The decision is an important case for the media industry in that it covers a number of important principles, including the public interest defence and the level of damages awarded to Cato by the High Court.

How the case unfolded

At the heart of the saga was the New Zealand showjumping team’s six-week tour of Australia in March and April 2017. It was an allegedly troubled tour, with some members of the team complaining about the conduct of others.

Eventually, the parties agreed to mediation between themselves, without involving Equestrian Sports New Zealand (ESNZ).

Cato represented the complainants in mediation and on November 30, 2017, a statement was released saying the parties had reached a settlement.

It said the details of the settlement were confidential except to the extent that the sport’s authorities had been informed, the coach had agreed he would not hold any future role with Jumping NZ and his daughter, one of the team members, had apologised to the complainants for her conduct.

Horse & Pony magazine, which was not sent the statement, published an article on December 3, 2017, under the heading “What goes on tour doesn’t stay on tour”.

According to an earlier judgment, the article covered a range of angles – it backgrounded the tour, ESNZ’s response, the mediation hearing, and how the statement came to be released. It raised questions about ESNZ’s role and Cato’s own work on the case, including her releasing the statement to a website owned by her mother.

In August 2022, a jury found the article was defamatory of Cato.

According to Justice Robinson’s High Court judgment, the jury found the article both meant and was understood to mean that “the plaintiff had acted unethically and unprofessionally (or improperly) as counsel for the complainants” on several fronts, including:

The jury did not agree with the position of the defendants – Horse & Pony publisher Manaia Media Ltd, editor Rowan Dixon and writer Jane Thompson – that the lawyer had suffered only minor harm.

It awarded Cato compensatory damages of $225,000 and punitive damages of $15,000.

Justice Robinson then looked at whether the magazine, its editor and journalist could rely on the public interest defence, set out in the previous Durie vs Gardiner case – on the basis that the subject matter was of public interest and that communication was responsible.

The defendants pleaded that their article was a responsible communication on 13 matters of public interest, including the performance of former equestrian Olympians at international competitions; the conduct of ESNZ as a national sports organisation, and the conduct of ESNZ members while representing New Zealand.

The judge ruled that the subject matter of the article “broadly and as a whole was of public interest”.

However, “I do not consider the defamatory statements about the plaintiff related to matters of public interest”.

Court of Appeal decision

In its decision released on Thursday, Court of Appeal judges Mallon, Cooke and Collins allowed the defendants’ appeal and ordered a retrial.

The Court of Appeal judges found the article met the public interest requirement of the defence and that the High Court judge had understated the public interest in the subject matter.

However, the Court of Appeal said, it was “unnecessary to implicitly criticise Ms Cato in the manner and tone of the article and it fell short of being a responsible communication because of this”.

“We therefore agree with the judge that the public defence was not made out, albeit that we consider it was a more finely balanced case than the judge did.”

The Court of Appeal looked at the evidence of Ralston, the high-profile former TV3 political editor, TV presenter, Metro magazine editor and TVNZ head of news and current affairs.

It said Ralston’s evidence included that “the role of public interest journalism was driven by the public interest rather than the interests of the publisher. In this case, the communications between Ms Dixon and Ms Thompson prior to publishing the article suggested that ‘a primary driver here was self-interest, in terms of protecting Horse & Pony’s commercial position, rather than public interest’.”

It said that in Ralston’s opinion, “there have been significant failures at both the journalistic and editorial level in the preparation and publication of the article”.

The court said: “In Mr Ralston’s opinion, the authors ‘included what I understand is a serious criticism of the plaintiff’s professional conduct without taking basic steps to confirm the underlying facts, or seek comment from legal professionals on what [they perceived] to be the ‘very wrong’ and potentially unlawful conduct by Ms Cato’.”

The court said Manaia had sought to call several witnesses to respond to Ralston’s evidence, but this was not allowed by the judge for several reasons.

The court of appeal said whether a publication is of public interest is solely for the judge to determine. “Whether the publication is responsible is also determined by the judge but on the relevant primary facts as found by the jury.”

With the exception of one defence witness, the judge was not wrong to exclude them.

“However, the end result was that the jury heard the evidence of Mr Ralston and from two of the complainants but did not hear the somewhat counterbalancing evidence of any of the witnesses that Horse & Pony intended to call, who would have provided more context as to the circumstances in which it published the article.”

Conclusion

The Court of Appeal allowed the appeal and ordered a retrial.

“In summary, we consider the jury’s verdicts on whether the pleaded meanings were established must be set aside,” it said.

“In reaching those verdicts, the jury heard evidence from Mr Ralston that was irrelevant to their task and unfairly prejudicial.

“Defence evidence that might have provided some balance to Mr Ralston’s evidence was ruled inadmissible. And the jury was not directed to ignore Mr Ralston’s evidence because it was irrelevant to their task.

“Additionally, the jury heard repeatedly that this court had ruled that the article was capable of bearing the pleaded meanings. This gave rise to the risk that the jury’s verdicts on the pleaded meanings were tainted by hearing the court’s views on meaning.

“The risk of a substantial miscarriage arose as this was not a case where it was obvious that the article bore all the pleaded meanings.”

The Court of Appeal stated that $225,000 in general and aggravated damages was “significantly out of kilter” with other examples.

“While a wide margin is allowed to the jury, an award of this size has a chilling effect on publishers, particularly a niche one as here with a relatively small readership, that is disproportionate to the harm caused.

“Had we rejected all other grounds of appeal, we would nevertheless have set aside the award. The parties advised that they consented to this court substituting an award, after the opportunity for submissions, if that was the view we reached.

“It is not necessary to seek those submissions given our conclusion that the verdicts must be set aside. With the caveat that we have not had the benefit of submissions, but in case it is of assistance to the parties as to the way forward from here, we can indicate that an award of something in the order of $75,000 would not be unreasonable.”

The High Court jury also awarded punitive damages of $25,000. “We therefore would have set aside the punitive damages award had we dismissed the other grounds of appeal.”

Editor-at-Large Shayne Currie is one of New Zealand’s most experienced senior journalists and media leaders. He has held executive and senior editorial roles at NZME including Managing Editor, NZ Herald Editor and Herald on Sunday Editor and has a small shareholding in NZME.

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