Defamation Bill

Julian Huppert Excerpts

Tuesday 16th April 2013 Commons Chamber

[Mrs Grant]

I am very aware of time scales and if the hon. Gentleman could bear with me for 30 seconds longer, we might be able to move from this section to the next section.

Moreover, the amendments were tabled at a time when cross-party talks were well under way to identify an agreed response to Leveson’s recommendations, including careful efforts to develop a set of workable criteria for the self-regulatory body. The amendments before us pre-empted the outcome of those talks. As the House will be aware, on 18 March cross-party talks were resolved successfully and a draft royal charter was agreed as a vehicle by which the recognition body should be set up. Detailed criteria by which self-regulators would be assessed were also agreed, and provisions to enact Lord Justice Leveson’s recommendations on incentives in costs and exemplary damages have subsequently been included in the Crime and Courts Bill. Further, a “no change” clause has been included in the Enterprise and Regulatory Reform Bill as a safeguard against political intervention with the royal charter.

I note that my hon. Friend the hon. Member for Worthing West (Sir Peter Bottomley) has tabled a motion to agree with amendment 16, which introduces a requirement for an independent regulatory body to provide an arbitration service. I should like to reassure my hon. Friend and this House that the recognition criteria contained within the agreed draft royal charter include just that. To retain amendment 16 in the Bill, alongside the provisions within the royal charter, risks creating duplication and uncertainty around these requirements. The package of measures identified to enact Lord Justice Leveson’s recommendations have cross-party support. As Lord Puttnam, who tabled these amendments, said:

“Nothing in the world will delight me more than to see the Defamation Bill pass in its original form.”—[Official Report, House of Lords, 25 March 2013; Vol. 744, c. 880.]

On that basis, I hope that the House will agree to the removal of Lords amendments 1, 15 and 16.

I also ask the House to disagree with Lords amendment 2. A motion to that effect has been tabled by my hon. and learned Friend the Member for Harborough (Sir Edward Garnier). The amendment concerns two distinct but related issues, which have already featured extensively in debates in both Houses during the passage of the Bill.

[Dr Julian Huppert (Cambridge) (LD)]

I thank the Minister for giving way so early in her speech. She is presumably aware that the Joint Committee on the draft Defamation Bill, on which I served, said that it favoured the approach that limits libel claims to situations where the corporation can prove the likelihood of substantial financial loss. Does she understand the reasons behind that, and can she give us any reassurances on that?

[Mrs Grant]

I fully understand those reasons, and if the hon. Gentleman will bear with me and allow me to progress on to an explanation of those amendments, I hope that all will be revealed to him.

The separate but related issues are whether there should be any restrictions on the rights 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 altogether from bringing a claim in relation to a statement concerning that function. In relation to the first issue, the amendment would mean that in order to bring a claim, a non-natural person would first have to obtain permission of the court. The court would be required to strike out any such application, unless the claimant could show that the publication of the statement complained of had caused, or was likely to cause, substantial financial loss. We believe that a permission stage for this purpose would create unnecessary duplication and additional costs for both parties.

If the claimant was required to show substantial financial loss in order to satisfy the permission requirement, it would in effect mean that the claimant would satisfy the serious harm test introduced by clause 1. We have asked the civil procedure rules committee to consider rule changes to support a new early resolution procedure under which either party could apply at the outset of proceedings for the court to decide certain key issues, including whether the serious harm test is satisfied. The addition of a permission stage would therefore add little or nothing, because any case where the existence of serious harm was disputed could have that issue resolved at a very early stage in any event.

--- Later in debate ---

[Sadiq Khan]

I am terribly sorry, but the Minister did not say that. She alluded to the civil procedure rules and to the Civil Justice Council, but she did not say that she would go away and table an amendment in lieu of the previously amended clause 2. If she had agreed to table, next week, a new amendment containing subsections (1), (2), (3), but not (4)—for the reasons that she articulated—that would be an argument in the right hon. Gentleman’s favour.

This is the tactic. The right hon. Gentleman can vote with us. Members of his party, plus ours, defeat the Government, and we succeed in ensuring that the amended clause 2 is in the Bill.

[Dr Huppert]

Will the right hon. Gentleman give way?

[Sadiq Khan]

I will in a moment, but I want to make some progress first. We have only an hour in which to debate the amendments because of the way in which the Government programmed the debate.

Sadly, publishers are routinely threatened with libel proceedings by corporations who do not want negative coverage. The Lords amendment would make that more difficult.

--- Later in debate ---

[Sir Edward Garnier]

On 26 October, and I share a birthday with President Mitterrand and Hillary Clinton. Let us move on, however.

I have already declared my interest, so I hope I do not have to do so again. I want to say that this is not a question of being right or wrong. I am not saying that I am right, that my hon. Friend the Minister is right or that the right hon. Member for Tooting is wrong, but that this is a matter of judgment and opinion. We are perfectly entitled to have different views about how best to order the law on defamation.

It so happens that the right hon. Gentleman and I take a different view on Lords amendment 2 on non-natural persons. I happen to think that Lord Bingham was right in the Jameel case in 2007 to make it quite clear that he thought it was perfectly proper and right for corporations to be able to bring actions for libel without proof of special damage—without having to show money loss. I will not recite all that he said, as there is not enough time, but it is worth bearing it in mind when some of the more hyperbolic accusations are traded about companies that bring actions for libel to terrorise or use their financial muscle to inhibit the defence of those actions or to inhibit free speech.

[Dr Huppert]

Does the hon. and learned Gentleman accept that there is a fundamental difference between non-natural persons and natural persons in terms of aspects to do with feelings, for example? Corporations of any size cannot have feelings that can hurt by defamatory action; there is a fundamental difference that the law should reflect.

[Sir Edward Garnier]

That is not only fundamental; it is highly uncontroversial. Human beings can get damages for hurt to their feelings; companies cannot. One cannot libel a company by accusing it, for example, of adultery, whereas one can so libel an individual. There are plenty of obvious and not very surprising differences between the law relating to individuals and the law relating to companies, but there are examples of things which affect companies’ trading reputations, which should be susceptible to protection.

We should also bear it in mind that there are different types of company. There are not-for-profit companies which are not in the business of making money and which, if they were libelled, would not lose money. It may well be said in response to me that the amendment deals with that. They would get permission from the court to bring that action, but that just creates another hurdle, as the Under-Secretary of State for Justice, my hon. Friend the Member for Maidstone and The Weald (Mrs Grant), made clear.

[Sir Edward Garnier]

I shall not unwind the case of Singh or the Wilmshurst case; they have been before the courts and have been dealt with. As it happens, the case of Simon Singh became controversial because it was an argument about whether the words complained of constituted allegations of fact or whether they were capable of constituting comment. That is the point on which it went to the Court of Appeal.

There was an action in South Africa brought by a tobacco company which sued and recovered damages on the allegation that its products promoted cancer. Things change. That is the advantage of having an organic system of law which enables the courts to deal with evidence and reach conclusions about whether a company or anyone else has been attacked inappropriately.

As I was saying to the hon. Member for Cambridge (Dr Huppert), it is not all that hard to think of statements which seriously injure the general commercial reputation of trading and charitable organisations. An arms company—

[Dr Huppert]

Will the hon. and learned Gentleman give way?

[Sir Edward Garnier]

If the hon. Gentleman will forgive me, this debate stops at 7.13 pm.

Arms companies can be accused of bribing foreign officials. Oil companies can be accused of damaging the environment. International humanitarian agencies can be accused of wrongfully succumbing to Government pressure. Retailers can be accused of exploiting child labour, and so on. As the right hon. Member for Tooting said, the directors or the leading members of those companies may also have a parallel course of action, but the company itself should not be shut out from pursuing a course of action if that is available to it.

The good name of a company, as that of an individual, is a thing of value. A damaging libel may lower its standing in the eyes of the public and even of its own staff and make people less ready to deal with it and less willing or less proud to work for it. If that were not so, corporations would not go to the lengths they do to protect and burnish their corporate images. There is nothing repugnant in the notion that this is a value which the law should protect, and it is not an adequate answer that the corporation can itself seek to answer the defamatory statement through press releases or public statements, as protestations of innocence by the impugned party necessarily carry less weight with the public than the prompt issue of proceedings which culminate in a favourable verdict by a judge or a jury.

Furthermore, why should one have to accept that a publication, if truly damaging to a corporation’s commercial reputation, will result in provable financial loss, since the more prompt and public a company’s issuing of proceedings, and the more diligent its pursuit of a claim, the less the chance that financial loss will actually accrue? It may be argued against me that all these matters will be dealt with in the permission hearing, but when is the permission hearing to take place? Will the corporation have to wait right until the end of the limitation period? Will it have to wait for weeks and weeks while the next set of accounts comes out, so that it can work out whether financial loss has occurred as a consequence of the libel? There might be any number of causes of a company suffering an economic downturn, particularly in a recession.

I return to the point I made about not-for-profit companies and charities.

[Dr Huppert]

Has the hon. and learned Gentleman seen that the amendment that I hope the Government will bring forward specifically refers to trading-for-profit organisations, as the Joint Committee recommended? It specifically excludes charities.

--- Later in debate ---

[Sir Peter Bottomley]

I want to make two points that were not those I intended to make originally. My third point is that I disagree with my hon. and learned Friend the Member for Harborough (Sir Edward Garnier) almost completely about this, so I will not put those arguments.

Tesco Lotus in Thailand sued a journalist for £1.9 million—perhaps it was dollars or something, but it was quite a lot—because it wanted an apology, and it eventually got an agreement to have a clarification of the words on an inside page. It later sued a former MP, a business journalist, in the same way.

Corporations such as Tesco, whether in joint venture overseas or in this country, should not be able to choose to sue an individual journalist; it simply should not happen. They have plenty of power, plenty of weight, plenty of thick skin and an umbrella, and they should not be able to do it.

I would have stopped corporations suing for libel at all.

I believe strongly that public functions should fall under the Derbyshire principle, irrespective of whether we want private businesses doing public jobs. Earlier I gave the example of a security guard at a pop festival. I regard security as a public function even if it is privately hired, and such people should not be able to sue for libel. The court should not issue the writ; it should not be allowed.

Let me make a point on behalf of Colin Channon, the editor of my local newspaper, the Worthing Herald, who says that were he to report that a group of unauthorised campers was in the constituency and he were then sued, he would have to pay £3,000 for initial advice before he got to a panel. We are in danger of our local newspapers being threatened.

As for people conspiring to say that the police would not confirm whether someone had been arrested, the idea that someone could sue for a libel that claimed they had been arrested but which had not been confirmed, even though true, makes the issue even worse. I am unhappy with most of this but I am particularly unhappy that the Government have not yet found a way of having new clause 2, in effect, there for all of us.

[Dr Huppert]

It is a pleasure to follow the hon. Member for Worthing West (Sir Peter Bottomley), with whom I have had many promising discussions on the issue. I am delighted that the Bill is back in the Commons. There was a period when, due to the actions of the Labour peer Lord Puttnam, there was a risk. I am glad that that risk did not eventualise and that it turned out not to be a problem.

This Bill will make a significant change to the costs of libel and to free speech and it will reduce libel tourism. I am particularly pleased about clause 6, which provides specific protection for peer-reviewed academic and scientific publications. That is something that I value greatly and I am delighted that we will be able to make those protections, because we have heard of too many cases of learned journals being silenced.

The issue remains, however, of corporations and non-natural persons. As I argued earlier, they are different. They do not have feelings. They are categorically separate and there should be different rules for what happens when they wish to bring libel actions. Significantly, we have heard that they can abuse power, as in the cases of Peter Wilmshurst and Simon Singh. I was going to talk more about them, but a number of speeches have covered them.

There is, largely, cross-party agreement, with the notable exception of the hon. and learned Member for Harborough (Sir Edward Garnier).

[Sir Edward Garnier]

Does the hon. Gentleman accept that “a body corporate” in subsection (1)(a) of the new clause proposed by Lords amendment 2 does not restrict it to money-making corporations?

[Dr Huppert]

The hon. and learned Gentleman is correct. I understand that that is the intention and that is what was recommended. I eagerly anticipate a Government amendment and hope that it will address that issue. None of us wants to put constraints on charities. This relates to profitable or profit-making organisations, or at least those that are trying to make a profit.

I heard the Minister make a commitment to actively consider such amendments. My understanding is—I am still new to parliamentary procedure—that that is as far as a Minister is able to go at this stage. I would be grateful if it was not her intention to set high expectations for such an amendment being tabled in the Lords. She is welcome to clarify the issue now; otherwise, I am very happy with what she said and look forward to the amendment.

We will get cross-party agreement on corporations having to prove that they have suffered serious financial harm. Simon Singh has correctly said that that would have saved him. Such a provision is still missing from the Bill, but I believe that the Government have now said that they will address it. I trust the Government on that and I look forward to the amendment and to the Bill finally changing.

As John Kampfner, the former chief executive of Index on Censorship, said:

“When we launched the Libel Reform Campaign in 2009, only the Liberal Democrats backed change. Now the cause has cross party support.”

I look forward to seeing this Bill become an Act.