NRMA LITIGATION

 

In July 2000, at the completion of an eighteen-month process, the NRMA Group was reorganized with more than 82% of members voting to split the Group in two. As a result:

  • NRMA Insurance Limited was demutualized and listed as NRMA Insurance Group Limited (now known as IAG, of which Mr Whitlam was chairman); and 
  • National Roads & Motorists’ Association Limited (‘the NRMA”, where Mr Whitlam was President or chairman) was recapitalized and continued as a mutual.

Mr Whitlam was an advocate of the reorganization, which was bitterly opposed by a vocal minority. 

Prior to the demutualization of NRMA Insurance, opponents of that proposal initiated legal proceedings to prevent it. During the demutalization process itself, Mr Whitlam had become the target of elements of the print media. These attacks intensified post demutualization, and extended to television and radio. 

As a result, Mr Whitlam initiated a number of defamation cases, each resolved to his satisfaction, although by late 2001 he was himself the subject of the notorious ASIC Proceedings: 

  • On 3 March 2001, former NRMA consultant Robert Dempsey made comments that were reported in the Fairfax print media. Mr Whitlam immediately sued Dempsey, and in January 2002 a jury found those comments to be defamatory of Mr Whitlam. In August 2004, Mr Dempsey agreed to pay Mr Whitlam a substantial amount in settlement of the proceedings and made an apology to him in which Dempsey accepted that his comments were made "without foundation". 
  • Journalist John Lyons created an interview with Mr Whitlam that was broadcast nationwide on the Nine Network’sSunday program on 11 March 2001. Mr Whitlam sued Lyons and Channel Nine for defamation. Gerald Stone, a former Nine executive producer, devotes a chapter to the Lyons “interview” in Who Killed Channel 9? (Macmillan, 2007); he describes it as “one of the worst examples of unfair reporting that I have seen in my 25 years in television.” In February 2007 the proceedings were settled on confidential terms. 
  • On 13 March 2001 Lyons was interviewed by Graham Richardson on Radio Station 2GB. Mr Whitlam immediately sued 2GB for defamation. In February 2002, a jury found that Mr Whitlam had been defamed. In May 2002 the matter was settled when 2GB made a substantial payment to Mr Whitlam and gave an apology in which it stated that 2GB "should not be taken to support any allegations, statements or innuendo made by the Sunday program broadcast by Channel Nine..." 
  • On 6 September 2001, prior to the resolution of these defamation matters, the Australian Securities and Investments Commission (“ASIC”) took proceedings against Mr Whitlam, alleging breaches of his director’s duties. The proceedings were dismissed, with costs against ASIC, in July 2003. 
  • When Mr Whitlam resigned from the IAG board in April 2001, that board denied him his retirement entitlements. He successfully sued IAG for those entitlements, with the NSW Supreme Court finding in February 2005 the IAG board to have behaved “unconscionably”. The case and its context are summarized in the Daily Telegraph article “The final judgment on NRMA plotters” of 8 March 2005.