Case Notes ~ Defamation in Strata Communities
Strata Manager Ordered to Pay $35k for Defaming EC Member
READ v GITMAN [2023] NSWDC 330
The case arose from three emails sent by the Strata Manager (SM) to the Owners Corporation (OC) allegedly containing information pertinent to the forthcoming AGM. Read was a member of the Executive Committee (EC) who had been elected to the positions of Chairperson, Secretary and Treasurer. She uncovered a series of errors made by Gitman, the SM: he paid a plumbing invoice twice, failed to balance the books of the OC, put money into wrong accounts, entered into an insurance contract without consultation, and neglected to verify the credentials of a contractor carrying out work on one of the lots who turned out to be an unlicensed handyman.
The SM responded to Read’s concerns in two emails that he copied to all owners and managing agents of lots in the units plan in which he accused Read of incompetence, lying, making false accusations of criminal conduct against the SM, and wasting the SM’s time and the OC’s resources on these concerns. The third email was sent directly to all owners on the day of the AGM in which the SM rehashed and sought to explain away Read’s concerns and further concluded “I would find it nearly impossible to continue managing your building if [Read] is on the committee … Therefore, I request you attend tonight’s meeting and elect the new committee.”
The SM argued, firstly, that his statements were not defamatory; secondly, that there was no damage to reputation in the context of a neighbourhood dispute; and, thirdly, relying on the defence of qualified privilege, that the parties were in a relationship that gives rise to a moral, legal or ethical duty to make the statements and he was communicating information relevant to the management and administration of the OC.
The court found each of the imputations of wasting OC’s money by irresponsible conduct, falsely accusing a person of a criminal act, and lying about such matters were defamatory. The court considered both the language and the style used and found that capitalization and bold and underlined font suggested the communication was important and was designed to attract attention. The limited extent of the distribution did not mean the damage done to Read’s reputation was trifled.
Although the SM was able to establish the comments were made for the proper purpose of providing information to owners, the court found he knowingly made false statements with an improper motive, specifically, he made at least eight demonstrably false statements about Read with the intention of discrediting her to avoid challenges to his own incompetence. His “motive is clear evidence of malice which defeats the defence of common law qualified privilege in relation to each of the publications.”
The SM was ordered to pay Read compensatory and aggravated damages in the sum of $35,000.