Legal Analysis: Cheng v Lok [2020] SASC 14

In October 2018, a one-star review appeared on the Google My Business listing of Adelaide barrister Gordon Cheng. Written in English and Chinese, it warned people to stay away from him. It attacked his professionalism, accused him of giving misleading advice, and suggested that he pushed clients into court cases they could not win.

There was one fundamental problem. Cheng had never met the reviewer, Isabel Lok, and had never acted for her.

The review appeared among numerous five-star reviews of Cheng's practice. Its reach was substantial. The evidence before the Supreme Court of South Australia showed that, during one two-month period, the review was viewed more than 1,500 times. Judge Bochner observed that it may have received still more views closer to the time of its original publication.

That mattered because Cheng's practice depended heavily on reputation and word of mouth, particularly within Adelaide's Chinese community. By February 2019, he said his practice had suffered dramatically and approximately 80 per cent of his clients had left. A former client telephoned him that month and drew his attention to the review.

Cheng served a concerns notice in March 2019. Instead of resolving matters, the online activity continued. The name associated with the original review was changed from Isabel Lok to "Bel" and later to "Cindy." Another review appeared using the name "Peter," Lok's father, although he confirmed that he had not written it. A further review appeared under "JYL." The actual order was: Isabel → Bel → Peter review → Cindy (name change) → JYL. One of the later publications attempted to answer Cheng's assertion that he had never acted for Lok by claiming that his records must therefore be incomplete.

Cheng maintained that he had never met her.

The consequences, on his evidence, were severe. An accountant assessed the total economic damage, including loss of goodwill, at more than $900,000, although the court ultimately allowed substantially less after taking contingencies into account. Cheng also gave evidence that he had become intensely anxious, repeatedly checking his computer to see whether further attacks had appeared. He was diagnosed with depression and prescribed antidepressant medication.

Judge Bochner accepted the evidence of Cheng's distress and anxiety, although she was careful about medical causation. Because there was no medical report establishing the necessary causal connection, the court did not conclusively find that the diagnosed depression had been directly and predominantly caused by the defamatory publications.

Lok did not defend the proceedings and default judgment was entered. The subsequent hearing before Judge Bochner was therefore an assessment of damages rather than a defended trial of whether Lok could establish truth, honest opinion or some other defence.

The damages were nevertheless formidable.

Cheng received $300,000 for past economic loss, $100,000 for future economic loss and $150,000 for loss of goodwill. Another $100,000 was awarded as general damages for injury to reputation and distress, together with $100,000 aggravated damages. The total was therefore $750,000, plus costs on an indemnity basis.

The aggravated damages are particularly important. Judge Bochner considered that the only available conclusion was that Lok was "acting in the absence of bona fides" and that "no other finding is open" given the parties had never met. (At [59], [61]) Her conduct did not end when Cheng complained. Names were changed, further material appeared, there was no apology or offer to make amends, and there was conduct associated with avoiding service of the proceedings.

That is the case as it was actually decided: not merely an unhappy client giving a lawyer a savage review, but a person who had never been Cheng's client presenting herself as though she possessed personal experience of his professional services and persisting after being put on notice.

That raises the more interesting question. What if the reviewer really had been a client?

The answer under South Australian defamation law is that being a former client is certainly relevant, but it is not a licence to publish whatever one likes. The crucial questions remain what was said, whether the defamatory imputations are substantially true, and whether statements presented as opinion satisfy the statutory requirements for honest opinion.

Truth, or justification, is a complete defence under the Defamation Act 2005 (SA) where the defendant proves that the defamatory imputations are substantially true. A former client who accurately describes what happened has an obvious advantage that Lok did not possess. If a lawyer gave particular advice, charged a particular amount, recommended particular litigation or made particular statements, a client who can prove those matters may have the factual foundation for a defence.

The danger begins when dissatisfaction becomes invention or exaggeration. There is a significant difference between saying, "In my experience, the advice was poor and I regretted following it," and asserting supposedly objective facts that cannot be proved. A genuine client might possess abundant evidence supporting criticism of a lawyer while still defaming the lawyer by adding allegations of dishonesty, misconduct or events that never occurred.

Contextual truth may also be relevant. Broadly speaking, where a publication contains substantially true defamatory imputations that do the real reputational damage, additional imputations may sometimes be defended where they do not further harm the plaintiff's reputation. But again, the fact that some complaints are true does not automatically immunise everything else in the review.

The other important defence is honest opinion under section 29 of the Defamation Act 2005 (SA). The defamatory material must be opinion rather than an assertion of fact, the opinion must relate to a matter of public interest, and it must be based upon proper material. Proper material must itself satisfy statutory requirements, including being substantially true or otherwise protected.

The distinction between fact and opinion is therefore crucial. "I thought his advice was terrible" is recognisably evaluative. "He deliberately lied to me about the law" contains a factual allegation that may require proof. Putting "in my opinion" in front of an accusation does not necessarily transform a factual allegation into protected opinion.

There is also an important qualification concerning what is sometimes loosely called "malice." Under section 29, the precise statutory question concerning the defendant's own opinion is whether the opinion was honestly held at the time of publication. It is therefore too broad simply to say that any improper motive automatically destroys the honest-opinion defence.

Conduct surrounding publication can nevertheless be powerful evidence. If a reviewer changes identities, republishes allegations after receiving a concerns notice, invents additional events, recruits false identities or continues attacking the plaintiff after material has been removed, a court may consider that conduct when deciding whether a purported opinion was genuinely and honestly held. Such behaviour may also become highly significant when aggravated damages are considered.

That distinction helps explain why Cheng v Lok was so serious. Lok did not merely express an intemperate opinion about services she had actually received. The foundation of the supposed consumer experience was itself false.

Qualified privilege provides no general escape route for online reviewers either. South Australian law does not create a blanket privilege allowing a dissatisfied customer or client to publish anything about a professional to the entire internet. The statutory requirements must still be satisfied, including requirements concerning the recipient's interest in receiving the information and the reasonableness of the defendant's conduct in publishing it.

There is one further qualification when applying Cheng today. South Australian defamation law has changed since the events litigated in the case. Contemporary plaintiffs must satisfy the statutory serious-harm requirement. Cheng should therefore not be treated as establishing that every false one-star review automatically produces an actionable defamation claim. On the extraordinary facts of Cheng, however, serious reputational and economic harm was hardly theoretical: the court accepted evidence of a catastrophic decline in the plaintiff's practice.

The lesson from Cheng v Lok is consequently narrower, but more useful, than the proposition that negative Google reviews are dangerous.

A real former client begins in a very different position from Lok because the client has an actual experience upon which criticism may legitimately be based. Truthful facts can be defended. Genuine opinions based upon proper material may be protected. Robust criticism of professional services is not automatically defamatory merely because it damages the professional's feelings or reputation.

But the protection extends only as far as the available defences extend. Being a client does not make false facts true. Calling an accusation an "opinion" does not necessarily make it opinion. And having one legitimate grievance does not provide legal protection for invented allegations added to it.

Cheng v Lok is an extreme illustration of what happens when that boundary is crossed. A one-star Google review ultimately became a $750,000 judgment, plus indemnity costs, because what purported to be a consumer's account of professional services was, on the case before the court, an experience that had never occurred at all.

https://ia.acs.org.au/article/2020/lawyer-wins--750-000-over-bad-google-review.html