Former Fairfax journalist John Garnaut says Chinese-Australian businessman Chau Chak Wing gifted him more than $10,000 worth of French wine, a gift which he feared could become a “reciprocity trap”, the Federal Court has heard.
Mr Chau is suing Mr Garnaut and Fairfax Media for defamation over an article published online in October 2015, which Mr Chau claims damaged his reputation by imputing he bribed, or conspired to bribe a former UN official, imputed his behaviour warranted extradition and that he made his fortune from illicit payments to officials.
Mr Garnaut told the Federal Court today he first remembered meeting Mr Chau in 2009 when he travelled to his resort in Guangzhou to interview him for a story.
He said after the interview he and his assistant were given six bottles of Chateau Latour burgundy from 1986 and 1994, which were later estimated to worth more than $1000 each.
Mr Garnaut said he regarded it as “reciprocity trap”.
“This was a major problem … if I took them I’d be under a heavy debt,” he said in court.
Mr Garnaut said Mr Chau also offered him flights, accommodation, a job, and for his family to come have a holiday at Mr Chau’s Imperial Springs resort.
“I thought he was offering to bring me into his web of … connections,” Mr Garnaut said.
Mr Garnaut said he was told Mr Chau was initially extremely nervous about the 2009 article, but then relaxed after being assured by a senior Australian politician that it was balanced, fair and the best he could expect from the Australian media.
He gave evidence that in July 2009, about a month after the initial meeting, that he and Mr Chau met for dinner in Beijing. Mr Garnaut said afterward he and his assistant were given another four bottles of Chateau Latour.
Mr Garnaut said all ten bottles were eventually auctioned off with the proceeds going to a charity near the Chinese border to help North Koreans.
On Tuesday, Mr Chau told the court he could not remember himself or an assistant giving Mr Garnaut bottles of wine.
Under cross examination, he said he had not been interviewed by Mr Garnaut when they met in 2009, but had just spoken to him out of politeness and not for more than ten minutes.
In its defence, Fairfax Media argues it was reasonable, in the circumstances, that the article was published for Dr Chau to be suspected of involvement in UN bribery.
The University of Sydney’s director of museums and cultural engagement told the court he received and made “a flurry of phone calls” after the article was published in October 2015.
“I was quite concerned … for the reputation of the university … I had a few sleepless nights,” David Ellis said.
A year earlier the university had approached Mr Chau offering to name a new museum after him.
Mr Ellis said the only favour requested from Mr Chau in return for the $15 million donation was that museum had a China gallery.
“It was one of the most generous gifts the university had received for capital works at that time,” he said.
Mr Ellis said after the article was published, benefactors of the new museum kept calling him wanting to know who Mr Chau was, if was he reputable, and why the university was naming the new museum “after such a person”.
He said he was worried the university would become embroiled in the scandal by association.
Mr Ellis said he did some investigating into Mr Chau before accepting the money.
“He struck me as being one of Australia’s most generous philanthropists … a quiet giver,” he said.
The former vice-chancellor of the University of Technology Sydney also gave evidence.
Emeritus Professor Ross Milbourne said he met Mr Garnaut in China and the reporter said to him words to the effect that since Mr Chau had donated $25 million to the university, it would be pressured to give the businessman’s son his degree.
“I thought it was an outrageous slur on my character,” Professor Milbourne said.
He said UTS “did a lot of due diligence” before accepting the $25 million donation.
Professor Milbourne said a lot of people in the circles he moved in knew Mr Chau and that he was “a very honourable man”.
The former vice-chancellor said the university council decided to name the building after Mr Chau, and that the businessman never asked for any favours or quid pro quos.
The hearing continues.