ORIENTAL PRESS GROUP LTD. v. NEXT MAGAZINE PUBLISHING LTD. AND OTHERS

HCA3831/1997

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO.3831 OF 1997

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DETERMINATION ON PRELIMINARY ISSUE

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1. This is a libel action. The article in question was published on the 31 May 1996 issue of the Chinese weekly magazine, "Next Magazine".

2. At the commencement of the trial, the defendants applied for the determination by way of preliminary issue as to whether the words complained of are capable of bearing the defamatory means as pleaded in the Statement of Claim.

3. The article in question is a short one. The original Chinese text reads :

"中方欲買《天天》

要員奔東方

報紙界又醞釀大變動，中資出版王國--聯合出版集團有意買起《天天日報》，出價億幾，中方搶佔傳媒陣地，已如箭在弦，擺明要在九七年加強手中之宣傳武器。

原擁有《天天》之文化傳信集團，高層亦有大變，行政壹哥關越強及左右手陳啟祥將於六月中過檔東方，幫馬主席打理集團業務。江湖消息話馬主席斟過鄭經翰做此位，但傾唔成，其後再斟關越強，他在一年前已有離心，故一拍即合，並曾往台灣面見老馬(馬主席之父)，獲委以重任。"

4. The certified English translation is as follows :

"Chinese Party Intends to Purchase Tin Tin

Oriental's Key Personnel Fled

The newspaper industry is again getting ready for another big shake-up. The United Publisher Group, publishing empire funded by Chinese capital, proposes to pay a price of more than 100 million dollars to buy out 'Tin Tin Daily News'. Like an arrow on a fully drawn bow, the Chinese has been more than ready to snatch up grounds in the mass media industry and is strengthening its propaganda machines in 1997.

The senior management of the CultureCom Group, which originally owned 'Tin Tin', is also heading for a big shake-up. Number one administrator, Kwan Yurk Keung, and his close assistant, Chan Kai Cheung, will be joining Oriental Press in mid June to assist Chairman Ma in managing the group business. Tabloid news reported that Chairman Ma had negotiated with Cheng King Han for this position but was not successful. Chairman Ma then contacted Kwan Yurk Keung who had, since last year, wanted to leave. It was therefore a match at the first instance. Kwan Yurk Keung had even been to Taiwan to see Old Ma (the father of Chairman Ma) and was appointed an important post."

5. The part of the article which gives rise to the plaintiff's complaint and this action is the very last sentence which refers to Mr Kwan Yurk Keung had been to Taiwan to meet Old Ma (the father of Chairman Ma) and was appointed an important post.

6. The relevant parts of the Statement of Claim appear in paragraphs 2, 10 and 11 which read as follows :

"2. As is well known to the public :

(1) Mr Ma Sik Chun ('Ma') was one of the founders of the Oriental Daily News, one of the main publications of the Oriental Press Group;

(2) Ma left Hong Kong in 1978 while awaiting trial and has since been residing in Taiwan; and

(3) since he left Hong Kong, Ma held no management position in the Plaintiff or any of its subsidiaries."

"10. The Article in its natural and ordinary meaning meant and was understood to mean that:

(1) the Plaintiff was not controlled or managed by its board of directors but by the father of its chairman, who was not a director of and held no management position in the Plaintiff;

(2) the Plaintiff was in fact controlled and managed by a fugitive from justice; and

(3) the Plaintiff's board of directors was in fact only a puppet of or front for Ma and had no real power over important affairs of the company, such as the appointment of senior personnel."

11. Further or alternatively, if, which is denied, the matters set out in paragraph 2 are not matters of public knowledge, the Plaintiff contends that the Article bore or were understood to bear the meanings pleaded in paragraph 10 above by way of innuendo to those readers of Next Magazine who knew of such matters."

7. The plaintiff's case is therefore pleaded in the alternative. The plaintiff says that either the matters in paragraph 2 of the Statement of Claim are within the general knowledge of ordinary readers or they are additional fact passing beyond the general knowledge of ordinary readers. If the matters are within the general knowledge, then the article bears the natural and ordinary meaning pleaded in paragraph 10 of the Statement of Claim. Alternatively, if these matters are outside the scope of general knowledge and are additional facts, then the plaintiff contends that a reader who has knowledge of these matters would understand the article to bear the innuendo meaning as pleaded in paragraph 10 of the Statement of Claim.

8. I accept that it is permissible for a plaintiff to plead in the alternative when he is in doubt as to whether the extrinsic factor is a matter of special knowledge or whether it is just general knowledge. In Lewis v. Daily Telegraph Ltd [1964] AC 234, Lord Devlin observed that (at p.281) :

"It is said that it may not always be easy to decide whether an extrinsic factor is a matter of special knowledge, or whether it is just general knowledge in the light of which the ordinary, though indirect, meaning of the words has to be ascertained. I do not think that this should present any difficulty in practice. The pleader must ask himself whether he contemplates that evidence would be called in support of the allegation : if he does, it is a legal innuendo, and if he does not, it is not. If he is in doubt, he can plead in two paragraphs; and then if at the trial his opponent agrees or the judge rules that it is a matter of general knowledge, the legal innuendo can be dropped."

9. The defendants in this case do not accept that the matters pleaded in paragraph 2 of the Statement of Claim are matters of general knowledge, it is therefore for this court to decide whether they are matters of general knowledge.

10. There can also be no doubt that in a libel action tried by a judge sitting with a jury, as in this case, it is for the judge to rule as a matter of law whether the words are reasonably capable of bearing the meaning contended for. It is only when the question is answered in the affirmative that the jury will be called upon to decide what the words actually mean : Peregrine Investments Holdings Ltd v. Associated Press [1997] 2 HKC 260, 266G-I.

11. The question of whether the words complained of are reasonably capable of bearing the natural and ordinary meaning as pleaded by the plaintiff has to be approached through the eyes of the hypothetical reasonable reader. Natural and ordinary meaning means meaning in which reasonable people of ordinary intelligence with the ordinary people's general knowledge and experience of worldly affairs would likely to understand them : Lewis v. Daily Telegraph Ltd (supra), p.258. It is not confined to the literal meaning, but may include implications and inferences : Jones v. Skelton [1963] 1 WLR 1362, 1370-1371.

12. Applying these considerations to the present case, the first and foremost question is whether the matters contained in paragraph 2 of the Statement of Claim are matters of general knowledge. In my view, they are not. On the pleadings and on the material before the court, there is no basis for coming to the view that the ordinary readers in May 1996 would possess such general knowledge. This is particularly true of the matter pleaded in paragraph 2(3) of the Statement of Claim. It has been suggested by Mr Cheng, S.C., that the incident of Mr Ma leaving for Taiwan in 1978 while awaiting trial was an extremely big news being widely reported in Hong Kong at the time. The suggestion is, however, neither pleaded nor supported by the material proposed to be placed before the court for the purpose of this trial. In any case, it is a separate matter to speak of Mr Ma remaining in Taiwan since 1978 and that Mr Ma ceased to hold any management position in the plaintiff or any of its subsidiaries.

13. For an ordinary reader of ordinary intelligence who does not possess knowledge of the matters pleaded in paragraph 2 of the Statement of Claim, he would not come to read or understand the last sentence of the article in the manner pleaded in paragraph 10 of the Statement of Claim. The meanings pleaded are neither the literal, implied nor inferred meanings to him.

14. The plaintiff had argued that the pleaded meanings are the most injurious meaning whereas the article is in fact capable of a less injurious meaning, i.e. Mr Kwan was awarded the management position by Old Ma after paying visit to him in Taiwan. It was argued that it is open to the jury to find this as the literal meaning of the words complained of and that this should be left to the jury. Mr Cheng, S.C., submitted that this is a course available to the plaintiff even though this literal or lesser meaning has not been pleaded, relying on the judgment of Lord Diplock in Slim v. Daily Telegraph Ltd [1968] 1 QB 157, 176A-E which reads :

"Where an action for libel is tried by judge and jury, it is for the parties to submit to the jury their respective contentions as to what is the natural and ordinary meaning of the words complained of, whether or not the plaintiff's contention as to the most injurious meaning has been stated in advance in his statement of claim. And it is for the judge to rule whether or not any particular defamatory meaning for which the plaintiff contends is one which the words are capable of bearing. The only effect of an allegation in the statement of claim as to the natural and ordinary meaning of the words is that the judge must direct the jury that it is not open to them to award damages upon the basis that the natural and ordinary meaning of the words is more injurious to the plaintiff's reputation than the meaning alleged, although if they think that the words bear a meaning defamatory of the plaintiff which is either that alleged or is less injurious to the plaintiff's reputation, they must assess damages on the basis of that natural and ordinary meaning which they think is the right one. But where a judge is sitting alone to try a libel action without a jury, the only questions he has to ask himself are : 'Is the natural and ordinary meaning of the words that which is alleged in the statement of claim?' and : 'If not, what, if any, less injurious defamatory meaning do they bear?'"

15. In the case of Oriental Press Group Limited & Another v. Next Magazine Publishing Ltd & 2 Others (unreported), HCA11900/1995, Chung J held that where a so-called lesser meaning is in effect a meaning different from that pleaded in the pleading, the lesser meaning should not be allowed to be left to the jury. I agree. There are good reasons for confining a plaintiff to meaning which he has pleaded or which comes broadly within that he has pleaded : see Slim v. Daily Telegraph Ltd, supra, 185B-C and Allsop v. Church of England Newspaper Ltd [1972] 2 QB 161, 167D-E. It is therefore important to ascertain whether the suggested lesser meaning comes broadly within the meanings pleaded.

16. In this case, the plaintiff argued that the less injurious meaning is covered by paragraph 10(3) of the Statement of Claim. Paragraph 10(3) is dealing with the power and authority or the lack of them on the part of the plaintiff's board of directors. The so-called less injurious meaning, however, is on the conferment of management position on Mr Kwan by Old Ma. They are having different themes or emphasis. The meanings are clearly different. If the plaintiff wishes to rely on this new meaning, the plaintiff ought to properly amend the pleading : Slim v. Daily Telegraph Ltd at pp.184E-185F. Short of amending the Statement of Claim, the plaintiff could not and would not be allowed to rely on this lesser meaning.

17. In short, I hold that the words complained of in their natural and ordinary meaning are not reasonably capable of bearing the defamatory meanings pleaded in paragraph 10 of the Statement of Claim.

18. As to whether the words complained of are reasonably capable of bearing the innuendo meanings pleaded, the plaintiff proposed to amend the Statement of Claim by adding two averments on the additional facts : Firstly, Mr Ma Sik Chun is the father of Mr Ma Ching Kwan, the Chairman of the plaintiff at the material time. Secondly, Mr Ma Shik Chun was commonly referred to as "老馬" (Old Ma) in articles published in the Next Magazine, two of which are "東方馬遙控十五億企業" and "動用十五億東方馬鬥肥佬黎" appearing respectively in the 11 October 1991 and 15 December 1995 issues of the Next Magazine.

19. Clearly, the proposed amendment is a recognition of the missing gap presented by paragraphs 2 and 10 of the Statement of Claim. Without them, even if the matters in paragraph 2 of the Statement of Claim are additional facts known to a particular reader of the Next Magazine, he will not be able to read into the article the innuendo meanings pleaded in paragraph 10. Mr Chow for the defendants does not suggest that the proposed amendment presents prejudice that cannot be compensated by costs. I do not consider the defendants can realistically resist the proposed amendment, albeit made very late in the day. I will therefore deal with the preliminary issue in the context of innuendo on the basis of the proposed amendment.

20. Mr Cheng, S.C., indicated that the plaintiff will prove the two additional averments by reference to the two previous articles in the 1991 and 1995 issues of the Next Magazine. I accept that this is a course open to the plaintiff. But that does not solve the problem of proving the matters pleaded in paragraph 2 of the Statement of Claim being extrinsic facts known to any particular reader of the Next Magazine. The defendants do not accept that the matters pleaded in paragraph 2 are additional facts known to the readers to whom the article is published. The burden therefore remains on the plaintiff to prove that these additional facts were known to at least one of the readers to whom the words were published. In this context, it may be argued that the fact of Mr Ma being a fugitive who had fled to Taiwan is covered by the two previous articles, but the fact stated in paragraph 2(3), namely Mr Ma holds no management position in the plaintiff or any of its subsidiaries is clearly not covered by the two articles.

21. The plaintiff suggested that this can be dealt with by the evidence of Mr Yip Tak Fai. Mr Yip has since 1978 been working for the plaintiff and is currently the publisher of the Oriental Daily News. It is argued that Mr Yip is entitled to give evidence of knowledge of the matters pleaded in paragraph 2 of the Statement of Claim because he is also a member of the public. This in my view is not good enough. For the plea of innuendo, the knowledge of the additional fact is to be possessed by a potential reader to whom the words are published and not by just any member of the public. At any rate, Mr Yip can hardly be regarded as a member of the public in the true sense of the words. He has been an employee of the plaintiff for many years and his knowledge or understanding of the structure of the plaintiff and the composition of the management level of the plaintiff cannot be equated with that of an ordinary member of the public, still less a reader of the Next Magazine.

22. There is insufficient evidence to establish that the extrinsic facts pleaded in paragraph 2 are all within the knowledge of the readers to whom the words complained of are published so to support the plea of innuendo. Without knowledge of these additional facts, an ordinary reader would not come to read or understand the article or the words complained of as bearing the innuendo meanings pleaded in paragraph 10 of the Statement of Claim. The position is in fact no different from that analysed under the natural and ordinary meanings of the words complained of. I therefore also hold that the words complained of are not reasonably capable of bearing the innuendo meanings pleaded.

23. To conclude, I find in favour of the defendants on the preliminary issue.