The New South Wales Court of Appeal in Prince v Malouf [2014] NSWCA 12 has recently overturned a District Court award of damages

The two parties, Dr Prince and Dr Malouf, were ear, nose and throat surgeons who, in early 2006, both performed procedures at Grafton Base Hospital. Dr Prince had operated from the hospital for a number of years while Dr Malouf had operated there on a locum basis for some time. In March 2006, Dr Prince, the incumbent surgeon, sent a series of letters to the hospital’s administrators and patients on the hospital’s waiting list. Among other things, these letters expressed concerns as to the post-operative care of patients on whom Dr Malouf was going to conduct surgery. Copies of some of the letters were also sent to the hospital’s insurance fund and professional indemnity insurer as well as the Australian Medical Association.

Dr Malouf brought proceedings in the District Court against Dr Prince for damages arising from the harm caused to his reputation in the various letters. The trial judge found in Dr Malouf’s favour only with respect to the letter to the patients on the waiting list. In relation to the letters to the hospital’s administrators, it was held that the imputations conveyed in the letters were defamatory, however, Dr Malouf failed in his claim as the defence of common law qualified privilege was found. Furthermore, this defence was not harmed by the existence of malice in Dr Prince’s actions. 

Dr Prince’s reliance on the defence of honest opinion was rejected leading to the trial judge awarding $138,500 in relation to the letter to the patients. Dr Prince appealed this award on the grounds of statutory qualified privilege, that the publication of the letter to the patients was reasonable in the circumstances, that Dr Prince was not motivated by malice and that the trial judge incorrectly rejected the defence of honest opinion.

The New South Wales Court of Appeal held:

  • the trial judge had correctly found the letter to the patients conveyed two of the three alleged defamatory imputations (i.e. that Dr Malouf does not provide adequate post-operative care for his patients and that Dr Malouf presented a danger to patients).
  • however, the publication of the letters to the hospital’s administrators and the letter to the patients as well as the publication of the letters to the hospital’s administrators to the hospital’s insurance provider occurred under the defence of common law qualified privilege as it was proven that both the sender and receiver of the information had a special and reciprocal interest in its subject matter (i.e. a concern for health and safety).
  • the publication of copies of the letters to Dr Malouf’s professional indemnity insurer and the AMA were not held to have occurred under common law qualified privilege. The Court of Appeal awarded Dr Malouf $20,000 in damages for the publication of those letters.
  • as common law qualified privilege was correctly applied, it was not necessary to consider statutory qualified privilege or honest opinion.
  • the trial judge was correct in concluding that Dr Prince was not motivated by malice in publishing any of the letters.

Dr Prince’s successful appeal on the grounds of qualified privilege saw the Court of Appeal order Dr Malouf to pay back $118,500 of the original District Court judgment, with the remaining $20,000 to cover the damages caused by the publication of the copies of the letters to Dr Malouf’s professional indemnity insurer and the AMA. Dr Malouf was also ordered to pay 75% of Dr Prince’s costs of his successful appeal.

This case is an interesting example of the notion of publication in the public interest provided under the defence of common law qualified privilege.