Defamation Bill

Lord Sentamu Excerpts

Tuesday 5th February 2013 Lords Chamber

[Lord Phillips of Sudbury]

At Second Reading, I devoted most of what I said to the issue of access to justice. I take my hat off to the noble Lord, Lord Puttnam, and his supporters, as well as the noble Baronesses, Lady O’Neill of Bengarve and Lady Hollins, for concentrating on the huge lacuna in this Bill and in the law of defamation generally. Let no one be under any misapprehension as to how unjust our law of defamation is. I speak as one solicitor—long in the tooth, it must be said—who has dealt over the years with defamation, from time to time. It is a scandal how much it is a plaything of the rich, completely beyond access by people of even ordinary means. So I am wholly emotionally in favour of what is intended by this set of amendments and the schedules.

I have listened to the noble Lord, Lord Lester, who never speaks with less than authority. At first hearing, I am not sure how all the points that he made would impact, but I accept at large what he has said. One has to hope that my noble friend Lord Fowler is correct, and that if we pass this set of amendments today the defects in them can be rectified either at Third Reading in this place or in the House of Commons or when it comes back to us. I am convinced that to leave this for another day would not be responsible of us—as the last speaker said. We must take the chance that we now have, defective though the amendment may be.

I add only one detailed point. My noble friend Lord Lester said that he was wholly opposed to the notion of exemplary damages pretty well willy-nilly. At least subsection (8) of Amendment 1 talks about exemplary damages for,

“a flagrant breach of … rights”,

of the claimant. Given the sensitivity of the relationship between the press and the citizenry, it might be an acceptable use of what is generally not desirable—exemplary damages, or the concept of it—in respect of a “flagrant breach”. Incidentally, subsection (8) of the amendment has in it a serious misprint. It talks about breach of a defendant’s rights when it should refer to a claimant’s right. That is but one of several matters that could and, I hope, will be improved in the course of this Bill through the two Houses. On that basis, I am in favour of the amendments going through.

[The Archbishop of York]

My Lords, first, I apologise that I was not in Grand Committee when the Bill was going through. The noble Lord, Lord Lester of Herne Hill, always speaks with great authority on human rights and the conventions, but I would have thought that this was not the Third Reading of the Bill. If it were, we would be coming to the end of the game. This is Report, so the noble Lord, Lord Lester, might put right the defects in the amendments so that when the Bill comes back at Third Reading it will be amended. So that argument does not hold water.

In the end, it is to do with trust. If trust is absent, what do you do? We all want to trust our newspapers, but what happens when there is no trust? The amendment proposes an:

“Arbitration Service for defamation and related civil claims against members of Independent Regulatory Board”.

Because it is to do, first of all, with a question of arbitration, I am attracted to it. I am attracted to it because the preacher from Galilee said that, if you have a dispute with your neighbour, it is better to try to settle it before you go to court, because when you go to court you may find yourself being given such a stiff sentence that you end up losing doubly. Therefore, I am attracted by the whole question of arbitration. The courts, of course, can look at whether the parties were willing or unwilling to engage in arbitration. If a person has been wronged and another person does not think that is the case, arbitration obliges them to have a conversation. It seems to me that we should accept Amendment 1 at this stage. Then the Government can perhaps suggest alterations to it. Certainly, the noble Lord, Lord Lester, is always very assiduous in correcting things that are not well put. Perhaps he can suggest alterations to the amendment.

I am not persuaded by the part of the amendment in the names of the noble Baronesses, Lady O’Neill and Lady Hollins, which seeks to delete subsections (5) to (7) of the proposed new clause in Amendment 1, although I may be persuaded by other parts of their amendment. Those subsections are very important. They set out what needs to happen. Therefore, I urge your Lordships’ House to pause and consider whether we really think that only the rich ought to have recourse to a remedy in defamation cases. The ordinary citizen could find redress very easily and quickly through arbitration. The press ought to welcome arbitration because it would cost far less than an elaborate court case, which may collapse in the end after a lot of costs have been incurred. When there is no trust, what do you do? You want to be in a position to rectify your situation. For those reasons, I support Amendment 1 and resist deleting proposed new subsections (5) to (7) from it.

[Baroness Kennedy of The Shaws]

My Lords, I, too, support these amendments. I always listen with care when I hear the noble Lord, Lord Lester, speaking about human rights because of his great experience and his important role in our nation in arguing for human rights. However, I take issue with his interpretation of Article 6 and the statement that any kind of arbitration in this field would in some way contravene that article. The whole purpose of human rights is to empower the weak and to recognise the ways in which due process can often disadvantage those who have no money. The purpose of arbitration in this context is not simply to speed things up or to move things along. Much of our arbitration concerns two parties coming together to try to find a smoother way to deal with something, but in this context the purpose of arbitration is to redress the fact that our current system disadvantages whole tracts of people who cannot afford to go to litigation at all. I think you would find that the courts would not accept the literal interpretation of this concept on the part of some of our colleagues. The noble Lord, Lord Faulks, also said that this provision would be a contravention of human rights. I think you would find that the courts would take a very different view.

--- Later in debate ---

[Lord Marks of Henley-on-Thames]

My Lords, I, too, support the amendment, but I do so on the basis that the general restriction on companies suing for defamation is limited to the requirement in subsection (3) of the proposed new clause that trading entities should have to show actual or likely financial loss before being entitled to sue for defamation. As drafted, proposed new subsection (2) would introduce a restriction on companies that is not so limited and is entirely undefined.

However, the restriction in proposed new subsection (3) is in line with the recommendation of the Joint Committee on the draft Bill, on which I served, and, as the noble Baroness, Lady Hayter, has pointed out, the recommendation of the Joint Committee on Human Rights as well. Whether companies should be able to sue for defamation was one of the issues that the Joint Committee was specifically asked to consider outside the ambit of the draft Bill, and we took a great deal of time and heard a great deal of evidence on this issue. The amendment accords with the sense of many who believe that corporate bodies trading for profit should not be in precisely the same position as natural persons in defamation law.

As in so much of the law in this area, the task is to strike the right balance between the right to free speech and the right to protect reputation. But it is a fact that companies cannot suffer hurt in their feelings and personal reputations in the same way as individuals can. Therefore, many have called for companies to be denied the right to sue for defamation. It is argued that companies have other ways to protect their reputations. It is argued that individual directors can sue, but to bring a suit for defamation is a serious undertaking and would expose those individual directors to substantial personal risk in costs when the real claimant should be the company. It is argued that large companies may have other steps they can take to protect their reputations by advertising or seeking publicity for their position, but that depends on their financial strength. A right to sue for malicious falsehood is often mentioned, but that is dependent on an ability to prove malice, which is notoriously difficult to do.

I take a different view. While companies do not have feelings that can be hurt, they can suffer financially, as my noble friend Lord Lester has pointed out. Defamatory statements about companies can have very serious consequences for their businesses, affecting the jobs of their staff and the prosperity of all concerned in them—whether or not untrue and defamatory statements are made with a view to profit by competitors or innocently by journalists. Therefore, it does not seem to strike the right balance to deprive companies of the right to sue for defamation altogether, quite apart from the fact that it would probably be contrary to the HRA to do so.

However, it seems proportionate and balanced to insist that companies and other non-natural persons trading for profit show that they have suffered or are likely to suffer substantial financial loss as a result of the defamation in respect of which they wish to sue. Imposing that condition recognises the difference in kind between individuals and non-natural persons trading for profit. It would not restrict the right of charities and other not-for-profit organisations to sue, and it is right that it should not do so; for example, charities can suffer from defamation in their future ability to raise funds, but it may be very difficult for them to demonstrate that. Proposed new subsection (3) of this amendment applies only to import a modest and proportionate restriction on the right of trading entities to sue and would introduce a valuable extra reform to this Bill.

Finally, I support the reform suggested by proposed new subsection (4) relating to bodies performing public functions, for the reasons that the noble Baroness, Lady Hayter, and my noble friend Lord Lester have already given, but principally because bodies performing public functions should be open to public criticism, even if private, in just the same way that public authorities are.

[The Archbishop of York]

My Lords, I, too, want to add a sentence of support to what the noble Baroness, Lady Hayter, and the noble Lord, Lord Lester, said.

I am patron of many charities and it would not be right if we did not strike the right balance. If a charity felt it was defamed because it was a body corporate, the restriction that has been put in here requiring the permission of the court is necessary. We are living in a very litigious society so if you are going to go to court to sue anybody, the permission of the court should be shown.

In proposed new subsection (3) there is the question of finance and the possibility of striking out if you cannot actually show that you have suffered loss. Because of that balance—that common sense that the noble Lord, Lord Lester of Herne Hill, was talking about—I am very attracted to this, and I hope that the Government will accept both limbs of the amendment, because you really could not do one without the other. It strikes a balance. For such a very long time, individuals could sue but reputational damage, as well as financial loss, is often incurred by a number of charities and it would be good to be able to do the same thing in terms of bodies corporate.

[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.