Channel 7 vs Amber Harrison: when PR should sometimes trump the law

The latest Court offering served up by the long running and very public legal dispute between Amber Harrison and Channel 7 serves as a timely reminder that sometimes technically correct (and indeed in this case successful) legal actions should still not be pursued for the sake of a company's reputation and wider commercial interests. 

As you may recall, Ms Harrison had a very public liaison dangereuse with one of her former colleagues, the CEO of Channel 7 Tim Worner.  That affair became the subject of a settlement agreement between Harrison and Ch7 which Harrison alleged was breached by Ch7 (including the failure to pay agreed sums of money) and that Ch7 alleged Harrison breached by failing to comply with confidentiality provisions.  Ch7 then obtained a very widespread 'gagging order' from the Court preventing Harrison from saying anything publicly about Ch7.

Ch7 Executives, no doubt relying on the extensive gagging order, then came out swinging, in public, against Harrison.  The plan back-fired.  Harrison refused to be gagged whilst being publicly attacked, and responded in kind.

Fast forward to this week, and we have the Supreme Court finding that whilst Harrison clearly breached the Court gagging order and needs to be found guilty of contempt, there appears to be no other penalty or punishment imposed and no costs ordered in favour of the Ch7 shareholders.  Even more damaging for Ch7, the judgment also overtly displays substantial sympathy for Harrison's position, and Justice Pembroke repeatedly stresses that the Court was required to find her guilty of contempt, whilst setting out at length in the Judgement all of the circumstances that led Harrison to respond in the manner that she did.  Reading between the lines, it was a bad strategic call by Ch7. 

And that is perhaps the take away: whilst technically Harrison was gagged and unable to respond to the public attacks levelled at her by the Ch7 Executives, such events are, at least initially, played out in the public domain well before they darken the door of any Courtroom.  The general public will not accept or fully understand the legal intricacies involved in a gagging orders or contempt proceedings and are merely going to see a lone female employee going toe to toe with a large and very well resourced company.  In a media/PR sense, it is never going to be a fair fight and Ch7 needed to recognise that, regardless of the weight of its legal argument.  The decision to then bring contempt proceedings was highly unlikely to bring any commercial or PR benefit to Ch7, but they still pressed the button.  Its a great example of where a legal argument or position needs to be strategically viewed in the wider commercial context - otherwise you may just be headed for a very expensive (if not damaging) pyrrhic victory.

   

What to do if you have been served a Director Penalty Notice by the ATO?

If you are a Director of a company and your PAYG and Superannuation Guarantee Charge Obligations are not up to date, you could find yourself the subject of an ATO Director Penalty Notice (DPN) and incur personally liability for those outstanding debts.   

The ATO issues DPNs as part of its debt recovery actions and once issued you have 21 days to either: 

  1. cause the Company to pay the debt (or pay it yourself); or
  2. appoint a voluntary administrator; or 
  3. put the Company into liquidation. 

A failure to comply within 21 days will automatically make you personally liable for the unpaid super/PAYG, subject to the limited defences discussed below. 

You should also be aware that if the company’s BAS returns are more than 3 months old, the serving of the DPN can give rise to personal liability for the directors for Company tax debts EVEN IF they then put the company into liquidation or voluntary administration within the 21 day period. 

Where no returns have been lodged, the ATO can undertake an audit and simply issue an estimate of the debt and then issue a DPN based on that estimate, so a failure to report does not necessarily provide any protection to personal liability. 

Under the legislation a director cannot avoid liability under a DPN by claiming they did not receive it – the ATO merely needs to prove that it was properly posted by normal post to evidence receipt. 

There are some limited defences to liability arising under a DPN.  A Director is not personally liable if they can prove: 

  1. they were not capable of acting as a Director of the company during the relevant period that the debts arose and were not paid due to sickness or some other good reason; 
  2. they took all reasonable steps to ensure that: 
    • the directors caused the company to comply with its obligations; 
    • the directors caused an administrator of the company to be appointed; 
    • the directors caused the company to begin to be wound up, and
    • there were no reasonable steps that could have been taken to ensure that any of the above happened. 

Whether a course of action is 'reasonable' and whether there is sufficient evidence to support the argument will vary on a case-by-case basis and requires advice. 

Cove Legal are experts in assisting our clients with contentious tax matters and insolvency proceedings and provide advice on ATO payment plans and all other aspects of ATO debt recovery action.  Roger Blow acted extensively for the ATO in Perth for over 5 years and has specific expertise in tax related disputes.   

If you would like advice or assistance with any legal matters involving the ATO, we would be keen to hear from you.   Please contact: 

Roger Blow, Principal, Ph: +61 8 6381 0327 or roger@covelegal.com.au

This publication is not intended to provide and does not provide legal advice. You should seek professional legal advice relating to your specific situation(s) before taking any action based upon its contents. 

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CoveFefe takes to the stage at The Charles Hotel, Saturday 10 February

Cove Legal is once again entering a band into this year’s Corporate Battle of the Bands competition at The Charles Hotel on Saturday 10 February.

Cove’s Principal Roger Blow is the founder and co-organiser of the competition, which has been raising funds for charitable causes since 2008 and is this year expected to raise over $15,000 for the vital work of Youth Focus and Cystic Fibrosis WA.

Youth Focus is a charity that seeks to combat suicide and depression amongst the youth of Western Australia and is a cause close to the heart of the firm and its staff.  More information on that charity can be found at www.youthfocus.com.au

These nights have a reputation for being great fun for both the bands and their supporters and we would love to see clients, colleagues and contacts there to support CoveFefe on the big night.  Your ticket entry price of just $30 all goes to charity AND gets you whole night of live music, a live DJ between performances and The Charles’ very reasonably priced bar selection.  Expect energetic performances, enthusiastic cheer squads and some questionable stage outfits!

This year’s entrants include bands from Channel 9, St John Ambulance and Arup and the proceedings will be MC’d by 6PR’s own James Lush.  A stunning fully tailored suit kindly donated by LGFG Fashion House worth over $2000 will also be auctioned off on the night.

For more info on the event check out the Facebook page at: https://www.facebook.com/corporatebotb/

To buy tickets (bring friends!) click here: https://www.rideforyouth.com.au/2018/event/corporate-battle-of-the-bands/

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Defamation is not just for the rich and famous

Recent press coverage has highlighted that legal actions arising from activity on social media are on the increase and are no longer limited to claims by the rich and famous.

For example in Port Stephens, the local Mayor is suing two people for defamation after they alleged in a Facebook post that he touched two women on the buttocks at a function.  Both the person that posted the original allegation and also a second person who re-posted the allegations are being sued.

This follows on from a recent decision in a Swiss court that found a person who ‘liked’ a defamatory post on Facebook was guilty of defamation. The court said that by clicking the like button, the “defendant clearly endorsed the unseemly content and made it his own.”

Closer to home, NSW Judge Judith Gibson said that people posting and re-posting negative commentary on Facebook and in blogs are likely to be faced with expensive legal action which could end up costing them between $100,000 to $1 million to defend.  

Judge Gibson said that “claims based on publications on the internet, emails and on social media, are now far more common than claims against traditional media defendants.”

Perhaps a useful ‘acid test’ when the fingers are hovering over the keyboard is to ask yourself ‘Would I feel comfortable shouting this allegation in front of the other school parents, or down at the local club?’  In a legal sense, it’s all the same risk.  If that advice is perhaps too late for you, feel free to contact us for assistance.

Cove Legal Principal Roger Blow is recognised as a media law expert, particularly in liability arising from the use of social media.  He has represented tier one national political figures in defamation disputes and obtained injunctions in the Supreme Court of Western Australia relating to derogatory Facebook publications.

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Defamation Basics Part III

Remedies: offers to make amends and litigation

In our third and final instalment of our defamation series, we now turn to the options available to an aggrieved person (or plaintiff) that has been defamed and what an author/publisher (or defendant) can do if they receive a concerns notice.

Concerns notice

An aggrieved person may issue a written notice to the author/publisher of defamatory material explaining the defamatory implications within the publication.  If the notice fails to adequately particularise the imputations of concern, the publisher may request further and better particulars about them from the aggrieved person.

Offer to make amends

The publisher may make an offer to make amends within 28 days from receipt of the concerns notice.  The offer must be in writing and must:

  • state what defamatory imputations the offer relates to;
  • include an offer to publish a reasonable correction of the material in question;
  • if the material has been given to someone else by the publisher, include an offer to take reasonable steps to tell the other person that the material is or may be defamatory of the aggrieved person; and
  • include an order to pay the expenses reasonably incurred by the aggrieved person before the offer was made and the expenses reasonably incurred in considering the offer.

If the publisher carries out the terms of an offer to make amends that is accepted, the aggrieved person cannot then continue or enforce an action for defamation against the publisher in relation to the material in question.

If an offer to make amends is made in relation to the material in question but is not accepted, it is a defence to an action for defamation against the publisher if:

  • the offer is made as soon as practicable after receiving the concerns notice;
  • the publisher was ready and willing, on acceptance of the offer, to carry out the terms of the offer; and
  • the offer was reasonable in the circumstances.

Apologies

An apology by a publisher to an aggrieved person cannot be submitted as evidence of admission of fault or liability, however can be a factor in mitigating damages.

Litigation – commencing an action and damages

Revisiting Part I – Bringing a defamation claim in Western Australia, a plaintiff can issue proceedings against a defendant within one year of publication of the defamatory material.  The plaintiff is required to prove that:

  • the material was published to a third person, other than the plaintiff;
  • the material was of and concerning the plaintiff; and
  • the material was defamatory of the plaintiff.

A successful plaintiff may be entitled to an award of damages for non-economic loss, which may be in the form of:

  • general compensatory damages – currently limited to a maximum of $389,500; and/or
  • aggravated damages - the amount of damages will depend on the circumstances of the case and can exceed the current statutory limit.

In awarding damages for defamation, the court is to disregard the malice or other state of mind of the defendant at the time the material was published.

Exemplary damages (that is, damages designed to punish the defendant rather than compensate the plaintiff) cannot be awarded in defamation actions under the legislation in Western Australia.

Damages can be mitigated by such actions as the defendant apologising or publishing a correction of the defamatory material.

Check out our blog for the other posts in this series: Part I – Bringing a defamation claim in Western Australia and Part II - Defences to a defamation claim.

Cove Legal offers specialist expertise in the area of media law, with a focus on protecting corporate brands and reputations.  Roger Blow is a leading defamation lawyer in Western Australia and can be found listed as a social media law expert on expertguide.com.  He regularly provides commentary concerning media law issues to television, radio stations and newspapers such as the West Australian, The Age and AFR.

If you would like advice or assistance with any legal matters involving defamation, we would be keen to hear from you.  Please contact:

Roger Blow, Principal, Ph: +61 8 6381 0327 or roger@covelegal.com.au

Tennille Provost, Senior Associate, Ph: +61 8 6381 0326 or tennille@covelegal.com.au

This publication is not legal advice. You should seek professional advice before taking any action based on its contents.

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