Defamation (Miscellaneous) Amendment Bill

Second Reading

The Hon. R.I. LUCAS (Treasurer) (15:51): I move:

That this bill be now read a second time.

I seek leave to have the second reading explanation and the detailed explanation of clauses inserted in Hansard without my reading them.

Leave granted.

I am pleased to introduce the Defamation (Miscellaneous) Amendment Bill 2020, which amends the Defamation Act 2005 and the Limitation of Actions Act 1936. The Bill has been developed thanks to significant work and cooperation between all Australian jurisdictions and represents the first substantial amendments to the Defamation Act since it was passed. This is a major milestone in Australian defamation law.

Mr President, the Defamation Act is the South Australian version of the National Model Defamation Provisions, which were adopted in each state and territory in 2005. The Model Defamation Provisions were the result of an immense national effort to create uniform defamation law across Australia.

The Model Defamation Provisions have now been in place for 15 years, however they have not been amended since that time. The case law and experience accumulated during that time has revealed which aspects of the legislation are working well, and which would benefit from being reconsidered, fixed or updated.

To that end, in June 2018 the Council of Attorneys-General agreed to convene a national Defamation Working Party to recommend changes to the model laws. After extensive consideration and two periods of national consultation, the Working Party presented recommended amendments to the Council of Attorneys-General in July 2020. The Council supported the recommended reform and now each state and territory government are taking steps to adopt the reform through their own respective Parliament's.

This Bill contains numerous amendments to the Defamation Act, ranging from small technical changes to significant and innovative reform.

The purpose of all these changes is to ensure that Australia's defamation law continues to meet its main objects as set out in the Defamation Act. These objects are:

(a) to enact provisions to promote uniform laws of defamation in Australia;

(b) to ensure that the law of defamation does not place unreasonable limits on freedom of expression and, in particular, on the publication and discussion of matters of public interest and importance;

(c) to provide effective and fair remedies for persons whose reputations are harmed by the publication of defamatory matter; and

(d) to promote speedy and non-litigious methods of resolving disputes about the publication of defamatory matter.

The national consultation process which was undertaken on defamation reform, found that these objectives are still considered valid and are widely supported, but that some aspects of the law have been failing to achieve them.

The Defamation (Miscellaneous) Amendment Bill 2020 forges a decisive path forward to ensure that defamation law continues to serve the needs of contemporary society.

The Defamation Act already places a strong emphasis on non-litigious methods of resolving defamation disputes. The Act currently has an option for a person who thinks they have been defamed to send a 'concerns notice' to the publisher of the material, setting out their complaint about the alleged defamation.

During the national consultation on defamation reform, many stakeholders supported making this step a mandatory requirement before court action can be commenced.

Clause 9 of the Bill requires a potential plaintiff to send a concerns notice and then serve a waiting period before beginning court action. The waiting period is equivalent to the time the publisher has to make a statutory 'offer to make amends'. By mandating this pre-action step, it is hoped that parties will engage more seriously in pre-action negotiations. Importantly, the Bill contains protections to ensure a plaintiff does not fall foul of the limitation period while completing these steps, and the waiting period can be waived at the discretion of the Court if it is just and reasonable to do so.

Free speech and public interest communication will be better protected through two new defences proposed in this Bill. The first, in clause 15, provides a defence for publications on matters of public interest. When the model defamation provisions were adopted, the defence of qualified privilege was expected to cover public interest journalism. However, since then, experience has shown that it is difficult to apply and is rarely successful in defending public interest publications. To remedy this, the Bill introduces a standalone defence for matters in the public interest, which has been modelled on defences already available in the United Kingdom and New Zealand.

Whilst this defence will of course be useful to the commercial media, it can be used by any person communicating on public interest matters, so long as they can prove they had a reasonable belief that the publication was in the public interest in the circumstances.

The second new defence, in clause 17, provides protection for academic and scientific publications in peer-reviewed journals, ensuring robust discussion can occur on academic and scientific matters.

One of the most significant reforms proposed by this Bill is contained in clause 7, which introduces a serious harm threshold for defamation actions. This new test provides that a publication will not be considered defamatory unless it has caused, or is likely to cause, serious harm to the reputation of the plaintiff.

Defamation law was never meant to be a forum for resolving interpersonal disputes; but rather is designed to ensure a person's public reputation can be protected.

However, in today's social media age, interpersonal disputes are often played out online, in full view of Facebook friends or twitter followers. Whilst the common perception of a defamation action is a celebrity or politician suing a media company, a recent study by the University of Sydney's Centre for Media Transition found that only 1 in 5 defamation plaintiffs were public figures and only 1 in 4 defendants ran a media business.

Under the current law, minor instances of defamation can still attract an award of damages. The defendant may attempt to rely on the defence of triviality, however this requires proof that, in the circumstances of the publication, the plaintiff was unlikely to sustain any harm. It is not enough to establish that the publication caused only slight or insubstantial harm.

A minor defamation case may work its way through the court and can result in an award of a small amount of monetary damages, but the cost to the court system of running that case will far outstrip the damages awarded.

This does not immediately mean it is not worth the court's time; many legal actions result in small awards but are of course, worthwhile.

However, it does warrant an examination of whether court action is the best way to deal with such disputes, and in this case we have concluded that it is not.

In response, the Bill proposes to lift the threshold on what is considered an actionable defamation case. The plaintiff must demonstrate that the harm or potential harm to their personal reputation is serious.

The Bill contains mechanisms whereby parties can apply for the determination of the serious harm element before the trial begins, allowing early dismissal of minor cases, if appropriate.

'Serious harm' is to be assessed in the circumstances of the particular case and, for natural persons, it does not have to involve financial loss. It is intended that this threshold will filter out minor cases that are more in the nature of interpersonal rather than legal disputes. This might include accusations that were not widely published or were mild in nature. This test has been modelled on a similar provision in the United Kingdom.

The defence of triviality will be abolished by clause 19 of the Bill, as it will be superseded by the new serious harm test.

Another way the Bill addresses advances in technology is through the introduction of a single publication rule by Part 2 of the Schedule. The Limitation of Actions Act 1936 provides a one-year limitation period for defamation actions, which may be extended to up to three years by court order. However, the effect of relevant case law is that each time an internet publication is downloaded, a new limitation period begins, thereby allowing a plaintiff to sue the publication for as long as it remains available online. For example, an internet article that has been online since 2015 can still be the subject of a legal action in 2020 provided it was downloaded just once in the previous year.

The proposed single publication rule provides that the limitation period begins the first time a publication is made publicly available and is unaffected by subsequent publications of substantially the same content.

The Bill provides some additional safeguards to prevent unintended harsh effects of this rule.

First, the limitation period may start again if the manner of a subsequent publication is materially different from the manner of the first publication. Second, the test for extending the limitation period has been softened slightly to allow the courts to take into account a wider range of circumstances. However, the upper limit remains three years from the date of first publication.

The Bill will also reform how monetary damages are awarded in defamation cases. The Defamation Act currently caps the amount of damages that a court may award for non-economic loss, which compensates for loss of reputation and hurt feelings.

The cap is adjusted annually, and currently sits at $421,000. The cap is intended to ensure that a defamation plaintiff receives appropriate and proportional damages in relation to their non-economic loss. Compensation for actual loss of earnings is awarded separately and is not capped.

The cap is still considered an important aspect of the law and the Bill makes changes to ensure that it operates as intended and that it cannot be circumvented by legal loopholes.

Clause 20 of the Bill provides that the cap should be interpreted as a 'range' of damages for non-economic loss, in which the top of the cap represents the appropriate award for the most serious types of defamation. The Victorian Court of Appeal has previously held that the cap is a simple cut-off that bears no relationship to the seriousness of the case; the Council of Attorneys-General wants to address this ruling.

Under the law proposed by the Bill, the cap may not be exceeded under any circumstances, however if the defendant's conduct was particularly harmful then a separate award of aggravated damages may still be awarded. However, the two parts of the award need to be separate and transparent.

Clause 13 of the Bill will also prevent plaintiffs circumventing the cap on damages. Currently the cap applies to each legal action, and so if the plaintiff brings more than one action in relation to the same matter, they may be able to circumvent the cap.

At the moment, there is no rule against suing related parties separately in relation to the same publication. For example, a plaintiff could sue the author of a newspaper article in one action, and the owner of the newspaper in another, doubling up on court time and avoiding the full application of the cap. To address this, the Bill amends the rules on multiple proceedings to require the leave of the court to bring further proceedings in relation to the publication of the same or like matter by the same or associated defendants.

Some of the more minor amendments in the Bill include:

Clause 5, which broadens how employees are counted when determining if a corporation is small enough to be eligible to sue in defamation;

Clause 6, which will allow the Court to decide questions of costs if a defamation action ends due to the death of a party;

Clauses 10 to 12, which clarify the requirements for making a valid offer to make amends;

Clause 14, which simplifies the contextual truth defence;

Clause 18, which sets out how the basis for an opinion must be presented to make out the honest opinion defence.

I commend the Bill to Members.

Explanation of Clauses

Part 1—Preliminary

1—Short title

2—Commencement

3—Amendment provisions

These clauses are formal.

Part 2—Amendment of Defamation Act 2005

4—Amendment of section 4—Interpretation

This clause inserts definitions for the purposes of the measure.

5—Amendment of section 9—Certain corporations do not have cause of action for defamation

Currently, section 9 does not define the term employee, so the term would have its ordinary meaning. The ordinary meaning of the term does not include persons who provide services other than under a contract of service. For example, it does not include independent contractors and other non-employees even though they may have major roles in the operations of the corporation. This clause inserts a broad definition of employee.

This clause also replaces references to related corporations with references to associated entities (within the meaning of section 50AAA of the Corporations Act 2001 of the Commonwealth).

6—Amendment of section 10—No cause of action for defamation of, or against, deceased persons

This clause provides that section 10 does not prevent a court, if it considers it in the interests of justice to do so, from determining the question of costs for proceedings discontinued because of the section.

7—Insertion of section 10A

This clause inserts new section 10A which provides for it to be an element of the cause of action for defamation for the plaintiff to prove the publication of the defamatory matter has caused, or is likely to cause, serious harm to the reputation of the plaintiff. Also, excluded corporations suing for defamation must prove serious financial loss. In addition, a procedure is set out for determining whether the element is established.

8—Amendment of heading to Part 3 Division 1

This clause amends the heading to Part 3 Division 1 consequential on the amendments in clause 9.

9—Insertion of sections 12A and 12B

This clause inserts new sections 12A and 12B dealing with the requirements for concerns notices in defamation proceedings. Proposed section 12A provides for the form and content of concerns notices. Proposed section 12B provides (with exception by permission of the court) that an aggrieved person cannot commence defamation proceedings unless the person has given the proposed defendant a concerns notice in respect of the matter concerned, the imputations to be relied on by the person in the proposed proceedings were particularised in the concerns notice and the applicable period for an offer to make amends has elapsed.

10—Amendment of section 14—When offer to make amends may be made

This clause amends section 14 to provide for an extended period beyond 28 days of a concerns notice being given if further particulars for the concerns notice have been requested.

11—Amendment of section 15—Content of offer to make amends

This clause amends section 15 to:

(a) require an offer to make amends to be open for at least 28 days commencing on the day the offer is made; and

(b) enable an offer to make amends to include an offer to publish, or join in publishing, a clarification of, or additional information about, the matter in question as an alternative to a reasonable correction; and

(c) relocates provisions concerning offers to redress the harm sustained by the aggrieved person to make it clear that the inclusion of these matters is not mandatory.

12—Amendment of section 18—Effect of failure to accept reasonable offer to make amends

This clause amends section 18 to:

(a) alter the first precondition so that the offer must be made as soon as reasonably practicable after the publisher was given a concerns notice in respect of the matter (and, in any event, within the applicable period for an offer to make amends); and

(b) alter the second precondition so that the defence can be relied on if the publisher remains ready and willing to carry out the terms of the offer during the trial.

13—Substitution of section 21

This clause proposes to substitute section 21 to recast the section so that it also requires the permission of the court to bring defamation proceedings against associates of the previous defendant. These are persons who, at the time of the publication by the previous defendant, were—

(a) employees of the defendant, or

(b) persons publishing matter as contractors of the defendant, or

(c) associated entities of the defendant (or employees or contractors of these associated entities).

14—Substitution of section 24

This clause proposes to substitute section 24 to reformulate the defence of contextual truth to make it clear that, in order to establish the defence, a defendant may plead back substantially true imputations originally pleaded by the plaintiff.

15—Insertion of section 27A

This clause inserts new section 27A to provide a defence if the defendant proves that—

(a) the matter concerns an issue of public interest; and

(b) the defendant reasonably believed that the publication of the matter was in the public interest.

16—Amendment of section 28—Defence of qualified privilege for provision of certain information

This clause amends section 28 to recast the factors that may be taken into account in determining whether the defence is established so as to minimise duplication with the factors for the new public interest defence. As with the new public interest defence, the purpose of these factors is to provide some non-exhaustive guidance to the court. Not all, or any, of these factors must be satisfied.

17—Insertion of section 28A

This clause inserts new section 28A to provide a defence of scientific or academic peer review if the defendant proves that—

(a) the matter was published in a scientific or academic journal (whether published in electronic form or otherwise); and

(b) the matter relates to a scientific or academic issue; and

(c) an independent review of the matter's scientific or academic merit was carried out before the matter was published in the journal by—

(i) the editor of the journal if the editor has expertise in the scientific or academic issue concerned; or

(ii) one or more persons with expertise in the scientific or academic issue concerned.

18—Amendment of section 29—Defences of honest opinion

This clause amends section 29 to clarify the circumstances in which an opinion is based on proper material (see section 29(1)(c)).

19—Repeal of section 31

This clause repeals section 31 (defence of triviality) consequential on the inclusion of new section 10A. It is proposed that the onus will now be on the plaintiff to prove serious harm in order to bring a successful action for defamation. Accordingly, there is no need for the defendant to prove the harm was trivial.

20—Amendment of section 33—Damages for non-economic loss limited

This clause amends section 33 to—

(a) confirm that the maximum amount sets a scale or range rather than a cap, with the maximum amount to be awarded only in a most serious case, and

(b) require awards of aggravated damages to be made separately to awards of damages for non-economic loss so that the scale or range for damages for non-economic loss continues to apply for non-economic loss even if aggravated damages are awarded.

21—Amendment of section 41—Giving of notices and other documents

This clause amends section 41 to allow notices and other documents to be sent to an email address specified by the recipient for the giving or service of documents.

Schedule 1—Related amendments and transitional provisions

Part 1—Preliminary

1—Amendment provisions

This clause is formal.

Part 2—Amendment of Limitation of Actions Act 1936

2—Amendment of section 37—Defamation proceedings generally to be commenced within 1 year

This clause amends section 37 of the Limitation of Actions Act 1936 to make provision for the extension of the limitation period consequential on the amendments made to the Defamation Act 2005 in respect of concerns notices.

3—Insertion of sections 37A, 37B and 37C

This clause inserts 3 new provisions into the Limitation of Actions Act 1936—

(a) section 37A—to provide for a single accrual date of the limitation period where more than 1 publication contain substantially the same imputations giving rise to a cause of action for defamation; and

(b) section 37B—to permit the court to extend the limitation period to a period of up to 3 years running from the date of the alleged publication of the matter if the plaintiff satisfies the court that it is just and reasonable to allow an action to proceed; and

(c) section 37C—to provide that, for the purposes of determining the limitation period, the date of publication of a matter in electronic form is to be determined by reference to the day on which the matter was first uploaded for access or sent electronically to a recipient.

Part 3—Transitional provisions

4—Transitional provisions—Defamation Act 2005

This clause provides that an amendment made to the Defamation Act 2005 by this measure applies only in relation to the publication of defamatory matter after the commencement of the measure.

5—Transitional provisions—Limitation of Actions Act 1936

This clause provides transitional provision in respect of the amendments made to the Limitation of Actions Act 1936 by the measure.

Debate adjourned on motion of Hon. I.K. Hunter.