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Cite as: [2001] EWHC QB 389

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Hamilton v. Mohamed Al Fayed and Ors [2001] EWHC QB 389 (13th July, 2001)

Case No: 1998-H-No.17

IN THE HIGH COURT OF JUSTICE

QUEENS BENCH DIVISION

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 13th July 2001

(Handed Down)

B e f o r e :

THE HONOURABLE MR JUSTICE MORLAND

 

Mostyn Neil Hamilton

Claimant

 

- and -

 
 

Mohamed Al Fayed

Defendant

 

- and -

 
 

(1) Sir Roberth McAlpine Ltd

(2) Lord Hanson

(3) Mr Richard Clay

(4) The Duke of Devonshire

(5) Mr Christopher Sharples

(6) Mr David Wills

(7) Mr Taki Theodoracopulos

(8) The Earl of Portsmouth

Respondents

(to costs)

Mr James Price Q.C. and Mr Laurence Harris (instructed by D.J. Freeman for the Defendant)

Sir Sydney Kentridge Q.C. and Mr Simon Salzedo (instructed by Mishcon De Reya for Respondents (1) & (2))

Mr David Lloyd-Jones Q.C and Mr Alan Maclean (instructed by Russell, Jones & Walker for Respondents (3) (4) (5) and (6))

Mr Philip Heslop Q.C. and Mr Orlando Fraser (instructed by Peters & Peters for Respondent (7))

Mr John Wardell (instructed by Forsters for Respondent (8))

I direct that pursuant to CPR PD 39A para 6.1. no official shorthand note shall be taken of this judgment and that copies of this version as handed down (subject to editorial correction) may be treated as authentic

 

The Hon. Mr Justice Morland.

    Mr Justice Morland :

 

Reasons for Judgment.

  1. On the 20th June 2001 I dismissed applications by Mr Al Fayed for orders for costs under Section 51 of the Supreme Court Act against the respondents, some of the contributors towards Mr Hamilton's costs in his unsuccessful libel action against Mr Al Fayed in whose favour the Jury returned a verdict on the the 21st December 1999. I gave judgment for the respondents with costs stating that I would give detailed reasons for my conclusion, that it would be unjust and unreasonable to make any order for costs in favour of Mr Al Fayed against any of the respondents, at a later date in deference to the arguments of counsel and the suggestion that my judgment may have wider implications in the current situation with regard to the funding of Civil Litigation.
  2. Section 51 now reads:-
  3. "(1).....the costs of and incidental to all proceedings in - ... (b) the High Court......

    shall be in the discretion of the Court. ........

    (3) The Court shall have full power to determine by whom and to what extent the costs are to be paid."

  4. Pursuant to C.P.R. Part 48.2(1)(a) the respondents were added as parties for the purposes of costs only, in addition to Mr Hamilton and Mr Al Fayed, which brought into play C.P.R. Part 44.3 which sets out the Court's discretion and circumstances to be taken into account when exercising its discretion as to costs
  5. "C.P.R. 44.3

    (1) The court has discretion as to-

    (a) whether costs are payable by one party to another;

    (b) the amount of those costs; and

    (c) when they are to be paid.

    (2) If the court decides to make an order about costs-

    (a) the general rule is that the unsuccessful party will be ordered to pay the costs of the successful party; but

    (b) the court may make a different order,

    (4) In deciding what order (if any) to make about costs, the court must have regard to all the circumstances including-

    (a) the conduct of all the parties;

    (5) The conduct of the parties includes-

    (a) conduct before, as well as during, the proceedings, and in particular the extent to which the parties followed any relevant pre-action protocol"

  6. Lord Goff said in Aiden Shipping Ltd v. Interbulk Ltd [1986] A.C. 965 at page 975 considering Section 51 as originally enacted:-
  7. "The subsection simply provides that "the court shall have full power to determine by whom... the costs are to be paid."Such provision is expressed in wide terms, thus ensuring that the court has, so far as possible, freedom of action, leaving it to the rule-making authority to control the exercise of discretion (if it thinks it right to do so) by the making of rules of court, and to the appellate courts to establish principles upon which the discretionary power may, within the framework of the statute and the applicable rules of court, be exercised. Such a policy appears to me, I must confess, to be entirely sensible. It comes therefore as something of a surprise to discover that it has been suggested that any limitation should be held to be implied into the statutory provision which confers the relevant jurisdiction."

     

  8. The implied limitation contended for was that the jurisdiction was limited to a "party to the proceedings".
  9. Lord Goff said further at page 980
  10. "In the vast majority of cases, it would no doubt be unjust to make an award of costs against a person who is not a party to the relevant proceedings. But, as the facts of the present case show, that is not always so. In the present case, the two originating motions were heard together without any formal order being made, but in such a case, and also in a case where a formal order has been made, one reason why that course of action is taken may be to achieve a saving of costs

    and at page 981

    "I do not, for my part, foresee any injustice flowing from the abandonment of that implied limitation, Courts of first instance are, I believe, well capable of exercising their discretion under the statute in accordance with reason and justice. I cannot imagine any case arising in which some order for costs is made in the exercise of the court's discretion, against some person who has no connection with the proceedings in question. If any problem arises, the Court of Appeal can lay down principles for the guidance of judges of first instance; or the Supreme Court Rule Committee can propose amendments of the Rules of the Supreme Court for the purpose of controlling the exercise of the statutory power vested in judge subject to rules of court."

  11. Before considering the guidance given by the Court of Appeal and the detailed submissions of Counsel I shall summarise some of the important facts germane to all the applications against the respondents.
  12. The Factual Background

  13. On the 20th October 1994 The Guardian published the article "Tory MP's were paid to plant questions, says Harrods chief". That became the subject of the Guardian libel action brought by Ian Greer and Mr Hamilton which was withdrawn on the 30th September 1996 the day before the trial was due to start before myself, the reason being that a conflict of interest had arisen between Ian Greer and Mr Hamilton.
  14. On the 19th February 1997 Sir Gordon Downey made his report to the Standards and Privileges Committee of the House of Commons which condemned Mr Hamilton for failing to register interests but not for corruption on the 5th November 1997.
  15. Meanwhile on the 16th January 1997 the defamatory words complained of by Mr Hamilton had been uttered by Mr Al Fayed in the "Dispatches" programme on Channel 4. At the libel trial it was agreed that the words complained of had this defamatory meaning "that Mr Hamilton had corruptly demanded or accepted cash payments and other financial benefits in return for tabling parliamentary questions and other parliamentary services". Mr Hamilton has always protested his innocence and in particular denied receiving "cash for questions".
  16. Mr Hamilton wished to clear his name. The problem was the likely cost. He had no income. His career as a Member of Parliament was finished. His only significant asset was his interest in the matrimonial home in Cheshire. His opponent, Mr Al Fayed, was a man of apparently unlimited wealth, a man very unlikely to retract his accusations, and a man who would spare no expense in defending any claim. In the event Mr Al Fayed for the trial retained highly experienced and competent specialist Solicitors in defamation work who instructed specialist junior counsel of 16 years call, a specialist silk of 4 years standing, both led by the redoubtable George Carman Q.C., the greatest jury advocate of his time, all backed by the latest technology. At trial and throughout preparations for trial Mr Hamilton achieved a very substantial degree of "equality of arms" by way of legal representation enabling him to have a fair hearing in accordance with Article 6 of the Convention. How did this come about?
  17. The costs of a defamation case which may proceed to a full trial are daunting even for the most determined litigant believing in his own innocence in his quest to clear his name. In Gatley on Libel and Slander (9th Edition) at paragraph 24.2 is written:-
  18. "Risks. The only person who can contemplate with equanimity bringing an action for libel or slander is one with ample means, who reputation is unblemished, whose past contains no skeletons, and whose complaint is of a damaging and clear public misstatement of a special fact....Legal aid is not available for proceedings wholly or partly in respect of defamation, and the proceedings, whether interlocutory, at the trial, or on appeal, tend to be complex. In 1972 it was said that the aggregate bill that an unsuccessful party would have to bear in the case of Broome v. Cassell might be more than £60,000: (in Nixon v. Channel Four) in June 1997 a plaintiff agreed to pay a defendant £765,000, representing 80 per cent of the defendant's costs assessed on the standard (not indemnity) basis, as a term of an agreement by which he was permitted to discontinue his action after several weeks of trial. Such burdens result not only from prolonged inquiries into difficult facts, but often also reflect the uncertainties of the law and disagreements between judges for which the unsuccessful litigant is expected to pay. Even a successful party will find that he has incurred substantial costs which cannot be recovered from his opponent on taxation."

  19. It is to be noted that Nixon v. Channel Four was tried before myself without a Jury and discontinued during the cross-examination of the claimant who had been dubbed a professional charlatan. At the inception of Mr Hamilton's claim Contingency Fee Arrangements were not lawful. Even if they had been it is highly unlikely that specialist solicitors and counsel would have embarked on a contingency basis on a case of this magnitude. It would not only be a question of cost but also of time. In the event Mr Al Fayed obtained a default costs certificate against Mr Hamilton in the sum of £1,467,576.08. under C.P.R. Part 47.11. Mr Hamilton did not raise any dispute on Mr Al Fayed's Bill of Costs. If I had intended to make orders against any respondent in amounts substantially more than their contributions towards Mr Hamilton's costs, I would have permitted them to serve points of dispute and be heard in detailed assessment proceedings under C.P.R. Part 47.9(3).
  20. In an affidavit dated the 24th March 1999 made in support of an application for a costs order in relation to an appeal by Mr Al Fayed to the Court of Appeal that Mr Hamilton's action be stayed because it involved an infringement of parliamentary privilege, Mr Hamilton after stating that his home in Cheshire was worth about £775,000 said:-
  21. "Mrs Hamilton and myself own the property as joint tenants. It is burdened with a mortgage to the value of £75,000. I owe debts in the sum of £40,000 to my father, £23,828.81 to Crocker Oswald Hickson on account of work done prior to the commencement of these proceedings, and approximately £30,000 to Messers Peter Carter Ruck and Partners in respect of costs incurred in mounting the libel action against The Guardian"

  22. In my judgment that was Mr Hamilton's financial position when he commenced proceedings a year earlier.
  23. The Fund

  24. The idea of a "Neil Hamilton Fighting Fund" was conceived by Lord Harris of High Cross who had known Mr Hamilton since he was a student at Aberystwyth University in 1970. In his written statement Lord Harris explained how the fund was run, his contact with Mr Rupert Grey, Mr Hamilton's Solicitor, and his understanding of the risk of donors to the fund being held liable to a costs order in favour of Mr Al Fayed.
  25. I quote from parts of that statement:-
  26. "Mr Hamilton told me that the only solution to his predicament was for him to bring a libel action against the defendant in relation to the defendant's allegations of corruption made on a Channel Four television programme. Mr Hamilton explained that, having incurred very substantial costs in a previous aborted libel action against the Guardian newspaper and having lost his livelihood as an MP, he could not afford the costs of legal action. He was therefore effectively deprived of a remedy.

    Mr Norris Mcwhirter agreed to assist me to raise money to help Mr Hamilton with his legal costs. I did not discuss with Mr Hamilton how the funds would be raised, save that he and I agreed that the identity of anyone who did support him would be kept confidential and not even Mr Hamilton would be told.

    Mr Hamilton asked me to speak to his solicitors Crockers Oswald Hickson, a firm of defamation specialists, about the likely amount of costs involved and the mechanics of paying them

    In or about November 1997, I spoke to Mr Rupert Grey, the partner in charge of Mr Hamilton's case

    I told Mr Grey that Mr McWhirter and I were proposing to raise funds from others to help pay for Mr Hamilton's costs and that we wished to know how much money might be needed. Mr Grey advised that a minimum of £150,000 should be raised before Neil Hamilton's Writ could be served. I agreed with Mr Grey that if sufficient funding "pledges" could be obtained, I would administer the fund and pay Crockers Oswald Hickson direct without involving Mr Hamilton.

    Mr Grey did not at that time mention the law of maintenance. I therefore gave no thought to the possibility that any donors who were effectively paying Crockers Oswald Hickson's fees might conceivably be liable to the defendant as maintainers.

    In late 1997 and early 1998, Mr McWhirter and I duly sought pledges of financial support in formal letters marked "strictly in confidence", initially from those known personally to us and subsequently from their friends and by a public appeal in the letters column of the Daily Telegraph. I kept Crockers Oswald Hickson advised of our progress in obtaining pledges which, by March 1998, totalled some £150,000.

    In April 1998, we began to call up the pledges to enable Mr Hamilton to serve the Writ. A bank account was opened at the NatWest in the name of the Neil Hamilton Fighting Fund. Cheques and other donations were paid into the account. Although I was the sole signatory of the account, my other commitments and lack of secretarial resources, made me rely heavily on the Fund's Honorary Secretary, Miss Sheila Childs, to carry out the administration from her office in Herefordshire. She banked all the cheques and dealt with the correspondence. By the end of the trial, the Fund received a total of 484 donations, most of which were of small sums from mostly unknown, scattered private individuals.

    To pay Crockers Oswald Hickson's costs, the practice was for Mr Grey to report from time to time of the amount of Mr Hamilton's estimated costs and to ask for money from the Fund to cover them. I would pass this information to Miss Childs, who held the chequebook, and she would make out the necessary cheques for me to sign and send to Crockers Oswald Hickson.

    In early April 1998, I was contacted by Mr Simon Heffer, a long-standing friend and journalist, who said he was acting as intermediary for a prospective donor who was prepared to make a major donation to the Fund but insisted on complete confidentiality.

    Mr Heffer, Mr Grey and I met at Crockers Oswald Hickson's offices on 21 April 1998. Mr Heffer explained that an important donor wanted a categorical assurance that by giving the money his identity would remain completely confidential and not be revealed under any circumstances. Mr Grey gave an emphatic and unequivocal assurance that the names of all the donors would remain totally confidential. He did not mention the law of maintenance directly but gave me to understand that there was nothing wrong or unlawful about making donations to the Fund.

    The issue of maintenance was expressly raised by the defendant's solicitors in their letter to Crockers Oswald Hickson dated 13 Jan 1999. Mr Grey copied it to me together with a copy of his letter in reply to the Defendant's solicitors dated 28th January 1999.

    I read the defendant's solicitors' letter which stated that the defendant intended to apply for a costs order against any party who had been funding or maintaining the action. The letter asked Crockers Oswald Hickson to identify those funding Mr Hamilton's costs, what their interest in the litigation was and whether they had been advised in writing that they may be liable to a costs order against them.

    I read Mr Grey's letter in response. I was impressed by his forthright dismissal of the defendant's letter. It was consistent with the assurance he had given on 21 April 1998. I understood from Mr Grey's letter that the legal authorities on the funding of litigation were entirely against the defendant and that the threat of a costs order was merely designed to destabilise the funding of Mr Hamilton's case. I relied on the contents of this letter as a succinct summary of the law. I therefore saw no reason to pass a copy of the defendant's solicitors letter of 13 January 1999 to any donor nor did I alert any of the donors to the warning contained in the letter

    During 1999, and up to and through the trial in November and December 1999, Mr Grey continued to advise me of the level of Mr Hamilton's costs and to encourage me to raise as much money as possible for the Fund. On none of these occasions did Mr Grey urge me or donors to take legal advice about the donations."

  27. The letters referred to by Lord Harris are D.J. Freeman's letter of the 13th January 1999 (Court bundle 2. tab 14 p.1-2) and Crocker's Letter of the 28th January 1999 (Court bundle 2. tab 14 p.3).
  28. The total amount received by Crockers was £466,320.81. from the Fund including £100,000 paid direct to Crockers by the Earl of Portsmouth. 21 contributors subscribed more than £5000 totalling £323,500. The identities of two of these contributors is unknown.
  29. The total number of donations to the Fund was 484 of which 308 were for £100 or less. Only about 25 donations exceeded £300. Clearly it would have been impracticable and disproportionate to allow S.51 applications to proceed in respect of donors below a certain arbitrary limit which I set at £5000.
  30. In October 1997 the "New Statesman" published an article by Lord Harris entitled "Justice Denied, The only serious corruption charge against Neil Hamilton is hollow." (Vol2.tab12.p.1). This article was later circulated to prospective donors.
  31. In January 1998 Lord Harris and Mr Norris McWhirter wrote to prospective donors the following letter enclosing a pledge form (Vol2.tab12.p.2-3)
  32. In a letter to The Times (8th December). John Major wrote:

    "It was unjust that the Committee on Standards and Privileges ended the examination into the Neil Hamilton affair without testing the evidence or calling Mr Mohamed Fayed to give evidence"

    The Committee's report said it could "neither add to nor subtract from "Sir Gordon Downey's report and failed to endorse or reject it. Mr Hamilton was thus left in limbo, condemned for supposedly taking cash in brown envelopes - on the testimony of Mr Fayed, supported by three long-serving employees or former employees

    The simple injustice is clear from Sir Gordon's failure to follow his own warning, based on a DTI inspector's report, that nothing Mr Fayed said should be believed "unless it was reliably corroborated by independent evidence of a dependable nature". It is surely significant that Martin Bell MP himself agrees Mr Hamilton "has been denied the elementary justice of having his accuser tested and cross-examined"

    After long consideration Mr Hamilton has concluded that he can escape his present limbo only by openly confronting his accuser in a court of law and inviting a jury to judge between their evidence given under oath. He has accordingly issued a writ for libel against Mr Fayed, as required within a year of the last repetition o the libel. To take effect, this writ must be served on Mr Fayed, which Mr Hamilton would hope to do in March - or sooner to expedite the process of clearing his name.

    Having lost his livelihood, he cannot proceed unaided. His solicitors (Crockers Oswald Hickson) advise that he should seek guarantees of not less than £150,000 before serving the writ. We have been encouraged over Christmas and New Year by 45 pledges of support totalling £80,000. In the hope of covering the balance of £70,000 mostly in modest sums of £500. £1,000 (or more), we are now writing to further friends and possible well-wishers inviting the completion of the enclosed pledge. If it proved necessary to call up part or all of the sum pledged, it would be on the strict understanding that success of the action would enable the money to be returned.

    Whilst the nature of this appeal may be made public, in no circumstances will the names of those approached - or their responses - be published (or even notified to Mr Hamilton) without permission in writing. Likewise, if you felt able to suggest names of others to whom we might send this appeal, your name would not be mentioned without your express permission (*see pledge form).

    Thank you for at least reading this far! If you are sympathetic but have specific doubts, we would be happy to try and answer them by phone or to send copies of supporting material"

  33. On the 29th January 1998 the "Daily Telegraph" published a letter from Lord Harris seeking contributions to the Fund entitled "Joust with Fayed" (Vol 2.tab12.p.4a). A repeated appeal was made to donors in May 1998 (Vol 2 tab12.p.5). Also in May 1998 a letter was sent to "friends of friends" in which Lord Harris said:-
  34. "Sir Gordon Downey condemned NH solely on the testimony of Fayed and his long-standing employees, thereby failing to follow his own warning based on the DTI Inspectors' reports that nothing Fayed said could be believed "unless reliably corroborated by independent evidence of a dependable nature". The Standards Committee's failure to examine Fayed on oath simply compounded the travesty of justice.

    Since then, Fayed's behaviour has made the charge he trumped-up at the last moment about "cash in brown envelopes" appear all the more transparent, as confirmed by the enclosed article by Paul Johnson from the Spectator. My own certainty of Neil's innocence on this most serious charge (based on knowing him intimately for 25 years) is set out in the New Statesman article which is also enclosed.

    He can escape from his present tragic limbo only by confronting his tormentor in court where a jury can judge between their sworn evidence. His solicitors (Crockers Oswald Hickson) have advised that his costs to get to the door of the court would be about £150,000 and a further £150,00-200,000 if Fayed dares to defend a libel action with a full-scale hearing. "

  35. Mr Hamilton's writ had been issued on the 9th January 1998 and served on the 30th April 1998. On the 29th May 1998 Mr Al Fayed applied that the action be dismissed or stayed as an infringement of parliamentary privilege. Mr Justice Popplewell dismissed that application on the 31st July 1998 with costs (Vol 2.tab 17a). For the hearing before Mr Justice Popplewell Crockers' Statement of Costs totalled £47,358.26 including disbursements, (Vol 2 tab 17c p.b).
  36. This was followed by a further letter by Lord Harris published in the "Daily Telegraph on the 6th August 1998:-
  37. "Readers who responded earlier this year to my appeal for Neil Hamilton's libel action against Mohamed Fayed will be encouraged by the latest turn of events. Having reached our initial target of pounds £150,000 we assumed Mr Fayed would welcome the opportunity to prove his allegations about "cash for questions" in the courts, which he told Sir Gordon Downey was "the right forum" for a verdict. Surprisingly, therefore, last week Mr Fayed tried to block Mr Hamilton's libel action by claiming that the parliamentary inquiry had removed the court's jurisdiction to hear it. In dismissing Mr Fayed's application with costs against him, Mr Justice Popplewell judged that the House of Commons did not endorse Sir Gordon's opinion (reached on different rules of procedure and evidence from a court) that Mr Hamilton had received cash payments from Mr Fayed. Furthermore, the judge concluded: "these allegations have not been determined in court, and until they have been, they remain what they are, allegations only." Although the judge refused leave to appeal, Mr Fayed has the power (and the financial resources) to apply to the Court of Appeal directly if he wishes to avoid cross-examination on oath. For readers who agree a full hearing alone would serve the public interest, I stand ready to oblige by receiving pledges of support for the "Neil Hamilton Fighting Fund"."

  38. In September 1998 Lord Harris wrote calling up the pledges in which he said (Vol 2 tab 12 p.10):-
  39. "Fayed may be expected to use his vast wealth and try every strategy to force the cost higher in the hope that Mr Hamilton will be forced to withdraw"

  40. Indeed Mr Al Fayed did appeal unsuccessfully the order of Popplewell.J. to the Court of Appeal who dismissed his appeal on the 26th March 1999 and then to the House of Lords, who having given him permission to appeal on the 15th July 1999, dismissed his appeal on the 7th October 1999 ( [2001] 1.A.C. 395). Although orders were made that the costs of the appeals should be taxed and paid forthwith to Mr Hamilton, Crockers' funds were at least temporarily substantially depleted and the trial was due to commence on the 15th November 1999.
  41. Lord Harris renewed his appeals for contributions. His letter dated October 1999 to contributors is in Vol 2 tab 12 p.12 and his letter published in the Daily Telegraph at page 15 saying:-
  42. "After two earlier unsuccessful attempts by Mohamed Fayed to block Neil Hamilton's libel action, the Law Lords have unanimously rejected his specious claim that the Downey report has removed the right of the courts to adjudicate on Mr Fayed's allegations against Mr Hamilton (report Oct.8)

    The way is therefore open for the libel case to be heard by a jury on Nov. 15 - for the first time with evidence taken under oath.

    Unfortunately, Mr Fayed's repeated, costly obstructions have depleted the substantial fighting fund that Norris McWhirter and I built up through the generosity of many supporters, including readers of the Daily Telegraph. Although costs (probably more than £250,000) have been awarded to Mr Hamilton in three judgments, a large part of the sum now due from Mr Fayed will not be paid before the trial begins.

    Accordingly, a final effort is needed to prevent Mr Fayed forcing his challenger to abandon the action for lack of funds.

    Last year, when Mr McWhirter and I launched the "Neil Hamilton Fighting Fund", we expressed the hope that eventual vindication of our friend would enable part or all of the contributions to be returned. In now appealing to the generosity of all well-wishers to contribute towards a further £150,000, we have no hesitation in repeating that hope."

  43. Details of the dates and amounts of donations to the Fund and in the case of the Earl of Portsmouth to Crockers with consequent payments to Crockers are set out with a chronology to be found with explanatory notes in Vol 1 tab 28 p.1-4.
  44. In my judgment looking at it from an objective standpoint the recipient or reader of Lord Harris's letters would reasonably conclude, even making allowance for the facts that Lord Harris's appeals for money were likely to be influenced by partisanship and to a degree lacking in objectivity, that Lord Harris genuinely believed in Mr Hamilton's innocence of Mr Al Fayed's serious accusations, that Mr Al Fayed's tactics and wealth were being used to stifle Mr Hamilton's legitimate attempt to clear his name, and that Mr Hamilton had a realistic prospect of success so long as sufficient funding for legal costs was maintained.
  45. The problem of funding of the litigation from Crocker's standpoint is dealt with in Mr Rupert Grey's statement (Vol 2. tab 40 p.1-7). In an attempt to keep this judgment from becoming unduly long I shall summarise. By February 1999 Mr Grey's estimate of costs was escalating and he was concerned that Lord Harris would be unable to raise further funds on a necessary scale. By the end of August 1999 the position was critical. Mr Grey estimated then that a further £600,000 was needed. On the 28th September 1999 the Hamiltons executed a charge in favour of Crockers on their Cheshire home limited to £350,000. Briefs were delivered to Counsel on the 10th October 1999. That was as Mr Grey put it the "point at which we crossed the Rubicon. After that there was no turning back". This was a decision reached by the partners of Crockers although they were aware that they were at risk for a significant part of their costs. Not until about 10 days later did Mr Grey learn that the Earl of Portsmouth might be prepared to contribute a substantial sum.
  46. Once the Rubicon had been crossed Mr Hamilton was not going to be deserted by his Solicitors for the reasons given in Mr Grey's statement nor would I have expected Counsel to have left Mr Hamilton in the lurch.
  47. In my judgment the probabilities are that the case would have proceeded to trial and concluded as it did irrespective of whether or not there had been further funding after the 10th October 1999. In fact Lord Harris was unaware of Crockers' decision to cross the Rubicon.
  48. Nor do I think that that decision, even if no further funds had been forthcoming would have been altered by the last minute amendment of the defence to plead as a particular of justification Mr Hamilton's solicitation of a fee from Mobil for moving an amendment to the Finance Bill albeit that it would result in lengthening the trial and its costs and be very likely to reduce seriously Mr Hamilton's chances of success.
  49. The Individual Respondents

  50. Sir Robert McAlpine Ltd donated £25,000 on the 20th October 1999 which was after the Rubicon was crossed.
  51. The company and the McAlpine family are long standing supporters of the Conservative Party.
  52. Mr Malcolm McAlpine had met Mr Hamilton three times, the last time in 1994 he knew Lord Harris well and was aware of the Fund. Mr Al Fayed was a substantial business client of McAlpine companies.
  53. The donation was made following a meeting of McAlpine family shareholders in order to do something which might enable the Conservative Party to repair the damage to its reputation caused by the allegations by Mr Al Fayed against Mr Hamilton, to enable Mr Hamilton who had consistently denied the cash for questions allegation to clear his name, to support Mr Hamilton who was outfunded and to create a more level playing field.
  54. Lord Hanson made one donation of £5000 on the 25th October 1999 which was after the Rubicon had been crossed. Lord Hanson was a Conservative back bencher in the House of Lords.
  55. He made his donation after receiving a letter from Lord Harris enclosing his letter in the Daily Telegraph of the 12th October 1999, The New Statesman article of October 1997, and an article in the Daily Telegraph by the Home Affairs Editor "Hamilton wins chance to face Fayed in Court".
  56. Lord Hanson had met Mr Hamilton very occasionally but did not know him personally. He knew what the litigation was about. He contributed to the Fund because Mr Hamilton was the underdog and should not be deprived of the opportunity to clear his name by reason of lack of financial resources.
  57. Mr Richard Clay made two donations the first £1000 on the 14th September 1999 when the litigation was already far advanced and the second of £10,000 on the 20th October 1999 which was after the Rubicon had been crossed.
  58. Mr Clay met Mr Hamilton by chance at a "Friends of Arthritis Care" meeting in about August 1999. Mr Hamilton told him that he could not afford to carry on his case but for the Neil Hamilton Fighting Fund. Prior to that he had never met Mr Hamilton or Mr Al Fayed.
  59. Mr Clay had heard of the Fund because of Lord Harris's January 1999 letter to the Daily Telegraph. He subscribed to the Fund because he took the view that Mr Hamilton had not been given a fair hearing by the House of Commons Select Committee and had been unfairly found guilty in the Downey Report. Mr Clay wanted to enable Mr Hamilton to bring his case to Court for a fair hearing on the evidence. He had no reason to doubt the strength of Mr Hamilton's case as expressed by Lord Harris.
  60. The Duke of Devonshire made two donations the first £5000 on the 15th April 1998 and the second £10,000 on the 12th October 1999 which was after the Rubicon was crossed.
  61. The Duke of Devonshire who has never met either Mr Hamilton or Mr Al Fayed made his donations following a telephone call from Lord Harris and his letters in the Daily Telegraph "to enable a case of genuine public interest and some constitutional importance to be brought before the Court". He believed that Mr Hamilton was bringing his claim bona fide and was motivated by a wish to assist Mr Hamilton to clear his name.
  62. Mr Christopher Sharples donated £10,000 to the fund on the 6th October 1999, as the result of Lord Harris's letter to the Daily Telegraph on the 26th January 1998. His reason was that he felt that Mr Hamilton was entitled to have the opportunity to clear his name.
  63. He did not know and had never met either Mr Hamilton or Mr Al Fayed .
  64. He was unaware of the risk of an application under S.51.
  65. Mr David Wills donated £5000 to the Fund on the 22nd October 1999 after the Rubicon had been crossed. He made his contribution following Lord Harris's letter to the Daily Telegraph of the 11th October 1999. His reason was to enable Mr Hamilton to meet the costs of having his case decided on the evidence by a Court of Law after Mr Al Fayed had unsuccessfully argued on appeal that Mr Hamilton's case should be struck out because of the Downey Report.
  66. Mr Wills had never met nor spoken to either Mr Hamilton or Mr Al Fayed. He was unaware of the risk of a S.51 application. If he had been, he would not have made his donation.
  67. Unlike other donors Mr Taki Theodoracopulos and Mr Al Fayed knew each other well at least in print.
  68. In his Atticus columns and High Life columns in the Spectator Mr Al Fayed was the frequent butt of Mr Theodoracopulos's raillery and ridicule. These columns may not be to the taste of some but to many others they cause amusement with their robust style reminiscent of 18th century Grubb Street. On occasion Mr Al Fayed made vigorous riposte by letter as when he described him in these terms in a letter to the Sunday Times on the 30th October 1994.
  69. "I am not aware of ever having met Mr Theodoracopulus and while I am happy to forgo that pleasure, I must ask him to pay some regard to the truth when writing about my family life in Switzerland (Atticus, last week). I acquired my first chalet in Gstaad in 1968, at which time a fellow by his name was living in a bedsitter and was well known locally for arriving at other people's homes at mealtimes.

    I come to Gstaad for relaxed family holidays and I am particular about the company I keep, and those convicted and jailed for the possession of drugs, like Mr Theodoracopulos, are not welcome"

  70. The numerous tit for tat published exchanges are to be found in Vol 1 tab 10 - pages 1-79. I do not accept that Mr Theodoracopulos was motivated by malevolence towards Mr Al Fayed when making his donations. No doubt the two men are antipathetic towards each other and maybe Mr Theodoracopulos somewhat relished making donations to the Fund, £10,000 in the 17th June 1999 and £20,000 on the 22nd December 1999 after verdict in the trial.
  71. In his written response to Mr Al Fayed's application Mr Theodoracopulos explained how he came to make his donations.
  72. "These letters (from Lord Harris) prompted Mr Theodoracopulos to pledge £5,000 in support in response. Mr Theodoracopulos was then contacted personally by Lord Harris, and invited over a drink at the House of Lords (thought to be 29 June 1998) to contribute more to the fund, Lord Harris made it clear that unless his pledge was improved Mr Hamilton would be unable to bring his case and "a great miscarriage of justice would have occurred". Mr Theodoracopulos improved his pledge by a further £5,000. On or about 12 June 1998 Mr Theodoracopulos duly transferred £10,000 from an account of his to Mr Hamilton's legal fighting fund.

    Thereafter Mr Theodoracopulos had no involvement of any kind with Mr Hamilton's libel action, save for receiving an occasional progress report from Lord Harris accompanied usually by a request for more pledges or funds (which Mr Theodoracopulos did not respond to). This last progress report/request for funds was received from Lord Harris and Mr McWhirter in October 1999 shortly before Mr Hamilton's trial, and made it clear that a further £220,000 was needed, notwithstanding that Mr Hamilton had pledged his house, Mr Theodoracopulos did not respond to this request.

    Finally, during the trial, Mr Theodoracopulos was contacted personally by telephone by Lord Harris in New York, and told that the case would collapse without a further injection of finance. At this stage, Mr Theodoracopulos was aware that evidence had emerged during the trial that Mr Hamilton had taken payments from Mobil Oil. Lord Harris assured him that this evidence was irrelevant, and pressured him to make the payment. Mr Theodoracopulos relented and agreed to make a further payment of £20,000 which was done on 22 December 1999."

  73. Despite the years of literary jousting and the libel suit against Mr Al Fayed about cocaine sniffing which was withdrawn I am satisfied that Mr Theodoracopulos's main motive for contributing was charity. He said in his written statement dated the 7th January 2001:-
  74. "I was, after the various entreaties from Lord Harris, prepared to contribute to the fund in order to right what I considered to be a significant wrong. That is, a rich man having ruined a public servant who did not have the financial means to mount a Court battle to clear his name. My motivation for the contribution was that of charity. I felt that Mr Hamilton deserved his day in Court and the opportunity to be judged by his peers rather than the media or the defendant. I have over the years made other charitable donations to high profile people in financial difficulties, to which I have made reference from time to time in my various columns. For this reason, it may be that I was approached by supporters of Mr Hamilton, who considered me to be potentially a "soft touch" for a donation...I deny the suggestion that I was motivated by personal antipathy against Mr Fayed. In particular, none of my articles written about the Hamilton case or Mr Fayed back up the suggestion that my support for the Neil Hamilton fighting fund was anything other than a genuinely charitable donation."

  75. The Earl of Portsmouth transferred £100,000 to Mr Hamilton's Solicitors on the 26th October 1999 after the Rubicon had been crossed and allowed it to be drawn down on the 29th November 1999 in the middle of the trial and on the 22nd December 1999 at its conclusion.
  76. His motive was to ensure that an impecunious litigant fought his case on a level playing field. His interest in the case was triggered by Lord Harris's letter in the Daily Telegraph of the 12th October 1999. He decided to make a long-stop contribution having met Lord Harris
  77. He was told by Lord Harris on the 21st October 1999 that Mr Hamilton had charged the equity in his home as security for his own costs. If he had not been told that, it is unlikely that he would have been prepared to help.
  78. In his written statement (Vol 2 tab 39) the Earl of Portsmouth said at page 4:-
  79. "Lord Harris then arranged for me to meet Mr Hamilton and his wife Christine at a lunch on 11 November 1999 at San Lorenzo in Beauchamp Place. During lunch Mr Hamilton briefly discussed the case and its impact on their lives. He was adamant that Mr Fayed was seeking revenge for his failure to deliver on past favours when he became a Minister. He said nothing to make me think that he might not be telling the truth and that he was not acting in good faith.

    I was then introduced to Mr Grey on 29 November 1999 at my club. During that meeting he updated me on the progress of the litigation. He told me that the case was going well and he asked me to consent to the drawdown of my contribution. By a letter sent the next day, I confirmed that he could drawdown the funds. On 3 December 1999, Mr Grey wrote to me confirming that he had done so.

    at page 5

    Prior to reading Lord Harris' letter in the Daily Telegraph on 12 October 1999 I had no knowledge of the fighting fund or of the difficulties that Mr Hamilton had in funding his attempts to clear his name.

    I accept that the appeal by Lord Harris in the Daily Telegraph of 12 October 1999 stated that "a final effort is needed to prevent Mr Fayed forcing his challenger to abandon the action for lack of funds". In my experience it is in the nature of such appeals that they paint the worst possible picture in order to ensure that funds are forthcoming. From my discussions with Lord Harris, Mr Hamilton and Mr Grey, I did not believe that there was a real prospect of the action having to be abandoned at that late stage if no further funds had been forthcoming. What concerned me was that either Mr Hamilton's solicitors would be unable to conduct the case properly through a lack of funds or he would have to fight the case himself. My sole concern was to see that justice was done and, to this end, to ensure that the case was contested on a level playing field."

  80. The Earl of Portsmouth's letter to the Daily Telegraph and the transcript of his interview by Sue McGregor on the 23rd December 1999 are at Vol 1 tab 7 at page 7-13.
  81. In my judgment there is no reason at all to doubt the genuiness of the Earl of Portsmouth's statement. The essential reason for his contribution was to ensure that the case was contested on a level playing field. Before making his contribution he had never met Mr Hamilton. He was concerned that Mr Hamilton had not been given an opportunity of cross-examining Mr Al Fayed and his employees before Sir Gordon Downey.
  82. In my judgment it could not be suggested that the Earl of Portsmouth was an officious intemeddler in the case. Nor do I consider it relevant that he provided financial support in the cases of Count Tolstoy and of Mr Ian Hay Gordon. Many would think it was to his credit that he did.
  83. By way of example Mr Al Fayed claimed £554,725.47 excluding interest from the Earl of Portsmouth. For details relating to the maximum amounts claimed from other donors, see the document entitled "Note on costs claimed by Mohamed Al Fayed".
  84. The Settlors

  85. A total of about 18 donors to the Fund have settled with Mr Al Fayed in respect of his applications against them under S51. The total amount payable to Mr Al Fayed by settlors is about £200,000.
  86. In my judgment the fact that some donors have settled with Mr Al Fayed in some instances agreeing to pay substantial sums in excess of the amounts of their donations towards Mr Hamilton's costs is a wholly irrelevant factor in my discretionary exercise.
  87. The reasons why some donors have settled are unknown to me and may be varied such as
  88. (a) The risks of litigation which might result not only in an order for the payment of a proportion of Mr Al Fayed's costs not only larger than their donations but also than the sum that Mr Al Fayed would accept in settlement and an order for the payment of Mr Al Fayed's costs because of resistance to the application.

    (b) The maintenance of confidentiality and privacy.

    (c) Unwillingness to make an outlay for their own costs

    (d) Removal of the anxiety of litigation.

    Funding

  89. A distinction has to be drawn between what I shall call "pure" and "professional" funders.
  90. The respondents to Mr Al Fayed's application are pure funders. Their donations towards Mr Hamilton's costs were not made as the result of any obligation owed to him but as an act of charity through sympathy with his predicament and in some instances affinity to the Conservative Party. They have no control over how their donation is spent. They have no part in the management of the litigation up to and including the trial. Their donation renders them liable to a Section 51 application. Except possibly by insurance they have no way of limiting the extent of their potential liability. The only limit to their potential liability will result from orders of the Court including assessments of the Costs Judge relating to Mr Al Fayed's costs into which they have no input. Their only hope was that Mr Hamilton would achieve sufficient success in trial to enable their donations to be repaid to them. Why would a pure donor be in any more vulnerable position than a Solicitor or Counsel acting on a contingency fee? (See the observations of Rose L.J. in Tolstoy v. Aldington [1996] 1W.L.R. 736 at page 746.)
  91. The position of the professional funder is very different. Almost always the funding arises out of a contractual obligation for example where the funder is a trade union, an insurer or a professional or trade association. Normally such a funder exercises considerable control management and supervision of the litigation. Often the choice of Counsel, Solicitors and experts will be his. Usually he will receive regular up-dated reports from the Solicitors of the changing prospects of success or failure in the litigation and the opinions of Counsel. Usually armed with the sanction of ceasing funding, he can to a degree limit the extent of his liability for costs by directing Part 36 offers, payments into Court, admissions and such like.
  92. Thus it is in the case of the professional funder who has backed the loser that he invariably pays the winner's costs as a matter of routine without any application under S.51 It would be very exceptional that a situation would arise where it would not be just and reasonable to make a S.51 order against a professional funder.
  93. The reverse is the position in the case of a pure funder. It will be rare or very rare that it will be just and reasonable to make an order against him. Sir Sydney Kentridge Q.C. and other Counsel seemed to be arguing that dicta in the Court of Appeal resulted almost in a rule exempting pure funders of even potential liability from a S.51 order. I do not accept this. Would it not be just and reasonable, if there was litigation between two litigants of limited means where one was funded by charitable donations and one was not, to make an order under S.51 against the charitable donors if the unfunded litigant was successful in the litigation otherwise the successful unfunded litigant might have to sell his home to pay his own Solicitor's Costs? Would indiscriminate and unrestricted charitable funding always accord with the overriding objective of the C.P.R.? I would venture to suggest it might well for example in medical negligence and defamation cases not be so.
  94. Sympathy for the supposed victims of medical negligence and defamation is creditable. So is financial support for those of limited means against rich opponents in appropriate cases. For example charitable funding for the supposed victim of medical negligence might well not result in a S.51 order if that financial support was limited to say the stages of obtaining disclosure of medical records, an expert's report and a Q.C.'s opinion. In defamation if the Q.C.'s opinion was that no substantial vindication of the claimant's reputation or substantial award of damages are likely to be achieved why should the donor not be potentially liable to costs thereafter if he continues to fund the litigation? Legal Aid in the past had its disciplines and brakes such as limited certificates, authority being required for expert evidence and Counsel's opinion on the merits. This provided a measure of protection to the legally -aided litigant's opponent. In my judgment a blanket immunity for charitable donors acting out of sympathy for the impecunious litigant and a sense of fairplay would be contrary to the public interest and the overall interests of justice.
  95. I realise that much that I have said is obiter but I have done so in deference to the submissions of Counsel for the respondents the effect of which was that because of decisions of the Court of Appeal in reality I had to exercise my discretion in their favour because they were pure funders.
  96. I do not subscribe to the view of Mr Lock, The Lord Chancellor's Parliamentary Secretary who immediately after verdict in the action precipitately announced that consideration was to be given to banning the funding of defamation actions. In my judgment any outlawing of such funding would be incompatible with Article 6 as inhibiting access to justice.
  97. Maintenance

  98. Section 14 of the Criminal Law Act 1967 abolished the tort of maintenance. However, I was referred to a number of maintenance cases. In my judgment the maintenance cases are of marginal relevance today when a Judge is exercising his discretion whether or not to make an order under Section 51 on the particular facts and circumstances of the case before him. I note that in Shah v. Karanjia ([1993] 4 All E.R. 792 at 810) Vinelott J. said:-
  99. "I am not persuaded that the old law of Maintenance offers any guide to the exercise of the Court's discretion under S.51."

  100. Yet I do accept the argument of Sir Sydney Kentridge Q.C. that the maintenance cases show that charitable financial support for impecunious litigants has accorded with public policy and the interests of justice since at least about 1400. Public policy is flexible and responds to the needs of the age. In my judgment with the availability of legal aid being much reduced charitable financial support for the impecunious litigant today is surely in accord with public policy and the interests of justice. I agree with Sir Sydney that the Courts should not discourage such charity.
  101. Legal aid has never been available in defamation cases despite the recommendation of the Faulks Committee (CMO 5909 (1974) paras 578-581). In defamation cases conditional fee arrangements may be very difficult to obtain for a variety of reasons. Highly contested high profile cases are very costly and time-consuming to prepare. On a full vindication of reputation the award of damages is effectively capped (See John v. MGN Ltd [1997] Q.B.586). In many cases a partial vindication with consequent small award of damages will be the result (See Pamplin v. Express Newspapers [1988] 1W.L.R.116).
  102. Certain situations or relationships were lawful excuses to a charge of maintenance. I do not accept the suggestion that the existence of such a situation or relationship can be determinative against making an order under S.51 but I do accept that its existence make it highly unlikely that the case would be one of those very rare cases when it was just and reasonable to make an order under S.51 against a non-party.
  103. In Bradlaugh v. Newdigate [1883] 11 Q.B.D.1 Lord Coleridge C.J. said at page 11 giving instances of what made justifiable what otherwise would have been maintenance:-
  104. "a rich man giving money to a poor man out of charity to maintain a right which he would otherwise lose"

    the interest "which charity and compassion give a man in behalf of a poor man who, but for the aid of his rich helper, could not assert his rights or would be oppressed and overborne in his endeavour to maintain them"

  105. In Harris v. Brisco [1886] 17 QBD 504 Fry L.J. giving the reserved judgment of the Court of Appeal said at page 512:-
  106. "Now the facts of the case, as found by Wills.J., appeared to us to be shortly, that the defendant Brisco aided Nailer out of charity, and because - he believed him to be oppressed by Harris, but in fact Nailer was not oppressed by Harris, and had no cause of action against him, and that Brisco took no reasonable pains to make inquiry into the real facts of the case, or to ascertain those facts, and, that, if he had acted as a reasonable man, he would never have aided Nailer in an action, and thereby put Harris, not only to the anxiety and trouble of being defendant in the action, but to the loss of his costs from the poverty of Nailer; and Wills.J., has held, as a matter of law, that the mere desire to benefit Nailer is not a defence to the present action, "unless the defendant had some reasonable ground for his belief that he was furthering the cause of justice and supporting the oppressed against the oppressor"

    The doctrine that charity is an excuse for maintenance seems first to have found expression in our law in the case of Rothewell v. Pewer (Y.B.9 Hen. 6,p.64), in the course of which Martin, Justice of the Common Pleas, said "I can give gold or silver to a man that is poor to maintain his plea, if he himself cannot through his poverty: this is not maintenance against the law", and in Power or Pomeroy v. Abbot of Buckfast (Y.B..21 Hen.6.p.15) Paston, a judge of the Common Pleas, said "Suppose that I of my charity give a sum of money to a poor man who has a suit, in order to aid him in the suit; it is no maintenance; no more is it in the case at the bar

    and at page 513 he said

    "It appears to us to follow that the limitation put on the meaning of the word "charity" by Wills, J., cannot be maintained. He requires that charity shall be thoughtful of its consequences, shall be regardful of the interest of the supposed oppressor, as well as of the supposed victim, and shall act only after due inquiry and upon reasonable and probable cause. If we were making new law and not declaring old law it would, in our opinion, be well worthy of consideration whether such a limitation of the doctrine that charity is an excuse for maintenance would not be wise and good. But is it not an anachronism to suppose any such view of charity to have been present to the minds of the judges of the reign of Henry VI? - a view which even now is present to the minds only of a select few, and does not commend itself to a large proportion of the kind-hearted and charitable amongst mankind? To say that charity is not charity unless it be discreet, appears to us without foundation in law. Of this limitation on the word "charity" no trace can be found in any of the authorities which have been cited, and, furthermore, in the other exceptions to the law of maintenance, such as those arising from the relations between lord and tenant, master and servant, neighbour and neighbour, there appears, so far as we can learn, to be no case or dictum in the books in which the duty of making inquiry, or of acting only on reasonable and probable grounds, has been recognised as a limitation of the right of giving assistance."

  107. In my judgment considerable circumspection is required with regard to the proposition that indiscreet charity is a defence to a charge of maintenance on an application under S.51. Indiscreet charity cannot of itself defeat a claim for costs against a non-party under S.51. Charity whether discreet or indiscreet cannot be an absolute defence to such a claim. The discretion cannot be so fettered. In my judgment a relevant factor to be taken into account is the answer to the question whether the charitable donor had on the information before him reasonable grounds for believing that the litigant had a realistic prospect of success or other reasonable grounds for asserting his right or a defence to a claim. I emphasise that the answer to that question is not a determinative factor. At the other end of the scale is the quixotic philanthropist who is reckless as to whether the litigant has any realistic prospect of success or any reasonable grounds for asserting his right or a defence to a claim. I can see good policy grounds for making S.51 orders against a hypothetical quixotic philanthropist who willy-nilly supported claims by litigants against hospitals in alleged medical negligence cases or against organs of the media in defamation cases
  108. In Martell v. Consett Iron [1955]Ch.363 it is ironic in the light of the current problems on the funding of civil litigation that Sir Andrew Clark Q.C. should say in argument that charity was a recognised exception to the rule that maintenance was illegal at page 369 "but it is not known to what extent that would hold good today because of legal aid". At page 375 Danckwerts.J. made the important point that impecuniousity is relative, a factor relevant in the present case. He said:-
  109. "But it is contended on behalf of the defendant company that the action should be stayed and the plaintiffs should not have the chance to have their case heard, so long as they receive the assistance of these indemnities without which the plaintiffs would not feel able to face the formidable expense which, it is well known in the carrying on of a pollution action involves. If this contention is correct, it may be thought that there is something wrong with the state of the law."

    "It would be disingenuous to disregard the difficulties which the man of small financial resources (not confined to the legal aid class) faces in present-day conditions in defending such rights as he may have against infringement by powerful commercial corporations or adversaries who may draw their strength from the rates or the National Exchequer. If such a man may not avail himself of the help of sympathisers, his condition may be serious indeed. His relative position is still more unfavourable if his powerful commercial opponents may deduct the costs of such litigation as trade expenses."

  110. In the Court of Appeal at page 414 Jenkins.L.J. considered maintenance in relation to defamation saying:-
  111. "In Alabaster v. Harness ([1895] 1Q.B.339) and Oram v. Hutt ([1914] 1.Ch.98) the actions which had been maintained were actions for libel or slander, that is to say, actions in respect of wrongs essentially personal to the plaintiffs, and it is in this context that the observations in the judgment in these cases as to the common interest required in order to justify maintenance being an interest recognized by the law in the subject-matter of the action or some issue between the parties to the action must be considered. In Neville v. London "Express" Newspapers Ltd ([1919]A.C.368) the maintained action was of a different kind, but one in which the absence of any common interest between the maintainers and the parties maintained was, if anything, plainer that it was in Alabaster .v.Harness ([1895] 1.Q.B.339) and Oram .v. Hutt ([1914] 1.Ch.98)

    "The pollution of a man's character or reputation by libel or slander is a matter personal to him, and he alone is concerned in the prosecution of any action brought in respect of it, even though the same words might be made the subject of an action by some other person."

  112. Oram v. Hutt was expressly disapproved by the Court of Appeal in Hill v. Archbold [1968] 1Q.B.686 where Lord Denning M.R. said at page 694:-
  113. "I prefer to say plainly that Oram v. Hutt is no longer good law. Much maintenance is considered justifiable today which would in 1914 have been considered obnoxious. Most of the actions in our courts are supported by some association or other, or by the state itself. Comparatively few litigants bring suits, or defend them, at their own expense. Most claims by workmen against their employers are paid for by a trade union. Most defences of motorists are paid for by insurance companies. This is perfectly justifiable and is accepted by everyone as lawful, provided always that the one who supports the litigation, if it fails, pays the costs of the other side. It is the universal experience in this court that if a trade union or an insurance company supports a case and fails, it pays the costs of the other side. In the light of this experience, I am satisfied that if Oram v. Hutt were to come before us today, we should hold that the union had a legitimate interest in the suit and were quite justified in maintaining it: remembering that if the suit had failed, the union would have paid the costs. "

  114. In my judgment when considering an application under S.51 defamation cases should not be put in a special category. In some instances of defamation injury to reputation can be as damaging to some victims as physical injury. I add this caveat: in defamation cases the Court must have particular regard to the importance of the Convention right to freedom of expression (See Article 10(1) which is underpinned by Section 12 (4) of the Human Rights Act 1998) although as Sir Sydney Kentridge Q.C. pointed out it is a qualified right (See Article 10(2)) If there is need for the protection of the reputation or rights of others, those others have to be able to have a fair trial to assert their rights (Article 6). A fair trial against a rich defendant publisher requires the relatively poor claimant victim to be adequately funded. But that still begs the question whether the pure charitable donor of funds to a needy litigant should always escape liability on an application under S.51 If there was or was perceived to be a blanket exemption to pure charitable donors, it could have an inhibiting effect on the freedom of expression on matters of legitimate public interest and therefore contrary to Article 10. Certainly Mr Al Fayed's accusation that Mr Hamilton had cash for questions was of legitimate public interest.
  115. Guidance From the Court of Appeal

  116. None of the cases cited before me dealt with the problems raised by the creation of a charitable fund raised by private fund-raisers, whose own contributions were small, through begging letters to rich individuals and letters published in the National Press resulting in contributions large and small totalling a big sum enabling a litigant of limited means to progress his litigation against a very rich opponent. So this case has its unusual features.
  117. Throughout the last decade the Court of Appeal has emphasised time and again the exceptionality principle, much urged upon me by Counsel for the respondents. It cannot be a principle of law or a rule of practice because that would fetter the discretion but is a guideline which I heeded and had very much in mind.
  118. In Taylor v. Pace Developments [1991] BCC 406, where successful plaintiffs failed to obtain a S.51 order against the Managing Director and sole shareholder of an insolvent company, the unsuccessful defendants, Lloyd L.J. said at 410D:-
  119. "It will only be in an exceptional case that justice will require a person who is non-party to proceedings to be ordered to pay the costs"

  120. Taylor's case was followed in Cooper v. Maxwell (C.A. Transcript 20 March 1992) where Dillon L.J. said at page 1:-
  121. "It is now known that the funder is Mr Maxwell's mother, Mrs Elisabeth Maxwell, the widow of Mr Robert Maxwell. She has said in her affidavit that on or about the 11th December of last year, which was shortly after Mr Maxwell's death, Kevin Maxwell asked here to help him and asked for £100,000 to help him pay legal fees. She did so without knowing, as she said, for what specific proceedings the moneys were to be used. Then a few days later, on 16th December, she had a talk with both her sons, Kevin and Ian Maxwell, and they asked for a further £400,000 each which they needed for legal fees. She says that she agreed to support them.

    At Page 2

    "It has further been held by this court in Re Land and Property Trust Company plc [1991] 1.WLR 601, where Lord Justice Nicholls gave the leading judgment, that the circumstances in which it will be just to make a costs' order against a person who is not a party to the proceedings will be exceptional. In the nature of things, he said, it will very seldom be right to order a person who is not a party to the proceedings to pay the costs of the proceedings. The consequence of that was that an appeal lay against an order against a third party without need to obtain leave from the judge who had made the order"

    Whether the proceedings are being brought or defended bona fide is obviously an important consideration. The court would much more readily make an order for costs against a third party who had funded the proceedings if the court held that the proceedings were not brought bona fide. In the present case, however, we do not have to consider that. It is conceded by the Provisional Liquidators that there was no impropriety in the conduct of Mr Kevin Maxwell's defence in these proceedings and that the appeal, although dismissed by this court was brought bona fide."

    At Page 3

    "The development of the authorities has not been that there will automatically be an order for costs against a person who is not a party to the proceedings if that person has funded the litigation. More is required. It is not suggested that a bank which funded litigation by providing an overdraft for a party to litigation on commercial terms would automatically be ordered to pay the others side's costs if the litigation was unsuccessful. The position could be different with a trade union which has an interest in funding the litigation of a member in the industrial field and habitually does pay the costs if the litigation fails. I do not see that there is anything in the circumstances of Mrs Maxwell in the present case which makes it right that the court should make an order against her to pay the costs of Mr Kevin Maxwell's unsuccessful appeal. Accordingly I would reject this application by the Provisional Liquidators."

  122. For the respondents much emphasis was placed on the sentence "More is required". So much so that it was submitted that in a charitable donation "without more" no S.51 order should ever be made. If that be right, an unsatisfactory result could occur in situations to which I have alluded.
  123. Having regard to the protestations of innocence by Mr Hamilton, the conduct of his Solicitors and the statements of Lord Harris none of the respondents had any reason to believe that Mr Hamilton's claim was not brought bona fide.
  124. Whether or not Mr Hamilton lied to the Jury in denying receiving cash for questions from Mr Al Fayed cannot be deduced from the Jury's verdict. Certainly the Mobil evidence will have had a significant impact on the Jury. (See the judgment of the Court of Appeal Transcript 21 December 2000 at page 13 paragraph 44).
  125. Mr James Price Q.C. for Mr Al Fayed placed great emphasis on the decision of Judge Hicks Q.C. in Thistleton v. Hendricks [1992] 32 CON LR 123, a dispute between Thistleton, the builder, and Hendricks, the building owner. Judge Hicks Q.C. ordered the unsuccessful builder's mother to pay £7000 towards the successful building owner. Judge Hicks Q.C. said:-
  126. "Although I therefore reject Mr Robinson's submission that there is any rule against ordering lawful funders of litigation to pay costs I do not exclude the possibility that, in the exercise of discretion, some funders, or categories of funders, may be regarded more benevolently, or more mercifully, than others. For my own part I consider that for that purpose the facts that Mrs Thisleton' s support stemmed in part from their kinship ("he was my son, he needed the money and I expected to be repaid eventually" was her only direct evidence of motive.) rather than commercial interest is a factor to be taken into account in her favour, although not a decisive one."

    "It seems to me that there are two further basic principles to be taken into consideration. On the one hand access to the courts is not to be denied or hindered without good cause. On the other hand it is an important element in our system of administration of justice that in civil litigation costs normally follow the event, so that a successful litigant is so far as possible (and subject to a measure of curtailment on taxation) given the opportunity of reimbursing himself for his legal expenses. This is so familiar a fact that it is easy to forget that it is far from universal among legal systems generally. I regard it as a significant indication of the policy of English Law in this field."

    "There are, of course, exceptions, of which the most important for present purposes is Legal Aid. It is, however, to be noted that where an assisted person is unsuccessful the principles upon which an order for costs are made against him are not altered; it is only enforcement of any order against the assisted person which requires the discretionary leave of the court. Even more significantly for present purposes, there is the possibility of obtaining an order for costs to be paid to the successful opponent out of the legal aid fund, that is to say (in the terminology which I have been using) from the "funder" of the unsuccessful litigant. That provision was introduced by statute some little time after the inception of Legal Aid and owed its existence, at least in part, to a high level of judicial disquiet at the injustice occasioned in its absence to some unassisted and unsupported opponents of assisted persons. It is confined, in relation to proceedings at first instance, to cases of severe financial hardship. That restriction no doubt reflects both the interest of the public purse and the fact that many unassisted defendants are insured. What is in my view a more relevant restriction is that at first instance there is no remedy against the fund unless the proceedings were instituted by the assisted person, that is to say unless he was a plaintiff."

  127. In distinguishing Cooper v. Maxwell Judge Hicks Q.C. said:-
  128. "I have given my reasons for believing that the distinction between plaintiff and defendant is a material one"

  129. Mr James Price Q.C. prayed in aid these dicta of Judge Hicks Q.C. stressing that Mr Al Fayed was a defendant whom Mr Hamilton had chosen to sue. While I accept that the fact that an applicant for a S.51 order is a successful defendant is a circumstance to take into account in the exercise of the discretion, I do not accept that it is a circumstance which limits the exceptionality guideline. Moreover I agree with the submissions of Counsel for the respondents that Thistleton's case may well not have been decided today as it was in 1992.
  130. Mr James Price Q.C. also relied upon dicta of Sir Thomas Bingham M.R. in Roache v. News Group Newspapers (C.A. Transcript 19 November 1992) who said:-
  131. "Two principles, habitually applied in exercising he discretion to award costs, are of relevance for present purposes. The first is that in the ordinary way costs follow the event. This means that the winner of the action recovers his costs, taxed if not agreed, which the loser has to pay. In a simple case this rule raises no problem, but more complex cases may arise in which it is necessary to investigate with some care who is really the winner and who is really to loser or, as it is sometimes put, to identify the event which costs are to follow. Other legal systems observe quite different rules, but in our system this principle is of fundamental importance in deterring plaintiffs from bringing and defendants from defending actions they are likely to lose.

    This second principle is that where a plaintiff claims a financial remedy in debt or damages and the defendant pays into court a sum, not accepted by the plaintiff, equal to or greater than the plaintiff recovers in the action, the plaintiff is ordinarily ordered to pay the defendant's costs, taxed if not agreed, from the date of he payment in. The rationale of the rule is obvious. If the plaintiff puts the defendant to the expense of a trial in order to recover no more that he could have recovered without a trial, he should compensate the defendant for the unnecessary expense to which he has been put. This principle also is of fundamental importance in our system. A defendant cannot ordinarily prevent a plaintiff pursuing his claims, however exaggerated they may be, and may thus have a burden of costs in defending the claims thrust upon him. All he can do to protect himself is to pay into court what is justly due or what the plaintiff may prove likely to recover. If the defendant's judgment proves accurate, he will still incur the costs of his defence but he can look to the plaintiff for reimbursement. It is the only protection he has against a burden of costs which might be, quite literally, ruinous."

  132. In reaching my conclusion I have had Sir Thomas Bingham's first principle well in mind
  133. In Symphony Group v. Hodgson [1994] Q.B.179 Balcombe.L.J. summarised the categories of cases where the Court had been prepared to order a non-party to pay the costs of proceeding under various heads (See page 191-2). He accepted that "these categories are neither rigid nor closed". He went on to say referring to Lord Goff's dicta in Aiden Shipping:-
  134. "However, it seems to me that the particular circumstances of this case require this court to accept the invitation of Lord Goff in Aiden Shipping Co. Ltd v. Interbulk Ltd [1986] A.C.965 and to lay down some principles for the guidance of judges of first instance when they are asked to make an order for costs against a non-party and in doing so I am well aware of what Lloyd L.J. said in Taylor v. Pace Developments Ltd [1991] B.C.C. 406,408: "There is only one immutable rule in relation to costs, and that is that there are no immutable rules". I am also aware of the observations warning against laying down rules for he exercise of a discretion in relation to costs generally by Bowen L.J. in Jones v. Curling [1884] 13 Q.B.D. 262, 271 and by Brett M.R. in The Friedeberg [1885] 10 P.D. 112,113. Nevertheless I am fortified by the fact that Lord Goff considered that such guidance might well become necessary and I believe that the circumstances of this case indicate the present necessity for guidance. In my judgment the following are material considerations to be taken into account, although I do not suggest that there may not be others which are relevant.

    An order for the payment of costs by a non-party will always be exceptional: see per Lord Goff in Aiden Shipping Co. Ltd v. Interbulk Ltd [1986] A.C. 965, 980F. The judge should treat any application for such an order with considerable caution."

    At page 193 Balcombe L.J. said:-

    "he should warn the non-party at the earliest opportunity of the possibility that he may seek to apply for costs against him. At the very least this will give the non-party an opportunity to apply to be joined as a party to the action

    "An application for payment of costs by a non-party should normally be determined by the trial judge: see Bahai v. Rashidian [1985] 1.W.L.R. 1337."

    "The procedure for the determination of costs is a summary procedure, not necessarily subject to all the rules that would apply in an action"

    at page 194

    "The judge should be alert to the possibility that an application against a non-party is motivated by resentment of an inability to obtain an effective order for costs against a legally aided litigant"

  135. In my judgment Mr Al Fayed's Solicitors did everything that could be expected of them to warn contributors to the Fund of the risk that they were facing. On the 13th January 1999 they wrote to Mr Hamilton's Solicitors:-
  136. "As you will be aware, we are obliged under the principles laid down by Balcombe LJ in Symphony Group Plc v. Hodgson [1994] QB 179 (as affirmed in Shah v Karanjia [1993] 4 All ER 792) to put you and your client on notice that if our client succeeds in his defence at the trial of this action or if any interlocutory decision is made which brings the action to an end prior to trial, and any part of the costs of this action are awarded in favour of our client, he will seek to apply for costs against any party who has been funding or maintaining this action

    There is substantial amount of evidence now available which suggest that your client does not have sufficient funds to meet our client's costs of the action if our client obtains an award in his favour, and that your client is being maintained by others who are funding the costs he is incurring. We would refer you, inter alia, to:

    an article in the Sunday Times on 18 January which referred to a "fighting fund of £150,000" organised by Lord Harris of High Cross, that article also quotes your client as admitting he did not have the financial resources to launch a costly civil action;

    The comments of your Leading Counsel before Mr Justice Popplewell in July 1998 (quoted in a Press Association report on 31 July 1998) that "in bringing this case, Mr Hamilton depended on the philanthropy of those who believed he suffered a grave injustice..."; and a letter from Lord Harris of High Cross printed in the Daily Telegraph on 6 August 1998 seeking money from readers of that newspaper to support this action (the second such appeal letter written by Lord Harris printed in that newspaper).

    We must emphasise that we are not seeking in any way, by this letter to dissuade your client from prosecuting his action against our client but we are sure you will appreciate that our professional duty to our client requires us to make enquiries about the nature of your client's funding of this action under the principles outlined in Symphony, to avoid our client being precluded from making an application against any non-party who has been funding your client at a later date.

    Accordingly, we would ask that you:

    1. identify the party or parties maintaining your client and their interest in the litigation;

    2 indicate whether they have each been advised, in writing that they may be liable to a costs order against them under the principles outlined in symphony.

    In accordance with the principles laid down in Symphony, we would wish to write to all those who may be funding this action to put them on notice that we may be instructed to make such an application at the conclusion of the action. We do intend in any event to write to Lord Harris of High Cross who appears to be the co-ordinator of your client's funding (and to have contributed funding himself) but thought we should first write to you to give you a proper opportunity of responding before we do so"

  137. Mr Rupert Grey replied on the 28th January 1999.
  138. "Notwithstanding the pious observation in the second paragraph of your letter of 13 January, the letter smacks of intimidation; in financial terms this litigation has the hallmark of David v Goliath, and we find the deployment in this context to Mr Hamilton's financial position as a device to undermine the prosecution of a legitimate claim is distasteful

    Both requests contained in the second paragraph of your letter are rejected, the question of our supplying the information you seek does not arise until such time as an order for costs is made against our client and he is shown to be unable to satisfy such order.

    We note, further, that you provide no evidence in your letter of 13 January for the suggestion that our client will not be in a position to satisfy an order for costs made against him. In any event the authorities to which you refer - and authorities to which you do not refer - do not assist you client; on the contrary, they provide solid ammunition to resist a claim by your client against the donors to the fund for Mr Hamilton, many of whom have donated small sums of money.

    We have sent a copy of this exchange of correspondence to Lord Harris of High Cross so that he may know what you are suggesting about the need for donors to take legal advice."

  139. Lord Harris chose not to warn potential donors of the risk and if any asked they were told that there was no realistic prospect of a costs order being made against them. Although donors might be presumed to know the law, in my judgment the fact that the donors were not warned of the potential risk that they might be ordered to pay towards Mr Al Fayed's costs if he were successful, is a circumstance which I should properly take into account when deciding whether it is just and reasonable to make an order under S.51. Several donors have stated that they would not have contributed if they had known of the risk.
  140. In Metalloy Supplies v. M.A. [1997] 1W.L.R. 1613 Millett L.J. said at page 1619:-
  141. "It is not an abuse of the process of the court or in any way improper or unreasonable for an impecunious plaintiff to bring proceedings which are otherwise proper and bona fide while lacking the means to pay the defendant's costs if they should fail. Litigants do it every day, with or without legal aid, if the plaintiff is an individual, the defendant's only recourse is to threaten the plaintiff with bankruptcy. If the plaintiff is a limited company, the defendant may apply for security for costs and have the proceedings dismissed if the plaintiff fails to provide whatever security is ordered.

    The court has a discretion to make a costs order against a non-party. Such an order is, however, exceptional, since it is rarely appropriate. It may be made in a wide variety of circumstances where the third party is considered to be the real party interested in the outcome of the suit. it may also be made where the third party has been responsible for bringing the proceedings and they have been brought in bad faith or for an ulterior purpose or there is some other conduct on his part which makes it just and reasonable to make the order against him. It is not, however, sufficient to render a director liable for costs that he was a director of the company and caused it to bring or defend proceedings which he funded and which ultimately failed. Where such proceedings are bought bona fide and for the benefit of the company, the company is the real plaintiff. If in such a case an order for costs could be made against a director in the absence of some impropriety or bad faith on his part, the doctrine of the separate liability of the company would be eroded and the principle that such orders should be exceptional would be nullified."

  142. The application of S.51 was further considered in detail by Phillips L.J. in Murphy v. Young's Brewery [1997] 1W.L.R. 1591. He said at page 1603:-
  143. "The critical question is whether the mere fact that Sun Alliance have funded the Murphys' legal expenses under a policy of insurance, up to the limit of the cover under that policy, makes it reasonable and just that Sun Alliance should be ordered to pay Young's costs"

    "Funding alone will not justify an order against the funder under Section 51. I do not consider that an order under Section 51 will normally be appropriate where a disinterested relative has, out of natural affection, funded costs of a claim or a defence that is reasonably advanced"

    at page 1604

    "An order under section 51 that a non-party pay costs will only be justified when exceptional circumstances make such an order reasonable and just. In this judgment I have explored some of the categories of exceptional circumstances that may justify such an order"

    Sir John Balcombe said at page 1604:-

    "the legal expenses insurance with which we are here concerned did not relate to a specific piece of litigation, and this distinguishes this case from one where a third party funds a particular claim and has a direct commercial interest in the outcome of that claim"

  144. For the respondents it was argued that the funding of Mr Hamilton's costs did not go beyond the "mere fact" of funding. (See also per Phillips L.J. in Tharros Shipping v. Bias Shipping [1997] 1 Lloyds's Rep 246 at p.250)
  145. In Abraham v. Thompson [1997] 4 All ER 362 Millett L.J. emphasised the importance of freedom of access to the Courts at page 379:-
  146. "It is not an abuse of the process of the court for an impecunious plaintiff to bring proceedings for a proper purpose and in good faith while being unable to pay the defendant's costs if the proceedings fail. If the plaintiff is an individual the court has no jurisdiction to order him to provide security for the defendant's costs and to stay the proceedings if he does not do so. It may be unjust to a successful defendant to be left with unrecovered costs, but the plaintiff's freedom of access to the courts has priority The risk of an adverse order for costs and consequent bankruptcy has always been regarded as a sufficient deterrent to the bringing of proceedings which are likely to fail. Where there is no risk of personal bankruptcy, as in the case of a plaintiff which is a limited company, the court has a statutory jurisdiction to award security for costs; but even in this case it will frequently not do so if this will have the effect of stifling bona fide proceedings. It is preferable that a successful defendant should suffer the injustice of irrecoverable costs than that a plaintiff with genuine claim should be prevented from pursuing it"

  147. Counsel for both Mr Al Fayed and the respondents sought support for their arguments from the judgment of Morritt L.J. in Global Equities v. Global Legal Services [1999] Building Law Reports 232 who said at p.239:-
  148. "The principal argument was directed to the question whether the circumstances in these applications could properly be regarded as "exceptional", Counsel for Miller Gardener submitted that they could not. In addition to the judgment of Balcombe LJ. in Symphony Group plc v Hodgson he referred to similar statements in Taylor v Pace [1991] BCC 406 at page 410 per Lloyd LJ. Metalloy Supplies v MA (UK) Ltd [1997] 1 WLR 1613 at page 1620 per Millett LJ. and Murphy v Young's Brewery [1997] 1 WLR 1591 at page 1604, [1997] 1 Lloyd's Rep 236 at p.244, col1, page 245, col 2 per Phillips LJ. But these statements left open the question by what standard the circumstances are to be judged in ascertaining whether they are exceptional. That question was answered by Phillips LJ. in Chapman v Christopher [1998] 1 WLR 12 at page 20 where he said:-

    "The test is whether they [see the features relied on] are extraordinary in the context of the entire range of litigation that comes to the courts.

    I would also comment that there appears to me to be a danger of treating the requirement that the circumstances are "exceptional" as being part of the statute to be applied. It is not. The epithet originates in the the first proposition enunciated by Balcombe LJ. in Symphony Group plc v Hodgson, but it is based on what Lord Goff said in Aiden Shipping Co. Ltd v Interbulk Ltd [1986] 1 AC 965, 980, [1986] 2 Lloyd's Rep 117 at p 124, col 1.

    Ultimately the test is whether in all the circumstances it is just to exercise the power conferred by subsections (1) and (3) of section 51 Supreme Court Act 1981 to make a non-party pay the costs of the proceedings. Plainly in the ordinary run of cases where the party is pursuing or defending the claim for his own benefit through solicitors acting as such there is not usually any justification for making someone else pay the costs. But there will be cases where either or both these two features are absent. In such cases it will be a matter for judgment and the exercise by the judge of his discretion to decide whether the circumstances relied on are such as to make it just to order some non-party to pay the costs. Thus, as it seems to me, the exceptional case is one to be recognised by comparison with ordinary run of cases not defined in advance by reference to any further characteristic"

    at page 240

    "I pass then to the issue of causation. In Bristol & West plc v Bhadresa (No 2) 13 November 1998, New Law Online Case 2981117704, [1999] Lloyd's Rep PN 11 at p 18, col 1 Lightman J. expressed the view that to justify an order for costs being made under section 51(1) and (3) Supreme Court Act 1981 it was necessary to consider the question

    whether and if so to what extent the conduct of [the non-party] complained of caused loss to [the Applicant] in the sense of occasioning or increasing the costs which [the Applicant] incurred in the actions.

    It was not disputed that the conduct of the non-party must have been a cause of the applicant incurring the costs it seeks to recover. For Globe it was submitted that this requirement was satisfied by the obvious fact that the costs of Globe were incurred because of the defences and counterclaims maintained by the Firm ostensibly on behalf of GLS but in substance for its own benefit. Counsel for the Firm contended that that was not enough. He submitted that all the circumstances which made the case exceptional must also be a cause of the costs sought to be recovered. He submitted that the proper question was "but for the exceptional circumstances would the costs sought have been incurred". I do not accept that submission. I accept that the costs claimed must have been caused to some extent by the non-party against whom the order is sought for otherwise it is hard to envisage any circumstance in which it could be just to order the non-party to pay them. But I do not see why they must be caused by all the factors which render the case exceptional."

  149. (See also the judgment of Auld L.J. in Cormack v. Excess Insurance C.A. Transcript 16th March 2000 at page 13)
  150. In my judgment what Morritt L.J. is saying is that the exceptionality principle is not a fetter on the exercise of the discretion but nonetheless is a very important guideline.
  151. Argument about causation had featured extensively in this case. In my judgment but for the existence of the Fund Mr Hamilton's case would not have proceeded so that by the 10th October 1999 the case was almost ready for trial the following month. The subsequent large donations were made in the belief that without further substantial funding the trial might not take place. Unknown to the donors the decision to cross the Rubicon had been taken whether or not further funding was forthcoming by Hamilton's Solicitors.
  152. If it had been just and reasonable to make a S.51 order against those funders who contributed before the 10th October 1999, in my judgment it would have been unjust and unreasonable not to have made an order against those who contributed after the 10th October 1999. The distinction is artificial. The fund-raising by Lord Harris was ongoing and repeated. Mr Hamilton's claim to clear his name could not be prosecuted and brought to a conclusion at trial without continual funding.
  153. Another argument advanced was a de minimis one. Mr Hamilton's costs so he said amounted to upwards of £1 million. An individual contributor of say £5000 was neither here nor there. As an individual contribution of £5000 did not cause Mr Al Fayed to incur any additional costs.
  154. In my judgment this argument is fallacious. The donors, large and small, were contributing as they knew to a fund expected to total several hundred thousand pounds. It was that fund that caused Mr Al Fayed to incur costs. It was the Fund to which all contributed that opened the door to his S.51 application.
  155. There were several hundred small contributors. It would have been impracticable and disproportionate that each of them should have been identified and made parties to the proceedings. A bottom floor of £5000 was reasonable as only the rich or very rich were likely to have donated that amount or more to a Fund such as this.
  156. Conclusion

  157. In reaching my conclusion to dismiss Mr Al Fayed's application in addition to the facts applicable to individual respondents I considered all the circumstances of the case including in particular the following factors which are generally applicable:-

(a) Mr Al Fayed had made the allegation that Mr Hamilton had received cash for questions, a matter of important and legitimate public interest and concern.

(b) By its verdict the Jury had found that Mr Al Fayed had justifiably accused Mr Hamilton of being corrupt as a Member of Parliament albeit that Mr Al Fayed was himself criminally corrupt.

(c) It was Mr Hamilton's choice to sue Mr Al Fayed who if he was to justify his accusation was bound to incur a very large outlay in costs which he was very unlikely to recover from Mr Hamilton as the contributors to Mr Hamilton's costs should have realised if they had thought about it.

(d) There is no indication that the respondents who are rich or very rich would suffer any hardship by contributing towards Mr Al Fayed's costs.

(e) It is unfair that a successful defendant who is unable to recover his outlay of costs from the claimant should not recover his outlay from the rich backers of the claimant who is impecunious.

(f) Mr Al Fayed's Solicitors took the proper step of warning Mr Hamilton's backers who were unknown to them that they were liable potentially to an application under S.51. It was no fault of Mr Al Fayed that backers were not alerted to this risk.

(g) Until the last minute emergence of the Mobil allegation Mr Hamilton had some realistic prospect of success viewed objectively

(h) There were grounds of public interest for deciding that in any event the dispute between Mr Hamilton and Mr Al Fayed should be conclusively decided by a Jury.

(i) It is in the public interest and the interest of justice that a litigant of limited means asserting a right against a very rich opponent should be afforded effective access to the Courts in appropriate cases.

(j) Rich philanthropists who wish out of charity to achieve (i) above and a measure of equality of arms should not be discouraged.

(k) The respondents were entitled to have regard to (h)(i)(j) above and the honest belief of Lord Harris, the fund raiser, and Mr Hamilton's Solicitors that success for Mr Hamilton was to be expected.

(l) The respondents were entitled to have regard to Mr Hamilton's persistent and consistent denial of cash for questions when having in mind Mr Al Fayed's questionable reputation for probity.

(m) Legitimate criticism was voiced as to the fairness to Mr Hamilton of the Downey Enquiry and proceedings before the Select Committee of the House of Commons.

(n) Mr Al Fayed's misuse of the witness-box to make speeches and utterly scandalous allegations irrelevant to the dispute with Mr Hamilton.

(o) Mr Al Fayed's "discreditable" conduct after the trial in acquiring the confidential papers of Mr Hamilton's Counsel.

(p) Most of the money received by Mr Hamilton's Solicitors from the respondents was donated after the Solicitors had taken the decision that the case would go ahead to trial irrespective of whether or not sufficient donations were received. That decision was unknown to the respondents who were led to believe that further donations were required to bring the case to trial.

(q) In contrast to (p) above the case of Mr Hamilton would not have proceeded to the 10th October 1999 when the stage was reached that Counsels' briefs were about to be delivered except for the existence of the Fund.

(r) If Mr Hamilton were successful the respondent's only expectation was a return of their contributions.

(s) None of the respondents took any active part in the litigation or had any detailed knowledge of the merits of Mr Hamilton's claim.

(t) Mr Al Fayed's state of mind indicating resentment as expressed to the Independent journalist on the 10th January 2000.

"I am going for the bastards who think they are members of the Establishment who pay his fees and want to bring me down. I am going for people who encourage him, like the Lord Harris and that .. Earl of Shit."

(u) At the conclusion of the trial Mr Hamilton's Counsel did not submit that costs should not follow the event or ask for a reduced cost order. I cannot with hindsight say what my reaction would have been if Mr Hamilton's Counsel had made any such submissions. In any event it is irrelevant because the respondents were not then parties to the proceedings.


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