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William Collins
19 May, 2010  
Murdoch's matey world

Guthrie v News Ltd. William Collins, Justinian’s veteran observer of Melbourne’s curial world, thinks Bruce Guthrie’s win against Harto and Blunders is on the margins of being a Pyrrhic one


imageEighty years ago, Baltimore’s own, the inimitable reporter and critic, Henry Louis Mencken (1880-1956 – pic), suggested that 90 percent of the intellectual steam of lawyers …

“was wasted upon causes and enterprises that live and perish with a day – that have, indeed, no genuine existence at all.”

And he was not at all impressed by what accounted for the remaining 10 percent.

Mencken was too busy condemning the practitioners of the “bull-ring of jurisprudence” and labelling lawyers as “brawling shysters” to devote time to what was motivating the folks who lined up at lawyers’ offices to press suit.

His fellow countryman and no less illustrious scribe, Ambrose Bierce (1842-1914), was supposed to have described a law suit as a machine which you entered as a pig and from which you emerged as a sausage.

Mencken was appallingly cruel in his treatment of our honourable profession. But that said, who would want to be a litigant?

In the Supreme Court of Victoria last Friday (May 14), Justice Stephen Kaye delivered judgment in Guthrie v News Ltd.

His Honour’s commendably swift resolution of the underlying dispute should provide an object lesson for lawyer and layperson alike concerning some of the pitfalls of litigation.

imageBruce Robert Guthrie (seen here), who for three decades had steadily scaled the heights of the antipodean outposts of the media empire presided over by K.R. Murdoch, the younger, had been appointed editor of Melbourne’s tabloid Herald Sun in February 2007 in succession to Peter Blunden who, continuing on his own upward corporate trajectory, had ascended to the position of deputy managing director of the News Ltd subsidiary, The Herald and Weekly Times Ltd.

Guthrie’s three-year contract had followed the imprimatur provided by News Ltd’s chairman and CEO, John Hartigan.

Hartigan’s name has only recently been used repeatedly in the media as part of the saturation coverage of the disgraced (News Ltd owned) Melbourne Storm Rugby League team.

Alas, almost from the outset, the Guthrie-Blunden working relationship was beset with “issues”.

There was a clash of “visions … values [and] ... goals” for the tabloid and, despite what the evidence revealed was the liberal reciprocal use of the word “mate” by the combatants, it all went from bad to worse to copious tears until Guthrie was fired by Hartigan on November 10, 2008.

Before that year was over, Guthrie had sued News Ltd for damages for breach of his contract of employment.

imageAt the trial, N.J. O’Bryan SC (pic) and J.B. McDougall appeared for the plaintiff and W.T. Houghton QC (News Ltd’s silk of choice in these parts) and R.H.M. Attiwill for the defendant.

The following excerpt from his Honour’s judgment culminates with a glimpse of the vernacular layering of the evidence given at the trial about the deteriorating atmosphere in the dealings between management and the editorial room:

“The plaintiff asked the reason for [his firing]. Mr Hartigan responded that he could not have a situation at the Herald Sun, one of the most important newspapers in the News Limited group, where the editor-in-chief and the managing director were not getting on.

The plaintiff responded that he thought that he and Blunden were getting on, to which Mr Hartigan replied, ‘That’s not what Peter Blunden has been telling me, he says he’s had to pull you up most weeks about the paper’.

The plaintiff stated that that was not true, and that he and Blunden were getting on ‘quite fine’.

Mr Hartigan, however, stated that the decision had been made. He then proceeded to state that he did not want Mr Guthrie to leave the company, and that he felt that he could find Mr Guthrie work in a magazine division or in The Australian in Sydney.

Mr Guthrie said that Sydney was not an acceptable proposition, because he had just purchased a house in Melbourne, he was selling his house in Sydney, and his eldest daughter was entering her final year of school.

He told Hartigan that the decision could not have come at a worse time for him.

To that Mr Hartigan responded, ‘I’m sorry, we’ve given you a real shit sandwich’.”

In this new age of active judicial case management and alternative dispute resolution, the settlement of cases is always a lurking presence.

It is an axiom, if not an iron law, of the irascible Mencken’s “bull-ring of jurisprudence”, that settlement is incomparably superior to combat. (Only the opposition’s grovelling capitulation is to be preferred.)

But, if pressed, most litigation lawyers would acknowledge that there is a small percentage of cases where the parties are intractable and settlement is out of the question.

As with everything else in the law, money, ego, and that ineffable marvel called “principle”, play central roles in these do-or-die cases.

During the trial Justice Kaye said that the prospect that he would have to resolve credit issues warranted particular consideration by the parties.

The litigants’ response was, however, a case of thanks, but no thanks, your Honour.

Lest anyone outside the tribal world of the law is tempted to think that the judge was putting his own convenience first, it has to be recorded that his Honour is a most attentive, diligent and industrious judge.

imageHis magisterial 91-page judgment will add to the existing body of enduring evidence of that.

Justice Kaye’s findings about the creditworthiness of Blunden’s and Hartigan’s (pic) evidence are very unflattering, but they are couched in the measured judicial terms that lawyers familiar with litigation see frequently, specially when the warring parties are at odds about the content and context of “one-on-one” conversations.

Any story about protean struggles within the inner sanctum of the mass media will be lapped up by the competitors.

Given the newsworthiness of News Ltd-related sporting events in Yarraside in recent times, Guthrie v News Ltd was a sugar-coated gift for that broadsheet paragon of Fourth Estate virtue, The Age.

We are, of course, always so much wiser after a superior court judge sets out in detail why victory went to the plaintiff or the defendant.

So it is easy now to ask: why, when the factual and legal issues of the case were (relatively speaking) straightforward, did the parties in Guthrie v News Ltd not, long ago, take a pragmatic, commercially realistic approach, do a confidential deal, and, having achieved litigious “closure”, “move on”?

In a feat of remarkably calculated minimalist law reporting, The Weekend Australian managed to report the outcome of the case without notifying its readers of the severe caning which Justice Kaye administered to Messrs Blunden and Hartigan for their evidence.

In very economical, almost Aesopian, language, the paper suggested that, given how the case had evolved, the victorious plaintiff had not really fared so well.

The $580,808 for reasonable notice damages (to which will be added interest and costs), that Justice Kaye awarded to the plaintiff is a stupendous amount of money when set alongside the five-figure sums taken home to their far-flung suburban bungalows each year by the average wage-slaves who read the Herald Sun.

Yet, despite all the pre and post judgment gloating over at The Age at the revelation of the unseemly inner workings of News Ltd, the ordinary reasonable “customer” on Metro’s 6.15 pm train to Mooroolbark could be forgiven for concluding that The Weekend Australian had a point and that Guthrie’s win was on the margins of being a Pyrrhic one.

For his part, the plaintiff vouchsafed to readers of The Age that he was taking Justice Kaye’s dismissal of his $2.765 million loss of opportunity damages claim in his stride.

Mr Guthrie revealed a quasi-Franciscan side to his make-up in his front-page declaration:

“Outside court, Mr Guthrie said the case was ‘never about money, per se. It was about vindication,’ he said, ‘and I think that’s what’s happened today’.”

Last week also brought the announcement that directors of the Melbourne Storm had issued proceedings in the Supreme Court of Victoria seeking redress for the NRL’s rustication of the club to the bottom of the 2010 NRL table of winners and losers.

Accuse me of insensitivity if you will, but the vibe from my viscera is that the folks at The Age will be hoping that no amount of effort will stop this case from proceeding to judgment.

READ ACTION-PACKED TRIAL TRANSCRIPT FROM GUTHRIE v NEWS LTD