A bank that wrongfully dishonours cheques and communicates that dishonour to payees or collecting banks is protected by qualified privilege, even though the occasion for the communication was created by the bank's own error. The approach in Davidson v Barclays Bank should not be followed in New South Wales. The defence of qualified privilege is properly pleaded by alleging that the matter complained of (not the imputation) was published under qualified privilege. Contract damages for wrongful dishonour should be assessed on the same mitigation period as defamation damages absent a justified reason for differentiation.
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