Everyone was expecting a settlement this morning in Guthrie vs. News but if there was a six figure sum waiting in the wings no-one was letting on. Will Houghton, QC, for News, solemnly commenced his closing argument, recounting in methodical fashion dissenting legal precedents over the expectation of loss provision that forms the cornerstone of Guthrie’s case.

As we reported on Friday, there are some serious discrepancies in the evidence with Justice Stephen Kaye admitting that were he forced to make a judgement, he would inevitably blacken someone’s name by fingering one of the parties — either Guthrie, sparring partner Peter Blunden, or even News boss John Hartigan — as a liar.

This morning, Kaye remarked on Hartigan’s fairly vague recollections concerning a 2007 meeting with Guthrie in which he said Guthrie demanded a three year contract so he could dangle it in front of his wife, Age Good Food Guide scribe Janne Apelgren, as a pretext for returning to their Cremorne home once the gig in Melbourne was up.

Guthrie has denied the conversation ever took place, just as Blunden, giving evidence on Friday, issued an unequivocal rejection that he had ever talked to then-News chairwoman Janet Calvert-Jones about the infamous Beverly Hills Cop front page attacking former police chief Christine Nixon.

Norman O’Bryan, SC, for Guthrie, had accused Blunden of using the intervention of Calvert-Jones as a ruse for his own relentless campaign to dislodge Guthrie over the course of 2008 chiefly by complaining every few weeks to Hartigan, while remaining cordial in emails to Guthrie peppered with the word “mate”.

If Kaye is forced to make a judgement in the case, and that is expected to happen tomorrow as the closing arguments wind up, then there will be some serious blood on the floor as reputations are shredded.

By refusing to settle, News is apparently desperate to send a warning to never take on a $40 billion company in court and expect to emerge successful. Its core argument this morning remained that Guthrie has already been adequately compensated when his contract was paid out to the tune of $1.1 million and that another clause enabling its renegotiation after 30 months had, according to Houghton, no commercial value.

Houghton (who walked over to the assembled journos before the proceedings commenced and rebuked Herald Sun court reporter Norrie Ross for referring to him as an SC, rather than a QC, in print) was unequivocal, claiming that Guthrie had no right to a further three year term. The argument, he said, rested on the 2007 high court judgement in Sellars v. Adelaide Petroleum over loss of opportunity.

The proceedings were of a much lower register compared to the edgy performance on Friday afternoon from HWT chief, and Guthrie’s predecessor, Peter Blunden (see Stephen Mayne’s summary here).

The fidgety News lifer downed cups of water in the witness box, as O’Bryan got close to getting him to admit that he had lied under oath.

Guthrie’s strategy has been to paint Blunden as waging a deliberate, covert campaign throughout 2008 to oust him from his position.

This amazing exchange, over whether Blunden had told Guthrie he was travelling to Beijing for the Olympics as a guest of Australia Post, culminated in almost a minute of silence as Blunden considered his response:

MR O’BRYAN: Do you see in the second last line of your email sent at 7.16 p.m. on Tuesday, 12 August — have you got that one?

BLUNDEN: –Yes, I see it.

You say in the second last line, “For what it’s worth I told you directly that I was going to Beijing”?

B: —M’mm.

Now, you’ve given evidence on oath twice now today that you hadn’t told Guthrie that, so that was false wasn’t it, when you said that to Guthrie?

B: —My recollection that day would have been clearer than it is today I’m afraid, so

I’m sorry I can’t hear you?

B: —I have no recollection today of having had a conversation about Beijing with him.

Do you want to retract those two occasions today on which you said you had not discussed the trip to Beijing with Guthrie, do you want to change that evidence?

B: —Directly with Mr Guthrie, but I know he was aware I was there.

Do you want to change your evidence given twice today? Mr Blunden, that you had not discussed your trip to Beijing with Mr Guthrie? Do you want to change that evidence or not?

B: —I don’t recall the direct — a direct request — a direct acknowledgment to Mr Guthrie. I didn’t report my movements to him but I was aware when I left that he was aware I was going, but I did not report to him directly. But I know that Mr Guthrie questioned why I was there.

Mr Blunden I want to put it to you that there are at least three falsehoods in this email that you sent to Mr Guthrie on that occasion, that’s one of them. There are two other things that you said to him that are false. The other thing you said is what you said in the sixth line, “I have supported most of your initiatives”. Now, by August 2008 Mr Blunden you had been working assiduously for many, many months to undermine Mr Guthrie. You were doing the opposite of supporting him, you were digging away at his foundations as vigorously as you could, do you agree?

B: —No, I do not.

The other falsehood in this email you sent him was two lines down, “Other than that I have endeavoured to support you, despite you seemingly thinking otherwise”. That was also false, wasn’t it?

B: —I allowed him to make all the changes he wanted to for the paper. I supported his editorial initiatives with Extra.

You were lying to Mr Guthrie, I suggest to you Mr Blunden, at least three times in that one email of only or so sentences. Do you concede that?

B: —I did endeavour to support his changes to the paper, I did. I didn’t support him to Mr Hartigan. I allowed Mr Guthrie to make whatever changes he thought were appropriate to the paper, despite the fact that I didn’t agree with the direction.

I suggest to you Mr Blunden you were, by this time and you had been for many months, engaging in a deliberate deception of Mr Guthrie about the suggestion you were supporting him. You were doing the opposite, do you concede that?

B: —I supported him in every way, except with Mr Hartigan.

Closing arguments will continue this afternoon, with the court expected to hear from O’Bryan.

The final judgement, which sources close to the court say will be handed down this week, is tipped to be savage.