ORIENTAL PRESS GROUP LTD AND ANOTHER v. FEVAWORKS SOLUTIONS LTD

CACV 53/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 53 OF 2011

(ON APPEAL FROM HCA NOS. 2140 OF 2008 AND 597 OF 2009)

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HCA 2140/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 2140 OF 2008

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J U D G M E N T

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Hon Tang VP:

1.  I have had the advantage of reading the judgments of Hartmann JA (on quantum) and Fok JA (on liability) in draft. I agree with them and have nothing to add.

Hon Hartmann JA:

The issue of quantum

2.  We are in agreement with the judge at first instance that the defendant is liable for one instance of libel only, that libel being the subject of the first action, HCA 2140 of 2008.

3.  The plaintiffs in that action are both corporations, both being part of the same publishing group.  As Fok JA has said, they are respectively the publishers of the Oriental Daily News and the Sun, two Chinese language daily newspapers widely circulated in Hong Kong.

4.  The defamatory words were posted onto the defendant’s website forum on 27 and 28 March 2007.  It appears that they were posted by three registered members using their nicknames.  Taken together, the words – essentially bare allegations – imputed that the plaintiffs were in some way accomplices to the murder of a newspaper vendor, a woman by the name of Sister Ha, and that they had compounded their culpability by avoiding any mention of the case, including the trial of her alleged killers, in their newspapers.

5.  The defendant had been informed by the plaintiffs of the presence of the defamatory words in or about mid-December 2008 but had not ensured their removal until August 2009, a delay of some eight months.  No good reason was advanced for the delay.  It was that act of negligence which founded liability.

6.  The plaintiffs claimed $150,000 each by way of general damages.

7.  On the basis that both plaintiffs were the subject of the same defamatory words, being treated as part of the same group and therefore, for all practical purposes, indistinguishable from each other, the judge determined it appropriate to make a single global award of damages.  That award was one of $100,000.

8.  The award at first instance was not made on the basis that the defendant had been found liable as an author or primary publisher but on the less damaging basis that, as a subordinate distributor, having been informed of the presence of the defamatory words and requested to remove them, it failed to do so within a reasonable time.  We have confirmed that basis to be the correct one.

9.  Even on that finding, Mr McCoy submitted that the global award of $100,000 was inadequate and should be substituted with a higher award that recognised the serious nature of the libel and the extent of its publication.  He further submitted that, as the plaintiffs were separate legal entities, each should separately have been awarded damages; a single award, he said, was wrong in law.

10.  In assessing appropriate general damages for injury to reputation, invariably the most important factor is the gravity of the libel.  See, for example, John v MGN Ltd. [1996] 2 All ER 35, per the Master of the Rolls (paragraph 607):

“… the more closely it [the libel] touches the plaintiff’s personal integrity, professional reputation, honour, courage, loyalty and the core attributes of his personality, the more serious it is likely to be.”

11.  The Master of the Rolls was here referring to the nature of the damage to the reputation of a person.  A corporation, however, is not endowed with courage or loyalty or attributes of such kind that go to the core of a human personality and define that person’s reputation.  As it was expressed by Lord Hoffmann in Jameel (Mohammed) & Another v Wall Street Journal Europe Sprl [2007] 1 AC 359 (paragraph 91):

“In the case of an individual, his reputation is a part of his personality, the ‘immortal part’ of himself and it is right that he should be entitled to vindicate his reputation and receive compensation for a slur upon it without proof of financial loss. But a commercial company has no soul and its reputation is no more than a commercial asset, something attached to its trading name which brings in customers.”

12.  That is not to say that the reputation of a corporate body is a thing of no value.  Lord Scott expressed it thus in the same case (paragraph 120):

“The reputation of a corporate body is capable of being, and will usually be, not simply something in which its directors and shareholders may take pride, but an asset of positive value to it.”

13.  For that reason, a libel is actionable at the suit of a corporation as it is at the suit of an individual without the need to prove that actual damage has been caused: see South Hetton Coal Co Ltd v North-Eastern News Association Ltd [1894] 1 QB 133, CA.

14.  Damages being at large, it is for the court to award such amount as it thinks fit having regard to the circumstances of the case.

15.  The South Hetton Coal judgment, however, contains an important qualification, one that recognises the fundamental difference in the reputation that attaches to a person and a corporation.  The qualification was enunciated by Kay LJ in the following terms (page 148):

“[A] trading corporation may sue for libel calculated to injure them in respect of their business, and may do so without any proof of damages general or special, although, where there is no such evidence, the damages given will probably be small.”

16.  In the present case, the plaintiffs did not seek to prove specific damages, general or special.  Mr McCoy argued that it was not necessary to do so.  There was, first, the gravity of the libel and, second, the extent of its publication.

17.  As to the gravity of the libel, there can be no doubt that it constituted the most serious attack on the reputation of the plaintiffs, suggesting, as it did, that both publishing companies had somehow been complicit in murder.

18.  That being said, while it does not lessen the gravity of the defamatory words themselves, what cannot be ignored is that the words were posted on the website forum by three anonymous persons known only by their nicknames, persons who limited themselves to making bare allegations.  In this regard, the present case is to be contrasted with those in which the allegations are published by a known individual whose pronouncements carry some weight or published as part of a news story.  Yaqoob v Asia Times Online [2008] 4 HKLRD 911, is an example of the latter. In that case, the defendant published an article on its online news service in which it was alleged that the plaintiffs (Yaqoob and two of his companies) were involved in money laundering, terrorist financing and drug trafficking.  The libel, one of gravity, was contained in an article ostensibly researched and thereby, at face value at least, that much more persuasive.  The two corporate plaintiffs were each awarded damages of $150,000.

19.  As to the nature and extent of publication in the present case, Mr McCoy emphasised that, as the entries were posted online, they could be downloaded worldwide.  That is of course a factor of relevance.  That being said, the nature of the publication must be considered in context.

20.  The evidence revealed that the website forum – which, as Fok JA found, was not fashioned to be provocative in nature – sometimes received as many as 5,000 postings per hour.  There was therefore a constant tide of social exchange on a range of subject matters.  Unlike a newspaper or magazine which by definition is restricted in its printed form to a certain number of pages and articles per page, the website forum was constantly being added to, one topic being superseded by another.  There was no evidence that, within this constantly evolving context, the defamatory words attracted any significant identifiable interest.  Nor was there evidence that they were given any particular prominence.  As Fok JA has observed in his judgment (paragraph 138), in light of the sheer volume of postings on the forum, the defendant could not be said to be negligent in not knowing of the existence of the defamatory statements prior to being informed of them.

21.  The ability of persons to use the internet to engage in global conversations is a new phenomenon.  It has already fashioned how societies operate in matters commercial and social and will continue to do so.  The phenomenon is built on the ability to freely pass information and to freely express views.  In short, in Hong Kong it is built on the right to freedom of speech guaranteed under article 27 of the Basic Law and article 16 of the Hong Kong Bill of Rights.  This court has on other occasions recognised that if excessive awards of damages are allowed to stand, they may constitute an impediment to our constitutionally guaranteed right to freedom of speech: see, for example, Cheung Ng Sheong Steven v Eastweek Publisher Ltd [1995] 3 HKC 601, at 623C.  While recognising the importance of the principle, Mr McCoy emphasised the well accepted principle that there is no public interest in the freedom to impart misinformation.

22.  In awarding damages in cases of this kind, what must be found therefore is a balance which, on the one hand, adequately compensates a corporation that has suffered injury to its reputation by being made the victim of a defamation and, on the other, is not so excessive as to make the operation of website forums, such as the one in the present case, so fraught with risk – despite the best endeavours of its managers to ensure the removal of defamatory postings – that there is the danger they will cease to operate.  In my judgment, it is within this context that the test for intervention needs to be determined, namely, whether a reasonable jury could have thought the award granted at first instance sufficient to compensate the plaintiff and re-establish its reputation.: see Cheung Ng Sheong Steven v Eastweek Publisher Ltd, adopting the test applied in A-G v Guardian Newspapers (No. 2) Ltd [1990] 1 AC 109.

23.  During the course of the hearing, we were referred to a number of cases in which general damages were awarded to corporate plaintiffs.  While the determining circumstances of each of those cases were different, they did provide useful points of reference.  Of particular assistance was the recent decision of this Court, differently constituted, in Oriental Daily Publisher Ltd v Ming Pao Holdings Ltd (No 1) [2011] 3 HKLRD 393 in which an award of $150,000 by way of general damages to the corporate plaintiff was, by a majority, reduced to $50,000.

24.  Each case of course must be determined in accordance with its own circumstances.  The assessment of general damages is not an exact science.  Taking into account the circumstances described above, I would reject Mr McCoy’s submission that the global award of $100,000 to the two plaintiffs was inadequate.  I am of the view that the award fell well within the parameters open to reasonable jury to compensate the plaintiffs and to re-establish their reputations.

25.  This leaves just one matter, namely, whether the judge was correct to order that there be a global award of $100,000.

26.  In making the single award, the judge appears to have been guided by the following extract drawn from Gatley on Libel and Slander (11^th edition), page 296:

“… in an action brought by two or more persons as co-claimants in respect of a libel in which they are jointly defamed, e.g. as partners, there can be only one verdict and one judgment in their favour. However where two or more persons sue as co-claimants in respect of a libel in which they are separately defamed, ‘as their damages are several, their damages ought to be severally assessed’.”

27.  The judge at first instance was satisfied that the defamatory words perceived the two plaintiffs not only to be members of the same corporate group but linked by the commonality of their actions.  In short, he was satisfied that the two plaintiffs had been jointly defamed.  In light of the fact that the two plaintiffs had sued as co-claimants, he determined on a single award.

28.  Nothing has been put before us to demonstrate that the extract from Gatley is wrong in law and that the judge was therefore in error to have relied upon it.

29.  For the reasons given I would dismiss the plaintiffs’ appeal on the issue of quantum.

Hon Fok JA:

A.      Introduction

30.  This appeal arises from two defamation actions tried together before Chung J.  The words complained of were posted by third parties on an Internet discussion forum hosted on a website of which the defendants were the provider, administrator and manager.

31.  The issue on this appeal as to liability is whether the defendants should be liable as principal publishers of the defamatory postings (as contended by the plaintiffs) or merely liable as subordinate distributors to whom the defence of innocent dissemination is available (as contended by the defendants and held by the Judge).

32.  An additional issue on this appeal concerns the quantum of damages, the plaintiffs seeking an increase in the amount of damages awarded by the Judge.  I have read, in draft, the judgment of Hartmann JA on the issue of quantum and respectfully agree with it.

B.      The parties

33.  The plaintiffs in the first action, HCA 2140 of 2008, are the Oriental Press Group Limited and Oriental Daily Publisher Limited respectively.  They are also plaintiffs in the second action, HCA 597 of 2009, in which The Sun Newspaper Publisher Limited and Ma Ching Kwan are respectively also plaintiffs.

34.  The corporate plaintiffs publish the Oriental Daily News and The Sun, two Chinese language daily newspapers widely circulated in Hong Kong.  Mr Ma is the honorary chairman of the Oriental Press Group Limited and the son of Mr Ma Sik Chun.

35.  The defendants are the provider, administrator and manager of the website http://forum7.hkgolden.com.  The website hosts an internet discussion forum with the addresses http://forum4.hkgolden.com and http://forum7.hkgolden.com.  The defendants’ forum consists of different channels (computer products, computer software, games, photography, academics, music, finance, sports, entertainment, mobile phone and leisure), of which the leisure channel is the most popular.  The website can be browsed for free but the defendants earn income from advertisements placed on the website.

C.      The defamatory words

36.  The plaintiffs’ actions concern three publications on the website in March 2007, October 2008 and January 2009 respectively and which the Judge referred to as the Mar 2007 words, the Oct 2008 words and the Jan 2009 words.  The Mar 2007 words and the Oct 2008 words were the subject of HCA 2140 of 2008 and the Jan 2009 words were the subject of HCA 579 of 2009.

37.  The Judge found, and there is no appeal against this, that the three publications were defamatory of the plaintiffs.

38.  In respect of the Mar 2007 words, the Judge found that they were defamatory of the plaintiffs in the first action in that they imputed that the plaintiffs were in some way accomplices to the murder of a newspaper vendor, Sister Ha, who was murdered in Sham Shui Po on 22 September 1999.  He also found that the Mar 2007 words imputed that the plaintiffs deliberately avoided reporting the case of Sister Ha.

39.  In respect of the Oct 2008 words, the Judge found that they imputed the defamatory meaning that the plaintiffs and the Oriental Daily News were founded with drug money, that they were involved in drug trafficking and/or money-laundering activities, that they were involved in illegal and/or immoral activities and that they were corrupt, illegal, immoral and unethical.

40.  In respect of the Jan 2009 words, the Judge found that they were defamatory of the plaintiffs in the second action in that they imputed that the two newspapers, the Oriental Daily News and The Sun, were founded with drug money, that they were involved in drug trafficking and/or money-laundering activities and/or immoral activities and that they were corrupt, illegal, immoral and unethical.  He found that those words also imputed that Mr Ma was a member of a family involved in drug trafficking and/or was a member of or associated with the 14K triad society.

D.      The defendants’ website and postings on its forum

41.  A visitor to the defendants’ website can apply to become a member of the forum.  Only members are allowed to make postings on the forum.  In order to become a member, a visitor must complete a registration process.  Before going to the registration page on the website, a visitor must accept a list of the defendants’ terms of services.  This includes a term that the forum prohibits any contents in the messages communicated among the members that contain intimidation, defamation, pornography, harassment and intrusion, and any infringement of third parties’ intellectual property rights or any unlawful act arising out of such contents.

42.  Once the applicant has acknowledged his consent to the terms of services, he will be diverted to a membership registration page on which he must provide personal information including his name, his nickname for the purposes of postings to the forum and an e-mail address.  The e-mail address must be a valid e-mail address and one provided by one of about 1,000 domains provided by recognised internet service providers (“ISPs”), educational institutes and large established companies.  The defendants do not accept e-mail addresses from web-based e-mail services such as hotmail, yahoo mail and gmail.  The purpose of this is to avoid abuse of membership of the forum. By restricting the e-mail addresses as it does, the defendants’ intention is to identify the member and control the member’s behaviour in following the discussion forum rules.

43.  After successful registration, a member is diverted to a page where he will be notified of such registration and will receive a system-generated e-mail containing a password.  He can then use his e-mail address and password to log in to the forum and start making postings to the forum.  After logging in, a member will be on the front page of the forum where the list of channels is available.  There is also a reminder, on the front page, of the rules of the forum in bullet point form.  These are set out in Chinese and, in translation, include the following rules:

(1)  Contents containing offending language, or indecent or pornographic text or graphics, are prohibited;

(2)  Personal attacks are not allowed;

(3)  All contents of the postings at the forum only represent the personal opinion of the relevant subscriber who made the relevant posting, and do not in any way represent the stance or position of the defendants; and

(4)  The defendants have the right to delete any content of the forum without prior notice to the relevant subscriber.

44.  To make a posting, a member selects one of the channels and clicks the “Post” button to access the posting form into which he can input the content of his posting.  After reviewing this (using the “Review” button), the member can proceed to post his posting by clicking the “Post” button again.  This will make the posting visible to the public.  Once posted, a member cannot modify or delete the posting. Instead of originating a posting, a member can also reply to an existing posting by clicking the “Reply” button and then inputting the content of his reply.  After reviewing this, he can then post this reply by clicking the “Post” button.  Replies, like postings, cannot be modified or deleted by the member after posting.  What is posted by a member on the forum will appear immediately on the forum.  The forum does not edit or filter any posting published by any member.  The defendants do not exercise any editorial control over the content of postings, there is no supervision of what is posted onto the website and no control of the content posted.

45.  To ensure members follow the rules of the forum, the defendants have two administrators, who are employed between 10 am and 7 pm from Monday to Friday, to monitor the forum discussion.  They have the power to suspend a member or terminate his membership forthwith, depending on the seriousness of the member’s breach of the rules.  They read postings and remove or disable access to those postings which they consider improper.  However, they are not legally trained and do not have any particular qualifications.

E. The Judgment below

46.  As noted above, the Judge found the words complained of to be defamatory of the plaintiffs and the main issue before him on liability was whether the defendants were liable for their publication.  On this issue, the Judge held that the defendants were subordinate distributors of the defamatory statements.

47.  As such, he went on to consider if the defendants had established the defence of innocent dissemination.

48.  In this regard, the Judge held that there was insufficient evidence to conclude that the defendants knew their discussion forum was of a character likely to contain libel.  He found that the Mar 2007 words were posted on 27 and 28 March 2007 and brought to the attention of the defendants by 10 December 2008 but were only removed from the forum in about late August 2009, about eight months after the defendants knew of them.  The Judge found that there had been undue delay on the defendants’ part in removing the Mar 2007 words and inferred that the delay was caused by the defendants’ negligence.  He therefore concluded that the defendants failed to establish the defence of innocent dissemination in relation to the Mar 2007 words.

49.  In respect of the Oct 2008 words, the Judge found they were posted on 24 October and were removed before the commencement of HCA 2140 of 2008 on 28 October 2008.  The Judge accepted that the defendants only became aware of the Oct 2008 words on 27 October 2008 and that the time taken by them to remove them from the forum was reasonable.  He found the defendants were not negligent in relation to the Oct 2008 words and thus had been able to establish the defence of innocent dissemination in respect of them.

50.  In respect of the Jan 2009 words, the Judge found they were posted on 21 January 2009 at 11.25 pm and removed on 22 January 2009 at 11.40 am.  He found the defendants were not negligent in relation to the Jan 2009 words and thus had been able to establish the defence of innocent dissemination in respect of them.

51.  The Judge awarded damages of HK$100,000 for both the 1^st and 2^nd plaintiffs in HCA 2140 of 2008 and dismissed HCA 579 of 2009.

F. Summary of the appellants’ contentions in respect of liability

52.  In support of the appeal on liability, Mr Gerard McCoy SC, leading counsel for the plaintiffs,[1] submitted that the Judge had erred in holding the defendants to be subordinate distributors of the defamatory words.  He submitted that the Judge should have held that the defendants were liable as publishers of those words in the sense of being the first or main publisher of them.  As first or main publisher, the defence of innocent dissemination would not be available and so, it was contended, the defendants were liable for the publication of the words which occurred every time the forum was accessed by visitors and the page on which they were posted was downloaded or browsed.

53.  If this court were not with him on the submission that the defendants were the first or main publisher of the defamatory words, Mr McCoy submitted that section 25 of the Defamation Ordinance had abrogated and superseded the common law defence of innocent dissemination.  Since the section 25 defence was not available to the defendants, it was submitted that the defendants were liable for the defamatory words even if they were merely subordinate distributors of them.

54.  Finally, on the issue of liability, Mr McCoy submitted that the Judge was wrong in finding that the defence of innocent dissemination was made out in respect of the Oct 2008 words and the Jan 2009 words.

G. The questions arising on this appeal in respect of liability

55.  The appellants’ contentions on the issue of liability raise the following questions for determination:-

(1)  Are the defendants, although not the publishers of the defamatory statements as originators, nevertheless to be regarded as primary publishers of those statements?  If not, does the common law of Hong Kong recognise them as subordinate distributors?

(2)  If they are recognised as subordinate distributors, does the common law of Hong Kong include the common law defence of innocent dissemination?  Even if there was such a defence at common law, was it abolished by the enactment of the statutory defence in s. 25 of the Defamation Ordinance?

(3)  Was the Judge right to hold that this defence was made out in respect of the Oct 2008 words and Jan 2009 words?

56.  The issues raised in (1) and (2) above are important and novel issues.  They are important because they arise in the context of publication of statements on the Internet, by which means an extremely large volume of information is transmitted both within Hong Kong and internationally.  At the single click of a button, statements are made available to be read by a potentially huge readership and may be further disseminated.  The potential for abuse is obvious.  At the same time, the Internet is a powerful tool for the protection of free speech, the right to which is guaranteed to every Hong Kong resident under the Basic Law.  They are novel in the sense that the jurisprudence on the liability of ISPs and Internet intermediaries is developing and there is no previous decision specifically dealing with the liability of a website host such as the defendants in this case.

H.  Question (1): defendants primary publishers or subordinate distributors?

57.  Before analysing this question on the facts of this case, it is helpful first to address certain general principles regarding liability for publication of defamatory matter and then the textbook commentaries and cases relevant to the plaintiffs’ contention that the defendants should be regarded as primary publishers of the defamatory statements because they hosted the website on which those statements were posted.

H1. Primary publishers, subordinate distributors and mere conduits

58.  In Hong Kong, the law of defamation is governed by the common law as modified by the provisions of the Defamation Ordinance, Cap. 21.  It is trite that one of the necessary elements of the tort of defamation is publication of the defamatory matter complained of.  Publication is a question of fact and it depends on the circumstances of each case whether or not publication has taken place.[2]

59.  As a matter of general principle, the person who first spoke or composed the defamatory matter, who may be called the originator, is liable provided he intended to publish it or failed to take reasonable care to prevent its publication.[3]  At common law, liability extends to any person who participated in, secured (e.g. by encouraging or procuring) or authorised the publication, including the printer of a defamatory work.[4]  These persons may, for convenience, all be referred to as the primary publishers.  Liability for the publication of defamatory material at common law is strict and so a primary publisher is liable in tort unless, broadly, he establishes a defence such as justification or fair comment or demonstrates that the publication was on an occasion of privilege or establishes one of the specific defences available under the Defamation Ordinance.

60.  This strict liability which applies to primary publishers was, as a matter of common law, qualified by special rules for distributors, who could escape liability by showing lack of knowledge of the defamatory nature of the publication and the exercise of reasonable care.[5]  Such persons might, for example, also have participated in the publication by selling, distributing or handing to another a copy of the newspaper or book in which the defamatory material appears.  These persons may be referred to as subordinate distributors[6] and the common law defence is known as the defence of innocent dissemination.  The onus of proving the facts necessary to establish the defence lies on the person claiming to be a subordinate distributor.

61.  Finally, in this context, the common law also recognises that persons may be involved as intermediaries in the publication of defamatory matter but simply as mere conduits that do no more than fulfil the role of a passive medium for communication.  A telephone carrier or postal service is a prime example of this type of person and such a person does not incur liability for publication.[7] Such a person does not publish at all and therefore does not require (or bear the onus of establishing) the defence of innocent dissemination.

H2. Textbook commentaries

62.  Mr McCoy supported his argument by reference to passages in Gatley and in The Law of Defamation and the Internet (3^rd Ed.) by Dr Matthew Collins.

63.  In Gatley at §6.18 the following propositions are advanced:

“It has been held in England that an internet service provider is a publisher of material which it ‘hosts’ where it is aware that the material is defamatory and the judge was of the opinion that the same was true even if there was no such knowledge.”

(The case of Godfrey v Demon Internet Limited [2001] QB 201, which is discussed below, is cited in support of this.)

64.  At §6.31, Gatley states:

“Hosting. Hosting takes place where an internet service provider stores on its server information (e.g. web pages) supplied by others.”

65.  In Dr Collins’ textbook, the distinction is drawn between Internet intermediaries who are content hosts, those who cache Internet content and those who are mere conduits.  As to content hosts, Dr Collins states at §6.04:

“First, intermediaries may be ‘content hosts’: the operators of networks on which Internet content, such as webpages and bulletin board postings, is stored. Content hosts play a part every time the content stored on their networks is communicated to an Internet user, anywhere in the world, because they are the primary storage site for that content.”

66.  At §17.54, Dr Collins states:

“Hosts In principle, the common law defence [of innocent dissemination] will be available to subordinate distributors of Internet publications. Internet intermediaries who host content on their computer systems are, however, less likely to be categorized as subordinate distributors at common law than other kinds of intermediaries. Although intermediaries such as content hosts, bulletin board operators, and the operators of business networks might not participate in any way in the production of material hosted by them, the relevant question may be whether they have ‘the ability to control and supervise the material’ they host.

Intermediaries who host content on their computer systems will almost invariably have the technical ability to control and supervise the material they host or carry, by configuring their systems so as to prevent IP datagrams from being transmitted to another computer system without first having been reviewed.  Many intermediaries will also have contractual arrangements in place prohibiting their subscribers from using the intermediary’s service for the storage or publication of defamatory material, and reserving the right to monitor, review or edit material.  Where an Internet intermediary is the medium by which defamatory material is published, and without which it would not be published, it seems likely that the intermediary would be an original [i.e. primary] publisher, rather than a subordinate distributor, of the material at common law.”

(The quotation in the first paragraph of the passage set out above is from Thompson v Australian Capital Television Pty Ltd & Ors (1996) 186 CLR 574, a case discussed below.)

67.  Mr McCoy also relied on the summary in Collins at §17.61 which states:

“For all these reasons, it seems likely that the Australian High Court judges who decided Thompson would hold that intermediaries who host Internet content on their computer systems, such as Internet content hosts, bulletin board operators, and the operators of business networks, are not subordinate distributors. They appear to be more analogous to affiliate television stations than to newsagents, bookshops, or video libraries. The position is, however, at least arguably different in relation to intermediaries who merely cache, as opposed to host, content, and in relation to the operators of search engines and aggregation services that leave the selection of feeds to the discretion of their subscribers.”

H3.    Cases dealing with Internet intermediaries

68.  There was no issue in this appeal that content on the Internet is published when it is downloaded or accessed, by being browsed, by a user and each ‘hit’ of the relevant page is a separate publication.  These propositions are now well-established.[8]

69.  It is, however, necessary to consider those decisions which concern the extent to which Internet intermediaries may be liable for such publication.  Three such English cases that call for consideration are: Godfrey (supra), Bunt v Tilly [2007] 1 WLR 1243 and Metropolitan International Schools v Designtechnica Group & Ors [2011] 1 WLR 1743.  The first is a decision of Morland J and the latter two are decisions of Eady J.  Each of the cases involved interlocutory applications and none of them were considered by the English Court of Appeal.

70.  It will also be necessary to consider the Australian High Court decision in Thompson, which Dr Collins relies upon in respect of his comments on Internet hosts.  That case does not concern an Internet intermediary but deals instead with a broadcaster of a live television programme.

H4.    Godfrey v Demon Internet Limited

71.  In Godfrey, an unknown person posted a defamatory message on a bulletin board accessible to the defendant ISP’s subscribers from the ISP’s news server.  On 17 January 1997, four days after the posting, the plaintiff put Demon Internet on notice of the existence of the offending posting and asked for it to be removed.  Demon Internet did not remove the posting which remained accessible to its subscribers until the message was automatically removed from the news server on 27 January 1997.  The plaintiff only claimed damages for libel in respect of the posting after 17 January 1997 when the defendants had knowledge it was defamatory.[9]

72.  Morland J held that Demon Internet was a publisher of the offending posting and struck out the part of the defence relying on s. 1 of the Defamation Act 1996 (as to which see below).  He held, at pp. 208-9, that:

“In my judgment the defendants, whenever they transmit and whenever there is transmitted from the storage of their news server a defamatory posting, published that posting to any subscriber to their ISP who accesses the newsgroup containing that posting. Thus every time one of the defendants’ customers accesses [the relevant newsgroup] and sees that posting defamatory of the plaintiff there is a publication to that customer.”

73.  Godfrey is therefore authority for the proposition that a bulletin board operator with actual knowledge that defamatory material is stored on its computer system is a publisher of that material for the purposes of the law of defamation.  As will be seen, this proposition is uncontroversial and consistent with cases concerning postings on notice boards (which I shall address below).

74.  Where Godfrey may assist the plaintiffs in this appeal, however, is that Morland J also thought that Demon Internet would have been a publisher of the offending posting even in the absence of actual knowledge.  At p. 207, he said:

“At common law liability for the publication of defamatory material was strict. There was still publication even if the publisher was ignorant of the defamatory material within the document.”

75.  Mr McCoy relied on that passage and also the passage, at p. 209, where Morland J rejected the argument that Demon Internet was a mere conduit:

“I do not accept [counsel’s] argument that the defendants were merely owners of an electronic device through which postings were transmitted. The defendants chose to store [the relevant newsgroup] within their computers. Such postings can be accessed on that newsgroup. The defendants could obliterate and indeed did so about a fortnight after receipt.”

76.  Indeed, in Godfrey, Morland J went so far as to express the view obiter that a mere conduit intermediary, who merely operates a network through which material happens to pass from one computer to another, is a publisher of that material at common law.  This view appears at p. 212 in his judgment where, commenting on the American case of Lunney v Prodigy Services Co (1998) 250 AD 2d 230[10], he said:

“In my judgment, at English common law Prodigy would clearly have been the publisher of the … message and therefore Lunney v Prodigy Services Co does not assist the defendants.”

H5. Bunt v Tilly

77.  In Bunt, the claim was brought in respect of statements posted on websites.  There were three individual defendants who apparently posted the statements and the other three defendants were the ISPs of the three individuals.  The claimant asserted that the individual defendants had published the defamatory words via the services provided by the ISP defendants.  The ISP defendants applied to strike out the claims against them.

78.  Eady J found, on the facts alleged, that there was no sustainable claim against the ISP defendants.  At §§36 and 37, he held:

“36. In all the circumstances I am quite prepared to hold that there is no realistic prospect of the claimant being able to establish that any of the corporate defendants, in any meaningful sense, knowingly participated in the relevant publications. His own pleaded case is defective in this respect in any event. More generally, I am also prepared to hold as a matter of law that an ISP which performs no more than a passive role in facilitating postings on the Internet cannot be deemed to be a publisher at common law. I would not accept the claimant’s proposition that this issue ‘can only be settled by a trial’, since it is a question of law which can be determined without resolving contested issues of fact.

37. I would not, in the absence of any binding authority, attribute liability at common law to a telephone company or other passive medium of communication, such as an ISP.  It is not analogous to someone in the position of a distributor, who might at common law need to prove the absence of negligence: see Gatley on Libel and Slander, 10^th ed (2004), para 6-18.  There a defence is needed because the person is regarded as having ‘published’.  By contrast, persons who truly fulfil no more than the role of a passive medium for communication cannot be characterised as publishers: thus they do not need a defence.”

79.  Thus, the ratio of Bunt is that ISPs which perform no more than a passive role in facilitating postings on the Internet cannot be deemed to be a publisher at common law.  They are neither primary publishers, nor are they subordinate distributors. In this regard, Eady J appears to have reached a different conclusion to the obiter view of Morland J in Godfrey to which I have referred above.

80.  It is telling that, as part of his reasoning, Eady J held that, at common law, for a person to be fixed with responsibility for publishing defamatory words, there needs to be present a mental element.  At §§21 to 23, he held:

“21. In determining responsibility for publication in the context of the law of defamation, it seems to me to be important to focus on what the person did, or failed to do, in the chain of communication. It is clear that the state of a defendant’s knowledge can be an important factor. If a person knowingly permits another to communicate information which is defamatory, when there would be an opportunity to prevent the publication, there would seem to be no reason in principle why liability should not accrue. So too, if the true position were that the applicants had been (in the claimant’s words) responsible for ‘corporate sponsorship and approval of their illegal activities’.

22. I have little doubt, however, that to impose legal responsibility upon anyone under the common law for the publication of words it is essential to demonstrate a degree of awareness or at least an assumption of general responsibility, such as has long been recognised in the context of editorial responsibility. As Lord Morris commented in McLeod v St Aubyn [1899] AC 549, 562: ‘A printer and publisher intends to publish, and so intending cannot plead as a justification that he did not know the contents. The appellant in this case never intended to publish’. In that case the relevant publication consisted in handing over an unread copy of a newspaper for return the following day. It was held that there was no sufficient degree of awareness or intention to impose legal responsibility for that ‘publication’.

23. Of course, to be liable for a defamatory publication it is not always necessary to be aware of the defamatory content, still less of its legal significance.  Editors and publishers are often fixed with responsibility notwithstanding such lack of knowledge.  On the other hand, for a person to be held responsible there must be knowing involvement in the process of publication of the relevant words.  It is not enough that a person merely plays a passive instrumental role in the process. (See also in this context Emmens v Pottle (1885) 16 QBD 354, 357, per Lord Esher MR.)”

(Emphasis in original)

H6.  Metropolitan International Schools v Designtechnica Group & Ors

81.  In Metropolitan International Schools, the claim involved an alleged defamatory statement posted on a website operated by the first defendant which provided bulletin boards for discussions by members of the public.  The claim was also brought against Google, the well-known ISP, and its UK subsidiary on the basis that the alleged defamatory comments appeared as a “snippet” of information when an Internet search was carried out under the claimant’s name using Google’s search engine.  The master’s grant of leave to serve the proceedings out of the jurisdiction on Google was challenged before Eady J.

82.  The issue before Eady J was whether the operator of a search engine could be liable for publication.  Eady J granted the application to set aside the order for leave to serve out of the jurisdiction on the basis that Google, as an Internet search engine operator, had no responsibility for the publication of the words complained of.

83.  It is clear that Eady J regarded it as an important factor that, when a search was carried out by a web user via the Google search engine, there was no human input from Google.  This provided a distinction between Google and the compiler of a conventional library catalogue, who might be liable for compiling the catalogue on the basis that liability attached for repeating a libel.  At §53, Eady J held:

“Yet, whereas a compiler of a conventional library catalogue will consciously at some point have chosen the wording of any ‘snippet’ or summary included, that is not so in the case of a search engine. There will have been no intervention on the part of any human agent. It has all been done by the web-crawling ‘robots’.”

84.  At the same time, Eady J also considered whether Google was liable on the basis of the notice board cases (as to which, see below):

“54. The next question is whether the legal position is, or should be, any different once the third defendant has been informed of the defamatory content of a ‘snippet’ thrown up by the search engine. In the circumstances before Morland J, in Godfrey v Demon Internet Ltd [2001] QB 201, the acquisition of knowledge was clearly regarded as critical. That is largely because the law recognises that a person can become liable for the publication of a libel by acquiescence; that is to say, by permitting publication to continue when he or she has the power to prevent it. As I have said, someone hosting a website will generally be able to remove material that is legally objectionable. If this is not done, then there may be liability on the basis of authorisation or acquiescence.”

(Underlining added)

85.  In the result, Eady J considered a search engine to be a different kind of Internet intermediary to that of a website host (§§55 to 58).  He concluded, on the application before him, that it was unrealistic to attribute responsibility for publication to Google, whether on the basis of authorship or acquiescence (§64).

86.  Before leaving this case, it is right to point out that Eady J observed (at §46) that there was “a sustainable claim against the first defendant” (i.e. the party maintaining the website on which the defamatory posts had been made) and noted that judgment had been entered against that party in default.  Unfortunately, it is not clear from the report of the decision whether, as in the case of Godfrey, the claim was only made in respect of the period after the operator of the website had been made aware of the presence of the defamatory postings on the website.

H7.    Thompson v Australian Capital Television Pty

87.  Although not a case involving an ISP, Dr Collins suggests that the Australian High Court judges who decided Thompson would hold that Internet intermediaries who hosted content are not subordinate distributors and would be liable as primary publishers.

88.  In Thompson, a television station broadcasting to the Australian Capital Territory and nearby parts of New South Wales (Channel 7) was liable for the publication of a live current affairs programme produced by a different network in Sydney (Channel 9).  The defendant television station had received and simultaneously telecast the programme by a receiving station in Canberra.  During the course of the programme an alleged defamatory statement was made concerning the plaintiff.  Channel 7 received the program under an agreement with Channel 9 under which no opportunity was provided to Channel 7 to monitor independently the statements made in it.  Channel 7 had no foreknowledge of the content of what was to be broadcast and did not edit, and had no opportunity to edit, the programme before it was broadcast.

89.  Four of the five judges in the Australian High Court held that the television station was an original publisher of the programme and was not able to avail itself of the defence of innocent dissemination.  Brennan CJ, Dawson and Toohey JJ reached this conclusion in their joint judgment on the basis that it was the defendant television station’s own decision to telecast the programme instantaneously and without monitoring and that it therefore could not claim to be a subordinate distributor simply because it had chosen to adopt the immediacy of the programme, which it did for its own purposes. Gaudron J concluded that the television station should not be treated as a subordinate distributor because, in her view, a person who published by authorising a communication was not a subordinate distributor.

90.  The decision in Thompson is to be contrasted with the decision of the US District Court in Auvil v CBS ’60 Minutes’ 800 F.Supp.928 (1992) in which it was held that affiliate television stations broadcasting a national current affairs programme were not liable for defamatory statements on the basis they had republished the programme only as mere conduits and would only be liable if they knew, or had reason to know, of the defamatory character of the publication complained of.  This was notwithstanding that the television stations had received the current affairs programme three hours before they broadcast it, had a contractual right to edit the programme and had received a telex setting out a brief summary of the content of the programme.  In these three respects, the case differed from the facts in Thompson.

91.  It should be noted that Dr Collins has suggested (at §17.52) that Thompson was wrongly decided.  He contends that Channel 7 should not have been denied subordinate distributor status and should have been entitled to the benefit of the innocent dissemination defence since it did not know and had no reason to know that the programme contained defamatory matter or a libel, and its lack of knowledge was not due to negligence on its part.

H8.    Notice board cases

92.  Under the common law of England and Australia, failure by a defendant to remove another’s defamatory material from property within the defendant’s control can in some circumstances make the defendant responsible for the publication of the material.

93.  In Byrne v Deane [1937] 1 KB 818, the English Court of Appeal considered the question of liability in respect of an allegedly defamatory notice affixed to the wall of a golf club.  The notice had been placed on the wall by a third party without the consent of the proprietors of the club, one of which was also the secretary.  Under the rules of the club, notices could only be posted in the club premises with the consent of the secretary. It was held that the proprietors had taken part in the publication of the notice by allowing it to remain on the wall and by failing to remove it after they knew of its presence.  Greer LJ, with whom Greene LJ agreed, held that both the defendants were taking part in the publication by allowing the defamatory statement to remain on the wall of the club with knowledge that by not removing it the notice would be read by other people (pp. 829-830).  Slesser LJ considered that the secretary was responsible for publishing the statement since, by having read it and having control over the walls of the club as far as the posting of notices was concerned, there was evidence that she did promote and associate herself with the continuance of the publication the circumstances after the date when she knew the publication had been made (p. 835).

94.  In Urbanchich v Drummoyne Municipal Council, unrep., Case No. 17557 of 1985 (22.12.88), posters defamatory of the plaintiff had been affixed to bus shelters under the control of a transit authority.  The plaintiff asked the transit authority to remove the posters but it failed to do so.  On an application for a separate trial, Hunt J held that, if the jury accepted the facts alleged, the transit authority would be liable for publishing the posters.  As to the applicable test in law, he held:

“In a case where the plaintiff seeks to make the defendant responsible for the publication of someone else’s defamatory statement which is physically attached to the defendant’s property, he must establish more than mere knowledge on the part of the defendant of the existence of that statement and the opportunity to remove it. According to the authorities, the plaintiff must establish that the defendant consented to, or approved of, or adopted, or promoted, or in some way ratified, the continued presence of that statement on his property so that persons other than the plaintiff may continue to read it – in other words, the plaintiff must establish in one way or another an acceptance by the defendant of a responsibility for the continued publication of that statement. Such conduct on the part of the defendant may of course be established by inference. Indeed, in most cases there will be no evidence of any such acceptance by the defendant expressly, and it can only be established by inference. In Byrne v Deane, the inference of consent by the defendants to the continued publication of the verse was drawn from the defendants’ knowledge of the existence of the defamatory statement, their right to remove it and their failure to do so (see 829-830, 835, 837-838). As Greene LJ put it (at 838): ‘The test, it appears to me, is this: having regard to all the facts of the case, is the proper inference that, by not removing the defamatory matter, the defendant really made himself responsible for its continued presence in the place where it had been put?’ ”

95.  It is noteworthy that Dr Collins opines (at §6.29):

“The Byrne v Deane line of authority is capable of applying to Internet intermediaries who are on notice that their computer systems host defamatory matter, but who fail to take steps to remove it.”

(Underlining added)

H9.    Were the defendants primary publishers or subordinate distributors?

96.  In the absence of authority directly on the point, the answer to this critical question must be arrived at by applying the general principles as to the circumstances in which a person will be regarded as a primary publisher, a subordinate distributor or a mere conduit.

97.  As to the latter category, it is not contended on behalf of the defendants that they were mere conduits such that they should not be considered to have participated in the publishing of the defamatory statements at all.  In my view, the defendants’ acceptance that they were not mere conduits is correct.  In order for the postings to have come into existence, the forum had to be established and maintained on the website and configured so that postings could be made by members of the forum.  The extent of the defendants’ participation was such that, in my opinion, they had more than a merely passive role in the facilitation of the postings.

98.  As noted above, at common law, newspaper vendors and proprietors of libraries have been held to be subordinate distributors rather than primary publishers.  I do not, however, think that the activities of newspaper vendors and proprietors of libraries are particularly analogous to the role of the host of a website forum.  In any event, as Eady J pointed out in Bunt,[11] analogies are unlikely to be complete given the novelty of the Internet.

99.  There is no authority binding on this court as to the liability of a website host as a publisher of defamatory postings made on a forum by third parties.  Nor do any of the English decisions in Godfrey, Bunt or Metropolitan International Schools provide an exact parallel with the present case.  As explained above, the ratio of Morland J’s decision in Godfrey is limited to the proposition that a bulletin board operator with actual knowledge that defamatory material is stored on its computer system is a publisher of that material for the purposes of the law of defamation.  Bunt and Metropolitan International Schools concerned Internet intermediaries held by Eady J to be mere conduits and not to have participated in the publication of the defamatory matter at all.

100.  Mr McCoy submitted that a defamatory posting on the Internet was a particularly serious form of publication since it was available in perpetuity and easily accessible.  He relied on the fact that the defendants could have arranged their forum so that they had the ability to edit postings on the forum before they became generally available to be browsed by visitors to their website.  Instead, they chose to configure the forum so that postings would be instantaneously readable.  The present case was no different, it was submitted, to the circumstances which led the Australian High Court in Thompson to conclude that Channel 7 was not a subordinate distributor: they had “the ability to control and supervise the material”[12] and they published “by authorising a communication”.[13]

101.  Mr McCoy further contended that there was a voluntary assumption of risk by the defendants for the defamatory nature of postings on the forum.  This, he submitted, was the consequence of a person hosting a forum on the Internet.  By hosting the website, Mr McCoy submitted, the defendants lent authority to the material. This was not a case where the defendants were mere conduits because they stored the defamatory material on their servers and it was there available to be browsed by visitors to the forum at any time.

102.  Mr McCoy submitted that, if the defendants were not primary publishers and could avoid liability as subordinate distributors, the plaintiffs would be limited to pursing legal remedies against the originator of the defamatory postings.  The pursuit of such remedies would probably require the pursuit of one or more Norwich Pharmacal discovery applications to ascertain the identity of the originator: against the defendants for the identity of the e-mail account under which the originator was registered as a member of the defendants’ forum; and against the ISP through whom the originator maintained that e-mail account. The originator might then prove to be a man of straw.  In short, the pursuit of the plaintiffs’ legal remedies would be complicated and potentially fruitless.

103.  Despite the persuasiveness with which they were advanced, I have come to the conclusion that Mr McCoy’s submissions should not be accepted and that liability should not be held to attach to the defendants as primary publishers of the defamatory material.

104.  First, I do not regard the defendants as being in the same position as the broadcaster of a live television programme.  Just as the context of the Internet is clearly different to that of the publication and sale of a newspaper, it is also different to the broadcasting of a live television programme.  It is difficult, in my opinion, to equate the voluntary assumption of liability by the television station in Thompson with the activities of a website forum host.  It is true that Channel 7, despite having the ability to control and supervise the material, simply chose, for its own purposes, to adopt the immediacy of the programme by televising it live without exercising any editorial control over it.  In circumstances in which it would have been relatively straight forward to delay the transmission of the television broadcast by a matter of minutes or even seconds in order to determine whether any part of the material should be expurgated, it is understandable why Gaudron J took the view that Channel 7 authorised the publication.

105.  The defendants’ position as a website host is very different.  The evidence in the present case, which was not challenged, was that, at any given time, there might be 30,000 users of the defendants’ website online and that, during peak times, there might be over 5,000 posts generated in an hour.  Filtering by keyword is not possible, since defamatory meanings may be communicated by a combination of words, which may be individually innocuous.  Manual screening in the circumstances would be impractical since, it was estimated, the defendants would need to hire at least 160 staff on a 24-hour basis daily to screen every posting sent to the defendants’ forum.  In short, the evidence shows that it would be wholly disproportionate to expect the defendants to vet every posting on the forum.  Even if it were possible to do so, the ascertainment of a defamatory meaning is not simply a mechanical matter and requires the exercise of judgment.  The reality is that the imposition of legal responsibility as a primary publisher might well cause many website hosts to cease hosting their websites.

106.  It is true that the defendants have the technical ability to remove postings from the website but that ability on its own is not sufficient, in my opinion, to give rise to a voluntary assumption of liability for the content of any messages posted on the forum as from the very instant the material is posted.

107.  Secondly, as regards the textbook authorities relied upon by Mr McCoy, I would observe that Gatley does not comment on the correctness or otherwise of the view expressed by Morland J in Godfrey that a website host would be liable even in the absence of knowledge that defamatory material was being hosted.  Dr Collins’ view in §17.54 is expressed in tentative terms as to “likely” liability as a primary publisher.[14]  To the extent he expresses the view that Internet intermediaries who host content will have the ability to control and supervise the material they host, that would seem to assume practical ability.  Here, the evidence would suggest that such ability was impractical.

108.  It is also to be noted that Dr Collins’ view at §17.61 is stated by reference to the likely stance of the Australian High Court judges who decided Thompson.  Since he elsewhere suggests (at §17.52) that Thompson was wrongly decided, it is arguable that Dr Collins’ view of the role of a website forum host would be different but for that Australian High Court decision.  It is also to be noted that he expresses the view, at §17.63, that:

“Depriving Internet intermediaries who merely host or cache the defamatory content of others … of the benefit of a defence of innocent dissemination, in the absence of actual knowledge of the existence and character of the offending material would generally, however, be to place an intolerable burden upon them.”

(Underlining added)

109.  Thirdly, as Eady J observed in Bunt (at §§21 to 23, quoted above), for a person to be held responsible for publishing defamatory matter, there must be knowing involvement in the process of publication of the relevant words.  I would be slow to conclude that the defendants should be fixed with that degree of knowledge in respect of each and every posting out of thousands of postings made hourly to their website forum.  It is true that the host of a website forum must be aware that postings are likely to be made since that is the purpose of hosting the forum.  To that extent the host will be aware of the process of publication in a general sense.  Depending on the subject of the channel of the forum or the particular thread of any discussion, it may also be anticipated that controversial comments or opinions may be aired.  However, it does not follow that anticipation of this fixes the website host with knowing involvement in the process of publication of the relevant words.  As Nielsen J noted in the Auvil case (at p. 932):

“All defamatory material may be controversial, but the converse is not true.”

110.  Fourthly, in the absence of authority directly on this point, I would, for my part, regard the defendants here as being in the same position as the person responsible for a notice board. In my opinion, the host of a website forum can be regarded as being in a position similar to that of someone who makes a notice board available to third parties to post notices. In such circumstances, the analysis of Hunt J in Urbanchich is, in my view, a persuasive basis on which to impose legal responsibility for publication, namely by asking the question whether it can be inferred that the website host accepts responsibility for the published material.[15]

111.  Given the number and popularity of social networking sites today, it is reasonable to assume that there is a huge number of web postings placed on virtual notice boards or walls by the hour (if not by the minute).  It might be thought surprising if readers of comments posted on those notice boards or walls thought that the website host had accepted responsibility for the publication of any and all defamatory material on the forum regardless of the host’s knowledge of the presence of the particular words.  I do not think such an inference would be warranted, nor that it would be fair to impose legal responsibility for publication on the website host as from the very instant the material was posted.  Indeed, if such responsibility were to be inferred for the website host, one might also ask rhetorically why it should not also be inferred for the person whose notice board or wall the message was posted on.  That conclusion would seem to follow from the plaintiffs’ argument, yet this would have far-reaching ramifications for social networking sites.

112.  A more logical approach, in my opinion, would be to impose legal responsibility for publication on the basis of acquiescence.  On this basis, liability for defamatory material would attach to the host of a website forum once it had been notified of the existence of the material and requested to remove it but had failed to do so within a reasonable time.  This approach is also consistent with the observation of Eady J in §54 of Metropolitan International Schools and the commentary in Collins at §6.29.

113.  Fifthly, to impose legal responsibility on the host of a website forum for defamatory postings as primary publisher might well, as I have already observed, result in the closure of website forums.  To the extent that this would suppress the thousands, if not millions, of non-defamatory postings that might be made to such forums, it is strongly arguable that this would be a disproportionate interference with the freedom of speech guaranteed to Hong Kong residents under article 27 of the Basic Law and article 16 of the Hong Kong Bill of Rights.

114.  As against the freedom of speech, which he accepted was an important factor in this argument, Mr McCoy advanced the countervailing point (relying on the speech of Lord Hobhouse in Reynolds v Times Newspapers Ltd [2001] 12 AC 127 at p. 238A-C) that there is no public interest in the publication of misinformation.  That proposition must, of course, be accepted as correct but holding a website host to be the subordinate distributor of defamatory material (thereby placing on it the onus of establishing the defence of innocent dissemination to escape liability for defamation) provides, in my opinion, a sufficient safeguard against the publication of misinformation.

115.  Sixthly, the conclusion that the defendants are not primary publishers of material found to be defamatory does not leave the plaintiffs without remedy.  The originator of the posting will remain liable for the defamation as primary publisher.  So too, a website host who fails to establish the defence of innocent dissemination will be liable as a subordinate distributor.

116.  In conclusion on this issue, I would hold, in agreement with the Judge below, that the defendants were not primary publishers of the defamatory words but were instead subordinate distributors.

117.  I would add as a caveat, however, that the above conclusion is not intended to apply to every website host regardless of the particular facts of the publication complained of and it does not mean that there may not be circumstances in which a website host will be liable as primary publisher of postings on its website.  This might occur, for example, if it were established that the website host had participated in the knowing publication of the relevant defamatory words by, in effect, inviting defamatory comments on a particular person.  That is not the case here.  Other factual scenarios may also exist in which it may be inferred that the website host has accepted or should be taken to have accepted responsibility for the website content.  On the facts of this particular case, however, no such inference can, in my opinion, be drawn.

I. Question (2): defence of innocent dissemination?

118.  I next turn to the question of whether, as a matter of law, the defendants’ liability in tort for defamation is subject to the defence of innocent dissemination.

119.  At common law, in England, a subordinate distributor might be relieved of liability for the publication of defamatory material if he proved that:

(1)  he did not know that the book or paper contained the libel complained of;

(2)  he did not know that the book or paper was of a character likely to contain a libel; and

(3)  such want of knowledge was not due to any negligence on his part.[16]

(Slightly different formulations of the above questions have been suggested – see the commentary at FN150 in §6.19 of Gatley referring to Sun Life Assurance Co. of Canada v W.H. Smith and Son Limited (1934) 150 LT 211 and Goldsmith v Sperrings Ltd [1977] 1 WLR 478 – but, for present purposes, those differences are not material.)

120.  In England, the position in respect of subordinate distributors is now different by reason of the introduction of s. 1 of the Defamation Act 1996.  This recast, in England, the common law defence of innocent dissemination and somewhat extended it so that some persons who at common law would have been primary publishers (i.e. a person who participated in, secured or authorised the publication) may now claim the benefit of the defence: Gatley §6.4.[17]  The statutory defence does not, however, extend to the author, editor or publisher (in the commercial sense) of the defamatory statement.  As noted above, these persons are primary publishers whose liability at common law remains strict.

121.  The defence of innocent dissemination appears also to be part of the common law of Australia.[18]

122.  In Hong Kong, there is a statutory defence for a person who publishes defamatory material innocently under s. 25 of the Defamation Ordinance.  However, this is not applicable unless an “offer of amends” has been made and has not been withdrawn (see s. 25(1)(b)).  An offer of amends is an offer to publish a correction and sufficient apology.  There was no such offer of amends in the present case so the defence is not applicable and has not been relied upon by the defendants.

123.  Mr McCoy invited us to hold that the defence of innocent dissemination, as a matter of common law in Hong Kong, was superseded by that statutory provision.

124.  I do not accept that contention.

125.  So far as English law is concerned, Gatley states (at §6.4) that the common law defence available to distributors is not, in terms, abolished but opines that, in view of the statutory defence, it seems unlikely that hereafter it will be relied on.  In Metropolitan International Schools, Eady J held (at §70) that:

“… the defence was not actually abolished in 1996 (albeit no doubt effectively superseded). I have come to that conclusion because the statute does not say that the common law defence is indeed abolished”.

126.  Similarly, there is, in my opinion, no reason to regard the enactment of s. 25 of the Defamation Ordinance as having abolished the common law defence of innocent dissemination in Hong Kong.  The s. 25 defence is not in terms a statutory defence of innocent dissemination.  It provides a defence (referred to in the heading of the section as “Unintentional defamation”) by way of an offer of amends.  There is, therefore, no direct equivalence of the s. 25 defence to the common law defence in the way that s. 1 of the Defamation Act 1996 may be said to correspond to that defence.  Further, and in any event, it is a principle of statutory construction that the legislature should not be taken as effecting a fundamental alteration to the general law except by express statutory wording.[19]

127.  I would therefore hold that it is a defence available to a subordinate distributor.

J.  Question (3): defence made out in respect of Oct 2008 words and

  Jan 2009 words?

128.  As I have already noted, the Judge held the defence was not made out in respect of the Mar 2007 words but was in respect of the Oct 2008 words and the Jan 2009 words.  There is no challenge by the defendants to the finding in respect of the Mar 2007 words. The plaintiffs, however, challenge the Judge’s finding that the defence was made out in respect of the latter two defamatory statements.

129.  As regards the first element of the defence, there was no dispute that this was dealt with by the Judge at §56 of the Judgment:

“56. There is no dispute the defendants were unaware of the posting of the defamatory statements until they were brought to the defendants’ attention by the plaintiffs.”

130.  Mr McCoy’s submissions in this regard focused on the second and third elements of defence.  As regards the second element of the defence, Mr McCoy submitted that the Judge did not deal adequately with this.  He submitted that the Judge did not deal at all with the third element of the defence and that, since there was no finding that the defendants’ want of knowledge was not due to negligence on their part, this court should hold that the defence was not established or order a re-trial of the issue of whether the defence was made out.

131.  In support of the contention that there was negligence on the part of the defendants, Mr McCoy relied on the proposition that negligence may be inferred from the fact that a defendant sold or distributed a newspaper after being warned of libellous matter in a former issue.[20]  Here, it was submitted, the defendants had been warned about the Mar 2007 words when the Oct 2008 words were published and had already been sued in the first action when the Jan 2009 words were published.  In the circumstances, it was contended that, having been put on notice, the defendants were obliged to change the modality of their operation if they wished to avail themselves of the defence.

132.  The reference to the need to consider the modality of the defendants’ operation derives from Romer LJ’s judgment in Vizetelly at p. 180 where, in setting out the defence of innocent dissemination, he said:

“The result of the cases is I think that, as regards a person who is not the printer or the first or main publisher of a work which contains a libel, but has only taken, what I may call, a subordinate part in disseminating it, in considering whether there has been publication of it by him, the particular circumstances under which he disseminated the work must be considered. If he did it in the ordinary way of his business, the nature of the business and the way in which it was conducted must be looked at; …”.

133.  It was Mr McCoy’s submission that a website forum like the defendants’ forum here was, by its nature, likely to give rise to gossip and sensational disclosures such that one might expect to find defamatory postings.  The defendants, he submitted, must have been on notice since they required their members not to post messages which were, amongst other things, defamatory.  Mr McCoy pointed to the fact that a member whose membership was terminated could simply re-apply for membership using another e-mail address.  Having been put on notice, it was contended that the defendants were negligent in the way they operated their business and so should be liable for the latter two defamatory statements.

134.  I do not agree that the Judge did not deal adequately with the second element of the defence.  At §67 of the Judgment, the Judge addressed the criticism that “the defendants’ discussion forums were of a character likely to contain libel” and said:

“67. As regards [that criticism], I do not consider there to be sufficient evidence that the defendants knew their discussion forum was of a character likely to contain libel. The evidence shows the discussion forums to be one of the most popular in Hong Kong, with numerous messages posted. The messages relevant to the actions were but only some of the total number of messages. The originators of the various defamatory statements have different pseudo-names.”

135.  It is true that the first sentence of §67 might be thought to suggest the Judge mistakenly suggested the onus was on the plaintiffs to establish the relevant knowledge on the part of the defendants. However, it is quite clear from other parts of the Judgment (see §§58, 60, 78 and 80) that the Judge was well aware that the burden rested on the defendants to make out the elements of the defence.  The Judge would appear to have addressed the matter as he did at §67 simply because he was there setting out his view of the merits of the criticism directed at the defendants.

136.  In any event, I consider it was open to the Judge to find on the evidence that the defendants did not know the discussion forum was of a character likely to contain a libel.  The nature of the website forums hosted by the defendants was not, in my view, such as to suggest they were intended, as Mr McCoy contended, for gossips or for persons willing to make grave and false allegations.  The mere fact that the defendants had a rule that members should not post defamatory material is not sufficient to make them aware that the website forums would be likely to receive defamatory postings.  That the present case involves claims in respect of three postings to a forum which sometimes receives as many as 5,000 postings per hour demonstrates, in my view, that it cannot be said that a defamatory posting is likely as opposed to merely a possibility.  The fact that persons could make defamatory statements on the defendants’ website forum, which possibility was accepted by the defendants’ project manager when he was cross-examined, does not mean that the defendants’ contention that they did not know that the discussion forum was of a character likely to contain a libel must be rejected.

137.  As regards the third element of the defence, I accept the submission of Mr John Reading SC, leading counsel for the defendants,[21] that §67 of the Judgment should be read as constituting a finding that the relevant want of knowledge on the part of the defendants was not due to their negligence.  There, the Judge referred to the volume of the messages posted and the fact that the originators of the statements used different “pseudo-names”. These references must clearly have been intended by the Judge to explain the reason he considered the defendants had established the defence of innocent dissemination in respect of the Oct 2008 words (Judgment §78) and in respect of the Jan 2009 words (Judgment §80).  In both the latter two paragraphs referred to the Judge expressly found the defendants were “not negligent” in respect of the respective defamatory words.

138.  In my opinion, the Judge was justified in reaching the conclusion that the defendants were not negligent in this regard. The context of the Internet is very different to that of a newspaper vendor or travelling library.  Cases such as Vizetelly, Batten v Pall Mall Deposit and Sun Life Assurance Co. of Canada, in which the relevant subordinate distributor was found to have been negligent in not knowing that the relevant publication contained a libel are all cases in very different contexts to that of the Internet.  I accept that, in the light of the sheer volume of postings on the defendants’ forum, the defendants could not be said to be negligent in not knowing of the existence of the defamatory statements complained of or the likelihood of their being on the website forum prior to being informed of the same.

139.  Mr McCoy criticised the Judge for taking an irrelevant matter into account in the context of the defence by referring to the reasonableness of the time taken by the defendants to remove the defamatory words.

140.  I do not accept that this matter was irrelevant.  In the light of the notice board cases, which I have held provide a proper basis for imposing legal responsibility on the defendants in the present case for publication, the time within which the defendants reacted to being notified of any alleged defamatory postings on the website is plainly relevant to the question of whether liability should attach for acquiescence in those statements: see, in this context, §54 of Eady J’s judgment in Metropolitan International Schools.  I can see no basis for disturbing the Judge’s conclusions that the time taken for the defendants to remove the Oct 2008 words and the Jan 2009 words was reasonable.

K. Conclusion on liability

141.  For the above reasons, I would conclude that the Judge was correct in holding the defendants to be subordinate distributors to whom the defence of innocent dissemination was available.  Similarly, I would also conclude that the Judge was correct to hold that the defence was, on the facts of this case, made out in respect of the Oct 2008 words and the Jan 2009 words.  I would therefore dismiss the plaintiffs’ appeal on the issue of liability.

Hon Tang VP:

142.  The appeal is dismissed with an order nisi that the plaintiffs pay the costs of the appeal such costs to be taxed unless agreed.