Defamation

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Defamation
This guide considers what a defamatory statement is under English law and the relevant defences and remedies. It also looks at the malicious publication of false statements. Topics covered include: Defamation Libel, slander or malicious falsehood? Transition to the Defamation Act 2013 What is "defamatory"? Can a company or other organisation be defamed? Publication Who can sue in defamation actions? Cross-border defamation Table: Defences to defamation issues arising What are the remedies for defamation? Future developments: statutory instruments and uncertainties with regard to costs Malicious falsehood How does it differ from defamation? Advantages and disadvantages Basic ingredients

This publication is not intended to be a comprehensive review of all developments in the law and practice, or to cover all aspects of those referred to. Readers should take legal advice before applying the information contained in this publication to specific issues or transactions. For more information please contact us at Ashurst LLP, Broadwalk House, 5 Appold Street, London EC2A 2HA T: +44 (0)20 7638 1111 F: +44 (0)20 7638 1112 www.ashurst.com Ashurst LLP and its affiliates operate under the name Ashurst. Ashurst LLP is a limited liability partnership registered in England and Wales under number OC330252. It is a law firm authorised and regulated by the Solicitors Regulation Authority of England and Wales under number 468653. The term "partner" is used to refer to a member of Ashurst LLP or to an employee or consultant with equivalent standing and qualifications or to an individual with equivalent status in one of Ashurst LLP's affiliates. Further details about Ashurst can be found at www.ashurst.com. Ashurst LLP 2013 Ref: 9091715 May 2013

Defamation

Defamation
1. Libel, slander or malicious falsehood?

Defamatory words published to a third party give rise to a cause of action for defamation. There are two types of defamation actions: libel and slander. Where publication is in writing or other permanent form the action is in libel. It includes radio and television broadcasts. Where publication is spoken or in some other temporary form, the action is in slander. To sue successfully for slander, financial loss or damage must be shown, except in certain circumstances. 1 It is unnecessary to show loss in a libel action. 2 Some harm arising from the publication of a libel is presumed. Malicious or injurious falsehood is a related but separate cause of action from defamation. It is described as an action "for damage wilfully and intentionally done without lawful occasion or excuse". 3 It is available where false statements are published maliciously causing harm. Malicious falsehood is dealt with in more detail at the end of this guide.

2.

Transition to the Defamation Act 2013

The Defamation Act 2013 (the 2013 Act) received Royal Assent on 25 April 2013. The new legislation will overhaul the existing rules with a view to striking a fairer balance between the right to freedom of expression and the protection of reputation. In practice, the 2013 Act codifies parts of the existing law and brings about a number of substantive changes aimed at deterring trivial claims and increasing or simplifying the number of defences available to defendants. The 2013 Act will come into force later in the year and will apply to causes of action which accrue after its commencement date. This means that the current regime will continue to apply to actions accruing before that time.

3.

What is "defamatory"?

Words are defamatory if they are likely to harm a person's reputation. If the words complained of are not "capable" of bearing the meaning alleged by the claimant or are not defamatory the court may strike out the claim 4 . There is no single definition, but the following are useful guides: "would the words tend to lower the plaintiff in the estimation of right-thinking members of society generally?"; 5 "A publication which is calculated to injure the reputation of another by exposing him to [public] hatred, contempt, or ridicule"; 6 "if it tends to make the plaintiff be shunned and avoided". 7

The 2013 Act introduces a "serious harm" threshold so that claimants will now have to show that they have suffered serious harm to their reputation 8 . The Explanatory Notes to the 2013 Act clarify that this requirement,

1 2 3 4

The most relevant to a commercial context being where the slander contains allegations calculated to disparage a person in any office, profession, calling, trade or business held or carried on by him at the time of publication. s. 2 Defamation Act 1996. Even in the case of a corporation: Jameel and others -v- Wall Street Journal Europe Sprl [2006] UKHL 44. Ratcliffe -v- Evans [1892] 2 QB 524. For example, in 1996 The Sunday Times tried unsuccessfully to persuade the court to strike out a claim by Stephen Berkoff over an allegation that he was hideously ugly: Berkoff -v- Burchill [1996] 4 All ER 1008, CA. PD 53.4.1 allows the court to determine the question of culpability at an early stage. Sim -v- Stretch [1936] 2 All ER 1237, HL. Parmiter -v- Coupland [1840] 6 M&W 105. Youssoupoff -v- Metro Goldwyn-Mayer Pictures Limited [1934] 50 TLR 581, CA. Defamation Act, 2013, s.1(1).

5 6 7 8

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which was influenced by a number of cases identifying a threshold of seriousness 9 , is aimed at dissuading trivial claims. The meaning of "serious harm" is not defined but suggests a higher threshold than "substantial harm" which was initially required in the draft Defamation Bill in 2011 10 . It will therefore be up to the courts to determine the seriousness of the harm in light of the individual circumstances of the case 11 .

3.

Can a company or other organisation be defamed?

12

A company can bring an action in respect of words that damage its trading reputation

. Officials of

unincorporated associations can bring personal actions but the unincorporated associations themselves cannot sue. Government departments (central or local) cannot sue for libel but individual councillors or officers may. 13 No libel claim can be brought by others on behalf of someone who has died (unlike actions for malicious falsehood see section at the end of this guide). Under the 2013 Act, harm to the reputation of a body that trades for profit is not "serious harm", and therefore not defamatory, unless it has caused or is likely to cause the body serious financial loss 14 . This substantial change will make it more difficult for companies to successfully sue for defamation 15 .

4.

Publication

Publication takes place whenever the defendant has communicated the defamatory matter to someone other than the person defamed. To be found liable, the defendant must be a primary or secondary publisher of the defamatory statement. A primary publisher is a person who exercises direct control over the published statement; this includes authors, editors and publishing houses 16 . A secondary publisher will not take an active editorial role but will still be liable if it makes the defamatory statement available to third parties. There is no need for a person to draw the attention of the third party specifically to the defamatory matter. It is enough if he makes the matter available in circumstances where he has reason to believe it will be read. The particular communicator of the defamatory matter will therefore be responsible for publication but liability will also extend to anyone who participates in, secures or authorises the libel. So, in the case of a newspaper libel, the journalist, editor, publishing company and, on occasion, even the printer can be sued 17 ; in the case of an online publication, the owner of the website or the Internet Service Provider (ISP) could equally be sued 18 . The Civil Liability Act 1978 allows the court to apportion damages between the various parties who are responsible for the publication of the defamatory material. Under the 2013 Act, a court will not have jurisdiction to hear or determine an action brought against a person who is not the author, editor or publisher unless it is satisfied that it is not reasonably practicable for an action to be brought against the author, editor or publisher 19 . This reinforces the distinction between primary and secondary publishers and is aimed at reducing the number of actions against intermediaries, such as ISPs or social media platforms, which have multiplied over the last years 20 .

10 11 12 13 14 15

Explanatory notes to the Defamation Act 2013, s.11. The explanatory notes refer in particular to Thornton -v- Telegraph Media Group Ltd [2010] EWHC 1414, which identifies a decision of the House of Lord in Sim- v- Stretch [1936] 2 All ER 1237 and Jameel (Youssef) v- Dow Jones & Co Inc [2005] QB 946, as authorities for the existence of a requirement of seriousness. And which was already referred to in Thornton -v- Telegraph Media Group Ltd. Defamation Bill Committee Stage Report, Bill No 51 2012-13, Research Paper 12/49, 31 August 2012. Jameel and others -v- Wall Street Journal Europe Sprl [2006] UKHL 44. Derbyshire CC -v- Times Newspapers Ltd [1993] AC 534, HL. Defamation Act 2013, s.1(2). This change also confirms a trend in case law where some courts have tried to make it harder for corporations to sue in defamation. For instance in Collins Stewart Ltd & Another v- Financial Times Ltd ([2004] EWHC 2337 QBD), the High Court held that alleging a shortfall in the market capitalisation of a company as a suggested measure of damages was far too uncertain to be acceptable as a legal basis for assessing damages. If followed and applied to the 2013 Act, this decision could also suggest that companies could not refer to a fall in share price to show that they suffered serious financial losses. Defamation Act 1996, s.1(2). But see the defence of "innocent dissemination" below. Godfrey -v- Demon Internet Ltd [1999] EWHC QB 244. Defamation Act 2013, s.10. Also see below for the new defence provided to website operators who promptly remove defamatory content following receipt of a sufficient notice (Defamation Act 2013, s.5).

16 17 18 19 20

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5.

Who can sue in defamation actions?

An action for defamation is a purely personal action. The claimant must be the person who has been directly and personally defamed. A class of persons cannot be defamed as a class, nor can an individual be defamed by a mere general reference to the class to which he belongs; but a person or persons may bring a claim if he is or they are pointed to by the words complained of. The test is whether the defamatory statement is capable of being understood as referring to the claimant. The publisher's intention is irrelevant. Accordingly, it is by no means fatal to a claim that the claimant is not mentioned by name. Using a nickname, describing physical characteristics or some "peg or pointer" leading people to identify him as the person defamed is sufficient. Where words refer to a body or class of people, there will be no cause of action unless the class is sufficiently small that the words can reasonably be understood as referring to the individuals in that class. "All plumbers are crooks" is not defamatory but it may be defamatory to say that all plumbers from a specific company are crooks.

6.

Cross-border defamation and "libel tourism"

The European Court of Justice has ruled that the victim of a defamatory statement published in several Brussels Convention States may recover damages either in the jurisdiction where the publisher was established, or before each of the courts where the defamatory publication was distributed and where the victim had suffered harm to his reputation. 21 (The Brussels Convention has since been largely superseded by EC Regulation 44/2001 22 but there are equivalent provisions in the Regulation.) This means that where a person is libelled in a foreign newspaper but with a circulation in England, he may commence proceedings in the Contracting State of the publishing company or in England (although his damage will be limited to the circulation in this country). The claimant may only recover for damage suffered in any other jurisdiction if the laws of that country permit. 23 Claimants may still choose the English courts where the allegations are published in many jurisdictions or on the internet. English courts have shown some reluctance (at least at first instance) to hear claims which in fact have little or no connection with the country. However, in Berezovsky -v- Forbes Inc, 24 the House of Lords ruled that a Russian businessman who was based primarily abroad could sue a US publication in the English courts even though only a thousand or so copies were circulated in England. This has created situations of "libel tourism" where wealthy foreign individuals sued in England of Wales despite the absence of clear connection to this jurisdiction - and has been widely criticised as an excessive limitation to freedom of speech. The 2013 Act attempts to address this issue when the defendant is not domiciled within the EU by requiring a tighter connection to England and Wales. The court will no longer have jurisdiction to decide on such claims unless it is satisfied that England and Wales is "clearly the most appropriate place" in which to bring the action 25 . Courts will be required to consider the global picture of a dispute to decide whether it would be more appropriate to hear the claim in another jurisdiction.

21 22 23 24 25

Shevill and Others -v- Presse Alliance SA [1995] 2 AC 18 ECJ; and see House of Lords' application of the ECJ decision [1996] AC 959. Regulation on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, applicable in all European countries except Denmark to which the Brussels Convention continues to apply. Shevill and Others -v- Presse Alliance SA ibid. [2000] 1 WLR 1004, HL. Defamation Act 2013, s.9(2).

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7.

Defences to defamation: issues and changes under the Defamation Act 2013
Issues Changes under the Defamation Act 2013

Defence

Limitation One year from the date on which the cause of action accrues. 26 The court may exclude this time limit if it considers it equitable to do so. 27

When does publication take place?

Single Publication Rule 29 The 2013 Act overturns Loutchansky -

In Loutchansky -v- The Times Newspapers 28 a Russian businessman brought two actions for libel concerning articles published describing him as a "suspected Mafia boss" involved in money laundering and smuggling nuclear weapons. The editions were then archived online and continued to be available to the public. Anyone consulting the archive would have been unaware that the accuracy of the articles had been disputed. Dr Loutchansky brought the second action in respect of the online archive after the one-year limitation period had expired. Refusing to follow the US single publication rule, i.e. that a newspaper is published only once at the time of the original publication, the Court of Appeal held that each individual publication of libel gives rise to a separate cause of action, subject to its own limitation period. Each hit on an online archive amounts to republication and the limitation period runs from the time the material is accessed.

v- The Times Newspapers and establishes a single publication rule which should prevent indefinite or extended liability for archives or online publications, including on the Internet. The limitation period in relation to subsequent publications of the same material by the same publisher will be treated as starting on the date of the first publication.

Innocent dissemination

Gives limited protection to those with technical, but not editorial, responsibility for

Operators of websites and secondary publishers 34

Certain persons including printers, distributors or retailers may escape liability if they can show they took reasonable care in relation to the publication and did not know, and had no reason to believe, that they caused or contributed to the

publications The defence of innocent dissemination Particularly relevant to live broadcasters and internet service providers whose role is limited to supplying access to the material. is not abolished by the 2013 Act. However, it will have to co-exist with a new defence which will apply to operators of website.

26 27 28 29

Defamation Act 1996, s.5 amends Limitation Act 1980, s.4A. Limitation Act 1980, s.32A. [2002] QB 783, CA. Defamation Act 2013, s.8.

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Defence

Issues

Changes under the Defamation Act 2013

publication of a defamatory statement. 30

However, in Godfrey -v- Demon Internet Limited 31 the court decided that an ISP could not avail itself of this defence where its service carried a defamatory message from an unknown third party. The complaint related not to the initial publication and transmission of the message, but the ISP's failure to remove the message once its false and defamatory nature had been made known to it. The judge held that the ISP had not taken reasonable care and therefore contributed to its continuing publication.

The operator of a website will have a defence in relation to a defamatory statement posted by a third party if: the claimant can identify the poster; or the operator has not received a notice of complaint 35 ; or the operator has received a notice of complaint and complies with regulations which require him to take down the post and/or provide the claimant with the identify of the poster 36 ; The defence is defeated if the claimant

By contrast in Payam Tamiz vGoogle Inc and another

32

shows that none of these apply or if the operator of the website acted with malice in relation to the posting of the statement concerned 37 . In addition, the court will not have jurisdiction against secondary publishers if an action can reasonably be brought against the author, editor or publisher 38 .

it was

held that Google's role as a platform provider was purely passive and this took it outside the definition of a publisher, even though the claimant had notified Google of the existence of the defamatory material. Liability for hyperlinks was addressed by the High Court in McGrath and another v- Dawkins and other 33 where it was held that the operator of a website could be liable for links to allegedly defamatory postings on a website even though the website itself carried no defamatory posting.

30 31 32 33 34 35 36 37 38

Defamation Act 1996, s.1. [2001] QB 201. [2012] EWHC 449 (QB). [2012] EWHC B3 (QB). Defamation Act 2013, s.5 and 10. See Defamation Act 2013, s.5 and 6. The notice of complaint will have to specify the complainant's name, the disputed statement, explain why it is defamatory, specify its location on the website and any other information which may be required in regulations implementing the 2013 Act. Defamation Act 2013, s.5(3). Further regulations are expected in the coming months to clarify the process that must be followed by operators when dealing with notices of complaint. Defamation Act 2013, s.5(11). Defamation Act 2013, s.10 as discussed above.

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Defence

Issues

Changes under the Defamation Act 2013

Offer of amends Where a publisher did not know, and had no reason to believe, that the offending words were defamatory of the claimant, or simply that they were false, the publisher may serve notice on the claimant offering to make a suitable apology and correction and to pay him damages. If the offer is rejected, the publisher will have a full defence to the action. If the offer is accepted, any terms which cannot be agreed between the parties will be determined by the court. 39 The defence has not proved popular as there is a perception that there is little control over the terms that may be imposed by the court. Justification Defendant must prove, on the balance of probability, that the words are true. The "repetition rule" If A says that B told him that C had been convicted of theft, it will be no defence for A to prove that B told him so; he must prove as a fact that C was convicted of theft. However, a defendant need prove only that the defamatory statement was "substantially" true, e.g. where it is stated that a person was sentenced to three weeks' imprisonment it will be sufficient justification to show that he was sentenced for a fortnight. In practice the line is sometimes difficult to draw. In essence, the new defence means that the defendant has a defence if he can show that the imputation conveyed by the statement is substantially true or that it did not seriously harm the claimant's reputation 41 . Honest Opinion 43 The defence of fair comment is abolished by the 2013 Act and replaced by this new defence. The defendant should show that the Malice means made with some indirect or improper motive or knowing the statement to be untrue, or with reckless The defendant must establish that: the subject matter was a matter of public interest; the expression of opinion was based on a true factual background;
39 40 41 42 43

No change.

Defence of Truth 40 The defence of justification is formally abolished by the 2013 Act and replaced by this new defence. However in practice, the 2013 Act seem to endorse the existing case law on the defence of justification and it is therefore likely that similar legal principles will continue to apply.

Fair comment Fair comment made in good faith and without malice on a matter of public interest is a defence to a claim for defamation. It protects the expression of honestly held opinions on matters of public concern.

Defeated by proving malice The defence of fair comment may be defeated by the claimant proving malice.

following conditions are met: the statement complained of was a statement of opinion and not an assertion of fact; the statement indicated the basis of the opinion; and an honest person could have held the opinion on the basis of:

indifference as to its truth. An improper motive is usually shown by the claimant proving that the defendant had knowledge that the sole or dominant purpose of the statement was to harm the claimant. 42

Defamation Act 1996, ss.2-4. Defamation Act 2013, s.2. Defamation Act 2013, s.2(3). Horrocks -v- Lowe [1975] AC 135, HL at 149-151. Defamation Act 2013, s.3.

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Defence

Issues

Changes under the Defamation Act 2013

the comment must be understood by the reasonable reader as comment rather than an imputation of fact; and

However, unlike with the defence of qualified privilege, intention to injure, even if it is the dominant or sole motive, will not of itself defeat the defence of fair comment.

any fact which existed at the time the statement was published; or

anything asserted to be a fact in a privileged statement published before the statement complained of.

the comment was an opinion an honest minded person could make on the facts. In respect of fair comment, a defendant will be acting with malice when he does not genuinely hold the view expressed or is recklessly indifferent to the truth or falsity of his comments. An intention to injure is not conclusive.

This is broadly similar to the defence of fair comments but simplified so there is no longer a need to prove the fact upon which an honest person could have held such an opinion, and no need for the comment to relate to matter of public interest 44 . The exception is defeated if the claimant shows that the defendant did not hold the opinion, or, if the statement was only published by the defendant but made by another person, if the defendant knew or ought to have known that the author did not hold the opinion.

Qualified privilege Arises where publications are shown to have been made by a person acting under a duty to a person with a corresponding interest and other similar "public interest" situations. 45 A privileged occasion will exist where the maker of the statement is under a legal, social or moral duty to make the statement and/or the recipient has an interest in receiving it. This is the most contentious defence. It protects communications of a "private"
44 45 46 47 48 49 50 51 52

Defeated by proving malice (see Fair comment above).

Matter of public interest 51 This defence replaces the Reynolds

Qualified privilege may also protect publication to the public at large in newspapers, or similar publications, if the matter is of sufficient public interest following the House of Lords' decision in Reynolds -vTimes Newspapers Ltd. 48 In this case the Lords set out a nonexhaustive list of ten factors to be taken into account in determining whether a publication by a newspaper would be protected by qualified privilege:

defence 52 . It will apply to statements of fact as well as to statements of opinion provided that the defendant shows that: the statement complained of was, or formed part of, a statement on a matter of public policy; and the defendant reasonably believed that publishing the statement was in the public interest. The court will have regard to all the

1.

the seriousness of the allegation;

circumstances of the case to decide whether these conditions apply; it no longer has to consider an established

Public interest becomes a new independent defence as shown below. Toogood -v- Spyring (1834) 1 CM&R 181 at 193. Edmonson -v- Stephenson (1766) Buller's N.P.8. Hunt -v- GN Ry [1891] 2 QB 189 CK. [2001] 2 AC 127, HL. Seaga v- Harper, [2009] 1 A.C. 1. [2012] UKSC 11 (SC). Defamation Act 2013, s.4. The new defence is in fact based on the Reynolds defence which it seeks to simplify. See Explanatory Notes, paragraph 29.

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Defence

Issues

Changes under the Defamation Act 2013

nature where some existing relationship exists and is most commonly used in the context of business relationships. For example: directors informing shareholders or employees about an imminent takeover; where an employer (who has a duty) gives an employment reference to a new employer 46 (who has an interest in receiving the information);

2.

the nature of the information and the extent to which it was of public concern;

set of factors and must make such allowance for editorial judgement as it considers appropriate. The 2013 Act also acknowledges the common law doctrine of "reportage" as this defence also encompasses the situation where the statement complained of was, or formed part of, an accurate and impartial account of a dispute to which the claimant was a party provided that it was reasonable for the defendant to believe that publishing the statement was in the public interest. The defendant does not need to verify the truth of the imputation 53 .

3. 4.

the source of the information; the steps taken by the defendant to verify the allegations;

5.

the status of the information (e.g. whether it has been the subject of a respected investigation);

6. where an employer informs the workforce that another employee has been dismissed for misconduct; 47 and (probably) a report made without malice by an employee or former employee of a regulated business to its Regulator. 9. 8. 7.

the urgency of the information; whether comment was sought regarding the allegation from the claimant;

Extensions of the scope of whether the article contained the gist of the claimant's side of the story; The 2013 Act also extends the the tone of the article; and circumstances in which the defence of qualified privilege applies 55 : its scope 10. the circumstances of publication including time. The Reynolds defence extends to published material of public interest in any medium (not just press and broadcasting media), so long as the Reynolds conditions as applicable to "responsible journalism" are satisfied. 49 The decision in Reynolds was revisited by the UK Supreme Court in Flood v- Times Newspaper Ltd. 50 There the Supreme Court took a broad approach to the public interest test mentioned in Reynolds and gave a wide degree of latitude to the press when reporting allegations which were subsequently shown to be factually untrue. is extended from reports of certain UK or EU proceedings or official documents to equivalent reports or proceedings produced anywhere in the world. Thus, where for instance the current scope of the privilege only covers proceedings at any public meeting of any authority performing a public function in the EU, the privilege will be extended to cover proceedings at any public meeting of any public authority anywhere in the world. application of the defence of qualified privilege 54

53 54 55

Defamation Act 2013, s.4(3). Defamation Act 2013, ss.7(2)-7(10). See below in relation to the defence applicable to reports protected by privilege.

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Defence

Issues

Changes under the Defamation Act 2013

Absolute privilege A complete defence which affords people protection to say what they want without any fear of legal action, regardless of how damaging or malicious their words may be. Includes Parliamentary proceedings and papers, affairs of state, fair and accurate reports of court proceedings in the UK, certain European courts and international tribunals which are published contemporaneously.

Extensions of the scope of application of the defence of qualified privilege 56 The 2013 Act updates and extends the circumstances in which the defence of absolute privilege apply. In general, absolute privilege will apply to a wider range of reports of court proceedings to cover fair and accurate reports of proceedings in any courts established under the law of a country outside the UK, and any international court established by the Security Counsel of the United Nations or by an international agreement. Peer-reviewed statements in scientific or academic journals 57 The 2013 Act creates a new defence for statements in scientific or academic journals which are deemed privileged- provided that: the statement relates to a scientific or academic matter; and an independent review of the statement's scientific or academic merit was carried out by the editor of the journal or one or more people with expertise in the matter concerned.

8.

What are the remedies for defamation?

Pre-Action protocol
The Pre-Action Protocol for Defamation is designed to "encourage exchange of information between parties at an early stage and to provide a clear framework within which parties to a claim in defamation, acting in good faith, can explore the early and appropriate resolution of that claim". Litigation is a last resort and parties are expected to comply with the terms of the protocol before issuing proceedings. However, the protocol does acknowledge that defamation claims are different to other areas of civil litigation. In particular, it recognises that "time is of the essence" in such disputes and that "almost invariably, a claimant will be seeking an immediate correction and/or apology as part of the process of restoring his/her reputation". The protocol contains guidelines on the contents of the letter before claim which should be sent "at the earliest reasonable opportunity". The claimant must identify the publication or broadcast complained of and, if possible, produce a copy or transcript and explain why the relevant words are inaccurate or unsupportable. The defendant
56 57

Defamation Act 2013, s.7(1). Defamation Act 2013, s.6.

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is required to respond as soon as reasonably possible. The protocol also suggests various forms of alternative dispute resolution. If the dispute does proceed to litigation both parties will be expected to provide evidence to the court that they considered alternative ways of settling the dispute.

Summary disposal - apology

Under sections 810 of the Defamation Act 1996 if it appears there is no defence to the claim which has a realistic prospect of success and that there is no other reason why the claim should be tried, the court may give judgment for the claimant and grant him summary relief. Alternatively, the court can dismiss the claim if it appears to have no realistic prospect of success. 58 Unless the claimant asks for summary relief, the court shall not grant it unless it is satisfied that summary relief will compensate the claimant adequately for the wrong he has suffered. This effectively means at the present time that the court must be satisfied that damages of 10,000 or less would be sufficient. 59 Summary relief also includes a defamation declaration that the statement was false and defamatory and an order that the defendant publishes a suitable correction and apology.

Non-judicial remedy
The Press Complaints Commission (PCC, 020 7831 0022; www.pcc.org.uk) is an independent organisation which deals with complaints about the editorial content of newspapers and magazines. OfCom (020 7981 3040; http://www.ofcom.org.uk) performs a similar function in relation to material broadcast on television or radio. In December 2011 Lord Hunt announced his plans to replace the PCC with a new independent regulator and on 29 November 2012, the Leveson report recommended the creation of an independent self-regulatory body which would replace the PCC and have a range of sanctions available to it, including fines and directions for the prominence of apologies and corrections. The government refused to consider introducing statutory underpinning for a new press regulator but unveiled, on 12 February 2013, its proposal to create a new regulator by Royal Charter. A revised draft Royal Charter on press regulation was published on 18 March 2013 60 which proposes the creation of a new body - the Recognition Panel - tasked with certifying an independent press self-regulatory body. The Charter also lists a number of "recognition criteria" which will have to be complied with by any selfregulatory body seeking to be recognised by the Panel 61 . A rival draft charter for the creation of a new press regulator was also issued by a group of publishers on 25 March 2013, and a consultation was initiated on this second proposal by the Privy Council, open until 24 May 2013. A second consultation is expected on the cross-party proposal at a later stage this year. Both proposals are controversial and very different; their co-existence creates uncertainties about the shape and powers of the future new regulatory body.

Damages
Under the current regime, damages for defamation come under four categories: General damages: compensate the claimant for the harm caused to his reputation at large; Special damages: awarded if the claimant can show any specific loss arising from the defamatory statement (for example, that he lost a contract because of the defamatory statement);

58 59 60

Defamation Act 1996, s.8(2) and (3). The limit set by Defamation Act 1996, s.9(1)(c). This proposal was the product of a compromise between the three main political parties. The agreement also included amendments to the Crime and Courts Bill now Crime and Courts Act 2013 - which introduced exemplary damages for publishers who refused to join the new body, as an incentive to join the new press self-regulatory body. These conditions essentially prescribe requirements with regard to the body's independence, composition, duty to adopt standards codes, complaints procedures, sanctioning powers, funding, investigative powers and the condition that the body would provide an arbitration process.

61

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Exemplary damages: allowed if the claimant can show the defendant knew or was reckless as to whether the words were false and defamatory and that they were published with the motive that the economic advantage to the defendant outweighed the potential penalty; 62 and

Aggravated damages: allowed if there are factors which, in the minds of the jury, worsen the defamation. This can include the conduct of the defendant in the action, or malice on his part in publishing the defamatory statement.

Under the Crime and Courts Act 2013, special rules will apply to decide whether a certain number of Relevant Publishers 63 , who commit libel or slander, may be liable to pay exemplary or aggravated damages . With regards to such publishers: exemplary damages must be claimed by the claimant and can only be awarded if the court is satisfied that the Relevant Publisher has shown a deliberate or reckless disregard of an outrageous nature for the claimants' rights. The court must be satisfied that exemplary damages are the right course of action, that other remedies will not suffice and that the level of damages is the minimum necessary and proportionate to the seriousness of the conduct; and aggravated damages cannot be awarded to punish the defendant and can only be awarded to compensate the claimant for mental distress.

The level of damages is still usually decided by the jury at trial. Both parties are now allowed to address the jury on what the size of the award should be, but do not always do so. In particular, the size of general damages awards in personal injury claims may be stated as a comparison. The ceiling for such damages is around 275,000 64 and, in practice, recent awards of general compensatory damages have been substantially lower than this ceiling even where very serious allegations of defamation have been proven 65 . Despite these new rules, substantial awards are still made. The defendant may appeal the damages awarded by the jury to the Court of Appeal. However, the 2013 Act removes the presumption in favour of jury trials 66 , which means that, in the future, defamation cases will be tried without juries and that damages will be decided by judges unless a court orders otherwise.

Interim injunctions -v- freedom of expression

It is very difficult to get an injunction to stop what is believed to be the imminent publication of defamatory material. Under section 12 of the Human Rights Act 1998, a court considering an application for prior restraint must pay particular regard to the importance of freedom of expression. In spite of this, there are occasions where an injunction may be ordered, for example to prevent the disclosure of truly confidential information, or when it can clearly be shown that the claimant is likely to succeed at trial. To succeed, there must be evidence of intention to publish or repeat and the claimant must clearly specify what the published words will be 67 . In addition, the courts generally refuse to grant an interim injunction to the claimant if the defendant genuinely intends to plead a defence of justification, 68 fair comment on a matter of public interest or qualified privilege

62 63 64 65

Elton John -v- MGN Limited [1997] QB 586. "Relevant Publisher" is defined as a person who, in the course of a business, publishes news-related material which is written by different authors and is subject to editorial control (Crime and Courts Act 2013, s.41). Cairns v- Modi/KC v- MGN Ltd [2012] EWCA Civ 1382, paragraph 25. For instance in KC v- MGN, it was wrongly stated that KC had been convicted of the rape of a 14 year old, which was recognised by the court as a "very serious allegation". The court only awarded 50,000, (with a starting point of 100,000 but a 50% discount to account for the offer of amends procedure followed by the publishing newspaper). In Bento v- The Chief Constable of Bedfordshire Police [2012] EWHC 1525 (QB), the court awarded 125,000 to a claimant who had been accused of murder in an official press release published by the Chief Constable following acquittal. Serious allegations of professional misconduct in Cambridge v- Makin [2011] EWHC 12 (QB) (allegation of conflict of interest and abuse of position as a non-executive director of a company) and in Thornton v- Telegraph Media Group Ltd [2011] EWHC 1884 (QB) (allegation that the claimant had dishonestly claimed to have carried out an interview and gave copy approval to her interviewees) only gave rise to awards of 30,000 and 50,000 respectively. Defamation Act 2013, s.11. The claimant must provide the court with almost the precise words, see British Data Management plc -v- Boxer Commercial Removals [1996] 3 All ER 707, HL. The rule in Bonnard -v- Perryman [1891] 2 Ch 269, CA.

66 67 68

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where there is no evidence of express malice. The American Cyanamid 69 test, which sets out the circumstances where an interim injunction may be granted by applying the "balance of convenience", does not apply.

9. Future developments: statutory instruments and uncertainties with regard to costs

Further clarifications or changes to defamation law are expected in the coming months. In particular some implementation measures, by Regulation, are awaited in relation to the new defence created for website operators. Further changes are also considered with regard to costs following the implementation of the Jackson recommendations on civil litigation costs 70 . Funding: Under Part 2 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO), parties will have to bear the costs of lawyers' success fees and any after the event (ATE) insurance premium for conditional fee agreements and ATE policies entered into after 1 April 2013 71 . However, the government announced in December 2012 that defamation and privacy claims would be excluded 72 and these claims are currently exempt. As a result, success fees and insurance premiums will continue to be recoverable in defamation and privacy claims until a new regime of costs protection can be implemented through changes to the civil procedure rules (CPR) 73 . Cost Management: A mandatory pilot costs management scheme in defamation cases was launched as a result of the Jackson review. This scheme organises the submission of detailed estimates of future base costs and stricter duties for the court who must manage the costs in a manner which is proportionate to the value of the claim and the reputational and public interest issues at stake (PD 51D). This pilot ran until 31 March 2013 and will continue to apply to defamation claims issued before that date 74 . From 1 April 2013, new costs management rules 75 will apply to all multi-track cases 76 , including defamation claims, with a view to reducing costs to what is proportionate.

69 70 71 72 73

American Cyanamid Co -v- Ethicon Ltd [1975] AC 396. Review of Civil Litigation Costs, Final Report of Lord Justice (http://www.judiciary.gov.uk/JCO%2fDocuments%2fReports%2fjackson-final-report-140110.pdf). LASPO, ss. 44 and 46. Written Ministerial Statement of the Parliamentary Under-Secretary of State for Justice (Mrs Helen Grant) on the implementation of Part 2 of LASPO, 12 December 2012. These changes are still being reviewed. In particular, recommended changes include the possibility of implementing a 10% increase in damages awarded for defamation claims, to compensate claimants for no longer being able to recover success fees from a losing opponent; and relieving claimants of liability for a successful defendant's legal costs (save in exceptional circumstances) (system known as "Qualified One-Way Costs Shifting"). For more details on the pilot scheme, and a few others set up following the Jackson Review, see Costs Management Pilot - Final Report, 1 May 2013 ( http://www.judiciary.gov.uk/Resources/JCO/Documents/Reports/costs-management-pilot.pdf). CPR 3.12 to 3.18. These new rules, which are similar and based on the rules used under the pilot scheme, require the submission of detailed costs estimates before the first CMC and more active cost managements duties for the court to ensure that costs remain proportionate. CPR 3.12. The new rules will apply to all courts except (1) where the proceedings are the subject of fixed costs or scale costs or the court otherwise orders, (2) claims in the Commercial Court, and (2) claims of over 2 million in the Chancery, Technology and Construction Court and Mercantile Courts. Jackson, December 2009:

74 75 76

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Malicious falsehood
10. How does it differ from defamation?

Malicious falsehood primarily protects property rights. The claimant is required, therefore, to prove financial loss and the claimant's compensation will be more closely linked to actual financial loss. Defamation, on the other hand, protects reputation, and therefore more substantial damages can be awarded even where there is no financial loss, as the purpose of the award is to vindicate the claimant's reputation and compensate him for injury to feelings 77 .

11.

Advantages and disadvantages

The advantage of bringing a claim in malicious falsehood is that the claimant does not need to show that the statement is of a defamatory nature. Malicious falsehood survives the death of either party and the right to sue passes to the personal representatives. The disadvantages of bringing a claim in malicious falsehood are that the claimant has to prove that the statement is false whereas in defamation it is presumed to be false and it is up to the defendant to prove it to be true. The claimant must also prove that the defendant published the words maliciously knowing them to be false or indifferent as to their truth. In defamation there is no obligation to prove malice 78 .

12.

Basic ingredients

Malicious falsehood is the generic term for the malicious publication of false statements which cause damage to the claimant. The claimant must prove that: the words complained of are false; the words were published maliciously; and the publication must have caused financial loss or be likely to cause such loss unless:

the words are calculated to cause pecuniary damage to the claimant and are published in writing or other permanent form; 79 or the words are calculated to cause pecuniary damage to the claimant in respect of any office, profession, calling, trade or business held or carried on by him at the time of the publication. 80

There are no specific defences to a claim for malicious falsehood; the burden is on the claimant to prove falsity and malice but the court rules require the defendant to admit or deny or state if he cannot admit or deny the allegations. 81

77 78 79 80 81

The distinction is likely to become less obvious with the 2013 Act's requirement of serious harm, especially in the case of corporate bodies as those are now required to show that the defamatory statement caused serious financial loss. Except if a defence of fair comment or qualified privileged is raised under the current law, or if a defence of operators of website or peer-reviewed publication is raised under the 2013 Act. Defamation Act 1996, s.3(1)(a). Defamation Act 1996, s.3(1)(b). CPR Part 16.5.

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Ashurst Quickguides
Ashurst's Quickguides are a regularly updated mini-library of short legal summaries on a range of key issues relevant to businesses. For a full list of current titles and the most up-to-date versions, please visit the publications section of our website (www.ashurst.com). If you would like further information on this guide, please speak to your usual contact at Ashurst or one of our contacts listed below. Angela Pearson T: +44 (0)20 7859 1557 E: angela.pearson@ashurst.com Lauren Bernard T: +44 (0)20 7859 1056 E: lauren.bernard@ashurst.com Djalila Boumezbeur T: +44 (0)20 7859 2539 E: djalila.boumezbeur@ashurst.com