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Papua New Guinea Law Reports |
PAPUA NEW GUINEA
[NATIONAL COURT OF JUSTICE]
PNG AVIATION SERVICES PTY LTD;
DOUGLAS NEIL VALENTINE;
YORK ANDREW MENDOZA;
WALTER ANDREW LUSSICK;
V
MICHAEL THOMAS SOMARE; and
INDEPENDENT STATE OF PAPUA NEW GUINEA
WAIGANI: SHEEHAN J
19 July, 6 September 1993, 20 December 1996
Facts
In 1985, during question time in Parliament, the Opposition Leader accused the Government of Michael Somare of accepting bribes in return for business favours. The allegations related to Government negotiations leading to the sale of Government jet aircraft, the Kumul 1 and the involvement of the plaintiffs. The issues raised by those allegations aroused considerable public interest.
In response to the allegations, the then Prime Minister, Mr Somare, denied any impropriety on the part of the Government or his own business dealings. He launched a severe and scathing attack on the Leader of the Opposition and the plaintiffs – PNG Aviation Services Pty Ltd and its directors, Messrs Valentine, Mendoza and Lussick. After his reply in the parliament, the Prime Minister allowed the publication of the contents of his reply in each of 4 newspapers circulating in Papua New Guinea at the time under the national crest in advertisements printed over 3 days.
As consequence of the seriousness of the allegations, which aroused a lot of public interest, a Commission of Enquiry was constituted in August 1985 known as Pelair Enquiry. The Commission delivered its finding in September 1986 in which the plaintiffs were cleared of any wrong doing. Thereafter, the plaintiffs commenced proceedings against the defendants for defamation in respect of the Prime Minister’s speech in reply to the allegations by the Opposition.
Held
Papua New Guinea case cited
Tei Abal v Anton Parau [1976] PNGLR 251.
Other cases cited
Calwell v Ipec Australia Ltd (1975) CLR 321.
Clines v Australian Consolidated Press Ltd [1966] NSWR 481.
Dingle v Associated Newspaper Ltd [1961] 2 QB 162.
Gorton v ABC (1973) 22 FLR 181.
R.v Lord Abingdon (1794) 170 ER 337.
R v Creevey (1815) ER 102.
Telegraph Newspaper Co Ltd v Bedford [1934] HCA 15; (1934) 50 CLR 632.
Counsels
I Molloy & J Shepherd, for plaintiffs.
K Cullinane Q C & B Frizell, for defendants.
20th December 1996
SHEEHAN J. On 16 August 1985, the Prime Minister of Papua New Guinea, the Hon Mr Michael Somare addressed Parliament in answer to questions that had been put to the Government by the Leader of the Opposition, Mr Paias Wingti.
The Government was challenged in its dealings relating to the sale/purchase of Government aircraft. The Opposition, through its Leader, accused the Government of accepting bribes in return for business favours. At that time, the issues raised by those questions were a matter of considerable public interest.
Mr Somare, in his reply to the House, denied any impropriety in Government’s or his own business dealings and launched a severe and scathing attack on the Opposition Leader. In the course of this speech, he made equally severe and damaging assertions about the plaintiff company, PNG Aviation Services and its directors, Messrs Valentine, Mendoza and Lussick.
Following that speech in the House, the Prime Minister caused report of it published under the State crest in advertisements printed over three days in each of 4 newspapers circulating in PNG at the time. It reads as follows:
Statement by Prime Minister Michael Somare in reply to a statement by Opposition Leader Wingti, August 16, 985:
Mr Speaker,
Yesterday, the Opposition Leader made a statement about Government negotiations leading to the sale of Kumul 1 and the purchase of Arava Aircraft for the Defence Force.
Sir, in that statement he made a number of vicious, dishonest and slanderers allegations about my conduct in this House. He accused me of deliberately lying to this House and of associating with criminals.
Sir, I believe the member for Hagen has - in his enthusiasm for the opposition role overstepped the mark dramatically.
Sir, Mr Wingti is relatively inexperienced, and perhaps he doesn’t fully understand legal documents, so I would like to give him the chance to retract his statements.
Mr Speaker, since the honourable member does not choose to retract his statement full responsibility for it must fall on his head. And, Sir, it is a dreadful responsibility. The member for Hagen will for many years regret his rashness and ill-considered words on this subject.
For, Sir, the leader of the opposition not only mislead this House on this issue - yesterday he deliberately mislead honourable members. He lied to this House!!!!
Sir, Mr Wingti lied repeatedly and he deliberately misinterpreted my statements and various legal documents to suit his own ends.
Sir, I will demonstrate to every member of this House how the member for Hagen has lied and I will use his own documents and words to do it!!!
Mr Speaker the dishonesty exhibited by the Opposition Leader is on a level rarely seen in this house previously. It is dishonesty, which must bring upon the Opposition Leader's head the condemnation of all decent thinking citizens.
Sir, I will deal with his scurrilous allegations in the order they were delivered.
First, Sir, I was accused of lying to this House in a statement I made on June the seventh.
Sir, I do not lie!
I stand by every word of that statement. I have nothing to hide! And I have nothing to apologise for.
Sir, the Opposition Leader has been manipulated by a disreputable foreign owned company.
Sir, PNG Aviation Services have tried repeatedly to mislead and cheat this Government and when they failed to do that they have tried to embarrass us by leaking documents to the gullible members of the opposition.
Sir, yesterday Mr Wingti tabled a number of documents and claimed and here I quote These documents are total proof that PNG Aviation Services Pty Ltd was appointed the Sole Agent for the sale of Kumul 1.
End of quote.
Sir, the member for Hagen continued to say that these documents proved I was lying.
Sir, that statement not only proved that Mr Wingti is not very wise, it showed that he is rash and irresponsible. These documents demonstrate only that PNG Aviation Services entered into a preliminary agreement - an escrow agreement with the Government of Papua New Guinea.
Sir, for the Opposition Leader’s information an escrow agreement is merely a conditional agreement. It is not a firm contract; it is an agreement conditional upon certain actions.
Sir, in this case PNG Aviation Services did not fulfil the conditions of the escrow and it lapsed.
Sir, to anyone who understood these documents and after serving the National Executive Council, the member for Hagen should understand them; the import is quite clear.
The heading alone should be enough.
It says and Sir I have the document here 'Seller's Escrow Instructions'.
It is not a contract. It is not a firm commitment. It is a condition agreement, as page two of the document makes quite clear.
Sir, I quote from the part headed 'General Provisions' Part Two -
Time is of the essence in this escrow, unquote.
Sir, PNG Aviation Services had an escrow - and an escrow only - on the sale of the Kumul.
It was a limited escrow for three weeks from August the third, 1983.
The company failed to live up to the conditions of the escrow and because of this failure was not appointed as an official agent for the sale of Kumul 1.
Sir, the conditions of the escrow were not met so PNG Aviation Services failed in their bid to become an agent for the aircraft. The appointment documents signed by my colleague the Minister for Finance was conditional on the terms of the escrow being met.
They were not met and PNG Aviation Services were not appointed as official agents.
Sir, the conditions the company failed to meet are set out in part four of the general provisions. And here Sir, I quote again five hundred thousand United States dollars, (US$500,000) and seven (7) days prior written notification to the Independent State of Papua New Guinea of proposed date of inspection and details of persons forming inspection team to enable the state to have its representative available for the inspection and acceptance flight test. End of quote.
Sir, that company failed to meet the conditions of the escrow.
They were not official agents of the PNG Government then and to the best of my knowledge they have not been agents for the Government in relation to any other transaction.
Sir, my officials found that, not only did PNG Aviation Services fail to meet the conditions of the escrow; they tried to undermine them and sneak by without fulfilling their legal obligations.
Sir, PNG Aviation Services and its principals are completely untrustworthy and dishonest.
Their own documents prove this.
Sir, that company deliberately and with criminal intent sought to defraud the Papua New Guinea Government during the negotiations leading up to the sale of Kumul 1.
Sir, to substantiate these allegations I table two documents.
The first consists of information provided to a Minister, Sir Barry Holloway by Mr Valentine of PNG Aviation.
The second is the report of the official government inspection of the aircraft, which was prompted by Mr Valentine's communication.
(Table documents)
Mr Speaker, it is typical of Mr Valentine's behaviour that he did not operate through the correct channels, he attempted to politically manipulate ministers just as he is manipulating the member for Hagen now.
Sir, document one makes a number of spurious allegations about the condition of Kumul 1. Mr Valentine claims the interior of the plane was in terrible condition, it had been left out on the tarmac and so on.
Sir, all these claims were later proven to be absolute lies!!
The intent of this document, we believe, was to make us distrust the company we were dealing with and transfer our business to PNG Aviation Services.
In other words, having failed to win the business legitimately. PNG Aviation Services were trying through slander and innuendo to undercut their rivals.
Sir, these were serious accusations so my department head, Mr Yauieb, immediately ordered an office of Civil Aviation official, Mr E. C. Johnston, superintendent of Air worthiness, to fly to Copenhagen to inspect the aircraft.
His report is Document 2.
Sir, this document shows that there was nothing whatsoever wrong with the aircraft.
It also shows that the information supplied to my Government by Mr Valentine was completely misleading and false. Valentine lied to my Ministers.
Sir, these lies caused this Government to spend a great deal of money as we had to ensure that the allegations were false.
Sir, PNG Aviation Services' role in this incident can only be described as negligent or criminal.
The state solicitor has expressed a preliminary opinion that the state has civil legal rights against Mr Valentine for negligent misstatement and injurious falsehood or slander of title.
I have issued instructions for the State Solicitor to be fully briefed and to institute proceedings if the brief confirms his preliminary opinion.
Sir, subsequent to the incident I described, my departmental head decided on his own initiative and through no influence of mine that Mr Valentine and PNG Aviation Services were not trustworthy and recommended terminating dealings with them.
Sir, the NEC and the member for Hagen was at that meeting, accepted these recommendations and terminated all dealings with PNG Aviation Services.
Sir, the reason for this termination was the company's complete failure to live up to the conditions of the escrow agreement.
We now believe PNG Aviation Services did not have the capacity to meet the conditions and did not at any stage intend to meet them.
An example of this is their attempts to avoid depositing money for inspections. Sir, I would like to table another document Number 3. (Table Document)
Sir, this document is made up of a series of telexes between Mr Valentine and an official of my department. They clearly demonstrate that Mr Valentine was trying to bend the conditions of the escrow agreement specifically the conditions of part 4 of the general conditions I quoted earlier, he tried to dodge these to his own advantage. Having failed in that attempt, he then tried to lobby other ministers in an attempt to work his way around my officials. Sir, these documents clearly demonstrate that Mr Valentine did not meet the conditions of the escrow and did not intend to! Mr Speaker, it is obvious to all observers that PNG Aviation Services is now feeding scandalously misleading material to the member for Hagen in order to embarrass the Government.
We now know what Mr Mendoza and Mr Valentine of PNG Aviation Services are like. There is no question about them. The question is why does the Opposition Leader associate with these individuals? Why does he believe the absolute nonsense that they feed to him?
Sir, one could dismiss the allegations made by the Opposition Leader as merely being the mistake of an inexperienced and rash man.
However, I - considering the deep offence and pain that he gave me yesterday - am not inclined to do so.
I believe that the member for Hagen deliberately and dishonestly misinterpreted these documents - and that he deliberately misled the honourable members of this Parliament.
Sir, the member for Hagen went on to accuse me of another lie, in this instance he not only misinterpreted these documents and that he deliberately misled the honourable members of this Parliament.
He claimed that I had said things that I had not said. Sir, he deliberately lied to this House!
The Opposition Leader did quote me accurately. He repeated my words as I had said them.
But, he then went to completely misinterpret them. He was either being excessively stupid or he was deliberately twisting the facts.
I told this house that the company, Intercrop, which was the agent of Israel Aircraft Industries in this region, did not accept that PNG Aviation Services was their sub-agent.
Sir, that statement - I believe - is quite clear to all reasonably intelligent and sensible people.
Intercrop did not accept any claims regarding sub-agency agreements. PNG Aviation Services obviously disagreed - as I stated on June seventh.
I did not side with either company in a dispute which is purely commercial and has nothing to do with the Papua New Guinea Government.
But, the Opposition Leader claimed that I did side with one company. He said I claimed that no legal agreement existed between the companies.
That is an outright and damnable lie!
At the time of making that statement, I knew there was an agreement. But, I also knew that it was a matter of legal dispute. Intercorp claims that the agreement is no longer valid due to the non-performance of PNG Aviation Services.
PNG Aviation Services claim it is valid and have threatened to take legal action.
As yet, nothing has resulted.
Sir, as I have said many times before, this dispute has nothing to do with the Papua New Guinea Government, it would be beneath my dignity as Prime Minister to comment on it.
It is not a matter for the Government and I am not interested in it. It is a dispute between commercial companies. It is not a matter for Government and never was a matter for Government.
I can only say I am extremely saddened by the Opposition Leader's obvious gullibility and tendency to believe anything he hears from individuals involved in such a dispute.
Sir, such behaviour is beneath the dignity of a real Leader of the Opposition.
The member for Hagen's behaviour in the last few days exposes his naivety and lack of experience.
Mr Speaker, Mr Wingti then went on to try and - in some way - tie me in with various people identified with Wings Australia in this part of his statement he grew even more reckless and vicious.
He tried to link me - The Prime Minister of Papua New Guinea - with people who are under suspicion of criminal behaviour!
Sir, the member for Hagen has not only exceeded the bounds of good taste, he has attempted to bring our nation into disrepute.
On June the seventh I did not defend the people involved in Wings Australia against the allegations made against them.
I did not defend them in any way - I did not have the information to do so - and even if I had - I would not have done so.
Sir, as Prime Minister of Papua New Guinea it is not my role to defend individuals accused of criminal offences.
It would appear that there are quite a few questions hanging over the principals involved in that venture.
There are serious allegations about various activities and I believe an individual - an Australian police sergeant - has been suspended pending investigation of these allegations.
Sir, I know nothing- of these allegations other than what I have read in the Media and what my advisers have told me.
I do not know whether the allegations are correct or not and I do not wish to venture any opinion on them.
Sir - it - at the time of my dealings with these people, I had known about these allegations I certainly would not have met them.
I am always conscious of Papua New Guinea's good reputation and very careful of it.
However, at the time, I was not aware of the allegations and I could see no reason not to see them.
I do not apologise for this. No one can see into the future.
In the same spirit, if I had known how the member for Hagen would behave in March 1985 I would not have allowed him to join the Pangu Pati and I certainly would not have appointed him Deputy Prime Minister.
One can never tell who is going to prove to be a criminal or a turncoat.
Mr Speaker, the member for Hagen finished his ridiculous and totally unsubstantiated attack with all sorts of mud slinging and innuendo.
None of it logical, or proven, and none of it have anything to do with me.
He completed his diatribe with a demand for me to step down from my position pending an investigation.
Sir, it saddens me to say this - but I believe the person who should stand down is the Opposition Leader.
Not only has he failed as Deputy Prime Minister - he has failed as Opposition Leader.
Yesterday's attack stripped him of any credibility that he may have left after his traitorous and disloyal behaviour in March.
The member for Hagen deliberately tried to mislead this House on serious matters. He is guilty of some of the gravest offences a Member of Parliament can commit.
The only investigation that could be launched is into PNG Aviation Services and how they have manipulated the Opposition into this ludicrous position.
Is the member for Hagen a mouthpiece or a business representative of Valentine, Mendoza or Lussick? Why has the Opposition Leader not censured his Deputy Leader for actions which may result in criminal charges for fraud? Mr Speaker, the Opposition is in disarray and I smell corruption at the highest levels.
Instead of being the clean force that Mr Wingti claimed it was going to be, it has become mired in scandal and wild accusations. It has aligned itself with questionable businessmen, allowed its Deputy Leader to get away with criminal behaviour with not a murmur and completely failed to provide any serious policy alternatives.
Sir, to cover up for these failings the member for Hagen launched a vicious, dishonest and false attack on me yesterday.
Sir, this attack - because it was so unfair and such a low form of gutter politics - hurt me deeply.
I was shocked and saddened by it and today I move this motion with a heavy heart.
Sir, I move that this House censure the Member for Hagen for deliberately misleading this House and lying to the Parliament of Papua New Guinea.
Sir, the matter must be referred to the privileges committee.
The member for Hagen is guilty of some of the most deliberately misleading and dishonest comments that have ever been uttered on the floor of this House.
Sir, he did not make them in a moment of honest emotion or passion.
He deliberately - and with underhand cunning - tried to mislead the honourable members of this House.
Sir, for the sake of this House, for the dignity of the National Parliament - he must be disciplined.
Sir, that is why this matter must be referred to the privileges committee.
The issues debated in Parliament and raised in this speech which became the subject of a Commission of Enquiry was constituted on 28 August 1985 and known as The Pelair Enquiry. It delivered its finding in September 1986. At the end of May and at the beginning of June 1987, the company PNG Aviation Services, Mr Mendoza and Mr Lussick commenced proceedings for defamation in respect of this speech. Mr Valentine issued his writ in December 1988.
By these proceedings, the plaintiffs seek to vindicate their reputations. They claim that in this speech, published throughout the country, the ordinary and natural meaning of words and comments made concerning them, amount to gross defamation. They are described as disreputable foreigners, completely untrustworthy and dishonest. It asserts that the company and those associated with it are dishonest and disreputable. It says that they were party to a deliberate and criminal attempt to cheat and defraud the Government of Papua New Guinea, that they were involved in a corrupt association with the Leader of Opposition, that the plaintiffs were dishonestly trying to assert a false meaning to documents of contract entered into with the Government, in order to take improper advantage. It claims that the plaintiffs were party to either criminal or negligent in conduct in relations for negotiation for the sale of the Governments Aircraft "Kumul 1", a Gulfstream Jet Aircraft. By their behaviour the plaintiffs had demonstrated questionable business ethics and were not fit to associate with reputable persons in commercial, political or public life. They claim damages in the sum of K2 million each.
In defence, it was pleaded that the matter published was not defamatory or capable of the defamatory meanings asserted by the plaintiffs. In the alternative, it was contended that in so far as the speech was defamatory of the plaintiffs, the defendants rely on the statutory defences provided in the Defamation Act Ch. 293. The defence states:
(b) it was fair comment: with respect to the proceedings of the Parliament; (and relevant matters under s 9 of the Defamation Act).
(c) it was published in good faith for the protection of the interests of the person making the publication;
(d) it was published for the protection of the interests of the first defendant;
(e) it was published for the protection of the interests of the second defendant;
(f) It was published for the public good;
(g) it was published for the purpose of giving information to its readers with respect to a subject as to which those readers had, or were reasonably believed by the defendants to have, such an interest in knowing the truth as to make their conduct in making the publication reasonable under the circumstances;
(h) it was published in the course of, or for the purposes of, the discussion of some subject of public interest, the public discussion of which was for the public benefit and, so far as it consisted of comment, the comment was fair;
In reply, the plaintiffs maintained that it did not constitute a fair report for public information. It was merely an advertisement filed for the purpose of attacking (inter alia) the plaintiffs. Nor was it made in good faith, rather it was with the knowledge that the allegations in it were untrue or in reckless disregard of the truth or falsity of the allegations. The statement, it was asserted, was made and published for the purpose of attacking the character and reputation of the plaintiffs.
The plaintiffs plead that the publication could not be claimed to be fair comment either, because no facts are claimed as true on which any comment might legitimately be based. In fact, they say the publication does not constitute comment at all but simply consists of untrue assertions of fact concerning the plaintiffs made in exaggerated and extravagant language.
In Papua New Guinea, the Defamation Act (Ch. 293) which consolidates the law on defamation protects the rights of individuals to their good reputation. It restates the essential common law principles in statutory form. It is the substantive law of defamation, but without provisions for such matters as procedure, damages or even the absolute protection of Parliamentarians for speeches in the House, the Act is not an exhaustive code in the way that Australian statutes on which it is modelled are said to be codes. Accordingly, where the act is not specific then common law, not inconsistent with the Act, is relevant. English decisions pursuant to Schedule 2.2 of the Second Schedule of the Constitution are therefore authoritative, while Australian decisions and those of other jurisdictions may be persuasive. See: Tei Abal v Anton Parau [1976] PNGLR 251; Telegraph Newspaper Co Ltd v Bedford [1934] HCA 15; (1934) 50 CLR 632; Clines v Australian Consolidated Press Ltd [1966] NSWR 481.
Illustrative of this is the comment in Calwell v Ipec Australia Ltd (1975) CLR 321 regarding the 1958 NSW Defamation Act (which, in respect of qualified protection, was word for word with our s 11). The Court said that whether or not the Act should be interpreted without any presumption based on pre-existing law, it is hardly possible to do otherwise since the "terms of the Act do not (themselves) throw any significant light on the problem."
The Defamation Act commences with a definition of defamatory matter. Section 2 of the Act states:
"2 (1) An imputation concerning a person, or a member of his family, whether living or dead, by which -
(a) The reputation of that person is likely to be injured; or
(b) he is likely to be injured in profession or trade; or
(c) other persons are likely to be induced to shun, avoid, ridicule or despise him, is a defamatory imputation...."
Again, by Section 5 of the Act, publication of defamatory matter is prima facie unlawful:
"5. It is unlawful to publish defamatory matter unless the publication is protected, justified or excused by law."
There is no obligation on a plaintiff in an action for defamation to prove that the defamatory words spoken or published of him are untrue because the law presumes this is in fact the case. Therefore once a plaintiff establishes that words or matter, defamatory to his reputation, has been published, he has established a prima facie action for damages. As a matter of law, it is for the Court to decide whether or not any matter published is defamatory or not or is capable of bearing a defamatory meaning (s 2(3)).
The defendants, at trial, have formally acknowledged the statement as defamatory, and that they caused publication of it in the newspapers as the plaintiffs claim. However, the defence claims the protection accorded to publications of defamatory matter set out in the Defamation Act.
The defence acknowledgment is appropriate. There can be no doubt that the allegations against the plaintiffs, jointly and severally are defamatory. It is not necessary to single out and rule on each individual statement defamatory of the plaintiffs but assertions such as "PNG Aviation Services and its principals are completely untrustworthy and dishonest ...." that it is "a disreputable foreign owned Company, that the Company deliberately - and with criminal intent - sought to defraud the Papua New Guinea Government during the negotiations leading up to the sale of the Kumul 1" are of themselves seriously defamatory and indicate the tenor of the assertions made throughout the statement regarding the Company and each of the individual plaintiffs who are singled out in a similarly harsh and defamatory manner. It is, therefore, the ruling of this Court that the "Statement by Prime Minister Michael Somare in reply to statement by Opposition Leader Wingti, on August 16th 1985" and subsequently published outside of Parliament is defamatory of the plaintiff company and each plaintiff individually.
The absolute immunity members of Parliament have from civil and criminal liability for anything said or done in the course of Parliamentary proceedings is not provided for in the Defamation Act. That comes from the Constitution (s 115(4)) and the common law. The Defamation Act provides further qualified protection or immunity from civil or criminal liability. The essential basis of this protection is that defences will not be available if the defamatory statement is published other than in the circumstances the Act provides for, and will, in any case, be forfeited if publication is not made in good faith. The defence specifically relies on the protection afforded by Sections 8, 9 and 11 of the Defamation Act.
The first of these is the protection afforded to reports of matters of public interest. The relevant parts of Section 8 of the Act read as follows.
Public Reports
"8 Protection: reports of matters of public interest.
(2) For the purposes of this Act, it is lawful to publish in good faith for the information of the Public -
(a) a fair report of proceedings of Parliament or a Committee or the Parliament; ...."
Section 8 (3) enlarges on that by providing that:
(3) "A publication is made in good faith for the information of the Public if the person by whom it is made is not actuated in making it by ill will to the person defamed or by any other improper motive, and if the manner of the publication is such is ordinarily and fairly used in the publication of news."
The defence says that the statement of the Prime Minister that was published was obviously a fair report of proceedings of Parliament published with the intention of providing information for the Public. It must be a fair report since it was precisely identical with the speech given in Parliament and "nothing could be fairer than precision." Obviously the public was informed by such a report. They said this Court should be slow to attribute malice here in Papua New Guinea. The evidence here shows that in both debate and its reporting, and on occasions, advertising, the language of politics and dispute in this country is often very robust. It sometimes occurs that the newspapers are selective and effectively partial, and that a fair report therefore can only be obtained in the manner adopted. The defence was, therefore, made out and could only be defeated if the plaintiffs could show, first that it was not a publication "such as is fairly and ordinarily used in the publication of news" and secondly, that it was not made in good faith.
Counsel for the defence pointed out that the onus of establishing these issues lay with the plaintiffs. As to the standard of that proof, he submitted that, notwithstanding that the standard of proof in civil matters need only accord to the balance of probabilities, the proof required in such matters as are before this Court should be appropriate to the seriousness of the matters to be proved. That is an apt description of the standard required in these matters and is adopted by this Court.
Counsel for the plaintiffs accepted that, while a fair and accurate report is protected by s 8, he maintained there is clearly a distinction between a report of a Parliamentary speech and a republication of that speech by its maker outside the House. No privilege or protection under the Act lies there.
I am satisfied that this is so. The position at common Law is clear. R. v Lord Abingdon (1794) 170 ER 337 and R. v Creevey (1815) ER 102 cited by both Counsel are long standing authorities for the proposition that republication of Members speeches outside of Parliament is not protected. These cases are also cited by Fleming The Law of Torts (7th edn., 553) where it is said:
"... Members of Parliament enjoy absolute immunity from civil and criminal liability for anything said in the course of Parliamentary proceedings. This protection, however, does not extend to republication by Members of their speeches out side the House."
A more modern authority is Dingle v Associated Newspaper Ltd [1961] 2 QB 162, 188 where Devlin LJ, states:
"Privilege attaches to form or occasion but not to substance. What a Member of Parliament says in the House of Commons is privileged; the repetition of the very same words outside is not. A report of a judicial or parliamentary proceeding may be privileged, but if the substance of the matter were cast into another form, the publication is subject to the ordinary law. The object of the privilege is so that the public can obtain a fair report of what is said and decided in Parliament and in courts of law; it is not to confer a licence on anyone to handle the subject-matter thereafter in whatever way he wishes."
At common law then, the publication complained of is not protected and the plaintiff’s claims must succeed.
Turning to the defence claimed under the Act, s. 8 of the Defamation Act protects a fair report published in good faith for the information of the public. A report as distinguished from comment is a factual recounting of events or proceedings. It need not be a detailed, word for word, account, but it must not be slanted or distorted. It must be at least a fair analysis or summary of the proceedings being reported.
As was said in Anderson v Nationwide News Pty Ltd (1970) 91 WN (NSW):
"A fair report of ... proceedings does not however require to be a verbatim account of those proceedings or their result. It is sufficient to publish a fair abstract, a fair analysis, and a fair summary of those proceedings but to gain the protections of [the Defamation Act] the abstract, analysis or summary must ... retain substantial accuracy in all material aspects. A report which contains untrue statements in a material particular ... prejudicial to a Plaintiffs reputation must be regarded as an unfair report of proceedings as far as the Plaintiff is concerned".
Fairness relates to the accuracy of the report of what was said and done in the proceedings reported, not to the content or otherwise of statements made in those proceedings. The reporter, therefore, must get the basic facts right. As was stated in Fleming Law of Torts (7th edn):
"The report ... must be substantially accurate, although of course the speech that is being reported may be riddles with falsehood".
Counsel for the plaintiffs also pointed out that, even if the publication was somehow permissible, it could hardly amount to a fair report of the proceedings of Parliament since it was limited to a repeat of only the first defendant’s speech. That is the report of one speech in isolation not one in the context of debate. On the authority of R v Abingdon and R v Creevey, Counsel maintained that the report of a single speech out of several is not a fair report of a debate or days proceedings and is not protected.
That is so, but there is reference to other speeches in the statement complained of and it describes itself as a ‘statement in reply to a statement’. There was also evidence in this Court that reports of other speeches on similar issues leading up to this statement had already been in the press. These tend to support a claim of it being a report of an ongoing matter before the public.
Putting aside the challenge of republication, then insofar as the report is required to be substantially accurate, the verbatim report of the first defendant’ speech may well be said to be a "fair report" under s 8 as the defence contends. It can be accepted too, that it was published to disseminate the speech "for the information of the public" as provided in the section. However, it cannot be said that "the manner of publication is such as is ordinarily and fairly used in the publication of news" as required by s 8(3).
In the first place, it is an advertisement. It appears in all the newspapers in the form of an advertisement and under the emblem of the Independent State of Papua New Guinea. Further, in the Times of PNG on Saturday, August 18th 1985 the publication is headed "Advertisement".
An advertisement, a paid announcement, is not the manner in which proceedings of Parliament are ordinarily reported. In general, publication is made by journalists or other independent report rather than by the participants of the debate themselves. Though such advertisements have become more frequent in recent years, it was acknowledged by the first defendant that this was not the case at the time of this speech. In evidence, he agreed that this was the first time that any Member of Parliament had used an advertisement to publish a speech made in the House.
Again, the publication of the speech (in four newspapers) under the State emblem to my mind, further removes it from the scope of being a fair report, in terms of s 8. In fact, it enhances its being viewed as an assertion of fact or a statement, made with the authority of the State. Such an element of official pronouncement inevitably must prejudice the fairness that is required for a balanced report and the fairness required as to the manner of its publication.
There is the further issue of good faith that is a concomitant of all the defences under the Act. It has been the central submission of the plaintiffs throughout that the publication was motivated by ill will, and even if somehow there were, any privilege in the publication; then that defence, that protection, was lost by the issue of the publication for improper and wrong motives, namely the deliberate attack on the character and reputation of the plaintiffs. I will return to this later. But even aside from the issue of good faith, for the reasons already set out, I find that the statement is not a fair report published in the manner ordinarily and fairly used in the publication of news. The protection of s 8 of the Defamation Act, therefore, cannot avail of by the defence in respect of this publication.
The defendants also rely on the defence of fair comment contemplated by s 9 of the Defamation Act.
It is a defence to an action of defamation to show that the words complained of constitute a fair comment on a matter of public interest. (Gatley, Libel and Slander 8th edn 69). Section 9 of the Defamation Act gives statutory effect to this defence. The relevant part of that section provides:
(1) For the purposes of this Act, it is lawful to publish a fair comment:
(a) respecting any of the matters with respect to which the publication of a fair report in good faith for the information of the public is declared to be lawful by Section 8; or
(b) respecting:-
(i) the public conduct of a person who takes part in public affairs; or
(ii) the character of any such person, as far as his character appears in the conduct; or
(c) respecting:-
(i) the conduct of a public officer or public servant in the discharge of his public functions; or
(ii) the character of any such person, so far as his character appears in that conduct; or
(d) respecting a communication made to the public.
(2) Whether a comment is or is not fair within the meaning of this Act is a question of fact.
(3) If a comment is not fair, and is defamatory, the publication of it is unlawful.
Gatley, para 692 cited by defence counsel sets out the basis of this defence:
"692. What must be proved? To succeed in a defence of fair comment the defendant must show that the words are comment, and not a statement of fact. He must also show that there is a basis of fact for the comment, contained or referred to in the matter complained of. Finally, he must show that the comment is on a matter of public interest, one that has expressly or implicitly put before the public for judgment or is otherwise a matter with which the public has a legitimate concern. If, however, the plaintiff can show that the comment was not made honestly or was actuated by malice, he will defeat the plea".
It must be emphasised that when pleading fair comment, a defendant is pleading a defence to comment only; a defence regarding an assertion of opinion made about particular facts. There must be a basis of true facts to support the comment. Law protects a comment shown to be fair on proven facts; an allegation of defamatory facts is not. In Gorton v ABC (1973) 22 FLR 181, it was held that:
"In a defence of fair comment if the facts on which comment is based are stated, they must be shown to be true. It is sufficient that comment on them be fair. But the comment cannot be fair if the facts are misstated".
In other words, if the facts on which comment is based are not true the defence fails.
The separation of fact and comment is vital. Comment must be recognisable as comment. If fact and comment are so mixed up such that the one cannot be separated from the other, the publication will stand as an assertion of fact and this not amenable to a defence of fair comment. The Privy Counsel in Davis v Shepstone [1886] UKLawRpAC 12; (1886) 11 AC 187 declared:
"the distinction can not be too clearly borne in mind between comment or criticism and allegations of fact ... it is one thing to comment or criticise, even with severity, the acknowledged or proved acts of public man and quite another to assert that he has been guilty of particular acts or misconduct".
The essence of the defence of fair comment then is that the words challenged must be comments, not assertions of fact, and not only must the comments be comment, but fair comment on facts truly stated.
Counsel for the defence referred to Gatley (para 696) as providing a clear a summation of the meaning of fairness. It reads (in summary) as follows:
Fair Comment.
Not all comment is protected; the comment must be fair.... What is the meaning of fairness...? First the comment must be based on facts, stated or indicated in the matter complained of. If the facts are not so stated or referred to, then a statement of opinion will be in the same position as an allegation of fact.....
Secondly, the comment must be supported by the facts, or there must a basis of fact sufficient to warrant the comment made....
Thirdly, the facts stated in the libel must be truly stated, or if some are not proved to be true then the Defendant must show that the expression of opinion is fair comment having regarding to such facts .... as are proved.
Fourthly the comment must be such as can be fair called criticism, and not be merely invective. Finally, the fact that the comment was made maliciously - or is not the expression of the author’s real opinion will also make the comment unfair.
Except for reservations about the third proposition, which I will return to, these propositions of the learned authors are unchallenged.
The plaintiffs, however, denied that any of the defamatory material, insofar as it relates to the plaintiffs, was in any way an expression of opinion. It was mere assertion of fact. Nor had the defendants established that the words complained of in the statement made would have been understood by any reasonable reader of the publication to be merely expressions of opinion and not a bold statement of facts.
They said the statements made in respect of the plaintiffs were not comments in respect of proceedings of Parliament (s 9(1)(a)) nor was any defence available under s. 9 (1)(b)(i)(ii)) since the plaintiffs are not persons who had taken any part in public affairs.
Plaintiffs’ counsel submitted that none of the matters postulated as comment could be said to be fair comments on facts, since the supposed comments made are founded on statements about a contract with the Government, which were not true. These statements were, in any case, not expressions of the first defendant’s genuine opinion because all he did was read the speech prepared by others. There was plain evidence as well that he was in fact motivated by an intention to harm the plaintiffs.
Section 9(1)(a) of the Act protects fair comment on matters contained in a fair report declared to be lawful by s 8. In this instance, the defendant’s statement has not been declared lawful in terms of s. 8 so the defence in respect of comment on this head is therefore no longer available.
But putting that aside and considering the defence in Section 9(1)(a) on its own merits, the strength of that defence rests on proof of fair comment on facts truly stated, just as it also applies to the other defences put forward under s 9.
The defence would plainly be available in respecting a communication to the public under s 9(1)(h) and in respect of the character and conduct of a public officer (s 9(1)(c)) such as the Leader of the Opposition. Much is recorded regarding him in the statement. However, the defence submits that comment on the plaintiffs is permissible under s 9 (1)(c) because contracting with the Government is "inevitably to participate in public affairs." This is too sweeping a generalisation.
The defence has suggested that when Mr Mendoza gave information to the Leader of the Opposition about the matters in issue, he must have known they would provoke public attention and would be raised in Parliament. He was then entering the public arena. While it is true that persons contracting with public bodies or those who may be the sources of a Parliamentarian’s material may be open to scrutiny, I do not accept that the mere fact of contract, or the answering of questions of, or supplying information to, a Member of Parliament, means that person is engaging in public affairs.
Public affairs are those matters and issues that are the concern of the community at large. The management and control of public bodies or services, and the conduct of national and local government are obvious examples. Persons holding or seeking public office are clearly taking part in public affairs. But, where a person’s standing in relation to a public body or figure arises from contract alone, I would hold that person is not taking part in public affairs. A person or company supplying office furniture or stationery to a Government Department can hardly be said, to be taking part in public affairs nor in my view would be a person or company contracted to sell surplus Government vehicles. Further reason and evidence would be needed to shift that person to the public arena.
Accordingly I rule that a defence of fair comment is not open to the defence under s 9(1)(b) or (c) in respect of the plaintiffs. It is under s 9(1)(h). Obviously, there has been communication to the public.
There was real dispute over truth of the facts in this matter and in particular in respect of the contract of agency for the sale of the Kumul 1. Defence counsel contended the necessary basis of fact had been proved. He said:
"Overwhelmingly, the comments are based on factual matters referred to in the speech. The facts are true by and large. Mathematical provision is not required the arrangement with the Government that the plaintiffs had were restricted ones; the "escrow agreement" was ambiguous; the plaintiffs had inaccurately described the conditions of the aeroplane in Copenhagen; the Government had incurred considerable expense in checking on its condition; there was a purely commercial dispute between the plaintiffs and others regarding any entitlements to commission; and, the government was exercising considerable caution in dealing with the plaintiffs. This is a clear substratum of fact to support the comments that were made".
The defence has submitted that the facts just referred to are true ‘by and large’ and support the comments made. But the defence of fair comment depends on the defendant proving that each and every statement of fact in the words complained of is true. If a defendant fails to prove the truth of any one of the statements of facts alleged, the defence fails.
Earlier I referred to reservations as to the statement in para 696 of Gatley relied on by the defence. That is that if some facts are not proved true, then the defendant must show that the expression of opinion is fair comment simply having regard to such facts as are proved. This proposition of Gatley takes its authority from s 6 of the UK Defamation Act 1952, which makes such a provision. The NZ and several Australian Defamation Acts have similar sections. There is no equivalent provision in Chapter 293. While undoubtedly insignificant error would not preclude such a defence, basic contentions supporting comment must be shown to be true, and not just ‘by and large’.
Turning to the statement itself, on 16 August 1985, the first defendant was replying first of all to an assertion by the Leader of the Opposition, quoted in the statement, that documents tabled by the Leader were:
"proof that PNG Aviation Services was appointed sole agent for the sale of Kumul 1"
The first defendant in the statement denies this was so. He said, "the Leader of the Opposition has been manipulated by a disreputable foreign owned company" that "PNG Aviation Services have repeatedly tried to mislead and cheat this Government." Such agreement as the Government had with the Company he said was merely a "preliminary agreement," "an escrow agreement", "merely a conditional agreement" ... "not a firm contract, and it is an agreement conditional on certain actions." The statement continues, "PNG Aviation Services did not fulfil the conditions of escrow and it lapsed". The statement goes on to assert:
"PNG Aviation Services failed in their bid to become an agent for the aircraft".
"PNG Aviation Services were not appointed as official agents".
"They were not official agents of the PNG Government."
The evidence before this Court has shown that in fact PNG Aviation Services had been appointed official agent of the PNG Government for the sale of Kumul 1 on 3 August 1983 by the Minister for Finance. The instrument of appointment reads:
"The Independent State of Papua New Guinea has appointed PNG Aviation Services Pty Ltd. of Port Moresby, Papua New Guinea as sole agent to sell on behalf of the said Independent State of Papua New Guinea and in accordance with the Escrow Instructions One (1) Gulf Stream II Aircraft presently in Copenhagen, Denmark, together with associated spares presently in Papua New Guinea.
This will involve arranging for the inspection of the Aircraft and spares at their respective locations and implementation of the Escrow procedure approved by the Independent State of Papua New Guinea.
MINISTER FOR FINANCE".
As is set out in that instrument, the ‘Escrow procedure’ did not place any conditions on the appointment. That simply related to the conditions for implementation of sale.
Before the Court, the first defendant acknowledged that he was in fact aware of the appointment at the time of delivering the speech in the House. He acknowledged too that his assertions of the conditional nature of the appointment were without any legal advice. The speech had been prepared by his staff he said.
Passages from his evidence show this:
In cross-examination, the first defendant was referred to the passage in the statement: "The state solicitor has expressed a preliminary opinion that the State has civil legal rights against Mr Valentine for negligent misstatement and injurious falsehood or slander of title. I have issued instructions for the State Solicitor to be fully briefed and to institute proceedings .." He reasserted his belief that legal advice has been taken, though; he did not state that he had in fact given instructions to institute proceedings.
And regarding the appointment itself.
Did you read this document before making your speech? It’s signed by Mr Bouraga, Minister for Finance?
Plainly then, to say that the Company had not been an appointed agent was to misstate basic fact. The first defendant then goes on to assert that:
"PNG Aviation Services and its principals are completely untrustworthy and dishonest.
That the company deliberately and with criminal intent - sought to defraud the Papua New Guinea Government during the negotiations leading up to the sale of Kumul 1"
The first defendant goes on to say that:
"... to substantiate these allegations, I table two documents".
Here, it might be said, are allegations of opinion or comment followed by the factual basis said to justify them.
"The first consists of information provided to a Minister Sir Barry Holloway by Mr Valentine of PNG Aviation Services. The second as the report of the official Government inspection of the aircraft, which was, prompted by Mr Valentine ... Sir, document one makes a number of spurious allegations about the condition of Kumul 1. Mr Valentine claims the interior of the plane was in terrible condition. It had been left on the tarmac and so on.
Sir all these were later proven complete lies ... PNG Aviation Services were trying through innuendo and slander to under cut their rivals. Sir these were serious accusations, so my departmental head Mr Yauieb immediately ordered an officer of Civil Aviation, ... Mr E.C. Johnston, Superintendent of Airworthiness to fly to Copenhagen to inspect the aircraft. His report is Document 2.
Sir this document shows there was nothing whatsoever wrong with the aircraft. It also shows the information supplied to my Government by Mr Valentine was completely misleading and false ... Sir, PNG Aviation Services role in this incident can only be described as criminal or negligent.
The evidence shows that in fact the two documents tabled to substantiate allegations of criminality or negligence do not bear them out. In the first document, Mr Valentine reports the concerns of a Mr Ford regarding the condition of the Kumul 1 when he (Ford) and a prospective purchaser viewed it in Copenhagen. The letter reports Mr Fords suggestion that an inspection should be made to verify his concerns. There is no statement by Mr Valentine in the letter that amounts to a criticism of the aircraft by himself or PNG Aviation Services. The second document, the report of Mr Johnston, while not supporting Fords complaints in total, found there was some basis for his concerns. At the time PNG Aviation Services were already appointed agents for sale. That had occurred just two days prior. The Company, therefore, has "no rivals to undercut, libel or slander." Arguably, it would have been improper for the plaintiff company having received such a report to have suppressed it.
These matters were raised in the Pelair inquiry and the relevant parts were put to and acknowledged by the first defendant as correct. That portion of the report was exhibited without objection, not as evidence of those matters in this trial but as evidence of what was said regarding them at that enquiry.
It is clear that the defence of fair comment cannot stand. The facts on which the supposed comments were made regarding agency and the state of Kumul 1 were simply not true. The defence has failed to show such a basis of true facts to support comment. When facts are misstated, any comment cannot be claimed as fair and on this ground the defence must fail. There is also force in the plaintiff’s submission that if these comments were prepared by the first defendant’s staff, they cannot be said to be the comments of the first defendant.
But, even if the summary of facts outlined above by defence counsel were to be considered as a basis for comment, on any reading of it, there is nothing there on which to found the allegations of corrupt and dishonest motives on the part of the plaintiffs. I am satisfied that the allegations that PNG Aviation Services was a disreputable foreign owned company whose principals were completely untrustworthy and dishonest, and acting with criminal intent etc., are not only unfounded in fact but are unproven. They cannot be fairly described as comment or criticism. They stand an unfounded defamatory allegation of fact and the defence of fair comment fails.
Next are the defences of qualified protection raised under Section 11 of the Act.
While the law of defamation is primarily concerned with the protection of the rights of individuals to their good reputation, it also provides for occasions when the publication of defamatory and untrue statements may be excused. The law recognises that persons should be allowed to speak freely on occasions when they have a duty to do so or where it is justifiable in defence of some particular interest. But the immunity from liability on those occasions does not create opportunity for unrestricted invective or abuse. The privilege is qualified. It is wholly conditional on the use of the occasion being used properly and in good faith. Lack of honest belief or improper use of the occasion renders the publisher liable for defamatory statements.
In Horrocks v Lowe [1975] AC 135 which is the definitive English decision on qualified privilege and which decision is also authoritative in Papua New Guinea, Diplock, LJ. explains this as:
The public interest that the law should provide an effective means whereby a man can vindicate his reputation against calumny has nevertheless to be accommodated to the competing public interest in permitting men to communicate frankly and freely with one another about matters in respect of which the law recognises that they have a duty to perform or an interest to protect in doing so. What is published in good faith on matters of these kinds is published on a privileged occasion. It is not actionable even though it be defamatory and turns out to be untrue.... the privilege is not absolute but qualified. It is lost if the occasion which gives rise to it is misused. For in all cases of qualified privilege there is some special reason of public policy why the law accords immunity from suit - the existence of some public or private duty, whether legal or moral, on the part of the maker of the defamatory statement which justifies his communicating it or of some interest of his own which he is entitled to protect by doing so. If he uses the occasion for some other reason he loses the protection of the privilege.
So, the motive with which the defendant on a privileged occasion made a statement defamatory of the plaintiff becomes crucial. The protection might, however, be illusory if the onus lay on him to prove that he was actuated solely by a sense of the relevant duty or a desire to protect the relevant interest. So he is entitled to be protected by the privilege unless some other dominant and improper motive on his part is proved. "Express malice" is the term of art descriptive of such a motive. Broadly speaking, it means malice in the popular sense of a desire to injure the person who is defamed and this is generally the motive, which the plaintiff sets out to prove. But to destroy the privilege the desire to injure must be the dominant motive for the defamatory publication; knowledge that it will have that effect is not enough if the defendant is nevertheless acting in accordance with a sense of duty or in bona fide protection of his own legitimate interests.
The motive with which a person published defamatory matter can only be inferred from what he did or said or knew. If it be proved that he did not believe that what he published was true this is generally conclusive evidence of express malice, for no sense of duty or desire to protect his own legitimate interests can justify a man in telling deliberate and injurious falsehoods about another, save in the exceptional case where a person may be under a duty to pass on, without endorsing, defamatory reports made by some other person.
Apart from those exceptional cases, what is required on the part of the defamer to entitle him to the protection of the privilege is positive belief in the truth of what he published or, as it is generally though tautologously termed, "honest belief". If he publishes untrue defamatory matter recklessly, without considering or caring whether it be true or not, he is in this, as in other branches of the law, treated as if he knew it to be false.
This qualified privilege under the common law is described in the Defamation Act (perhaps more appropriately) as qualified protection: excuse. Section 11 states:
(1) For the purposes this Act, it is a lawful excuse for the publication of defamatory matter if the publication is made in good faith -
(c) for the protection of the interest of a person making the publication or of some other person, or for the public good; or
(e) for the purpose of giving information to the person to whom it is made with respect to some subject as to which that person has, or is believed on reasonable grounds by the person making the publication to have, such an interest in knowing the truth as to make his conduct to making the publication reasonable under the circumstances; or
(h) in the course of, or for the purposes of, the discussion of some subject of public interest, the public discussion of which is for the public benefit, and if, so far as defamatory matter consist of comment, the comment is fair.
(2) For the purposes of this Section, a publication is made in good faith, if -
(a) the matter published is relevant to the matters the existence of which may excuse the publication in good faith of defamatory matter; and
(b) if the manner and extent of the publication do not excess what is reasonably sufficient for the occasion; and
(c) if the person by whom it is made -
(i) is not actuated by ill-will to the person defamed, or by any other improper motive, and
(ii) do not believe the defamatory matter to be untrue."
Section 11 provides a lawful excuse for the publication of defamatory matter, conditional on it being published in circumstances or on occasions provided for in the section, and conditional on it being published in good faith. If the defamatory matter be comment, the comment must be fair. The section does not protect or excuse defamatory material if it is not relevant to the matters for which protection is claimed. The manner and extent of publication must be no more than is sufficient for the occasion and there can be no improper motive for publication. That is, there must be no motive that would be an abuse of the occasion. Finally, the defendant must believe the defamatory material is true. Essentially then, the common law of qualified privilege is now stated in s 11 of the Act.
It is for a defendant to prove that the publication was made on a protected occasion and that the duty or interest relied on by the defamation excused, not just any publication he might make but the specific publication actually made. If the occasion is privileged or protected then prima facie any defamatory statements are excused.
The absolute protection from liability for defamatory statements made by a Member of Parliament in the House does not require or even permit examination or analysis of what was actually said. Because the occasion has absolute protection, it follows that everything said on the occasion is protected. However, a defendant does not establish qualified protection to excuse defamatory statements under s. 11 until he shows that the publication was made on a protected occasion, had valid reference to such an occasion and was published in good faith. The fact that an occasion of qualified protection may arise does not constitute an occasion whereby a person is excused of any defamatory allegation he may choose. As stated in Clerk & Lindsell, Torts (17 edition) 21-108.
"A communication on a privileged occasion, therefore, is not necessarily a privileged communication. It is not enough to have an interest, or duty in making a communication, the interest or duty must be shown to exist in making the communication complained of."
The first task of the Court is to determine whether publication was made on such a protected occasion. This is largely a question of law, and what is actually said or the truth of it will not usually be relevant in determining whether the occasion was one of qualified protection. As stated in Pervan v The North Queensland Newspaper (ATR 1991 CCH 6946) while the truth or belief in the truth "may have an indirect bearing on the nature of the occasion ... they are not preconditions to the application of the section". Telegraph Newspaper Co Ltd v Bedford [1934] HCA 15; (1934) 50 CLR 632.
In Pervan’s case cited above, it was held that in ruling whether an occasion was protected:
"Questions of degree, public policy, propriety, moral rights and duties inevitably came into the judge’s decision. Factors such as the extent of the publication, the circumstances, including who published it, when, why and in what circumstances, and anything that assisted in indicting whether there was a relationship between the parties giving rise to a social or moral right or duty could all be relevant factors according to the particular plea under consideration. .... The trial Judge’s ruling was therefore essentially a provisional ruling on the capability of the evidence of establishing the occasion to be a privileged one, .... The plaintiffs bore the onus in relation to showing absence of good faith, but in giving the provisional ruling this could prima facie by assumed in favour of the defendant who otherwise established the privileged occasion. If good faith was to be an issue it was then for the plaintiff to prove the absence."
But consideration of the facts and circumstances of publication including some which are also aspects of good faith, such as relevance or extend may also be necessary to determine if the occasion is protected.
In Justin v Associated Newspapers (1966) WN (Pt.1) (NSW) 17 p.52, Jacobs, J. deals with the determination of an occasion of qualified protection under s 17 of NSW Defamation Act 1958. That section is word for word with our s 11. He said: there is a proper place for consideration of relevance and manner of extend of publication upon the issue of good faith and so the statute provides. But because these are proper questions for the jury on the issue of good faith, it does not follow the same matters and may not arise upon the questions for the Judge which fall for determination of whether an occasion is protected or not.
With respect, it seems to me that this is correct. The fact that circumstances of a protected occasion may arise does not mean that those circumstances alone are sufficient to create the protected occasion and that thereafter the only matter left is to consider any challenge to good faith. Case law shows this is not so.
Essentially, the Court upon deciding such facts as maybe necessary, must decide whether an occasion carries protection or not, before proceeding to consider the challenge of lack of good faith. Such a procedure follows the common law and the intent of s 11.
The plaintiff’s counsel maintained that the first defendant could not claim that the publication was for the protection of his interest any more nor could the second defendant claim protection of its interest in peace, order and good government. To establish the protection of publication for the public good, the defendants needed to show that publication was made for the public good and that that was the purpose of the defendant. It was submitted that the defence had failed to show either. The publication of defamatory assertions (as is the case here) was seldom, if ever, justified for the public good (Traill v Australian Broadcasting Corporation [1988] Tas. R. 1) and more relevantly, the defendants purpose in publishing the defamatory matter was to denigrate (if not destroy) the plaintiffs. As for claims of discussion of a subject of public interest - no discussion took place either before or after the publication which could in any way give rise to an occasion of qualified privilege. There was, in any case, only an advertisement of an assertion of fact.
The defence of qualified protection pleaded in paragraph 4 (c), (d) and (e), of the defence fall under s 11 (I) (c); that is the publication was published in good faith for the protection of the interests of the 1st and 2nd defendants and for the public good.
It is clear law that an attack on a defendant may be visited with a reply on the attacker in equally strong perhaps or even stronger terms. Such a reply may be protected even if it contains defamatory, even untrue matter. But the protection does not afford an opportunity for retaliation without restriction. The reply must be made in good faith in terms of the section. As stated in Gatley, para. 514.
"A person whose character and conduct has been attacked is entitled to answer such attack, and any defamatory statements he may make about the person who attacked him will be privileged, provided they are published bona fide and are fairly relevant to the accusations made. The law justifies a man in repelling a libellous charge by a denial or an explanation. He has a qualified privilege to answer the charge; and if he does so in good faith, and what he publishes is fairly an answer, and is published for the purpose of repelling the charge, and not with malice, it is privileged, though it be false".
Reported decisions emphasise that while violence of language is not necessarily sufficient to take away protection and while it is the case that extravagance might also provide evidence towards establishing malice, nonetheless protection can and will be lost if the "defensive" reply becomes a counter attack raising allegations unrelated or insufficiently related to the attack made on the defendant.
"The privilege ... extends only so far as to enable (a defendant) to repel the charges brought against him - not to bring fresh accusations against his adversary. This privilege is in fact a shield of defence, not a weapon of attack". Dwyer v Esmonde (1878) 2 ILR.
Similarly, in Brewer v Chase [1899] American St. Reports 532.
"It must not be supposed, that when a libellous article is published, the person libelled is at once authorised to publish any and all kinds of charges against the offender, upon the theory that they tend to degrade him and thereby discredit his libellous statements.... The thing published must be something in the nature of an answer like an explanation or denial. What it said must have some connection with the charge that is sought to be repelled".
While obviously the attack in this instance was made by the Leader of the Opposition, it was contended that the plaintiffs made themselves party to that attack. Defence counsel summarised the facts that the defence asserted were the basis of this defence:
"Mr Mendoza had supplied papers and information to Mr Wingti; who used those materials to bitterly attack Sir Michael in Parliament, alleging against him corruption of the most serious kind in his office as Prime Minister. He, Sir Michael, using only information provided to him by very senior civil servants whose reliability had never been questioned, strongly defended himself in Parliament. The attack, which he sought to meet, was made, not only upon him but also on the Government of the country. He is, Sir Michael, entitled in his own and his Government’s interest, and for his, and the Government’s protection, to make the response he did."
Such circumstances of publication, if proved, are capable of amounting to an occasion of qualified protection provided that the plaintiffs had actually allied themselves with and aided in the attack as claimed. There is no protection or excuse for defaming persons not party to the attack.
In his evidence in chief, the first defendant said, following questions in the House commencing on 4 June 1985 alleging improper influence in the sale and purchase of aircraft and involvement in drug matters:
"I couldn’t respond there and then. I put the questions on the notice paper. I needed staff to research.
I personally had no information regarding the sale of aircraft or in respect of the matters in question apart from a denial of personal involvement in the allegations.
In the cross examination, the first defendant was questioned first on the completeness of his speech:
You knew Lussick had no day-to-day dealings with PNGAS.
Mr Mendoza was closely questioned as to what part he had played in the attack on the Prime Minister. It was put to him that he was fully aware that the material he had supplied to the Leader of the Opposition was to be the ammunition for that attack. He denied this. The evidence was as follows:
But it was a Government-to-Government sale - payment to the manufacturer who would distribute commission.
You know of Times publication.
The evidence of Mr Valentine or Mr Lussick added nothing on the issue, supplying information to the Opposition Leader.
The net of all this evidence in respect of the assertion of publication for the protection of the reputation and interest of the defendants is that (1) the attack being replied to was that of Mr Wingti, the Leader of the Opposition. The defamatory statement names itself as such. (2) There has been no credible evidence that gives any reasonable cause to believe that the plaintiffs and Mr Mendoza in particular, were party to that attack. Mr Mendoza denies any such knowledge or participation. The first defendant says no more than that he had no personal knowledge of the company, PNG Aviation Services or of the aircraft sales. He was not aware of the legal implications of the documents. He believed Wingti had attacked him with the assistance of PNG Aviation Services though he did not know who, if any, individuals from that company had been involved. He believed all this because of what his staff had prepared in the statement for him.
The giving of contract information or the handing over of documents is not enough. The defence has simply failed to link the plaintiffs with the Leader of the Opposition’s attack. There is no protection under s 11(1)(c) for attacks on persons who have themselves made no attack. Even if it were, the case that Mr Mendoza in speaking to the Leader of the Opposition concerning the aircraft sales or by his showing of documents to him had in some way added to, promoted full discussions, or even provoked the controversy, the fact that Mr Mendoza himself made no attack on the first defendant precluded any protected occasion arising for a defamatory reply, whether by way of defence or retaliation. The same applies to PNG Aviation Services.
Simply stated that means, asking or answering questions; raising controversial issues without making any attack on a person does not give rise to an occasion of qualified privilege under s 11(1)(c), for an attack in reply. See Loveday v Sun Newspaper (1938) 59 CLR 513; Church of Scientology v Anderson [1980] WAR 81.
The defence also pleaded that publication had been made for the public good para. (4(e)). Defence counsel submitted:
"The question is whether the publication was made for the public good, and that does not require, as in a defence of justification, the proof of actual truth of the matter published. It was plainly for the public good (and in the public interest) that all of the circumstances surrounding the sale and purchase of valuable Government property, and the role of the Prime Minister, his Government, and other parties involved, be discussed and published."
It is stated in Justin v Associated Newspaper (1966) that:
"The defence, "for the public good" refers to occasion when the public or a section of the public have a interest in receiving the communication. Such an occasion is to be distinguished from any private occasion which may justified of defamatory matter for protection of the interest of a person or a class of persons.... however such a publication would not in my view be for the public good unless it be assumed that the public generally or a section of the public have an interest in receipt of the defamatory matter".
On p. 53 the learned judge goes on to say that, to establish publication for the public good, the defence must show: "First there must be a purpose of serving the public good. Secondly there must be an effect by the publication of serving the public good".
In Bridges v Australian Consolidated Press (1967) 2 NSWLR, it was said at p.521:
"The crucial question, therefore in the present case is whether it was for the public good that matter be published of and concerning the Plaintiff which.... meant that the Plaintiff had conspired to cheat and defraud....
If it were true it might well be open to find that it was for the public benefit that it be published. However I cannot conceive that it is for the public good that such allegations be made whether they are true or false...
In my view the cases where it may be for the public good that a private individual should have defamatory matter published concerning him whether it be true or false are very limited indeed."
The first defendant in fact gave evidence that he published his speech so the people would know his response and to clear his name. As plaintiff’s counsel said, that is not a declaration of publication for the public good. But, I believe that, while this is really a claim of personal interest, a reply to allegations of impropriety over the sale of the Government aircraft was a matter of public interest and arguably it would be for the public good that a reply be made on that issue. There remains to consider whether the reply actually made is protected.
In essence, the defence contention amounts to an assertion that in answering the challenges of the Leader of the Opposition’s "statement about government negotiations leading to the sale of Kumul 1 and the purchase of Arava Aircraft for the Defence Force", it was the first defendant’s purpose, and that it was for the public good, that he makes a statement not only concerning the circumstances surrounding sale of government property but also to make specific allegations that the party claiming to be government agent for sale of the Kumul was a "disreputable foreign owned company" which Company’s officers were "completely untrustworthy and dishonest", who "deliberately and with criminal interest sought to defraud the PNG Government" over the sale of Kumul 1. The public good would be that the public is informed of the unsavoury character of the claimants and thus would be then better able to assess the validity of the Leader of the Opposition’s assertion that PNG Aviation Services was the duly appointed government agent for the sale.
That is not so. As shown in Traill’s case, publication of defamatory assertions must clearly be justifiable and not made simply as a way of degrading or discrediting a perceived opponent. In my view, there is no case here made out for the protection of the statements on the basis that it was made for the public good. The issue in the challenge and reply turned on the interpretation that should be given to the documents tabled and relied on by the Opposition Leader and the first defendant. The reputation of PNG Aviation Services or the character of its principals had no relevance to the Leader of the Opposition’s claim, and the first defendant’s denial, that PNG Aviation Services was the lawful agent of the government for the sale of the Kumul. The public cannot, in such circumstances have any interest in receiving non-relevant defamatory matter. The disparagement of parties’ reputations cannot be said to have served the public good or enhanced its ability to properly evaluate the criticism and reply. See also Sefton v Baskin [1917] NZGazLawRp 127; [1918] NZLR 157 and Brooks v Muldoon [1972] NZLR 1.
The relevance, or rather lack of relevance of defamatory assertions in that context can be seen further on in the same statement, where the first defendant deals with the dispute regarding PNG Aviation Services sub agency in the Arava sales. By contrast, the treatment of this latter issue is unexceptional. There, the first defendant answers on relevant matters without resorting to irrelevant defamatory assertions against parties.
The first defendant recognised that it was "a dispute which is purely commercial and has nothing to do with the Papua New Guinea Government.... I knew there was an agreement. But I also knew that it was a matter of legal dispute. Intercorp claim that the agreement is no longer valid due to non-performance of PNG Aviation Services. PNGAS claim it is valid and have threatened to take legal action as yet nothing has resulted".
The defence also pleads pursuant to s 11(e) of the Defamation Act that publication was made of matters of public interest, to the public which the Defendant reasonably believed was interested in the truth of such matters. Accordingly, such publication was reasonable.
Defence counsel’s submissions were:
"The matter was published to give information to the readers of newspapers. The subject matter was of Government dealings, the dealings of others in Government property, and the serious allegations, which had been made against the Government and its Prime Minister. All of the public, all of the
readers, were reasonably believed by the Prime Minister, on his own behalf, and on behalf of the Government, to have an interest in knowing the truth about those matters. And it was reasonable for the Prime Minister to cause the publication to be made in light of all of these matters, and the matters set out in the preceding paragraph of these submissions."
In my view, the publication of the statement complained of cannot be excused by the provision of s 11(e). That subsection relates to the publication of defamatory matter. That is to say, the plea in defence has to be that the defamatory matter was published for the purposes of giving information to persons interested in knowing the truth of such defamatory matters. But the assertions as to the supposed unsavoury reputations of the plaintiffs have no part in the subject matter of dealings in Government property or allegations against the defendants.
The general public undoubtedly may well have an interest in receiving information on a subject of public officers and, as here, in the dealings relating to purchase and disposal of Government property, but defamatory matter not germane to that issue was not such matter in which the public could be said to have a legitimate interest.
Further, no evidence was offered which indicated that the defendant’s publication of such defamatory matter was reasonable. The Privy Council said in Austin v Mirror Newspapers Ltd [1986] 1AC 299 at 317 that where a defence of fair comment has failed because the Court has found the facts said to base the comments to be untrue then the circumstances leading to the publication of those false facts should be scrutinised with care before concluding that it reasonable to publish them.
This is not introducing a test of truth, on belief in truth, into the process of deciding on whether the occasion was protected. It must be considered that the obligation on the part of the publisher to prove his publication reasonable. That must include evidence of some concern for the accuracy of his allegations of fact. If evidence shows there was no reasonable concern for accuracy, or as here, evidence that the publisher knew the facts were not true, it cannot be said publication was therefore reasonable.
It is unreasonable and no defence to say, without more, that he believed what someone else told him and was only repeating it. See Wright v ABC [1977] NSWLR 697 and Morosi v Mirror Newspaper Ltd [1977] 2 NSWLR 749.
The defence in para. 4(h) restates the defence set out in s 11(h) of the Act namely that the publication was on a matter of public interest in the course of or for purposes of some public discussion for the public benefit.
Defence counsel submitted that:
"Again the conditions are satisfied: there had been discussion, discussion continued, the subject was of high public interest, it was equally desirable and in the public interest that the matter be discussed and the comment was fair, within the extended meaning of that adjective."
Clearly the subject matter was of public interest but, as set out above, the publication was not made for the specific purpose of public discussion. The first defendant has said it was to let the people know his response to the Leader of the Opposition’s allegations and to clear his name. Nor can it be said to have been published in course of a public discussion.
Walsh J, in Justin’s v Associated Newspapers points out that "in the course of" does not signify merely a coinciding of the publication and discussion in the temporal sense. There must be some real relationships or nexus between them."
The reality is, there was no ongoing public discussion on this matter. There was no evidence of an ongoing discussion involving or for the benefit of the general public and the first defendants publication was plainly not for the purpose of initiating or responding to such a public discussion. His statement was simply a republication, after the event, of his response to the speech of the Leader of the Opposition in the actual public discussion, the debate that took place in the House.
The question of relevance already dealt with in relation to the defence under s 11(e) is simply further reason for declaring the occasion of publication was not one of qualified protection under Section 11(h).
This defence also fails as being a publication excessive to need. It was said in Adam v Ward [1917] AC 309:
"a man who makes a statement on the floor of the House of Commons makes it to all the world".
Thus it may be said that further publication of that statement in the press is excessive to the occasion and that any protection that might otherwise arise, is lost. I find that is the case in respect of this defence, as indeed it can be said of all the defences.
As shown by the Abingdon and Creevey cases, the absolute privilege for statements in Parliament stops at the doors of the House. But the fact of making a statement in Parliament can also effect whether an occasion of qualified protection arises.
In Stopforth v Goyer (1978) 20 O.R. (2d) 262, a decision concerning defamatory statements arising out of Government contracts for the purchase of aircraft, a Minister of Government in response to questions by reporters outside Parliament made defamatory allegations against the plaintiff in the same terms as he had in a statement in the House. When sued for defamation, he claimed qualified privilege. It was held that there was no defence of qualified privilege for two reasons:
(a) He had no duty to speak on the occasion sued upon. He had just delivered a statement to the House of Commons on an occasion of absolute privilege of the same substance and to the same effect as that for which he has been sued. Any duty he had to make the statement sued upon was thereby discharged. Statements made in the House of Commons are a matter of public record. They are recorded in Hansard and reported by the news media. The defendant added nothing when he spoke to the press in the Government lobby. Indeed, the defendant testified that he spoke to the press on this occasion to explain his view of ministerial responsibility, not because he felt he had a duty to do so.
(b) The defendant has also failed to establish the reciprocal interest or duty in the press, or the Canadian public through the press, to receive the statement sued upon. While it was a matter of public interest to learn what occurred in the DND-Lockheed transaction to cause it to be cancelled, there was no public interest in receiving the plaintiff’s identify or the plaintiff’s personal blameworthiness, if any"
The rationale of this decision is compelling. It gives a clear perspective on qualified protection, particularly with regard to the manner and extent of publication. It compliments the Abingdon and Creevey decisions regarding absolute immunity and illustrates that the immunity on an occasion of qualified protection arises only to the extent necessary to meet the needs of the occasion properly used.
I am satisfied that the defences raised under s 11 of the Defamation Act cannot be sustained. However if that were not so, there remains the plaintiffs’ challenge of lack of good faith.
Good faith
Except where the Act affords absolute protection for publication of defamatory matter, defences under the Act have, as an overriding condition for protection that the publication is made in good faith.
Section 8(3) of the Act states that publication for the information of the public is made in good faith if the publication "is not actuated by ill will ... or any other improper motive." That is also a requirement under s. 11 but that section also stipulates further specific tests for good faith. The defamatory material must be relevant to the matters for which protection is claimed. The manner and extent of publication must not exceed the needs of the occasion as well as prohibiting ill will. The publisher must "not believe the defamatory matter to be untrue."
Australian courts have expanded this phrase to establish possible and permissible states of belief or non-belief, falling short of the positive ‘honest belief’ required in Horrocks v Lowe. A recent example of this is the findings in Pervan v North Queensland Paper Co Ltd. [1991] Aust. Torts Reports 69, 103 where it speaks of various levels and types of belief being possible.
That view has lead to what defence counsel referred to as "the extended meaning" of fair comment. Namely that from a state of non-registered belief in the truth or otherwise of the defamatory facts, a defendant may proceed to make ‘fair’ comments on those ‘facts’.
The divergence, it seems to me, is largely caused by the manner of drafting of the section. Restating the double negative in positive terms is only to say that the person making the statement must believe in the truth of the matters published. For these reasons and because of the clear statement of Horrocks v Lowe that an honest belief, is required for good faith, I consider Papua New Guinea should not be persuaded to follow the Australian path. I am satisfied that Parliament did not intend in this Act to provide two in forms of good faith or two forms of fair comment, only one of which is made on facts truly stated. I am equally satisfied that the shades of belief necessary for good faith that evidence in any particular action may show be reconciled within the demand for positive honest belief.
By Section 19 of the Defamation Act, it is the task of the plaintiffs to prove absence of good faith. Overall the plaintiffs contend that the evidence plainly shows that all the defences advanced, whatever their merits as to privilege or otherwise, must fail because publication was not made in good faith. This was evidenced by the extravagant and violent language used by the first defendant, his lack of belief in the assertions made by him and his open admission in cross-examination that the purpose of the publication was to harm the plaintiffs.
For the defence, it was submitted (in regard to s 8) that the fact, it may be arguable, that an advertisement was such a departure as might disentitle a publisher to rely on the defence of a fair report of Parliamentary proceedings was not evidence of malice. Defence counsel said Sir Michael believed the matter to be true. He did not recklessly publish, not caring whether the words were true or false, because he had made extensive and appropriate enquiries of those who ought to have known who claimed to have known and whom he believed to know the facts. Legal advice had been taken. The fact that the first defendant established the Pelair Inquiry is indicative of his good faith.
The evidence relevant to this issue, not already recorded here is as follows:
You believed they had made, "repeated" attempts to cheat the Government".
Isn’t it true you believed the company had been appointed?
I didn’t realise. When you’re a minister you make the statement given to you.
That meant they were never agents of government for sale of Kumul.
[Q. put several time witness answers same way.]
In re-examination the first defendants reaffirmed his belief in the material provided by his staff and that it had been the subject of legal advice. He did not assert that he had in fact given instructions to institute proceedings.
I am satisfied that, on the evidence in this trial, the plaintiffs have clearly demonstrated that publication was made without good faith. The publication in my view fails to meet any of the criteria set out in ss 11 and 8(3) whereby good faith may be measured.
The first defendant in replying to a challenge by the Leader of the Opposition that PNG Aviation Services was duly appointed agent for the sale of Kumul 1, categorically denied that this was so claiming that the actual documents on which any claim is based clearly demonstrate otherwise. But, in making this assertion, he gratuitously, in my view, proceeds to castigate the plaintiffs as a disreputable foreign owned company engaging and manipulating politicians and a company whose principals are dishonest untrustworthy and who, with criminal intent, sought to defraud and cheat the PNG Government. Such aspersions regarding the plaintiffs are irrelevant to the issue of agency.
The evidence has shown that the claim that PNG Aviation Services was not the Government agent was not true. The evidence also shows that this fact was known to the first defendant at the time he made the statement. The documents claimed to support the assertions only confirm the fact of agency. The allegations regarding the plaintiffs are not founded in any matter put forward in the publication itself nor has any evidence been offered on which to ground them. They stand as baseless allegations made in extravagant terms.
While excessive language is not of itself conclusive of lack of good faith, such language charging unproven fraudulent and criminal acts does carry weight in a claim of lack of good faith. It is certainly evidence of an improper use of an occasion that might otherwise be protected. In Tei Abal v Anton Parau [1976] PNGLR 251, it was held by Frost CJ that on allegation of acceptance of a bribe by a political candidate, that "intrinsic evidence of lack of good faith because the allegation of corruption is so extreme and goes far beyond the just requirements even of political controversy".
I accept the submission of the plaintiffs counsel that the manner and extent of publication was excessive for the occasion under s 8 or s 11. Given that the statement had already been published in Parliament under full protection (which itself was publication to the whole of PNG), the republication in four newspapers over three days under the emblem of the State was not warranted. It must be seen as excessive.
The first defendant of course maintained throughout his evidence that the statement was not his own; that he merely read it out. But he acknowledged that he never checked the veracity of it. Despite error known to him, he never questioned his staff as to the correctness of the allegations of criminality against the plaintiffs.
He never queried his staff over the main thrust of the statement. That is, that the plaintiff company was never the agent of the Government when he knew that it was. He never checked through all the documents allegedly supporting the claim that no agency existed. He merely perused the statement shortly before delivering it in the House.
As stated in Horrocks v Lowe, what is required on the part of the defamer is positive belief in the truth of what he publishes. That is an honest belief.
The first defendant asserts that he believed the statement the time but that does not square with his answers in cross-examination. Explanation that he merely read the speech prepared by others and that he had no belief in whether the allegation were true or not are not evidence of positive honest belief, nor are the statements excused on grounds that he had no option but to stand by what statement was prepared for him; or that "when you’re a minister you make the statement given to you".
Inside the House, a member has absolute privilege. Outside, he has the privileges and liabilities of every other citizen. For good faith it is not enough to say I believed what someone else told me to say, particularly where obvious error in the assertions he was to convey, was patent.
The first defendant was challenged on ‘wilful blindness’ only to repeat his reliance on the statement prepared for him. I am satisfied the plaintiffs have shown that first defendant did not have an honest belief in the defamatory matter. In terms of s 11, he believed it untrue.
The defence submitted that the plaintiffs had failed to establish an absence of good faith on the part of the defendants. In fact, the first defendant had throughout the proceedings disavowed any malice or ill will towards any of the plaintiffs; that he didn’t intend to harm or discredit the plaintiffs. The intention is in fact irrelevant. It is the ordinary meaning of words that count. The ordinary meaning and fact of assertions of cheating and criminal actions without basis belies the first defendant’s claim that he bore no good will. The first defendant acknowledged he was angry with the plaintiffs and intended to harm them as Mr Wingti had with their assistance harmed him. It was said in Royal Aquarium v Parkinson [1892] UKLawRpKQB 46; (1892) 1 QB 431 that where a person through anger, makes aspersions of another people reckless whether they are true or false publication will not be excused.
I am satisfied too that in acknowledging that, one of the main reasons for his ordering the plaintiff Valentine deported was because of his filing proceedings for defamation against him. This is further evidence of lack of good faith on the part of the first defendant.
In the result, the plaintiff’s case has been overwhelming. As for the second defendant, it must be held vicariously responsible for the actions of its Chief Minister. Judgment is entered for each of the plaintiffs against each of the defendants.
Damages
Publication of defamatory matter is unlawful by virtue of Section 5 of the Defamation Act. In fact, by Section 18 a person is guilty of an offence and may be fined up to K600. If the person defamed is a Member of Parliament, the fine may extend to K1000.
No proof of actual injury is necessary in an action of defamation. The extent of injury to reputation is next to impossible to assertion; to obtain an exact measure of adequate compensation is equally difficult. Damages are, therefore, said to be at large. A fair and appropriate award must be based on all the circumstances. In assessing a proper award, decided cases show that the courts should include in its consideration, the plaintiff, the injury to his reputation, the plaintiff’s own conduct, the nature of the defamatory allegations made, and extent of publication, the absence of retraction or apology by the defendant and, in fact, the whole of the conduct of the defendant from the time the libel was published down to verdict. (See Gatley para. 1451).
The defamatory allegations in this case are, in my view, among the most serious and damaging that can be made. A company’s reputation is dependent on its being recognised as honest and fair in its dealings. Allegations that it is disreputable, dishonest, and cheats in business are to attack a business at its heart.
To assert that its principals, naming them individually, are also dishonest, fraudulent, criminal and cheats who consciously set about to cheat the PNG Government is to make the most serious and damaging of charges.
The charges were unwarranted not only because they were not true but also because they were known not to be true. The facts supposedly giving rise to the charges were known not to be true and documentation offered supposedly as proof of the charges clearly and obviously did not do so.
When the man in the street unjustly defames his neighbour, the injury is a serious matter having its own consequences. It will result in an appropriate award in damages. However, when the State, through its Prime Minister, asserts untruthfully that a company is dishonest and names its principals as criminals in statements published bearing the State emblem, on three consecutive days throughout the nation, the impact of such charges on the reputation of the company and individuals can only be regarded as devastating. Such assertions are in effect a pronouncement of the State; a conviction without the process of law for which the State is guarantor.
I am satisfied that was the case here. The evidence shows that the company was stopped in its tracks and eventually went out of business. The two working principals, Messrs Mendoza and Valentine, were left without position or income, their business failed and their reputations wrecked. Mr Lussick, as an advisory director of the company, was perhaps not affected so much as to his income but his reputation was, like the others, seriously injured.
The Pelair Enquiry instigated by the first defendant did in fact help to vindicate the plaintiffs though that vindication did not generate any change of heart in the defendants by way of apology or recompense. In the normal course of an action for defamation, failure, even refusal, to retract or apologise for defamatory matter prior to verdict matter may not warrant adverse comment. But where, as here, prior even to proceedings being commenced, there has been a public enquiry where the findings, which the defendants freely accept, cleared the plaintiffs of any wrong doing then, in such case, the failure to retract or apologise must be seen as serious lack of good faith.
Evidence was given as to the effect of the publication on the Company and the financial losses that it was said to have sustained. Evidence was given also by each of the plaintiffs directors as to the impact of the publication on them financially, and the resultant isolation socially and in the business community.
For PNG Aviation Services, counsel submitted that an award should compensate the company for its loss of goodwill, the financial losses sustained and for the company’s eventual closure. Defence counsel pointed out that the company was in fact unprofitable. It had sustained losses in the previous two years and was carrying heavy debt.
I do not propose to traverse the evidence regarding the company finances. Suffice to say that I accept the defence contention that the company was, at the time of the publication certainly not making much more than wages for its staff. It was financially not strong. But notwithstanding the extensive obligation it was carrying, insolvency was far from inevitable. It was nonetheless a viable operation being run in its development stages with the vigour and determination of its shareholders with the guidance of Mr Lussick, an experienced businessman of long standing. I am satisfied that it had every chance of developing into a strong profitable business had this attack not occurred.
I am satisfied on the evidence that both Mr Mandoza and Mr Valentine had a wide acquaintance throughout the community and were well known in the aviation industry particularly. I am satisfied that their reputations did suffer from the publication. When persons are defamed, injury to reputation is not necessarily shown by the public or friends directly abusing or shunning the victim. It is perhaps more often shown by friends and business associates avoiding the usual relationship and suddenly distancing themselves and avoiding contact. The earlier ease of association is lost. I accept the plaintiff’s evidence that such was the experience.
Defence counsel suggested that Mr Mendoza has a robust personality not readily put down. It was suggested too that he had in fact suffered no financial loss. If anything, he was relieved of a marginal business and subsequently able to undertake a position paying him more.
On a purely monetary and momentary basis, this submission has some accuracy. But restricting one’s own drawings during the early stages of a business is accepted as usual and sound business practice to help meet the demands of a business. But this submission fails to take into account the injury sustained in the loss of independence and satisfaction in conducting one’s own business. As for Mr Mendoza’s resilience, it is fortunate that he has had that strong character trait to sustain him throughout this matter. It is not a matter of mitigation for the defence.
Evidence was adduced as to the effect the publication had on Mr Valentine’s health. I am satisfied that it did so, but the evidence also shows that he was already in ill health at the time of publication. That I believe aggravated his condition but on the evidence I am unable to conclude to what extent. Nonetheless, the fact of an actual impact on his health is a matter to be included in the assessment of compensation. As for the third director, Mr Lussick, the defence pointed out that he had no financial interest in PNG Aviation Services, and that he had not let the publication interfere with his business or social way of life. The effect of publication must have been minimal since he has had significant honours conferred on him since. His reputation is effectively impregnable and remains unimpaired. Accordingly, damages if any should be nominal only.
I accept these statements as to Mr Lussick. They confirm the evidence he gave himself with the dignity and assurance of a man confident in himself and his achievements. But contrary to the submission that they are reasons for nominal damages, they are reason for substantial damages illustrating as they do that this was totally unwarranted attack on a prominent man of the community with a honourable reputation built on achievement and integrity.
There was a suggestion that the plaintiffs were somehow guilty of delay in bringing these proceedings. That is not so. Following publication, there was the Pelair Enquiry and from that reasonable hopes of recompense. When nothing eventuated, these proceedings were commenced. I do not see that they can be accused of an unreasonable delay.
Turning to the awards themselves, it was submitted by the defence that nothing is to be gained by attempts to compare awards with those made in other jurisdictions. Further, it was suggested that, given the few decisions on defamation, it would be legitimate and appropriate that a comparison with personal injury awards be made citing Carson v John Fairfax & Sons Ltd [1993] ALJR 634. Pursuant to that submission, he cited several cases brought under the Motor Vehicles Insurance Trust legislation.
While not discounting that it may often be valid to draw comparisons with personal injury cases, I find those cited to be unhelpful. The awards in Tei Abal's case, Baker v Lae Printing Pty Ltd [1979] PNGLR 16 and Cross v Zuideina [1987] PNGLR 361 were likewise of little value for this decision.
In my assessment, this damaging attack on the plaintiffs is one where the award in compensation should not only be appropriate to the injury sustained but also signify and affirm the vindication of the plaintiffs’ reputations.
Accordingly, bearing in mind that Messrs Mendoza and Valentine are also the shareholders in PNG Aviation Services, I award damages to that Company of K50,000.00. Mr Mendoza and Mr Valentine and Mr Lussick, I consider should be equally compensated, and award to each the sum of K100,000.00. Interest, from commencement of proceedings until verdict to be at 8%.
There was a claim by the plaintiffs for aggravated damages. I have found in this case that all the matters raised in support of such a claim are essentially the same as arise in the ordinary course of the compensation award now made.
There does, however, remain the issue of costs. In this case, costs of course will follow the event. However, given the circumstances of this case, I consider it appropriate that those costs are on a solicitor client basis and I so order.
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