Defamation Bill

Debate between Lord Ahmad of Wimbledon and Lord Faulks

Tuesday 5th February 2013 Lords Chamber

[Lord Faulks]

My Lords, of course, there is in the Bill a significant hurdle for any claimant, whether a non-natural person or a natural person: they have to show serious harm, so that is a hurdle of itself.

I supported the general tenor of this amendment in Committee but expressed a reservation at that time. Indeed, the Joint Committee on Human Rights expressed a similar reservation, which is: what about the small companies? Of course, I accept that the individual can sue if he or she is sufficiently identified, but if it is a small business—say, the local ice cream vendor; maybe nobody knows them by name but they have a valuable local business reputation—it will have to overcome considerable hurdles before suing. It will have to show substantial financial loss; it may not be very substantial objectively but it may be very substantial to that business. The hurdle of serious harm added to this procedure seems to prevent it recovering in circumstances where it should be able to recover.

Malicious falsehood may be difficult to prove, in the sense that malice is always difficult to establish. None the less, if I say that Hayter & Co. is going out of business, when it plainly is not, it is not difficult to infer malice from that pronouncement. It would be unfortunate if companies had to resort to the alternative tort in circumstances where they should, in my view, be able to rely on ordinary defamation.

My final observation relates to proposed new subsection (4). I accept what my noble friend Lord Lester said about the public function. Deciding whether somebody performs a public function is not necessarily very easy, just as deciding whether something is a public authority for the purposes of the Human Rights Act has caused the courts considerable distress.

I have sympathy with the general tenor of this amendment but I cannot go all the way with it.

[Lord Ahmad of Wimbledon]

My Lords, I thank all noble Lords who have taken part in this short debate. As has been pointed out, Amendment 2 concerns two distinct but related issues. Indeed, my noble friend Lord Lester, who I greatly respect with regard to this Bill in particular, described it as two limbs. That is a nice way of reflecting on the current Government, in having two arms to the same body, and we are seeking to move forward on these matters.

The issues that have been raised again this afternoon were extensively debated during the previous stages of this Bill. These are whether there should be restrictions on the right of bodies corporate and other non-natural persons to bring an action in defamation, and whether any non-natural person which is performing a public function should be prevented from bringing a claim in relation to a statement concerning that function.

In relation to the first issue, the Government have made it clear in previous debates that there is a difficult balance to be struck, as the most reverend Primate articulated. Considerable damage can be done to the reputation of a business by unjustified and defamatory allegations, and this has an impact on all those involved with the business, including its shareholders and employees. On the other hand, we fully recognise the need to ensure that powerful businesses are not able to—for want of a better term—bully individuals or organisations with limited means into remaining silent on issues of public importance by the threat of libel proceedings.

However, if that is the problem we are trying to solve, imposing specific restrictions on the ability of businesses to sue does not seem justified. Wealthy individuals can equally send threatening letters to those with limited means. This is why we think the twin-track approach we are proposing is preferable. It embraces both elements within the Bill and procedural changes alongside it.

First, all claimants—corporate or otherwise—will have to satisfy the new test of serious harm, as my noble friend just mentioned. As we have made clear, it is our intention that the serious harm test will raise the hurdle for bringing a claim and will ensure that trivial claims do not proceed. In order to satisfy the serious harm test, businesses are likely in practice to have to show some form of actual or likely financial loss. The courts have talked in terms of,

“a tendency to directly affect its credit or property or cause it pecuniary damage”.

Quite what that will require will depend on the type of business concerned and the facts of the particular case, and we do not think that it is helpful to attempt to define explicit restrictions in the Bill.

Defamation Bill

Debate between Lord Ahmad of Wimbledon and Lord Faulks

Tuesday 15th January 2013 Grand Committee

[Lord Ahmad of Wimbledon]

Theology is always one to park, but, as a man of faith—and as a fellow man of faith—I take my noble friend’s guidance on that. The point I am making is about stakeholders—those people who are looking at this issue. Yes, it involves website operators, but the point of this clause is that it is not the website operators doing the defaming, it is the person who has written the statement. That is the person who should be held accountable and responsible. Where the website operators’ obligations come in is whether they have followed the process as detailed in Clause 5.

Coming back to the point about balance that my noble friend made, this is not just about talking to website operators but about talking as well to people who represent claimants, to ensure that those people who represent the body that feels it may be subject to such actions are also heard and that their case is also made. However, I am sure that my noble friend would agree with me that, if we started consulting every single individual who may or may not be concerned on an individual basis with this, our Committee would continue for a very long time. Nevertheless, as I have alluded to several times—and I repeat the point again—in speaking to all these amendments it is important for me to place on record that the Government are aware of the pace of change in internet and electronic communications. Even as perhaps one of the younger Members of your Lordships’ House, I remember in my professional life when the internet first came alive. Things are changing by the minute, and the pace of change is somewhat beyond even my comprehension. There are innovations in electronic communications and, as I have indicated in all my responses, in particular in response to Amendment 23A, we have an open mind in respect of terminology. In addition, we believe that putting the details of the Clause 5 process in the regulations provides greater flexibility to adjust aspects of the new procedure should that prove necessary as technology develops.

[Lord Faulks]

I am grateful to the Minister for giving way; he has been patient and has had to deal with a lot of amendments. He was dealing a little while ago with Amendment 29 in the name of my noble friend Lord Phillips of Sudbury. I understood his answer to be that he could not conceive of circumstances in which an operator of a website could be malicious, and this amendment was therefore not necessary. However, operators of a website are given an admittedly qualified privilege by Clause 5 which puts them in exactly the same position as those in other fields of the law who have a qualified privilege, the defence of which is defeated by malice. Is it not therefore inconsistent that such a remedy should not be available in the terms of this amendment? It may not happen very often, but that is no reason for it not existing at all.

[Lord Ahmad of Wimbledon]

I hear what my noble friend says. Perhaps we can refer to this matter; he makes a valid point. As he rightly acknowledges, we would not see this issue occurring on a regular basis, but I will certainly reflect on his comments on this.

A variety of amendments has been tabled. On “balance”, I suppose it depends how you define the word. However, in seeking to bring the Bill forward, and particularly with this clause, the Government are seeking to strike the right balance. We continue to listen, hear and consult with all parties on both sides of the coin. We are working to ensure that something practical and workable, which protects those who are subject to such actions, comes out of this process.

Transforming Rehabilitation

Debate between Lord Ahmad of Wimbledon and Lord Faulks

Wednesday 9th January 2013 Lords Chamber

[Lord Ahmad of Wimbledon]

My Lords, we have yet to hear from the Conservative Benches.

[Lord Faulks]

I welcome this Statement, particularly its focus on those with sentences of less than 12 months and its identification of that period of vulnerability as young offenders leave prison. One of the particular areas of vulnerability is those offenders who have a previous history of drug addiction who are then prone to taking large doses of drugs which can result in death. I therefore welcome the role of a mentor, although I recognise what the noble Lord, Lord Ramsbotham, has said about the perception of custody plus because I was sitting as a recorder at the time. However, the role of a mentor seems to me to be potentially very important. Can the Minister help the House by identifying who exactly is going to perform this mentoring role and what its scope might be so as to assist in avoiding those traps that I have attempted to identify?

Legal Profession: Regulation

Debate between Lord Ahmad of Wimbledon and Lord Faulks

Monday 3rd December 2012 Lords Chamber

[Lord Ahmad of Wimbledon]

I thank the noble Baroness for her question and I agree with her. It is important that those in the profession contribute to the effectiveness of how these rule changes are implemented. I take on board what she says and I hope that some of the proposals we are putting forward will address the issues. I note the concerns expressed by my noble friend Lord Faulks and the noble Lord, Lord Hunt, about mission creep on the part of the Legal Services Board. As I said at the outset, the important issue is about the terms of reference: what was the Legal Services Board set up to do? Earlier this year, the Ministry of Justice conducted a triennial review of the Legal Services Board and the Office for Legal Complaints. Based on this, let me assure your Lordships that, on the responses received—including those from the approved regulators—the review concluded that, while it is still relatively early to assess the full impact of the Legal Services Board, its functions are still needed and should continue to be delivered in their current form.

This was a view supported by the Bar Standards Board and the Bar Council. We must remember that the Legal Services Board is independent of government and it is not for us to dictate how it operates. Its functions are clearly set out in the 2007 Act. However, it is clear that there has been a real need for an oversight regulator to drive the reforms set out in the Act. In doing so, it has fulfilled the important role that only an oversight regulator could have. Those who responded to the triennial review recognised the value it has brought. Following the feedback we have received, the chairman of the Legal Services Board wrote to the Ministry of Justice confirming that his board is also considering the responses made so far.

I am conscious of time, but turning to specific questions, my noble friend Lord Gold raised the issue of micromanagement and corporate governance. The Legal Services Board recognises that important challenges are emerging from the triennial review and accepts that there are things it needs to address. These will include more detail on its draft business plan for 2013-14, and proposals will include reviewing the approach to requests for changes to regulatory arrangements and designation processing, and refining the approach to research funding. Priorities will be included in the draft business plan. Increased understanding of the cost of regulation, not just the cost of the LSB but the full cost of practitioners, will also be looked at. A further issue was raised regarding the value for money of the Legal Services Board. Since the board became operational, it has recognised the need to keep its costs proportionate, and we have seen its running costs reduced year on year, from just over £5 million in 2009-10 to £4.5 million in 2011-12. The combined running costs of the Legal Services Board and the Office for Legal Complaints were approximately £22 million, somewhat less than the cost of the complaint handling regime that was previously in place.

Various issues and questions have been raised in terms of accountability and the post-legislative review. We are confident that for the here and now, the regulation of legal services is appropriate, but that does not mean it will remain so indefinitely. Given that the new regulatory framework was implemented only in 2010, we still believe that it is in its infancy. The next triennial review is due in 2015 and will provide another opportunity to assess how the regulatory framework is performing and whether the LSB’s functions are still needed in an evolved legal services market.

In conclusion, it is important to remember that the new regulatory regime and governance arrangements are still in their early stages, a point acknowledged by respondents to the triennial review. I assure the noble Baroness, Lady Deech, my noble friend Lord Faulks and other noble Lords that the Government are fully engaged with the legal profession and other interested parties in carrying out that triennial review. During that process, we not only conducted a call for evidence but held round-table events and one-to-one meetings. We will continue to engage openly with interested parties as part of that. I also assure noble Lords, including my noble and learned friend Lord Mackay, the noble and learned Lord, Lord Goldsmith, and my noble friend Lord Faulks, as well as the noble Baroness, that we will carry out post-legislative assessment of the Legal Services Act. That will look at the original aims of the reforms and how far we have come in implementing them, and we will be seeking further stakeholder views. Finally—

[Lord Faulks]

Before the noble Lord concludes his remarks, can he help the House by saying whether one possible outcome of the review will be that the Ministry recommends that the LSB does not have any further function at all?

[Lord Ahmad of Wimbledon]

I thank my noble friend for the question. That is a matter that will come up. As I have already alluded to, this organisation is in its infancy and came about only in 2010. It is right that we look at this again at the time of the review in 2015.

Finally, I also assure my noble and learned friend Lord Mackay, who talked of his Green Papers—and being green in your Lordships’ House, he was my very own personal parliamentary Companion—that I heard what he said about the importance of education and his particular question about universities and the College of Law. I shall certainly refer that to my right honourable friend the Universities Minister.

The reforms enabled by the Legal Services Act have provided a proportionate and effective regulatory regime that remains, currently, fit for purpose. All those with an interest in the legal services market have an interest in ensuring that this continues. I thank the noble Baroness—and indeed all noble Lords—for their contributions this evening, with the assurance that we will continue to look at this particular function and its effective regulation, with all interested parties contributing to future reviews.