statements published by the defendants;
   2. (b)
      whether a defence of qualified privilege arises in respect of matters which might be defamatory of the plaintiff;
   3. (c)
      the appropriate measure of damages;
   4. (d)
      whether injunctions should be ordered.

The evidence

5. [5]
   There was little dispute about most of the evidence during the trial.  For example, the plaintiff (and a number of witnesses called by him) gave evidence as to the hurt to Mr Karzon following the publication.  None of this evidence was challenged.  There was much evidence as to what the defendants regarded as petty issues taken by the body corporate (lead by Mr Karzon) in relation to their use of their lots.  There was evidence as to litigation concerning this.  Again, there was no real issue with any of this.  While at first it may seem necessary to decide whether this was petty or justified or whether it was a mix of the two, the issue seems to me to matter little in terms of the determination of this matter.  What is probably most significant about this issue is that the defendants clearly strongly considered it to be petty, whether that was right or wrong.  The defendants’ perception as to being unfairly targeted could be relevant as a factor motivating the publications.  I consider this further below. 
6. [6]
   Given that most of the evidence was uncontroversial it is enough to record some aspects relevant to matters I consider further below and my impression of the witnesses. 

George Karzon

7. [7]
   The plaintiff gave evidence:

   1. (a)
      that he owned two lots at the Broadwater Plaza at Hope Island, one of which was leased to a Thai massage shop;
   2. (b)
      that he was voted chairperson of the body corporate over Mr Kaucic for the Broadwater Plaza at Hope Island at the AGM on 27 April 2017. At this meeting, there was heated discussion as to suggested misuse by the second defendant of common property for food trucks and a car wash. Proceedings were brought regarding this;
   3. (c)
      that there was a conversation between he and Mr Kaucic after the 2017 AGM where Mr Kaucic said that he thought that the Thai massage business was a brothel.  Mr Kaucic said that some woman had said her husband was offered some kind of sexual service there.  Mr Karzon’s view at the time was that he knew that this matter was false and that Mr Kaucic was making it up.  In his mind it was clearly untrue.  It followed the heated discussion at the AGM as to the activities of the second defendant to which I have already referred.  That matter caused friction between Mr Kaucic and the rest of the committee.  Mr Karzon considered that if there was any genuine concern it would have been raised at the AGM rather than after it or reported to the police;
   4. (d)
      that after the first email, he felt hurt, distress and embarrassment. It made him anxious just reading it. He regarded it as very dirty and disgusting;
   5. (e)
      as to the importance to him of his reputation and his business ethics.  He said that the attack on his integrity was painful as he had always conducted his business well above board.  He also stated that he was not aware of any criminal activity or involvement from QPS in relation to the massage parlour and that he made his own enquiries with the Coomera police station;
   6. (f)
      about the apology from Ms Hachem, and that while he felt relief after receiving it, he still felt a cloud knowing that people had been given the wrong impression about his character and who he was as a person;
   7. (g)
      describing the impact upon him of the second email.  He said that it was a lot more painful to read coming as it did after Ms Hachem’s apology and statement that she had contacted the police, there had been no raid and they were not aware of any illegal activity from this particular tenancy. He also spoke about the further allegations that were made about him and that they were made to sound like fact or truth;
   8. (h)
      that he had not received an apology from the defendants;
   9. (i)
      that when the emails were sent the tenancy had been vacant for about 2 weeks since the tenants had vacated the premises at the end of their lease;
   10. (j)
       when describing the effect upon him, that he was impacted every day in his interactions with family, business and friends and he was affected by what he saw as a direct personal attack on his character and integrity.  This was aggravated in his mind by it taking four years for the defendants to get to the point that they abandoned the allegation that these matters were true. 
8. [8]
   Mr Karzon impressed me as an honest and reliable witness doing his best to give accurate evidence.  In particular, I am satisfied that he accurately described the effect upon him of the publication of the two emails.  I also note in this respect that his evidence was unchallenged.

Karen Burtenshaw

9. [9]
   Ms Burtenshaw is the plaintiff’s de facto partner.
10. [10]
    She gave evidence:

    1. (a)
       that she had known the applicant since 2014 and that they commenced a romantic relationship in 2017;
    2. (b)
       about the effect these emails had on Mr Karzon;
    3. (c)
       to the effect that she noticed a change in the plaintiff’s behaviour at the time the emails were sent.  He was angry and upset. She observed that it was like a weight had been put on him which wasn’t there before. She said that he would stress and worry about what people were thinking and perceiving about him in both a business and personal context;
    4. (d)
       that the plaintiff became withdrawn from life, especially in their relationship. He would not be engaged in conversations. She also spoke about his difficulties with sleeping since this occurred.  She referred in this context to him drinking more alcohol than he used to.  They used to have a glass of wine together.  Now he has a vodka or two before he goes to bed. She also spoke about the migraines that the defendant has been getting.
11. [11]
    In common with all of the witnesses called for the plaintiff, she confirmed that her opinion of the plaintiff did not change because of the emails.  She, together with other witnesses, could not identify any other matter occurring in the plaintiff’s life which might have explained the changes they observed in him.  Her evidence, like that of the other witnesses called on this issue, was uncontroversial and I accept it. 

Carl von Saldern

12. [12]
    Mr von Saldern gave evidence that:

    1. (a)
       he had known the plaintiff for about 8 years. They met when crossing paths on early morning walks and have since become good friends. He described the plaintiff as being a happy man. In 2018, he noticed some distance in their relationship and that the plaintiff was becoming withdrawn. When he asked the plaintiff if he was okay, he opened up about the allegations. He observed that the plaintiff began to break down emotionally and that he was angry and frustrated;
    2. (b)
       he attended the 2017 AGM but did not recall the matter of sexual services being provided from the massage shop arising.

Robert Hill

13. [13]
    Mr Hill gave evidence that:

    1. (a)
       he met Mr Karzon in mid-2013. They crossed paths while walking and became very good friends. Mr Hill introduced him to a friendship group that he is part of who would meet regularly;
    2. (b)
       the group of friends at these social gatherings liked the plaintiff very much and thought that he was a kind and generous person. The plaintiff’s involvement in the group changed during 2018.  He stopped coming down to the gatherings, was moody and not his normal self. Others began to ask why the plaintiff was not at the gatherings and he and others became concerned. Mr Hill went to see the plaintiff to ask what was wrong, and the plaintiff told him about the accusations that were made about him running a brothel. 

Jill Eisenhuth

14. [14]
    Ms Eisenhuth met the plaintiff about 8 or 9 years ago while working at Raine & Horne.  She managed the plaintiff’s residential properties. She gave evidence to the effect that the plaintiff was known to the tenants who found him to be very honest and respectful and that they trusted him in their home.

John Corby

15. [15]
    Mr Corby manages the plaintiff’s commercial properties, including the lots in the scheme. He gave evidence:

    1. (a)
       as to what his role involved which was not controversial.  He described the plaintiff as taking a hands-off approach and leaving matters to him;
    2. (b)
       that he was also a nominee on the body corporate for the plaintiff and started in that position in 2018 or 2019;
    3. (c)
       that he had never heard a suggestion or seen anything that would alert him to the Thai massage parlour being operated as a brothel; 
    4. (d)
       that he observed since becoming aware of the accusations that the plaintiff’s general demeanour had changed quite considerably.  He was withdrawn and he was not the happy man he had earlier met. He said the plaintiff was so distressed over the matter that he wanted to sell the properties. He was not aware of anything else in the plaintiff’s life that could have impacted him in this way.

Martin Pettit

16. [16]
    Mr Pettit owned a lot at the Broadwater Plaza for about 7-8 years before he sold it in September 2017. He gave evidence that:

    1. (a)
       he attended the 2017 AGM meeting as chairperson, and that there was no mention in his presence about rumours as to the Thai massage tenancy being used as a brothel;
    2. (b)
       he continued to stay in touch with the plaintiff after he left the body corporate. He said that following the emails the plaintiff was not the same bubbly person and was deeply stressed and changed.

Luke Cini

17. [17]
    Mr Cini gave evidence that he met the plaintiff during his walks along the Broadwater. They would meet up every few weeks. In late 2018, Mr Cini observed a change in the plaintiff’s demeanour, and he became not as involved, more reclusive and they did not catch up as much. He said that in late 2018 he had a few conversations with the plaintiff where he opened up about being accused of running a brothel.

Renee Pavlovic

18. [18]
    Ms Pavlovic has worked at the Freedom Fuel Service Station at the Broadwater Plaza, her family’s business, since she was a teenager.
19. [19]
    She gave evidence that she attended the 2017 AGM meeting as a nominee on behalf of Wandulla. She said that after the meeting, but while the attendees were still at the boardroom table, Mr Kaucic brought up in the general discussion component that there was a lot of talk going around to the effect that it was common knowledge that the massage shop was offering sexual services. She said that the plaintiff acknowledged and laughed at the comment. Ms Blinco asked the plaintiff to look into the matter because she said it could have had implications on the insurance. She said that the plaintiff confirmed that he would have a look into it. She agreed that the basis of the assertion in her email that the plaintiff had full knowledge of the illegal activities was limited to this one occasion that her father raised a rumour with him at the AGM 16 months before the emails were sent.^[1]
20. [20]
    She gave evidence that she had heard gossip and rumours from customers, staff, other tenants, friends and her brother, which caused Mr Kaucic to raise the matter at the AGM. She said that since the AGM but before she sent the first email she heard over 50 stories from people about their experiences with the services offered at the Thai massage parlour. She said that her brother told her that police had attended the Thai massage shop. She also gave evidence of google searches she conducted in relation to the phone number displayed on the sign at the front of the shop. She said that the results included webpages with ‘Locanto’, and wording including “beautiful, hot young Thai girls”, and “get a happy ending”.
21. [21]
    She gave evidence of an event that stood out to her, about two or three weeks before sending the emails. She said that she had “copped an absolute mouthful” from one of the petrol station’s regular customers who said that her husband, while receiving a massage, was propositioned for sex.  She said the customer accused her of knowing what was going on. She said this was quite embarrassing as customers and other staff members were there.
22. [22]
    She gave evidence that she sent the emails with good intentions and for the reputation of the plaza.^[2]
23. [23]
    Ms Pavlovic gave evidence about the choice of words she used in the emails. She accepted that they were not gentle or refined, and that they were inappropriate. Mr Anderson QC who appeared for the plaintiff extracted a number of apologies from Ms Pavlovic in relation to the wording of the emails including the mention of the police raid and the absence of research.^[3] Ultimately, towards the end of her evidence she offered an apology about the false allegations, stating that the allegations she made were incorrect,^[4] that she should not have sent the emails^[5] and for maintaining that the allegations were true until the morning of trial.^[6] She maintained that the emails were not spiteful,^[7] but conceded that they could be perceived as spiteful when reading them for the first time.^[8]
24. [24]
    I found Ms Pavlovic to be a witness keen to justify her behaviour in sending the emails.  The only aspect of her evidence that could really be regarded as controversial is her statement that she had good intentions when sending the emails.  I consider that evidence to be completely at odds with the matters I set out below as to the surrounding objective circumstances in which the emails were sent and I do not accept it.  I consider it to also be inconsistent with the language chosen in the emails themselves and the reference to the plaintiff as being petty and interfering. 

Mr Kaucic

25. [25]
    Mr Kaucic has been a director of Wandulla for about 20 years. He said that Ms Pavlovic is a body corporate committee nominee of Wandulla and had been for about seven or eight years and that she was nominated as a “voting person”.^[9]  He gave evidence that at the 2017 AGM he raised in general discussion a number of complaints received about sexual services being offered from one of the plaintiff’s shops.  He said that the plaintiff laughed about it. Ms Blinco indicated to the plaintiff that if it were true, it would impact the corporate insurance and the plaintiff said to leave it with him and he would look into it.
26. [26]
    He also gave evidence about another email by Ms Pavlovic on 5 June 2017.^[10] He said he did not draft or authorise Ms Pavlovic’s response and would not have permitted it to be sent had he seen it beforehand. He said he told Ms Pavlovic that she should not have sent the emails without seeing him and that she should ‘go through’ him before sending anything that implicates Wandulla. He agreed that he did not take away her authority to act on behalf of Wandulla, including after the two emails the subject of this proceeding were sent.^[11]
27. [27]
    It was also clear from his evidence that he regarded the complaints by the plaintiff and other members of the body corporate as being petty.

Ms Blinco

28. [28]
    Ms Blinco worked at Body Corporate Services as a strata manager and was the manager for the scheme. She gave evidence that she attended the 2017 AGM but did not remember anything that was discussed at the meeting.

The first matter complained of

29. [29]
    At about 11.18 am on Friday 7 September 2018, Ms Pavlovic published an email to the body corporate managers (by Bridget Blinco), her father, her brother (Mark Kaucic) and a solicitor (Doug McClelland) with the subject “George’s Illegal Brothel” (“the first matter complained of”).^[12]  That email was forwarded by Ms Blinco to members of the body corporate committee at about 1.50 pm on the same day.
30. [30]
    Ms Pavlovic’s email was as follows:

“Subject: FW: George’s Illegal Brothel

Good Morning,

It would appear that George’s massage parlour located in Broadwater Plaza was in fact an illegal brothel! Now we discussed this at an earlier body corporate meeting and aired our concerns for the gossip filtering around. George told the body corporate that he would act promptly into these allegations and take an appropriate course of action. Bridget agreed that George would need to attend to the matter. However it seems that no attention was to this matter and police have raided the premises and closed the illegal brothel down !!!! This is absolutely humiliating to be associated with such a filthy and dishonourable business. The embarrassment of being questioned by customers who now think we are some how supportive of this type of misconduct due to us being situated in the same complex is offensive. Why was no course of action perused by the body corporate? We receive formal letters and demands for the most minor issues such as holes in a pole or cars being parked incorrectly yet an illegal sex trade being conducted from our precious complex which George is so passionate about protecting was not a priority or even worth a follow up???

George is the owner of this shop and he is also the chair man for the body corporate he had full knowledge of this illegal trade. We have since found advertisements in local sex operator pages online which clearly state what this business was all about. George has acted dishonourably to cover up what he has been doing by supporting and receiving money from these CRIMINAL OFFENDERS. The body Corporate also has been negligent as Bridget Blinco was made aware of the alleged sex trade occurring out of George’s shop and yet no actions were taken to ensure that the misconduct would be ceased immediately.

Were there any formal letters written to George to put him on notice such as, the frequent letters sent to us?

This has proven the body corporate to be incompetent and unsuitable to act as a impartial and professional Body Corporate Service to our plaza.

Both Bridget and George had a responsibility and duty of care in their roles to act diligently and in the best interest of all shop owners. This has been the case and therefore both of you should consider resigning from your roles to allow competent members to take over.

I await your response.

The Premier Group

Renee Pavlovic

Ph: 1300858856” 

(My underlining.  Errors in original.)

31. [31]
    After the first matter complained of was sent Ms Pavlovic emailed again at about 1.57 pm on 7 September 2018^[13] (as part of the same chain) imploring the committee to take seriously the first matter complained of which had been forwarded to them by Ms Blinco about 7 minutes earlier saying the following:

“This is an extremely serious matter committee … we are making further enquiries with QPS regarding the alleged charges to follow and will be taking further action as we in no condone this type of criminal activity. We request that all committees members including the chairman tender their resignation forthwith.”

(My underlining.  Errors and spacing as per original.)

32. [32]
    At about 8.37 am on Saturday 8 September 2018, Ms Hachem, one of the committee members, added fuel to the fire (at least at this stage) saying the following:^[14]

“Without Prejudice

Dear Bridget and fellow Committee Members,

Thank you Renee for being forthright and keeping us up to date on what is happening.

You are there all the time and I am thankful for this.

In my opinion, this situation is going to have an adverse effect on all of our businesses.

There is a Child Care Centre very close to the complex, negative advertising travels fast.

Illegal activity of any sort usually attracts other illegal activities, to attract this kind of traffic into the complex is damaging.

People become scared and they stay away.

I am extremely disappointed in the Management of Body Corporate Services. The issue about some of us paying fees and others not paying fees is ridiculous. We are not getting this addressed and I ask that you push the solicitors for their brief.

Bridgette, if you knew there was a Brothel being conducted out of one of the shops why did you not dealt with it?

You must always have a bipartisan approach to all members.

I would like a Senior Manager of Body Corporate Services review our file as a matter of urgency. I do believe that Bridgette is not the right person to continue as our Strata Manager.

At the next meeting, I would like to change Strata Managers. I know of a very good company who I would recommend if the other members agree.

George, you as Chairman should do the right thing by the other owners and step down.

I am very disappointed that you as Chairman, did not address this issue with the urgency and gusto that you have previously displayed.

This Brothel was conducted out of your premises.

George, take a deep breath and inhale some decency and do the right thing.

Yours faithfully,

Laila Hachem”.

(My underlining.  Errors in original.)

33. [33]
    At about 8.08 am on Wednesday 12 September 2018, the plaintiff responded to Ms Pavlovic and Ms Hachem in terms which made clear his denial of the matters raised by them:^[15]

“Laila and Renee,

I refer to your comments regarding the Thai massage tenancy.

I deny any knowledge of any wrongdoing.

I deny acting unlawfully at any time.

I am unaware of any police raid.

I put you on notice that the comments you have both made are highly defamatory and demand that you immediately cease making them or anything similar to them.

I am currently seeking legal advice and intend to seek very significant damages from both of you for your highly defamatory comments.

A formal legal demand or legal proceedings will shortly follow.

King Regards

George Karzon

PO Box 135

Biggera Waters, Qld 4216

Mob: 0490 068 396”.

34. [34]
    About an hour and a half later, at about 9.25 am on 12 September 2018, Ms Hachem responded to the plaintiff’s email:^[16]

“Without Prejudice,

Thank you for your email.

I have just phoned Hope Island Police for clarification and you are correct.

They did not raid the place, it is not listed in their books. They have absolutely no knowledge any illegal activity.

When I make a mistake I own up to it. I should have made the call before I re-acted.

I owe you an apology George. If you don’t accept it, I completely understand.

King regards

Laila Hachem”.

(Emphasis in original)

The second matter complained of

35. [35]
    Instead of taking Ms Hachem’s lead and making some enquiry or pausing to consider the issues, Ms Pavlovic responded to Ms Hachem’s email and the plaintiff’s earlier email in the following terms:^[17]

“George,

You are more then welcome to deny any allegations of wrong doing and I wouldn’t have expected anything less!

Irrespective of weather there is any truth to the rumours circulating of a raid taking place the fact still stands that this business was offering sexual services for an exchange of money.

In the state of QLD this is illegal if you don’t hold a license to operate a brothel.

We have every right to be concerned and appalled at this, as we are the ones who are dealing with the ramifications of disgusted customers questioning our integrity and knowledge of this illegal business.

You have invested so much of your own personal time checking every detail of our business was being operated above board and that we held all the relevant licenses etc … yet you claim negligence to knowing what was taking place in ur own ???

Did you take any course of action to investigate the claims bought to your and the body corporate’s attention at the agm??

Are you aware of any license held to operate as a massage parlour??

Are you in fact the owner of the massage parlour?

Are you aware of a license to operate a brothel?

Did you have a lease agreement with these tenants??

Why have you so strongly objected to the presence of our surveillance cameras being used to provide security to the complex? This benefits all of us, not one other owner was disputing the cameras other then urself … there must be a logical answer as to why u are so adamant to have them removed and provide complete privacy to the complex???

You are welcome to once again seek legal advice it sounds like you will need it.

You can be assured we will b taking this batter further.

Look forward to your response

Renee pavlovic”

(My underlining.  Errors in original.)

36. [36]
    In the almost four years that have passed since these matters were published neither defendant had apologised or sought to retract anything that was said.  As is noted in submissions on behalf of the plaintiff, the position is in fact quite to the contrary.  That is, the proceeding has been defended on the basis that the substance of the imputations is true.  That defence was only abandoned on the morning of the commencement of the trial in this matter.  For the reasons that appear below under the heading “The continuing relevance of the abandoned truth defence”, in my view, that defence was doomed to fail.

The pleaded imputations

37. [37]
    The first matter complained of is pleaded^[18] to mean and to be understood to mean that the plaintiff:

2. “(a)
   ran an illegal brothel from premises he owns;

2. (b)
   in the alternative to (a), is the owner of the shop from which he knew an illegal brothel operated;

3. (c)
   conducted an illegal sex trade from premises he owns;

4. (d)
   in the alternative to (c), is the owner of a shop from which he knew an illegal sex trade was being conducted;

5. (e)
   is a dishonourable person who sought to cover up illegal activities that were being run from premises he owns;

6. (f)
   is a person who knowingly supports and receives money from criminal offenders.”

38. [38]
    The second matter complained^[19] of is alleged to mean and to be understood to mean that the plaintiff:

2. “(a)
   is a liar in that he made false denials when confronted with allegations of wrongdoing;

2. (b)
   ran an illegal business that was offering sexual services for an exchange of money;

3. (c)
   in the alternative to (b), leased premises to a tenant who he knew was running an illegal business that was offering sexual services for an exchange of money.”

39. [39]
    As to the first matter complained of, in closing submissions it was conceded by the defendants that the meanings pleaded in (b) and (e) arise on the face of exhibit 1.  However, the defendants deny that the imputation in (a) arises, deny that the imputation in (c) arises (really for the same reasons as they deny that pleaded in (a)) and submit that the pleaded imputation in (d) is not in terms which are different in substance from those in (b) and that the imputation pleaded in (f) is not different in substance to the imputation arising from (e).
40. [40]
    There is no dispute as to the relevant principles for establishing whether a publication is defamatory.^[20]
41. [41]
    The court must consider the meaning of the words used from the point of view of what an ordinary reasonable reader might understand from the matter complained of.
42. [42]
    The plaintiff submits that the imputations pleaded in (a) and (c) arise as well as those in (e) and (f) but that if the primary meanings do not arise (that is, that those in (a) and (c)) then those in (b) and (d) are inevitable alternatives.  As I have indicated the defendants concede that the first alternative arises but say that that in (d) is not different in substance.
43. [43]
    I generally accept the submissions of the plaintiff^[21] as to the meanings to be attributed to the words.  However, in my view, on a consideration of the whole of the text of the first matter complained a reasonable reader would consider that it was being said that the plaintiff was the owner of the premises and knew that an illegal brothel was being operated or knew that an illegal sex trade was being conducted rather than that he ran an illegal brothel or conducted an illegal sex trade.  In particular, I consider the allegations of knowledge to be more consistent with being the owner of the premises from which the business was operated rather than himself running it.
44. [44]
    I do not accept the submission on behalf of the defendants that there is no difference in substance between (b) and (d).  In my view, an ordinary reasonable reader of the first matter complained of may well understand the concept of an illegal brothel being different from premises from which an illegal sex trade was conducted.  In any case, it seems to me difficult for defendants, who have chosen to adopt different language in this respect, to contend that they are not capable of conveying something that is different in substance from the other form of words chosen.
45. [45]
    Similarly, I prefer the submissions on behalf of the plaintiff regarding (e) and (f).  That is, these two matters are part of the natural language of the first matter complained of rather than being some cleverly derived meaning sought to be drawn from it. 
46. [46]
    In summary then as to the first matter complained of, I find that the imputations pleaded in (b), (d), (e) and (f) arise. 
47. [47]
    I also accept the plaintiff’s submission that it is inconceivable that the meanings would not be defamatory.  Nothing of that kind was contended on behalf of the defendants.
48. [48]
    As I have set out above, there were a number of further emails following the first matter complained of.  The second matter complained of followed all of those.  In my view, this is an important feature in terms of the context in which the second matter complained of arose.  It also has some significance as to the potential availability of a defence and as to damages.  These matters are considered below.
49. [49]
    As to the second matter complained of, the plaintiff submits that it is clear that the first defendant asserts that the plaintiff was lying in his denial of wrongdoing (which was contained in his email of 12 September 2018).  On behalf of the defendants, it is submitted that it is a serious thing to say that someone has directly accused someone of being a liar and the words do reach that level. 
50. [50]
    In my view, a clear imputation arises that the plaintiff is a liar in that he made false denials when confronted with allegations of wrongdoing.  The context in which the email was sent and that statement made cannot be ignored.  It came after the original statements of the defendants in the first email, Ms Hachem’s statement, the plaintiff’s denial and immediately after Ms Hachem’s retraction and statement as to the lack of any police interest.  Proper account needs to be taken of the nature of the first sentence of the email.  I do not regard it as being in any way a genuine suggestion that the plaintiff is rightfully entitled to reject the accusations made.  The email, like its predecessor, is dripping with sarcasm.  Far from inviting any denial of the matter by the plaintiff, the emails reject any sensible possibility of that and call for his resignation. 
51. [51]
    I also accept that the references at the end as to the need for a lawyer and an assurance that the defendants would be taking the matter further serve to reinforce that meaning and the sarcastic reference to the plaintiff effectively lying in respect of any denial he may wish to make.
52. [52]
    For similar reasons to those I have expressed for finding that the imputations in paragraph 5(a) and 5(c) of the statement of claim did not arise, I do not consider that in 7(b) arises but rather find that the alternative imputation in subparagraph 7(c) does arise.  The source of this imputation is the clear words of the email.  Those words are similar to the words contained in the first matter complained of but are different and relate specifically to the words of the second email.  In any case, part of the context by this stage is the plaintiff’s denial and each of Ms Hachem’s emails.  I do not accept the submission for the defendants that the difference in wording as to the offering of sexual services between the first matter complained of and the second matter complained of were such that an imputation wouldn’t arise on a fair reading of the second matter complained of. 

The continuing relevance of the abandoned truth defence

53. [53]
    Before turning to the issue of qualified privilege, I should say something as to the continuing significance of the abandoned defence of justification.
54. [54]
    In order to have proved the substantial truth of the imputations I have found, the defendants would have been required to prove the existence of an illegal brothel or some form of illegal sex related business and that the plaintiff knew it was being operated.  I accept the submissions made about these matters in the plaintiff’s written submissions at paragraphs 22-24.  In addition to accepting the criticisms as to the lack of evidence that sexual services were being offered from the premises, I accept that there was no evidential basis exposed in the summaries of evidence that could have supported a finding that the plaintiff held any relevant knowledge. 

Qualified privilege

Common Law

55. [55]
    Again, in relation to the topic of qualified privilege, there was no real controversy between the parties as to the appropriate principles.^[22]
56. [56]
    In the judgment of Gleeson CJ, Hayne and Heydon JJ in Bashford v Information Australia (Newsletters) Pty Ltd^[23] the following was said:

“The principles to be applied in determining whether the occasion of publication of matter about which complaint is made was an occasion of qualified privilege are well known.  The authorities that state those principles are equally well known^[8].  Frequent reference is made to the statement of Parke B in Toogood v Spyring:

‘In general, an action lies for the malicious publication of statements which are false in fact, and injurious to the character of another (within the well‑known limits as to verbal slander), and the law considers such publication as malicious, unless it is fairly made by a person in the discharge of some public or private duty, whether legal or moral, or in the conduct of his own affairs, in matters where his interest is concerned.  In such cases, the occasion prevents the inference of malice, which the law draws from unauthorized communications, and affords a qualified defence depending upon the absence of actual malice.  If fairly warranted by any reasonable occasion or exigency, and honestly made, such communications are protected for the common convenience and welfare of society; and the law has not restricted the right to make them within any narrow limits.’

Reciprocity of duty or interest is essential.

These principles are stated at a very high level of abstraction and generality.  "The difficulty lies in applying the law to the circumstances of the particular case under consideration"^[11].  Concepts which are expressed as "public or private duty, whether legal or moral"^[12] and "the common convenience and welfare of society"^[13] are evidently difficult of application.  When it is recognised, as it must be, that "the circumstances that constitute a privileged occasion can themselves never be catalogued and rendered exact"^[14], it is clear that in order to apply the principles, a court must "make a close scrutiny of the circumstances of the case, of the situation of the parties, of the relations of all concerned and of the events leading up to and surrounding the publication.”

(Footnotes omitted)

57. [57]
    I accept the submission made for the plaintiff based on Bashford that the principles are stated at a very high level of abstraction and generality and the difficulty arises in applying them to any particular set of circumstances.^[24]
58. [58]
    Similarly, the discussion in De Kauwe v Cohen (No. 4)^[25] is of considerable assistance.  Care is needed to define the occasion of potential qualified privilege.     
59. [59]
    In addition, as McHugh J said in Bashford in the passages extracted in the plaintiff’s written submissions at paragraphs 29 and 30, the considerations in a case where a defendant volunteers a statement are different from those where an enquiry is answered.^[26]  In essence, the concept of common convenience and the welfare of society is much more difficult to find in respect of volunteered statements such that there is an absence of any advantage^[27] in affording a defence of qualified privilege in respect of such a statement.
60. [60]
    The plaintiff submits that careful consideration of the events leading up to and surrounding these publications, indicate an absence of common interest or any duty in the first defendant whether legal, moral, or social, in part at least, because the premises has been vacated prior to the first matter complained of.  In this respect, the “matter” was identified in evidence as being the interests of the body corporate committee members in this matter partly because of the insurance implications of such a business being run from the premises and partly from a reputational point of view.  However, the premises were vacant.  In this respect, the plaintiff submits:

“Whatever might be said about the need for a free flow of information between body corporate members about matters relating to the body corporate premises, the recipients of the matters complained of did not share an interest with the defendants in knowing about what had been alleged in relation to a premises that was now vacant.”^[28]

61. [61]
    It is plain from the authorities that it is not enough to find a relevant privileged occasion to observe that there are communications between members of a body corporate committee.^[29]  While communications between body corporate members or company directors may, depending on the circumstances, be found to be made on an occasion of qualified privilege, the question as to whether that is so will depend upon a careful analysis of the facts rather than focus upon the relationship.
62. [62]
    Here, the premises were vacant such that there could not be any serious continuing concern as to reputational damage much less insurance issues.  Further, the statements were volunteered and they were volunteered where on an earlier occasion the rumour had been communicated between at least some of the same people.  There was no purported communication of the rumour at this later time but instead baseless assertions of fact.  In any case, it would have been clearly unnecessary to raise the rumour again in any sense which might render the occasion one of qualified privilege.
63. [63]
    I do not consider that the occasion was such as to give rise to the defence.  In my view, what occurred in the current circumstances is that the first defendant published highly defamatory statements in circumstances where there was no reciprocity of interest between her and the recipients.    

Malice 

64. [64]
    Further, in my view, the communication was sought to be used for the dominant and improper purpose of defaming the plaintiff.^[30]  While the existence of an improper motive or purpose “must not be confused with a defendant’s ill will, knowledge of falsity, recklessness, lack of belief in the defamatory statement, bias, prejudice or any other motive other than duty or interest for making the publication”, the existence of these matters, if proved, usually provides a basis for inferring that the publication was actuated by an improper motive.^[31] 
65. [65]
    Despite being conscious of the serious nature of such a finding,^[32] I am satisfied that the statements were made for the dominant and improper purpose of defaming the plaintiff in circumstances where:

    1. (a)
       the first defendant made no attempt to satisfy herself for the truth of any of the rumours upon which she chose to base her assertions of fact;
    2. (b)
       the language used by her could appropriately be described as dripping with sarcasm and spiteful.  In my view, it clearly sought to ridicule and embarrass rather than to inform;
    3. (c)
       the communication was not the result of some legitimate inquiry or a response to a legitimate body corporate matter – it was voluntary and spontaneous.  This is especially so when it is remembered that the rumours had been communicated to the plaintiff and other body corporate committee members earlier at the AGM;
    4. (d)
       the matters complained of were sent when there was a dispute between the first defendant’s family business and the body corporate, the committee of which was led by the plaintiff as to matters that the first defendant clearly regarded as petty;^[33]
    5. (e)
       the matters of complaint were, as conceded by the first defendant, published when she was being “hot headed”^[34] and in circumstances where she was “driven by emotion”.^[35] She was angry and explained that she was not responding well to a lot of things in her life at the time;
    6. (f)
       she failed to retract the imputations or apologise for nearly four years;
    7. (g)
       that failure to retract the imputations or apologise and in fact the publication itself occurred despite the more appropriate approach of Ms Hachem who had made some enquiry and then apologised;^[36]
    8. (h)
       an unjustifiable truth defence was run and only abandoned on the first day of the trial. 

Statutory defence?

66. [66]
    In order to establish the defence under s 30 of the Defamation Act 2005 (Qld) (“the Act”), a defendant must prove that the recipient has an interest or apparent interest, that the matter is published to the recipient in the course of giving a recipient information on that subject and the conduct of the defendant in publishing the matter is reasonable in the circumstances.  As will be apparent from what I have said in relation to finding the common law privilege was not available, I do not consider that there was a relevant interest or that the matter was published to the recipients in the course of giving information on that subject.  The additional hurdle in relation to the statutory privilege is the need to show that the conduct was reasonable.  Subsection 30(3) of the Act sets out matters which the court may take into account in determining this issue. 
67. [67]
    It was candidly and appropriately accepted by Mr Coveney who appeared for the defendants that the requirement of reasonableness added a significant additional hurdle. 
68. [68]
    In terms of the ss 30(3) factors:

    1. (a)
       the imputations are serious: (ss 3(c));
    2. (b)
       the published matters do not distinguish between suspicions and proven facts, but instead, treat what are at best suspicions as proven fact: (ss 3(d));
    3. (c)
       the sources were second and third hand hearsay and there was no underlying basis for the imputation that the plaintiff knew of the alleged illegal activities at the tenancy at all: (ss(g)).
69. [69]
    In any case, given the finding I have made as to malice, any defence which might have been afforded under ss 30(1) of the Act is defeated: (see ss 30(4)). 

Damages

70. [70]
    By his statement of claim the plaintiff claimed general compensatory damages in the sum of $150,000 and aggravated compensatory damages in the amount of $50,000 to reflect the additional hurt alleged to be suffered by reason of the matters pleaded in paragraph 10 of the statement of claim.
71. [71]
    In the plaintiff’s written submissions, the sum of $120,000 is sought for general compensatory damages.^[37]  Further, it is submitted by the plaintiff that there ought to be an award of aggravated damages and that the component of aggravation further justifies the amount of $120,000 sought.^[38]  The plaintiff submits that the mitigating effect of the apology and damages paid by Ms Hachem of $5,000 ought to have a negligible effect.  In this respect, it is submitted that what she had said was to a different effect such that any compensation was not for the same or a similar defamation.^[39]  The defendants submit that the range of appropriate award does not exceed $30,000 including any aggravated damages.^[40]  The defendants made no submissions directed specifically to Ms Hachem’s apology and payment.  I accept that it is of negligible significance.   

Legal principles as to damages

72. [72]
    The principles relevant to the assessment of damages are well known and uncontroversial.  I have had regard to statements of principle in O'Reilly v Edgar^[41], Brose v Baluskas & Ors (No 6),^[42]Wagner & Ors v Harbour Radio Pty Ltd & Ors^[43], Cerutti v Crestside Pty Ltd (“Cerutti”)^[44] and Wagner & Ors v Nine Network Australia Pty Ltd & Ors^[45].
73. [73]
    The following principles emerge from a consideration of the authorities:

    1. (a)
       damages are compensatory;
    2. (b)
       although there is a single cause of action, assessment must take account of the circumstances on each occasion of publication;
    3. (c)
       damage to reputation is presumed although often evidence will be given of hurt to feelings;
    4. (d)
       the purpose of an award of general damages is to compensate the plaintiff for the harm to their reputation whether presumed or proved, to compensate for the hurt to their feelings and to vindicate their reputation by showing the falsity of the allegation;
    5. (e)
       an award reflects all three goals and need not be assessed separately if indeed it could be given the necessarily imprecise nature of the assessment;
    6. (f)
       the extent of publication as well as the magnitude of the sting;
    7. (g)
       aggravated damages arise for consideration if there is a lack of bona fides in the defendant’s conduct or if, more generally, it’s able to be described as “improper or unjustifiable”;^[46]
    8. (h)
       aggravated damages have no element of punishment but are compensatory in nature.  While the conduct of the defendant is relevant, that is so only to the extent to which the harm to the plaintiff is increased;
    9. (i)
       the conduct of a defendant right up until judgment is relevant.

Submissions on damages

74. [74]
    The plaintiff pointed to the evidence of witnesses called as to the plaintiff’s reputation and as to the impact upon him.  In this respect, it was submitted that the evidence demonstrated that the statements had a grave affect upon him beyond the presumed damage to reputation.  In this respect, it is submitted, and I accept, that the defendants must take the plaintiff as they find him. 
75. [75]
    For the defendants, it was submitted that:

“Any award of damages should be moderated by the following:

1. (a)
   there is no evidence that anyone who knew the plaintiff now thinks less of him;

2. (b)
   the plaintiff is an experienced businessman with much life experience, including a migrant experience growing up in Sydney, time spent playing rugby league, and working in an engineering firm (both in an office and factory environment);

3. (c)
   the defendant has continued as chairman since the events, despite his ‘upset’.”

76. [76]
    While I accept that there is no evidence that anyone who knew the plaintiff now thinks less of him it is of course not necessary for a plaintiff to call witnesses to establish that given that damage to reputation is presumed.^[47]  In any case, the fact that these witnesses did not think less of the plaintiff does not establish that others who learned of the publications would not have.  In any case, there was very substantial evidence relevant to the second factor sought to be compensated by an award of general compensatory damages.  That is, hurt to feelings.
77. [77]
    In this respect, while I accept the defendants’ submission as to the plaintiff’s past experiences being accurate, I do not doubt the evidence as to the effect upon him.  None of the evidence was challenged whether by reference to the matters now relied upon by the defendants or otherwise. 

Comparable decisions

78. [78]
    As is clear from Cerutti^[48] and other authorities in this area, there are significant limitations upon the usefulness of comparable authorities in assessing damages for defamation.  Notwithstanding that, I have been referred to and have considered the cases cited on behalf of the plaintiff and the defendants.  The plaintiffs rely upon Hallam v Ross (No 2),^[49] Roberts v Prendergast,^[50] Cerutti^[51] and Bertwistle v Conquest (“Bertwistle”).^[52] 
79. [79]
    The defendants referred me to Murray v Raynor,^[53] Tsang v Harle (“Tsang”),^[54] O'Brien v Bielecki,^[55] Matthews v Pigram,^[56] Noone v Brown^[57] and Hocken v Morris.^[58]
80. [80]
    While I have considered each of those judgments, I do not consider it useful to seek to extract a table of awards and seek to identify differences between those matters and this one.  I also conscious that a broad range of damages awards might be appropriate for any particular case and that very moderate or very generous awards do not necessarily demonstrate a trial judge has fallen into error.^[59]
81. [81]
    Mr Coveney appropriately accepted that the defendants’ case had difficulties so far as the factors relevant to an award of aggravated damages were concerned.  Most notably, I refer to persistence in an abandoned truth defence and failure to apologise.  To that it may be added that the other difficult aspects for the defendants relevant to the question of aggravated damages are:

    1. (a)
       the plaintiffs knowledge of the falsity of the imputation;
    2. (b)
       that there was nothing justifiable or proper as to what was said – it was based on rumour or third hand evidence and speculation;
    3. (c)
       that notwithstanding the matters set out in the previous email, the plaintiff’s email and Ms Hachem’s email, the first defendant stated the plaintiff was a liar to the extent to which he denied the allegations and she made no attempt to obtain his version of events, and I would infer, had no interest in doing so;
    4. (d)
       that her tone and expressions, and indeed punctuation, was well beyond any reasonable method of expressing her views;
    5. (e)
       that the second defendant maintained an ambitious defence based on agency  throughout the evidence in the case and only abandoned it in closing address.
82. [82]
    In all the circumstances, I am satisfied that an award of aggravated damages is appropriate.
83. [83]
    Overall, it seems to me that the relevant features of this matter are as follows:

    1. (a)
       there were two instances of publication here with the second following both the denial by the plaintiff of the imputations in the first publication and the apology by Ms Hachem, which ought to have been cause for at least some reflection;
    2. (b)
       there is uncontested evidence as to the significant hurt to the plaintiff;
    3. (c)
       whilst the publication was to limited recipients, it was to a group of people acquainted with the plaintiff and with whom the plaintiff is required to deal as his neighbours on an ongoing basis.
84. [84]
    In respect of the comparable authorities:

    1. (a)
       It seems to me that Roberts v Prendergast^[60] had greater potential for harm resulting from the defamatory statements having regard to the grapevine effect in a regional town.  They were also imputations that went quite directly to the source of his livelihood, unlike the position in the present manner;
    2. (b)
       in Cerutti,^[61] the defendant had made disparaging comments about the plaintiff who was an accountant suggesting that he had double billed amongst other things.  On appeal, Justice Applegarth considered that an appropriate range was between $15,000 and $30,000;
    3. (c)
       in Hallam v Ross (No 2),^[62] the trial judge (Margaret Wilson J) indicated that she would have awarded $20,000 were it not for the mitigating fact that two of the imputations were true.  Thirty-seven emails had been sent and there were imputations that the plaintiff was a criminal and dishonest;
    4. (d)
       in Bertwistle,^[63] the publication was to a single person but the imputation was that the plaintiff had had consensual and non-consensual sex with his sisters.  The proceeding was not defended.  $100,000 in damages was awarded;
    5. (e)
       in Murray v Raynor,^[64] an indicative assessment of $25,000 was indicated  where the defence was upheld on appeal.  The imputations in that matter had substantially less sting;
    6. (f)
       in Tsang,^[65] there was no issue on appeal as to the quantum of the damages.  The defamatory imputations in that case included that the plaintiff had sexually harassed the defendant’s wife, had intentionally damaged the defendant’s property and had engaged in bullying and threatening behaviour.  Whilst serious, they are imputations that are not, in my view, as serious as those in the present matter.  In any case, as I have said, there was no issue on appeal as to damages;
    7. (g)
       O'Brien v Bielecki^[66] concerned statements to the effect that the plaintiff was the most vindictive, poisonous human that the defendant had the ill fortune to meet and that he was toxic and vile and finally that he lied to police, which was the obviously more serious imputation.  I do not consider that it was anything like as  serious as the imputation of being involved in criminal activity in this matter.  Imputations of this kind are considered particularly seriously in the authorities.^[67]  In this case, there was a successful defence.  While submissions were made on behalf of the plaintiff for an award of $30,000 including $10,000 on account of aggravated damages, her Honour indicated that she would not have awarded more than nominal general damages of $1,000.  On behalf of the defendants it was accepted that while this case might demonstrate that very small awards could be made it might be considered an outlier.  Also, there appears to have been no evidence as to the extent of any distress and the plaintiff was not considered to be a credible witness;
    8. (h)
       Matthews v Pigram^[68] concerned an imputation that the plaintiff was a peeping tom.  That imputation was published to the plaintiff’s employer and other residents in the building complex in which the plaintiff was the strata committee chairperson.  The plaintiff described being hurt and embarrassed. The award was $20,000.  The assessment was uncontested.  It is also relevant that no aggravated damages were awarded;
    9. (i)
       In Noone v Brown,^[69] there was fairly broad publication of imputations to the effect that the plaintiff had a problem with alcohol and had been dismissed from a previous job because of problems with alcohol and/or being responsible for narcotic drugs going missing.  A number of other imputations were found to not have been made out.  The award of damages in that case was $15,000 inclusive of $5,000 by way of aggravated damages;
    10. (j)
        In Hocken v Morris,^[70] very serious imputations were made that the plaintiff had been responsible for the notorious kidnapping and murder of a Queensland teenage boy.  The award was $75,000 including $25,000 in aggravated damages.  It was appropriately conceded on behalf of the defendants that many years had gone by since this case was decided but it was submitted that it was an extremely serious allegation and I accept that it was a much more serious allegation than in the present case.
85. [85]
    While I accept that some increase should be applied to some of the comparables to take account of the passage of time I do not consider that there is any particular mathematical precision that is able, or ought, to be applied to that exercise.  I do not accept that that factor together with the imputations in this matter being more serious in those in Cerutti^[71] suggests an award of as much as $120,000. 

Conclusion on damages

86. [86]
    Having regard to the factors that I have identified in paragraphs [65], [80] and [82] above, in my view, an appropriate award of damages including aggravated damages is $70,000. 

Interest

87. [87]
    In addition, the plaintiff claims simple interest at the rate of 3 percent pursuant to s 58 of the Civil Proceedings Act 2011. 
88. [88]
    The defendants make no alternative submission as to the rate of interest.  In the circumstances, there will be an order that the defendants pay the plaintiff interest on the sum of $70,000 at 3 percent from 12 September 2018 until 19 August 2022 being a period of 1,439 days for a total of $8,279.18. 

Injunctive relief?

89. [89]
    The final matter to consider is the plaintiff’s claim for permanent injunctions restraining the defendants from repeating the meanings or meanings to similar effect to the imputations I have found.  The defendants submit that no injunctions are appropriate as there is (so it is submitted) no evidence that the first defendant would be likely to make such a statement again.  It this respect it is submitted that to the contrary the statement was last made in 2018 and the first defendant was not cross-examined as to whether she intended or had any interest in saying it to anyone ever again.  In addition, it was submitted an injunction might inadvertently serve as an unnecessary restraint on what would otherwise be permissible body corporate discussions by members of the committee.  As I indicated during addresses, I consider it is possible to militate against that risk with careful drawing of the form of injunction.
90. [90]
    The plaintiff relies upon the behaviour of the first and second defendant during the course of the proceeding in running an unmeritorious truth defence up until the morning of the commencement of the trial as well as the agency defence which was abandoned in closing submissions.  Further, the plaintiff relies upon the reasons identified by Ms Pavlovic as to why she made the statements including her anger at the time.  It is submitted that where there were ongoing commercial relationships between the plaintiff’s company and the second defendant (which are clearly tense) there is a risk of the matters being repeated.
91. [91]
    While it is true that the first defendant was not specifically cross-examined as to whether or not she intended or had any interest in saying anything again, given the matters I have just referred to as well as those referred to in the section above on malice, I consider that evidence gives rise to an inference that the risk remains. 
92. [92]
    Accordingly, there will be orders in this respect that:

    1. (a)
       The first defendant is permanently restrained by herself, and/or her servants or agents from publishing or causing to be published any of the matters complained of in paragraphs 5(b), (d), (e) and (f) and 7(a) and (c) of the amended statement of claim filed in this proceeding on 12 April 2019 or matters substantially to the same effect as those matters complained of.
    2. (b)
       The second defendant is permanently restrained by itself, and/or its servants or agents from publishing or causing to be published any of the matters complained of in paragraphs 5(b), (d), (e) and (f) and 7(a) and (c) of the amended statement of claim filed in this proceeding on 12 April 2019 or matters substantially to the same effect as those matters complained of.

Orders

93. [93]
    There will be orders that:

    1. The first and second defendants pay the plaintiff damages for defamation in the sum of $70,000 in respect of the publication of the imputations pleaded at paragraphs 5(b), (d), (e) and (f) and 7(a) and (c) of the amended statement of claim filed 12 April 2019.
    2. The first and second defendants pay the plaintiff interest in the sum of $8,279.18.
    3. The first defendant is permanently restrained by herself, and/or her servants or agents from publishing or causing to be published any of the matters complained of in paragraphs 5(b), (d), (e) and (f) and 7(a) and (c) of the amended statement of claim filed in this proceeding on 12 April 2019 or matters substantially to the same effect as those matters complained of.
    4. The second defendant is permanently restrained by itself, and/or its servants or agents from publishing or causing to be published any of the matters complained of in paragraphs 5(b), (d), (e) and (f) and 7(a) and (c) of the amended statement of claim filed in this proceeding on 12 April 2019 or matters substantially to the same effect as those matters complained of.
94. [94]
    I will hear the parties on the question of costs.