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SYDNEY ALFRED HOLLEY SD & R TRADING LIMITED HENRY ANSBACHER and CO. LIMITED ANSBACHER (JERSEY) LIMITED v. DUNCAN JOHN SMITH [1997] EWCA Civ 2914 (4th December, 1997)
IN
THE SUPREME COURT OF JUDICATURE
QBENI
97/0921/E
IN
THE COURT OF APPEAL (CIVIL DIVISION)
ON
APPEAL FROM THE QUEEN'S BENCH DIVISION
(Mr
Justice Ian Kennedy
)
Royal
Courts of Justice
The
Strand
London
WC2
Thursday
4th December, 1997
B
e f o r e:
LORD
JUSTICE STAUGHTON
LORD
JUSTICE AULD
SIR
CHRISTOPHER SLADE
-
- - - - -
SD
& R TRADING LIMITED
HENRY
ANSBACHER & CO. LIMITED
ANSBACHER
(JERSEY) LIMITED
Respondents
-
v -
DUNCAN
JOHN SMITH
Appellant
-
- - - - -
(Handed
down Transcript of Smith Bernal Reporting Limited
180
Fleet Street, London EC4A 2HD
Tel:
0171 421 4040
Official
Shorthand Writers to the Court)
-
- - - - -
MISS
P BAXENDALE QC and MR G CLARKE
(Instructed by Messrs Lupton Alsop, London WC4R 2SS) appeared on behalf of the
Respondents
MR
W BENNETT
(Instructed by Messrs Wright Hassall & Co., Leamington Spa CV32 5QP)
appeared on behalf of the Appellant
-
- - - - -
J
U D G M E N T
(As
approved by the Court
)
-
- - - - -
©Crown
Copyright
Thursday
4th December, 1997
JUDGMENT
LORD
JUSTICE STAUGHTON: For the reasons which have been handed down this appeal
will be allowed. If the defendant is prepared to give the undertaking offered
the injunction will be discharged.
Mr
Smyth appeals by leave of the judge from an order of Kennedy J. granting an
interlocutory injunction against him. According to an affidavit of the
plaintiffs' solicitors, the first plaintiff (Mr
Holley) is a director of the
second plaintiffs, SD & R Trading Limited, a Jersey company; the third
plaintiffs, Henry Ansbacher & Co Ltd, are a well-known merchant bank; the
fourth plaintiffs, Ansbacher (Jersey) Ltd, are a Jersey trust company and
merchant bank of which Mr
Holley is the company secretary.
On
8th May 1997 Mr
Smyth wrote a letter to the plaintiffs'
solicitors
and sent it by fax. Attached were two draft press releases, for practical
purposes in identical terms. They accused Mr
Holley of disreputable conduct in
a financial transaction, and the Ansbacher companies of trying to distance
themselves from his conduct and to disclaim responsibility. I do not set out
any further details, since the
very object of these proceedings and of the
judge's order was to restrain publication of Mr
Smyth's allegations until they
have been investigated by a jury.
Mr
Smyth protests that he intends to justify his assertions, if he is allowed to
publish them and is subsequently sued for defamation. That at once introduces
the doctrine in
Bonnard
v. Perryman
(1891) 2 Ch 269. Lord Coleridge CJ, in a judgment with which Lord Esher MR and
Lindley, Bowen and Lopes L.JJ agreed, said this (at p.284):
"But
it is obvious that the subject-matter of an action for defamation is so special
as to require exceptional caution in exercising the jurisdiction to interfere
by injunction before the trial of an action to prevent an anticipated wrong.
The right of free speech is one which it is for the public interest that
individuals should possess, and, indeed, that they should exercise without
impediment, so long as no wrongful act is done; and, unless an alleged libel is
untrue, there is no wrong committed; but, on the contrary, often a
very
wholesome act is performed in the publication and repetition of an alleged
libel. Until it is clear that an alleged libel is untrue, it is not clear that
any right at all has been infringed; and the importance of leaving free speech
unfettered is a strong reason in cases of libel for dealing most cautiously and
warily with the granting of interim injunctions. We entirely approve of, and
desire to adopt as our own, the language of Lord Esher, M.R., in Coulson
v.
Coulson - "To justify the Court in granting an interim injunction it must come
to a decision upon the question of libel or no libel, before the jury have
decided whether it was a libel or not. Therefore the jurisdiction was of a
delicate nature. It ought only to be exercised in the clearest cases, where
any jury would say that the matter complained of was libellous, and where, if
the jury did not so find, the Court would set aside the
verdict as
unreasonable." In the particular case before us, indeed, the libellous
character of the publication is beyond dispute, but the effect of it upon the
Defendant can be finally disposed of only by a jury, and we cannot feel sure
that the defence of justification is one which, on the facts which may be
before them, the jury may find to be wholly unfounded; nor can we tell what may
be the damages recoverable."
And
at p.285:
"Upon
the whole we think with great deference to Mr Justice North, that it is wiser
in this case, as it generally and in all but exceptional cases must be, to
abstain from interference until the trial and determination of the plea of
justification."
That
wholesome doctrine has often been acted on. The last occasion that I can
recall was in
Maxwell
Communications Corporation plc v. Newspaper Publishing plc
,
1st August 1991, when it was sought to restrain publication of allegations
about the financial state of the Maxwell empire. The appeal failed.
But
in this case there is a new factor to be considered. Mr
Smyth at and before
his letter of 8th May 1997 made it clear that what he wanted was not to publish
truth, but to extract money from the plaintiffs as the price of not doing so.
He wrote in the letter:
"I
am disappointed that you seek to distance your client from the transactions in
1991. Your client's position is akin to that taken by Rothchilds in 1994 when
they also tried to avoid their obligations by adopting a similar stance, only
to pay out in 1995 after public humiliation in the Press and T.
V. The matter
was never litigated.
For
many years I was Chairman of a significant full-services Advertising Agency in
Charlotte Street and I have therefore applied my expertise to drafting the
enclosed Press Release on this affair. As you will note it is embargoed until
May 30th so that your client can reflect again upon their position in this
affair
vis a
vis the role of their Company Secretary.
I
would state again my willingness to enter into a negotiated full and final
settlement with your client in the matter of the £200,000 paid to SD&R
Trading Limited in 1991 which was made mainly upon the basis of Mr
Holley's
assurances as to the probity of the deal.
"Under
the circumstances I would appreciate any proposals you may have to quietly set
the matter straight by a full repayment of the monies paid by the Trust, with
interest at judgment rates from the date of purchase.
...
Your response within seven days is required. Should you not make constructive
proposals by this date I would add this matter as a further formal complaint to
those already with Detective Chief Inspector
Varriale of the Special
Investigations Unit of the Warwickshire CID ..."
A
further letter of 2nd April 1997 included these passages:
"As
you will see I have a wealth of correspondence and documentation which links
you and your Company to a series of dubious transactions. My interest is to
recover what I can from those who have misled or defrauded the Trust although I
do not regard litigation as the route I will necessarily use.
........
Would
you please consider the information provided and let me know how your
organisation proposes to deal with this matter bearing in mind the substantial
amounts of money that have been lost.
A
response within seven days is required with some firm proposals otherwise the
matter will be passed to the appropriate authorities. If you feel a meeting
would be of assistance in determining the way forward then please contact me."
Again
on 8th April 1997 there was these passages in a letter to the chairman of Henry
Ansbacher (Holdings) Ltd:
"I
have been investigating these matters for over three years and have untangled a
web of deceit and fraud which would be a media delight. In fact, some of my
investigations have led to eight formal complaints being made to the City of
London Police. The Fraud Investigation Department, Wood Street Police Office,
only await my completed Statement to launch a major investigation covering
professionals, banks and others.
I
would ask that you review the correspondence which I have sent to Jersey and
ensure that some substantial proposals to settle this matter are made as
quickly as possible."
Is
this nevertheless a case to which the rule in
Bonnard
v. Perryman
applies, despite the manifest intention of Mr
Smyth to use the threat of
publication as a means of extracting money from the plaintiffs? Kennedy J.
thought not. He said this:
"
Bonnard
v. Perryman
is, to my mind, founded upon the fundamental right of free speech. Until the
words have been proved to a jury to be incapable of justification that right is
not lightly to be curtailed. Further, there is an important public interest in
wrongdoing being brought to light.
In
my judgment, it is a quite different case where a person, as did the defendant
here, makes a claim for money on terms, which I am quite certain his letter
involves, that if he is satisfied in respect of his claim he will remain silent
about the alleged wrongdoing. That person is not the assumed guardian of the
truth that is he who speaks out asserting the right of free speech, as
contemplated by Lord Coleridge. To be paid to be silent is not of the same
currency as free speech. The public interest which encourages those who speak
out about wrongdoing is not served by giving the like protection to those who
propose to speak out only because they have not been paid to remain silent. To
accord that same protection would positively be a disservice to the revealing
of wrongdoing."
Accordingly
Kennedy J. granted an injunction. But he excepted from it publication to the
Financial Services Department of the States of Jersey, the Bank of England, the
Securities and Futures Authority, the police and any other regulatory or
investigative authority or ombudsman which or who has a duty to investigate
allegations of the kind contained in the press releases.
I
entirely agree with the judge's assessment of the facts. But it is said that
we are precluded by authority from upholding the injunction which he granted.
First there is
Bestobell
Paints Ltd v. Bigg
(1975) FSR 421. Mr Bigg and his partner were decorators, and used some brown
paint sold by the plaintiffs with the trade mark CARSONS. After six months the
paint started to turn green. Mr Bigg and his partner wrote to the plaintiffs
complaining and seeking recompense. What followed is stated in the judgment of
Oliver J. at p.423:
"By
April of this year the two sides had taken up entrenched positions and on 16
April the defendant, Mr Bigg, wrote to the plaintiffs saying that he and his
company were in a small way of business and did not feel disposed to engage in
litigation. What he proposed to do, therefore, was to send details of the case
to a newspaper column called "Action Line" (which has been
variously attributed
to the Daily Express and the Daily Mail) and also to erect a 6ft by 6ft
hoarding outside the property with the words: "This is an example of Hadfields
(Carsons) paints".
There
can be no doubt whatever - and indeed it is not suggested otherwise - that this
threat was intended to put pressure on the plaintiffs to settle the defendants'
claim. Mr Aldous , who appears for the plaintiffs, has described it as
blackmail, but it would, I think, be better to avoid such pejorative
expressions until the facts have been fully established at the trial.
In
the event, the defendants did not carry out their threat literally, but they
did, at the end of May, place a notice on the outside wall of 143 Lavender
Sweep of rather more modest proportions than the threatened 6ft x 6ft but still
clearly legible to anybody passing by. It reads: "This house is painted with
CARSONS
paint. The word "Carsons" is in capital letters and is underlined. The house
is, I understand, near the South Circular Road and may be said, therefore, to
command a wide section of the reading public."
Oliver
J., after referring to the case of
Crest
Homes Ltd v. Ascott
(1980) FSR 396, said (at p.435) -
"So
quite clearly the court did not there consider that the fact that the statement
made was calculated to damage the plaintiffs in their business and was made
with a
view to putting pressure on them to settle the defendant's claim for
compensation took the case out of the general rule."
He
refused an injunction.
In
the
Crest
Homes
case Mr Ascott had bought a house from Crest Homes Ltd, who were builders. The
front door began to shrink and crack, and the paint peeled off. Mr Ascott
wrote to Crest Homes, but got no satisfaction. So he fixed the door to the
front of his car and drove round the estate, with a notice on the door saying
that it was fitted by Crest and was typical of the poor quality materials used.
He also sent them a telegram, which read:
"Demo
scheduled September 7th cannot disclose where - Nat. Press attending - Ascott."
The
Court of Appeal set aside an injunction which Waller J. had granted. Lord
Denning MR said at p.398:
"Next
Mr Neill said that it was done so as to get the Crest Homes Ltd to give
compensation. Mr Ascott ought to have brought an action and not acted in that
manner. That may be so, but nevertheless it is not sufficient to take the case
out of the general rule.
In
my opinion this case comes within the general rule that an interlocutory
injunction will not be granted in a libel case where the defendant says he is
going to justify. I would allow the appeal and discharge the injunction."
Stephenson
LJ said:
"Like
my Lord, I agree that there may be exceptions to that general rule, and the
court will restrain a defendant in such a case when it is just and convenient.
But this is not such an exceptional case."
And
Geoffrey Lane LJ (at p.399):
"If
there are any exceptions to the general rule, the facts of this particular case
do not fall within them."
Thirdly
there is the case of
Al
Fayed v. The Observer Ltd
,
The Times 14th July 1986. There Mann J held that the general rule still
applied where there was "a persistent and irresponsible journalistic campaign
against the plaintiffs which was conducted as a
vendetta"; that was not an
exceptional case such as was contemplated by the authorities.
It
is said on the basis of those decisions that the only exception to the general
rule is where the material said to be defamatory is "manifestly untrue" or
"obviously unfounded". I do not agree, for I accept Miss Baxendale's argument
that there always remains a discretion in the grant or refusal of an equitable
remedy. As Stephenson LJ said, the court will restrain a defendant when it is
just and convenient - and the statute says that too. Here Mr
Smyth does not
wish to publish the material in question; he has not yet done so; he is not
concerned to increase the store of knowledge available to the public. His
concern is to obtain money for himself or for a trust with which he is
associated. The fact that Mr
Smyth has no wish to publish at all distinguishes
this from earlier cases. It is in my opinion a case of demanding money with
menaces, although whether or not it would be an offence under section 21 of the
Theft Act 1968 would be for a jury to decide. It is far more serious than
either the
Bestobell
Paints
case or the
Crest
Homes
case.
As
is not uncommon in these days, we were referred to the European convention for
the Protection of Human Rights and Fundamental Freedoms, and to Article 10
which deals with the freedom of expression. I do not see that this has any
impact on the present problem. It is conceded that there may lawfully be
restrictions on defamation; these would be permitted as being for the
protection of the reputation or rights of others (Article 10.2). It is
likewise conceded that there can be a prohibition on the making for gain of an
unwarranted demand with menaces. I suppose that such a prohibition can be
justified as a measure for the prevention of disorder or crime; but at all
events it is not conduct which strikes one
very obviously as the exercise of a
human right or fundamental freedom. There is therefore no call to refer to the
judgment of Hoffmann LJ in
R
v. Central Independent Television plc
(1994) 3 WLR 20 at p.30, where he said:
"It
cannot be too strongly emphasized that outside the established exceptions, or
any new ones which Parliament may enact in accordance with its obligations
under the Convention, there is no question of balancing freedom of speech
against other interests. It is a trump card which always wins."
By
contrast when one is considering established exceptions to the right of freedom
of expression, as in this case, there are No Trumps.
If
it is proper under the Convention to restrain the publication of matter which
is proved to be defamatory, or the making of what are proved to be unwarranted
demands with menaces, I do not see that it must always be improper to restrain
pending trial conduct which may later be found to fall within one or other
description. Of course the discretion to do so must be exercised with great
caution as English law clearly provides. But in my judgment there remains a
discretion to grant an interlocutory injunction pending trial in rare cases, of
which this is one. Mr
Smyth remains at liberty to disclose his material to the
regulatory authorities mentioned in the order. He must be content with that.
In
the circumstances I need not express any
view on the point raised by the
Respondents' notice (that Mr
Smyth would not be able to justify his
allegations); and I do not do so. I would dismiss this appeal.
LORD
JUSTICE AULD: The Court is asked to decide whether a defendant who threatens
defamation of the plaintiff to obtain money from him as the price of silence
may rely on the rule in
Bonnard
v. Perryman
[1891] 2 Ch 269, CA, that interlocutory relief to restrain defamation is not
ordinarily granted where there is a defence or claim of justification unless
the plaintiff can show that it is plainly untrue.
The
Facts
The
proceedings arise out of a somewhat complicated transaction in 1991 in which a
trust established by Mr.
Smyth paid £200,000 to the second plaintiff, a
company controlled by the first plaintiff, Mr.
Holley. The payment was for
shares in two Spanish companies who were said to own developable land in Spain.
I say "said to own" because Mr.
Smyth maintains that the companies' title to
the land was defective and that, as a result, the trust has lost its
investment. He maintains that Mr.
Holley and the second plaintiff fraudulently
misrepresented to him at the material time that an adverse claim to the land
was unlikely to succeed. As to the third and fourth plaintiffs, Mr.
Smyth
claims that, by
virtue of their relationship with Mr.
Holley and/or the second
plaintiff, they owed him, Mr.
Smyth, a duty to respond to his complaint of
fraud by investigating it expeditiously, and they have not done that.
The
plaintiffs' case is that there was always some uncertainty about the companies'
entitlement to the land and that Mr.
Smyth knew that before the trust made the
investment. They say that he and the trust took the risk. The first and
second plaintiffs deny any fraudulent misrepresentation. The third and fourth
plaintiffs deny that they owed any duty to Mr.
Smyth to investigate or
otherwise act on his complaint but say that they have in fact attempted to do
so.
Mr.
Smyth, having unsuccessfully sought the return of the money from the second
plaintiff, threatened to publish his complaints of fraud by Mr.
Holley and the
second plaintiff and of indifference to his complaint by the third and fourth
plaintiffs. His expressly declared purpose in making that threat was to
extract from one or other of them the return of the trust's investment as the
price of his silence. His threat prompted the plaintiffs to issue these
proceedings against him to restrain the threatened libel and also to apply for
interlocutory injunctive relief. Mr.
Smyth, by his pleaded defence and in
affidavit evidence in response to the application, maintained that he could
justify his allegations of fraud and indifference.
The
Judge's Ruling
Ian
Kennedy J., on the evidence before him, was unable to find that the plea of
justification was plainly untrue. He decided, nevertheless, that it was a case
for the grant of interlocutory relief, save in respect of the threatened
publication to public regulatory and investigative authorities. He held that
the
Bonnard
v. Perryman
rule is founded on the right of free speech and that it does not protect a
defendant whose motive is to extract money from the plaintiff as the price of
not exercising it. This is how he reasoned the matter, at pages 9 and 10 of
the transcript of his judgment:
"
Bonnard
v. Perryman
is, to my mind, founded upon the fundamental right of free speech. Until the
words have been proved to a jury to be incapable of justification that right is
not lightly to be curtailed. Further, there is an important public interest in
wrongdoing being brought to light.
In
my judgment, it is a quite different case where a person, as did the defendant
here, makes a claim for money on terms, which I am quite certain his letter
involves, that if he is satisfied in respect of his claim he will remain silent
about the alleged wrongdoing. That person is not the assumed guardian of the
truth that is he who speaks out asserting the right of free speech, as
contemplated by Lord Coleridge. To be paid to be silent is not of the same
currency as free speech. The public interest which encourages those who speak
out about wrongdoing is not served by giving the like protection to those who
speak out only because they have not been paid to remain silent. To accord
that same protection would positively be a disservice to the revealing of the
wrongdoing.
Further,
the
very fact that there is an offer to remain silent at a price leads one to
question the truth of the charges being traded, for such a proposal is not
ordinarily made by a trustworthy and reliable person. So, while I must, as
ever, be cautious in determining whether to order an interlocutory injunction,
this case is a
very different one to the general where it is suggested that
injunction should go against one who intends to justify an alleged libel ...
If
I continue this injunction with the modifications as to public authorities then
the true merits of either side's case can be considered without the plaintiffs
being subjected to 'public humiliation in the press and on TV', while any
wrongdoing can be investigated by the proper authorities. If I do not, there
must be risk of the plaintiffs being forced to concede an unsound claim to
avoid the sort of clamour which so often accompanies the making of charges but
so rarely is heard when those charges are successfully refuted. I am clearly
of the
view that the balance of fairness and convenience in the context of this
case requires the maintenance of the injunction against the dissemination of
these charges beyond the extent to which I have already referred."
The
Bonnard
v. Perryman Rule
Since
Fox's Libel Act of 1792 the questions "libel or no" and whether any libel is
justified or privileged have been the responsibility of the jury
[1].
The possibility of judicial intrusion on that responsibility at the
interlocutory stage had to await another sixty years. As Lord Coleridge CJ
pointed out in
Bonnard
v. Perryman
,
at 283, it was not until the enactment of the Common Law Procedure Act in 1854
that common law courts acquired the power to grant injunctive relief. And
Courts of Equity still could not do so because they had no jurisdiction to
adjudicate in libel matters. They had to wait until the Judicature Act 1873
when they became the Chancery Division of the High Court and were thus invested
with power to exercise their traditional injunctive role in the field of
defamation as well as in other actions of tort.
From
the earliest days of the courts' consideration of their power to grant
interlocutory relief in libel cases they seem to have been guided by two
associated notions, one of high principle and one of principle and
practicality. The first is the importance of protecting the individual's right
to free speech. The second is an acknowledgment that the judges should not,
save in the clearest case, usurp the jury's role by restraining at the
interlocutory stage publication of a statement that the jury might later find
to be no libel or true or otherwise defensible. Sometimes the second notion is
expressed in the form that a judge should not interfere at the interlocutory
stage unless the evidence before him so clearly establishes a culpable libel
that he is confident that he would have to set aside a contrary
verdict of the
jury as perverse.
It
is instructive that Blackstone, in
Volume IV, pp. 182-3, of his Commentaries,
published in 1854, long before any Court of Common Law considered the problem,
set the scene in the following ringing tones for the first of those notions,
one which was to guide the grant of interim injunctive relief in libel actions
in later years, at least against the press:
" In
this, and the other instances which we have lately considered, where
blasphemous, immoral, treasonable, schismatical, seditious, or scandalous
libels are punished by the English law, some with a greater, others with a less
degree of severity; the liberty of the press, properly understood, is by no
means infringed or
violated. The liberty of the press is indeed essential to
the nature of a free state; but this consists in laying no previous restraints
upon publications, and not in freedom from censure for criminal matter when
published. Every freeman has an undoubted right to lay what sentiments he
pleases before the public: to forbid this, is to destroy the freedom of the
press: but if he publishes what is improper, mischievous or illegal, he must
take the consequence of his own temerity. To subject the press to the
restrictive power of a licenser, as was formerly done, both before and since
the revolution, is to subject all freedom of sentiment to the prejudices of one
man, and make him the arbitrary and infallible judge of all controverted points
in learning, religion, and government. But to punish (as the law does at
present) any dangerous or offensive writings, which, when published, shall on a
fair and impartial trial be adjudged of a pernicious tendency, is necessary for
the preservation of peace and good order, of government and religion, the only
solid foundations of civil liberty. Thus the will of individuals is still left
free; the abuse only of that free will is the object of legal punishment."
The
starting point in the jurisprudence is a passage from the judgment of Lord
Esher MR in an earlier decision than
Bonnard
v. Perryman
,
namely in
Coulson
v. Coulson
(1887) 3 TLR 846
[2]:
"...
the question of libel or no libel was for the jury. It was for the jury and
not for the Court to construe the document and to say whether it was a libel or
not. To justify the Court in granting an interim injunction it must come to a
decision upon the question of libel or no libel before the jury decided whether
it was a libel or not. Therefore, the jurisdiction was of a delicate nature.
It ought only to be exercised in the clearest cases, where any jury would say
that the matter complained of was libellous, and where, if the jury did not so
find, the Court would set aside the
verdict as unreasonable. The Court must
also be satisfied that in all probability the alleged libel was untrue, and if
written on a privileged occasion that there was malice on the part of the
defendant. It followed from those three rules that the Court could only on the
rarest occasions exercise the jurisdiction."
[3]
The
main issue in the case appears to have been whether the threatened publication
was libellous, but there was also plainly an issue as to the truth of the
allegation. And Lord Esher's reference to the issues of justification and
privilege as well as libel or no libel show that he intended his words to apply
to all matters which were ultimately within the province of the jury. Lindley
LJ, in a short concurring judgment, said much the same:
"...
the Court was asked to exercise its jurisdiction without being sure that it was
in possession of all the facts. [He} agreed with the rules laid down by the
Master of the Rolls, and he was not prepared to say that the jury might not
find this was no libel or that the alleged libel was true."
Lord
Coleridge CJ, giving the leading judgment of the full Court of Appeal in
Bonnard
v. Perryman
,
with which Lord Esher MR and Lindley, Bowen and Lopes LJJ concurred, in favour
of discontinuing the interlocutory restraint in that case, repeated and adopted
those words of Lord Esher in
Coulson
v. Coulson
.
He held that "in all but exceptional cases" (see 285) the courts should not
restrain by way of interlocutory relief the publication of a libel which the
defence sought to justify save where it was clear that that defence would fail.
He based that approach on the particular need in libel cases not to restrict
the right of free speech, save in a clear case of an untrue libel, by
intervening before final determination of the matter by a jury. This is he how
he put it, at 284:
"...
the subject matter of an action for defamation is so special as to require
exceptional caution in exercising the jurisdiction to interfere by injunction
before the trial of an action to prevent an anticipated wrong. The right of
free speech is one which it is for the public interest that individuals should
possess, and, indeed, that they should exercise without impediment, so long as
no wrongful act is done; and, unless an alleged libel is untrue, there is no
wrong committed; but, on the contrary, often a
very wholesome act is performed
in the publication and repetition of an alleged libel. Until it is clear that
an alleged libel is untrue, it is not clear that any right at all has been
infringed; and the importance of leaving free speech unfettered is a strong
reason in cases of libel for dealing most cautiously and warily with the
granting of interim injunctions. ... In the particular case before us, indeed,
the libellous character of the publication is beyond dispute, but the effect of
it upon the Defendant can be finally disposed of only by a jury, and we cannot
feel sure that the defence of justification is one, on the facts which may be
before them, the jury may find to be wholly unfounded; nor can we tell what may
be the damages recoverable."
The
remaining member of the Court, Kay LJ, at 285-289, agreed with this general
proposition, but dissented from the Court's decision to discontinue the
interlocutory injunction on three grounds: first, the alleged libel was
expressed in such a way as to suggest it was motivated by spite rather than to
protect the interests of the public; second, the defendant had failed to rebut
a strong prima facie case on the evidence that the libel was untrue; and third,
the balance of convenience and inconvenience favoured the continuance of the
temporary restraint since it would cause little harm to the defendant not to
publish the alleged libel and much damage to the plaintiff pending the outcome
of the trial. The first and third of those grounds do not accord with the
majority's reasoning or the courts' application of the
Bonnard
v. Perryman
rule ever since.
More
recent authorities acknowledge the strength of the rule and continue to
articulate the two associated reasons for it to which I have referred, though
not always giving the same relative importance to each.
In
Fraser
v. Evans
[1969] 1 All E.R. 8, CA, Lord Denning MR, at 10, gave primacy to the right of
freedom of speech:
"The
Court will not restrain the publication of an article, even though it is
defamatory, when he defendant says that he intends to justify it or to make
fair comment on a matter of public interest. This has been established for
many years since Bonnard
v. Perryman. The reason sometimes given is that the
defences of justification and fair comment are for the jury, which is the
constitutional tribunal, and not for the judge; but a better reason is the
importance in the public interest that the truth should out. ...
There
is no wrong done if it [the alleged libel] is true, or if it is fair comment on
a matter of public interest. The court will not prejudice the issue by
granting an injunction in advance of publication."
To
similar effect, though in another context,
[4]
is the following passage from the judgment of Griffiths LJ in
Herbage
v. Pressdram Ltd.
[1984] 1 WLR 1160, CA, at 1162 F-H, when summarising a number of principles
generally applicable to the grant of interim injunctions in defamation actions:
*"...
no injunction will be granted if the defendant raises the defence of
justification. This is a rule so well established that no elaborate citation
of authority is necessary. It can be traced back to the leading case of
Bonnard
v. Perryman ...
These
principles have evolved because of the
value the court has placed upon freedom
of speech and I think also upon the freedom of the press, when balancing it
against the reputation of a single individual who, if wrong[ed], can be
compensated in damages."
In
Khashoggi
v. IPC Magazines
[1986] 1 WLR 1412, Sir John Donaldson MR emphasised the practicalities and the
limited role of the court at the interlocutory stage: He said, at 1417H-1418A:
"The
point is that Bonnard
v. Perryman, apart from its reference to freedom of
speech, is based on the fact that the courts should not step in to defend a
cause of action in defamation if they think that this is a case in which the
plea of justification might, not would, succeed."
The
Submissions
Mr.
William Bennett, on behalf of the defendant, submitted that:
-
the rationale of the
Bonnard
v. Perryman
rule is the individual's right of freedom of speech and of the public's right
to be informed, subject only to subsequent penalisation of the defendant in
damages if the libel is untrue;
-
the main allegation here is one of fraud, a matter on which Mr.
Smyth has the
right to speak and in which the public has an interest;
-
the only relevant consideration at the interlocutory stage is the possible
truth of the allegation;
and
-
therefore, the motive for the threatened defamatory statement is irrelevant.
He
submitted that the right of freedom of speech, underlined since 1953 in Article
10 of the European Convention for the Protection of Human Rights and
Fundamental Freedoms (1953)(Cmd. 8969) ("the Convention"), is of such
importance that it should not be eroded or qualified by the introduction of
other tests. As to the motive of a person in threatening to make a defamatory
statement, he said that it was irrelevant because it could not affect the
truthfulness of the statement or, hence, the entitlement to make it or the
public's interest in hearing it.
Miss
Presiley Baxendale, QC, on behalf of Mr.
Holley and the other plaintiffs,
submitted that:
-
the overriding test is that in Section 37(1) of the Supreme Court Act 1981 for
the grant of interlocutory relief, including libel cases, namely where "it
appears to the court to be just and convenient";
-
the
Bonnard
v. Perryman
approach is not an absolute rule against the grant of interlocutory relief
where the libel is possibly true, it is simply authoritative guidance for the
exercise of a discretion;
and
-
there is a discretion in an "exceptional" case to restrain a possibly true
libel.
Miss
Baxendale submitted that this is such a case. Like Mr. Bennett, she suggested
that the rationale of
Bonnard
v. Perryman
is the protection of the right of free speech. However, she argued that its
origin and main application have been in the context of threatened libel by the
media whose freedom to publish and inform the public is of particular importance.
[5]
She maintained that this case is not the usual one of a plaintiff seeking to
prevent adverse comment by the media; it is one of a defendant with an axe to
grind seeking to extract money from the plaintiff as the price of not
publishing his alleged wrongdoing. In short, her submission was that Mr.
Smyth
is not, by his threat to publish, asserting his right to free speech and is,
therefore, not entitled to the protection which
Bonnard
v. Perryman
normally provides.
The
Modern Authorities
There
are a number of comparatively recent authorities in which the courts have
expressly declined to restrain, as an exception from the general rule in
Bonnard
v. Perryman
,
a threatened libel intended or calculated to damage a plaintiff and made as a
means of putting pressure on him to compensate the defendant for some claimed
wrong.
In
Crest
Homes Limited v. Ascott
,
a decision of this Court given in 1975, but only reported in [1980] 6 FSR 396,
CA, a dissatisfied buyer of a house, having unsuccessfully sought compensation
from the builder, threatened to libel it with a
view to coercing it to make
compensation. The Court discharged an interlocutory injunction granted at first
instance restraining the libel. Lord Denning MR, with whom Stephenson and
Geoffrey Lane LJJ agreed, held that neither the arguably unreasonable mode of
the threatened libel nor the pecuniary motive for it was sufficient to take the
case outside the general rule established by
Bonnard
v. Perryman
.
Geoffrey Lane LJ, in his short concurring judgment at 399, emphasised the
strength of that general rule. He said:
"
... the line of authorities is long and weighty that interlocutory injunctions
in these cases will not be granted unless the plaintiff shows that the defence
of justification will not succeed; ..."
And
he applied the rule notwithstanding his
view that the defendant had chosen "a
vulgar and offensive way to air his grievances" and that "[t]he damage to the
plaintiffs was likely to be extensive and plainly difficult to prove".
In
Bestobell
Paints Limited v. Bigg
[1975] FSR 421, Oliver J., following
Crest
Homes
,
declined to restrain a dissatisfied buyer of paint who, with a
view to
obtaining compensation from the seller, threatened to libel it. He held, at
434-436, that the fact that the buyer may have been malicious or that his
object was to put pressure on the seller to settle his claim was irrelevant.
Lastly,
in
Mohamed
Al Fayed & Ors. v. The Observer Limited
,
The Times, 14th July 1986, Mann J. declined to treat as an exception to the
general rule Mr. Al Fayed's contention, assuming its truth, that the Observer
had abused its right to freedom of speech by waging a persistent and
irresponsible campaign against him as part of a
vendetta by a commercial rival
for the control of Harrods Limited long after the public had lost interest in
the matter. He held, after reviewing the authorities, that the only exception
to the general principle is where the allegation is "manifestly untrue" and
that it applies whatever the motive or reason for the threatened publication.
I
should also consider Article 10 the Convention. It provides, so far as
material:
"1 Everyone
has the right to freedom of expression. This right shall include freedom ...
to receive and impart information ... without interference by public authority
...
2. The
exercise of these freedoms, since it carries with it duties and
responsibilities, may be subject to such formalities, conditions, restrictions
or penalties as are prescribed by law and are necessary in a democratic
society, ... for the prevention of ... crime, ... for the protection of the
reputation or rights of others ..."
In
A-G.
v. Guardian Newspapers (No. 2)
[1990] 1 AC 109, HL, Lord Goff said at, 283E-284A, that Article 10 is
consistent with English law and should guide the interpretation of English law
when the latter permits. He referred to the restrictions on the right to speak
freely stated in the Article, including those "prescribed by law and ...
necessary in a democratic society", and observed:
"It
is established in the jurisprudence of the European Court of Human Rights that
the word 'necessary' in this context implies the existence of a pressing social
need, and that interference with freedom of expression should be no more than
is proportionate to the legitimate aim pursued. I have no reason to believe
that English law, as applied in the courts, leads to any different conclusions."
The
criteria of "pressing social need" and proportionality, derived from the
jurisprudence of the European Court of Human Rights,
[6]
for any exception to the general right of freedom of speech are of a piece with
the rationale of the English courts' rigorous application of the
Bonnard
v. Perryman
rule over the last hundred years. Hoffmann LJ has recently underlined it in a
different context in
R
v. Central Television Plc
[1994] 3 WLR 20, CA, at 30A-F:
"
The
motives which impel judges to assume a power to balance freedom of speech
against other interests are almost always understandable and humane on the
facts of the particular case before them. Newspapers are sometimes
irresponsible and their motives in a market economy cannot be expected to be
unalloyed by considerations of commercial advantage. Publication may cause
needless pain, distress and damage to individuals or harm to other aspects of
the public interest. But a freedom which is restricted to what judges think to
be responsible or in the public interest is no freedom. Freedom means the
right to say things which 'right-thinking people' regard as dangerous or
irresponsible. This freedom is subject only to the clearly defined exceptions
laid down by common law or statute.
Furthermore,
in order to enable us to meet our international obligations under the
Convention ..., it is necessary that any exceptions should satisfy the tests
laid down in article 10(2). They must be 'necessary in a democratic society'
and fall within certain permissible categories ...
It
cannot be too strongly emphasised that outside the established exceptions, or
any new ones which Parliament may enact in accordance with its obligations
under the Convention, there is no question of balancing freedom of speech
against other interests. It is a trump card which always wins."
Conclusions
In
my judgment, the authorities establish the following propositions.
The
courts' power to grant interlocutory relief to restrain a libel is discretionary,
[7]
but it is a discretion that must be exercised with great caution.
The
discretion to grant such relief is guided by the statutory constraint in
Section 37(1) of the Supreme Court Act 1981 that it should be exercised only
where "it appears to the court to be just and convenient to do so".
Where
there is a defence or claim of justification the discretion is further guided
by the rule in
Bonnard
v. Perryman
that it is not normally just or convenient to grant relief unless the plaintiff
has proved that the libel is plainly untrue.
There
is no jurisprudential basis for confining the
Bonnard
v. Perryman
rule or its rigour to threatened publication by the media. The authorities to
which I have referred show that it is not so confined. And, as Hoffmann LJ
observed in
Central
Television
,
the media's motivation for publication is rarely restricted to the altruistic
one of informing the public of matters in which it, the public, has an
interest. There is usually the additional driving force of commercial
self-interest, sometimes accompanied by obsessive
vindictiveness and/or
irresponsibility. Yet the authorities show that the presence of one or more of
those factors does not deprive the media of the protection of the rule. Why
then should those outside the media be subject to more stringent control
because they may have a motive other than the pure one of disseminating truth?
There
may be exceptions to the general rule, but neither the would-be libeller's
motive nor the manner in which he threatens publication nor the potential
damage to the plaintiff is normally a basis for making an exception.
Motive
is logically irrelevant to the defendant's entitlement to exercise his right to
freedom of speech if what he has to say is or may be true. In particular,
English jurisprudence has rejected as candidates for exception motives of
vindictiveness or pecuniary gain. The fact that Mr.
Smyth has expressly made
the implementation of his threat conditional on the plaintiffs' failure to pay
the money he claims does not distinguish it from the authorities where
motivation other than a simple desire to speak freely has been held to be
irrelevant. It is a fallacy to attempt to distinguish it on the basis that Mr.
Smyth's aim is not to exercise his right of freedom of speech, but to extract
money from another as the price of silence. The subject matter of the
application for interlocutory relief is his threat to speak freely, albeit that
it is contingent on the plaintiffs not meeting his possibly justified demand.
It is that threat, not the equally contingent offer to remain silent, that the
plaintiffs seek to restrain. The fact that he may have expressly offered to
remain silent if the plaintiffs met his demand does not, in my
view,
distinguish this case from the clearly implied threat to like effect in
Crest
Homes
and the other two recent authorities to which I have referred. There is
nothing unusual in an aggrieved person seeking what he considers to be his due
by threatening to resort to the media if his claim is not met while hoping that
it will not be necessary.
Article
10(2) of the Convention, in its general provisions for qualification of the
right to speak freely "for the prevention of crime" and "for the protection of
the reputation or rights of others", does not identify for me any "pressing
social need" for a different approach in the circumstances of this case. As
to the prevention of crime, I reject the notion that Mr.
Smyth's threat to
libel deserves consideration as an exception because it may be criminal as an
offence of blackmail. In my
view, save in the most exceptional case - which
this is not - it would be wrong in interlocutory civil proceedings to deny a
defendant his right to publish on the basis of what would at best be a
contingent finding of criminality on incomplete evidence and without the normal
rigour of the criminal process.
[8]
Certainly, I would not feel able to express a
view, on the material before me,
that, in the words of Section 21(1) of the Theft Act 1968, defining blackmail,
Mr.
Smyth made "an unwarranted demand with menaces" in that he did not believe
that he had "reasonable grounds for making" the threat or that it was "a proper
means of reinforcing the demand". The whole thrust of his case is that he was
seeking to regain money to which he or the trust in his name was entitled. I
note that Oliver J. in
Bestobell
was similarly unimpressed by such a suggestion of criminality. He said, at 424:
" There
can be no doubt whatever - and indeed it is not suggested otherwise - that this
threat was intended to put pressure on the plaintiffs to settle the defendants'
claim. Mr. Aldous, who appears for the plaintiffs, has described it as
blackmail, but it would, I think, be better to avoid such pejorative
expressions until the facts have been fully established at the trial."
As
to the Convention's protection of the reputation or rights of the plaintiffs,
this is simply an acknowledgement as applied to this country of its right to
protect its citizens against defamation, as it does by statute and established
jurisprudence of which the
Bonnard
v. Perryman
rule is part.
Similarly
as to the manner of the threatened publication, I can see no basis for any
material distinction of it from that in the general run of authorities where
the courts have declined to rely on the suggested unreasonableness or
disproportionate nature of the threatened conduct of the defendant as a reason
for making an exception to the general rule.
Finally,
there is the question of the potential damage to the plaintiffs if the relief
is not continued - a matter relied on by Ian Kennedy J.. Despite Hoffmann LJ's
broad statement in
Central
Television
,
that "outside the established exceptions" and any new statutory ones, freedom
of speech "is a trump card which always wins", it seems to me that the ultimate
equitable discretion of the court behind the rule in
Bonnard
v. Perryman
,
allows for the possibility of an exception being made for such a reason.
However, that possibility does not sit easily with the rationale of the rule or
with the more general constraints of Article 10 of the Convention, both of
which require great caution before interfering with the individual's right to
speak freely before there is a final determination on the matter as provided by
law. No doubt that is why the courts appear to have accepted up to now that the
Anerican
Cyanamid
[9]
principles governing the grant of interlocutory relief do not apply to
defamation cases where the
Bonnard
v. Perryman
rule is in play. See e.g. per Griffiths LJ in
Herbage
v. Pressdram Limited
,
at 1162G-H. Whatever the correct analysis of that approach, I can see no basis
for regarding the potential damage to the plaintiffs here as of such an
exceptional nature or gravity to take the case outside the general rule.
Accordingly,
I am of this
view that Ian Kennedy J's reasons for the exercise of his
discretion to grant relief were wrong and that the circumstances of this case
do not justify the Court in regarding it as an exception to the application of
the general rule. If Mr.
Smyth's allegations are true, he is entitled to
publish them, or to threaten to publish them, regardless of his motive or of
the damage such publication would or may do to the plaintiffs. Unless it can
be shown at this interlocutory stage that they are plainly untrue, the scheme
of the law is that he should not normally be deprived in the meantime of an
entitlement which he may subsequently establish. If he succeeds in doing so,
his motive continues to be irrelevant, if he fails then the law will require
him to compensate the plaintiffs and his motive may be punished by an award of
aggravated damages; see
Rookes
v. Barnard
[1964] AC 1129, HL, per Lord Devlin at 1221, a head of damages that the
plaintiffs have included in their claim.
Whether
the threatened libel is manifestly untrue
The
matter does not end there because Mr.
Holley and the other plaintiffs maintain,
by a Respondents' Notice and in reliance on further evidence, that Mr.
Smyth's
claim of justification is plainly untrue. Ian Kennedy J. rejected that
contention, holding that the plaintiffs' evidence did not "remotely come with
the certainty" of untruth required for the grant of interlocutory relief.
The
plaintiffs have put before this Court further affidavit evidence suggesting
that Mr.
Smyth was not deceived in that he knew at or before the material time
that there was a potential problem with the title to the land. Mr.
Smyth also
swore another affidavit complaining of the third and fourth plaintiffs'
continuing failure to investigate his complaints properly.
Miss
Baxendale submitted that, despite the conflicting evidence, the Court could now
be sure of the untruth of Mr.
Smyth's plea of justification. She relied on the
following matters:
-
his motive for threatening publication was an attempt to secure a price for his
silence and, therefore, reflected adversely on his credibility;
-
there were inconsistencies in his claims which pointed to his lack of
credibility;
-
his allegations of fraud and/or of fraudulent misrepresentation against the
first and second plaintiffs were not clearly pleaded or not sufficiently
particularised;
-
there were indications in the evidence, in particular, the further evidence put
before this Court by the plaintiffs, that Mr.
Smyth knew at the material time
that the investment was not "gilt-edged";
-
that the investment may yet prove to be sound;
and
-
that the complaints against the third and fourth plaintiffs of indifference to
the alleged fraud were plainly untrue because there was exhibited documentary
evidence that they were investigating them.
In
my
view, on the material before the Court, none of those matters would entitle
it to conclude, differently from Ian Kennedy J., that Mr.
Smyth's threatened
publication is plainly untrue. The arguments as to credibility must clearly
await the final determination of the matter by a jury. As to the reliance on
the suggested inadequacy of Mr.
Smyth's pleaded case, in particular in his
particulars of justification, my
view is that, regardless of any technical
deficiencies of pleadings beloved of libel lawyers, his make plain, as does his
evidence on affidavit, that he is alleging that the first and second plaintiffs
fraudulently misrepresented to him the position as to the title to the land.
As Mr. Bennett submitted, the important matter at this stage is what evidence
there is before the court to establish that a claim of justification is untrue,
not whether that claim is pleaded properly.
Accordingly,
I would allow Mr.
Smyth's appeal and dismiss the plaintiffs' cross appeal and,
accordingly, discharge the order of Ian Kennedy J.
SIR
CHRISTOPHER SLADE: I have had the advantage of reading the judgments of Lord
Justice Staughton and Lord Justice Auld in draft. Having done so, I find
myself in agreement with Lord Justice Auld, for the reasons given by him, that
the circumstances of this case did not justify Mr Justice Ian Kennedy in
regarding it as an exception to the application of the rule in
Bonnard
v Perryman
[1891] 2 Ch 269 C.A. and in accordingly granting the plaintiffs interlocutory
relief in the exercise of his discretion. I will for the greater part restrict
my observations to explaining why, with all respect to Lord Justice Staughton,
I am unable to agree with his opinion that the Judge's decision can be
supported on the grounds that the defendant's conduct amounted to the demanding
of money with menaces and might in due course be shown to have been an
"unwarranted" demand with menaces, constituting a criminal offence within
section 21 of the Theft Act 1968.
That
section, so far as material, provides:
"(1) A
person is guilty of blackmail if with a
view to gain for himself or another or
with intent to cause loss to another he makes any unwarranted demand with
menaces; and for this purpose a demand with menaces is unwarranted unless the
person making it does so in the belief -
(a) that
he has reasonable grounds for making the demand; and
(b) that
the use of menaces is a proper means of reinforcing the demand.
(2) The
nature of the act or omission demanded is immaterial, and it is also immaterial
whether the menaces relate to action to be taken by the person making the demand.
..................................."
The
editors of
Archbold
Criminal Pleading Evidence and Practice
(1997 Edition) summarise the effect of the section as follows:
"Any
demand with menaces is unwarranted unless the defendant is able to bring
himself within both paragraphs (a) and (b) of section 21(1). Thus the
essential nature of the offence is that the accused demands with menaces when
he believes he is not entitled to the thing demanded or when he believes the
use of menaces is improper notwithstanding his genuine claim. It appears to
follow from this that a claim of right cannot be a defence as such to a charge
of blackmail".
I
would be inclined to accept that a plaintiff who
on
the evidence
both put forward and established a triable case that the defendant, in
threatening to publish a statement defamatory of the plaintiff, was guilty of
the criminal offence of blackmail, could successfully argue that this situation
constituted an exception to the rule in
Bonnard
v Perryman
,
even though the defendant proclaimed his intention to justify the statement.
The Court in
Bonnard
v Perryman
was not directing its mind to such circumstances; and I agree with Lord Justice
Staughton that Article 10 of the European Convention for the Protection of
Human Rights and Fundamental Freedoms, which deals with freedom of expression,
would not preclude the Court from intervening for the purpose of protecting the
plaintiff in a libel action from an apparent breach by the defendant of the
criminal law.
In
the present proceedings, however, at least until the suggestion was floated in
the course of argument by this Court itself, it has, I believe, never been part
of the plaintiffs' case that the defendant's threats to publish constituted
blackmail or any other criminal offence. My understanding is that no such
contention was advanced in the Court below. Nor is it advanced in the
respondents' skeleton argument and respondents' notice addressed to this Court.
We have no evidence before us specifically directed to the question whether or
not the defendant's demands were "unwarranted" within the meaning of section 21
of the Theft Act 1968. He has had no opportunity of refuting that suggestion
by adducing evidence to show that he can bring himself within the exempting
provisions of paragraphs (a) and (b) of the section.
In
these circumstances, the possibility of the defendant's threats constituting
the criminal offence of blackmail is not in my judgment a factor which we would
be entitled to take into account in deciding whether or not to continue the
injunction granted by Mr Justice Ian Kennedy. We are bound to approach this
appeal on the footing that the defendant's threats to publish the relevant
statements, albeit defamatory, were perfectly lawful, provided only that he
could justify them.
The
Judge himself did not suggest that the defendant's threats to publish were
unlawful. However, he considered that he could not successfully invoke the
rule in
Bonnard
v Perryman
,
essentially on the grounds that his motive in threatening to publish was not to
tell the world that which as "the assumed guardian of the truth" he thought the
world ought to know; it was the less high-minded motive of obtaining, as the
price of his silence, the recompense which he considered to be owed by the
plaintiffs.
Even
in the absence of authority, I would have been disposed to hold that in a case
where a defendant proposes to publish information which he asserts he can
justify, the Court should not depart from the rule in
Bonnard
v Perryman
merely because it regards his motives in the proposed publication as less
high-minded than the pure desire to let the world know the truth. In many,
perhaps most, cases the motives for the intended publication may be mixed and
inquiry into motive, particularly on an interlocutory application, may be a
somewhat speculative exercise. Under the general law the defendant's motives
ordinarily afford no sufficient grounds for restraining him from exercising a
legal right.
In
my opinion, however, the authorities cited by Lord Justice Auld, themselves
establish that neither the would-be libeller's motive nor the manner in which
he threatens publication nor the potential damage to the plaintiff is normally
a basis for making an exception to the rule. I will merely refer briefly to
three of these authorities.
In
Bonnard
v Perryman
itself, as Kay L.J. pointed out in his dissenting judgment (at p. 285), the
alleged libel was "expressed in coarse and abusive language which would incline
any one reading it to the belief that some personal feeling of spite or
malignity against the plaintiffs, and not merely a desire to protect the
interests of the public was among the actuating motives of the defendant".
In
Bestobel
Paints Limited v Bigg
1975 F.S.R. 421, there was no doubt whatever that the defendant's threat was
intended to put pressure on the plaintiffs to settle his claim; indeed the
plaintiffs' counsel described the threat as "blackmail" (though the judgment
makes it clear that, as in the present case, the accuracy or otherwise of that
description was not tested in argument: see at p. 424). Oliver J. nevertheless
declined to grant interlocutory relief. In the course of a comprehensive
review of the authorities he said (at p. 434):
"It
has never, so far as I know, been suggested that, in the ordinary case of
libel, it makes any difference to the grant or withholding of interlocutory
relief that the defamatory statement is alleged to have been published
maliciously".
In
Crest
Homes Ltd. v Ascott
(1980) F.S.R. 396 the Court of Appeal clearly did not consider that the fact
that the relevant statement was calculated to damage the plaintiffs in their
business and was made with a
view to putting pressure on them to settle the
defendants' claim for compensation took the case out of the rule in
Bonnard
v Perryman
.
Lord Denning MR (at p. 398) said explicitly:
"Next
[plaintiffs' counsel] said that it was done so as to get [the plaintiffs] to
give compensation. The defendant ought to have brought an action and not acted
in that manner. That may be so but nevertheless it is not sufficient to take
the case out of the general rule".
I
accept that the Court may be left with a residual discretion to decline to
apply the rule in
Bonnard
v Perryman
in exceptional circumstances. One exception, recognised in that decision
itself, is the case where the Court is satisfied that the defamatory statement
is clearly untrue. In my judgment, however, that is a discretion which must be
exercised in accordance with established principles. In my judgment, Mr
Justice Ian Kennedy acted contrary to established principles in regarding the
defendant's supposed motives in the present case as constituting exceptional
circumstances sufficient to justify his declining to apply the rule.
I
now turn briefly to consider the respondents' notice, in which it is contended
that the Judge's decision should be affirmed on grounds other than those relied
on by him, namely:
"1. The
defendant's evidence failed to put forward even a minimally particularised or
reasoned case that there had been fraud by any of the plaintiffs or any "key
personnel" of the third or fourth plaintiffs on that the third and fourth
plaintiffs had failed to act in relation to the defendant's alleged concerns
about alleged fraud.
2. The
defendant's libellous allegations against the plaintiffs were accordingly not
even arguably justified ...".
Bonnard
v Perryman
itself and many subsequent authorities show that the burden falling on a
plaintiff is a heavy one, if he seeks to satisfy the Court that the rule should
not be applied on the grounds that the defendant's proposed plea of
justification cannot succeed; the falsity of the relevant allegations must be
clearly shown:
In
paragraph 40 of an affidavit sworn on 30th May 1997, the defendant explicitly
acknowledged that
"it
would be inappropriate to make allegation as to the committing of any fraud or
other wrongdoing by either of the third or fourth plaintiffs .... My
complaints at those two companies are limited to their failure now to act,
given their control of the second plaintiff, to remedy the matters at which I
now complain .... I am happy to confirm my undertaking to the Court not to
make or publish any statement implying their involvement in any fraudulent or
other wrongful activity ..."
In
this context therefore, I regard the relevant question as being whether the
evidence discloses triable issues in regard to the defendant's claims that (a)
there has been fraud on the part of the first and second plaintiffs and (b) the
third and fourth plaintiffs have failed to act in relation to the defendant's
asserted concerns about such fraud. In agreement with the Judge and Lord
Justice Auld, I consider that triable issues have been shown on both these
points. Without overlooking Miss Baxendale's careful and intricate submissions
in this context, I do not think a detailed examination of the evidence at this
stage would be helpful. These are issues which will have to be explored in
depth at the trial.
In
the result, I would for my part seek an undertaking from the defendant broadly
in the form which he has already offered and to which I have referred. Subject
to that, in agreement with Lord Justice Auld, I would allow the defendant's
appeal, dismiss the plaintiff's cross-appeal and discharge the order of the
Court below.
ORDER:
Appeal allowed with costs. Leave to appeal to the House of Lords refused.
[ ]1
before the Act the fact of publication and the truth of innuendoes were
questions for the jury.
[ ]2
In
Monson
v. Tussauds Ltd.
[1894] 1 QB 671, Lopes LJ said, at 693, that Lord Esher MR's judgment
"underl[ay] every subsequent decision on the subject".
[ ]3
See also
Quartz
Hill Consolidated Gold Mining Company v. Beall
(1888) 20 Ch.D 501, per Sir George Jessel at 508.
[ ]4
namely the issue of lack of malice as part of a defence of justification for
the publication of "spent" convictions; see the Rehabilitation of Offenders
Act 1974, sections 4(1) and 8(5).
[ ]6
The Observer & the Guardian v. United Kingdom
(1991) 14 EHRR 153, at 191, paragraph 59: Exceptions "must be narrowly
interpreted and the necessity for any restrictions must be convincingly
established." See also
Thorgeirson v. Iceland
(1922) 14 EHRR 843, at 865, paragraph 63.
[ ]7See
Spry, "Equitable Remedies", 1st ed. (1971) pp. 21-23
[ ]8
Cf. the similar approach in cases of civil conspiracy:
Gulf
Oil (G.B.) Ltd v. Page
[1987] Ch 327, per Ralph Gibson LJ at 334; and
Femis-Bank
(Anguilla) Ltd. v. Lazar
[1991] Ch 391, per Sir Nicholas Browne-Wilkinson at 400F-401E.
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