Treasurer Joe Hockey's defamation win against Fairfax Media over posts on Twitter has highlighted the need for Australian law to evolve to deal with defamation on social media, legal experts say.

Mr Hockey was awarded $200,000 in damages on Tuesday after Justice Richard White found he had been defamed by two tweets from The Age's Twitter account along with Sydney Morning Herald advertising placards, all of which used the headline "Treasurer for Sale".

But Justice White found Mr Hockey was not defamed by newspaper articles which used the same headline, because the context of the articles made it clear Fairfax was not suggesting the federal treasurer was corrupt or took bribes.

The Age provided a link to one of the stories in its tweets. However, the judge concluded some users "may read the tweet without going further" and be left with the impression Mr Hockey had engaged in corrupt conduct.

Professor Andrew Kenyon, the director of the Centre for Media and Communications Law at Melbourne Law School, said: "I think there is a real scope for the law to develop.

"It wouldn't be so hard for the law to say, 'look, in the context of tweets, you actually take the full context of the article. It's enough to have that clear link.'"

On Tuesday, a long-running Twitter defamation battle between former federal Labor MP Mike Kelly and Liberal pollsters Lynton Crosby and Mark Textor ended after Dr Kelly apologised for a Tweet accusing the pair of "push polling".

Justice White noted in his judgment that Mr Hockey's legal team appeared to have pleaded "aspects of the one tweet" as separate publications.

It meant the $80,000 damages payout relating to Twitter was in fact for two parts of a single tweet, sent from The Age's Twitter account on May 4, 2014.

The first part was the words "Treasurer Hockey for Sale" which appeared with a link to a news article. The second part was a summary of that article in the same tweet, which appeared when users clicked "view summary".

Justice White found both the "bare tweet" and the summary defamed Mr Hockey by imputing corruption on his part.

He dismissed Mr Hockey's claim over a "third Twitter matter" which was a combination of the summary and the full text of the article because the imputation of corruption would have been "dispelled" by reading the full story.

Sydney barrister Matthew Lewis, an expert in defamation law, said that when the Defamation Act 2005 was enacted "Facebook and Twitter and any other social media platforms such as Instagram were mere glints in their creators' eyes".

"I think this decision, in combination with other recent decisions which don't necessarily hinge upon social media, indicate that the legislature should actually look at defamation law in Australia again," he said.

Professor David Weisbrot, chair of the Australian Press Council, said the decision pointed to the need for urgent law reform.

He pointed to the "public figure" doctrine in the US, which restricts the cases in which politicians can bring defamation actions to those in which actual malice - knowledge that claims are false, or recklessness - can be shown.

"Similarly, defamation law has been reformed in the UK to accord with modern notions of robust free speech and the critical role of the media in holding politicians and the rich and powerful to account," he said. "The Press Council would be happy to lead a reform process in this area."

Geoff Holland, a media law expert at the University of Technology, Sydney, said the decision was a warning to media outlets but the award of damages in this case was "not that great" given the $366,000 cap on general damages.

Financially it could be a "zero sum game" in light of the costs involved, he said.