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England and Wales High Court (Administrative Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Administrative Court) Decisions >> Taveta Investments Ltd v The Financial Reporting Council & Ors  EWHC 1662 (Admin) (29 June 2018)
Cite as:  EWHC 1662 (Admin)
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QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL
B e f o r e :
| TAVETA INVESTMENTS LIMITED
- and -
|(1) THE FINANCIAL REPORTING COUNCIL
(2) THE CONDUCT COMMITTEE OF THE FINANCIAL REPORTING COUNCIL
(3) THE EXECUTIVE COUNSEL OF THE FINANCIAL REPORTING COUNCIL
- and -
|(1) PRICEWATERHOUSECOOPERS LLP
(2) STEPHEN JOHN DENISON
for the Claimant
Charles Béar QC and James McClelland (instructed by Financial Reporting Council General Counsel) for the Defendants
Julian Randall of Taylor Wessing LLP for the First Interested Party
The Second Interested Party did not attend and was not represented
Hearing date: 21 June 2018
Crown Copyright ©
Mr Justice Nicklin :
The Financial Reporting Council
Taveta Investments Limited
The FRC Investigation
i) PwC was fined £10m, severely reprimanded and was made subject to certain conditions regarding its practice for the next three years;
ii) Mr Denison was fined £500,000, severely reprimanded, banned from performing any audit work for 15 years and undertook to remove his name from the register of statutory auditors for 15 years.
The Settlement Agreement and the Particulars of fact and acts of misconduct
27 The identity of third parties will usually be anonymised in any announcements and/or related documents published under this Publication policy, unless or to the extent that publication of that individual's identity is considered fair and necessary in all the circumstances and is in compliance with any applicable data protection laws.
28 Decisions will normally be published promptly but the Committee retains discretion to delay publishing them, or parts of them, if it considers there are public interest reasons for doing so.
29 Save where urgent publication is desirable to safeguard the public interest, any Member or Member Firm and any other party named in an announcement will be given a copy of its terms a minimum of 3 days before the making of the announcement. Advance notification will also be given to the relevant Scheme Participants and any regulatory body or prosecuting authority with a known interest in the matter in question. Amendments to the wording of press announcements will not generally be accepted, except in relation to matters of factual inaccuracy…
31 Save as otherwise set out in this Publication policy or required by law, publication will usually take the form of:
• a short statement on the FRC's website setting out the brief factual details of the decision or action in question; and
• where considered appropriate in all the circumstances, a link to any related detailed decision(s).
32 In addition, press announcements will usually be published and circulated in a manner determined by the FRC Executive. The press announcement may contain a link to the website statement and any accompanying report or document.
33 In certain circumstances and where not contravening any publication requirements under the Schemes, the FRC may decide to vary the form or procedure in which it publishes an announcement made under this policy.
"I write to you as representative of the Taveta Group, Arcadia and Sir Philip Green.
Please note, on a strictly confidential basis, that the FRC has settled regulatory action taken against PwC and [Mr Denison] in relation to the statutory audit of the financial statements of BHS. Publication of this outcome by the FRC is intended to take place on Wednesday 13 June at 7am.
In line with our Publication Policy, as the above corporate entities and Sir Philip are identified in the documents intended to be published, I attach an advance copy of our proposed press release which will link to the attached settlement agreement and statement of facts.
Amendments to the wording of the press notice and documents will not generally be accepted, except in relation to matters of factual inaccuracy. Please inform us by 2pm on Tuesday 12 June if there are any accuracy concerns you would like us to take into consideration…" (emphasis in original)
"… Ms Cooper has forwarded to us your email to her dated 8 June 2018 concerning the proposed press notice relating to your investigation into [PwC and Mr Denison].
I left a voicemail for you on Friday afternoon. My clients and I urgently need to speak with you in order to discuss the content of the documents attached to your email and their very serious concerns in relation to the content of those documents. Please may we speak at 9am on Monday morning? My clients would also intend to attend that call. I should be grateful if you would confirm your availability as soon as possible and I will circulate a dial in."
"… I am sorry that we are not able to join a call at 9am tomorrow. Please instead set out the concerns you refer to in writing for our consideration and so that we can reflect if a call would be helpful and who should attend once those concerns have been articulated.
Please note in doing so that the documents linked to the proposed press notice are not FRC documents; they are documents (a settlement agreement and agreed statement of facts and misconduct) agreed by the parties to a disciplinary action… and approved by a member of an independent tribunal panel. For that reason when publishing enforcement outcomes, the FRC can invite factual accuracy comments only, not comments as to substance agreed and approved by the parties. [A link was given to the Publication Policy]."
"You must be aware that your report will attract significant attention. This knowledge should heighten the obligation on you to be factually accurate and careful not to cause damage. Publishing a report in the form provided to our client today has potential to be very damaging to not only the relevant individuals but also their businesses and the many thousands [of] employees of those businesses.
There is absolutely no need for the documents published to contain criticism of anyone other than the subjects of your investigation. Our clients were not the subject of your investigation and have the right not to be criticised by you to bolster your findings against PwC and Mr Denison. All such criticism should be removed from the documents that you put into the public domain.
It is imperative that our clients have a proper opportunity to correct the inaccurate factual statements in the documents and to address the unwarranted criticism of them. The time you have afforded them to do that is insufficient and entirely unreasonable. Our clients have no wish to interfere in your process… but will now work diligently to provide you with details of each inaccuracy and potentially prejudicial comment which needs to be addressed to ensure no unfair harm should raise. However, this requires a more reasonable period of time to be afforded to them."
The letter concluded by stating that representations would be provided by 5pm on Friday 15 June 2018 and by requesting an undertaking that the documents would not be published pending receipt of representations. In default of provision of the requested undertaking by 2pm on Monday 11 June 2018, the Claimant's solicitors advised that an application would be made to Court to prevent publication.
"This press release, the Settlement Agreement and the [Particulars] do not make (and nor would it be fair to treat any part of these documents as constituting or evidencing) findings against any individual or entity other than PwC and/or Mr Denison"
The Claim for Judicial Review and the Interim Application
"Given that the matters at issue between the Claimant and the FRC concern the contents and publication of a settlement agreement and associated documents, it is open to the FRC to publish the fact of the settlement and the regulatory outcome on Thursday but without the documents in issue. Whilst we would prefer, in the interests of transparency and fairness to publish the outcome with the relevant documentation we cannot, on the FRC's behalf, argue that prejudice would be caused. To be clear, if there is to be any delay caused to the Claimant's application we will proceed to publish the outcome only on Thursday with the associated documents to follow as soon as possible.
However, we anticipate that the [Interested Parties] to the FRC matter would argue that any delay would be severely prejudicial to them. This is not least because there has been a leak and the fact of the settlement is in the public domain. Further, for the outcome to be published without the associated documents which provide the context to the admissions and regulatory sanctions could also be prejudicial…"
"You will be aware that the fact of the settlement agreement and the sanctions imposed on the [Interested Parties] was leaked to the press earlier today. We do not know the source of the leak. Following the breaking of the story and with the agreement of [the Interested Parties] we published confirmation of the regulatory outcome. Our press release can be found at [website address given]."
"I mentioned in my email yesterday that the fact of the settlement had been leaked to the press. In light of the leak and further press coverage yesterday evening, the FRC brought forward its press announcement and last night published the fact of the settlement and the sanctions imposed against PwC and Mr Denison. These have been widely reported in the press (including the BBC and The Times). Whilst the FRC had originally intended to publish the settlement agreement (which contains the passages objected to by the claimant) at the same time as it published the fact of the settlement and the sanctions, given the combination of the leak and the ex parte order made yesterday, this is obviously now impossible. It follows that the urgency has unavoidably receded. At the same time, it will be impossible for the FRC to marshal its evidence in time for the deadline at 4.30pm today.
The FRC obviously wishes to proceed to deal with the interim position at an inter partes hearing as soon as possible, and suggests a hearing be fixed if possible on Monday 25 June 2018. This would allow the FRC time to marshal its evidence in response to the application and give the Claimant an opportunity to file evidence in reply.
On the basis that a hearing can be arranged in that timeframe, the FRC will undertake not to publish any information relating to the settlement insofar as the information contains or refers to express or implied criticism of the Claimant… until the conclusion of the hearing."
The Hearing on Friday 15 June 2018
"If the parties – including the interested parties – cannot agree (a) an order that the hearing of the application be fixed as indicated above; and/or (b) what (if any) restrictions there should be on publication of [the alleged criticisms] in the meantime – then the Judge is prepared to hear the parties at 2.30pm today… At the hearing any disputed issues can be resolved. For reasons of complexity, practicality and open justice, the Judge is not prepared to deal with this matter on paper. In light of Taylor Wessing's letter, the Judge considers that PwC has a very real interest in what order should be made. That is before any wider consideration of the public interest as a result of the announcement of sanction earlier this week… If the parties are not able to reach an agreed order (acceptable to the Judge) and no hearing takes place, the restrictions imposed by the Order of 12 June 2018 will lapse. Given the importance of the issues, the Judge is not prepared to allow the interim restriction on publication to continue by default…"
Responses from the parties were requested by 2pm.
"The FRC has now considered the Judge's proposed direction. In addition, there has been a further practical development which is that the fact of Taveta's challenge has been leaked to the media. At 11.30am today Sky News reported the challenge. Neither the FRC nor Taveta commented to Sky News. The report… illustrates the strong public interest in having the reasons behind the FRC's sanction of PwC made public…
In all the circumstances, including today's further publication, the FRC considers that it must invite the Court to reconsider the principle of interim relief pending a return date. The FRC considers that an injunction of this kind, restraining a regulator from publishing its reasons for decision in the exercise of its public enforcement powers, on a matter of considerable public interest, should only be granted if a strong prima facie case is shown. [Taveta] has not made out such a case in the light of, among other things, the recent decision of the High Court in R (Lewin) -v- FRC … which decides that the appropriate protection for a third party such as [Taveta] is to include an appropriate disclaimer (or other explanation) in the text of the published materials. The FRC offered such a disclaimer before the issue of proceedings but [Taveta] refuses it in principle…
Accordingly and without prejudice to other grounds for resisting the claim and the application, the FRC's position is that no interim relief should be granted.
If the Court were to take a different view, then the FRC would wish to make submissions on: (1) the date for the hearing, which should be set so as to involve the bare minimum of delay consistent with allowing it an opportunity to submit evidence; and (2) whether it should be permitted to provide the full reasons for its decision… to the Select Committee for Work and Pensions (as requested on behalf of that Committee) and if so, under what conditions. The FRC would normally seek to cooperate with other public agencies and would wish to do so in this case."
Hearing in Private and restrictions on access to the Court file
Taveta's claim for judicial review
i) the FRC intends to publish the Sanction Documents, in particular the Particulars, which contain the alleged criticisms ("the Publication Decision"); and
ii) the Publication Decision is unlawful because Taveta has not been given a fair opportunity to make representations as to the alleged criticisms.
i) On 12 June 2018, the Claimant's solicitors invited the FRC to "confirm that the FRC is not restricted to making changes only in relation to matters of 'factual accuracy' and that the FRC will consider all of the representations from the Claimant (as set out in our letter dated 12 June) and to make such changes as it fairly and reasonably considers appropriate to any of the documents sent on 8 June in the light of such representations".
ii) The FRC replied that "many of the points raised in your correspondence will be addressed in our response to your application [for judicial review] which we are preparing and on which, you will appreciate, we must now focus".
iii) On 13 June 2018, the Claimant's solicitors proposed that the time before the application could be heard could be used, "to work with you to ensure that the points we have made are fully understood. It is clearly in everyone's interest that any material placed in the public domain is accurate and not unfair to third parties who were not the subject of your investigation".
iv) No response was received until 18 June 2018, when the Claimant received the witness statement of Ms McArthur, which appended a schedule setting out "the FRC's responses" to the Claimant's representations ("the Schedule"). Save in two very minor factual respects, all the submissions made by Taveta were rejected and the FRC refused to make any alterations to the Sanction Documents. I deal with the Schedule in more detail in the Appendix to the judgment.
The parties' submissions
i) the Particulars contain serious criticisms of Taveta, its directors and its employees;
ii) there is plainly a duty of fairness owed by the FRC in this case;
iii) the duty was breached by the decisions to agree the text of and/or to publish the Sanction Documents without first giving Taveta a proper and fair (or indeed any) opportunity to respond to the criticisms;
iv) the breach cannot be said to have made no difference; at the very least, had it been given an opportunity to make representations at a stage when the decision-makers had an open mind, there are points that could have been made which might have made a difference, which is sufficient for present purposes.
v) the breach has not been cured by anything that has happened after the Publication Decision: (a) the correct individuals, including the independent tribunal member, have not considered the Claimant's representations; (b) those individuals within the FRC who have considered the representations have not done so with an open mind, as the responses in Ms McArthur's schedule reveal; and
vi) the proposed Disclaimer does not and cannot satisfy the duty of fairness.
i) the Scheme makes no provision for the involvement of third parties in the processes of investigating, settling or adjudicating upon alleged disciplinary breaches by members of its regulated community;
ii) such third-party participation would be totally impractical;
iii) this case had proceeded by way of settlement, but Taveta would have had no right to be heard before the Tribunal and consequently, a fortiori, it has no right to be heard before the Third Defendant accepted admissions from the target(s) of a complaint;
iv) as regards the decision to publish the Sanction Documents, under the Scheme, the FRC is under a duty to publish and there is a compelling public interest in openness and transparency in the regulation of those who participate in financial markets;
v) any duty of fairness that the FRC is under as regards Taveta is satisfied by the publication of the Disclaimer with the Sanction Documents; and
vi) in any event, the FRC has now considered Taveta's representations and has therefore discharged any duty of fairness.
The Regulatory Context
i) In 2003, the EU Commission issued a Communication to the Council and European Parliament titled "Reinforcing the statutory audit in the EU". In it, the Commission noted that investors' confidence in capital markets worldwide had been eroded and that public credibility of the audit profession has been impaired. In relation to the role of disciplinary sanction and publication, it noted:
"Systems of disciplinary sanction are an important instrument to correct and prevent inadequate audit quality. At the same time they are also a means for the audit profession to demonstrate its public credibility… the Commission will consider further steps towards the convergence of disciplinary procedures, notably with regard to transparency and publicity… In particular, systems of disciplinary sanctions should be subject to external public oversight… The existing requirement for appropriate sanctions in the 8th Directive will be reinforced by requiring that all Member States will have an appropriate and effective system of sanctions."
ii) Following further proposals and consideration, the public interest in publication and transparency in relation to the regulation and oversight of statutory audit was recognised in the EU Directive 2006/43/EU. Recital 9 of which provided:
"The public interest function of statutory auditors means that a broader community of people and institutions rely on the quality of a statutory auditor's work. Good audit quality contributes to the orderly functioning of markets by enhancing the integrity and efficiency of financial statements."
Article 30 states:
"Systems of investigations and penalties
(1) Member States shall ensure that there are effective systems of investigations and penalties to detect, correct and prevent inadequate execution of the statutory audit.
(2) Without prejudice to Member States' civil liability regimes, Member States shall provide for effective, proportionate and dissuasive penalties in respect of statutory auditors and audit firms, where statutory audits are not carried out in conformity with the provisions adopted in the implementation of this Directive.
(3) Members States shall provide that measures taken and penalties imposed on statutory auditors and audit firms are appropriately disclosed to the public.
iii) The subsequent EU Directive 2014/56/EU promulgated more detailed rules. Article 30a requires 'competent authorities' (in the UK, the FRC) should have powers to take measures and sanctions which include publication of statements indicating the person sanctioned and the nature of the breach on their websites. Article 30(c) provided:
"Publication of sanctions and measures
… Competent authorities shall publish on their official website at least any administrative sanction imposed for breach of the provisions of this Directive or of Regulation (EU) No.537/2014 in respect of which all rights of appeal have been exhausted or have expired, as soon as reasonably practicable immediately after the person sanctioned has been informed of that decision, including information concerning the type and nature of the breach and the identity of the natural or legal person on whom the sanction has been imposed."
These measures reflect recital (1):
"… in order to reinforce investor protection, it is important to strengthen public oversight of statutory auditors and audit firms by enhancing independence of Union public oversight authorities and conferring on them adequate powers, including investigative powers and the power to impose sanctions with a view to detecting, deterring and preventing infringements of the applicable rules in the context of the provision by statutory auditors and audit firms of auditing services."
Do the Particulars contain criticism of Taveta?
i) although it may contain several imputations, the Particulars will convey a single natural and ordinary meaning (the so-called 'single-meaning'): Slim –v- Daily Telegraph  2 QB 157, 173D-E per Lord Diplock;
ii) the natural and ordinary meaning is the objective meaning that the hypothetical ordinary reasonable reader would understand the Particulars to bear Lachaux -v- Independent Print Limited  QB 402 [15(2)] per Davis LJ;
iii) the single natural and ordinary meaning is assessed by the Court using the principles identified in Jeynes -v- News Magazines Ltd  EWCA Civ 130  per Sir Anthony Clarke MR;
iv) in assessing meaning, no evidence beyond the words complained of is admissible: Charleston –v- News Group Newspapers  2 AC 65, 70 per Lord Bridge;
v) the ordinary reasonable reader is taken to have read the whole of a publication. That is important, because the context in which the words complained of appear will often influence the meaning: Bukovsky -v- Crown Prosecution Service  EMLR 5 - per Simon LJ;
vi) this principle is particularly important in 'bane and antidote' cases. Where the publisher relies upon some words to draw the sting of what otherwise would be a defamatory statement of the claimant, the bane and antidote must be read together: Cruise -v- Express Newspapers plc  QB 931, 939A per Brooke LJ; but cases where the defamatory meaning will be wholly removed by the antidote are rare: Stern -v- Piper  QB 123, 136B per Simon Brown LJ;
vii) the meaning the publisher intended to convey is irrelevant: Cassidy -v- Daily Mirror  2 KB 331, 354 per Russell LJ;
viii) for a viable defamation claim, the words complained of must refer to the claimant. The claimant need not be named; the question is whether reasonable people would understand the words to refer to the claimant: Lachaux [15(1)] per Davis LJ;
ix) a meaning is defamatory of the claimant if (1) objectively judged, it substantially affects in an adverse manner the attitude of other people towards him, or has a tendency so to do: Thornton -v- Telegraph Media Group Ltd  1 WLR 1985  per Tugendhat J; Lachaux [15(5)] per Davis LJ; and (2) the requirements of s.1 Defamation Act 2013 are satisfied; and
x) the Particulars may contain additional meanings that are defamatory of particular individuals as a result of particular facts known to some, but not all, readers of the Particulars; these are innuendo meanings: Grubb -v- Bristol United Press  1 QB 309, 327 per Pearce LJ. For example, some readers will be familiar with the particular legal duties owed by directors of companies and if, when they read the Particulars, they consider that they allege that Taveta Personnel have breached those duties, the individuals referred to would also have a complaint based on that further innuendo meaning.
i) The Particulars and Settlement Agreement in their current form make implied criticisms of the Taveta Personnel. I have found that they bear a meaning which is capable of defaming them (Appendix [A12]). Were they to be published in that form, then there is a serious issue to be tried as to whether they would defame the Taveta Personnel in the meaning that I have found. Objectively judged, that meaning would be serious and arguably satisfies the requirements of s.1 Defamation Act 2013 (Appendix [A15]).
ii) It is well arguable that the Disclaimer is ineffective to remove the defamatory character of the Particulars when taken as a whole; that the antidote does not remove the bane.
iii) The publication is also likely to convey other innuendo meanings defamatory of the Taveta Personnel, but I cannot assess the viability of such claims without an investigation into the legal duties owed by particular Taveta Personnel.
Duty of fairness
"The inspectors can obtain information in any way they think best, but before they condemn or criticise a man, they must give him a fair opportunity for correcting or contradicting what is said against him. They need not quote chapter and verse. An outline of the charge will usually suffice."
"… I would accept that it is the duty of the commissioners to observe the rules of natural justice in the course of their investigation – which means no more than that they must act fairly by giving to the person whose activities are being investigated a reasonable opportunity to put forward facts and arguments in justification of his conduct of these activities before they reach a conclusion which may adversely affect him."
i) Taveta is not regulated by the FRC; is not subject to the Scheme (or the penalties available under it); has never been (and never could be) the subject of an FRC investigation; and was not party to the Settlement Agreement.
ii) The Settlement Agreement resulted in the Particulars which are a record of the admissions made by the Interested Parties. From this it is clear that they record admissions made under the Scheme to which Taveta is not subject, at the end of a process to which Taveta was not party and presented in a document which Taveta has not approved.
iii) The Particulars themselves identify breaches by the Interested Parties. Reference to third parties is merely to provide the essential factual background to and context for the admissions which the Interested Parties have agreed to make.
i) The principle applies to all inquiries, investigations and reviews: Pergamon pp.402H-403C; R -v- Race Relations Board, ex parte Selvarajan  1 WLR 1686, 1693H-1694D; and Re R  EWHC Admin 571 .
ii) The principle applies to both natural and legal persons: R -v- Secretary of State for the Environment, ex p Hammersmith and Fulham LBC  1 AC 521, 598F; and R -v- Commission for Racial Equality, ex parte Westminster CC  ICR 827, 841B-C.
iii) The principle applies to any criticism that may adversely affect a person's interests (including in that term career or reputation): Mahon -v- Air New Zealand Ltd  AC 808, 820H; Selvarajan at p.1693H-1694D. This includes criticisms against a company, its directors or employees that could lead to litigation: Pergamon p.407B.
iv) The principle requires a fair opportunity to respond, including in particular (a) sufficient information about the proposed criticisms so that the subject knows what is being alleged against him, and (b) sufficient time to respond: Maxwell p.538H; Pergamon p.400A; Furnell -v- Whangarei High Schools Board  AC 660, 685A. In Re R, Collins J encapsulated it thus :
"Fairness does not require that a person to be criticised knows from whom or from what source or why those criticisms have been made. What he needs to know is that the criticism has been made and what that criticism is and to be given sufficient information about it to enable him to deal with it and to make the necessary investigations on his own side and to come up with any explanations or to set right any errors of fact which may lie behind it…"
v) To be fair, the opportunity to respond must be given before the decision-maker has reached a concluded view. If an opportunity to respond to criticisms is given to a witness when giving evidence to an inquiry, the decision-maker need not put its tentative conclusions to the witness to allow further comment: Maxwell p.534B-D. But if the decision-maker proposes to criticise a third-party who has not given evidence or had proposed criticisms put to him, he must be given an opportunity to respond before the decision-maker reaches a concluded view.
vi) A claimant need only show that his representations might have made a difference: Mahon -v- Air New Zealand Ltd at p.821B.
i) since the disciplinary tribunal had been required to investigate the nature and extent of the fraud at the company to determine whether there had been any culpability on the part of either the accountancy firm or its partner, it had been required to express a view in its report on the claimant's conduct ;
ii) there was nothing in the Scheme which permitted the sending of a draft report, or part of it, to a non-party to invite comments , ;
iii) the tribunal was fuctus officio once it had concluded its final report; it could not re-write it or change parts of it ;
iv) the claimant's interest in protecting his reputation was adequately protected by the law of defamation, specifically s.15(1) Defamation Act 1996 and Paragraph 14(b) of Schedule 1 Part II (fair and accurate reports subject to explanation or contradiction) ;
v) Article 8 may protect a person against an attack on his reputation, but only if it is a serious interference with his private life so as to undermine his personal integrity and the claimant had provided insufficient evidence to support such a level of interference ; the criticism of the claimant related to his professional role in a public company and so did not represent a serious interference with his private life ;
vi) any interference in the claimant's Article 8 rights was justified by the Article 10 rights of the public generally to receive information about the outcome of disciplinary proceedings in public ; and
vii) given the constraints of the Scheme and the gravity of the findings against the claimant, fairness required the tribunal to set out, at the beginning or end of the report, the Disclaimer .
i) the FRC could include in a Tribunal Report, or in particulars of fact and misconduct as part of a settlement agreement, findings that were seriously defamatory of a third party (and potentially false), the publication of which would cause serious reputational harm to that third party;
ii) in such a case the FRC was under no duty to permit the third party an opportunity to make submissions to the FRC before publication of these findings; and
iii) the interests of the third party were adequately protected by (a) the publication of the Disclaimer; (b) the potential availability of a remedy in judicial review proceedings of a declaration that the allegations should not have been published; and (c) the right of explanation of contradiction in respect of reports of the Particulars under s.15 Defamation Act 1996.
i) The fact that the FRC has a remit only over auditors and actuaries does not mean that it does not have a duty to act fairly to other third parties if it intends to publish criticisms of them. Nicola Davies J accepted that proposition . An organisation discharging functions like the FRC does not need be given specific rules or powers to act fairly; it has a public law duty to do so and such powers as are required to do so would necessarily or readily be implied.
ii) I do not believe that Lewin is authority that the duty of fairness can, in all cases, be satisfied by publication of a disclaimer. If it were, then respectfully I would disagree. Whether any particular form of wording in a disclaimer will act as a sufficient antidote to extinguish the defamatory imputation(s) contained in a publication (such as to obviate the need to give the third party a right to comment on the imputation(s)) must be a matter of fact and degree, depending on upon the well-established rules of meaning I have already set out (see  above) and common sense.
iii) The reputational interests that are engaged by the threatened publication of a report which is capable of bearing defamatory imputations of third parties are sufficient to engage the duty of fairness (see [67(iii)] above).
iv) The Article 10 rights of the regulator and/or the public cannot extinguish any duty of fairness that arises. Further, if a failure to give a third party the opportunity to comment on proposed criticisms leads to the publication of allegations that are false, the public interest is damaged (see  below). Any balancing of competing rights under Article 10 and Article 8 arises only once the "regulator" (a term I will use as shorthand for the body or individual publishing the report) has offered the third party the opportunity to comment and considered those representations. The representations may cause the regulator to revise or remove its criticism. It is at that stage that the regulator balances the competing rights, applying an intense focus to the respective rights and deciding the proportionality of and justification for the respective interference (In Re S (A Child) (Identification: Restriction on Publication)  1 AC 593 ). The assessment is for the regulator, but the question is: is it necessary to include the criticism of the third party in the report? In the current case, in my judgment the answer may well be found to be no. It would be possible to publish the Particulars in an amended form which would not bear a meaning capable of defaming the Taveta Personnel.
v) The most significant differences between the current case and Lewin are that the FRC does not contend that it is essential to include any criticism of Taveta or Taveta Personnel to understand the allegations made against the Interested Parties, and it positively disavows any intention to publish any criticism of them.
vi) Perhaps because the Court did not have detailed submissions on the point, but the effectiveness of any remedy provided by s.15 Defamation Act 1996 is significantly overstated in Lewin.
a) The section would apply only to fair and accurate reports of the FRC's Particulars. It would give Taveta the opportunity to request (not require) the publisher of such a report (e.g. a newspaper) that it publish "in a suitable manner a reasonable letter or statement by way of explanation or contradiction". If the newspaper "refused or neglected" to publish Taveta's letter or statement, then it could not avail itself of a defence under s.15(2) to the publication of any defamatory imputations contained in its report. But a newspaper might look elsewhere for its defence to any action for defamation (e.g. s.4 Defamation Act 2013). It is unlikely that the publication of any letter or statement by way of explanation or contradiction would be read by all of those who read the original report.
b) More importantly, it is highly arguable that the section does not apply to publication of the Particulars by the FRC. Taveta has no right to request (still less to require) that the FRC publish anything by way of explanation or contradiction. Seeking the publication of explanations or contradictions in newspapers that report any defamatory imputations in the Particulars might be of limited use if the Particulars can continue to be published by the FRC on its website, without any explanation or contradiction.
vii) A subsequent finding in a judicial review claim that the inclusion in a report of defamatory imputations against third parties is unlawful is unlikely to be an adequate remedy for any reputational harm that will have been occasioned:
a) the court is unlikely to determine the truth or falsity of the allegation that had been included in the report; the decision will be limited to the lawfulness of the decision to include the material;
b) the overwhelming likelihood is that any subsequent finding of the Administrative Court will not receive anything like the publicity that will have attended the publication of the original report; and
c) damages for injury to reputation are not available.
"Reputation is an integral and important part of the dignity of the individual. It also forms the basis of many decisions in a democratic society which are fundamental to its well-being: whom to employ or work for, whom to promote, whom to do business with or to vote for. Once besmirched by an unfounded allegation in a national newspaper, a reputation can be damaged for ever, especially if there is no opportunity to vindicate one's reputation."
The position is a fortiori where the reputation is damaged by publication of defamatory allegations by a body like the FRC, which is discharging a regulatory role of significant public interest (see - above) and whose decisions are likely to be regarded as authoritative. Lord Nicholls continued:
"When this happens, society as well as the individual is the loser. For it should not be supposed that protection of reputation is a matter of importance only to the affected individual and his family. Protection of reputation is conducive to the public good. It is in the public interest that the reputation of public figures should not be debased falsely. In the political field, in order to make an informed, choice, the electorate needs to be able to identify the good as well as the bad. Consistently with these considerations, human rights conventions recognise that freedom of expression is not an absolute right. Its exercise may be subject to such restrictions as are prescribed by law and are necessary in a democratic society for the protection of the reputations of others."
To like effect, Lord Hobhouse said (at p.238A-C):
"The liberty to communicate (and receive) information has a similar place in a free society but it is important always to remember that it is the communication of information not misinformation which is the subject of this liberty. There is no human right to disseminate information that is not true. No public interest is served by publishing or communicating misinformation. The working of a democratic society depends on the members of that society, being informed not misinformed. Misleading people and the purveying as facts statements which are not true is destructive of the democratic society and should form no part of such a society. There is no duty to publish what is not true: there is no interest in being misinformed. These are general propositions going far beyond the mere protection of reputations."
 …in the absence of good reason a Judge ought to be extremely cautious before making conclusive findings of fraud unless the person concerned has at least had the opportunity to give evidence to rebut the allegations. This is a matter of elementary fairness. In Vogon International Ltd -v- the Serious Fraud Office  EWCA Civ 104  May LJ (with whom Lord Phillips MR and Jonathan Parker LJ agreed) said,
"It is, I regret to say, elementary common fairness that neither parties to the litigation, their counsel nor judges should make serious imputations or findings in any litigation when the person concerned against whom such imputations or findings are made have not been given a proper opportunity of dealing with the imputations and defending themselves."
 This is not only required because of fairness to the party affected but also to avoid the Court falling into error... As Megarry J memorably said in John -v- Rees  Ch 345, 402,
"As everybody who has anything to do with the law well knows, the path of the law is strewn with examples of open and shut cases which, somehow, were not; of unanswerable charges which, in the event, were answered; of inexplicable conduct, which was fully explained…Nor are those with any knowledge of human nature who pause to think for a moment likely to underestimate the feelings of resentment of those who find that a decision against them has been made without their being afforded any opportunity to influence the course of events".
Has there been a breach of the duty of fairness?
"It is recently our practice to also give advance notice to certain third parties reasonably identifiable in or by the press notice or associated published documents to mitigate the risk of challenge or complaint. In this case, some third parties have been anonymised but some third parties are identifiable. We have assessed the risk of challenge from most of those identifiable parties as low but would recommend providing advance notice of publication to the following key parties identifiable in the documents: The Taveta Group (including Taveta 2 and Arcadia), Sir Philip Green, [a named director of Taveta] and BHS."
"The third parties notified… were in each case named in the [Particulars], albeit they were not named as the subject of criticism. The FRC was, of course, aware that certain parts of the material to be published could potentially be used as a basis on which to criticise persons concerned in BHS's accounts."
i) the FRC has not fairly considered the submissions that Taveta have made since commencement of the claim for judicial review: it is in, he says, "litigation mode"; and, in any event
ii) the FRC has provided no evidence that the decision maker (i.e. the person(s) at the FRC who authored the Particulars) had considered the submissions; the available evidence suggests that only Ms McArthur has done so.
 I might have accepted that submission if there had been any evidence that a properly authorised inspector had carried out, in a fair, open-minded and comprehensive manner, a genuine review of the case in the light of all the evidence that has emerged since the 28th March 2003. There is no evidence that such a review has been carried out. Firstly, there is no indication that Mr. Dunn, or any other inspector, has been involved in the decision making process since 29th August 2003. Although the revocation notice of that date was signed by Mr. Frost, Mr. Dunn's Witness Statement explains that he did so during Mr. Dunn's absence on leave and following Mr. Dunn's "consideration and assessment that such action was appropriate". No documents have been disclosed relating to Mr. Dunn's consideration and assessment at that time, so it is not possible to ascertain the basis upon which he was so satisfied. There is nothing to indicate that Mr. Dunn, or any other inspector has considered Mr. Church's reports.
 Secondly, there is a world of difference between carrying out a genuinely open-minded review, and striving to defend an earlier decision in the context of adversarial litigation. Reading Mr. Smith's evidence as a whole leaves me in no doubt that it is the latter, rather than the former, exercise that has been carried out by officials on behalf of the Defendant in these proceedings. I have reached this conclusion for the following reasons: …
iv) The reaction to new evidence has not been one of genuine reappraisal, but a dogged determination to uphold the original decision…
i) In my judgment, the clearest indication that the FRC is currently operating with a closed mind is the, almost dogged, refusal to countenance any changes to the Particulars in response to Taveta's submissions (see the Schedule). I have explained in the Appendix why the particular wording of the Particulars gives rise to implied criticism of Taveta and Taveta Personnel. These points are not subtle, and Taveta's solicitors have made the objections clear. The FRC's original position was a denial that the Particulars contained any criticism of Taveta. But that position was abandoned at the hearing in favour of the alternative submission that the Disclaimer was the answer to all of Taveta's complaints.
ii) I am also satisfied that there is substance in the point that the FRC has not submitted any evidence that the points raised by Taveta have been considered by the original authors of the Particulars. It is right to note that the FRC submits that the Particulars are a product of agreement between the FRC and the Interested Parties. But within that bilateral arrangement, PwC has indicated that it does not oppose the alterations suggested by Taveta, so it is a question of whoever on the FRC's side who negotiated the Particulars considering whether they could be reworded to accommodate the concerns that have been identified. Mr Denison would need to be consulted, but the reality of the matter is that the changes that Taveta seek are not going to affect either PwC or Mr Denison. It is a striking feature of this case that Taveta is not seeking to change any of the criticisms of the Interested Parties in the Particulars.
"The test that has to be satisfied by the claimant on any application for an injunction to restrain the exercise of free speech before trial is that he is 'likely to establish that publication should not be allowed': [s.12(3)]. This normally means that success at trial must be shown to be more likely than not: Cream Holdings… In some cases it may be just to grant an injunction where the prospects of success fall short of this standard; for instance, if the damage that might be caused is particularly severe, the court will be justified in granting an injunction if the prospects of success are sufficiently favourable to justify an order in the particular circumstances of the case: see Cream at , . But ordinarily a claimant must show that he will probably succeed at trial, and the court will have to form a view of the merits on the evidence available to it at the time of the interim application."
i) Taveta is not seeking prohibition of the Sanction Documents in their entirety, simply the parts "that contain or refer to express or implied criticisms of the Claimant and/or any of its directors and/or employees." I am satisfied that it would be a relatively simple exercise for the FRC to make what would amount to limited changes to the text of the Particulars and which would then enable publication of the Particulars and the Settlement Agreement in a form which would not publish the alleged criticisms. As such, the real question is whether Taveta is likely to succeed in demonstrating that publication of the alleged criticisms is not allowed. This is a much narrower and focused question than whether the entire Sanction Documents can be published.
ii) If published in their current form, the Particulars and Settlement Agreement will make implied criticisms of the Taveta Personnel which are capable of defaming the Taveta Personnel in a meaning that would be serious and arguably satisfies the requirements of s.1 Defamation Act 2013 (see [61(i)] above and Appendix [A12]-[A15]).
iii) This is sufficient arguably to impose a duty of fairness upon the FRC to give Taveta a fair opportunity to respond to the implied criticism (see - above).
iv) There is a serious issue to be tried whether FRC has failed to comply with that duty of fairness (see - above).
v) I am satisfied that the consequences for the Taveta Personnel from publication, particularly given the lack of an adequate remedy for any wrongful reputational harm that might be caused (see [75(vi)] and ), are sufficiently serious as to justify interim relief.
vi) If the Court does not grant interim relief, and publication of the unamended Sanction Documents then takes place, then the purpose of these judicial review proceedings will substantially have been rendered nugatory. A declaration, later, that the FRC's decision to publish was unlawful is arguably not an adequate remedy (see [75(vii)] above).
vii) The hearing of the substantive judicial review claim could be expedited so as to limit the interference with the Article 10 rights of the FRC and the public.
i) there is a significant public interest in publication of reports by public bodies, particularly when they are under a duty to publish (; Cambridge Associates in Management -v- Ofsted  EWHC 1157 (Admin) ; and R (City College Birmingham) -v- Ofsted  ELR 500 ;
ii) in such cases the grant of an injunction requires "pressing grounds": R (Matthias Rath BV) -v- Advertising Standards Authority  EMLR 22 ; "the most compelling reasons [are required] to prohibit a public body which is embarked on a quasi-judicial task… from publishing its decision": R (Debt Free Direct Ltd) -v- Advertising Standards Authority  EWHC 1337 (Admin) ; or "exceptional circumstances" R (J) -v- A  EWHC 2609 (Admin) ;
iii) where, as in Taveta's case, what is sought to be restrained is allegedly defamatory allegations, then the Court should have regard to the fact that, in private law cases, the principle in Bonnard -v- Perryman  2 Ch 269 would usually prevent the grant of an order to restrain publication of defamatory statements where the respondent contends that the proposed publication was defensible: ; and R -v- Advertising Standards Authority ex parte Vernons Organisation Ltd  1 WLR 1289, 1293E-1294B.
"… [Counsel for the ASA contends] that there is nothing in [Vernons'] application except a bare desire to protect reputation, and that would not be protected by an interlocutory injunction in an analogous case where the respondent was a newspaper, as one can see from the libel cases to which I have referred.
[The ASA] submitted, in my judgment correctly, that the real heart of the case lies in [Vernons'] second point. Is there here a set of circumstances which disengages the general principle that the courts will not prevent the publication of opinion or the dissemination of information save on pressing grounds? ... If a private individual will not be restrained from expressing his opinion save on pressing grounds I see no reason why a public body having a duty, other things being equal, to express its opinion should be subject to any less rigid rules. It seems to me that the case is, if anything, analogous to one where an administrative body has an adjudicative function and in the course of its duties publishes a ruling criticising some affected person and the ruling is later disturbed or reversed by an appropriate appellate process. There are many such instances and many of them involve the criticism of members of the public, corporate or natural.
I do not know of an instance in which a public body of that kind would fall to be restrained from carrying out what is no more nor less than its ordinary, but important, everyday duties simply upon the grounds that the intended publication contains material which is subject to legal challenge as being vitiated by some error of law. If the application for judicial review here is successful I cannot think but that there are ample means at the applicant's disposal to correct any adverse impression which what, ex hypothesi, would be an unlawful report may have given to the public. Indeed, though it has not been canvassed in argument, I know of no reason why the fact that they have obtained leave should not itself be disseminated if they wish to take any steps in that direction since this is an attempt to prevent the public and indeed, in fairness to the applicant, its fellow advertisers and others in the trade to which it belongs from seeing that the authority has reached these conclusions. I do not consider that the effects of that publication are damaging to the applicant in a manner which would be so irreparable, so past recall as to amount to a pressing ground, in the language of Strasbourg, a pressing social need, to restrain this public body from carrying out its function in the ordinary way."
i) Although the principle from Bonnard -v- Perryman has been approved, post-Human Rights Act 1998, by the Court of Appeal in Greene -v- Associated Newspapers  QB 972, one of the bases of doing so was that the determination of meaning (so often the heart of a defamation claim) was reserved to the jury (). The Court distinguished the authority of In re S (A Child), stressing "the distinction between a defamation case (where the claimant's right to a reputation has been put in issue and the issue cannot be effectively resolved before the trial) and a case which raises direct issues of privacy or confidentiality" -.
ii) Since the decision in Greene, the right to trial by jury in defamation claims has been removed (s.11 Defamation Act 2013). A key plank of the justification for retaining the rule in Bonnard -v- Perryman has therefore gone. In any event, when an issue arises in public law proceedings concerning the alleged publication of defamatory statements, the matter has always been resolved by a judge sitting alone and not by a jury.
iii) Application of the rule in Bonnard -v- Perryman and (the equivalent, in public law) Vernons gives a presumptive priority to Article 10 (freedom of expression) right over Article 8 (including the right to reputation). It has been held in private law litigation that such presumptive priority is not justifiable, being inconsistent with the jurisprudence of the ECHR: Douglas -v- Hello! Ltd  QB 967 ,  per Sedley LJ, approved by the House of Lords in Campbell -v- MGN Ltd  2 AC 457  per Lord Nicholls;  per Lord Hope; - per Baroness Hale and in In re S (A Child)  per Lord Steyn. The authorities identify the correct test whenever Article 10 and Article 8 interests conflict as that in In re S (A Child)  and the test to be applied at the interim stage as that provided by s.12 Human Rights Act 1998.
 Although it is asserted that the claimant will suffer financial damage by reason of the effect on its commercial reputation, it is difficult to see how this case differs, save perhaps in matters of degree, from the ordinary case where a regulator responsible for regulating a particular area of activity publishes an adverse report in respect of the person or body who is subject to regulation. If the person who is the subject of an adverse adjudication contends that the adjudication is unlawful then it can say so. It can say that it does not accept the adjudication and proposes to appeal, either by way of internal review or appeal process, by way of statutory appeal or by judicial review, whichever is appropriate in the circumstances of the particular case. The mere fact that the person criticised is challenging the lawfulness of the decision cannot possibly be a proper ground for preventing a public body from doing its public duty and publishing an adjudication that it has made.
 There would, in my judgment, have to be the most compelling reasons to prohibit a public body which has embarked on a quasi judicial task of that kind from publishing its decision. For example, there might be circumstances where there was persuasive evidence that the public body had engaged in vendetta against the person the subject of the adjudication, and the adjudication was prompted by a deliberate desire to inflict damage on the reputation of the person criticised. In my judgment, there would have to be extreme circumstances of that kind before the court would be prepared to intervene and grant injunctive relief. There are no such exceptional circumstances here. The challenge to the lawfulness of the decision is on conventional judicial review grounds. It is said there was a failure to take account of relevant considerations, that inadequate reasons were given, that the procedure adopted was unfair, and that the nature of the advertisement was misunderstood.
i) my findings as to the criticisms made against the Taveta Personnel and the defamatory meaning that the Particulars are capable of bearing; and
ii) the FRC's disavowal of any intention to criticise or make findings against Taveta Personnel (see [75(v)] above),
the FRC might be concerned that reliance on a defence of qualified privilege as an answer to a claim for defamation risks being met by a contention that the publication was malicious (in the legal sense of that word). That would not be on the grounds of any improper motive on the part of the FRC but on the footing that, if the publication is held to bear the meaning I have found the words are capable of bearing, the FRC could not believe that that was true. I say no more about that. It is for the FRC to consider whether it would be lawful to publish the Sanction Documents in unamended form following this judgment.