The thing that really irks Bruce Robertson is not just that the giant power companies are threatening to sue him but that their lawyers are demanding he pay for their costs.
“It was a service I never requested,” quips Robertson, who has had to resort to black humour since the letter from Grid Australia arrived out of the blue last week.
In the quintessential act of corporate bullying, the nation’s electricity transmission giants are threatening to sue the corporate-analyst-turned-cattle-farmer from the mid-north coast of NSW.
Robertson has been a constant thorn in their side this year, revealing how the industry’s ‘gold-plating’, dodgy forecasts and misleading rhetoric have been the main factors behind the nose-bleed rise in power bills.
And so Grid Australia, the peak body for the transmission giants, is trying to muzzle him with legal threats.
This story is not just about power companies gagging an outspoken critic. It is about governments too. Grid Australia’s members are mostly state-owned power companies. They speak for $10 billion in network assets and they don’t like Robertson accusing them of gold-plating one little bit.
Here’s the catch. Governments are not allowed to sue their citizens (this is a good thing).
Nor are the other two members of Grid: Victoria’s SP-Ausnet, which is controlled by a Singaporean multinational, or South Australia’s transmission provider, ElectraNet, which is a consortium of powerful financiers. Both are too big to sue.
Under reforms to the defamation laws seven years ago, big companies are no longer permitted to sue (Section 9 Defamation Act, 2005). The intention of these reforms was precisely to stop this sort of intimidation by large vested interests.
They were designed to prevent large corporations from using the law for commercial purposes – to shut down bad press, among other things.
Justifying the threats
So how can Grid Australia get away with its threats to sue Bruce Robertson?
For the past week, BusinessDay has made repeated requests of Grid Australia’s law firm Ashurst to justify its action on legal and ethical grounds. Repeated requests for an explanation have been ignored. Not even a ‘no comment’ has been forthcoming.
Was Ashurst, one of Australia’s ‘big six’ legal firms, happy for Robertson and his family to lose their farm for the sake of making a fee? No answer.
As governments can’t sue for defamation, and big companies can’t sue either, we can only assume that Ashurst has deemed Grid Australia to be a small ‘not-for-profit’ entity with less than ten employees.
This highly contestable and technical conclusion might allow them to skirt around the law – the letter of the law that is. Clearly as a front for the power companies, the action shatters the spirit of the law. But Grid Australia’s action rests on shakier ground than black letter law.
It doesn’t even appear to be a legal entity for a start. And it has to be a legal entity to sue.
According to ASIC searches, Grid Australia is not an incorporated body. Nor does it have a business name. Nor does it seem to be an incorporated association under the Associations Incorporation Act.
The website does not list a board. The contacts for Grid Australia all appear to be Transgrid employees. And the website was registered by a Queensland Electricity Transmission Corporation, not Grid Australia.
Departing from the legal aspects for a moment to deliver a layman’s observation: Grid Australia is as much of a secret society, controlled by state government agencies, as it is a proper legal entity with a right to sue people for exercising their rights to free speech.
And so we have a front for Transgrid, spending a bundle of taxpayer dollars with a big-city law firm, in an effort to stop a farmer from having his say. And the taxpayers of Victoria and other states are also subsidising this ethically dubious exercise.
Already, Transgrid has spent taxpayer money securing the services of Sue Cato, often regarded as the most expensive crisis management consultant in the market, to assist with its reputational issues. Now it has resorted to lawyers.
BusinessDay has endeavoured for more than a week to contact the Ashurst staff involved in the action. We have also tried the PR department. Despite repeated requests for a response there was none forthcoming.
- On what legal grounds is Ashurst basing its threats? No answer.
- On what ethical grounds is Ashurst basing its threats? No answer.
- Was Ashurst happy for Robertson – a man of integrity and honesty – to lose his farm and his livelihood in the process of Ashurst making a fee? No answer.
The firm’s mission statement on Corporate Social Responsibility says:
Ashurst’s commitment to corporate social responsibility is core to all aspects of our global operations. This commitment means an approach to legal practice consistent with the highest professional and ethical standards; and it’s reflected in our dealings with our clients, our staff and the wider community. This commitment makes us a better law firm, a better employer and a better corporate citizen.
So with that in mind:
- Did this action on behalf of Grid Australia correspond with “the highest professional and ethical standards”? No answer.
- Did the failure of the firm to respond to questions indicate that the partners of Ashurst considered themselves above public scrutiny? No answer.
It would be interesting to know what the firm’s partners and 800 lawyers thought about this.
Lawyers enjoy a cherished place in society. The courts, where they ply their trade, are bankrolled by taxpayers to the tune of billions every year. Yet there is little effective regulation and oversight of the profession, let alone public scrutiny of this sort of intimidation.
If Ashurst reasonably knew the matters set out in its letter to Bruce Robertson were wrong and the threat of litigation was baseless (and we are not saying they did) then there may be an issue with rule 34.1 or 34.2 of the Revised Professional Conduct and Practice Rules 1995 (NSW).
A practitioner must not, in any communication with another person on behalf of a client:
34.1 represent to that person that anything is true which the practitioner knows, or reasonably believes, is untrue; or
34.2 make any statement that is calculated to mislead or intimidate the other person, and which grossly exceeds the legitimate assertion of the rights or entitlement of the practitioner’s client; or
34.3 threaten the institution of criminal proceedings against the other person in default of the person’s satisfying a concurrent civil liability to the practitioner’s client; or
34.4 demand the payment of any costs to the practitioner in the absence of any existing liability therefore owed by the person to the practitioner’s client.
Further, in order to commence proceedings in NSW, Ashurst would need to certify that there were reasonable prospects of success (pursuant to section 347 of the Legal Profession Act). If proceedings were commenced without reasonable prospects and were ultimately unsuccessful, the court could make an order for costs against the law firm itself.
It is the humble submission of this layman that Bruce Robertson ought to take the matter to the Legal Services Commissioner – even if the prospects of success are inevitably slim.
NOTE: As readers have pointed out there is a Grid Australia on the ASIC database. This entity is registered to an individual with an office in Elsternwick, Victoria. BusinessDay does not believe that this is the same entity working on behalf of the power companies. Efforts are being made to contact the individual.