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Talkin’ bout a revolution

By Steven | April 16, 2010

Check out this fascinating panel discussion about super injunctions and the laws of libel and privacy, hosted by the Frontline Club, involving successful defamation defendant Simon Singh, Carter-Ruck’s Nigel Tait, the Guardian’s investigations editor David Leigh, and media lawyer David Hooper. The debate comes amid British government proposals for libel reform (not enacted in time for the election, but taken up by all three of the main parties in their manifestos); the Court of Appeal’s decision in the Singh case; allegations that the courts are granting hundreds of super-injunctions a year; the recent appointment of a committee to tackle them; and much hand-wringing about legal costs and libel tourism. Is it time for a revolution in defamation law?

There was a surprising amount of consensus. Costs are too high (though not damages). The Press Complaints Commission is doing a lousy job (David Leigh called it a “fraud”). A statutory tribunal with power to deal with at least some less serious defamations, perhaps such as those emanating from blogs, would be a sensible development. There was some support for restricting the ability of corporations to sue – such as requiring them to prove financial loss (which is the current position in NZ; in Australia large corporations can’t sue at all).

They noted that statistics aren’t kept about super-injunctions (but should be). Could the panelists guess how many there were? Nigel Tait said his firm had obtained about 12 in the past 18 months. Schillings may have got a few more. He doubted there’d be many others. Hugh Tomlinson QC from the audience said he thought there were probably fewer than 20 in existence. (Justice Eady has recently said he can’t recall granting any at all. I wonder who’s awarding them?)

Nigel Tait threw some light on the sort of cases where they were sought. Computers are hacked by journalists or stalkers for personal or financial information, for example. He said one celebrity client’s doctor sold the results of his cancer tests to a newspaper before telling him. The superinjunction was to prevent the guessing game that would inevitably commence following the headline “Injunction restrains publication of [named celebrity’s] medical records”. (Fair enough, too, though does it justify the super-injunction? What if the injunction permitted reporting of the fact of the gag, but not that it concerned medical records? Perhaps I’m underestimating the voraciousness of the public’s appetite for knowledge of any information they’re denied.)

David Hooper criticised Tait and Carter-Ruck for being “over-muscular” in the Trafigura case. He thought there was a good case of breach of confidence, but they blew it and ended up looking terrible. Tait, with some justification, blamed the papers, noting that the Guardian had never reported that it initially consented to the super-injunction.

Tait also poured cold water on the idea of reversing the burden of proof for Truth defences, which currently rests on defendants). It would simply make plaintiffs spend up large proving their cases, costs that would inevitably be sheeted home to defendants when the plaintiffs won (or, of course, settled…). Besides, he said, he’s never seen a case decided on burden of proof (ie where the difference between winning and losing rested on whether a particular fact could be proved to a 51% likelihood). Interesting.

I was particularly interested in another factoid from Hugh Tomlinson. How many cases of libel tourism – ie one foreigner suing another in London to take advantage of the plaintiff-friendly British laws – do you suppose there were in the UK last year? Libel capital of the world and all that? The answer: none at all. How many libel lawsuits in the UK each year all up – the European average being about 700? Answer: 250. But Simon Singh treated this as a trump for his argument: libel is too costly in the UK for many to sue. This strikes me as sitting ill with his concern that speech is being chilled all over the place, and that conditional fee agreements and after-the-event insurance mean that plaintiffs can sue too readily. Surely he’d be better off suggesting that there’s likely to be a large number of defendants cowed into settling by the threat of CFA-funded litigation, so the threats never ripen into lawsuits. I don’t imagine there are stats on that either.

CFA fees were discussed at length.  Tait explained that costs have gone up because libel procedures – the pre-trial protocol, witness briefs – are themselves expensive; there is now a range of new defences such as qualified privilege that must be tackled; and yes, the win fee and the insurance bill multiplied final costs significantly. The uplift is justified because the law firm is carrying the costs and the risk, he argued. Everyone was duly appalled at the 100% uplift, though Tait explained that the success fee was only 100% if the case went to trial, when both parties could be assumed to believe that they had at least a 50% chance of winning. When there’s early settlement – most cases – it’s 25%. Singh and Leigh rather skewered him by noting that Carter-Ruck is still free to reject cases where the risk is bad and isn’t carrying much risk when it picks likely winners, especially when it knows defendants are risk-averse and likely to settle if the claim has a reasonable prospect of succeeding.

Still, no-one had an answer to Tait’s other point: firms won’t take cases on contingency if the uplift is only 10%, and the unwealthy defamed will have no remedy. Tomlinson suggested that the 10% figure nominated by the government was founded on … no evidence at all. He guessed 40% would probably be about right.

I’d be interested if any kiwi readers know of any conditional fee agreements with success fee components in defamation cases in NZ. I am occasionally willing to take a case on contingency, but so far have only done so where the case seems a slam dunk, and have only taken my usual fee when the case succeeds. I’m not sure how our courts would react to a costs application where a successful party tried to claim a success fee on top of scale or whatever other costs are merited. I rather suspect they wouldn’t be sympathetic. That would also make them rather difficult to negotiate, and there are no requirements here – as there are in the UK – that the other side be notified of any contingency arrangement. I’m also not aware of anyone offering after-the-event insurance to hedge against the possibility of loss here.

Topics: Defamation, Injunctions, Privacy tort | 40 Comments »

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