The Serious Harm Test in Defamation Claims

Since 2022, many Australian states and territories have modified their defamation laws to raise the bar for a defamation claim to succeed. To succeed with a defamation claim in any of these jurisdictions, the plaintiff now needs to demonstrate that the publication of the defamatory material has caused, or is likely to cause, significant harm to their reputation. This article discusses the serious harm test in defamation claims.

The serious harm test in defamation legislation

The serious harm test is contained in section 10A of the Defamation Acts of the states and territory that have adopted it. The judicial officer, rather than the jury, determines whether serious harm has been caused. This issue may be assessed before or during the trial.

Reasons for the introduction of the serious harm test in defamation claims

The serious harm test was created to address defamation lawsuits that arise in response to minor publications that do not cause significant harm and are not viewed, read or heard by a large number of people.

There has been an increase in these minor defamation claims in recent years, largely due to the extensive use of social media as well as the growing importance of Google and Facebook reviews. When negative remarks are posted on social media about a person or a company, or a negative review of a business is published, the amount of damages that may be awarded to the defamed party is deemed disproportionate to the cost of bringing proceedings.

Scott V Bodley and the serious harm test in defamation claims

Scott v Bodley was a defamation claim decided by the New South Wales District Court in 2022. In that matter, Dale Scott sued Bettina Bodley, after Bodley posted a one-star review of Scott’s painting business on Facebook and Google. Scott argued that the review led to significant harm to his reputation, a decline in his business, and a loss of income. The court, however, ruled that Scott had not shown serious harm to his reputation, as required by the serious harm test under section 10A of the Defamation Act 2005.

Background

Bodley and her husband asked Pottsville Painting Services to give them a quote for the internal and external painting of their house in 2021. The job was not up to their standards, and a review was posted. The review, which was public for two weeks, included pictures of the work and stated that the work had over 130 flaws and had caused harm to their property.

The imputations of the review were that Scott had behaved unprofessionally, incompetently, and dishonestly in carrying out the job, and had verbally abused Bodley.

Scott testified that he had been a painter for 27 years and worked mainly in the Pottsville region. He did not advertise but encouraged customers to leave reviews of his company. He claimed that customers had selected his company because of the positive online feedback. His business had previously held a Google rating of 5/5.

After Bodley’s review was posted, Scott claimed that he saw an immediate decline in calls and business. He tendered tax returns indicating a significant drop in earnings for the 2021 financial year relative to the previous two years. He stated that he went from receiving six to eight enquiries per week to just one or two, and that this situation persisted after the review was deleted.

Bodley disputed Scott’s testimony on various grounds, including that there was no evidence that any specific person was deterred by the review, or even that anyone read it. She argued that the data required to determine the sources of his loss was not provided, and that Scott had advertised for an apprentice during the period he claimed his business had shrunk.

The court’s findings

The court found discrepancies in the evidence of business loss and financial records that indicated the business was doing well. It also found that shifts in business patterns had not been explained and that Scoot was asking the court to infer that the reduction in business could be attributed to the reviews.

The court further found that it was probable that no one saw or read the reviews, as they were public for two weeks only. Scott could not name anyone who saw the reviews and relied on the inference that they were widely read. He did not adduce any evidence of the grapevine effect. Google reviews are well-known to be expressions of personal opinion and many business sites contain unflattering reviews.

Conclusion

The court found that Scott had failed to establish harm to his reputation, much less serious harm to his reputation, as now required under the Defamation Act 2005. Bodley’s reviews contained personal experience and opinion and the imputations against Scott were not serious. The court found that Scott’s claim was an example of a ‘backyard’ defamation action based on a trivial publication.

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