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Scenario: A Australian Legal Problem

On the basis of the following facts provided; advise Tom Burt:

  1. In respect of any action that he may be able to take and the prospects of success?
  2. Any potential liability he may face arising out of his own actions?

On 14 May 2018 Wally and Rita Shannon opened a new business called Café D’More. They had registered that name as a business name and the business was owned and operated using a private company of the same name i.e. Café D’More Pty Ltd.  Wally and Rita were the sole directors and shareholders of this company. The business was purchased from Tom Burt who operated as a sole trader under the business name Tom’s Café until he sold to the Shannons. The café was sold on a walk in walk out basis and so the furnishings, crockery, stock, and kitchen equipment was left for the Shannon’s. The full-time chef (Martina Lound) who works Tuesday to Saturday, the part time manager (Lucas Finn) who works Thursday - Saturday, and the 4 casual staff who work varied shifts will stay on with the new owners on the same terms as they were already on.

The finalisation for the sale went through on 4 May 2018 with Mr Burt handing over the keys and the café but staying on to provide a handover between 5 May 2018 and 12 May 2018, then to be available until 19 May 2018 by telephone for phone assistance. It just so happens that the day they took full control of the café after the handover period was finalised was actually Mother’s Day. So, the Shannon’s decided that they wanted to hold an opening celebration and decided to provide a Sunday opening on Mother’s Day for Café D’More. Part of the opening promotion was to provide all mother’s, who attended, a lovely bunch of flowers and a dainty box containing locally made fudge. Both the fudge and the flowers were supplied by Sally White the owner of Sweet Bulbs next door to the café. The opening was promoted by Café D’More through Instagram and Facebook for the week prior during the handover period and the interest seemed positive with 60 of the 80 seat capacity already booked by the Saturday before the big day with the rest expected to fill on the day. The Shannon’s were very excited and had made arrangements with Martina and Lucas for them to work at the opening as overtime that week and with the other casual staff also to be rostered on to work.

Mr Burt was quite excited as well to be heading off to start his retirement and as a thank you for their service and just generally to celebrate on the last day of the handover he invited all of Tom’s Café staff to a party at Culture Forks the restaurant opposite the cafe. They all attended and partied the night away with Mr Burt covering the full bill for food and drinks, what a night that was! Turns out Martina has quite the skill for table dancing, or at least she did until she fell breaking her arm. Apparently, a hospital emergency ward is not the best place when drunk either so Martina starts posting on her Facebook account including saying how the new owners of Café D’More new nothing about running a Cafe. Then Lucas decided to walk home from the restaurant as he did intend sharing a cab ride with Martina but that obviously couldn’t happen. On his walk home Lucas became tired and decided to have a sleep under a cosy looking tree.

Facts

Oblivious to the previous night’s events the Shannon’s open bright and early Sunday morning at Café D’More to prepare for the Mother’s Day opening special from 8am. Customers start arriving on time and the vibe is fresh and positive but the Shannon’s are starting to get quite concerned as neither Martina nor Lucas have showed up yet. They try ringing them but get no answer. One of the casuals mentions some social posts they saw from the night before. Mr Shannon starts getting really angry but decides he needs to be back in the kitchen preparing the food. He had intended getting back into it over the following months but not the very first day. He had been a chef for 12 years before going into sales of herbs to restaurants. He starts preparing the benches ready to commence and then went to put the oven on to warm up only to find that it was not working. After spending some time trying to figure out why he went outside the back of the café and discovered that the gas bottles had been removed. He also went to the cupboard to find that the pantry and realised that the stock was gone and so was were the plate collection and the more he looked the more was he thought was missing.

He came out to Mrs Shannon and in a voice loud enough for nearby customers to hear ‘I think we have been robbed’. Those customers then took to social media saying what they heard. One of the people who saw it is a local police officer and so they decided to come down and see if they could be of assistance. By now Mrs Shannon could see customers getting frustrated with the lack of service and was about to go and see what they could do when Sergeant Rob Egan entered asking about the robbery which he had heard about. A local news crew were stopping in for a coffee before attending another news story when they overheard Sergeant Egan talking about a robbery. Customers at a table of four under the name of Harper stood up loudly and stormed out shouting that they wouldn’t be back as the new owners had ripped the previous owner off and it was obviously true that they had no idea how to run a café as they couldn’t even serve toast.  About 40 people then slowly started to get up and leave as well. Mrs Shannon felt terrible, they had put everything into purchasing this café and couldn’t believe what was happening. So she put her arm around a couple from the Birch family trying to get them to stay but they demanded Mrs Shannon back off and leave them alone.

Mrs Shannon decided to get the flower and fudge gifts out to the remaining tables and these were well received by those customers who appeared understanding. About then Lucas stumbled in looking like he had no sleep and definitely was not presentable. He received a stern look from Sergeant Egan and it was at this point Mrs Shannon realised that a news camera seemed to be recording the whole incident. Mr Shannon meanwhile has been frantically trying to get Mr Burt on the telephone to see if he know’s what has happened to all the gear, but the number just rings out. With no real alternative the Shannon’s make the decision to close up for the day, knowing that they are going to have to get new equipment and supplies Monday to get back on their feet and then see if they can sort out what has happened.

When the Shannon’s get home they collapse on their couch wondering what they have got themselves into. It is then that Mrs Shannon listens to a message on her mobile it is from Martina saying she is out of action and on sick leave for the next 3 months while her arm recovers. The Shannon’s look at each other thinking it can’t get any worse. Later that evening Mr Shannon picks up his phone and goes to put a post on apologising when he sees that the community Facebook page has several people complaining about the service, then he sees Martina had been posting last night from the hospital saying that ‘Mr Burt was so annoyed with the new owners he was going to make their first day miserable’. The post from Martina had been liked 231 times, shared 40 times including being shared by Lucas who added in his own comment about Mr Shannon not even being able to fire up the oven that morning, with this comment receiving 40 likes! Mr Shannon has had enough so he puts up a post stating that Mr Burt is a liar and a thief and had left the café high and dry sabotaging their first day and they are going to sue him.

You are required to provide an answer to a hypothetical factual scenario.

Scenario: A Australian Legal Problem

Whether Tom Burt can take any action against the Shannon’s for posting negative comments against him?

Defamation is considered as the action through which person spreads bad or wrong things about another person, and such spreaders cause harm to that person. A person can be defamed by spreading false things about that person to the third person. For the purpose of defaming any person, it is not necessary makes the false news by themselves. In other words, person can defame the person by repeating the words said by any other person.

Section 6 of the Defamation Act 2005 states that defamation is the tort under the common law, as per this tort, defamation is concerned in context of the protection of the reputation of the person. This tort is mainly divided into two parts that are slander and Libel. Slander includes the defaming someone orally and Libel focus on the written defamatory statements.

Any plaintiff, who suffered the injury or loss because of the tort of defamation committed by the defendant, can seek compensation in form of damages by the defendant. Defamation includes the communication in any form such as social media, news, letter, etc. by one person to another person.  

For the purpose of seeking damages from the defendant under tort of defamation, plaintiff must prove these three things:

Defamatory statement has been communicated to the third person, which means, statement must be communicated to the third party other than plaintiff.

Communication made by the defendant identified the plaintiff. In other words, plaintiff made the defamation statement clearly against the plaintiff.

Communication made by defendant must be defamatory in nature. in other words, if communication does not damage the reputation of the person then it cannot be considered as the defamation under tort law. It must be noted that, following are the ways through which defamation accusation can be arise in the communication:

  • By conducting natural and ordinary meaning of the words.
  • Any communication which results in false suggestions in context of person.
  • Any communication which results in true suggestions.

In case law Morgan v Odhams Press 1971, story was published by defendant in which defendant communicates that plaintiff involved in the kidnapping. In this case, court stated that statement made by defendant was wrong, and plaintiff can seek damages.

It must be noted that, State passed the uniform defamation laws and also the Act in 2005. These laws are effective from the date of 1st January 2006.

Currently, Court dealt with number of issues of defamation in context of the social media, and Courts of Australia shows the increasing willingness to give the significant damages to those plaintiffs who are defamed at social media. In the year 2016, NSW Court held that, Facebook post is defamatory in nature because it results in the doubts of a pedophile in the community.

Facts

This can be understood through case law Reid v Dukic [2016] ACTSC 344 in which Court stated that reputation was breached on social media and fall under the defamation law.

There are some defenses which can be used by the defendant against the accusation of defamation made by plaintiff, and these defenses are fair comment, truth or justification, qualified privilege, and other defenses.

In the present case, Tom Brut can file case under tort of defamation against the Shannon’s because they defame the reputation of Mr. Brut by posting “that Mr. Burt is a liar and a thief and had left the café high and dry sabotaging their first day and they are going to sue him”. This is considered as defamation because all the necessary element of defamation are present in this case:

Defamatory statement has been communicated to the third person, which means, statement must be communicated to the third party other than plaintiff. As comment is posted on Facebook, and number of people sees that comment. In Pullman v Hill 1891. In this case, court stated that plaintiff must prove that statement of defamation must be made to any other person. In other words, if that statement was only read by the plaintiff, as there was no publication of the statement then no defamation was made.

Communication made by the defendant identified the plaintiff. In other words, plaintiff made the defamation statement clearly against the plaintiff. Name of Mr. Burt is clearly stated in the comment posted by Shannon’s.

This can be understood through case law Hulton v Jones 1910. In this case, story written by publisher clearly identify the barrister, which means communication of defamation was made against the barrister.

Communication made by defendant must be defamatory in nature. In other words, if communication does not damage the reputation of the person then it cannot be considered as the defamation under tort law. In the present case, comment made by Shannon’s is defamatory in nature as it damages the reputation of Mr. Burt. This can be understood through case law Random House Pty Ltd v Abbott 1999. In this case, statement was published by the defendant which indicates that political parties was changed by two politicians after they indulged in physical relations with two females, and later one of the female married with the one politician. The presentation in this communication was false, as it reflects that each politician fails to comply with their political principles in exchange of their sexual favors. In this case, court allowed the damages to the plaintiff.

Issue

After considering the above facts, it can be said that, Shannon’s defame the reputation of Mr. Burt by posting negative comments.

Conclusion:

Therefore, Mr. Burt can file case under tort of defamation against the Shannon’s for posting the comment on Facebook.

Whether Mr. Tom Burt is liable to face any liability in context of his own actions?

Terms of the contract are considered as most important part of the contract, and it mainly determines the rights and liabilities of the parties enter into the contract. Terms are of two types that are express terms and implied terms. Express terms are defined as those terms which are clearly written in the contract, and on other side, implied terms are introduced by the common law or by statute.

It must be noted that, express terms are considered as those terms which are decided by the parties before entering into the contract. Generally, it is very easy to determine these terms because they are clearly written, but on other occasions it is less clear. For the purpose of creating a binding term, it is necessary for the parties to be promissory in nature. In other words, parties related to the contract must have intention to create legal relations with each other. Intention for this purpose is determined objectively.

In Ellul and Ellul v Oakes, (1972) 3 SASR 377, Supreme Court of South Australia, in which court stated that if statement was not the part of the contract then it was not the contractual statement. In this case, court further stated that if representation was made while negotiating the contract in context of inducing the other party to act upon it by signing the contract, then it can be considered as the prima facie ground to considered it as express term of the contract.

In the present case, while negotiating the contract, it is decided between the parties thatMr. Brut needs to be available till the date 19th May on telephone in context of providing any assistance required by the Shannon’s.

Later, when Shannon’s call Mr. Burt on the day of opening because of number of issues faced by them, his phone’s ring out and he fail to attend the call. At that time, Shannon’s required the assistance from Mr. Burt because of all the mess happened at the café.

It can be said that Mr. Brut breach the express term of the contract by not providing assistance to the Shannon’s when they required. This statement of availability is the terms which are decided by the parties before entering into the contract. This term is the binding term, and reflects that parties are promissory. Parties related to the contract have intention to create legal relations with each other.

It can be said that, express term of the contract is breached by Mr. Tom Brut.

Conclusion:

Therefore, Shannon’s can take action in context of breach of express term of the contract against the Tom Brut.

References

Legal Vision, Elements of Defamation, <https://legalvision.com.au/defamation/>.

Lavan, 2017, Going viral: social media defamation cases on the rise, <https://www.lavan.com.au/advice/commercial_corporate_litigation/going-viral-social-media-defamation-cases-on-the-rise>.

Law Vision, Law of torts, <https://www.lawvision.com.au/uploads/PDFs/Tort%20Law%20.pdf>.

ACL, Terms of a contract, <https://www.australiancontractlaw.com/law/scope-terms.html#express>.

Morgan v Odhams Press 1971.

Reid v Dukic [2016] ACTSC 344.

Pullman v Hill 1891.

Hulton v Jones 1910.

Random House Pty Ltd v Abbott 1999.

Ellul and Ellul v Oakes, (1972) 3 SASR 377, Supreme Court of South Australia.

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My Assignment Help. (2020). Legal Advice On Defamation And Responsibility For Negative Comments On Social Media. Retrieved from https://myassignmenthelp.com/free-samples/blo1105-business-law/case-under-tort-of-defamation-against-the-shannon.html.

"Legal Advice On Defamation And Responsibility For Negative Comments On Social Media." My Assignment Help, 2020, https://myassignmenthelp.com/free-samples/blo1105-business-law/case-under-tort-of-defamation-against-the-shannon.html.

My Assignment Help (2020) Legal Advice On Defamation And Responsibility For Negative Comments On Social Media [Online]. Available from: https://myassignmenthelp.com/free-samples/blo1105-business-law/case-under-tort-of-defamation-against-the-shannon.html
[Accessed 23 July 2024].

My Assignment Help. 'Legal Advice On Defamation And Responsibility For Negative Comments On Social Media' (My Assignment Help, 2020) <https://myassignmenthelp.com/free-samples/blo1105-business-law/case-under-tort-of-defamation-against-the-shannon.html> accessed 23 July 2024.

My Assignment Help. Legal Advice On Defamation And Responsibility For Negative Comments On Social Media [Internet]. My Assignment Help. 2020 [cited 23 July 2024]. Available from: https://myassignmenthelp.com/free-samples/blo1105-business-law/case-under-tort-of-defamation-against-the-shannon.html.

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