Seven West Media’s chairman, Kerry Stokes, and his commercial director, Bruce McWilliam, have been ordered by a court to hand over thousands of emails exchanged with Ben Roberts-Smith’s legal team and other documents relating to the soldier’s failed defamation action.
Roberts-Smith, a recipient of the Victoria Cross, failed last month in his defamation case against three Australian newspapers he alleged had defamed him as a war criminal.
Justice Anthony Besanko found the newspapers successfully proved – to the civil standard of balance of probabilities – that Roberts-Smith was complicit in the murder of four unarmed civilians while serving in the SAS in Afghanistan, as well as bullying and threatening colleagues, and intimidating a woman with whom he was having an affair.
Roberts-Smith has appealed that decision.
The current legal challenge relates to the costs of that year-long defamation trial, believed to be up to $35m.
Roberts-Smith has agreed to pay costs on an indemnity basis. But the newspapers – the Age, the Sydney Morning Herald, and the Canberra Times – are seeking a third-party costs order against Seven West Media, Roberts-Smith’s former employer and funder of the defamation action, saying it is an interested party to the case.
The newspapers have subpoenaed documents and correspondence sent between Stokes, McWilliam, law firms representing Seven, and lawyers for Roberts-Smith. The newspapers are arguing Seven exerted a measure of control over the defamation proceedings and should therefore be liable for costs.
Lawyers for the newspapers say more than 8,600 emails were exchanged between Seven’s commercial director, McWilliam, and Roberts-Smith’s legal team during the course of the trial, demonstrating a clear interest and influence.
But Neil Young, KC, acting for Seven, Australian Capital Equity (ACE), Stokes, and McWilliam, had argued the subpoenas were “far too wide” and should be set aside. That the thousands of emails were relevant was speculation, he said.
“There is no strong presumption … that indicates something more than observation [of the case] was going on,” Young said.
On Monday, Justice Besanko found largely in favour of newspapers – allowing the subpoenas calling for the documents and correspondence to stand – with only minor amendments. He will deliver his reasons at a later date.
The Seven Network funded the defamation action brought by Roberts-Smith, the then general manager of the network’s Queensland operations. He has since resigned in the aftermath of the defamation loss.
The loan agreement with Seven stated the company was “prepared to make available funding of legal costs” to Roberts-Smith.
“We recognise that part of you being a target by our opposition [Nine/ Fairfax] in the stories the subject of the actions, arises out of your employment by Seven,” the loan agreement said.
That agreement with Seven was superseded by a loan from Stokes’s private company ACE. An earlier judgment from Justice Besanko detailed that loan agreement which appeared to give ACE significant influence over Roberts-Smith’s conduct of his defamation action.
One clause of loan agreement is titled: “Oversight and management of the defamation proceedings or inquiry.”
The clause reads: “The Company [ACE] understands the Seven Network Operation Ltd [SNOL] legal team have considerable experience with the defamation proceedings. In the company’s view, the SNOL legal team’s continued oversight and management of the defamation proceedings and inquiry is important for a successful outcome to the proceedings. You agree to take whatever actions SNOL reasonably requires to appeal or to recover costs.”
ACE also stood to claim 15% of any damages over and above the loan repayment won by Roberts-Smith if his defamation claim was successful.
Ultimately, Roberts-Smith’s claims were dismissed by the judge, so there were no damages.
No criminal charges have been laid against Roberts-Smith, and he maintains his innocence of all allegations.
He remains under investigation by the government’s office of the special investigator, established to investigate allegations of war crimes committed by Australian soldiers in Afghanistan.
The costs hearing is listed for 4 September.
