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Defamation ruling not very appealing

By Steven | October 8, 2013

Reading the Court of Appeal’s decision in Smith v Dooley [2013] NZCA 428, you get the feeling that the High Court blundered in all the ways it’s possible to blunder in a defamation case. Lang J couldn’t even correctly work out what the words meant. And even if he’d got that right, he couldn’t tell that they were actually true. Qualified privilege? He said the defence wasn’t available, but it was. He even botched the question of what the remedy should be.

Lang J granted Dooley a declaration that he had been defamed, and an award of costs (he didn’t seek damages). The Court of Appeal overturned that. Now, six years after the publication of the press release he said defamed him,  Dooley is left with nothing except, I expect, a very large costs bill.

What’s going on here? An inept High Court judgment? Just a series of bad calls? Serious disagreement about legal principle? Or an overweening Court of Appeal?

The facts are rather complicated. But they revolve around an email that Dooley didn’t know about.

Dooley was the chair of Development West Coast, a charitable trust charged with managing a big pool of government money to foster regional economic development. There was vigorous disagreement among trustees over various issues. Trustee elections were looming.  Smith was running for election to the trust, and had been an outspoken critic of Dooley.

In the middle of all this, the DWC’s chief executive sent a controversial email to Ngai Tahu. Ngai Tahu appointed one of the trustees (they weren’t all elected). The email advised Ngai Tahu to watch out for “googlies” in the appointment process – thrown by people trying to oust Dooley.

Dooley didn’t know about this email. But some of the other trustees got wind of it. One asked Dooley whether the trust had written to Ngai Tahu to lobby for the retention of the existing appointee.  Dooley, in turn, asked the chief executive and Ngai Tahu. Both denied receiving any email of that type. Strictly speaking this was accurate. Dooley told the trustees there had been no such email.

The trustee pressed on, asking whether there had been any communication “about the Ngai Tahu appointee to the trust”. Dooley said again there was no such letter. This was arguably inaccurate. The email really was about the appointment of the trust’s appointee. But Dooley didn’t know about it.

There’s more to the story, but the upshot is that Smith learned about the email and the correspondence, and (having discussed it with a trustee) made comment to the media. He said: “The correspondence amounts to serious interference with the electoral process. I find it disturbing that the CEO and Chair denied its existence. Can the (future) trustees have any faith that the CEO or Chair will not be misleading them on matters of significance”? He went on to criticise the CEO for sending the email.

Dooley sued. The first issue was about the meaning of this statement. Did it suggest that Dooley deliberately misled the trust about the email? Lang J said it must do. Smith could only be “disturbed” by the denial if it was a lie.

The Court of Appeal disagreed. It said what Smith found disturbing was merely that Dooley didn’t know about the email, when he should have. Smith said in evidence that’s what he meant. The rest of the press release was criticising the CEO, the judges noted.

I don’t buy this. The judges accept that Smith’s intentions were irrelevant. The question is what ordinary, fair-minded readers would have thought. There’s a powerful argument that they would have thought: “Hmmm. The Chair denied the existence of the email. This bloke Smith says that’s disturbing. Then he says maybe the Chair can’t be trusted not to mislead the trust in future. He must be saying the Chair knew about the email and lied about it.” That’s not because this is the only logical conclusion. It’s because it’s what people will think when they read it.

The next issue was truth. Lang J found that it wasn’t true: Dooley didn’t know about the email after all. The Court of Appeal disagreed again. Even if the meaning was that Dooley had deliberately misled trustees about the email, it was true, they said. He did this by failing to tell the trustees about the email for several days after he found out about it. He didn’t put the record straight when he had the opportunity to.

I’m inclined to think there’s a material difference between a dishonest denial that an email has been sent (which was incidentally how the case was pleaded), and a failure to immediately correct the record (which wasn’t). So I’d side with Lang J again, though perhaps it’s a line call.

The really interesting issue, I think, was qualified privilege. Should it extend to elected officials who aren’t MPs? In what circumstances should it be defeated by improper motivations or failure to act responsibly? Lang J indicated that he thought this defence should apply to criticisms of local body politicians too. This seems like a no-brainer to me. It’s annoying that the Court of Appeal didn’t endorse that observation.

For Lang J, this defence failed because Smith was primarily motivated by personal animosity toward Dooley. He relied mainly on a parade of letters to the editor written by Smith, criticising Dooley. But these were all raising serious political points, and could simply be seen as robust political rhetoric. I think it was a serious error to suggest that this was evidence of the sort of ill-will that defeats a qualified privilege defence.

He also thought Smith acted irresponsibly by failing to examine the emails himself. That would have made him realise that Dooley genuinely didn’t know about the email. I think this is questionable. I doubt he would have believed what Dooley said in his emails. And Smith had phoned a trustee to discuss his allegations before he released his press release.

The Court of Appeal made similar points. It found the qualified privilege defence was made out. I have to agree.

The final issue concerned remedies. Lang J granted the declaration sought. The Court of Appeal felt that would not have been appropriate, even had the defamation been proved. The remedy is discretionary, the judges noted. They said there was a long and not adequately explained delay before filing proceedings (though they refer to a failed settlement agreement that suggests that most of the delay was explained).

I’m mystified by this. A refusal to grant a declaration, once a defamation has been made out, where a plaintiff has foregone a claim for damages and focused on clearing his name, even if there have been large delays, strikes me as churlish and unfair.

So there’s my verdict: High Court judge unfairly maligned. But the Court of Appeal was ultimately justified in overturning the decision on one point.

I think this case also points up a need for possible reform. If a plaintiff only seeks a declaration, why should qualified privilege be a defence?

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