Stokes v John Fairfax Publications Pty Ltd [2003] NSWSC 678

New South Wales Supreme Court

CITATION : Stokes v John Fairfax Publications Pty Ltd [2003] NSWSC 678 HEARING DATE(S) : 23 July 2003 JUDGMENT DATE : 23 July 2003

JUDGMENT OF : Simpson J DECISION : the statement of claim will be struck out unless the plaintiff files an amended pleading, including the column headed "Plavsic is returning to familiar territory"; no order as to costs

CATCHWORDS : defamation - capacity - whether the plaintiff should be directed to include additional material in the matter complained of PARTIES : Kerry Matthew Stokes - Plaintiff John Fairfax Publications Pty Ltd - Defendant FILE NUMBER(S) : SC 20086/03 COUNSEL : P Gray - Plaintiff K Smark - Defendant SOLICITORS : Clayton Utz - Plaintiff Richard Coleman - Defendant

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION DEFAMATION LIST

SIMPSON J

Wednesday 23 July 2003

20086/03 Kerry Mathew STOKES v JOHN FAIRFAX PUBLICATIONS PTY LTD

JUDGMENT 1 HER HONOUR: By statement of claim filed on 8 April 2003 the plaintiff complains of three allegedly defamatory imputations said to have been conveyed in the Financial Review dated 4 April 2003. This is an application under Pt 31 r 2 for a separate trial of issues concerning:

(i) the capacity of the matter complained of to convey the pleaded imputations; and

(ii) whether the plaintiff should be directed to include additional material in the matter complained of. 2 The material before the court shows that a considerable amount of coverage was given in the newspaper to the general subject matter of television station Channel Seven, its executive chairman who is the plaintiff, one former executive officer, a newly appointed chief executive officer and other matters concerning the television station.

3 The imputations which the plaintiff has pleaded as set out in paragraph 4 of the statement of claim are: "(a) The Plaintiff, by his incompetent meddling as Executive Chairman in the management of the Seven Network business, has caused the television ratings of the Seven Network to fall.

(b) The Plaintiff, by his incompetent meddling as Executive Chairman in the management of the Seven Network business, has caused the share price of the Seven Network to fall.

(c) The Plaintiff as Executive Chairman has presided over the Seven Network's continuing failure to have any independent directors on its board, contrary to modern requirements of corporate governance." 4 The material complained of is too lengthy to set out in full. It appears in three separate sections or stories, of which the most significant for present purposes is under the Chanticleer column which, I am told, commences on the back page of the newspaper and is continued further back in the paper. For pleading purposes, each paragraph has been given an identifying number (which did not appear in the original publication). 5 That column contains the following material paragraphs: Paragraph 4

"David Leckie may be joining some old colleagues at his new home in the Seven Network, but just whether he can reverse its ratings slide comes down to whether his executive chairman, Kerry Stokes, can keep his hands out of the business."

Paragraph 10

"In these days of corporate governance purity, Leckie is walking into a disaster area, with not one of the eight directors classed as an independent, given that deputy chairman Peter Ritchie has served more than 12 years on the board and Dulcie Boling and Murray Wells are consultants to the company."

Paragraph 14/18

"Packer's school of media management has proved extraordinarily successful when you consider that former PBL chief and Nine finance man Nick Falloon is calling the shots at Ten and former Nine boss Leckie will now call the shots at Seven if Stokes lets him." 6 The defendant has challenged the capacity of the matter complained of to convey the imputations pleaded. 7 Further, the defendant asserts that the plaintiff should be required to plead a fourth part of the newspaper which appears on the same page as the bulk of the material complained of. That is a separate column headed "Plavsic is returning to familiar territory" and is directed to the role of the former executive (Ms Plavsic) to whom I earlier referred. 8 In order to consider the capacity argument it is really only necessary to have regard to the paragraphs from the Chanticleer column which I have earlier extracted. 9 In the paragraphs numbered 4 and 18 there is, in my view, material on which a jury could find an assertion that the plaintiff meddled in the management of the television station. That appears clearly from the concluding words of each of those paragraphs. 10 In other parts of the matter complained of there is discussion of falling share prices and falling ratings and indeed, "ratings slide" is referred to in the paragraph numbered 4. 11 Mr Smark, who appears for the defendant, concedes the threshold a plaintiff must cross in order to establish the capacity of a publication to convey imputations of which complaint is made is relatively low. The more significant test is that committed to a jury, that is, whether those imputations are in fact conveyed. 12 Bearing in mind that relatively low threshold I have come to the view that the matter complained of is capable of conveying the first and second imputations pleaded and that that issue should be determined by a jury. I rely particularly on the matters to which I have already referred. That is, the references in paragraphs 4 and 14/18 to the plaintiff's alleged interference in the management of the network, and the reference to falling ratings and share prices. The third imputation is capable of being conveyed by reference to the content of paragraph 10. 13 I turn now to the application that the plaintiff be directed also to plead the column concerning Ms Plavsic. (It is probably more correct to characterise the application as one that the statement of claim be struck out unless the plaintiff pleads the additional material.) 14 The extensive nature of the reports and discussion of the Channel Seven matters is significant. This is no minor story buried in the intestines of the newspaper, but a most comprehensive examination of financial and management matters relating to Channel Seven, spread over several pages. What I might call the Plavsic story or the Plavsic column appears on the same page as the bulk of the other material, although not the page on which the most critical passages are contained. 15 I am of the view that when regard is had to the depth and breadth of the examination of Channel Seven matters the defendant is entitled to have the plaintiff plead the additional column and I will make an order to that effect. 16 The order I make is that the statement of claim will be struck out unless the plaintiff files an amended pleading, including the column headed "Plavsic is returning to familiar territory". 17 I make no order as to costs. **********

Last Modified: 07/29/2003 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.